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EXHIBIT (d)(2)
STOCK PLEDGE AGREEMENT
This Stock Pledge Agreement (the "Agreement") is made on this _____
day of December, 1995 by and between XXXXXXX XXXXXXX, as Successor Trustee of
the Masoni Trust (as defined below), hereinafter "Xxxxxxx", XXXXX X. XXXXXX,
XXXXX X. XXXXXX, individually and in her capacity as Voting Trustee of the
Voting Trust Agreement (as defined below), and FIRST NATIONAL BANK OF COMMERCE.
WHEREAS, Xxxxx X. Xxxxxx has purchased from Xxxxxxx 339,604 shares of
the common stock in Fair Grounds Corporation, which shares owned by Xxxxx X.
Xxxxxx are represented by the Stock Certificate and the Voting Trust
Certificate (as such terms are defined below); and
WHEREAS, in connection therewith, Xxxxx X. Xxxxxx has executed and
delivered the Promissory Note (as defined herein) to Xxxxxxx; and
WHEREAS, Xxxxx X. Xxxxxx as the beneficial owner of the said shares of
the common stock of Fair Grounds Corporation, desires to pledge the said shares
of common stock to Xxxxxxx as security for payment of the Promissory Note; and
WHEREAS, Xxxxx X. Xxxxxx, as Voting Trustee of the Voting Trust
Agreement, desires to pledge all of her right, title and interest in and to the
said shares of common stock as Voting Trustee to Xxxxxxx as security for
payment of the Promissory Note; and
WHEREAS, the parties desire that First National Bank of Commerce act
as Custodian under the terms and conditions hereof.
NOW, THEREFORE, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, the following terms
shall have the designated meanings:
1.1 Pledgor: Xxxxx X. Xxxxxx.
1.2 Secured Party: Xxxxxxx.
1.3 Corporation: Fair Grounds Corporation, a Louisiana
corporation.
1.4 Masoni Trust: The trusts created under and held
pursuant to the Xxxx X. Xxxxxx Trust Agreement dated January 12, 1981,
as amended, most recently by the Third Restatement of Xxxx X. Xxxxxx
Trust Agreement dated as of April 19, 1991, by and between Xxxx X.
Xxxxxx and Xxxx X. Xxxxxx, Trustee, and by that certain Modification of
Third Restatement of Xxxx X. Xxxxxx Trust Agreement dated August
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7, 1991, and by that certain Modification of Third Restatement of Xxxx
X. Xxxxxx Trust Agreement dated October 24, 1992.
1.5 Voting Trust Agreement: Voting Trust Agreement by and between
Xxxxx X. Krantz, Katcher, and Xxxxx X. Xxxxxx, as Voting Trustee, dated as of
August 31, 1993.
1.6 Promissory Note: That certain Promissory Note dated December __,
1995 in the principal amount of $9,984,358.00 by Xxxxx X. Xxxxxx to Xxxxxxx.
1.7 Voting Trustee: Xxxxx X. Xxxxxx, as Voting Trustee under the
Voting Trust Agreement.
1.8 First National Debt: (i) that certain Promissory Note dated July
17, 1995 made by Corporation payable to the order of First National Bank of
Commerce in the principal sum of $2,150,000.00, and interest, attorneys' fees
and other costs of collection thereof together with any and all renewals,
extensions, modifications and refinancings of and to such promissory note, and
(ii) that certain Promissory Note dated November 7, 1995 made by Corporation
payable to the order of First National Bank of Commerce in the principal sum of
$4,000,000.00, and interest, attorneys' fees and other costs of collection
thereof, together with any and all renewals, extensions, modifications and
refinancings of and to such promissory note, and (iii) any and all additional
indebtedness and obligations of Corporation to First National Bank of Commerce
of any kind or nature, whether now existing or hereafter arising up to a
maximum principal amount of Ten Million Dollars ($10,000,000.00) (which
aggregate limitation shall include the principal sum of the notes described in
Sections 1.8(i) and (ii) herein).
1.9 First National: First National Bank of Commerce, a national
banking association, the address for which is 000 Xxxxxxx Xxxxxx, Xxx Xxxxxxx,
Xxxxxxxxx 00000.
1.10 First National Pledge Agreement: Collectively, (i) that certain
Pledge Agreement dated July 17, 1995 by and between Xxxxxxx, and First
National, (with Xxxxx X. Xxxxxx, Voting Trustee, and Xxxxx X. Xxxxxx as
Intervenors), as amended by that certain First Amendment to Pledge Agreement
dated as of November 7, 1995 by Xxxxxxx, and First National, and as such Pledge
Agreement may be further amended from time to time, and (ii) that certain
Pledge Agreement dated July 17, 1995 by and between Xxxxx X. Xxxxxx, as Voting
Trustee of the Voting Trust Agreement, and First National, (with Xxxxxxx, and
Xxxxx X. Xxxxxx as Intervenors), as such Pledge Agreement may be amended from
time to time.
1.11 Indebtedness: The Promissory Note, together with any and all
renewals, extensions, modifications or refinancings thereof.
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1.12 Pledged Stock: 339,604 shares of the common stock in
Corporation, represented by Stock Certificate No. 12308 dated April 14,
1995 issued in the name of Xxxxx X. Xxxxxx, Voting Trustee, and any and
all certificates representing or evidencing such shares, including
those certificates issued after the date hereof.
1.13 Voting Trust Certificate: That certain Voting Trust
Certificate No. 3 dated December ___, 1995 signed by the Voting
Trustee, and issued to Xxxxx X. Xxxxxx, and any and all such
replacement certificates or similar instruments from time to time
issued by the Voting Trustee to Xxxxx X. Xxxxxx pursuant to the terms
of the Voting Trust Agreement.
1.14 Pledged Securities: The Pledged Stock, the Voting Trust
Certificate, the Stock Certificate, any additional shares of
Corporation hereafter acquired by Xxxxx X. Xxxxxx in any manner,
including, without limitation, as stock dividends, stock splits or
otherwise, or shares received as a result of any merger, consolidation,
share exchange, or similar transaction involving Corporation, and all
certificates representing all such shares, and any stock certificates,
voting trust certificates, notes or other securities now or hereafter
included in the Collateral.
1.15 Uniform Commercial Code: Chapters 1301, 1308 and 1309
of the Ohio Revised Code, as amended from time to time.
1.16 Collateral: (i) the Pledged Stock, (ii) the Voting
Trust Certificate, (iii) the Pledged Securities, (iv) all cash,
property, liquidation and other dividends now or hereafter declared on
the Pledged Stock, and all stock redemption payments and all other
monies due or to become due thereunder, (v) all stock warrants,
options, pre-emptive rights, rights of first refusal and other rights
to subscribe to, purchase or receive any shares of common stock or,
other securities now or hereafter incident or existing or declared or
granted in connection with such Pledged Stock or otherwise, (vi) all
distributions (whether made in cash, money, instruments, income or
other property) received or receivable or otherwise made in connection
with the Pledged Stock or incident thereto, and (vii) all proceeds of
all or any of the foregoing, in whatever form, including without
limitation, all "proceeds" as such term is defined in the Uniform
Commercial Code, of any of the foregoing, and all proceeds of such
proceeds.
1.17 Custodian: First National.
1.18 Stock Certificate: Stock Certificate No. 12308 dated
April 14, 1995 issued in the name of Xxxxx X. Xxxxxx, Voting Trustee,
representing 339,604 shares of the common stock of Corporation, and any
and all certificates representing or evidencing such shares, including
those certificates issued after the date hereof.
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2. Pledge. As security for the payment of indebtedness, Xxxxx X.
Xxxxxx hereby pledges, grants, conveys, assigns, sets over and delivers unto the
Secured Party the Collateral, as collateral security, and grants to the Secured
Party a continuing security interest and lien in, all of his right, title and
interest in and to the Collateral. Xxxxx X. Xxxxxx shall deliver concurrently
herewith to the Custodian stock powers duly executed in blank or other
instruments of transfer satisfactory to the Secured Party and such other
instruments and documents as Secured Party may reasonably request, which blank
stock powers and instruments of transfer may be used by Secured Party in the
exercise of his rights herein granted. The delivery of all other property
comprising any part of the Collateral shall be accompanied by proper
instruments of collateral assignment duly executed by Xxxxx X. Xxxxxx and such
other instruments or documents as Secured Party may reasonably request.
Xxxxx X. Xxxxxx acknowledges and agrees that all Collateral shall be retained
in the possession of the Custodian and/or the Secured Party so long as the
indebtedness remains unpaid.
3. Pledge by Voting Trustee. As security for the payment of the
Indebtedness, Voting Trustee hereby pledges, grants, conveys, assigns, sets over
and delivers unto the Secured Party the Collateral, as collateral security, and
grants to the Secured Party a continuing security interest and lien in, all of
her right, title and interest in and to the Collateral. Voting Trustee shall
deliver concurrently herewith to the Custodian stock powers duly executed in
blank or other instruments of transfer satisfactory to the Secured Party and
such other instruments and documents as Secured Party may reasonably request,
which blank stock powers and instruments of transfer may be used by Secured
Party in the exercise of his rights herein granted. The delivery of all other
property comprising any part of the Collateral shall be accompanied by proper
instruments of collateral assignment duly executed by Voting Trustee and such
other instruments or documents as Secured Party may reasonably request.
Xxxxx X. Xxxxxx, individually and as Voting Trustee, acknowledges and agrees
that all Collateral shall be retained in the possession of the Custodian
and/or the Secured Party so long as the Indebtedness remains unpaid. Xxxxx X.
Xxxxxx, individually and as Voting Trustee, covenants and agrees that she will
not deliver any of the Collateral (including but not limited to the Pledged
Stock, the Voting Trust Certificate, or any of the Pledged Securities) to
Xxxxx X. Xxxxxx until the Indebtedness has been paid in full.
4. First National Debt; Custodian Duties and Responsibilities.
(a) The parties acknowledge and agree that the Pledged
Securities shall remain subject to, and subordinate to, a security interest
granted pursuant to the First National Pledge Agreement. All of the parties
hereto hereby specifically agree to execute any and all documents necessary to
continue, secure and/or perfect the security interest held by First National to
secure the First National Debt, and to subordinate this Agreement to the First
National Pledge Agrement.
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(b) The Custodian hereby acknowledges receipt of (i) the
Voting Trust Certificate, and (ii) the Stock Certificate, which have
been delivered to Custodian in connection with the First National
Pledge Agreement as security for payment of the First National Debt,
and Custodian acknowledges receipt of the Voting Trust Certificate,
Stock Certificate, and Pledged Stock hereunder which shall be held on
behalf of, and for the benefit of, Secured Party as security for
payment of the Indebtedness. Custodian acknowledges and agrees that it
shall hold all Pledged Securities, together with any and all stock
powers and instruments of transfer duly executed in blank and delivered
pursuant hereto, in trust for the benefit of Secured Party in
connection with the pledge of Collateral hereunder and creation of the
security interest herein. Secured Party acknowledges that the security
interest created hereunder shall at all times be subordinate to the
security interest granted pursuant to the First National Pledge
Agreement. Custodian covenants and agrees with Secured Party that
Custodian shall not transfer or deliver any of the Collateral to Xxxxx
X. Xxxxxx or to Voting Trustee so long as the Indebtedness remains
unpaid. In addition, Custodian covenants and agrees with Secured Party
that Custodian shall not transfer or deliver any of the Collateral to
any other persons or entities without the written consent of Secured
Party.
(c) Upon the occurrence of an Event of Default hereunder,
Custodian shall deliver to Secured Party all of the Collateral
(including without limitation the Pledged Securities), for the purposes
of Secured Party's exercise of his rights and remedies hereunder.
(d) Upon the occurrence of an Event of Default hereunder,
Voting Trustee shall deliver to Secured Party such documents and
instruments as shall be necessary for the transfer of ownership of the
Pledged Securities to Secured Party, including without limitation, the
issuance of a voting trust certificate which reflects the ownership of
the Pledged Stock in Secured Party.
(e) Xxxxx X. Xxxxxx shall pay all costs and fees of
Custodian hereunder.
(f) The Custodian shall be entitled to exercise all such
powers hereunder as are specifically delegated to the Custodian by the
terms hereof, together with such powers as are reasonably incidental
thereto. The Custodian may execute any of its duties hereunder by or
through agents or employees and shall be entitled to retain counsel of
its own choice and to act in reliance upon the advice of such counsel
concerning all matters pertaining to its duties hereunder. The
Custodian agrees to hold the Collateral, and the proceeds thereof, at
any time received, for the benefit of Secured Party and/or subsequent
holders of the Promissory Note. However, unless otherwise provided, the
Custodian shall not be required to exercise any right or remedy granted
to it hereunder unless directed to do so by the holder of the
Promissory Note, and shall in all cases be fully protected in acting or
in refraining from acting in accordance with written instructions
signed by such holders. Unless and until written notice of the
assignment or transfer thereof shall have been filed with the
Custodian, the Custodian may deem and treat Secured Party as the holder
of the Promissory Note for all purposes hereof.
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(g) Custodian covenants and agrees with Secured Party that
Custodian shall deliver all of the Collateral in its possession
(including without limitation the Pledged Securities) to Secured Party,
or his successor, upon payment in full of the First National Debt.
5. Representations and Warranties. Xxxxx X. Xxxxxx and Voting
Trustee hereby jointly and severally represent, warrant and covenant to and with
the Secured Party that:
(a) There are no outstanding options, warrants or similar
rights with respect to the Pledged Stock.
(b) The Voting Trustee and Xxxxx X. Xxxxxx have the full
power and authority to grant to the Secured Party a valid and
enforceable perfected and continuing lien on and security interest in
the Collateral pursuant to this Pledge Agreement.
(c) The Pledged Stock and all Pledged Securities that may
from time to time be delivered to the Custodian and the Secured Party
are fully paid and non-assessable, duly and validly authorized and
issued and, upon execution hereof, will be duly and validly pledged to
the Secured Party in accordance with all provisions of applicable law.
(d) Xxxxx X. Xxxxxx has good and marketable title to, and is
the beneficial owner of, the Pledged Stock, the legal ownership of
which is vested in the Voting Trustee under the terms of the Voting
Trust Agreement, free and clear of all liens, except for the lien
created pursuant to the First National Pledge Agreement and for the
lien created by this Agreement.
(e) Upon the execution and delivery of this Agreement and the
delivery to the Custodian of the Pledged Stock and the Voting Trust
Certificate, the Secured Party shall have a valid and enforceable lien
on and security interest in and to the Collateral; such lien and
security interest shall constitute a perfected security interest in
such Collateral, superior to the rights and equitable interests of all
other persons in the Collateral except for First National.
(f) The execution, delivery and performance of this Agreement
by Xxxxx X. Xxxxxx and by Voting Trustee and the granting of a valid
and enforceable lien and security interest in the Collateral will not
(i) violate any provision of any law, any judgment, order, rule or
regulation of any court, arbitration panel, or other governmental
authority, domestic or foreign, or other person, (ii) violate any
provision of any indenture, agreement, mortgage, contract or other
instrument to which either of them is a party or by which any of their
properties, assets or revenues are bound, or be in conflict with,
result in an acceleration of any obligation or a breach of or
constitute (with notice or lapse of time or both) a default under, any
such indenture, agreement, mortgage, contract or other instrument, or
(iii) result in the creation or imposition of any lien on any of the
properties, assets or revenues of Xxxxx X. Xxxxxx, except those in
favor of Secured Party as provided herein.
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(g) This Agreement has been duly executed and delivered by
Xxxxx X. Xxxxxx and constitutes the legal, valid and binding obligation
of Xxxxx X. Xxxxxx enforceable against him in accordance with its
terms.
(h) This Agreement has been duly authorized, executed and
delivered by Xxxxx X. Xxxxxx, both individually and in her capacity as
Voting Trustee, and constitutes the legal, valid and binding obligation
of Xxxxx X. Xxxxxx enforceable against her in accordance with its
terms.
(i) No registration with or consent or approval of, or other
action by, any governmental authority, domestic or foreign, or other
person is required (other than such approvals or consents which may
have been obtained) in connection with the execution, delivery and
performance of this Agreement and the granting of the valid and
enforceable lien and security interest in the Collateral in favor of
Secured Party.
6. Covenants. Xxxxx X. Xxxxxx hereby covenants and agrees with
Secured Party as follows:
(a) Xxxxx X. Xxxxxx will cause any additional securities
issued to or received by him with respect to any of the Collateral,
whether for value paid by him or otherwise, to be forthwith deposited
with Custodian and pledged to the Secured Party hereunder, such
additional securities to be accompanied by proper instruments of
assignment duly executed in blank by Xxxxx X. Xxxxxx or as the Secured
Party may, in his sole and absolute discretion, request.
(b) Except for the lien and security interest granted by this
Agreement and which also exists pursuant to the First National Pledge
Agreement, the Collateral is now, and at all times will be, maintained
by Xxxxx X. Xxxxxx free and clear of all liens.
(c) Xxxxx X. Xxxxxx will, at his sole cost and expense,
perform all acts and execute all documents reasonably requested of him
by the Secured Party from time to time to evidence, perfect, maintain
or enforce Secured Party's perfected lien and security interest in the
Collateral granted hereby, or otherwise in furtherance of the
provisions of this Agreement, and the transactions contemplated hereby,
including without limitation, any act which may be required to effect
the disposition of the Collateral.
(d) Xxxxx X. Xxxxxx shall reimburse Secured Party for any and
all sums, costs, and expenses which the Secured Party may pay in
connection with defending, protecting or enforcing this Agreement,
including without limitation, court costs, collection charges,
reasonable fees and disbursements of his attorneys and other experts.
(e) Within ten (10) days after Xxxxx X. Xxxxxx has knowledge
thereof, he shall give written notice to Secured Party of any levy or
attachment, execution or other process against any of the Collateral.
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(f) Within ten (10) days after Xxxxx X. Xxxxxx has
knowledge thereof, he shall give Secured Party written notice of any
Event of Default or event which, with the giving of notice or lapse of
time or both, would become an Event of Default, specifying the nature
and extent thereof and the corrective action, if any, proposed to be
taken with respect thereto.
(g) Xxxxx X. Xxxxxx covenants that, so long as any
indebtedness or any part thereof remains unpaid, he shall not sell,
offer to sell, convey or otherwise transfer or dispose of any of the
Collateral or any interest therein, nor will he create, incur or
permit to exist any pledge, mortgage, lien, charge, encumbrance,
security interest, restriction on transfer, right to purchase, option,
right of first refusal or other impediment to title whatsoever with
respect to any of the Collateral except for the lien pursuant to the
First National Pledge Agreement.
(h) Xxxxx X. Xxxxxx covenants that, so long as any
indebtedness or any part thereof remains unpaid, he shall not amend or
agree to amend any shareholder's agreement, including without
limitation the Voting Trust Agreement.
7. Voting Rights, Dividends, Etc.
(a) Unless and until an Event of Default (as defined in this
Agreement) shall have occurred and be continuing:
(i) the Voting Trustee shall be entitled to
exercise any and all voting and/or other consensual rights
and powers accruing to an owner of the Pledge Securities or
any part thereof for any purpose consistent with the terms of
the Voting Trust Agreement and this Agreement.
(ii) Xxxxx X. Xxxxxx shall be entitled to receive
and retain any and all cash dividends paid on the Pledge
Securities.
(b) Upon the occurrence of an Event of Default, all rights of
Xxxxx X. Xxxxxx to receive any dividends which he is authorized to
receive pursuant to paragraph (a)(ii) of this Section 7 shall
immediately and without any action or notice cease, and all such rights
shall thereupon become vested in Secured Party, which shall have the
sole and exclusive right and authority to receive and retain such
dividends.
(c) Upon the occurrence of an Event of Default, all rights of
the Voting Trustee to exercise the voting and consensual rights and
powers which she is entitled to exercise pursuant to the Voting Trust
Agreement and paragraph (a)(i) of this Section 7 shall, immediately and
without any action or notice cease, and all such rights shall thereupon
become vested in Secured Party, which shall have the sole and exclusive
right and authority to exercise such voting and consensual rights and
powers.
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8. Defaults. The occurrence of any of the following shall
constitute an event of default ("Event of Default") under this Agreement:
(a) Occurrence of "Default" under the Promissory Note (as
such "Default" is defined therein); or
(b) Default by Xxxxx X. Xxxxxx or by the Voting Trustee in
the observance or performance of any of the covenants, terms,
conditions or agreements on the part of Xxxxx X. Xxxxxx or Voting
Trustee contained in this Agreement; or
(c) Should any representation or warranty in this Agreement
prove to be incorrect or misleading in any material respect.
9. Remedies upon Default.
(a) The parties acknowledge that the Promissory Note is a
non-recourse obligation as to Xxxxx X. Xxxxxx, and that it is the
intent and agreement of the parties that transfer of ownership of all
of the Pledged Securities to Secured Party shall be made upon the
occurrence of an Event of Default hereunder. It is the intent of the
parties that Secured Party's receipt of full ownership of such Pledged
Securities by Secured Party upon the occurrence of an Event of Default
hereunder shall constitute full satisfaction of the Indebtedness and
shall be Secured Party's sole remedy, except as otherwise provided
herein.
(b) Upon the occurrence and continuance of an Event of
Default hereunder, and the acceleration of the principal balance of
the Promissory Note and all amounts payable thereunder, the Secured
Party shall be entitled to exercise the following rights, which Xxxxx
X. Xxxxxx and Voting Trustee hereby agree to be commercially
reasonable:
(i) To transfer ownership of all of the Collateral
(including without limitation the Pledged Securities) to
Secured Party, and into Secured Party's name, it being
acknowledged and agreed that Secured Party shall thereafter
have good and marketable title to, and all beneficial
ownership of, the Collateral, the legal ownership of which
shall be in the Voting Trustee under the terms of the Voting
Trust Agreement (and the legal ownership of which shall be in
Secured Party in the event of the termination of the Voting
Trust Agreement).
(c) Upon transfer of ownership of the Collateral to Secured
Party pursuant to Section 9(b)(i), Voting Trustee shall issue a voting
trust certificate to Secured Party which reflects the ownership of the
Pledged Stock in Secured Party.
(d) Secured Party shall comply with Section 1309.48(B) of
the Uniform Commercial Code in the exercise of his remedy herein.
Xxxxx X. Xxxxxx and Voting Trustee covenant and agree that they
will not object to the Secured Party's proposal to retain the
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Collateral in satisfaction of the Indebtedness, which proposal shall be
made in compliance with the said Section 1309.48(B). The parties agree
that Secured Party may retain the Collateral in satisfaction of the
Indebtedness twenty-one (21) days after Secured Party's compliance with
Section 1309.48(B), so long as Secured Party has not received objection
thereto from persons (other than Xxxxx X. Xxxxxx and Voting Trustee)
entitled to receive notification thereunder.
(e) If any objections are received by Secured Party under Section
1309.48(B), or if the terms and conditions hereunder with respect to
Secured Party's retention of the Collateral as his sole remedy are
determined to be invalid or unenforceable for any reason, then the
Secured Party shall dispose of the Collateral under Section 1309.47 of
the Uniform Commercial Code, and Secured Party, in addition thereto,
shall be entitled to exercise all of the rights, powers and remedies of
a Secured Party under the Uniform Commercial Code for the protection
and enforcement of his rights in respect of the Collateral, and the
Secured Party shall be entitled, without limitation, to exercise the
following rights, which Xxxxx X. Xxxxxx and Voting Trustee hereby agree
to be commercially reasonable:
(i) To sell the Collateral, or any part thereof, at
any public or private sale for cash, upon credit or for future
delivery. At any public sale made pursuant to this Section
9(e)(i), the Secured Party may bid for or purchase the
Collateral (including without limitation the Pledged
Securities) or any part thereof and may make payment on
account therefor by using any claim then due and payable to
the Secured Party from Xxxxx X. Xxxxxx (including without
limitation the Indebtedness) as a credit against the purchase
price. Secured Party may, upon compliance with the terms of
sale, hold, retain, and dispose of such property without
further accountability. As an alternative to exercising the
power of sale herein conferred upon it, Secured Party may
proceed by a suit or suits at law or in equity to foreclose
this Agreement and to sell the Collateral, or any portion
thereof, pursuant to a judgment or order or decree of a court
or courts of competent jurisdiction.
(ii) Xxxxx X. Xxxxxx and Voting Trustee recognize
that Secured Party may be unable to effect a public sale of
all or part of the Collateral by reason of certain
prohibitions contained in the Securities Act of 1933, as
amended (the "Act"), and other applicable state and federal
securities laws, and authorize Secured Party to resort to one
or more private sales to a responsible restricted group of
bidders and purchasers who will be obligated to agree, among
other things, to acquire all or a part of the Collateral for
their own account, for investment, and not with a view to the
distribution or resale thereof. If Secured Party deems it
advisable to do so for the foregoing or for other reasons,
Secured Party is authorized to limit the prospective bidders
on or purchasers of any of the Collateral to such a restricted
group of purchasers and may cause to be placed on certificates
for any or all of the Collateral a legend to the effect that
such security has not been registered under the Act and may
not be disposed of in violation of the provisions of said Act,
and to impose such other limitations or conditions in
connection with such sale, as Secured Party deems necessary or
advisable in order to comply with said Act or any other
securities or other laws. If any consent, approval, or
authorization of any federal, state, municipal or other
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governmental department, agency or authority should be
necessary to effectuate any sale or other disposition of the
Collateral, or any partial sale or other disposition of the
Collateral, Xxxxx X. Xxxxxx and Voting Trustee will execute
all applications and other instruments as may be required in
connection with securing any such consent, approval or
authorization and will otherwise use their best efforts to
secure same.
(iii) If in the opinion of counsel to Secured Party
it is advisable to have the Collateral or the portion thereof
to be sold registered under the provisions of the Act, Xxxxx
X. Xxxxxx and Voting Trustee hereby agree (1) to execute and
deliver, and to use their best efforts to cause Corporation
and its directors and officers to execute and deliver, 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
opinion of Secured Party, advisable to register the Collateral
or the portion thereof to be sold, under the provisions of the
Act and to cause the registration statement relating thereto
to become effective and to remain effective for such period as
prospectuses are required by law to be furnished, and to make
or cause to be made all amendments and supplements thereto and
to the related prospectus, which, in the opinion of Secured
Party, are necessary or advisable, all in conformity with the
requirements of the Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto, (2) to
use their best efforts to qualify the Collateral under state
Blue Sky or securities laws and to obtain the approval of any
governmental authorities for the public sale of the
Collateral, including all necessary gaming authorities'
approvals, as requested by Secured Party, and (3) at the
request of Secured Party, to indemnify and hold harmless
Secured Party and the holder or holders of the Indebtedness,
from and against any loss, liability, claim, damage and
expense, including reasonable attorneys' fees incurred in
connection therewith, under the Act or otherwise insofar as
such loss, liability, claim, damage or expense arises out of
or is based upon any actual or alleged untrue statement of a
material fact contained in such registration statement or
supplement thereto, or arises out of or is based upon any
omission or alleged omission to state therein a material fact
required to be stated or necessary to make the statements
therein not misleading. Xxxxx X. Xxxxxx shall pay for all
costs and expenses incurred in connection with the
registration of the Collateral under the Act.
10. Secured Party Appointed Attorney-in-Fact. Xxxxx X. Xxxxxx
hereby appoints the Secured Party as his attorney-in-fact for the purpose of
carrying out the provisions of this Agreement and taking any action and
executing any instrument which the Secured Party may deem necessary or advisable
to accomplish the purposes hereof after the occurrence of an Event of Default.
It is understood and agreed that the power of attorney granted to the Secured
Party for the purposes set forth above in this Section 10 is coupled with an
interest and is irrevocable and Xxxxx X. Xxxxxx hereby ratifies all actions
taken by his attorney-in-fact by virtue hereof. The provisions of this Section
10 shall in no event relieve Xxxxx X. Xxxxxx of any of his obligations hereunder
with respect to the Collateral or any part thereof or impose any obligation on
the Secured Party to proceed in any particular manner with respect to the
Collateral or any part thereof, or in any way limit the exercise by the Secured
Party of any other or further right which he may have on the date of this
Agreement
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or hereafter, whether hereunder, by law or otherwise. Without limiting the
generality of the foregoing, after the occurrence and during the continuance of
an Event of Default, the Secured Party shall have the right and power to
receive, endorse and collect all checks and other orders for the payment of
money made payable to Xxxxx X. Xxxxxx representing any dividend or other
distribution payable in respect of the Collateral or any part thereof and to
give full discharge for the same.
11. No Waiver. No failure on the part of Secured Party to
exercise, and no delay in exercising, any right, power or remedy hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right, power or remedy by the Secured Party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
All remedies hereunder are cumulative and are not exclusive of any other
remedies provided by law.
12. Termination. This Agreement shall terminate when the
Indebtedness has been paid in full, at which time the Secured Party shall
promptly reassign and deliver to Xxxxx X. Xxxxxx, against receipt, the
Collateral, together with appropriate instruments of reassignment and release.
Any such reassignment shall be without recourse to or warranty by the Secured
Party and at the cost and expense of Xxxxx X. Xxxxxx.
13. Nothing herein contained shall be deemed to impair in any
manner the absolute right, in accordance with the terms of this Agreement, of
the Secured Party, at any time after the occurrence and continuance of an Event
of Default, to realize upon the Collateral at such time and in such order as he
may elect, in his sole and absolute discretion, or to enforce any one or more of
his remedies, individually or cumulatively, relative hereto either successively
or concurrently, and Xxxxx X. Xxxxxx and Voting Trustee hereby agree that the
liens, options and other rights hereby given to the Secured Party shall remain
unimpaired and unprejudiced and that the enforcement of any remedy shall not
operate to bar or estop the Secured Party from exercising any other right or
remedy. Each and every remedy of the Secured Party shall be in addition to any
other remedy given hereunder or now or hereafter existing at law or in equity
or by statute or otherwise.
14. Notices. Any notice or demand which, by provision of this
Agreement, is required or permitted to be given or served upon a party shall be
deemed to have been sufficiently given and served for all purposes (if mailed)
five (5) calendar days after being deposited, postage prepaid, in the United
States mail, registered or certified mail, or (if delivered by express courier)
one (1) calendar day after being delivered to such courier, or (if delivered in
person) the same day as delivery, or (if delivered by facsimile transmission)
on the day reception is confirmed, in each case addressed (until another
address or addresses are given in writing by a party to the other parties by
notice hereunder) as follows:
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If to Xxxxx X. Xxxxxx:
Xx. Xxxxx X. Xxxxxx
00 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Telecopy No.: c/o Xxxxx X. Xxxxxxx, Esq.
000-000-0000
with a copy to:
Xxxxx X. Xxxxxxx, Esq.
Chehardy, Sherman, Ellis, Xxxxxxx & Xxxxxx
Xxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
Telecopy No.: 000-000-0000
If to Secured Party:
Xx. Xxxxxxx Xxxxxxx
Four Commerce Park Square
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Telecopy No.: 216-164-7609
with a copy to:
P. Xxxxxxx Xxxx, Esq.
Reminger & Reminger Co., L.P.A.
The 000 Xx. Xxxxx Xxxx., #000
Xxxxxxxxx, XX 00000
Telecopy No.: 000-000-0000
If to Voting Trustee:
Xxxxx X. Xxxxxx
00 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Telecopy No.: c/o Xxxxx X. Xxxxxxx, Esq.
000-000-0000
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with a copy to:
Xxxxx X. Xxxxxxx, Esq.
Chehardy, Sherman, Ellis, Xxxxxxx & Xxxxxx
Xxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000
Telecopy No.: 000-000-0000
If to Custodian:
First National Bank of Commerce
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Telecopy No.: 000-000-0000
with a copy to:
Liskow & Xxxxx
Xxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000-0000
Attn: Wm. Xxxxx Xxxxxxx, Esq.
Telecopy No.: 000-000-0000
15. Further Assurances. Xxxxx X. Xxxxxx and Voting Trustee
agree, at their sole cost and expense, to do such further acts and things, and
to execute and deliver such additional conveyances, assignments, agreements and
instruments, with respect to the administration and enforcement of this
Agreement or with respect to the Collateral or any part thereof or in order
better to assure and confirm unto the Secured Party his rights and remedies
hereunder. Without limiting the foregoing agreements, Xxxxx X. Xxxxxx and Voting
Trustee agree to do such further acts and things, and to execute and deliver
such additional documents, necessary for the perfection of the security interest
in the Collateral in Secured Party pursuant to the laws of the State of
Louisiana.
16. Binding Agreement; Assignments. This Agreement, and the
terms, covenants and conditions hereof, shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, assigns, heirs,
executors, administrators, and personal representatives, except that Xxxxx X.
Xxxxxx shall not be permitted to assign this Agreement or any interest herein or
in the Collateral, or any part thereof, or otherwise pledge, encumber or grant
any option with respect to the Collateral, or any part thereof, or any cash or
property held by Secured Party as Collateral under this Agreement except as
expressly permitted by this Agreement.
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17. Xxxxx X. Xxxxxx Not Discharged. The obligations of Xxxxx X.
Xxxxxx and Voting Trustee under this Agreement shall be absolute and
unconditional and shall remain in full force and effect without regard to, and,
to the fullest extent permitted by applicable law, shall not be released,
discharged or in any way affected by, (a) any amendment, modification or waiver
of any provision of any instrument evidencing any part of the indebtedness,
including, without limitation, any change in the rate of interest thereon; (b)
any exercise or non-exercise of any right, remedy, power or privilege under or
in respect of this Agreement or any other instrument evidencing any part of the
Indebtedness or with respect to applicable law, including, without limitation,
any waiver, consent, extension, indulgence or other action or inaction
hereunder; (c) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or similar proceeding of, or affecting,
Xxxxx X. Xxxxxx, the Voting Trustee, or Secured Party; or (d) any other act or
thing or omission or delay to do any other act or thing which may or might in
any manner or to any extent vary the risk of Xxxxx X. Xxxxxx or would otherwise
operate as a discharge of Xxxxx X. Xxxxxx as a matter of law.
18. Waiver by Xxxxx X. Xxxxxx. Xxxxx X. Xxxxxx hereby
unconditionally and irrevocably waives, to the fullest extent permitted by
applicable law, presentment, protest, demands, notice of protest, notice of
demand and dishonor and notice of nonpayment of any instruments included in or
evidencing any of the Indebtedness or the Collateral.
19. Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of Ohio without regard to
principles of conflicts of laws. The parties hereby irrevocably and
unconditionally waive any claim to assert that the law of any other jurisdiction
should govern this Agreement. This Agreement may not be modified or amended,
except by a written instrument signed by each of the parties hereto. Xxxxx X.
Xxxxxx and Voting Trustee hereby knowingly, voluntarily, intentionally and
irrevocably waive all right to a trial by jury with respect to any litigation
based on the Indebtedness or this Agreement. Any suit or proceeding arising out
of the Indebtedness or this Agreement may be brought in any appropriate federal
or state court located in Cuyahoga County, Ohio. Xxxxx X. Xxxxxx, Voting
Trustee, and Custodian hereby submit themselves and consent to the personal
jurisdiction of any court in Cuyahoga County, Ohio, and waive any defense that
they may have based on lack of personal jurisdiction, and agree not to assert,
by way of motion, as a defense, or otherwise, in any such action, suit or
proceeding, any claim that they are not subject personally to the jurisdiction
of such courts in Ohio, that the action, suit or proceeding is brought in an
inconvenient forum, or that venue is improper, or that the subject matter may
not be enforced by such court.
20. Severability. In the event that any one or more of the
provisions contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.
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21. Intervention. To the extent that any provision of the Voting
Trust Agreement, including without limitation Section 5 thereof, may be
construed to prohibit any encumbrance on the Collateral, Xxxxx X. Xxxxxx, the
Secured Party, and Voting Trustee do hereby waive any such prohibition which may
be contained within the Voting Trust Agreement, and do consent to the terms of
this Agreement and agree that the transactions provided for herein, including
without limitation, the pledge of the Pledged Stock to Secured Party hereunder,
shall not constitute a default under the Voting Trust Agreement.
22. First National Consent. First National hereby consents to
the pledge of the Pledged Securities by Xxxxx X. Xxxxxx to Secured Party
hereunder, the grant and creation of the security interest in the Pledged
Securities hereunder, and the transactions contemplated herein. Accordingly,
First National acknowledges and agrees that this Stock Pledge Agreement, and
the transactions contemplated hereunder, do not constitute an Event of Default
under the First National Pledge Agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
----------------------------------
XXXXXXX XXXXXXX, Trustee
of the Masoni Trust
-----------------------------------
XXXXX X. XXXXXX
----------------------------------
XXXXX X. XXXXXX, individually and
as Voting Trustee
Custodian:
FIRST NATIONAL BANK OF COMMERCE
By:
--------------------------------
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