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Exhibit 10.16
REIMBURSEMENT AND PLEDGE AGREEMENT
THIS REIMBURSEMENT AND PLEDGE AGREEMENT (this "Agreement"), dated as
of January 8, 1997, is between KP3, LLC, a Colorado limited liability
company (the "Pledgor"), and PMC International, Inc., a Colorado
corporation (which, together with its successors, assigns, endorsees,
transferees and assignees, is hereinafter referred to as the
"Company").
Recitals
A. The Company gave notice to its shareholders on December 18, 1996
of a proposal to provide financial assistance to a limited liability
company or its successor (the "LLC") in which certain of its directors
and officers had a financial interest, such financial assistance to
take the form of a loan by the Company to the LLC, a guaranty from the
Company of the LLC's obligations to a third party, a pledge of
collateral by the Company to secure the LLC' obligations to a third
party or a combination of the foregoing, such financial assistance not
to exceed $2,000,000.
B. On January 6, 1997, a committee of the Board of Directors of the
Company duly authorized the loans to the Pledgor contemplated hereby
and the Company's providing collateral (the "Bank Collateral") to
Norwest Bank Colorado, National Association (the "Bank") to secure a
loan made by the Bank to the Pledgor in the amount of up to $1,750,000
(the "Loan") pursuant to a Term Loan Agreement dated as of January 8,
1997 (the "Loan Agreement") and any renewal or replacement thereof,
such collateral to be made available for up to a two year period.
C. The Pledgor has agreed to reimburse the Company for any amounts
paid by the Company toward the Loan or for collateral applied by the
Bank to the Loan and has agreed to grant a security interest in all
shares of the Company's common stock held by the LLC, consisting of an
aggregate of 1,643,845 shares (the "Stock"), to secure such
reimbursement obligation and any amounts owed by the Pledgor to the
Company pursuant hereto.
D. The proceeds of the Loan have been used by the Pledgor for the
purpose of prepaying at a discount amounts owed by Pledgor under
Pledgor's promissory note in favor of Xxxx Xxxxx ("Geman") dated July
27, 1995 in the original principal amount of $2,015,000 (the "Geman
Note"), of repaying certain loans made to the Pledgor to pay interest
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on the Geman Note, of repaying a loan made by the Company to the
Pledgor's predecessor in the original principal amount of $250,000 on
January 3, 1997, and of paying interest on the Loan.
E. The Company has agreed to advance to the Pledgor amounts
sufficient to permit payment of interest on the Loan, such advances to
be evidenced by a promissory note or notes as contemplated by Section
1.2.
F. It is a condition precedent to the Company's granting a security
interest in the Bank Collateral to secure the Loan that the Pledgor
execute and deliver to the Company this Agreement, thereby agreeing to
the reimbursement obligation stated herein and pledging the Stock and
any other collateral described herein to the Company. The Pledgor
acknowledges that the Company is relying on this Agreement in granting
a security interest in the Bank Collateral to the Bank.
Agreement
IN CONSIDERATION of the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the Pledgor agrees with the Company as follows:
ARTICLE I
AGREEMENT TO REIMBURSE;
PROMISSORY NOTES
1.1. Agreement to Reimburse. The Pledgor agrees with the Company to
repay and reimburse the Company for any amounts paid by the Company on
the Loan and for the fair market value of any of the Bank Collateral
applied by the Bank toward the Loan, together with interest on such
amounts from the date of such repayment or reimbursement at a rate per
annum equal to 9% per annum through the date of payment, such payment
or reimbursement to be made within 30 days of such payment or
application. If the amounts due hereunder are not repaid to the
Company within such 30 day period, the rate of interest shall increase
to 15% per annum until such amount have been paid in full.
1.2. Interest Loans. The Company hereby agrees to loan to the LLC
amounts sufficient to pay interest on the Loan so long as (i) no Event
of Default (as hereinafter defined) shall have occurred and be
continuing and (ii) the amount of loans made and Bank Collateral
provided would not exceed $2,000,000. The Pledgor shall deliver to
the Company promissory notes substantially in the form of Exhibit A
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(the "Company Notes") hereto to evidence its obligation to repay each
loan made to the Pledgor to pay interest on the Loan.
ARTICLE II
SECURITY INTEREST
2.1. Grant of Security Interest. The Pledgor hereby assigns and
pledges to the Company, and hereby grants to the Company a lien on and
security interest in, (a)(i) all of the Pledgor's right, title and
interest in and to the Stock, including all of Pledgor's rights to
receive the Stock upon payment of the Geman Note pursuant to the terms
of the Stock Pledge Agreement between Pledgor and Geman dated as of
July 26, 1995; (ii) all rights of the Pledgor to receive monies due or
to become due with respect to any or all of the Stock; (iii) all
dividends, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of or in
exchange for or in connection with any or all of the Stock; (iv) all
additional shares of stock of the Company from time to time acquired
by the Pledgor in respect of or in exchange for any or all of the
Stock or otherwise, and the certificates representing such additional
shares, 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 Stock; and (b) all other
property in which the Pledgor at any time has rights and in which at
any time a security interest has been granted to the Company by the
Pledgor (collectively, the "Collateral").
2.2. Obligations Secured. This Agreement secures the payment and
performance of all obligations of the Pledgor to the Company now or
hereafter existing under this Agreement and the Company Notes, and any
agreements entered into pursuant thereto, whether for principal,
interest, fees, expenses or otherwise (all such obligations of the
Pledgor being the "Obligations").
2.3. Delivery of Collateral. All certificates or instruments
representing or evidencing the Collateral shall be delivered to and
held by or on behalf of the Company pursuant hereto, and shall be 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 acceptable to the Company. The Company shall have
the right in its discretion and without notice to the Pledgor to
transfer to or to register in the name of the Company or any of its
nominees any or all of the Collateral.
2.4. Release of Collateral. The Company hereby agrees to release as
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Collateral hereunder (i) such shares of Stock as are necessary to
satisfy the obligations of the Pledgor under the Bedford Options (as
hereinafter defined) upon application of the proceeds of the exercise
of the Bedford Options to repayment of the Loan, (ii) shares of Stock
sold by the Pledgor for the fair market value thereof (but in any
event not less than $1.20 per share) upon application of the net
proceeds of such sale to repayment of the Loan (net proceeds to be
determined after payment of reasonable expenses of sale and any
federal and state income taxes to be incurred by the members of the
Pledgor in connection with such sale), and (iii) such shares of Stock
as to which the Company may agree upon any other repayment of the
Loan.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS
3.1. Representations and Warranties. The Pledgor represents and
warrants as follows (the following representations may be relied upon
by the Company and its agents and attorneys, at any time, including in
connection with the sale of the Collateral following foreclosure):
(a) The Pledgor is a limited liability company that is duly
organized, validly existing and in good standing under the laws of the
State of Colorado, has all requisite power and authority to own its
assets and to carry on its business as now conducted and to enter into
and perform its obligations under this Agreement.
(b) This Agreement has been duly authorized, executed and delivered
by the Pledgor and constitutes a valid and binding obligation of the
Pledgor enforceable against the Pledgor in accordance with its terms.
(c) The Pledgor is the legal and beneficial owner of the Collateral
free and clear of any lien, pledge, charge or encumbrance of any kind
("Lien").
(d) The Pledgor has legal title to and all necessary right and
authority to pledge and assign the Collateral and to deliver the
Collateral. The Collateral is not subject to any restrictions on the
pledge, sale or other transfer thereof and the Pledgor is not party to
any agreement or undertaking that restricts the right to pledge, sell
or transfer the Collateral as contemplated by this Agreement, except
(i) those imposed under applicable federal and state securities laws,
(ii) those contained in options on 335,000 shares of Stock previously
disclosed to the Company (or having such other exercise price, not
below $1.00 per share, to which the Pledgor may agree)(the "Bedford
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Options") as to which all requirements necessary to permit the pledge,
sale or other transfer contemplated by this Agreement shall have been
complied with, and (iii) those contained in the Shareholders Agreement
dated as of December 24, 1996, among PMC International, Inc., Bedford
Capital Financial Corporation, Xxxxxxx X. Xxxxxxxx, Xxxxx X. Xxxxxx
and Xxxxxxxx & Xxxxxx, LLC as to which all requirements necessary to
permit the pledge, sale or other transfer contemplated by this
Agreement have been waived.
(f) The pledge of the Collateral pursuant to this Agreement, the
delivery of the Collateral to the Company or its designee, and the
execution by the Pledgor of a blank stock power will create a valid
and perfected first security interest in the Collateral securing the
payment and performance of the Obligations.
(g) The execution, delivery and performance of this Agreement by the
Pledgor do not and will not (i) violate any provision of the articles
of organization or operating agreement of the Company, (ii) violate
any provision of any law, rule, regulation, order, decree or other
legal obligation having applicability to the Pledgor or the
Collateral, nor (iii) violate, conflict with or result in a breach of
or constitute a default under any document, agreement, lease, license,
permit, authorization, approval or instrument to which the Pledgor is
a party or by which the Pledgor or its property may be bound or
affected.
(h) The Pledgor has not made any contract or arrangement of any kind,
the performance of which contract or arrangement by any other
individual or entity could give rise to a Lien on the Collateral. The
Pledgor has not performed any acts, or entered into any agreement or
contract of any kind, which might prevent the Company from enforcing
any of the terms or conditions of this Agreement or selling the
Collateral following foreclosure or which would limit the Company in
any such enforcement.
(i) The Pledgor hereby makes for the benefit of the Company all
representations made by it for the benefit of the Bank in the Loan
Agreement.
3.2. Covenants and Further Assurances.
(a) The Pledgor agrees that, at any time and from time to time, the
Pledgor will promptly execute and deliver all further instruments and
documents and take all further action that may be reasonably necessary
or desirable, or that the Company may reasonably request, in order to
perfect and protect the assignment and security interest granted or
purported to be granted hereby or to enable the Company to exercise
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and enforce its rights and remedies hereunder with respect to any
Collateral. Pledgor shall provide written notice to Geman of the
Company's security interest in the Collateral in a form satisfactory
to the Company. In the event that any Collateral is delivered to, or
comes within the possession of Pledgor at any time, Pledgor shall
notify Company thereof immediately and shall take all action requested
by Company to effect delivery of the Collateral to the Company and
shall execute and deliver all instruments of transfer and other
documents as shall be requested by Company in its discretion to
perfect the security interest in the Collateral created hereby.
(b) The Pledgor agrees to deliver all cash, instruments and other
property described in Section 3.1 above and all additional shares of
stock described in Section 3.1 above to the Company within five days
after receipt by the Pledgor and to execute all pledge agreements,
security agreements, stock powers, financing statements and all other
documents that the Company deems necessary or advisable to grant the
Company a valid, perfected first priority security interest in such
additional stock or property.
(c) The Pledgor will not take any action with respect to the
Collateral which might have a material adverse effect on the security
interest of the Company hereunder in the Collateral or the value of
the Collateral.
(d) The Company shall offer to the Pledgor to enter into a
registration rights agreement in substantially the form offered to
persons who recently exchanged the Company's preferred stock for
common stock.
(e) The Pledgor hereby agrees to comply, for the benefit of the
Company, with all covenants made for the benefit of the Bank in
Sections 6 and 7 of the Loan Agreement (other than Sections 6.3.1,
6.3.2, 6.3.3 and 6.3.4).
ARTICLE IV
POWERS AND AUTHORIZATIONS
4.1. Voting, Dividends and Other Payments.
(a) So long as there exists no Event of Default (as defined in
Article V hereof):
(i) the Pledgor shall be entitled to exercise any and all voting
and/or consensual rights and powers relating or pertaining to the
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Stock pledged by it or any part thereof for any purpose not
inconsistent with the terms hereof;
(ii) any and all dividends in cash or other property, stock or
liquidating dividends, distributions of property, returns of capital
or other distributions and payments made on or in respect of the
Collateral, whether resulting from a subdivision, combination or
reclassification of the outstanding Collateral or received in exchange
therefor or for any part thereof or as a result of any merger,
consolidation, acquisition or other exchange of assets to which any
such issuer may be a party or otherwise, and any and all cash and
other property received in exchange for or redemption of any
Collateral (in each case, after reservation of an amount necessary to
cover federal or state income taxes incurred in connection therewith),
shall be and become part of the Collateral and, if received by the
Pledgor, at the Pledgor's option, either (A) shall be held in trust by
the Pledgor for the benefit of the Company and forthwith be delivered
by the Pledgor to the Company (registered in the name of the Company,
or accompanied by proper instruments of assignment executed by the
Pledgor) to be held subject to the terms hereof or (B) shall be
applied to payment of principal or interest on the Loan.
(b) Upon the occurrence of an Event of Default all rights of the
Pledgor to exercise the voting and/or consensual rights and powers
which it is entitled to exercise pursuant to Section 4.1(a) shall, at
the Company's option, immediately upon notice to the Pledgor, cease,
and the Company shall be entitled to receive all dividends on the
Collateral, which dividends shall be held as additional Collateral
hereunder.
4.2. Transfers and Other Liens. The Pledgor shall not, without the
prior written consent of the Company:
(a) Sell, assign or otherwise dispose of any of the Collateral,
except pursuant to the Bedford Options or as otherwise permitted under
Section 2.3; or
(b) Create or suffer to exist any Lien upon or with respect to any of
the Collateral, except for the Lien created by this Agreement.
4.3. Company Appointed Attorney-in-Fact. The Pledgor irrevocably
appoints the Company as the Pledgor's attorney-in-fact, with full
authority in the place and stead of the Pledgor and in the name of the
Pledgor or otherwise, from time to time in the Company's discretion,
to take any action and to execute any instrument that the Company may
deem necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation:
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(a) to ask, demand, collect, xxx for, recover, compromise, receive
and give acquittance and receipts for moneys due and to become due
under or in respect of any of the Collateral;
(b) to receive, endorse and collect any drafts or other instruments,
documents and chattel paper, in connection with clause (a) above;
(c) to file any claims or take any action or institute any
proceedings which the Company may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the rights
of the Company with respect to any of the Collateral;
(d) at the Company's option, to effect the transfer of record of the
Collateral in and to the name of the Company and to sell or otherwise
transfer the Collateral in accordance with the terms of this
Agreement; and
(e) at any time after the occurrence of an Event of Default, to
instruct the depository, transfer agent, trustee or holder of the
Collateral to immediately pay over the Collateral to the Company or
sell the Collateral and immediately pay over the proceeds to the
Company.
The Company promptly give notice to the Pledgor of any actions taken
by it pursuant to this Section 4.3.
4.4. Continuing Security Interest; Release of Collateral. This
Agreement shall create a continuing security interest in the
Collateral and shall (a) remain in full force and effect until the
payment in full of the Obligations, (b) be binding upon and inure to
the benefit of the Pledgor, and its successors and assigns, and (c) be
binding upon and inure, together with the rights and remedies of the
Company hereunder, to the benefit of the Company, its successors,
participants, transferees and assigns. Upon the complete and final
payment and performance of the Obligations in full, and upon written
request delivered by the Pledgor to the Company, the security interest
created by this Agreement shall terminate and all rights to the
Collateral shall revert to the Pledgor. Upon such event, the Company
shall, upon the Pledgor's request and at the Pledgor's expense (x)
return to the Pledgor such of the Collateral as shall not have been
sold or otherwise disposed of or applied pursuant to the terms hereof,
and (y) execute and deliver to the Pledgor such documents as the
Pledgor shall reasonably request to evidence such termination. The
termination of the security interests created by this Agreement shall
not terminate or otherwise affect the Company's right or ability to
exercise any right, power or remedy on account of any claim for breach
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of warranty or representation, for failure to perform any covenant or
other agreement, under any indemnity or for fraud, deceit or other
misrepresentation or omission.
ARTICLE V
EVENTS OF DEFAULT AND REMEDIES
5.1. Events of Default. The occurrence of any one or more of the
following events or existence of any one or more of the following
conditions shall constitute an event of default ("Event of Default")
under this Agreement:
(a) The Pledgor shall fail to make any payment when and as due under
the Company Note, or shall fail to observe or perform any term of the
Company Note and such failure shall continue for ten days or more.
(b) The Pledgor shall fail to observe or perform any term of this
Agreement and such failure shall continue for ten days or more.
(c) Any warranty or representation made to the Company in connection
with this Agreement proves to have been false in any material respect
when made or deemed made.
(d) The Pledgor shall become insolvent, admit in writing its
inability to pay its debts as they mature, or make an assignment for
the benefit of creditors; or the Pledgor shall apply for or consent to
the appointment of a receiver or trustee for it or for a substantial
part of its property or business; or such a receiver or trustee
otherwise shall be appointed for the Pledgor and shall not be
discharged within 15 calendar days after such appointment.
(e) The occurrence and continuance of an event of default as
described in Section 8 of the Loan Agreement.
5.2. Remedies. Upon the occurrence of an Event of Default hereunder:
(a) All rights of the Pledgor to exercise the voting and other
consensual rights which it would otherwise be entitled to exercise
pursuant to Section 4.1 shall cease.
(b) All payments received by the Pledgor under or in connection with
the Collateral shall be received in trust for the benefit of the
Company, shall be segregated from other funds of the Pledgor and shall
be forthwith paid over to the Company in the same form as so received
(with any necessary endorsement).
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(c) The Company may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise
available to it, all the rights and remedies of a Company on default
under the Uniform Commercial Code (the "Code") in effect in the State
of Colorado at that time and also may without notice, except as
specified below, sell the Collateral or any part thereof in one or
more parcels at public or private sale, at any of the Company's
offices or elsewhere, for cash, on credit or for future delivery, and
upon such other terms as the Company may deem commercially reasonable.
The Pledgor agrees that, to the extent notice of sale shall be
required by law, at least five calendar days' notice to the Pledgor of
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 be sufficient. The
Company shall have the right to purchase the Collateral at any public
or private sale, and shall have the right to credit upon the amount of
the bid made therefor the amount payable to it out of the net proceeds
of such sale. Without precluding any other methods of sale, the sale
of Collateral shall have been made in a commercially reasonable manner
if conducted in conformity with reasonable commercial practices of
financial institutions disposing of similar property, but in any
event, the Company may sell at its option on such terms as it may
choose without assuming any credit risk and without obligation to
advertise. The Company shall not be obligated to make any sale of
Collateral, regardless of notice of sale having been given. The
Company may adjourn any 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.
(d) The Pledgor recognizes that the Company will be unable to effect
a public sale of any of the Stock by reason of certain prohibitions
contained in the Securities Act of 1933 and other applicable state and
federal securities laws. The Pledgor acknowledges that the Company
may sell the Stock and such other Collateral, if any, that is subject
to such prohibitions privately to a restricted group of purchasers who
agree to purchase such securities for their own account for investment
and not with a view to the distribution or sale thereof, or in any
other manner deemed advisable by the Company, and at such price or
prices as the Company determines in its sole discretion. The Pledgor
acknowledges and agrees that any such private sale may result in
prices and other terms less favorable to the seller than if such sale
were a public sale.
(e) The Pledgor shall be liable for and will pay to the Company, as
soon as incurred, all costs and expenses, including attorneys' fees,
related or incidental to the care, holding, retaking, preparing for
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sale, selling or collection of or realization upon any of the
Collateral or relating or incidental to the establishment or
preserving or enforcement of the rights of the Company hereunder or in
respect of any of the Collateral, and obtaining legal advice related
to any of the foregoing. Further, the Pledgor agrees that any
proceeds of the Collateral, resulting from sale, collection or
otherwise, and other available moneys coming into the hands of the
Company may be applied by the Company, before or after the occurrence
of an Event of Default, to the satisfaction or reduction of such of
the Obligations or costs and expenses as it may see fit, whether or
not matured, in such order as the Company determines.
(f) The Company shall have the right in its discretion and upon
notice to the Pledgor, to transfer to or to register in the name of
the Company or any of its nominees any or all of the Collateral.
(g) Without any notice to the Pledgor, subject to compliance with
notice provisions, if any, required by law, the Company may instruct
the depository, transfer agent, trustee or other holder of the
Collateral to immediately pay over the Collateral to the Company or
sell the Collateral and pay the proceeds to the Company. The Pledgor
hereby authorizes and instructs the depository, trustee, transfer
agent or holder of the Collateral to immediately pay over the
Collateral to the Company or sell the Collateral and pay the proceeds
to the Company upon notice from the Company without the need for any
acknowledgment or consent by the Pledgor or further action on the part
of the Pledgor and the Pledgor hereby agrees to indemnify and hold
harmless the depository, transfer agent, trustee or other holder of
the Collateral from and against any and all claims, demands, causes of
action, losses or expenses as a result of the depository, transfer
agent, trustee or other holder of the Collateral delivering the
Collateral to the Company or liquidating the Collateral and paying the
proceeds to the Company.
(h) The Company may exercise all of the remedies set forth herein
from time to time upon the occurrence of any Event of Default and may
exercise the remedies set forth herein separately in connection with
the occurrence of each Event of Default. The exercise of any remedies
herein in connection with one Event of Default shall not prevent the
Company from exercising any and all remedies set forth herein in
connection with any subsequent Event of Default. The Pledgor
recognizes that the Collateral is of a type that may decline speedily
in value.
5.3. Application of Proceeds. The proceeds of any sale of, or other
realization upon, all or any part of the Collateral shall be applied
by the Company in the following order of priority:
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First, to payment of the expenses of such sale or other realization,
including reasonable compensation to the Company and its agents and
counsel, and all expenses, liabilities and advances incurred or made
by the Company in connection therewith, and any other unreimbursed
expenses for which the Company is to be reimbursed pursuant to this
Agreement or the Company Notes;
Second, to payment of all other Obligations in such order as the
Company shall determine until all such Obligations have been paid in
full; and
Third, to payment to the Pledgor, or its successors or assigns, or as
a court of competent jurisdiction may direct.
ARTICLE VI
MISCELLANEOUS
6.1. Security Interest Absolute. The Pledgor agrees that all rights
of the Company and the assignment and security interest hereunder and
all Obligations of the Pledgor shall be absolute and unconditional,
irrespective of, and the Pledgor hereby consents to:
(a) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations;
(b) any amendment, modification or restatement of any of the terms of
this Agreement or the Company Notes;
(c) any exchange, release or nonperfection of any Collateral; or
(d) any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing, which might otherwise constitute a
defense available to, or a discharge of, the Pledgor.
6.2. Notices. All notices, consents, waivers and other
communications under this Agreement must be in writing and will be
deemed to have been duly given (a) when delivered by hand (including
by a nationally recognized overnight courier service), with written
confirmation of receipt, or (b) when sent by telecopier (with written
confirmation of receipt), provided that a copy is also delivered by
hand (including by a nationally recognized overnight courier service),
with written confirmation of receipt, on the next business day
thereafter, in each case to the addresses listed below:
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If to Pledgor:
KP3, LLC
000 Xxxxxxxxxxx Xxxxxx
14th Floor
Attention: Xxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
With a copy to:
Waldbaum, Corn, Xxxx, Xxxxxx & Xxxxx, P.C.
000 Xxxx Xxxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Company:
PMC International, Inc.
000 Xxxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
With a copy to:
Holme Xxxxxxx & Xxxx, LLP.
0000 Xxxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
Any party may change its address for the giving of notice by providing
notice of such change hereunder.
6.3. Waiver of Rights of Subrogation. The Company hereby waives any
rights of subrogation it may have to enforce against Xxxxxxx X.
Xxxxxxxx under the Continuing Guaranty given by Xx. Xxxxxxxx to the
Bank in connection with the Loan.
6.4. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Colorado.
6.5. Entire Agreement. This Agreement and the Company Notes
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constitute and incorporate the entire agreement between the Company
and the Pledgor concerning the subject matter of this Agreement and
supersede any prior agreements between the Company and the Pledgor
concerning the subject matter hereof.
6.6. Jurisdiction and Venue. At the option of the Company, an action
may be brought to enforce this Agreement in the District Court in and
for the City and County of Denver, State of Colorado, in the United
States District Court for the District of Colorado or in any other
court in which venue and jurisdiction are proper. The Pledgor
consents to venue and jurisdiction in the District Court for the City
and County of Denver, State of Colorado and in the United States
District Court for the District of Colorado and to jurisdiction and
service of process under Sections 13-1-124(1)(a) and 13-1-125,
Colorado Revised Statutes (1973), as amended, in any action commenced
to enforce this Agreement, and hereby irrevocably waives the defense
of inconvenient forum to the maintenance of any such action or
proceeding.
6.7. Severability. The invalidity, illegality or unenforceability of
any provision of this Agreement shall not in any way affect or impair
the legality or enforceability of the remaining provisions of this
Agreement.
6.8. Time of the Essence. Time is of the essence with respect to the
dates, terms and conditions of this Agreement.
6.9. Amendments and Waivers. No amendment or waiver of any provision
of this Agreement nor consent to any departure by the Pledgor here
from, shall in any event be effective unless the same shall be in
writing and signed by the Company, and then such waiver or consent
shall be effective only in the specific instance and for the specific
purpose for which given.
6.10. Facsimile Signatures. This Agreement, and all documents
executed pursuant hereto including without limitation financing
statements, stock powers and other documents evidencing the security
interest created hereby, may be executed and delivered by facsimile
transmission, such execution and delivery to be valid and deemed an
original for all purposes.
IN WITNESS WHEREOF, the Company and the Pledgor have duly executed and
delivered this Agreement as of the date first above written.
COMPANY:
PMC INTERNATIONAL, INC.
By:
Name: Xxxxxxx X. Xxxxx
Title: Corporate Secretary
PLEDGOR:
KP3, LLC,
By:
Name: Xxxxxxx X. Xxxxxxxx
Title: Manager
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