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EXHIBIT 1
EXTENDED AND CONSOLIDATED
PLEDGE AGREEMENT
AGREEMENT made effective as of the 23rd of day May, 1992, between JRG
INVESTMENT CO., INC., a Nevada corporation, referred to herein as the "Pledgor"
and M.S. HOLDING CO. CORP., a Nevada corporation referred to herein as the
"Secured Party".
WHEREAS, Pledgor executed a pledge agreement and that note in the
original amount of $1,686,471.18 Dated May 23, 1991 to Syntek Finance
Corporation and due May 23, 1992 (the "Syntek Loan"), which was sold to
American Realty and further sold to Secured Party;
WHEREAS, Pledgor executed a pledge agreement and that note in the
original amount of $3,313,528.82 Dated May 23, 1991 to International Health
Products, Inc. and due May 23, 1992 (the "International Loan") as sold to
Secured Party;
WHEREAS, to induce Secured Party to extend and accrue the Syntek Loan
and the International Loan (together the "Loan"), the Pledgor has agreed to
execute an extended and consolidated note and continue the pledge of certain
stock as security and will transfer to Secured Party 436,363 shares of Medical
Resource Companies of America, a Nevada corporation ("Medical Resource");
WHEREAS, to induce Secured Party to reduce the interest rate in the
Extended and Consolidated Promissory Note, Pledgor will deposit with the
Secured Party 2,281,818 shares of common stock of Medical Resource.
NOW THEREFORE, in consideration of the extension of the Prior Notes,
and for other valuable consideration, the receipt of which is hereby
acknowledged, Pledgor agrees with Secured Party as follows:
1. Event of Default. The term "Event of Default" means (a) the
occurrence of any Event of Default under the Note (hereinafter defined).
2. Pledge. Upon the terms hereof, Pledgor hereby pledges and
grants to Secured Party a first lien on and security interest (the "Security
Interest") in and to all of the right, title and interest of Pledgor in and to
all of the following instruments and property (all of the following being
herein sometimes called the "Collateral"):
(a) (i) 905,557 shares of the issued and outstanding
Series A preferred stock of Medical Resource, together with all
certificates, options, rights or other distributions issued as an
addition to, in substitution or in exchange for, or on account of, any
such shares, as represented by a true and
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correct copy of certificate NO. P0009 (the "Preferred Certificates",
whether one or more) being held in trust for the Secured Party and
incorporated herein by reference representing 905,557 shares of the
Series A preferred stock of Medical Resource, the originals of this
certificate having been deposited with a trustee or the Secured Party
simultaneously with the Pledgor's execution hereof, (ii) 3,550,000
shares of the issued and outstanding common stock of Medical Resource,
together with all certificates, options, rights or other distributions
issued as an addition to, in substitution or in exchange for, or on
account of, any such shares, as represented by a true and correct copy
of certificates NO. 3687, 3688, 3689, 3690, 3691 (the "Converted
Certificates", whether one or more) being held in trust for the
Secured Party and incorporated herein by reference representing
3,550,000 shares of the common stock of Medical Resource, the
originals of the Certificate having been deposited with a trustee or
the Secured Party simultaneously with the Pledgor's execution hereof
(iii) 2,281,818 shares of the issued and outstanding common stock of
Medical Resource, together with all certificates, options, rights or
other distributions issued as an addition to, in substitution or in
exchange for, or on account of, any such shares, as represented by a
true and correct copy of certificates NO. __________________________
(the "New Certificates", whether one or more, and known together with
the Preferred Certificates and the Converted Certificates as the
"Certificates") being held in trust for the Secured Party and
incorporated herein by reference representing 2,281,818 shares of the
common stock of Medical Resource, the originals of the Certificate
having been deposited with a trustee or the Secured Party
simultaneously with the Pledgor's execution hereof; and (iv) a note
payable to Pledgor from Professional Investors Insurance Group, Inc.
in the amount of Six Hundred Thousand Dollars ($600,000), and all of
the security therefor;
(b) All securities and other property, rights or
interests of any description at any time issued or issuable as an
addition to, in substitution or exchange for, with respect to,
incident to or in lieu of such shares described in Sections 2(a)
hereof or with respect to, incident to or in lieu of the Collateral
(i) due to any dividend, stock-split, stock dividend or distribution
on dissolution, on partial or total liquidation, or other corporate
reorganization, or for any other reason; (ii) in connection with a
reduction of capital, capital surplus or paid-in surplus; or (iii) in
connection with any spin-off, split-off, reclassification,
readjustment, merger, consolidation, sale of assets, combination of
shares or any other plan of distribution affecting the companies which
have issued the shares described in Section 2(a) hereof;
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(c) Any subscription or other rights or options issued in
connection with the shares described in Sections 2 (a) hereof,
including, but not limited to preemptive rights and, if exercised by
the Pledgor, all new shares or other securities so acquired by the
Pledgor, which shall immediately be assigned and delivered to Secured
Party and held under the terms of this agreement (the "Pledge
Agreement") in the same manner as the shares originally pledged
hereunder;
(d) Any and all proceeds, monies, income and benefits
arising from or by virtue of, and all dividends and distributions
(cash or otherwise) payable and/or distributable with respect to, all
or any of the shares or other securities and rights and interests
described herein.
3. Obligations Secured. This Pledge Agreement and the Security
Interest granted hereby secure the prompt repayment of that certain extended
and consolidated promissory note executed by Pledgor of even date herewith (the
"Note").
4. Warranties. Pledgor represents, warrants, covenants and
agrees to and with Secured Party that: (a) Pledgor is the legal and beneficial
owner of the Collateral; (b) the Collateral is duly authorized and issued,
fully paid, and nonassessable; (c) no dispute, right of setoff, counterclaim or
defense exists with respect to all or any part of the Collateral; (d) all of
the shares of the Collateral are owned by the Pledgor free of any pledge,
mortgage, hypothecation, lien, charge, encumbrance or security interest or
purchase right or option on the part of any third person in such shares or the
proceeds thereof, except the Security Interest and those restrictions legended
on the stock certificate which restrictions Pledgor acknowledges are operative
only so long as no Event of Default has occurred; (e) there are no restrictions
upon the transfer of any of the shares constituting the Collateral, other than
those which are operative only so long as no Event of Default has occurred and
which appear on the face of the Certificates; (f) the Pledgor has the full
power, authority and legal right to transfer and pledge the Collateral free of
any encumbrances and without obtaining the consent of the other shareholders of
the issuer of the Collateral; (g) the execution and delivery of this Pledge
Agreement, and the performance of its terms, will not result in any violation
of any provision of the Pledgor's certificate of incorporation or bylaws, or
violate or constitute a default under the terms of any agreement, indenture or
other instrument, license, judgment, decree, order, law, statute, ordinance or
other governmental rule or regulation, applicable to the Pledgor or any of its
property; (h) this Pledge Agreement has been duly authorized, executed and
delivered by the Pledgor and constitutes a legal, valid and binding obligation
of the Pledgor enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights and, to
the extent that such instruments
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require or may require, enforcement by a court of equity, such principles of
equity as the court may have jurisdiction to impose; and (i) upon delivery of
the Collateral to the Secured Party, this Pledge Agreement will create a valid
and perfected first priority lien upon, and security interest in, the
Collateral and the proceeds thereof, securing the payment of the Note. The
delivery at any time by the Pledgor to the Secured Party of Collateral shall
constitute a representation and warranty by the Pledgor under this Pledge
Agreement that, with respect to such Collateral and each item thereof: (1)
Pledgor is the owner of the Collateral; and (2) the matters heretofore
warranted in clauses (a) through (i) of this section are true and correct.
5. Covenants. Pledgor further covenants and agrees: (a) from
time to time promptly to execute, assign, endorse and deliver to Secured Party
all applications, acceptances, stock powers, chattel paper, documents,
instruments or other evidences of payment or writing constituting or relating
to any of the Collateral, and all such other assignments, certificates,
supplemental writings, and financing statements and do all other acts or things
as Secured Party may reasonably request in order more fully to evidence and
perfect the Security Interest; (b) promptly to furnish Secured Party with any
information or writings which Secured Party may reasonably request concerning
the Collateral; (c) to allow Secured Party to inspect all records of Pledgor
relating to the Collateral or to the Note, and to make and take away copies of
such records during normal business hours; (d) promptly to notify Secured Party
of any change in any fact or circumstance warranted or represented by Pledgor
in this Pledge Agreement or in any other writing furnished by Pledgor to
Secured Party in connection with the Collateral or the Note; (e) promptly to
notify Secured Party of any claim, action or proceeding affecting title to the
Collateral, or any part thereof, or the Security Interest, and at the request
of Secured Party, appear in and defend, at Pledgor's expense, any such action
or proceeding; (f) promptly to pay to Secured Party the amount of all court
costs and reasonable attorneys' fees incurred by Secured Party hereunder; (g)
except to the extent prohibited by applicable law, pay all reasonable expenses
incurred in the custody, preservation, use or operation of the Collateral; and
(h) promptly to deliver to Secured Party, in the exact form received, all
securities and other property described in Section 2(b), Section 2(c) and
Section 2(d) hereof which comes into the possession, custody or control of the
Pledgor. Pledgor further covenants and agrees that, without the prior written
consent of Secured Party, Pledgor shall not (x) sell, assign or transfer
Pledgor's rights in the Collateral, or (y) create any other lien or security
interest in, or otherwise encumber any of the Collateral, or permit any of the
Collateral ever to be or become subject to any lien, attachment, execution,
sequestration, other legal or equitable process, or any lien or encumbrance of
any kind. Pledgor further agrees that it will (1) cause the issuers of the
Collateral not to issue any stock or other securities in addition to or in
substitution for the Collateral issued by the issuer, except
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to the Pledgor, and (2) pledge hereunder, immediately upon its acquisition
(directly or indirectly) thereof, any and all additional shares of stock or
other securities of the Collateral. All assignments and endorsements by the
Pledgor shall be in such form and substance as may be satisfactory to the
Secured Party. Should any covenant, duty or agreement of the Pledgor fail to
be performed in accordance with its terms hereunder, the Secured Party may, but
shall never be obligated to, perform or attempt to perform such covenant, duty
or agreement on behalf of the Pledgor, and any amount expended by the Secured
Party in such performance or attempted performance shall become part of the
Note, except to the extent prohibited by applicable law, and, at the request of
the Secured Party, or unless otherwise agreed, the Pledgor agrees to pay such
amount promptly to the Secured Party.
6. Adjustments and Distributions Concerning Collateral. Should
the Collateral, or any part thereof, ever be converted in any manner by its
issuer into another type of property or any money or other proceeds ever be
paid or delivered to Pledgor as a result of Pledgor's rights in the Collateral,
then in any such event (except as provided in Section 7 hereof), all such
property, money and other proceeds shall immediately be and become part of the
Collateral, and Pledgor covenants to pay forthwith and deliver all such
property, money or other proceeds so received to Secured Party; and, if Secured
Party deems it necessary and so requests, to endorse properly or assign any and
all such other proceeds to Secured Party and to deliver to Secured Party any
and all such other proceeds which require perfection by possession under the
Uniform Commercial Code in effect in the State of Texas or other appropriate
jurisdiction (the "UCC"). With respect to any of such property of a kind
requiring an additional security agreement, financing statement or other
writing to perfect a security interest therein in favor of Secured Party,
Pledgor will forthwith execute and deliver to Secured Party whatever Secured
Party shall deem necessary or proper for such purpose.
7. Cash Dividends. Unless an Event of Default shall have
occurred, the Pledgor shall be entitled to receive for its own use cash
dividends on the Collateral paid out of earned surplus. Upon the occurrence of
an Event of Default, the Secured Party may require any such cash dividends to
be delivered to the Secured Party as additional Collateral hereunder or applied
toward repayment of the Note.
8. Registration of Collateral in Name of Secured Party. After an
Event of Default, the Secured Party, at its option, may have any or all of the
Collateral registered in its name or that of its nominee including any
"clearing corporation" or "custodian bank" as defined in the UCC and any
nominee of any of the foregoing, and the Pledgor hereby covenants that, upon
the Secured Party's request, the Pledgor will cause the issuer of the
Collateral to effect such registration. Immediately after an Event of Default
and with or
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without notice, whether or not the Collateral shall have been registered in the
name of the Secured Party or its nominee, the Secured Party or its nominee
shall have, with respect to the Collateral, the right to exercise all voting
rights and all other corporate rights and all conversion, exchange,
subscription or other rights, privileges or options pertaining thereto as if it
were the absolute owner thereof, including, without limitation, the right to
exchange any or all of the Collateral upon the merger, consolidation,
reorganization, recapitalization or other readjustment of the issuer thereof,
or upon the exercise by such issuer of any right, privilege, or option
pertaining to any of the Collateral, and, in connection therewith, to deliver
any of the Collateral to any committee, depositary, transfer agent, registrar
or other designated agency upon such terms and conditions as it may determine,
all without liability except to account for property actually received by it;
but the Secured Party shall have no duty to exercise any of the aforesaid
rights, privileges or options and shall not be responsible for any failure to
do so, delay in doing so, or depreciation in the value of the Collateral by
reason of doing so.
9. Default. Upon the occurrence of an Event of Default, in
addition to any and all other rights and remedies which Secured Party may then
have hereunder, under the UCC or otherwise, Secured Party may at its discretion
and without notice to the Pledgor do any one or more of the following, without
liability except to account for property actually received by it, and Pledgor
agrees that it is commercially reasonable for Secured Party to do any of the
following: (a) declare the entire unpaid balance of principal of and all
accrued, unpaid interest on the Note immediately due and payable without
notice, including without limitation, notice of acceleration and notice of
intent to accelerate, demand, or presentment, which are hereby waived; (b)
transfer to or register in its name or the name of its nominee (if the same has
not already been done) any of the Collateral with or without indication of the
security interest herein created, and whether or not so transferred or
registered, receive the income, dividends and other distributions thereon and
hold them or apply them to the Note in any order of payment; (c) exercise or
cause to be exercised all voting and corporate powers with respect to any of
the Collateral so registered or transferred, including all rights to
conversion, exchange, subscription or any other rights, privileges or options
pertaining to such Collateral, as if the absolute owner thereof; (d) insure any
of the Collateral; (e) exchange any of the Collateral for other property upon a
reorganization, recapitalization or other readjustment and, in connection
therewith, deposit any of the Collateral with any committee or depository upon
such terms as the Secured Party may determine; (f) in its name or in the name
of the Pledgor demand, xxx for, collect or receive any money or property at any
time payable or receivable on account of or in exchange for any of the
Collateral and, in connection therewith, endorse notes, checks, drafts, money
orders, documents of title or other evidences of payment, shipment
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or storage in the name of the Pledgor; (g) make any compromise or settlement
deemed advisable with respect to any of the Collateral; (h) renew, extend, or
otherwise change the terms and conditions of any of the Collateral or the Note;
(i) take or release any other collateral as security for any of the Collateral
or the Note; 0) add or release any guarantor, indorser, surety or other party
to any of the Collateral or the Note; (k) reduce its claim to judgment or
foreclose or otherwise enforce the Security Interest, in whole or in part, by
any available judicial procedure; (1) without demand of performance or other
demand, advertisement or notice of any kind (except the notice specified below
of time and place of public or private sale) to or upon the Pledgor or any
other person (all of which are, to the extent permitted by law, hereby
expressly waived), forthwith realize upon the Collateral or any part thereof,
and may forthwith sell or otherwise dispose of or deliver the Collateral or any
part thereof or interest therein, in one or more parcels at public or private
sale or sales (it being understood and agreed that a sale of all the Collateral
at once may adversely affect the price paid for the Collateral), on any
national or regional exchange or recognized market (including without
limitation on the New York Stock Exchange or in the over-the-counter market by
a registered broker dealer at the current market price), broker's board or at
the Secured Party's office or elsewhere, at such prices and on such terms
including, but without limitation, a requirement that any purchaser of all or
any part of the Collateral purchase the shares constituting the Collateral for
investment without any intention to make any distribution thereof) as it may
deem best (it being agreed that the sale of any part of the Collateral shall
not exhaust Secured Party's power of sale, but sales may be made from time to
time until all of the Collateral has been sold or until the Note has been paid
in full without any intention to make any distribution thereof), for cash or on
credit, or for future delivery without assumption of any credit risk, with the
right of the Secured Party or any purchaser to purchase upon any such sale the
whole or any part of the Collateral free from any right or equity of redemption
in the Pledgor, which right or equity is hereby expressly waived and released,
and at any such sale it shall not be necessary to exhibit the Collateral; (m)
apply by appropriate judicial proceedings for appointment of a receiver for the
Collateral, or any part thereof, and Pledgor hereby consents to any such
appointment; (n) at its discretion, retain the Collateral in satisfaction of
the Note whenever the circumstances are such that Secured Party is entitled to
do so under the UCC or otherwise; (o) exercise any and all other rights it may
have hereunder or under the UCC or otherwise; (p) buy the Collateral at any
public sale; and (q) buy the Collateral at any private sale if the Collateral
is of a type customarily sold in a recognized market or is of a type which is
the subject of widely distributed standard price quotations. Pledgor hereby
grants to Secured Party an irrevocable proxy coupled with an interest to
exercise as to such Collateral, upon the occurrence of an Event of Default, all
rights, powers and remedies of an owner and all of the rights, powers and
remedies hereinabove set forth, the proxy herein
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granted to exist until the Note has been paid and performed in full. The
proceeds of any disposition of the Collateral or other action by the Secured
Party shall be applied as follows:
(1) First, to the cost and expenses incurred in
connection therewith or incidental thereto or to the
care or safekeeping of any of the Collateral or in
any way relating to the rights of the Secured Party
hereunder, including reasonable attorneys' fees and
legal expenses;
(2) Then, to the satisfaction of the Note in such order
as the Secured Party may elect;
(3) Then, to the payment of any other amounts required by
applicable law; and
(4) Then, to the Pledgor to the extent of any surplus
proceeds.
In addition to the rights and remedies granted to the Secured Party in
this Pledge Agreement and in any other instrument or agreement securing,
evidencing or relating to the Note, the Secured Party shall have all rights and
remedies of a secured party under the UCC. The Pledgor further agrees to waive
and agrees not to assert any rights or privileges which it may acquire under
the UCC with respect to collateral not owed by the debtor, and the Pledgor
shall be liable for the deficiency if the proceeds of any sale or other
disposition of the Collateral are insufficient to pay all amounts to which the
Secured Party is entitled and the fees and expenses of any attorneys employed
by the Secured Party to collect such deficiency. The Secured Party will be
under no duty to exercise or to withhold the exercise of any of the rights,
powers, privileges and options expressly or implicitly granted to the Secured
Party in this Pledge Agreement and shall not be responsible for any failure to
do so or delay in so doing.
10. Laws and Agreements. Pledgor agrees that there may be legal
and/or practical restrictions or limitations affecting Secured Party in
attempting to dispose of certain portions of the Collateral and enforce its
rights hereunder, because of the Securities Act of 1933, as amended, or any
other laws or regulations, or for other reasons, including an order to obtain
any required approval of the purchase or purchaser by any governmental
regulatory agency or officers. For these reasons, Secured Party is hereby
authorized by Pledgor, but not obligated, in the event of the occurrence of an
Event of Default, to sell all or any part of the Collateral at private sale,
subject to investment letter or in any other manner which will not require the
Collateral, or any part thereof, to be registered in accordance with any laws
or regulations, including but not limited to the Securities Act of 1933, as
amended, or the rules and regulations promulgated thereunder, or make it
necessary to
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obtain any required approval of purchaser or the purchase by any governmental
regulatory agency or officer, at the best price reasonably obtainable by
Secured Party at such private sale or other disposition in the manner mentioned
above. Secured Party is also hereby authorized by Pledgor, but not obligated,
to take such actions, give such notices, obtain such consents and do such other
things as Secured Party may deem necessary or appropriate in the event of sale
or disposition of any of the Collateral. Pledgor understands that Secured
Party may in its discretion approach a restricted number of potential
purchasers and that a sale under such circumstances may yield a lower price for
the Collateral, or any part or parts thereof, than would otherwise be
obtainable if same were either offered to a large number of potential
purchasers, or registered and sold in the open market. The Pledgor agrees (i)
that at such private sale or sales, the Secured Party shall have the right to
rely upon the advice and opinion of any member firm of a national securities
exchange as to the best price reasonably obtainable upon such private sale
thereof, and that such reliance shall be conclusive evidence that the Secured
Party handled such matter in a commercially reasonable manner under applicable
law, and (ii) that the Secured Party has no obligation to delay sale of any
Collateral to permit the issuer thereof to register it for public sale under
any applicable federal or state securities laws, and (iii) that the Secured
Party shall not be liable or accountable to Pledgor, nor shall the Note be
subject to any reduction by reason of the fact that the proceeds of sale
subject to any such limitation or restriction are less than otherwise might
have been obtained.
11. Notification of Sale. Reasonable notification of the time and
place of any public sale of the Collateral, or reasonable notification of the
time after which any private sale or other intended disposition of the
Collateral is to be made, shall be sent to Pledgor and to any other person
entitled under the UCC to notice; provided that if any of the Collateral
threatens to decline speedily in value or is of the type customarily sold on a
recognized market, Secured Party may sell or otherwise dispose of the
Collateral without notification, advertisement, or other notice of any kind. It
is agreed that notice sent or given not less than five (5) calendar days prior
to the taking of the action to which the notice relates is reasonable
notification and notice for the purposes of this paragraph.
12. Satisfaction of Obligations. Upon the repayment in full of
the Note and the satisfaction of all additional costs and expenses of the
Secured Party as provided herein, this Pledge Agreement shall terminate, and
the Secured Party shall deliver to the Pledgor, at the Pledgor's expense, such
of the Collateral as shall not have been sold or otherwise applied pursuant to
this Pledge Agreement.
13. Duties of Secured Party. The Secured Party's duty with
respect to any Collateral now or hereafter in the possession of the
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Secured Party is solely to use reasonable care in the custody and preservation
of the Collateral. The Secured Party shall be deemed to have exercised
reasonable care in the custody and preservation in the Collateral if the
Collateral is accorded treatment substantially equal to that which the Secured
Party accords its own property, it being understood that the Secured Party
shall not have any responsibility for ascertaining or taking action with
respect to fixing or preserving rights against prior parties to the Collateral,
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Collateral or for informing Pledgor of such matters whether or not the
Secured Party has or is deemed to have any knowledge of such matters. The
Secured Party shall not be required to take any steps necessary to preserve any
rights in the Collateral against prior parties or to protect, perfect, preserve
or maintain any security interest given to secure the Collateral. Secured
Party shall never be liable for its failure to use due diligence in the
collection of the Note, or any part thereof, or for its failure to give notice
to the Pledgor of default in the payment of the Note, or any part thereof, or
in the payment of or upon any security, whether pledged hereunder or otherwise.
The Secured Party shall not be liable for a decline in the market value of the
Collateral.
14. Indemnification. The Pledgor hereby agrees to indemnity and
to hold Secured Party harmless from and against any loss, claim, demand or
expense (including attorneys' fees) by reason, or in any manner related to, the
Collateral, including any such claim as may arise by reason of any alleged
breach of warranty concerning the Collateral, by reason of the failure of the
Pledgor to comply with any state or federal statute, rule, regulation, order or
decree, or by reason of the Secured Party's efforts to enforce payment of the
Note, including expenses incurred in satisfying any applicable securities and
banking laws.
15. Expenses. The Pledgor will upon demand pay to the Secured
Party the amount of any and all reasonable expenses, including the reasonable
fees and expenses of its counsel and of any experts and agents, which the
Secured Party may incur in connection with (i) the administration of this
Pledge Agreement, (ii) the custody or preservation 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 by the Pledgor to perform or observe any of the provisions
hereof
16. Security Interest Absolute. All rights of the Secured Party
and the pledge and Security Interest hereunder, and all obligations of the
Pledgor hereunder, shall be absolute and unconditional in all respects and
shall not be released, diminished, impaired, or affected for any reason,
including without limitation the occurrence of any one or more of the following
events:
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(a) The taking or accepting of any other security or assurance for
the Note;
(b) Any change in the time, manner or place of payment of, or in
any other term of the Note;
(c) Any exchange, release, subordination, surrender, loss or
non-perfection of any other collateral at any time existing in
connection with the Note, or any release or amendment or
waiver of or consent to departure from any guaranty, or other
security for the Note;
(d) Any neglect, delay, omission, failure, or refusal of the
Secured Party to take or prosecute any action in connection
with this Pledge Agreement or the Note;
(e) The insolvency, bankruptcy, or lack of corporate power of the
Pledgor; or
(f) Any other circumstance which might otherwise constitute a
defense available to a discharge of the Pledgor in respect of
the obligations of the Pledgor in respect of this Pledge
Agreement.
17. Waivers. Except as otherwise required by the terms hereof or
by applicable law, the Pledgor hereby waives all notices, including but not
limited to demand, presentment for payment, notice of nonpayment, protest,
notice of protest, notice of intent to accelerate, notice of acceleration and
all other notices, and without further notice hereby consents to any and all
renewals, extensions, amendments, modifications, indulgences, releases,
subordinations, waivers or changes in the terms of the Note or this Pledge
Agreement.
18. Benefit. This Pledge Agreement shall be binding upon and
inure to the benefit of Pledgor and Secured Party, and their respective heirs,
legal representatives, successors and assigns; provided, that Pledgor may not,
without the prior written consent of Secured Party, assign any rights, powers,
duties or obligations hereunder.
19. Remedies Cumulative. The rights and remedies provided herein
and in the Note are cumulative and are in addition to and not exclusive of any
rights or remedies provided by law, including, but without limitation, the
rights and remedies of a secured party under the UCC.
20. Amendment. This agreement may be amended only by written
instrument signed by both parties.
21. Course of Dealings. No course of dealing between the Pledgor
and the Secured Party, nor any failure to exercise, nor any
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delay in exercising any right, power or privilege of, the Secured Party
hereunder or under the Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or
thereunder preclude any other or further exercise thereof or the exercise of
any other right, power or privilege.
22. Invalidity of Any Provision. The invalidity of any one or
more phrases, sentences, clauses, paragraphs or sections hereof shall not
affect the remaining portions of this Pledge Agreement, all of which are being
inserted conditionally on their being held legally valid. In the event that
any one or more of the phrases, sentences, clauses, paragraphs or sections
contained herein should be invalid, or should operate to render this Pledge
Agreement invalid, then this Pledge Agreement shall be construed as if such
invalid phrase or phrases, sentence or sentences, clause or clauses, paragraph
or paragraphs, or section or sections had not been inserted.
23. Application of Payments. If at any time Pledgor's liabilities
to the Secured Party are in the excess of the Pledgor's indebtedness to Secured
Party under the Note, the Secured Party may, at its option, first apply all
payments made to Pledgor or collected with respect to the Collateral, toward
payment of Pledgor's liabilities in excess of that evidenced by the Note.
24. Stock Powers. Secured Party shall hold the Collateral in the
form in which it is delivered to it unless and until it is entitled under the
terms hereof to register, to sell or to dispose of the same as hereinabove
provided, in which event Pledgor hereby authorizes and irrevocably appoints the
Secured Party as the Pledgor's Attorney-in-Fact to transfer such Collateral on
the books of the issuer thereof, in whole or in part, to the name of the
Secured Party or such other person or persons as the Secured Party may
designate. The powers of attorney granted by, attached to, or pursuant to this
Pledge Agreement and all authority hereby conferred, are made, granted and
conferred subject to and in consideration of the interest of the Secured Party
for the purpose of assuring payment of the Note. Accordingly, such powers of
attorney shall be deemed coupled with an interest and irrevocable prior to the
payment in full of the Note and shall not be terminated prior thereto or
affected by any act of Pledgor, or any other person or by operation of law,
including but not limited to, the dissolution, death, disability or
incompetency of any person, determination of any trust, or the occurrence of
any other event. If the Pledgor, the issuer of the Collateral or any other
person should be dissolved or die or become disabled or incompetent, or an
other event should occur before the payment in full of the Note such
Attorney-in-Fact is nevertheless authorized to act under such powers of
attorney as if such dissolution, death, disability or incompetency or other
event had not occurred and regardless of notice thereof.
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25. GOVERNING LAW. THIS PLEDGE AGREEMENT IS BEING EXECUTED AND
DELIVERED, AND IS INTENDED TO BE PERFORMED, IN THE STATE OF TEXAS, AND THE
SUBSTANTIVE LAWS OF SUCH STATE SHALL GOVERN THE VALIDITY, CONSTRUCTION,
ENFORCEMENT AND INTERPRETATION OF THIS AGREEMENT, UNLESS THE LAWS OF ANOTHER
STATE REQUIRE THE APPLICATION OF THE LAWS OF SUCH STATE. THIS PLEDGE AGREEMENT
IS PERFORMABLE IN DALLAS, TEXAS.
26. Severability of Security. Pledgor hereby agrees that this
Agreement may, upon request by the Secured Party, be substituted by five (5)
new Pledge Agreements each securing one-fifth (1/5) of the Collateral secured
hereby. Upon substitution of this Agreement with five (5) new Pledge
Agreements, this Agreement will be marked to read "Substituted with Five (5)
Pledge Agreements" and returned to Pledgor. At such time, Pledgor shall cause
Medical Resource to issue five new stock certificates in equal amounts of
shares to replace the Collateral.
27. Notice. Any notice, request, demand, instruction or other
communication to be given to either party hereunder, except those required to
be delivered at Closing, shall be in writing, and shall be deemed to be given
upon receipt, if hand delivered or delivered by express delivery service, or
three (3) days after deposit of such notice in registered or certified mail,
return receipt requested (provided that any notice of termination shall be
effective immediately upon deposit in registered or certified mail, return
receipt requested), addressed as follows:
IF TO PLEDGOR:
JRG Investment Co., Inc.
Attn.: Xx. Xxxxx X. Xxxxxx
0000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
IF TO SECURED PARTY:
M.S. HOLDING CO. CORP.
Attn.: Mr. P. Xxxxx Xxxxxxx
00000 X. Xxxxxxx Xxxxxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
COPY TO:
Xxxx X. Xxxxxxx, Esq.
00000 X. Xxxxxxx Xxxxxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
The addresses and addressees for the purpose of this article may be
changed by either party by giving notice of such change to the other party in
the manner provided herein for giving notice.
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For the purpose of changing such addresses or addressees only, unless and until
such written notice is received, the last address and addressee stated herein
shall be deemed to continue in effect for all purposes.
28. Supplement. Pledgor agrees to supplement this agreement with
all reasonable documentation necessary to accomplish the intention of this
agreement.
IN WITNESS WHEREOF, the parties have executed this Pledge Agreement as
of the day and year first above written.
PLEDGOR:
JRG INVESTMENT CO., INC.,
a Nevada corporation
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Xxxxx X. Xxxxxx,
President
SECURED PARTY:
M.S. HOLDING CO. CORP., a
Nevada corporation
By: /s/ F. Xxxxx Xxxxxxx
-------------------------------
F. Xxxxx Xxxxxxx,
Vice President
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