SECURITIES PLEDGE AGREEMENT
This
SECURITIES
PLEDGE AGREEMENT
(this
“Agreement”)
is
made as of November 30, 2007, by and among the Pledgors identified as such
on
the signature pages hereof (each individually, a “Pledgor”
and,
collectively, the “Pledgors”),
in
favor of WOODSIDE AGENCY SERVICES, LLC, as collateral agent (hereinafter, in
such capacity, the "Collateral Agent")
for
itself and the Holders (as defined in the Purchase Agreement referred to below)
under that certain Securities Purchase and Loan Agreement, dated as of the
date
hereof (as amended, modified, supplemented or restated and in effect from time
to time, the "Purchase
Agreement"),
among
NATIONAL INVESTMENT MANAGERS INC., a Florida corporation (the “Company”),
the
Holders and the Collateral Agent.
WHEREAS,
each
Pledgor is the direct
legal and beneficial owner of certain of
the
issued and outstanding capital stock, units of outstanding membership interests
or other equity interests, as the case may be, of each of the entities set
forth
opposite the respective Pledgor on Annex A
hereto
(the "Subsidiaries")
in the
percentages set forth on such Annex A;
and
WHEREAS,
it is a
condition precedent to the Holders extending credit accommodations to the
Company under the Purchase Agreement that each Pledgor execute and deliver
to
the Collateral Agent, for the benefit of the Holders and the Collateral Agent,
a
pledge agreement in substantially the form hereof; and
WHEREAS,
each
Pledgor wishes to grant pledges and security interests in favor of the
Collateral Agent, for the benefit of the Holders and the Collateral Agent,
as
herein provided;
NOW,
THEREFORE,
in
consideration of the premises contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
parties hereto agree as follows:
1.
Pledge
of Securities, etc.
1.1. Pledge
of Securities.
Each
Pledgor hereby pledges, assigns and grants a security interest in, mortgages,
collaterally assigns and delivers to the Collateral Agent, for the benefit
of
the Holders and the Collateral Agent, all the right, title and interest of
such
Pledgor in and to all of the shares of capital stock, partnership interests,
limited liability company membership units or other units of equity ownership
of
every class of each of its Subsidiaries, wherever located and whether now owned
or hereafter acquired or arising, as more fully described on Annex A
hereto,
including without limitation, with respect to any Subsidiary which is a limited
liability company or a partnership, (a) all payments or distributions, whether
in cash, property or otherwise, at any time owing or payable to such Pledgor
on
account of its interest as a member or as a partner, as the case may be, in
any
of its Subsidiaries or in the nature of a management, investment banking or
other fee paid or payable by any of the Subsidiaries to such Pledgor, (b) all
of
such Pledgor’s rights and interests under each of the partnership agreements or
operating agreements, as applicable, including all voting and management rights
and all rights to grant or withhold consents or approvals, (c) all other rights,
interests, property or claims to which such Pledgor may be entitled in its
capacity as the sole member of any Subsidiary of such Pledgor, and (d) all
proceeds, income from, increases in and products of any of the foregoing to
be
held by the Collateral Agent, for the benefit of the Holders and the Collateral
Agent, subject to the terms and conditions hereinafter set forth. The
certificates for such shares, membership units, partnership interests or other
units of equity ownership of every class of the capital stock or other equity
interest of its Subsidiaries, to the extent that such interests are represented
by certificates, accompanied by stock powers or other appropriate instruments
of
assignment thereof duly executed in blank by each Pledgor, have been delivered
to the Collateral Agent. Each Pledgor further represents and warrants that
none
of the limited liability company membership units or the partnership interests
of any Pledgor issued by any Subsidiary is a security governed by Article 8
of
the Uniform Commercial Code of the jurisdiction in which such Subsidiary is
organized.
1.2. Additional
Securities.
In case
any Pledgor shall acquire any additional capital stock or other equity interest
of any Subsidiary of such Pledgor or any newly-created or acquired Subsidiary
or
corporation, partnership, limited liability company or other entity which is
the
successor of any Subsidiary of such Pledgor, or any securities exchangeable
for
or convertible into shares of such capital stock or other equity interest of
any
class of any Subsidiary of such Pledgor, by purchase, stock dividend, stock
split or otherwise, then such Pledgor shall forthwith deliver to and pledge
such
capital stock or other equity interests shall be subject to the pledge,
assignment and security interest granted to the Collateral Agent, for the
benefit of the Holders and the Collateral Agent, under this Agreement and shall
deliver to the Collateral Agent forthwith any certificates therefor, accompanied
by stock powers or other appropriate instruments of assignment duly executed
by
such Pledgor in blank. Each Pledgor agrees that the Collateral Agent may from
time to time attach as Annex A
hereto
an updated list of the shares of capital stock or other equity interests at
the
time pledged with the Collateral Agent hereunder.
1.3. Pledge
of Cash Collateral Account.
Each
Pledgor also hereby pledges, assigns, grants a security interest in, and
delivers to the Collateral Agent, for the benefit of the Holders and the
Collateral Agent, the Cash Collateral Account and all of the Cash Collateral
as
such terms are hereinafter defined.
1.4. Waiver
of Certain Operating Agreement Provisions.
Each
Pledgor irrevocably waives any and all provisions of the operating agreements
of
each Subsidiary of such Pledgor (as applicable) that (a) prohibit, restrict,
condition or otherwise affect the grant hereunder of any Lien on any of the
Securities Collateral or any enforcement action which may be taken in respect
of
any such Lien or (b) otherwise conflict with the terms of this
Agreement.
2. Definitions.
The term
"Obligations" and all other capitalized terms used herein without definition
shall have the respective meanings provided therefor in the Purchase Agreement.
Terms used herein and not defined in the Purchase Agreement or otherwise defined
herein that are defined in the Uniform Commercial Code as in effect in the
State
of Massachusetts (the "UCC") have such defined meanings herein (with terms
used
in Division 9 controlling over terms used in another Article), unless the
context otherwise indicates or requires, and the following terms shall have
the
following meanings:
Cash
Collateral.
See
§4.
Cash
Collateral Account.
See
§4.
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Securities.
Includes the shares of stock, membership interests, partnership interests or
other equity interests described in Annex A
attached
hereto and any additional shares of stock, membership interests, partnership
interests or other equity interests at the time pledged with the Collateral
Agent hereunder and the interests described in clauses (a)-(d) of §1.1 of this
Agreement.
Securities
Collateral.
The
property at any time pledged to the Collateral Agent hereunder (whether
described herein or not) and all income therefrom, increases therein and
proceeds thereof, including without limitation that included in Cash Collateral.
The term does not include any income, increases or proceeds received by any
Pledgor to the extent expressly permitted by §6.
Time
Deposits.
See
§4.
3. Security
for Obligations.
This
Agreement and the security interest in and pledge of the Securities Collateral
hereunder are made with and granted to the Collateral Agent, for the benefit
of
the Holders and the Collateral Agent, as security for the payment and
performance in full of all the Obligations (including all such Obligations
which
would become due but for the operation of the automatic stay pursuant to §362(a)
of the Bankruptcy Code of the United States and the operation of §§502(b) and
506(b) of the Bankruptcy Code of the United States).
4. Liquidation,
Recapitalization, etc.
4.1. Distributions
Paid to Collateral Agent.
Any sums
or other property paid or distributed upon or with respect to any of the
Securities, whether by dividend or redemption or upon the liquidation or
dissolution of the issuer thereof or otherwise, shall, except to the limited
extent provided in §6, be paid over and delivered to the Collateral Agent to be
held by the Collateral Agent, for the benefit of the Holders and the Collateral
Agent, as security for the payment and performance in full of all of the
Obligations. In case, pursuant to the recapitalization or reclassification
of
the capital of the issuer thereof or pursuant to the reorganization thereof,
any
distribution of capital shall be made on or in respect of any of the Securities
or any property shall be distributed upon or with respect to any of the
Securities, the property so distributed shall be delivered to the Collateral
Agent, for the benefit of the Holders and the Collateral Agent, to be held
by it
as security for the Obligations. Except to the limited extent provided in §6,
all sums of money and property paid or distributed in respect of the Securities,
whether as a dividend or upon such a liquidation, dissolution, recapitalization
or reclassification or otherwise, that are received by any Pledgor shall, until
paid or delivered to the Collateral Agent, be held in trust for the Collateral
Agent, for the benefit of the Holders and the Collateral Agent, as security
for
the payment and performance in full of all of the Obligations.
4.2. Cash
Collateral Account.
All sums
of money that are delivered to the Collateral Agent pursuant to this §4 shall be
deposited into an interest bearing account with the Collateral Agent or, if
the
Collateral Agent is not the depositary bank, to an interest bearing account
in
the name of the Collateral Agent, for the benefit of the Holders and the
Collateral Agent, as customer with a depositary bank satisfactory to the
Collateral Agent (any such account, whether maintained with the Collateral
Agent
or in the Collateral Agent's name as customer being herein referred to as the
"Cash
Collateral Account").
Some
or all of the funds from time to time in the Cash Collateral Account may be
invested in time deposits, including, without limitation, certificates of
deposit issued by the Collateral Agent (such certificates of deposit or other
time deposits being hereinafter referred to, collectively, as "Time
Deposits"),
that
are satisfactory to the Collateral Agent after consultation with the applicable
Pledgor, provided,
that,
in each such case, arrangements satisfactory to the Collateral Agent are made
and are in place to perfect and to insure the first priority of the Collateral
Agent’s security interest therein. Interest earned on the Cash Collateral
Account and on the Time Deposits, and the principal of the Time Deposits at
maturity that is not invested in new Time Deposits, shall be deposited in the
Cash Collateral Account. The Cash Collateral Account, all sums from time to
time
standing to the credit of the Cash Collateral Account, any and all Time
Deposits, any and all instruments or other writings evidencing Time Deposits
and
any and all proceeds or any thereof are hereinafter referred to as the
"Cash
Collateral".
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4.3. Pledgors’
Rights to Cash Collateral, etc.
Except
as otherwise expressly provided in §16, no Pledgor shall have the right to
withdraw sums from the Cash Collateral Account, to receive any of the Cash
Collateral or to require the Collateral Agent to part with the Collateral
Agent’s possession of any instruments or other writings evidencing any Time
Deposits.
5. Warranty
of Title; Authority.
Each
Pledgor hereby represents and warrants that: (a) such Pledgor has good and
marketable title to, and is the sole record and beneficial owner of, the
Securities described in §1, subject to no pledges, liens, security interests,
charges, options, restrictions (other than restrictions contained in the
operating agreements of the pledged entities, which restrictions do not limit
the pledge and security interest created by this Agreement) or other
encumbrances except the pledge and security interest created by this Agreement
or as otherwise permitted under the Purchase Agreement, (b) such Pledgor has
tendered to the Collateral Agent the consent of any other partner of any
Subsidiary which is a partnership or member or manager of any Subsidiary which
is a limited liability company deemed necessary or appropriate by such Pledgor
for consummation of the transactions contemplated hereby, (c) all of the
Securities described in §1 are validly issued, fully paid and non-assessable (or
the foreign equivalent thereof, as applicable), (d) such Pledgor has full power,
authority and legal right to execute, deliver and perform its obligations under
this Agreement and to pledge and grant a security interest in all of the
Securities Collateral pursuant to this Agreement, and the execution, delivery
and performance hereof and the pledge of and granting and enforcement (where
applicable) of a security interest in the Securities Collateral hereunder have
been duly authorized by all necessary corporate or other action and do not
contravene any law, rule or regulation or any provision of such Pledgor’s
charter documents, operating agreement, partnership agreement, by-laws or other
governing document or of any judgment, decree or order of any tribunal or of
any
agreement or instrument to which such Pledgor is a party or by which it or
any
of its property is bound or affected or constitute a default thereunder and
(e)
the information set forth in Annex A
hereto
relating to the Securities is true, correct and complete as of the date hereof
in all material respects. Each Pledgor covenants that it will defend the rights
of the Holders and the Collateral Agent and security interest of the Collateral
Agent, for the benefit of the Holders and the Collateral Agent, in such
Securities against the claims and demands of all other persons whomsoever.
Each
Pledgor further covenants that it will have the like title to and right to
pledge and grant a security interest in the Securities Collateral hereafter
pledged or in which a security interest is granted to the Collateral Agent
hereunder and will likewise defend the rights, pledge and security interest
thereof and therein of the Holders and the Collateral Agent.
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6. Dividends,
Voting, etc., Prior to Maturity.
So long
as no Event of Default shall have occurred and be continuing, each Pledgor
shall
be entitled to receive all cash dividends or distributions paid in respect
of
the Securities (subject to the terms and conditions of the Purchase Agreement),
to vote the Securities (subject to the last sentence of this paragraph) and
to
give consents, waivers and ratifications in respect of the Securities;
provided,
however,
that no
vote shall be cast or consent, waiver or ratification given by such Pledgor
if
the effect thereof could reasonably be expected to impair any of the Securities
Collateral or be inconsistent with or result in any violation of any of the
provisions of the Purchase Agreement or any of the other Financing Agreements.
All such rights of such Pledgor to receive cash dividends or distributions
shall
cease in case a Default or an Event of Default shall have occurred and be
continuing. All such rights of any Pledgor to vote and give consents, waivers
and ratifications with respect to the Securities shall, at the Collateral
Agent’s option, as evidenced by the Collateral Agent’s notifying such Pledgor of
such election, cease in case an Event of Default shall have occurred and be
continuing.
7. Remedies.
7.1. In
General.
If an
Event
of Default shall have occurred and be continuing, the Collateral Agent shall
thereafter have the following rights and remedies (to the extent permitted
by
applicable law) in addition to the rights and remedies of a secured party under
the UCC, all such rights and remedies being cumulative, not exclusive, and
enforceable alternatively, successively or concurrently, at such time or times
as the Collateral Agent deems expedient:
(a) if
the
Collateral Agent so elects and gives notice of such election to Pledgors, the
Collateral Agent may exercise any management or voting rights relating to the
Securities (whether or not the same shall have been transferred into its name
or
the name of its nominee or nominees) for any lawful purpose, including, without
limitation, if the Collateral Agent so elects, for the liquidation of the assets
of the issuer thereof or for the amendment or modification of any of the
charter, by-laws, operating agreements, partnership agreements or other
governing documents, and give all consents, waivers and ratifications in respect
of the Securities and otherwise act with respect thereto as though it were
the
outright owner thereof (each Pledgor hereby irrevocably constituting and
appointing the Collateral Agent its proxy and attorney-in-fact, with full power
of substitution, to do so);
(b) the
Collateral Agent may demand, xxx for, collect or make any compromise or
settlement the Collateral Agent deems suitable in respect of any Securities
Collateral;
(c) the
Collateral Agent may sell, resell, assign and deliver, or otherwise dispose
of
any or all of the Securities Collateral, for cash or credit or both and upon
such terms at such place or places, at such time or times and to such entities
or other persons as the Collateral Agent thinks expedient, all without demand
for performance by any Pledgor or any notice or advertisement whatsoever except
as expressly provided herein or as may otherwise be required by
law;
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(d) the
Collateral Agent may cause all or any part of the Securities held by it to
be
transferred into its name or the name of its nominee or nominees;
and
(e) the
Collateral Agent may set off or otherwise apply or credit against the
Obligations any and all sums deposited with it or held by it, including without
limitation, any sums standing to the credit of the Cash Collateral Account
and
any Time Deposits issued by the Collateral Agent, with any withdrawal penalty
relating to Time Deposits being an expense of collection.
7.2. Sale
of Securities Collateral.
In the
event of any sale or other disposition of the Securities Collateral as provided
in clause (c) of §7.1, and to the extent that any notice thereof is required to
be given by law, the Collateral Agent shall give to Pledgors at least ten (10)
Business Days prior authenticated notice of the time and place of any public
sale or other disposition of the Securities Collateral or of the time after
which any private sale or any other intended disposition is to be made. Each
Pledgor hereby acknowledges that ten (10) Business Days prior authenticated
notice of such sale or other disposition or sales or other dispositions shall
be
reasonable notice. The Collateral Agent may enforce its rights hereunder without
any other notice and without compliance with any other condition precedent
now
or hereunder imposed by statute, rule of law or otherwise (all of which are
hereby expressly waived by Pledgors, to the fullest extent permitted by law).
The Collateral Agent may buy or otherwise acquire any part or all of the
Securities Collateral at any public sale or other disposition and if any part
or
all of the Securities Collateral is of a type customarily sold or otherwise
disposed of in a recognized market or is of the type which is the subject of
widely-distributed standard price quotations, the Collateral Agent may buy
or
otherwise acquire at private sale or other disposition and may make payments
thereof by any means. The Collateral Agent may apply the cash proceeds actually
received from any sale or other disposition to the reasonable expenses of
retaking, holding, preparing for sale, selling and the like, to reasonable
attorneys’ fees, travel and all other expenses which may be incurred by the
Collateral Agent in attempting to collect the Obligations or to enforce this
Agreement or in the prosecution or defense of any action or proceeding related
to the subject matter of this Agreement, and then to the Obligations pursuant
to
the terms of the Purchase Agreement. Only after such applications, and after
payment by the Collateral Agent of any amount required by §9-608(a)(1)(C) or
§9-615(a)(3) of the UCC, need the Collateral Agent account to Pledgors for any
surplus.
7.3. Registration
of Securities.
If the
Collateral Agent shall determine to exercise its right to sell or otherwise
dispose of any or all of the Securities pursuant to this §7, and if in the
opinion of counsel for the Collateral Agent it is necessary, or if in the
reasonable opinion of the Collateral Agent it is advisable, to have the
Securities, or that portion thereof to be sold, registered under the provisions
of the Securities Act of 1933, as amended (the "Securities
Act"),
each
Pledgor, to the extent that it has made a public offering of stock or other
securities, agrees to use commercially reasonable efforts to cause the issuer
or
issuers of the Securities contemplated to be sold, to execute and deliver,
and
cause the directors (or other analogous persons) and officers of such issuer
to
execute and deliver, all at such Pledgor’s expense, all such instruments and
documents, and to do or cause to be done all such other acts and things as
may
be necessary or, in the reasonable opinion of the Collateral Agent, advisable
to
register such Securities under the provisions of the Securities Act and to
cause
the registration statement relating thereto to become effective and to remain
effective for a period of nine (9) months from the date such registration
statement became effective, and to make all amendments thereto or to the related
prospectus or both that, in the reasonable opinion of the Collateral Agent,
are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission applicable thereto. Each Pledgor agrees to use commercially
reasonably efforts to cause such issuer or issuers to make available to its
security holders, as soon as practicable, an earnings statement which will
satisfy the provisions of Section 11(a) of the Securities Act.
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7.4. Private
Sales.
Each
Pledgor recognizes that the Collateral Agent may be unable to effect a public
sale or other disposition of the Securities by reason of certain prohibitions
contained in the Securities Act, federal banking laws, and other applicable
laws, but may be compelled to resort to one or more private sales thereof to
a
restricted group of purchasers. Each Pledgor agrees that any such private sales
may be at prices and other terms less favorable to the seller than if sold
at
public sales and that such private sales shall not by reason thereof be deemed
not to have been made in a commercially reasonable manner. The Collateral Agent
shall be under no obligation to delay a sale of any of the Securities for the
period of time necessary to permit the issuer of such securities to register
such securities for public sale under the Securities Act, or such other federal
banking or other applicable laws, even if the issuer would agree to do so.
Subject to the foregoing, the Collateral Agent agrees that any sale of the
Securities shall be made in a commercially reasonable manner, and each Pledgor
agrees to use its best efforts to cause the issuer or issuers of the Securities
contemplated to be sold, to execute and deliver, and cause the directors (or
other analogous persons) and officers of such issuer to execute and deliver,
all
at such Pledgor’s expense, all such instruments and documents, and to do or
cause to be done all such other acts and things as may be necessary or, in
the
reasonable opinion of the Collateral Agent, advisable to exempt such Securities
from registration under the provisions of the Securities Act, and to make all
amendments to such instruments and documents which, in the opinion of the
Collateral Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto. Each Pledgor further
agrees to use commercially reasonable efforts to cause such issuer or issuers
to
make available to its security holders, as soon as practicable, an earnings
statement (which need not be audited) which will satisfy the provisions of
Section 11(a) of the Securities Act.
7.5. Pledgors’
Agreements, etc.
Each
Pledgor further agrees to do or cause to be done all such other acts and things
as may be reasonably necessary on the part of such Pledgor or with respect
to
the issuer of the Securities to make any sales of any portion or all of the
Securities pursuant to this §7 valid and binding and in compliance with any and
all applicable laws (including, without limitation, the Securities Act, the
Securities Exchange Act of 1934, as amended, the rules and regulations of the
Securities and Exchange Commission applicable thereto and all applicable state
securities or "Blue Sky" laws), regulations, orders, writs, injunctions, decrees
or awards of any and all courts, arbitrators or governmental instrumentalities,
domestic or foreign, having jurisdiction over any such sale or sales, all at
such Pledgor’s expense. Each Pledgor further agrees that a breach of any of the
covenants contained in this §7 will cause irreparable injury to the Collateral
Agent and the Holders, that the Collateral Agent and the Holders have no
adequate remedy at law in respect of such breach and, as a consequence, agrees
that each and every covenant contained in this §7 shall be specifically
enforceable against such Pledgor by the Collateral Agent and such Pledgor hereby
waives and agrees not to assert any defenses against an action for specific
performance of such covenants to the extent it lawfully may.
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8. Marshalling.
Neither
the Collateral Agent nor any Holder shall be required to marshal any present
or
future collateral security for (including but not limited to this Agreement
and
the Securities Collateral), or other assurances of payment of, the Obligations
or any of them, or to resort to such collateral security or other assurances
of
payment in any particular order. All of the Collateral Agent’s rights hereunder
and of the Holders and the Collateral Agent in respect of such collateral
security and other assurances of payment shall be cumulative and in addition
to
all other rights, however existing or arising. To the extent that it lawfully
may, each Pledgor hereby agrees that it will not invoke any law relating to
the
marshalling of collateral that might cause delay in or impede the enforcement
of
the Collateral Agent’s rights under this Agreement or under any other instrument
evidencing any of the Obligations or under which any of the Obligations is
outstanding or by which any of the Obligations is secured or payment thereof
is
otherwise assured, and to the extent that it lawfully may such Pledgor hereby
irrevocably waives the benefits of all such laws.
9. Pledgors’
Obligations Not Affected.
The
obligations of each Pledgor hereunder shall remain in full force and effect
without regard to, and shall not be impaired by (a) any exercise or nonexercise,
or any waiver, by the Collateral Agent or any Holder of any right, remedy,
power
or privilege under or in respect of any of the Obligations or any security
thereof (including this Agreement); (b) any amendment to or modification of
the
Purchase Agreement, the other Financing Agreements or any of the
Obligations;
(c) any
amendment to or modification of any instrument (other than this Agreement)
securing any of the Obligations, including, without limitation, any of the
Security Documents; or (d) the taking of additional security for, or any other
assurances of payment of, any of the Obligations or the release or discharge or
termination of any security or other assurances of payment or performance for
any of the Obligations; whether or not such Pledgor shall have notice or
knowledge of any of the foregoing, such Pledgor hereby generally waiving all
suretyship defenses to the extent applicable. Under no circumstances shall
the
Collateral Agent be deemed to be a shareholder, member or other equity holder
of
any of the Subsidiaries by virtue of the provisions of this Agreement unless
expressly agreed to in writing by the Collateral Agent.
10. Transfer,
etc., by Pledgors.
Except
as expressly permitted under the Purchase Agreement, without the prior written
consent of the Collateral Agent, no Pledgor will sell, assign, transfer or
otherwise dispose of, grant any option with respect to, or pledge or grant
any
security interest in or otherwise encumber or restrict any of the Securities
Collateral or any interest therein, except for the pledge thereof and security
interest therein provided for in this Agreement.
11. Further
Assurances.
Each
Pledgor will do all such acts, and will furnish to the Collateral Agent all
such
financing statements, certificates, legal opinions and other documents and
will
obtain all such governmental consents and corporate approvals and will do or
cause to be done all such other things as the Collateral Agent may reasonably
request from time to time in order to give full effect to this Agreement and
to
secure the rights of the Holders and the Collateral Agent hereunder, all without
any cost or expense to the Collateral Agent or any Holder. Each Pledgor hereby
irrevocably authorizes the Collateral Agent at any time and from time to time
to
file in any filing office in any Uniform Commercial Code jurisdiction any
initial financing statements and amendments thereto that (a) indicate the
Collateral as the Securities Collateral or words of similar effect, or as being
of equal or lesser scope or in greater detail, and (b) contain any other
information required by part 5 of Division 9 of the Uniform Commercial Code
of
the jurisdiction of the filing office for the sufficiency or filing office
acceptance of any financing statement or amendment, including whether such
Pledgor is an organization, the type of organization and any organization
identification number issued to such Pledgor. Each Pledgor agrees to furnish
any
such information to the Collateral Agent promptly upon request. Each Pledgor
also ratifies its authorization for the Collateral Agent to have filed in any
Uniform Commercial Code jurisdiction any like initial financing statements
or
amendments thereto if filed prior to the date hereof. Each Pledgor will not
permit to be effected any amendment or modification of the charter, by-laws,
operating agreements, or other applicable organizational documents of such
Pledgor or any of the Subsidiaries which would (or would be reasonably likely
to) adversely affect the rights or remedies of the Collateral Agent or the
Holders hereunder or the value of the Securities Collateral, except as expressly
permitted under the Purchase Agreement.
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12. Collateral
Agent’s Exoneration.
Under no
circumstances shall the Collateral Agent be deemed to assume any responsibility
for or obligation or duty with respect to any part or all of the Securities
Collateral of any nature or kind or any matter or proceedings arising out of
or
relating thereto, other than (a)
to
exercise reasonable care in the physical custody of the Securities Collateral
and (b) after a Default or an Event of Default shall have occurred and be
continuing to act in a commercially reasonable manner. None of the Collateral
Agent nor any Holder shall be required to take any action of any kind to
collect, preserve or protect its or any Pledgor’s rights in the Securities
Collateral or against other parties thereto. The Collateral Agent’s prior
recourse to any part or all of the Securities Collateral shall not constitute
a
condition of any demand, suit or proceeding for payment or collection of any
of
the Obligations. This Agreement constitutes a pledge of the Securities
Collateral and any other applicable collateral hereunder only, and not an
assignment of any duties or obligations of any Pledgor with respect thereto,
and
by its acceptance hereof and whether or not the Collateral Agent shall have
exercised any of its rights or remedies hereunder, none of the Collateral Agent
or the Holders undertake to perform or discharge, and none of the Collateral
Agent or the Holders shall be responsible or liable for the performance or
discharge of any such duties or responsibilities, including, without limitation,
for any capital calls. Each Pledgor agrees that, notwithstanding the exercise
by
the Collateral Agent of any of its rights hereunder, such Pledgor shall remain
liable nonetheless for the full and prompt performance of all of such Pledgor’s
obligations and liabilities under any operating agreement, limited partnership
agreement, or similar document evidencing or governing any units of membership
interest or limited partnership interest in any limited liability company or
limited partnership included in the Securities Collateral. Under no
circumstances shall the Collateral Agent, any of the Holders or any holder
of
any of the Obligations as such be deemed to be a member, limited partner, or
other equity owner of any of the Subsidiaries by virtue of the provisions of
this Agreement unless expressly agreed to in writing by the Collateral Agent
or
such Secured Party or such holder. Without limiting the generality of the
foregoing, neither of the Collateral Agent nor the Holders shall have any
fiduciary duty as such to any Pledgor or any other equity owner of any of their
Subsidiaries by reason of this Agreement, whether by virtue of the security
interests and liens hereunder, or any enforcement action in respect of such
security interests and liens, unless and until the Collateral Agent or such
Secured Party is actually admitted to the applicable Subsidiary as a substitute
member or substitute equity owner thereof after exercising enforcement rights
under part 6 of Division 9 of the Uniform Commercial Code in effect in the
applicable jurisdiction, or otherwise.
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9
-
13. No
Waiver, etc.
Except
as provided in Section 1.2 hereof, neither this Agreement nor any term hereof
may be changed, waived, discharged or terminated except by a written instrument
expressly referring to this Agreement and to the provisions so modified or
limited, and executed by the Collateral Agent, with the consent of the Majority
Holders, if required, and the Pledgors. No act, failure or delay by the
Collateral Agent shall constitute a waiver of its rights and remedies hereunder
or otherwise. No single or partial waiver by the Collateral Agent of any default
or right or remedy that it may have shall operate as a waiver of any other
default, right or remedy or of the same default, right or remedy on a future
occasion. Each Pledgor hereby waives presentment, notice of dishonor and protest
of all instruments, included in or evidencing any of the Obligations or the
Securities Collateral, and any and all other notices and demands whatsoever
(except as expressly provided herein or in the Purchase Agreement).
14. Registration
and Filing.
Each
Pledgor (a) has caused each Subsidiary of such Pledgor to duly register the
security interests granted hereby on the respective books of such Subsidiary
and
has furnished the Collateral Agent with evidence thereof, (b) has duly executed
and caused any financing statements with respect to the Securities Collateral
to
be filed in such a manner and in such places as may be required by law in order
to fully protect the rights of the Collateral Agent and the Holders hereunder,
and (c) will cause any financing statements with respect to the Securities
Collateral at all times to be kept recorded and filed at each of the respective
Subsidiaries’ expense in such a manner and in such places as may be required by
law in order to fully perfect the interests and protect the rights of the
Collateral Agent and the Holders hereunder.
15. Notice,
etc.
All
notices, requests and other communications hereunder shall be made in the manner
set forth in §17 of the Purchase Agreement.
16. Termination.
Upon
final payment and performance in full in cash of the Obligations and the
termination of all lending and other credit commitments of the Collateral Agent
and the Holders in respect thereof, this Agreement shall terminate and the
Collateral Agent shall, at Pledgors’ request and expense, return such Securities
Collateral in the possession or control of the Collateral Agent as has not
theretofore been disposed of pursuant to the provisions hereof, together with
any moneys and other property at the time held by the Collateral Agent
hereunder.
17. Overdue
Amounts.
Until
paid, all amounts due and payable by Pledgors hereunder shall be a debt secured
by the Securities Collateral and shall bear, whether before or after judgment,
interest at the rate of interest for overdue principal set forth in the Purchase
Agreement.
18. Governing
Law; Consent to Jurisdiction.
THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF
THE COMMONWEALTH OF MASSACHUSETTS. Each Pledgor agrees that any suit for the
enforcement of this Agreement may be brought in the courts of the Commonwealth
of Massachusetts or any federal court sitting therein and consents to the
non-exclusive jurisdiction of such court and to service of process in any such
suit being made upon such Pledgor by mail at the address specified in Section
17
of the Purchase Agreement. Each Pledgor hereby waives any objection that it
may
now or hereafter have to the venue of any such suit or any such court or that
such suit is brought in an inconvenient court.
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10
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19. Waiver
of Jury Trial.
EACH OF
THE PLEDGORS WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR
CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, ANY RIGHTS
OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF ANY SUCH RIGHTS OR OBLIGATIONS.
Except as prohibited by law, each of the Pledgors waives any right which it
may
have to claim or recover in any litigation referred to in the preceding sentence
any special, exemplary, punitive or consequential damages or any damages other
than, or in addition to, actual damages. Each Pledgor (a) certifies that neither
the Collateral Agent nor any Holder nor any representative, Collateral Agent
or
attorney of the Collateral Agent or any Holder has represented, expressly or
otherwise, that the Collateral Agent or any Holder would not, in the event
of
litigation, seek to enforce the foregoing waivers and (b) acknowledges that,
in
entering into the Purchase Agreement and the other Financing Agreements to
which
the Collateral Agent or any of the Holders is a party, the Collateral Agent
and
the Holders are relying upon, among other things, the waivers and certifications
contained in this §19.
20. Miscellaneous.
The
headings of each section of this Agreement are for convenience only and shall
not define or limit the provisions thereof. This Agreement and all rights and
obligations hereunder shall be binding upon each Pledgor and its respective
successors and assigns, and shall inure to the benefit of the Collateral Agent
and the Holders and their respective successors and assigns. If any term of
this
Agreement shall be held to be invalid, illegal or unenforceable, the validity
of
all other terms hereof shall be in no way affected thereby, and this Agreement
shall be construed and be enforceable as if such invalid, illegal or
unenforceable term had not been included herein. Each Pledgor acknowledges
receipt of a copy of this Agreement.
21. Organizational
Documents.
The
Pledgors and the Subsidiaries hereby acknowledge and agree that each
Subsidiary’s by-laws, operating agreement or partnership agreement, as the case
may be, is hereby amended to include the following language: “any restrictions
upon the transfer of equity interests set forth in this Agreement shall not
apply to the pledge by the shareholders, members or partners, as applicable,
of
a security interest in and to their equity interests to Woodside Agency
Services, LLC, as Collateral Agent for certain Holders or Collateral Agent's
successors and assigns (“Collateral
Agent”),
or to
any foreclosure upon or subsequent disposition of such equity interests by
Collateral Agent. Any such transferee shall be admitted as a shareholder, member
or partner, as applicable, and shall have all of the rights of a shareholder,
member or partner, as applicable, that previously owned such equity
interests.”
22. Intercreditor
Agreement.
The
representations, warranties and covenants of the Grantors hereunder, and the
rights and remedies of the Collateral Agent hereunder, are subject to the
provisions of the Intercreditor Agreement and the rights of the Senior Creditor
therein.
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11
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IN
WITNESS WHEREOF,
intending to be legally bound, each Pledgor and the Collateral Agent have caused
this Agreement to be executed as of the date first above written.
|
PLEDGORS
|
|
|
NATIONAL
INVESTMENT
MANAGERS
INC.
|
|
|
By:
|
/s/Xxxxxx
Xxxx
|
|
Name:
Xxxxxx Xxxx
|
|
|
Title:CEO
|
|
|
VALLEY
FORGE ENTERPRISES, LTD.
|
|
|
By:
|
/s/Xxxxxx
Xxxx
|
|
Name:Xxxxxx
Xxxx
|
|
|
Title:CEO
|
|
| BPI/PPA, INC. | |
|
By:
|
/s/Xxxxxx
Xxxx
|
|
Title:
CEO
|
|
|
WOODSIDE
AGENCY SERVICES,
LLC,
as Collateral Agent
|
|
|
By:
|
/s/Xxxxxx
Xxxxx
|
|
Name:
Xxxxxx Xxxxx
|
|
|
Title:
Executive Vice President
|
|
The
undersigned Subsidiaries hereby join in the above Agreement for the sole purpose
of consenting to and being bound by the provisions of §§4.1, 6, 7 and 21
thereof, the undersigned hereby agreeing to cooperate fully and in good faith
with the Collateral Agent and Pledgors in carrying out such
provisions.
|
ABR
ADVISORS, INC.
|
|
ASSET
PRESERVATION CORP.
|
|
BENEFIT
DYNAMICS, INC.
|
|
BENEFIT
MANAGEMENT INC.
|
|
BPI/PPA,
INC.
|
|
CIRCLE
PENSION, INC.
|
|
COMPLETE
INVESTMENT
MANAGEMENT,
INC. OF
PHILADELPHIA
|
|
HADDON
STRATEGIC ALLIANCES, INC.
|
|
LAMORIELLO
& CO.,
INC.
|
|
NATIONAL
ACTUARIAL PENSION
SERVICES,
INC.
|
|
NATIONAL
ASSOCIATES, INC.,
N.W.
|
|
PENSION
ADMINISTRATION
SERVICES,
INC.
|
|
PENTEC,
INC.
|
|
PENTEC
CAPITAL MANAGEMENT,
INC.
|
|
SOUTHEASTERN
PENSION SERVICES,
INC.
|
|
XXXXXXX
X. XXXXX & ASSOCIATES,
INC.
|
|
THE
PENSION ALLIANCE, INC.
|
|
VALLEY
FORGE ENTERPRISES,
LTD.
|
|
V.F.
ASSOCIATES, INC.
|
|
VF
INVESTMENT SERVICES,
CORP.
|
|
VALLEY
FORGE CONSULTING
CORPORATION
|
|
By:/s/Xxxxxx
Xxxx
|
|
Title:
CEO
|
ANNEX
A TO SECURITIES PLEDGE AGREEMENT
|
Issuer
|
Record
Owner
|
Class
|
Number/Percentage
of
Shares Owned
|
Percentage
of
Shares
Pledged
|
||||
|
ABR
Advisors, Inc.
|
Common
|
10/100%
|
100%
|
|||||
|
Asset
Preservation Corp.
|
Common
|
1/100%
|
100%
|
|||||
|
Benefit
Dynamics, Inc.
|
Common
|
500/100%
|
100%
|
|||||
|
Benefit
Management Inc.
|
Common
|
2,000/100%
|
100%
|
|||||
|
BPI/PPA,
Inc.
|
|
Class
A
Common
Class
B
Common
|
10,000/100%
10,000/100%
|
100%
|
||||
|
Circle
Pension, Inc.
|
Common
|
1,000/100%
|
100%
|
|||||
|
Complete
Investment Management, Inc. of Philadelphia
|
Common
|
1,000/100%
|
100%
|
|||||
|
Haddon
Strategic Alliances, Inc.
|
Common
|
250/100%
|
100%
|
|||||
|
Lamoriello
& Co., Inc.
|
Common
|
55/100%
|
100%
|
|||||
|
National
Actuarial Pension Services, Inc.
|
National
Investment Managers Inc.
|
Common
|
1,000/100%
|
100%
|
||||
|
National
Associates, Inc., N.W.
|
National
Investment Managers Inc.
|
Common
|
24,000,000/100%
|
100%
|
||||
|
Pension
Administration Services, Inc.
|
National
Investment Managers Inc.
|
Common
|
40/100%
|
100%
|
||||
|
Pentec,
Inc.
|
National
Investment Managers Inc.
|
Common
|
1/100%
|
100%
|
||||
|
Pentec
Capital Management, Inc.
|
National
Investment Managers Inc.
|
Common
|
1/100%
|
100%
|
|
Southeastern
Pension Services, Inc.
|
National
Investment Managers Inc.
|
Common
|
100/100%
|
100%
|
||||
|
Xxxxxxx
X. Xxxxx & Associates, Inc.
|
National
Investment Managers Inc.
|
Common
|
157.8952/100%
|
100%
|
||||
|
The
Pension Alliance, Inc.
|
National
Investment Managers Inc.
|
Common
|
1/100%
|
100%
|
||||
|
Valley
Forge Enterprises, Ltd.
|
National
Investment Managers Inc.
|
Common
|
1/100%
|
100%
|
||||
|
V.F.
Associates, Inc.
|
Valley
Forge Enterprises, Ltd.
|
Common
|
600/100%
|
100%
|
||||
|
VF
Investment Services Corp.
|
Valley
Forge Enterprises, Ltd.
|
Common
|
600/100%
|
100%
|
||||
|
Valley
Forge Consulting Corporation
|
Valley
Forge Enterprises, Ltd.
|
Common
|
600/100%
|
100%
|
||||
|
Veba
Administrators, Inc.
|
BPI/PPA,
Inc.
|
Common
|
2,000/100%
|
100%
|
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