PLEDGE AND SECURITY AGREEMENT
EXHIBIT 10.2
PLEDGE AND SECURITY AGREEMENT (this
“Agreement”), is made as of March [ ], 2020 (the
“Funding Date”) by and among CLR ROASTERS, LLC, a
Florida limited liability company (“Pledgor”),
YOUNGEVITY INTERNATIONAL, INC, a Delaware corporation (the
“Company”); and THE PURCHASERS LISTED ON EXHIBIT A
(individually the "Secured Creditor" and collectively, the
“Secured Creditors”) TO THOSE CERTAIN NOTE PURCHASE
AGREEMENTS, DATED AS OF MARCH [ ], 2020 BETWEEN THE COMPANY AND THE
SECURED CREDITORS (the "Purchase Agreement").
WHEREAS, the Secured Parties have each
entered into a Purchase Agreement with the Company;
WHEREAS, on or after the Funding Date,
the Secured Parties have purchased Notes (the "Notes") in an amount
of up to $5,000,000 from the Company;
WHEREAS, as collateral to secure payment
and performance of the Obligations set forth in the Purchase
Agreement and the Notes, the Company and Pledgor have entered into
this Agreement and Pledgor has granted to the Secured Party a Lien
and security interest in and to all of the Collateral (as defined
below).
NOW, THEREFORE, in consideration of the
premises and the agreements herein and in order to induce the
Secured Creditors to accept the Note, the Pledgor hereby agrees
with the Secured Creditor as follows:
SECTION
1. Definitions. All
terms used in this Agreement which are defined in Article 9 of the
Uniform Commercial Code (the “Code”) currently in
effect in the State of Delaware and which are not otherwise defined
herein shall have the same meanings herein as set forth
therein.
SECTION
2. Pledge and Grant of
Security Interest. (a) As collateral security for all of the
Obligations (as defined in Section 3 hereof), the Pledgor hereby
pledges, assigns and grants to the Secured Creditor a continuing
security interest in all of the property described on Exhibit “B” to this
Agreement (the “Pledged Collateral”); and (ii) all
proceeds of the foregoing.
(b) The
Pledgor hereby represents and warrants to the Secured Creditor as
follows:
(i)
The Pledged
Collateral is not pledged to secure any indebtedness other than the
Notes;
(ii)
The execution,
delivery, and performance of the Pledgor of this Agreement will not
violate any provision of law, any order of any court or other
agency of government, or any agreement or other instrument to which
the Pledgor is a party or by which the Pledgor is bound, or be in
conflict with, result in a breach of or constitute (with due
notice, lapse of time, or both) a default under any such agreement
or other instrument, or result in the creation or imposition of any
lien, charge, or encumbrance of any nature whatsoever upon any of
the property of assets of the Pledgor, except as contemplated by
the provisions of this Agreement;
(iii)
This Agreement
constitutes the legal, valid and binding obligation of the Pledgor
and is enforceable against the Pledgor in accordance with the terms
hereof; and
(iv)
The Pledgor is the
legal and beneficial owner of the Pledged Collateral.
SECTION
3. Security for
Obligations. The security interest created hereby in the
Pledged Collateral constitutes continuing collateral security for
all of the following obligations, whether now existing or hereafter
incurred (the “Obligations”):
(a) the
prompt payment by the Company, as and when due and payable, of all
amounts owing by it in respect of the Notes; and
(b) the
due performance and observance by the Pledgor of all of its other
obligations from time to time existing under this
Agreement.
SECTION
4. Covenants as to the
Pledged Collateral. So long as any of the Obligations shall
remain outstanding, the Pledgor will not create or suffer to exist
any lien, security interest or other charge or encumbrance upon or
with respect to any Pledged Collateral except for the security
interest created hereby.
SECTION
5. Additional Provisions
Concerning the Pledged Collateral. The Pledgor hereby
authorizes the Secured Creditor to file, without the signature of
the Pledgor where permitted by law, one or more financing or
continuation statements, and amendments thereto, relating to the
Pledged Collateral.
SECTION
6. Remedies Upon
Default. If any Event of Default under the Note shall have
occurred and be continuing:
(a) The
Secured Creditors may, exercise in respect of the Pledged
Collateral, in addition to other rights and remedies provided for
herein or otherwise available to them, all of the rights and
remedies of a secured party on default under the Code then in
effect in the State of Delaware, and without limiting the
generality of the foregoing and without notice except as specified
below, sell the Pledged Collateral or any part thereof in one or
more parcels at public or private sale at such price or prices and
on such other terms as the Secured Creditors may deem commercially
reasonable. The Pledgor agrees that, to the extent notice of sale
shall be required by law, at least five days’ 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. The Secured Creditors shall not be obligated to make
any sale of Pledged Collateral regardless of notice of sale having
been given. The Secured Creditors 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.
(b) All
cash proceeds received by the Secured Creditors in respect of any
sale of, collection from, or other realization upon, all or any
part of the Pledged Collateral shall be applied by the Secured
Creditors against the Obligations. Any surplus of such cash or cash
proceeds held by the Secured Creditor sand remaining after payment
in full of all of the Obligations shall be paid over to the Pledgor
or to such person as may be lawfully entitled to receive such
surplus.
(c) In
the event that the proceeds of any such sale, collection or
realization are insufficient to pay all amounts to which the
Secured Creditors are legally entitled, the Company shall remain
liable for the deficiency and the Secured Creditors shall retain
all rights to collect on such Obligations provided by applicable
law.
SECTION
7. Notices, Etc.
All notices and other communications provided for hereunder shall
be in writing and shall be mailed, faxed or delivered, if to the
Company or Pledgor, to them at the Company’s address set
forth above; and if to the Secured Creditors, to the address set
forth opposite their name on Exhibit A hereto; or as to any
of such parties at such other address as shall be designated by
such parties in a written notice to the other parties hereto
complying as to delivery with the terms of this Section 7. All such
notices and other communications shall be effective (i) if mailed,
when deposited in the mail, (ii) if faxed, when the facsimile
transmission is acknowledged as received, or (iii) if delivered,
upon delivery.
SECTION
8. Miscellaneous.
(a) No
amendment of any provisions of this Agreement shall be effective
unless it is in writing and signed by the Pledgor and the Secured
Creditors, and no waiver of any provision of this Agreement, and no
consent to any departure by the Pledgor, shall be effective unless
it is in writing and signed by the Secured Creditors, and then such
waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
(b) No
failure on the part of the Secured Creditors to exercise, and no
delay in exercising, any right hereunder 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. The rights and remedies of the Secured Creditors
provided herein are cumulative and are in addition to, and not
exclusive of, any rights or remedies provided by law.
(c) 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 unenforceabilty without
invalidating the remaining portions hereof or thereof or affecting
the validity or enforceability of such provision on any other
jurisdiction.
(d) This
Agreement shall create a continuing security interest in the
Pledged Collateral and shall (i) remain in full force and effect
until the payment in full or release of the Obligations and (ii) be
binding on the Pledgor and its assigns and shall inure, together
with all rights and remedies of the Secured Creditors hereunder, to
the benefit of the Secured Creditors and their heirs, successors
and assigns.
(e) Upon
the satisfaction in full of the Obligations: (i) this Agreement and
the security interest created hereby shall terminate and all rights
to the Pledged Collateral shall revert to the Pledgor, and (ii) the
Secured Creditors will, upon the Pledgor’s request at the
Pledgor’s expense, (A) return to the Pledgor 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 Pledgor such documents as the Pledgor shall
reasonably request to evidence such termination.
(f) This
Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware, except as required by mandatory
provisions of law and except to the extent that the validity and
perfection or the perfection and the effect of perfection or
non-perfection of the security interest created hereby, or remedies
hereunder, in respect of any particular Pledged Collateral are
governed by the law of a jurisdiction other than the State of
Delaware. The parties hereto agree that all actions or proceedings
arising in connection with this Agreement shall be tried and
litigated exclusively in the State and Federal courts located in
Delaware. The aforementioned choice of venue is intended by the
parties to be mandatory and not permissive in nature, thereby
precluding the possibility of litigation between the parties with
respect to or arising out of this Agreement in any jurisdiction
other than that specified in this paragraph. Each party hereby
waives any right it may have to assert the doctrine of forum non
conveniens or similar doctrine or to object to venue with respect
to any proceeding brought in accordance with this paragraph, and
stipulates that the State and Federal courts located in Delaware
shall have in personam jurisdiction and venue over each of them for
the purpose of litigating any dispute, controversy, or proceeding
arising out of or related to this Agreement. Each party hereby
authorizes and accepts service of process sufficient for personal
jurisdiction in any action against it as contemplated by this
paragraph by registered or certified mail, return receipt
requested, postage prepaid, to its address for the giving of
notices as set forth in this Agreement. Any final judgment rendered
against a party in any action or proceeding shall be conclusive as
to the subject of such final judgment and may be enforced in other
jurisdictions in any manner provided by law.
IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be executed and delivered as of the
date first above written.
YOUNGEVITY
INTERNATIONAL INC.
By: __________________________________ Name:
Xxxxx Xxxxxxx
Title:
President
By: __________________________________ Name:
Title:
SECURED
CREDITORS
[NAME
OF INVESTOR]
By: __________________________________ Name:
Title:
EXHIBIT A
LIST OF SECURED CREDITORS
A-1
EXHIBIT B
COLLATERAL
All of
CLR’s rights to receive $0.225 per pound of green coffee
shipped by it from Xxxxxx Xxxxxx
Importer and Exporter, LTD under that certain Finance,
Security and AR AP Monetization Agreement, dated ________ 2020 by
and between H&H Coffee Group Export Corp., H&H Export Y
Cia. Ltda and CLR.
B-1
