EXHIBIT 99.4
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT, dated as of April 25, 2002 (this "Agreement"),
is by and between VERSO TECHNOLOGIES, INC., a Minnesota corporation with its
chief executive office and principal place of business located at 000 Xxxxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx 00000 (the "Pledgor"), and WA TELCOM
PRODUCTS CO., INC., a Delaware corporation (the "Pledgee").
WHEREAS, pursuant to Section 1.2(c) of that certain Stock Purchase
Agreement, dated as of July 4, 2001, by and among the Pledgor and the Pledgee,
as amended by that certain Closing Agreement, dated as of July 27, 2001 (as so
amended, the "Purchase Agreement"), on March 31, 2002, the Pledgor shall pay to
the Pledgee the Deferred Amount (as defined in the Purchase Agreement);
WHEREAS, it is proposed that the Pledgor's obligation to pay the
Deferred Amount be restructured pursuant to the terms and conditions of that
certain Convertible Secured Promissory Note, dated as of the date hereof (the
"Note"), by the Pledgor in favor of the Pledgee; and
WHEREAS, it is a condition to the Pledgee's willingness to agree to
such a restructuring that the Pledgor executes and delivers this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:
SECTION 1. PLEDGE. As collateral security for the Secured Obligations
(as hereafter defined), the Pledgor hereby pledges, hypothecates, assigns,
transfers, sets over and delivers unto the Pledgee, and grants to the Pledgee a
security interest in, all of the Pledgor's right, title and interest in, to and
under the following (collectively, the "Collateral"):
(a) all shares of common stock, par value $.01 per share, of NACT
Telecommunications, Inc. ("NACT") owned or held by the Pledgor and all shares
of common stock, par value $.01, per share, of Xxxxxxxx.xxx Software, Inc.
("Telemate") owned or held by the Pledgor (all such shares being referred to as
the "Pledged Shares");
(b) all certificates representing the Pledged Shares, and all
cash, securities, dividends, rights and other property at any time and from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Pledged Shares; provided, however, that the
Pledgee acknowledges and agrees that the certificates representing the Pledged
Shares will not be delivered to the Pledgee until the termination of that
certain Pledge Agreement by and between Silicon Valley Bank and the Pledgor
(the "Pledge Agreement").
(c) all other property hereafter delivered to the Pledgee in
substitution for or in addition to the foregoing, all certificates and
instruments representing or evidencing such property and all cash, securities,
interests, dividends, rights, and other property at any time and from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all thereof; and
(d) all rights, titles, interests, powers, privileges and
preferences pertaining to any of the foregoing.
SECTION 2. OBLIGATIONS SECURED. This Agreement is made, and the security
interest created hereby is granted to the Pledgee, to secure the prompt
performance and payment in full of the following (collectively, the "Secured
Obligations"): (a) all Obligations (as defined in the Parent Security
Agreement); (b) all of the Pledgor's obligations under this Agreement; and (c)
all reasonable costs and expenses incurred by the Pledgee in connection with
the realization of the security for which this Agreement provides, including,
without limitation, all reasonable costs and expenses of any proceedings to
which this Agreement may give rise.
SECTION 3. REPRESENTATIONS AND WARRANTIES. The Pledgor hereby represents
and warrants to the Pledgee as follows:
(a) Validly Issued, etc. All of the Pledged Shares have been
validly issued and are fully paid and nonassessable. The Pledged Shares
constitute all of the issued and outstanding shares of capital stock of NACT
and Telemate. Other than the Pledged Shares, the Pledgor owns no shares of
capital stock or any other equity security of NACT or Telemate. Except as set
forth in the Pledge Agreement, the Pledgor is not a party to or bound by any
agreement affecting or relating to its right to transfer or vote the Pledged
Shares. There is not outstanding, nor is NACT or Telemate bound by, any
subscriptions, options, preemptive rights, warrants, calls, commitments or
agreements or rights of any character requiring NACT or Telemate to issue, or
entitling any Person to acquire, any additional shares of capital stock or any
other equity security of NACT or Telemate, as the case may be.
(b) Title and Liens. The Pledgor is the legal and beneficial
owner of the Collateral and none of the Collateral is subject to any Lien other
than Permitted Liens. No financing statement under the Uniform Commercial Code
of any jurisdiction which names the Pledgor as debtor or covers any of the
Collateral, or any other notice filed in the public records indicating the
existence of a Lien thereon, has been filed and is still effective in any state
or other jurisdiction, other than Uniform Commercial Code financing statements
filed in favor of the Pledgee or in connection with a Permitted Lien, and the
Pledgor has not signed any such financing statement or notice or any security
agreement authorizing the filing of any such financing statement or notice,
other than Uniform Commercial Code financing statements filed in favor of the
Pledgee or in connection with a Permitted Lien.
(c) Name; Chief Executive Office. The correct corporate name of
the Pledgor is set forth in the first paragraph of this Agreement. The chief
executive office and
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principal place of business of the Pledgor and the location of the Pledgor's
books and records relating to the Collateral are located at the address of the
Pledgor set forth in the first paragraph of this Agreement.
SECTION 4. COVENANTS. The Pledgor hereby unconditionally covenants and
agrees as follows:
(a) No Liens; No Sale of Collateral. The Pledgor will not create,
assume, incur or permit or suffer to exist or to be created, assumed or
incurred, any Lien on any of the Collateral (or any interest therein), other
than Permitted Liens, and will not, without the prior written consent of the
Pledgee, sell, lease, assign, transfer or otherwise dispose of all or any
portion of the Collateral (or any interest therein).
(b) Change of Locations, Name, Etc. Without giving the Pledgor at
least 15 business days' prior written notice, the Pledgor will not (i) change
the Pledgor's chief executive office, principal place of business, or the
location of its books and records relating to the Collateral or (ii) change its
name, identity or structure.
(c) Notice of Event of Default. Promptly upon Knowledge of the
Pledgor of the occurrence of any Event of Default, the Pledgor shall notify the
Pledgee in writing thereof, which notice shall set forth the details of such
Event of Default and the actions, if any, being taken or proposed to be taken
with respect thereto.
SECTION 5. ADDITIONAL SHARES. The Pledgor shall not permit NACT or
Telemate to issue any additional shares of capital stock unless such capital
stock is pledged hereunder as provided in this Section. Further, the Pledgor
shall not permit NACT or Telemate to amend or modify its articles or
certificate of incorporation or by-laws in a manner which would adversely
affect the voting, liquidation, preference or other similar rights of the
Pledgor pledged hereunder. The Pledgor agrees that any additional capital stock
of NACT or Telemate at any time issued to the Pledgor or otherwise acquired by
the Pledgor shall be promptly delivered or otherwise transferred to the Pledgee
as additional Collateral and shall be subject to the Lien of, and the terms and
conditions of, this Agreement.
SECTION 6. VOTING RIGHTS.
(a) So long as no Event of Default shall have occurred and be
continuing, the Pledgor shall be entitled to exercise any and all voting and/or
consensual rights and powers accruing to an owner of the Collateral or any part
thereof for any purpose not inconsistent with the terms and conditions of this
Agreement or any agreement giving rise to or otherwise relating to any of the
Secured Obligations; provided, however, that the Pledgor shall not exercise, or
refrain from exercising, any such right or power if any such action would have
a materially adverse effect on the value of such Collateral in the reasonable
judgment of the Pledgee.
(b) Upon the occurrence and during the continuance of an Event of
Default, all rights of the Pledgor to exercise the voting and/or consensual
rights and powers which the Pledgor is entitled to exercise pursuant to
subsection (a) above shall cease, and all
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such rights thereupon shall become immediately vested in the Pledgee, which
shall have, to the extent permitted by law, the sole and exclusive right and
authority to exercise such voting and/or consensual rights and powers which the
Pledgor shall otherwise be entitled to exercise pursuant to subsection (a)
above.
SECTION 7. "EVENT OF DEFAULT" DEFINED. For purposes of this Agreement,
"Event of Default" shall mean any of the following events: (i) any material
breach by the Pledgor of any of its covenants or agreements contained herein
and such failure is not cured within ten (10) days after the Pledgor's receipt
of written notice of such failure; (ii) a breach of any of the Pledgor's
representations or warranties contained herein which has had, or would
reasonably be expected to have, a Material Adverse Effect, and such breach is
not cured within ten (10) days after the Pledgor's receipt of written notice of
such breach; or (iii) the occurrence of an Event of Default under, and as
defined in, any other Transaction Document.
SECTION 8. REMEDIES UPON DEFAULT.
(a) In addition to any right or remedy that the Pledgee may have
under the Note, the Guaranty, the other Transaction Documents or otherwise
under Applicable Law, if an Event of Default shall have occurred and be
continuing, the Pledgee may exercise any and all the rights and remedies of a
secured party under the Uniform Commercial Code as in effect in any applicable
jurisdiction and may otherwise sell, assign, transfer, endorse and deliver the
whole or, from time to time, any part of the Collateral at a public or private
sale or on any securities exchange, for cash, upon credit or for other
property, for immediate or future delivery, and for such price or prices and on
such terms as the Pledgee in its discretion shall deem appropriate. The Pledgee
shall be authorized at any sale (if it deems it advisable to do so) to restrict
the prospective bidders or purchasers to Persons who will represent and agree
that they are purchasing the Collateral for their own account in compliance
with the Securities Act and upon consummation of any such sale the Pledgee
shall have the right to assign, transfer, endorse and deliver to the purchaser
or purchasers thereof the Collateral so sold. Each purchaser at any sale of
Collateral shall take and hold the property sold absolutely free from any claim
or right on the part of the Pledgor, and the Pledgor hereby waives (to the
fullest extent permitted by Applicable Law) all rights of redemption, stay
and/or appraisal which the Pledgor now has or may at any time in the future
have under any Applicable Law now existing or hereafter enacted. The Pledgor
agrees that, to the extent notice of sale shall be required by Applicable Law,
at least ten (10) days' prior written notice to the Pledgor of the time and
place of any public sale or the time after which any private sale is to be made
shall constitute reasonable notification, but notice given in any other
reasonable manner or at any other reasonable time shall also constitute
reasonable notification. Such notice, in case of public sale, shall state the
time and place for such sale, and, in the case of sale on a securities
exchange, shall state the exchange on which such sale is to be made and the day
on which the Collateral, or portion thereof, will first be offered for sale at
such exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Pledgee may fix and
shall state in the notice or publication (if any) of such sale. At any such
sale, the Collateral, or portion thereof to be sold, may be sold in one lot as
an entirety or in
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separate parcels, as the Pledgee may determine in its sole and absolute
discretion. The Pledgee shall not be obligated to make any sale of the
Collateral if it shall determine not to do so regardless of the fact that
notice of sale of the Collateral may have been given. The Pledgee may, without
notice or publication, adjourn any public or private sale or cause the same to
be adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case the sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Pledgee until the sale price is paid by the purchaser or
purchasers thereof, but the Pledgee shall not incur any liability to the
Pledgor in case any such purchaser or purchasers shall fail to take up and pay
for the Collateral so sold and, in case of any such failure, such Collateral
may be sold again upon like notice. At any public sale made pursuant to this
Agreement, the Pledgee, to the extent permitted by Applicable Law, may bid for
or purchase, free from any right of redemption, stay and/or appraisal on the
part of the Pledgor (all said rights being also hereby waived and released to
the extent permitted by Applicable Law), any part of or all the Collateral
offered for sale and may make payment on account thereof by using any claim
then due and payable to the Pledgee from the Pledgor as a credit against the
purchase price, and the Pledgee may, upon compliance with the terms of sale and
to the extent permitted by Applicable Law, hold, retain and dispose of such
property without further accountability to the Pledgor therefor. For purposes
hereof, a written agreement to purchase all or any part of the Collateral shall
be treated as a sale thereof; the Pledgee shall be free to carry out such sale
pursuant to such agreement and the Pledgor shall be entitled to the return of
any Collateral subject thereto, notwithstanding the fact that after the Pledgee
shall have entered into such an agreement all Events of Default may have been
remedied or the Secured Obligations may have been paid in full as herein
provided. The Pledgor hereby waives any right to require any marshaling of
assets and any similar right.
(b) In addition to exercising the power of sale herein conferred
upon it, the Pledgee shall also have the option to proceed by suit or suits at
law or in equity to foreclose this Agreement and sell the Collateral or any
portion thereof pursuant to judgment or decree of a court or courts having
competent jurisdiction.
(c) The rights and remedies of the Pledgee under this Agreement
are cumulative and not exclusive of any rights or remedies which it would
otherwise have.
(d) The Pledgee acknowledges and agrees that the exercise of its
rights and remedies under this Agreement is subject to the terms and conditions
of that certain Subordination Agreement, dated the date hereof, by and among
Silicon Valley Bank, the Pledgor, NACT, Telemate and the Pledgee.
SECTION 9. APPLICATION OF PROCEEDS OF SALE AND CASH. The proceeds of any
sale of the whole or any part of the Collateral, together with any other moneys
held by the Pledgee under the provisions of this Agreement, shall be applied by
the Pledgee in the order determined by the Pledgee, with the balance (if any)
of such proceeds after the payment in full of the Secured Obligations to be
paid to the Pledgor or to whomsoever
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may be legally entitled thereto. The Pledgor shall remain liable and will pay,
on demand, any deficiency remaining in respect of the Secured Obligations.
SECTION 10. PLEDGEE APPOINTED ATTORNEY-IN-FACT. The Pledgor hereby
constitutes and appoints the Pledgee as the attorney-in-fact of the Pledgor
with full power of substitution either in the Pledgee's name or in the name of
the Pledgor to do any of the following: (a) to perform any obligation of the
Pledgor hereunder in the Pledgor's name or otherwise; (b) to ask for, demand,
xxx for, collect, receive, receipt and give acquittance for any and all moneys
due or to become due under and by virtue of any Collateral; (c) to prepare,
execute, file, record or deliver notices, assignments, financing statements,
continuation statements, applications for registration or like papers to
perfect, preserve or release the Pledgee's security interest in the Collateral
or any of the documents, instruments, certificates and agreements described in
Section 12; (d) to verify facts concerning the Collateral in its own name or a
fictitious name; (e) to endorse checks, drafts, orders and other instruments
for the payment of money payable to the Pledgor, representing any interest or
dividend or other distribution payable in respect of the Collateral or any part
thereof or on account thereof and to give full discharge for the same; (f) to
exercise all rights, powers and remedies which the Pledgor would have, but for
this Agreement, under the Collateral; and (g) to carry out the provisions of
this Agreement and to take any action and execute any instrument which the
Pledgee may deem necessary or advisable to accomplish the purposes hereof, and
to do all acts and things and execute all documents in the name of the Pledgor
or otherwise, deemed by the Pledgee as necessary, proper and convenient in
connection with the preservation, perfection or enforcement of its rights
hereunder. Nothing herein contained shall be construed as requiring or
obligating the Pledgee to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by it, or to present or file any
claim or notice, or to take any action with respect to the Collateral or any
part thereof or the moneys due or to become due in respect thereof or any
property covered thereby, and no action taken by the Pledgee or omitted to be
taken with respect to the Collateral or any part thereof shall give rise to any
defense, counterclaim or offset in favor of the Pledgor or to any claim or
action against the Pledgee. The power of attorney granted herein is irrevocable
and coupled with an interest.
SECTION 11. REIMBURSEMENT OF LENDER. The Pledgor agrees to pay upon
demand to the Pledgee the amount of any and all reasonable expenses, including
the reasonable fees, disbursements and other charges of its counsel and of any
experts or agents, and its fully allocated internal costs, that the Pledgee may
incur in connection with (a) the administration of this Agreement, (b) the
custody or preservation of, or any sale of, collection from, or other
realization upon, any of the Collateral, (c) the exercise or enforcement of any
of the rights of the Pledgee hereunder, or (d) the failure by the Pledgor to
perform or observe any of the provisions hereof. Any such amounts payable as
provided hereunder shall be Secured Obligations.
SECTION 12. FURTHER ASSURANCES. The Pledgor shall, at its sole cost and
expense, take all action that may be necessary or desirable in the Pledgee's
reasonable discretion, so as at all times to maintain the validity, perfection,
enforceability and priority of the Pledgee's security interest in the
Collateral, or to enable the Pledgee to exercise or
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enforce its rights hereunder, including, without limitation, (a) delivering to
the Pledgee, endorsed or accompanied by such instruments of assignment as the
Pledgee may specify, any and all chattel paper, instruments, letters of credit
and all other advices of guaranty and documents evidencing or forming a part of
the Collateral and (b) executing and delivering financing statements, pledges,
designations, notices and assignments, in each case in form and substance
satisfactory to the Pledgee, relating to the creation, validity, perfection,
priority or continuation of the security interest granted hereunder. The
Pledgor agrees to take, and authorizes the Pledgee to take on the Pledgor's
behalf, any or all of the following actions with respect to any Collateral as
the Pledgee shall reasonably deem necessary to perfect the security interest
and pledge created hereby or to enable the Pledgee to enforce its rights and
remedies hereunder: (i) to register in the name of the Pledgee any Collateral
in certificated or uncertificated form; (ii) to endorse in the name of the
Pledgee any Collateral issued in certificated form; and (iii) by book entry or
otherwise, identify as belonging to the Pledgee a quantity of securities that
constitutes all or part of the Collateral registered in the name of the
Pledgee. Notwithstanding the foregoing, the Pledgor agrees that Collateral
which is not in certificated form or is otherwise in book-entry form shall be
held for the account of the Pledgee. The Pledgor hereby authorizes the Pledgee
to execute and file in all necessary and appropriate jurisdictions (as
determined by the Pledgee) one or more financing or continuation statements (or
any other document or instrument referred to in the immediately preceding
clause (b)) in the name of the Pledgor and to sign the Pledgor's name thereto.
The Pledgor authorizes the Pledgee to file any such financing statement,
document or instrument without the signature of the Pledgor to the extent
permitted by Applicable Law. To the extent permitted by Applicable Law, a
carbon, photographic, xerographic or other reproduction of this Agreement or
any financing statement is sufficient as a financing statement. Any property
comprising part of the Collateral required to be delivered to the Pledgee
pursuant to this Agreement shall be accompanied by proper instruments of
assignment duly executed by the appropriate Pledgor and by such other
instruments or documents as the Pledgee may reasonably request.
SECTION 13. SECURITIES ACT. In view of the position of the Pledgor in
relation to the Collateral, or because of other current or future
circumstances, a question may arise under the Securities Act or any similar
Applicable Law hereafter enacted analogous in purpose or effect (the Securities
Act and any such similar Applicable Law as from time to time in effect being
called the "Federal Securities Laws") with respect to any disposition of the
Collateral permitted hereunder. The Pledgor understands that compliance with
the Federal Securities Laws might limit the course of conduct of the Pledgee if
the Pledgee were to attempt to dispose of all or any part of the Collateral in
accordance with the terms hereof, and might also limit the extent to which or
the manner in which any subsequent transferee of any Collateral could dispose
of the same. Similarly, there may be other legal restrictions or limitations
affecting the Pledgee in any attempt to dispose of all or part of the
Collateral in accordance with the terms hereof under applicable Blue Sky or
other state securities laws or similar Applicable Law analogous in purpose or
effect. The Pledgor recognizes that in light of the foregoing restrictions and
limitations the Pledgee may, with respect to any sale of the Collateral, limit
the purchasers to those who will agree, among other things, to acquire such
Collateral for their own account, for investment, and not with a view to the
distribution or resale thereof. The Pledgor
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acknowledges and agrees that in light of the foregoing restrictions and
limitations, the Pledgee, in its sole and absolute good faith discretion, may,
in accordance with Applicable Law, (a) proceed to make such a sale whether or
not a registration statement for the purpose of registering such Collateral or
part thereof shall have been filed under the Federal Securities Laws and (b)
approach and negotiate with a single potential purchaser to effect such sale.
The Pledgor acknowledges and agrees that any such sale might result in prices
and other terms less favorable to the seller than if such sale were a public
sale without such restrictions. In the event of any such sale, the Pledgee
shall incur no responsibility or liability for selling all or any part of the
Collateral in accordance with the terms hereof at a price that the Pledgee, in
its sole and absolute discretion, may in good xxxxx xxxx reasonable under the
circumstances, notwithstanding the possibility that a substantially higher
price might have been realized if the sale were deferred until after
registration as aforesaid or if more than a single purchaser were approached.
The provisions of this Section will apply notwithstanding the existence of a
public or private market upon which the quotations or sales prices may exceed
substantially the price at which the Pledgee sells.
SECTION 14. INDEMNIFICATION. The Pledgor agrees to indemnify and hold the
Pledgee and any corporation controlling, controlled by, or under common control
with, the Pledgee and any officer, attorney, director, shareholder, agent or
employee of the Pledgee or any such corporation (each an "Indemnified Person"),
harmless from and against any claim, loss, damage, action, cause of action,
liability, cost and expense or suit of any kind or nature whatsoever
(collectively, "Losses"), brought against or incurred by an Indemnified Person,
in any manner arising out of or, directly or indirectly, related to or
connected with the exercise by the Pledgee of any of its rights and remedies
under this Agreement or any other action taken by the Pledgee pursuant to the
terms of this Agreement; provided, however, the Pledgor shall not be liable to
an Indemnified Person for any Losses to the extent that such Losses result from
the negligence or willful misconduct of such Indemnified Person. The Pledgor's
obligations under this section shall survive the termination of this Agreement
and the payment in full of the Secured Obligations.
SECTION 15. SECURITY INTEREST ABSOLUTE. All rights of the Pledgee
hereunder, the grant of a security interest in the Collateral and all
obligations of the Pledgor hereunder, shall be absolute and unconditional
irrespective of (a) any lack of validity or enforceability of the Note, the
Guaranty or any other Transaction Document, any agreement with respect to any
of the Secured Obligations or any other agreement or instrument relating to any
of the foregoing, (b) any change in the time, manner or place of the payment
of, or in any other term of, all or any of the Secured Obligations, or any
other amendment or waiver of or any consent to any departure from any of the
documents, instruments or agreements evidencing any of the Secured Obligations,
(c) any exchange, release or nonperfection of any other collateral, or any
release or amendment or waiver of or consent to or departure from any guaranty,
for all or any of the Secured Obligations or (d) any other circumstance that
might otherwise constitute a defense available to, or a discharge of, the
Pledgor in respect of the Secured Obligations or in respect of this Agreement
(other than the indefeasible payment in full of all the Secured Obligations).
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SECTION 16. CONTINUING SECURITY INTEREST. This Agreement shall create a
continuing security interest in the Collateral and shall remain in full force
and effect until it terminates in accordance with its terms. The Pledgor and
the Pledgee hereby agree that the security interest created by this Agreement
in the Collateral shall not terminate and shall continue and remain in full
force and effect notwithstanding the transfer to the Pledgor or any person
designated by it of all or any portion of the Collateral.
SECTION 17. NO WAIVER. Neither the failure on the part of the Pledgee to
exercise, nor the delay on its part in exercising any right, power or remedy
hereunder, nor any course of dealing between the Pledgee and the Pledgor shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power, or remedy hereunder preclude any other or the further
exercise thereof or the exercise of any other right, power or remedy.
SECTION 18. NOTICES. Unless otherwise provided herein, communications
provided for hereunder shall be in writing and shall be mailed, telecopied,
couriered or delivered to any party at its address for notices set forth in the
Note. All such notices and other communications to the Pledgor or the Pledgee
shall be deemed given when delivered personally, mailed by certified mail
(postage pre-paid and return receipt requested), sent by overnight courier
service or faxed (transmission confirmed), or otherwise actually received.
SECTION 19. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
SECTION 20. AMENDMENTS. No amendment or waiver of any provision of this
Agreement nor consent to any departure by the Pledgor herefrom shall in any
event be effective unless the same shall be in writing and signed by the
parties hereto, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
SECTION 21. BINDING AGREEMENT; ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns (including, without limitation, liquidators
and trustees), except that the Pledgor shall not be permitted to assign this
Agreement or any interest herein or in the Collateral, or any part thereof, or
any cash or property held by the Pledgee as collateral under this Agreement.
SECTION 22. TERMINATION. Upon indefeasible payment in full of all of the
Secured Obligations, this Agreement shall terminate. Upon termination of this
Agreement in accordance with its terms the Pledgee agrees to take such actions
as the Pledgor may reasonably request, and at the sole cost and expense of the
Pledgor, (a) to return the Collateral to the Pledgor, and (b) to evidence the
termination of this Agreement, including, without limitation, the filing of any
releases or any termination statements under the Uniform Commercial Code of any
applicable jurisdiction.
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SECTION 23. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under Applicable Law, but if any provision of this Agreement shall be
prohibited by or invalid under Applicable Law, such provisions shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Agreement.
SECTION 24. HEADINGS. Section headings used herein are for convenience
only and are not to affect the construction of or be taken into consideration
in interpreting this Agreement.
SECTION 25. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute but one agreement.
SECTION 26. ENTIRE AGREEMENT. This Agreement and the other Transaction
Documents constitute the entire agreement among the parties hereto with respect
to the subject matter hereof and supersede and preempt any prior written or
oral agreements between the parties hereto which may have related to the
subject matter hereof in any way.
SECTION 27. DEFINITIONS.
As used herein, the following terms have the indicated meanings:
"Applicable Law" has the meaning given such term in the Parent
Security Agreement.
"Guaranty" means that certain Guaranty, dated as of the date hereof,
by NACT and Telemate in favor of the Pledgee.
"Knowledge of the Pledgor" means the actual knowledge of the Chief
Executive Officer, Chief Financial Officer or Chief Operating Officer of the
Pledgor.
"Lien" has the meaning given such term in the Parent Security
Agreement.
"Material Adverse Effect" means (i) a material impairment of the
Pledgor's ability to perform any of the Secured Obligations or of the Pledgee's
ability to enforce the Secured Obligations or to realize upon the Secured
Obligations, (ii) a material impairment of the value of the Collateral or the
amount the Secured Party would be likely to receive in a liquidation of such
Collateral, or (iii) a material impairment of the priority of the Liens in
favor of the Pledgee created hereby.
"Parent Security Agreement" means that certain Security Agreement,
dated as of the date hereof, between the Pledgor and the Pledgee.
"Permitted Lien" has the meaning given such term in the Parent
Security Agreement.
10
"Person" means an individual, corporation, partnership, limited
liability company, association, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Transaction Documents" has the meaning given such term in the Parent
Security Agreement.
11
IN WITNESS WHEREOF, the Pledgor and the Pledgee have executed and
delivered this Pledge Agreement under seal as of this the date first written
above.
VERSO TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
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Title: EVP and CFO
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WA TELCOM PRODUCTS CO., INC.
By: /s/ Xxxxxxx X. Xxxx
----------------------------------------
Name: Xxxxxxx X. Xxxx
--------------------------------------
Title: Vice President and Treasurer
-------------------------------------
