EXHIBIT 10.22
SHARE PLEDGE AND SECURITY AGREEMENT
THIS SHARE PLEDGE AND SECURITY AGREEMENT (the "Agreement"), dated as of
November 4, 1996 is made by and between StreamLogic Software Corporation, a
Delaware corporation ("Pledgor") and FWB Software, LLC, a California limited
liability company ("Secured Party").
R E C I T A L S
A. Pledgor is the owner of 750,000 membership shares (the "Pledged
Shares") of FWB Software, LLC (the "Shares"), as evidenced by certificate
numbers ____________.
B. As security for the "Obligations" described in Section 2 below, Pledgor
has agreed to make the pledge contemplated by this Agreement.
IT IS AGREED:
1. Pledge. Pledgor hereby pledges and delivers to Secured Party, and
grants to Secured Party a security interest in, all of the following (the
"Pledged Collateral"):
(a) The Pledged Shares and the certificate representing the Pledged 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 Pledged Shares; and
(b) All additional Shares or other securities of Secured Party from time to
time acquired by Pledgor in connection with any Share split, Share dividend or
other distribution or exchange in respect of any Shares pledged hereunder, and
the certificates representing such additional shares or other securities, and
all dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such shares.
The inclusion of proceeds in this Agreement does not authorize Pledgor to sell,
dispose of or otherwise use the Pledged Collateral in any manner not
specifically authorized hereby.
2. Security for Obligations. This Agreement secures the payment and
performance of (i) all indebtedness evidenced by, and all liabilities and
obligations of Pledgor to Secured Party under, that certain Promissory Note
executed by Pledgor dated November 4, 1996 in favor of Secured Party (the
"Note"), and all modifications, renewals, extensions and rearrangements thereof
and substitutions and replacements therefor, and (ii) all indebtedness,
liabilities and obligations of Pledgor now or hereafter existing under this
Agreement (all of the foregoing collectively the "Obligations").
3. Delivery of Pledged Collateral. All certificates representing the
Pledged Collateral, accompanied by instruments of transfer or assignment duly
executed in blank by Pledgor, have been delivered to and held by or on behalf of
Secured Party pursuant hereto, all in
form and substance satisfactory to Secured Party. Upon the occurrence and during
the continuation of an event which, with the giving of notice or the lapse of
time, or both, would become an Event of Default (as defined in Section 7
hereof). Secured Party shall have the right, in its discretion and without
notice to Pledgor, to transfer to or to register in its name or the name of a
nominee any or all of the Pledged Collateral, subject only to the revocable
rights specified in Section 5(a) hereof. In addition, Secured Party shall have
the right at any time to exchange certificates representing the Pledged
Collateral in its possession for certificates of smaller or larger
denominations.
4. Representations and Warranties. Pledgor represents and warrants as
follows:
(a) Pledgor is a corporation organized and in good standing under the laws
of the State of Delaware and has full power and authority to enter into and
perform all of its obligations under this Agreement.
(b) The execution, delivery and performance by Pledgor of this Agreement do
not violate any provision of any statute, law, rule, regulation, judgment, order
or decree binding upon Pledgor and will not conflict with, or constitute a
breach or default under, any indenture, loan agreement, contract or other
agreement or instrument to which Pledgor is a party or by which Pledgor or any
of its property is bound.
(c) No authorization, consent or approval or other action by, and no notice
to or other filing with, any governmental authority or regulatory body is
required either (i) for the execution and delivery by Pledgor of this Agreement,
the pledge by Pledgor of the Pledged Collateral pursuant hereto or the
performance by Pledgor of any of its obligations hereunder, or (ii) for the
exercise by Secured Party of the voting or other rights provided for in this
Agreement or the remedies in respect of the Pledged Collateral pursuant hereto
(except as may be required in connection with such disposition by laws affecting
the offering and sale of securities generally).
(d) Pledgor is, and in the case of any Pledged Collateral other than the
Pledged Shares will be, the legal and beneficial owner of the Pledged Collateral
free and clear of any lien, security interest, option, charge or encumbrance,
except for the security interest created by this Agreement.
(e) The pledge of the Pledged Shares creates a valid and perfected first
priority security interest in the Pledged Collateral, securing payment of the
Obligations.
5. Voting Rights; Dividends, Etc.
(a) So long as no Event of Default or event which, with the giving of
notice or the lapse of time, or both, would become an Event of Default shall
have occurred:
(i) Pledgor shall be entitled to exercise any and all voting and other
consensual rights pertaining to the Pledged Collateral or any part thereof for
any purpose
not inconsistent with the terms of this Agreement or any document, agreement or
instrument entered into in connection with the Note.
(ii) Pledgor shall be entitled to receive and retain any and all cash
dividends paid in respect of the Pledged Collateral; provided, however, that all
other dividends and Shares, property or otherwise, including dividends
representing Shares or liquidating dividends, or a distribution or return of
capital upon or in respect of the Pledged Collateral, or any part thereof, or
resulting from a split-up, revision or reclassification of the Pledged Shares or
any part thereof, or received in exchange for the Pledged Shares or any part
thereof as a result of a merger, consolidation or otherwise, shall be paid,
delivered and transferred directly to Secured Party immediately upon receipt
thereof by Pledgor, or, if received by Secured Party, shall be retained by
Secured Party as part of the Pledged Shares.
(b) Upon the occurrence and during the continuation of an event which,
with the giving of notice or the lapse of time, or both, would become an Event
of Default:
(i) All rights of Pledgor to exercise the voting and other
consensual rights which it would otherwise be entitled to exercise pursuant to
Section 5(a)(i) shall cease, and all such rights shall thereupon become vested
in Secured Party, who shall thereupon have the sole right to exercise such
voting and other consensual rights.
(ii) Secured Party shall be entitled to receive and retain any and
all cash dividends paid in respect of the Pledged Collateral.
(iii) All dividends and other distributions which are received by
Pledgor contrary to the provisions of this Agreement shall be received in trust
for the benefit of Secured Party, shall be segregated from other funds of
Pledgor and shall be forthwith paid over to Secured Party as payment in respect
of the Obligations (with any necessary endorsements).
6. Transfers and Other Liens; Additional Shares.
(a) Pledgor agrees that it will not (i) sell or otherwise dispose of, or
grant any option with respect to, any of the Pledged Collateral, or (ii) create
or permit to exist any lien, security interest or other charge or encumbrance
upon or with respect to any of the Pledged Collateral, except for the security
interest created by this Agreement or except as set forth below.
(b) Pledgor agrees that it will pledge hereunder, immediately upon its
acquisition (directly or indirectly) thereof, any and all additional Shares or
other securities it may acquire in connection with any Share split, Share
dividend or other distribution or exchange in respect of any Shares or other
securities pledged hereunder.
7. Events of Default. Pledgor shall be in default under this Agreement
upon the happening of any of the following events (each an "Event of Default"):
(a) Pledgor fails to pay or perform when due any of the Obligations;
(b) Any representation or warranty made by Pledgor in connection with this
Agreement proves to be false in any material respect when made;
(c) Pledgor makes an assignment for the benefit of creditors, admits in
writing its inability to pay its debts as they mature, applies to any court for
the appointment of a trustee or receiver of any substantial part of its
properties, or commences any voluntary proceedings under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution,
liquidation or other similar law of any jurisdiction; or
(d) Any such application or any such proceedings described in (c) above
are filed or commenced against Pledgor and Pledgor indicates its approval,
consent of acquiescence thereto, or an order is entered adjudicating Pledgor or
any such endorser, guarantor or surety bankrupt or insolvent and such order
remains in effect for thirty (30) days.
8. Rights and Remedies Upon Default. If any Event of Default shall have
occurred:
(a) Secured Party shall have, in addition to other rights and remedies
provided for herein or otherwise available to it, all the rights and remedies of
a secured party on default under the Uniform Commercial Code (the "Code") in
effect in the State of California at that time, and Secured Party may also,
without notice except as specified below, sell the Pledged Collateral or any
part thereof in one or more private sales, at any of Secured Party's offices or
elsewhere, for cash, on credit or for future delivery, and upon such other terms
as Secured Party may deem commercially reasonable. Secured Party is authorized
at any such sale, if Secured Party deems it advisable, to restrict the
prospective bidders or purchasers to persons who will represent and agree that
they are purchasing for their own account and not with a view to the
distribution or sale of any such Pledged Collateral. Each purchaser at any such
sale shall hold the Pledged Collateral acquired at such sale absolutely free
from any claim or right of any kind, including any equity or right of redemption
of Pledgor, and Pledgor hereby expressly waives all rights of redemption, stay
or appraisement which it has or may have under any rule, law or statute now or
hereafter existing. Pledgor agrees that, to the extent notice of sale shall be
required by law, at least five (5) days' notice to Pledgor of the time after
which any private sale is to be made shall constitute reasonable notification.
Secured Party shall not be obligated to make any sale of Pledged Collateral
regardless of notice of sale having been given. Secured Party may adjourn any
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, by made at the time and
place to which it was so adjourned. Secured Party may, instead of exercising the
powers of sale provided for herein and under the Code, proceed by a suit or
suits, at law or in equity, to foreclose the pledge of this Agreement and sell
the Pledged Collateral, or any portion thereof, under a judgment or decree of
any court or courts of competent jurisdiction.
(b) Any cash held by Secured Party as Pledged Collateral and all cash
proceeds received by Secured Party in respect of any sale of, collection from or
other realization upon all or any part of the Pledged Collateral may, in the
discretion of Secured Party, be held by
Secured Party as collateral for, and/or then or at any time thereafter applied
in whole or in part by Secured Party against, the Obligations in such order as
Secured Party shall elect. Any surplus of such cash or cash proceeds held by
Secured Party and remaining after payment in full of the Obligations shall be
paid over to Pledgor or to whomsoever may be lawfully entitled to receive such
surplus.
(c) All rights and remedies of Secured Party expressed herein are in
addition to all other rights and remedies possessed by Secured Party in any
other agreement or instrument entered into in connection with or relating to the
Obligation or by law.
(d) 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 and, notwithstanding such circumstances, agrees that any such
private sale shall, to the extent permitted by law, be deemed to have been made
in a commercially reasonable manner.
(e) Pledgor further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to Secured Party, and
that Secured Party has no adequate remedy at law in respect of any such breach
and, as a consequence, Pledgor agrees that each and every covenant contained in
this Section shall be specifically enforceable against Pledgor, and Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that no Event of
Default has occurred.
9. Continuing Pledge. This Agreement shall create a continuing security
interest in the Pledged Collateral and shall (i) remain in full force and effect
until payment in full of the Obligations, (ii) be binding upon Pledgor and its
successors and assigns, and (iii) inure to the benefit of Secured Party and
its successors, transferees and assigns. Without limiting the generality of the
foregoing clause (iii), Secured Party may assign or otherwise transfer any of
its rights under this Agreement to any other person, and such person shall
thereupon become vested with all the benefits in respect thereof granted to
Secured Party herein or otherwise, provided that such members shall continue to
remain liable for and shall not be released from any obligations of such members
under this Agreement. Upon payment in full of the Obligations, Pledgor shall be
entitled to the return, at Pledgor's expense, of such of the Pledged Collateral
as shall not have been sold or otherwise applied pursuant to the terms hereof.
10. Further Assurances. Pledgor agrees that it will, at its own
expense, promptly execute, acknowledge and deliver all such documents and
instruments, and take all such actions, as the Secured Party may from time to
time request in order to perfect and protect any security interest granted or
purported to be granted hereby or to enable Secured Party to exercise and
enforce its rights and remedies hereunder and otherwise to effectuate the
purposes of this Agreement and carry out the terms hereof.
11. Waivers; Remedies Cumulative. No failure on the part of Secured
Party to exercise, and no delay in exercising, any right or remedy hereunder
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right or remedy hereunder by Secured
Party preclude any other or further exercise thereof or the exercise of any
other right or remedy. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
12. Notices. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be delivered by hand or mailed by
first class mail, registered or certified, return receipt requested, postage
prepaid, and properly addressed, to the party at the addresses set forth below.
(a) If to Pledgor:
(b) If to Secured Party at:
FWB Software, Inc.
000 Xxxxxxxxxxxx Xxxxxx
Xxxxx X
Xxxxx Xxxx, XX
Attention: Xxxxxx Xxxx
All such notices, requests, demands and other communications shall be effective
only upon receipt. Any party may change its address for notice given in
accordance with this Section 12.
13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California applicable to contracts made
and to be performed in the State of California, except to the extent that the
validity or perfection of the security interest hereunder, or remedies
hereunder, in respect of any particular Pledged Collateral are governed by the
laws of a jurisdiction other than the State of California. Whenever possible,
each provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this Agreement
shall be prohibited or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement. This Agreement shall be given a fair and reasonable construction in
accordance with the intention of the parties and without regard to, or aid of,
Section 1654 of the California Civil Code.
14. Miscellaneous. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated, except by an instrument in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought. The captions in this Agreement have been inserted for
convenience only and shall not control or affect the meaning or construction of
any of the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Share Pledge and
Security Agreement as of the date first above written.
PLEDGOR: SECURED PARTY
StreamLogic Software Corporation FWB Software, LLC
By: /s/ J. Xxxxx Xxxxx By: /s/ Xxxxxx Xxxx
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J. Xxxxx Xxxxx Xxxxxx Xxxx, President
Title:
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