Exhibit F
PLEDGE AND SECURITY AGREEMENT, dated as of May 5, 1999, between
XXXXXXXX XXXXXXX (the "Pledgor") and THE XXXXXXX SACHS GROUP, L.P., its
successors and assigns (the "Secured Party").
WITNESSETH:
WHEREAS, pursuant to a promissory note (the "Note"), dated May 5, 1999
the Pledgor has borrowed from the Secured Party the principal amount of
$825,000; and
WHEREAS, the Pledgor has agreed to secure its obligations under the
Note pursuant to this Pledge and Security Agreement; and
WHEREAS, the terms "Security Entitlement", "Control", "Proceeds" and
"Securities Intermediary" shall have the respective meanings ascribed to them in
the New York Uniform Commercial Code (the "NYUCC");
NOW THEREFORE, the parties hereto agree as follows:
1. Pledgor's Grant of Security Interest in Collateral.
For value received and to induce the Secured Party to make the loan
evidenced by the Note, Pledgor hereby grants to the Secured Party, as security
for the prompt and complete payment and performance when due (whether at the
stated maturity, by acceleration or otherwise) of all present and future
obligations and liabilities of all kinds of Pledgor to the Secured Party which
arise under, out of, or in connection with the Note or this Pledge and Security
Agreement (collectively referred to as the "Obligations"), a security interest
in the following described property (collectively referred to as the
"Collateral"):
(a) 135,428 shares of the common stock of The Xxxxxxx Xxxxx Group, Inc.
and any other shares of such common stock from time to time delivered to the
Secured Party by the Pledgor to be held pursuant to this Agreement (together,
the "Shares"), all of the certificates representing or evidencing such Shares,
any interest therein and any other property at any time and from time to time
received, receivable or otherwise distributed or distributable in the future in
respect of or in exchange for such Shares;
together with
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(b) their Proceeds and all collateral security and guarantees given by
any person with respect to the foregoing, whether now or hereafter owned by the
Pledgor or in which the Pledgor now has or at any time in the future may acquire
any interest.
The Pledgor hereby agrees irrevocably and unconditionally to deliver to
the Secured Party 135,428 Shares as soon after the closing of the initial public
offering of shares of common stock of The Xxxxxxx Sachs Group, Inc. as such
shares become legally available to be pledged hereunder, but in any event no
later than six months after the closing of such initial public offering,
whereupon the security interest in favor of the Secured Party shall attach and
be perfected.
The Pledgor agrees that within two business days after receipt of
notice from the Secured Party that the fair market value of the Shares is less
than 150% of the principal plus accrued interest outstanding under the Note to
deliver additional Shares to be held pursuant to this Pledge and Security
Agreement so that after giving effect to the pledge of such Shares, the fair
market value of the pledged Shares shall be not less than 150% of the principal
plus accrued interest outstanding under the Note.
2. Delivery of Collateral.
All certificates and cash representing or evidencing the Collateral
shall be accompanied by duly executed instruments of transfer or assignments in
blank, with signatures appropriately guaranteed, shall be in a form and manner
sufficient to create a perfected first priority security interest therein in
favor of the Secured Party and otherwise shall be in form and substance
satisfactory to the Secured Party and shall be delivered to, or otherwise come
under the Control, as defined in Section 9-115(1)(e) of the NYUCC, of, the
Secured Party or held by a Securities Intermediary for the benefit of the
Secured Party.
3. Covenants and Agreements of Pledgor.
Pledgor covenants and agrees that:
(a) Pledgor will not enter into or execute any security agreement or
any financing statement covering the Collateral, other than financing statements
in favor of the Secured Party hereunder, and Pledgor will not consent to the
filing in any public office of any financing statement or statements (or any
documents or papers filed as such) covering the Collateral, other than financing
statements in favor of the Secured Party hereunder; and
(b) Pledgor authorizes the Secured Party to file, in its discretion, in
jurisdictions where this authorization will be given effect, a financing
statement signed only
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by the Secured Party covering the Collateral, and hereby appoints the Secured
Party as the Pledgor's attorney-in-fact to sign and file any such financing
statements covering the Collateral. At the request of the Secured Party, the
Pledgor will join the Secured Party in executing such documents as the Secured
Party may determine from time to time to be necessary or desirable under
provisions of any applicable Uniform Commercial Code in effect where the
Collateral is located or where the Pledgor conducts business; without limiting
the generality of the foregoing, the Pledgor agrees to join the Secured Party,
at the Secured Party's request, in executing one or more financing statements in
form satisfactory to the Secured Party. In connection with the foregoing, it is
agreed and understood between the parties hereto (and the Secured Party is
hereby authorized to carry out and implement this agreement and understanding)
that the Secured Party may, at any time or times, file as a financing statement
any counterpart, copy or reproduction of this Pledge and Security Agreement.
4. Rights of the Secured Party Related to Collateral.
(a) The Secured Party may from time to time:
(i) transfer, or cause to be transferred, any of the
Collateral into the name of the Secured Party or its nominee;
(ii) notify parties obligated on any of the Collateral to make
payment to the Secured Party of any amounts due or to become due
thereunder;
(iii) enforce collection of any of the Collateral by suit or
otherwise; surrender, release or exchange all or any part thereof, or
compromise or extend or renew for any period (whether or not longer
than the original period) any obligation of any nature of any party
with respect thereto; close any position and settle any contract; and
exercise any and all rights of conversion, exchange, subscription and
any other rights of Pledgor in any of the Collateral, except as
hereinafter provided with respect to income from or interest or
distributions on the Collateral; or
(iv) take possession or control of any proceeds of the
Collateral and apply the same to the satisfaction of the Obligations;
All without liability, except to account for any property actually
received by it; provided, however, that the Secured Party shall be under no duty
to exercise or perform, as the case may be, any of the foregoing.
(b) All cash distributions on the Collateral prior to the occurrence of
an Event of Default (as defined in the Note) shall be paid to the Pledgor, and
after an Event
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of Default all such amounts and all other income from or interest or other
distributions on the related Collateral shall be treated in accordance with
Section 6(b), and if Pledgor receives any such income or interest or other
distributions, the same shall be held by Pledgor in trust for the Secured Party
in the same medium in which received, shall not be commingled with any other
assets of Pledgor and shall be delivered to the Secured Party as Collateral in
accordance with the provisions of this Pledge and Security Agreement in the form
received, properly endorsed to permit collection, not later than the next
business day following the day of its receipt.
5. Further Assurances; Secured Party as Agent.
Pledgor agrees to take such actions and to execute such stock or bond
powers and such other or different writings as the Secured Party may request
(and irrevocably authorizes the Secured Party to execute such writings as
Pledgor's agent and attorney-in-fact) further to perfect, confirm and assure the
Secured Party's perfected first priority security interest in the Collateral and
to assist the Secured Party's realization thereon including, without limitation,
the right to receive, indorse, and collect all instruments made payable to the
Pledgor representing any dividend, interest payment or other distribution in
respect of the Collateral or any part thereof.
6. Rights and Remedies of the Secured Party Upon Default.
Following the occurrence and during the continuance of an Event of
Default (as defined in the Note) (a "Default"):
(a) the Secured Party shall have and, to the extent permitted by law,
may exercise any and all of the rights and remedies of a secured party under the
NYUCC, and as otherwise granted herein or under any other applicable law or
under any other agreement now or hereafter in effect executed by Pledgor,
including, without limitation, the right and power to sell, at public or private
sale or sales, or otherwise dispose of, or otherwise utilize the related
Collateral and any part or parts thereof in any manner authorized or permitted
under the NYUCC after default by a debtor, and to apply the proceeds thereof
toward satisfaction of any costs and expenses and attorneys' fees and expenses
thereby incurred by the Secured Party and toward satisfaction of the related
Obligations in such order or manner as the Secured Party may elect. Specifically
and without limiting the foregoing, the Secured Party shall have the right to
take possession of all or any part of the Collateral or any security therefor
and of all books, records, papers and documents of Pledgor or in Pledgor's
possession or control relating to the Collateral. To the extent permitted by
law, and except as expressly provided herein, Pledgor expressly waives any
notice of sale or other disposition of the related Collateral and all other
rights or remedies of Pledgor or formalities prescribed by law relative to sale
or disposition of the related Collateral or exercise of any other right or
remedy of the
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Secured Party existing after default hereunder; and to the extent any such
notice is required and cannot be waived, Pledgor agrees that if such notice is
given in the manner provided in Section 8 hereof at least two (2) days before
the time of the sale or disposition, such notice shall be deemed reasonable and
shall fully satisfy any requirement for giving of said notice;
(b) all dividends, payments of interest and other distributions of
every character made upon or in respect of the Collateral or any part thereof
shall be paid directly to and shall be held by the Secured Party as Collateral
pledged under and subject to this Pledge and Security Agreement; and
(c) all rights to marshaling of assets of Pledgor are hereby waived by
Pledgor.
7. Absolute Interest.
(a) All rights of the Secured Party hereunder, and all obligations of
the Pledgor hereunder, shall be absolute and unconditional irrespective of (i)
any change in the time, manner or place of payment of or in any other term of,
all or any of the Obligations, or any other amendment or waiver of or any
consent to any departure from the Note or any other agreement or instrument to
which Pledgor is or may be a party, (iii) any exchange, release or nonperfection
of any Collateral, or any release or amendment or waiver of or any consent to or
departure from any guarantee, for all or any of the Obligations or (iv) any
other circumstance which might constitute a defense available to, or a discharge
of, the Pledgor in respect of the Obligations or this Pledge and Security
Agreement.
(b) This Pledge and Security Agreement shall not be construed as
relieving Pledgor from full liability on the Obligations and any and all future
and other indebtedness secured hereby and for any deficiency thereon.
(c) All powers, authorizations and agencies herein contained with
respect to the Collateral are irrevocable and coupled with an interest.
8. Notices.
Any communication, notice or demand to be given to any party hereunder
shall be duly given if delivered or mailed by certified or registered mail to
such party at its address set forth on the signature page hereof, or such other
address as shall be designated by such party hereto to the other party hereto in
a written notice delivered in accordance with the terms hereof.
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9. No Waiver; Cumulative Rights.
No failure on the part of the Secured Party to exercise, and no delay
in exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by the Secured Party of any
right, remedy or power hereunder preclude any other or future exercise of any
other right, remedy or power. Each and every right, remedy and power hereby
granted to the Secured Party or allowed it by law or other agreement shall be
cumulative and not exclusive of any other, and may be exercised by the Secured
Party from time to time.
10. Governing Law.
This Pledge and Security Agreement shall be governed by, and
constituted in accordance with, the laws of the State of New York applicable to
contracts made or to be enforced in such State.
11. Consent to Jurisdiction.
Any judicial proceeding with respect to this Pledge and Security
Agreement may be brought by either party hereto in any court of competent
jurisdiction in the City of New York, and, by its execution and delivery of this
Pledge and Security Agreement, each party (a) accepts, generally and
unconditionally, the jurisdiction of such courts and irrevocably agrees to be
bound by any judgment rendered thereby and (b) irrevocably waives any objection
it may now or hereafter have as to the venue of any suit, action or proceeding
brought in such a court or that such a court is an inconvenient forum.
Each party consents that service of process upon it may be made by
certified or registered mail, return receipt requested, at its address specified
or determined in accordance with the provisions of Section 8. The Pledgor hereby
appoints CT Corporation System at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to
act as Pledgor's agent to receive, accept and acknowledge for and on Pledgor's
behalf, service of any and all legal processes, summons, notices and documents
which may be served in any such action or proceeding. Nothing herein shall
affect the right of either party to serve process in any other manner permitted
by law or shall limit the right of either party to bring proceedings against the
other party in the courts of any other jurisdiction.
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13. Execution in Counterparts.
This Pledge and Security Agreement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Pledge and Security
Agreement to be duly executed as of the date first above written.
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XXXXXXXX XXXXXXX
Address: Xxxxxxx Xxxxx 000
00000, Xxxxxxxxxxxx
Minato-ku, Tokyo 000
Xxxxx
THE XXXXXXX SACHS GROUP, L.P.
By:
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Name:
Title:
Address: 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx, 00000
Attn.: Xxxx Xxxxxx
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