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EXHIBIT D
FORM OF
PLEDGE AND SECURITY AGREEMENT
This PLEDGE AND SECURITY AGREEMENT (this "Agreement"), dated October
12, 1999, is made by and between Xxxxxx X. Xxxx and Xxxx X. Xxxxxx, Xx. as
trustees of the Xxxxxx Xxxxxxxx GST Trust [number of Trust] (the "Debtor"), in
favor of C. Xxxxxx Xxxxxxxx (the "Secured Party").
RECITALS
A. The Secured Party is the legal owner and holder of that
certain Demand Note dated May 25, 1999, executed by the Debtor in favor of the
Holder in the original principal sum of $4,500,000 (the "Note").
B. The Note is secured by a Pledge and Security Agreement (the
"Security Agreement") dated May 25, 1999 by and among the Secured Party and the
Debtor pursuant to which the Debtor pledged its interest in 17,000 shares of
the common stock of Hollywood Marine, Inc. (the "Shares") to the Secured Party.
C. The Note is also secured by a Financing Statement (the
"Financing Statement") dated May 25, 1999, executed by the Secured Party and
the Debtor and covering the Debtor's interest in the Shares.
D. Hollywood Marine, Inc. ("HMI") has agreed to merge with Xxxxx
Inland Marine, Inc. ("XXX") pursuant to the certain Agreement and Plan of
Merger (the "Merger Agreement") dated July 28, 1999, by and among HMI, XXX,
Xxxxx Corporation ("Xxxxx"), and each of the shareholders of HMI.
E. It is a condition of the Merger Agreement that the liens on
the Shares created by the Security Agreement and the Financing Statement be
released.
F. The Debtor, as a shareholder of HMI, desires that the
transactions contemplated by the Merger Agreement be consummated.
G. The Secured Party has agreed to execute that certain Full
Release of Lien of even date herewith (the "Release") releasing the Shares and
the liens thereon created by the Security Agreement and the Financing Statement
and the Shares on the condition that the Debtor execute an alternate security
agreement and financing statement continuing the Secured Party's original
security interest and covering the consideration received by the Debtor under
the Merger Agreement for the Debtor's interest in the Shares, which
consideration constitutes proceeds of the Shares.
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AGREEMENT
In consideration of the promises herein contained, and in order to
induce the Secured Party to execute the Release, the parties agree as follows:
SECTION 1. Grant of Security Interest in Investment Account. As
collateral security for all of the Obligations (as defined in Section 2
hereof), the Debtor hereby pledges and assigns to the Secured Party, and grants
to the Secured Party a continuing security interest in, the following
(collectively, the "Collateral"):
(a) all of the Debtor's right, title and interest in and to that
certain investment account at Chase Bank of Texas, N.A. in Houston, Texas in
the name of the Debtor and bearing the account number 55010012082205 (the
"Investment Account") and all money, whether in currency of the United States
or any foreign country, on deposit therein, and all investments of whatever
kind and nature arising therefrom or held therein;
(b) all of the shares of Xxxxx common stock received by the
Debtor under the Merger Agreement as consideration for the Shares (the "Pledged
Shares"), the certificates representing the Pledged Shares, all options and
other rights, contractual or otherwise, in respect thereof and all dividends,
cash, instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the
Pledged Shares;
(c) all additional shares of stock, from time to time acquired by
the Debtor, of Xxxxx, the certificates representing such additional shares, all
options and other rights, contractual or otherwise, in respect thereof and all
dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such additional shares; and
(d) all proceeds and products of any and all of the foregoing;
in each case, however the Debtor's interest therein may arise or appear
(whether by ownership, security interest, claim or otherwise) (all such
Collateral described in the foregoing clauses (b) and (c) and any proceeds
therefrom being hereinafter collectively referred to as the "Pledged
Collateral").
SECTION 2. Security for Obligations. This Agreement and the lien and
security interest created hereby in the Collateral secure the prompt and
complete:
(a) payment of all obligations of the Debtor to the Secured Party
now or hereafter existing under the Note and any other document related thereto
or executed in connection therewith to which the Debtor is a party, as each may
be modified, amended, extended or renewed from time to time; and
(b) performance and observance by the Debtor of all covenants,
conditions and agreements contained in the Note and any other documents related
thereto or executed in
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connection therewith to which the Debtor is a party, as each may be modified,
amended, extended or renewed from time to time (including, without limitation,
the covenants, conditions and agreements contained herein), whether for
principal, interest, fees, expenses or otherwise;
all such obligations, covenants, conditions and agreements described in the
foregoing clauses (a) and (b) being hereinafter collectively referred to as the
"Obligations".
SECTION 3. Delivery of the Pledged Shares; Filing of Financing
Statements.
(a) All certificates representing the Pledged Shares shall be
delivered to or at the direction of the Secured Party upon the execution and
delivery of this Agreement. All other certificates and instruments constituting
Pledged Collateral from time to time shall be delivered to the Secured Party
promptly upon the receipt thereof by or on behalf of the Debtor. All such
certificates and instruments shall be held by or on behalf of the Secured Party
pursuant hereto and shall be delivered in suitable form for transfer by
delivery or shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to the Secured
Party.
(b) If the Debtor shall receive, by virtue of the Debtor's being
or having been an owner of any Pledged Collateral, any (i) stock certificate
(including, without limitation, any certificate presenting a stock dividend or
distribution in connection with any increase or reduction of capital,
reclassification, merger, consolidation, sale of assets, combination of shares,
stock split, spinoff or split-off), promissory note or other instrument, (ii)
option or right, whether as an addition to, substitution for, or in exchange
for, any Pledged Collateral, or otherwise, (iii) payment of dividends or other
distribution payable in cash (except such dividends permitted to be retained by
the Debtor pursuant to Section 6 hereof) or in securities or other property or
(iv) payment of dividends or other distribution in connection with a partial or
total liquidation or dissolution or in connection with a reduction of capital,
capital surplus or paid-in surplus, the Debtor shall receive such stock
certificate, promissory note, instrument, option, right, payment or
distribution in trust for the benefit of the Secured Party, shall segregate it
from the Debtor's other property and shall deliver it forthwith to or at the
direction of the Secured Party in the exact form received, with any necessary
indorsement and/or appropriate stock powers duly executed in blank, to be held
by or on behalf of the Secured Party as Pledged Collateral and as further
collateral security for the Obligations.
(c) In addition to delivering the Pledged Collateral as provided
in the foregoing clauses (a) and (b), the parties shall additionally file
Financing Statements with the State of Texas covering all of the Collateral
thereby perfecting the lien and security interest in the Collateral created by
this Agreement.
SECTION 4. Representations, Warranties, Covenants and Agreements. The
Debtor represents and warrants to and covenants and agrees with the Secured
Party as follows:
(a) The Debtor is and will be at all times the legal and
beneficial owner of the Collateral free and clear of any lien, security
interest, or other charge or encumbrance, including, without limitation, any
option, except for the security interest created by this Agreement.
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(b) The exercise by the Secured Party of any of Secured Party'
rights and remedies hereunder will not contravene law or any contractual
restriction binding on or affecting the Debtor or any of the Debtor's
properties and will not result in or require the creation of any lien, security
interest or other charge or encumbrance upon or with respect to any of the
Debtor's properties.
(c) No authorization or approval or other action by, and no
notice to or filing with, any person or entity, including, without limitation,
any governmental authority or other regulatory body, is required for (i) the
due execution, delivery and performance by the Debtor of this Agreement, (ii)
the grant by the Debtor, or the perfection, of the lien and security interest
purported to be created hereby in the Collateral or (iii) the exercise by the
Secured Party of any of Secured Party' rights and remedies hereunder, except as
may be required in connection with any sale of any Pledged Collateral by laws
affecting the offering and sale of securities generally.
(d) This Agreement creates a valid security interest in favor of
the Secured Party in the Collateral, as security for the Obligations. Upon
delivery of the certificates representing the Pledged Shares and all other
certificates, instruments and cash constituting Pledged Collateral from time to
time, endorsed in blank, to the Secured Party, and the filing of a financing
statement with the Secretary of State of the State of Texas in favor of the
Secured Party, naming the Debtor as "Debtor" and describing the Collateral, the
lien and security interest created herein will be a fully perfected, first
priority security interest in the Collateral. All action necessary or desirable
to perfect and protect such security interest has been duly taken, except for
the Secured Party' having possession of certificates, instruments and cash
constituting Pledged Collateral and the filing of a financing statement with
the Secretary of State of the State of Texas covering all of the Collateral
after the date hereof.
SECTION 5. Covenants as to the Collateral. So long as any of the
Obligations shall remain outstanding, the Debtor will, unless the Secured Party
shall otherwise consent in writing:
(a) keep adequate records concerning the Collateral and permit
the Secured Party or any of Secured Party' agents or representatives at any
reasonable time and from time to time to examine and make copies of and
abstracts from such records;
(b) at the Debtor's expense, promptly deliver to the Secured
Party a copy of each notice or other communication received by it in respect of
the Collateral;
(c) at the Debtor's expense, defend the Secured Party' right,
title and security interest in and to the Collateral against the claims of any
person or entity;
(d) at Debtor's expense, at any time and from time to time,
promptly execute and deliver all further instruments and documents and take all
further action that may be necessary or desirable or that the Secured Party may
request in order to (i) perfect and protect the security interest purported to
be created hereby, (ii) enable the Secured Party to exercise and enforce
Secured Party' rights and remedies hereunder in respect of the Collateral, or
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(iii) otherwise effect the purposes of this Agreement, including, without
limitation, delivering to or at the direction of the Secured Party, after
default, irrevocable proxies in respect of the Pledged Collateral;
(e) not sell, assign (by operation of law or otherwise), exchange
or otherwise dispose of any Collateral or any interest therein except as
permitted by Section 6(a)(i) hereof;
(f) not create or suffer to exist any lien, security interest or
other charge or encumbrance upon or with respect to any Collateral except for
the security interest created hereby;
(g) not make or consent to any amendment or other modification or
waiver with respect to any Collateral or enter into any agreement or permit to
exist any restriction with respect to any Collateral other than pursuant
hereto;
(h) not take or fail to take any action which would in any manner
impair the value or enforceability of the Secured Party' security interest in
any Collateral.
SECTION 6. Voting Rights, Dividends, Etc. Regarding the Pledged
Collateral; Management of the Investment Account.
(a) So long as no demand has been made on the Note:
(i) the Debtor shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Pledged Collateral or any
part thereof for any purpose not inconsistent with the terms of this Agreement
or the Note; provided, however, that (A) the Debtor shall give the Secured
Party at least five (5) days written notice of the manner in which it intends
to exercise, or the reasons for refraining from exercising, any voting or other
consensual rights pertaining to the Pledged Collateral or any part thereof,
which may have a material adverse effect on the value of the Pledged Collateral
or any part thereof;
(ii) the Debtor shall be entitled to receive and retain
any and all dividends or other distributions and interest paid in respect of
the Pledged Collateral; and
(iii) the Debtor shall be entitled to advise Chase Bank in
the management of the Investment Account.
(b) After demand has been made on the Note and so long as it has
not been rescinded:
(i) all rights of the Debtor to exercise the voting and
other consensual rights which the Debtor would otherwise be entitled to
exercise pursuant to paragraph (i) of subsection (a) of this Section 6, and to
receive the dividends and interest payments which the Debtor would otherwise be
authorized to receive and retain pursuant to paragraph (ii) of subsection (a)
of this Section 6, shall cease, and all such rights shall thereupon become
vested in the Secured Party which shall thereupon have the sole right to
exercise such voting and other
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consensual rights and to receive and hold as Pledged Collateral such dividends
and interest payments;
(ii) all dividends and interest payments and other
distributions which are received by the Debtor shall be received in trust for
the benefit of the Secured Party, shall be segregated from other funds of the
Debtor, and shall be forthwith paid over to the Secured Party as Pledged
Collateral in the same form as so received (with any necessary endorsement);
and
(iii) the Debtor shall execute and deliver (or cause to be
executed and delivered to the Secured Party) all such proxies and other
instruments as the Secured Party may reasonably request for the purpose of
enabling the Secured Party to exercise the voting and other rights which it is
entitled to exercise pursuant to clause (i) above and to receive the dividends
or interest payments which it is entitled to receive and retain pursuant to
clause (ii) above.
(iv) the Secured Party and not the Debtor shall have the
right to advise Chase Bank in the management of the Investment Account.
(c) So long as this Agreement and the lien and security interest
created hereby are in effect, the Debtor shall have no right to withdraw or
otherwise transfer any funds or investments out of the Investment Account
without the express written consent of the Secured Party.
SECTION 7. Additional Provisions Concerning the Collateral.
(a) The Debtor hereby authorizes the Secured Party to file,
without the signature of the Debtor where permitted by law, one or more
financing or continuation statements, and amendments thereto, relating to the
Collateral.
(b) To the extent permitted by applicable law, the Debtor hereby
irrevocably constitutes and appoints the Secured Party, with full power of
substitution, as the Debtor's true and lawful attorney-in-fact and proxy (which
appointment as attorney-in-fact and proxy is coupled with an interest)
effective upon demand under the Note, without requiring the Secured Party to
act as such, with full authority in the place and stead of the Debtor and in
the name of the Debtor or otherwise, from time to time in the Secured Party's
discretion, to take any action and to execute any instrument which the Secured
Party may deem necessary or advisable to perfect and continue Secured Party's
lien and security interest in and to protect and preserve the Collateral and
otherwise to accomplish the purposes of this Agreement (subject to the rights
of the Debtor under Section 6(a) hereof), including, without limitation, to
receive, indorse and collect all instruments made payable to the Debtor
representing any dividend or other distribution in respect of any Pledged
Collateral and to give full discharge for the same, and to execute any
financing statement in the name of the Debtor and to file any claims or
institute any proceedings to enforce the rights of the Secured Party with
respect to the Collateral.
(c) If the Debtor fails to perform any agreement or obligation
contained herein, the Secured Party may perform, or cause performance of, such
agreement or obligation,
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and the expenses of the Secured Party incurred in connection therewith shall be
payable by the Debtor pursuant to Section 9 hereof.
(d) The powers conferred on the Secured Party hereunder are
solely to protect the Secured Party's interest in and rights regarding the
Collateral and shall not impose any duty upon the Secured Party to exercise any
such powers. Other than the exercise of reasonable care to assure the safe
custody of the Pledged Collateral while held hereunder, the Secured Party shall
have no duty or liability as to any of the Collateral, including, without
limitation, to preserve rights pertaining thereto and shall be relieved of all
responsibility for the Pledged Collateral upon surrendering it or tendering
surrender of it to the Debtor. The Secured Party shall be deemed to have
exercised reasonable care in the custody and preservation of the Pledged
Collateral in Secured Party's possession if the Pledged Collateral is accorded
treatment substantially equal to that which the Secured Party accords the
Secured Party's own property, it being understood that the Secured Party shall
not have responsibility for (i) ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relating to
any Pledged Collateral, whether or not the Secured Party has or is deemed to
have knowledge of such matters, or (ii) taking any necessary steps to preserve
rights against any parties with respect to any Pledged Collateral.
(e) The Secured Party may at any time in Secured Party's
discretion (i) without notice to the Debtor, transfer or register in the name
of the Secured Party or any of the Secured Party's nominees any or all of the
Pledged Collateral, subject only to the revocable rights of the Debtor under
Section 6(a) hereof, and (ii) exchange certificates or instruments constituting
Pledged Collateral for certificates or instruments of smaller or larger
denominations.
SECTION 8. Remedies Upon Default. After demand has been made under the
Note and so long as it has not been rescinded:
(a) The Secured Party may exercise in respect of the Collateral,
in addition to other rights and remedies provided for herein or otherwise
available to the Secured Party, all of the rights and remedies of a secured
party on default under Article 9 of the Uniform Commercial Code then in effect
in the State of Texas (whether or not the Code applies to the affected
Collateral), and in addition thereto and cumulative thereof, the following
rights: the right to sell, assign or otherwise dispose of the Collateral and
without notice except as specified below, sell or otherwise transfer the
Pledged Collateral at public or private sale, at any of the Secured Party's
offices or elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Secured Party may deem commercially reasonable. In the event
that the Secured Party deems it advisable to do so, the Secured Party may (i)
restrict the bidders or purchasers of any such sale, and notwithstanding that
the Pledged Collateral may not be of a type customarily sold in a recognized
market or which is the subject of widely distributed standard price quotations,
offer the Pledged Collateral for sale to a person or entity in a private sale
at such price and on such terms as the Secured Party shall deem fair, or (ii)
the Secured Party may be the purchaser of any or all of the Pledged Collateral
so sold and may apply the purchase price therefor to reduction of any
Obligation secured hereby in any order as the Secured Party shall select. The
Debtor agrees that, to the extent that notice of sale shall be required by law,
at least ten (10) days notice to the Debtor of the time and place of any public
sale or the time after which any private sale I is to be
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made shall constitute reasonable notification. The Secured Party shall not be
obligated to make any sale of Pledged Collateral regardless of notice of sale
having been given. The Secured Party may adjourn any public or private sale
from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to which
it was so adjourned. Each and every method of disposition of the Pledged
Collateral described in this clause (a) shall constitute disposition of the
Pledged Collateral in a commercially reasonable manner.
(b) In the event that the Secured Party determine to exercise
Secured Party's right to sell all or any part of the Pledged Collateral
pursuant to subsection (a) of this Section 8, the Debtor will, at the Debtor's
expense and upon request by the Secured Party: (i) execute and deliver, and
cause each issuer of such Pledged Collateral and the directors and officers
thereof to execute and deliver, all such instruments and documents, and do or
cause to be done all such other acts and things, as may be necessary or, in the
opinion of the Secured Party, advisable to such Pledged Collateral under an
exemption from the provisions of the Securities Act of 1933, as amended, or any
successor statute (the "Securities Act") and from any applicable state
securities laws and (ii) do or cause to be done all such other acts and things
as may be necessary to make such sale of such Pledged Collateral valid and
binding and in compliance with applicable law.
(c) The Secured Party shall have the tight to receive or transfer
all or a portion of the Collateral to the Secured Party to the extent such
Collateral is cash, or readily convertible into cash, and to receive income,
including cash, thereon and hold the income as Collateral, or to apply the
Collateral which is cash or readily convertible into cash or income which is
cash or readily convertible into cash, in whole or in part against the
Obligations in any order as the Secured Party shall select, and such
application shall be deemed to be a disposition of the Collateral in
satisfaction of only that portion of the indebtedness represented by the
Obligations equal to, and in no event to exceed, the amount of such cash
actually applied to such reduction, and the Debtor further agrees that in such
event the Debtor shall remain fully liable for any remaining deficiency under
such Obligations.
(d) THE SECURED PARTY SHALL NOT BE LIABLE FOR ANY LOSS, DAMAGE,
COST OR EXPENSE TO THE DEBTOR BY REASON OF THE EXERCISE BY THE SECURED PARTY OF
THE REMEDIES DESCRIBED IN THIS SECTION 8 OR SECTION 7, OR FROM ANY OTHER ACT OR
OMISSION OF THE SECURED PARTY RELATING THERETO, AS AFORESAID, UNLESS SUCH LOSS
IS CAUSED BY THE WILLFUL MISCONDUCT AND GROSS NEGLIGENCE OF THE SECURED PARTY,
PROVIDED THAT IT IS THE INTENTION OF THE DEBTOR TO INDEMNIFY THE SECURED PARTY
FOR THE CONSEQUENCES OF THE SECURED PARTY'S OWN NEGLIGENCE. NOR SHALL THE
SECURED PARTY BE OBLIGATED TO PERFORM OR DISCHARGE NOR DOES THE SECURED PARTY
HEREBY UNDERTAKE TO PERFORM OR DISCHARGE ANY OBLIGATION, DUTY OR LIABILITY
UNDER ANY OF SAID COLLATERAL UNDER OR BY REASON OF THIS AGREEMENT.
(e) All proceeds received by the Secured Party under subsection
(a) of this Section 8, in respect of any sale of, collection from, or other
realization upon all or any part of the Collateral, and all Collateral
transferred to the Secured Party pursuant to subsection (c) of this Section 8,
may, in the discretion of the Secured Party, be held by the Secured Party as
collateral for, and/or then or at any time thereafter applied in whole or in
part by the Secured Party against, the Obligations in any order as the Secured
Party may select. Any surplus of such
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proceeds and interest accrued thereon, if any, held by the Secured Party and
remaining after payment in full of all of the Obligations shall be paid over to
the Debtor or to whomever may be lawfully entitled to receive such surplus;
provided that the Secured Party shall have no obligation to invest or otherwise
pay interest on any amounts held by the Secured Party in connection with or
pursuant to this Agreement.
(f) All rights and remedies of the Secured Party expressed herein
are in addition to all other rights and remedies possessed by the Secured Party
under the Note and any other agreement or instrument relating to the
Obligations.
SECTION 9. Indemnity, Expenses and Interest.
(a) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE DEBTOR AGREES
TO INDEMNIFY THE SECURED PARTY FROM AND AGAINST ANY AND ALL CLAIMS, LOSSES AND
LIABILITIES ARISING OUT OF OR RESULTING FROM THIS AGREEMENT (INCLUDING, WITHOUT
LIMITATION, LOSS OR DAMAGE ARISING IN CONNECTION WITH AN EXERCISE OF REMEDIES
BY THE SECURED PARTY UNDER SECTION 7 OR 8 AND ENFORCEMENT OF THIS AGREEMENT),
EXCEPT CLAIMS, LOSSES OR LIABILITIES RESULTING FROM THE GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT OF THE SECURED PARTY, PROVIDED THAT IT IS THE INTENTION OF
THE DEBTOR TO INDEMNIFY THE SECURED PARTY FROM THE CONSEQUENCES OF THE SECURED
PARTY'S OWN NEGLIGENCE.
(b) THE DEBTOR AGREES UPON DEMAND TO PAY THE SECURED PARTY THE
AMOUNT OF ANY AND ALL REASONABLE EXPENSES, INCLUDING THE REASONABLE FEES AND
OUT-OF-POCKET EXPENSES OF COUNSEL AND OF ANY EXPERTS AND AGENTS, WHICH THE
SECURED PARTY MAY INCUR IN CONNECTION WITH (i) THE PREPARATION OF THIS
AGREEMENT, (ii) THE CUSTODY, PRESERVATION, USE OR OPERATION OF, OR THE SALE OF,
COLLECTION FROM, OR OTHER REALIZATION UPON, ANY OF THE COLLATERAL, (iii) THE
EXERCISE OR ENFORCEMENT OF ANY OF THE RIGHTS OF THE SECURED PARTY HEREUNDER, OR
(iv) THE FAILURE OF THE DEBTOR TO PERFORM OR OBSERVE ANY OF THE PROVISIONS
HEREOF.
SECTION 10. Miscellaneous.
(a) Construction. The provisions of this Agreement shall be in
addition to those of the Note or other evidence of liability now or hereafter
held by the Secured Party in connection with any of the Obligations, all of
which shall be construed as complementary to each other. Nothing herein
contained shall prevent the Secured Party from enforcing any or all of the
other agreements in accordance with their respective terms.
(b) No Waiver; Enforcement by the Secured Party, Etc. No failure
on the part of the Secured Party to exercise, and no delay in exercising, any
right hereunder, the Note or any other agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right preclude
any other or further exercise thereof or the exercise of any other right. All
rights and remedies of the Secured Party hereunder are cumulative and
concurrent and are in addition to, and not exclusive of, any rights or remedies
provided by law or under any other agreement. The rights of the Secured Party
hereunder against the Debtor are not conditional or contingent on any attempt
by the Secured Party to exercise any of Secured Party's rights under
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any other agreement or any other instrument or other document or against any
other person or entity.
(c) Notices. All notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile or cable
communication) and mailed, telegraphed, telexed, transmitted, cabled or
delivered, if to the Debtor, at the Debtor's address at 00 Xxxxx Xxxxx, X.X.
Xxx 0000, Xxxxxxx, Xxxxx 00000; if to the Secured Party, at the Secured Party's
address at 00 Xxxxx Xxxxx, P.O. Box. 1343, Xxxxxxx, Xxxxx 00000; or as to each
party at such other address as shall be designated by such party in a written
notice to the other. All such notices and other communications shall, when
mailed, telegraphed, telexed, transmitted or cabled, be effective when
deposited in the mail, delivered to the telegraph company, confirmed by telex
answer-back, transmitted by telecopier or delivered to the cable company,
respectively.
(d) Waiver by the Debtor. To the fullest extent permitted by
applicable law, the Debtor waives (i) protest and notice of protest of all
commercial paper at any time held by or on behalf of the Secured Party on which
the Debtor is in any way liable; (ii) notice of intention to accelerate and
notice of acceleration; and (iii) notice and opportunity to be heard, after
acceleration in the manner provided in the Note, before exercise by the Secured
Party of the remedies of self-help or set-off or of other summary procedures
permitted by any applicable law or by any agreement to which the Debtor is a
party, and, except where required hereby or by any applicable law, notice of
any other action taken by the Secured Party.
(e) Amendments, Etc. No amendment of any provision of this
Agreement shall be effective unless it is in writing and signed by the Debtor
and the Secured Party, and no waiver of any provision of this Agreement, and no
consent to any departure by the Debtor therefrom, shall be effective unless it
is in writing and signed by the Secured Party, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
(f) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, except as required
by mandatory provisions of law and except to the extent that the validity or
perfection of the pledge, assignment and security interest granted hereunder,
or remedies hereunder, in respect of any particular Collateral are governed by
the laws of a jurisdiction other than the State of Texas.
(g) Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction, and, to this end,
the provisions hereof are severable. Without limiting the generality of the
foregoing, in the event that any of the Obligations is unenforceable in whole
or in part in any jurisdiction, as to such jurisdiction the lien and security
interest purported to be created hereby in the Collateral shall secure the
remaining Obligations with the same effect as if such unenforceable Obligations
were never secured by such lien and security interest, and the provisions of
this Agreement shall be interpreted accordingly.
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(h) Survival. All of the representations and warranties set forth
herein shall survive until all Obligations are satisfied in full.
(i) Section Headings. Section headings in this Agreement are for
convenience only and shall not in any way limit or affect the meaning or
interpretation of any of the provisions of this Agreement.
(j) Continuing Security Interests. This Agreement, the delivery
of the Pledged Collateral and the filing of a financing statement with the
Secretary of State of the State of Texas creates a continuing security interest
in the Collateral and shall (i) remain in full force and effect until payment
in full of the Obligations; (ii) be binding upon the Debtor, the Debtor"
successors and assigns; and (iii) inure to the benefit of and be enforceable by
the Secured Party, and the Secured Party's devisees, heirs, personal
representatives, transferees and assigns. Without limiting the generality of
the foregoing clause (iii), the Secured Party may assign or otherwise transfer
any of the Secured Party's rights under this Agreement to any other person or
entity, and to the extent of such assignment such person or entity shall
thereupon become vested with all the benefits in respect thereof granted herein
or otherwise to the Secured Party.
(k) Termination. At such time as the Obligations (other than any
Obligations set forth in Section 9 of which neither the Debtor nor the Secured
Party is aware) shall be fully satisfied (i) except as otherwise provided in
Section 9 hereof with respect to the Obligations of the Debtor thereunder, this
Agreement and the liens and security interests created hereby shall terminate
and all rights to the Collateral shall revert to the Debtor, and (ii) the
Secured Party will, upon the Debtor's request and at the Debtor's expense, (A)
return to the Debtor such of the Pledged Collateral as shall not have been sold
or otherwise disposed of or applied pursuant to the terms hereof, and (B)
execute and deliver to the Debtor such documents as the Debtor shall reasonably
request to evidence such termination.
(l) Lien and Security Interest Absolute. To the fullest extent
permitted by applicable law, all liens and security interests and other rights
of the Secured Party, and all obligations of the Debtor, hereunder shall be
absolute and unconditional irrespective of: (i) any lack of validity or
enforceability of the Note or any other agreement or security document or
instrument relating thereto or executed in connection therewith; (ii) any
change in the time, manner or place of payment of, or in any other term in
respect of, all or any of the Obligations, or any amendment or waiver of or
consent to any departure from the Note or any other agreement or security
document or instrument relating thereto or executed in connection therewith,
including, without limitation, any release or amendment or waiver of or consent
to departure from any guaranty for all or any of the Obligations; (iii) any
increase in, addition to, exchange or release of, or non-perfection of any lien
on or security interest in, or other charge or encumbrance on, any of the
Collateral or any other collateral; (iv) the absence of any action on the part
of the Secured Party to obtain payment or performance of any of the Obligations
from the Debtor or any obligation of any other person or entity, or; (v) any
other event or circumstance which might otherwise constitute a release of, or a
defense available to, or a discharge of, the Debtor or any other person or
entity (including any guarantor) in respect of the Obligations or this
Agreement or the Note.
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(m) Waiver of Marshalling. All rights of marshalling of assets of
the Debtor, including any such right with respect to the Collateral, are hereby
waived by the Debtor.
(n) Limitation by Law. All rights, remedies and powers provided
in this Agreement may be exercised only to the extent that the exercise thereof
does not violate any applicable provision of law, and all of the provisions of
this Agreement are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Agreement invalid, unenforceable,
in whole or in part, or not entitled to be recorded, registered or filed under
the provisions of any applicable law.
(o) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together constitute but one and the same instrument.
(p) Entire Agreement. This Agreement and the Note embody the
entire agreement between the parties as to the subject matter hereof and
thereof and supersede all prior agreements and understandings relating to the
subject matter hereof and thereof. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, THIS AGREEMENT AND THE NOTE REPRESENT THE FINAL AGREEMENT BETWEEN
THE PARTIES AS TO THE SUBJECT MATTER HEREOF AND THEREOF AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
THE "DEBTOR"
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Xxxxxx X. Xxxx, co-Trustee of the Xxxxxx Xxxxxxxx
GST Trust [number of Trust]
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Xxxx X. Xxxxxx, Xx., co-Trustee of the Xxxxxx Xxxxxxxx
GST Trust [number of Trust]
THE "SECURED PARTY"
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C. Xxxxxx Xxxxxxxx
