Exhibit 10.5
FORM OF REPAYMENT AND STOCK PLEDGE AGREEMENT
THIS REPAYMENT AND STOCK PLEDGE AGREEMENT dated as of ______________ is
made and entered into by and between Accuride Corporation, a Delaware
corporation (the "Company"), and ____________ (the "Pledgor").
RECITALS
A. The Company has entered into a Stockholder's Agreement dated as of
____________ with the Pledgor and Hubcap Acquisition L.L.C. (the
"Stockholder's Agreement") whereby the Company has agreed to issue and
sell to Pledgor certain shares of common stock, par value $0.01 per
share, of the Company (the "Common Stock"), and has granted or may in
the future grant to Pledgor options to purchase Common Stock.
B. As part of the purchase price for the Purchase Stock (as defined in
the Stockholder's Agreement), the Pledgor is delivering to the Company
the promissory note of the Pledgor of even date herewith in the
principal amount of $___________ (the "Note").
C. The Pledgor wishes to grant further security and assurance to the
Company in order to secure the payment of the Note and, to that
effect, to pledge to the Company the Stock (as defined in the
Stockholder's Agreement) to be acquired pursuant to the Stockholder's
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the parties hereto agree as follows:
1. PLEDGE.
(a) As security for the payment and performance of all obligations of the
Pledgor on the Note, including the payment of the principal of and interest on
the Note, and in order to secure the Pledgor's obligations under this Agreement,
the Pledgor hereby delivers, pledges and assigns the Stock to the Company and
creates in the Company a security interest in the Pledged Securities (as defined
below).
(b) The "Pledged Securities" under this Agreement shall consist of
the Stock and all securities, certificates and instruments representing or
evidencing ownership of the Pledged Securities hereunder, and all proceeds and
products of any Pledged Securities hereunder, including, without limitation,
stock, cash, property or other dividends, securities, rights and other property
now or hereafter at any time or from time to time received, receivable or
otherwise distributed or distributable in respect of or in exchange for any or
all of such Pledged Securities including proceeds delivered to the Pledgee
pursuant to Section 2 and any substituted or additional Pledged Securities
required to be supplied under the terms of this Agreement.
2. REPAYMENT. The Pledgor hereby agrees that at any time if the Pledgor shall
have received any cash payment or other distribution in respect of, or upon
transfer, sale or other disposition of, the Pledged Securities, then and in each
case until the Note is paid in full (including interest), the Pledgor shall
immediately deliver to the Company such amount (net of applicable income taxes
at the Pledgor's actual rate) in partial or full payment of the principal and
interest on the Note.
3. ADMINISTRATION OF PLEDGED SECURITIES. The following provisions shall
govern the administration of the Pledged Securities:
(a) So long as no Event of Default (as defined below) has occurred and is
continuing the Pledgor shall be entitled to act with respect to the Pledged
Securities in any manner not inconsistent with this Agreement, the Stockholder's
Agreement, the Note, or any document or instrument delivered or to be delivered
pursuant to or in connection with the Stockholder's Agreement.
(b) The Pledgor shall immediately upon request by the Company and in
confirmation of the security interests hereby created, execute and deliver to
the Company such further instruments, deeds, transfers, assurances and
agreements, in form and substance as the Company shall request, including any
financing statement and amendments thereto, or any other documents, as required
under Delaware law and other applicable law to protect the security interests
created hereunder.
4. DEFAULTS. The occurrence of any one or more of the following events or
conditions shall constitute an "Event of Default" under this Agreement:
(a) The Pledgor fails to make any principal or interest payment required
pursuant to the Note within 30 days of the due date therefor.
(b) The Pledgor makes or has made or furnishes or has furnished, any
material written warranty, representation or statement to Company in connection
with this Agreement, the Note or the Stockholder's Agreement which is or was
false or misleading when made or furnished.
(c) Any lien or encumbrance other than that created by this Agreement is
placed on, or any levy is made on the Pledged Securities, or any portion
thereof, or the Pledged Securities, or any portion thereof, is seized or
attached pursuant to legal process, and such lien, encumbrance, levy, seizure,
or attachment is not removed or released within thirty (30) days from the time
such lien or encumbrance was placed thereon or such levy, seizure or attachment
was effected.
(d) The Pledgor commences any bankruptcy, reorganization or insolvency
proceeding, or other proceeding under any federal, state or other law for the
relief of debtors.
(e) The Pledgor fails to obtain dismissal, within sixty (60) days after
commencement thereof, of any bankruptcy, insolvency, or reorganization
proceeding or other proceeding for relief under any bankruptcy law, including,
without limitation, the Federal Bankruptcy Code, or any law for the relief of
debtors, instituted against the Pledgor by one or more third parties, fails
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to oppose actively such proceeding, or, in any such proceeding defaults or files
an answer admitting the material allegations upon which the proceeding was
based, or alleges its willingness to have an order for relief entered or its
desire to seek liquidation, reorganization or adjustment of its debts.
(f) Any receiver, trustee or custodian is appointed by a court of
competent jurisdiction to take possession of all or any substantial portion of
the assets of the Pledgor and such order is not vacated within sixty days of the
entry thereof.
(g) The Pledgor shall fail generally to pay his or her debts as such debts
become due.
(h) The Pledgor shall effect or there shall otherwise occur a Transfer (as
defined in the Stockholder's Agreement) not otherwise permitted under the
Stockholder's Agreement.
5. REMEDIES IN CASE OF AN EVENT OF DEFAULT.
(a) In case an Event of Default shall have occurred and be continuing, the
Company shall be entitled to vote the Pledged Securities and shall have all of
the remedies of a secured party under the Delaware Uniform Commercial Code, and,
without limiting the foregoing, shall have the right, subject to any necessary
regulatory approvals, to sell, assign and deliver the whole or, from time to
time, any part of the Pledged Securities, or any interest in any part thereof,
at any private sale or at public auction, with or without demand of performance
or other demand, advertisement or notice of the time or place of sale or
adjournment thereof or otherwise (except the Company shall give 10 days' notice
to the Pledgor of the time and place of any sale pursuant to this Section 5),
for cash, and credit or for other property, for immediate or future delivery,
and for such price or prices and on such terms as the Company shall, in its sole
discretion, determine, the Pledgor hereby waiving and releasing any and all
right or equity of redemption whether before or after sale hereunder. At any
such sale the Company may bid for and purchase the whole or any part of the
Pledged Securities so sold free from any such right or equity of redemption.
The Company shall apply the proceeds of any such sale first to the payment of
all costs and expenses, including reasonable attorneys' fees, incurred by the
Company in enforcing its rights under this Agreement and then to the payment of
interest on and principal of the Note, with such payments to be applied in the
Company's sole discretion.
(b) The Pledgor recognizes that the Company may be unable to effect a
public sale of all or a part of the Pledged Securities by reason of certain
prohibitions contained in the Securities Act of 1933, as amended (the "Act"), or
in the rules and regulations promulgated thereunder, but may be compelled to
resort to one or more private sales to a restricted group of purchasers who will
be obliged to agree, among other things, to acquire the Pledged Securities for
their own account, for investment and not with a view to the distribution or
resale thereof. The Pledgor agrees that private sales so made may be at prices
and on other terms less favorable to the seller than if the Pledged Securities
were sold at public sale, and that the Company has no obligation to delay the
sale of the Pledged Securities for the period of time necessary to permit the
registration of the Pledged Securities for public sale under the Act; provided,
however, that no private sale shall be made of the Pledged Securities to any
Affiliate (as defined in the Stockholder's Agreement) of the Company or Hubcap
Acquisition L.L.C. ("Hubcap Acquisition") at a price per
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share of Common Stock less than the lesser of (i) the then Market Price Per
Share or (ii) the Initial Price Per Share of such Common Stock (each as defined
in the Stockholder's Agreement), subject to adjustment to reflect any stock
split, stock dividend, combination of shares, merger or other adjustment to
Common Stock. The Pledgor agrees that a private sale or sales made under the
foregoing circumstances shall be deemed to have been made in a commercially
reasonable manner.
(c) If any consent, approval or authorization of any state, municipal or
other governmental department, agency or authority should be necessary to
effectuate any sale or disposition by the Company pursuant to this Section 5 of
the Pledged Securities, or any partial disposition of the Pledged Securities,
the Pledgor will execute all such applications and other instruments as may be
required in connection with securing any such consent, approval or
authorization, and will otherwise use his or her best efforts to secure the
same.
(d) Neither failure nor delay on the part of the Company to exercise any
right, remedy, power or privilege provided for herein or by statute or at law or
in equity shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, remedy, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege.
6. PLEDGOR'S OBLIGATIONS NOT AFFECTED. The obligations of the Pledgor under
this Agreement shall remain in full force and effect without regard to, and
shall not be impaired or affected by: (a) any subordination, amendment or
modification of or addition or supplement to the Stockholder's Agreement or the
Note, or any assignment or transfer of either thereof; (b) any exercise or non-
exercise by the Company of any right, remedy, power or privilege under or in
respect of this Agreement, the Stockholder's Agreement or the Note, or any
waiver of any such right, remedy, power or privilege; (c) any waiver, consent,
extension, indulgence or other action or inaction in respect of this Agreement,
the Stockholder's Agreement or the Note, or any assignment or transfer of any
thereof; or (d) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like, of the Company or its
successors, whether or not the Pledgor shall have notice or knowledge of any of
the foregoing.
7. TRANSFERS BY PLEDGOR. The Pledgor will not sell, assign, transfer or
otherwise dispose of, grant any option with respect to, or mortgage, pledge or
otherwise encumber the Pledged Securities or any interest therein.
8. ATTORNEY-IN-FACT. The Company or its successor is hereby appointed the
attorney-in-fact of the Pledgor for the purpose of carrying out the provisions
of this Agreement and taking any action and executing any instrument which the
Company reasonably may deem necessary or advisable to accomplish the purposes
hereof, including without limitation, the execution of the applications and
other instruments described in Section 5(c), which appointment as
attorney-in-fact is irrevocable as one coupled with an interest.
9. TERMINATION. Upon payment in full of principal of and interest on the Note
and upon the due performance of and compliance with all of the provisions of the
Note, this Agreement shall terminate, and the Pledgor shall be entitled to the
return of such of the Pledged Securities as has
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not theretofore been sold, released pursuant to Section 5 or otherwise applied
pursuant to the provisions of this Agreement.
10. NOTICES. All notices or other communications required or permitted to be
given hereunder shall be delivered as provided in the Stockholder's Agreement.
11. MISCELLANEOUS. The Company and its assigns shall have no obligation in
respect of the Pledged Securities, except to hold and dispose of the same in
accordance with the terms of this Agreement. This Agreement and any provisions
hereof may be amended, modified, waived, discharged or terminated only by an
instrument in writing signed by the party against which enforcement of the
amendment, modification, waiver, discharge or termination is sought. The
provisions of this Agreement shall be binding upon the successors and assigns of
the Pledgor. The captions in this Agreement are for convenience of reference
only and shall not define or limit the provisions hereof. This Agreement shall
be governed by and construed and enforced in accordance with the laws of the
State of Delaware, without regard to the conflicts of laws rules thereof. This
Agreement may be executed simultaneously in several counterparts, each of which
is an original, but all of which together shall constitute one instrument.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Repayment and Stock
Pledge Agreement to be executed and delivered on the date first above written.
ACCURIDE CORPORATION,
a Delaware corporation
By: ____________________
Its: ____________________
PLEDGOR:
_________________________________
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