Exhibit 4.5
STOCK PLEDGE AGREEMENT
This PLEDGE AGREEMENT, dated as of March 11, 2003, between Integrated
Security Systems, Inc., a Delaware corporation ("Pledgor" or "Borrower"), HSBC
Global Custody Nominee (U.K.) Limited, Designation No. 896414, for the benefit
of BFS US Special Opportunities Trust PLC, a public limited company registered
in England and Wales ("BFS US") (hereinafter referred to as "Secured Party" or
"Lender"), and Renaissance Capital Group, Inc., a Texas corporation, as Agent
for the Lender (the "Agent").
RECITALS
A. Lender has lent to Borrower the aggregate principal amount of
Two Hundred Fifty Thousand Dollars ($250,000) evidenced by the
Borrower's promissory note of even date herewith (the "Note").
B. Pledgor is the owner of the shares of capital stock issued by
each subsidiary ("Subsidiary") named on Schedule A, and Pledgor has
agreed to pledge and assign to Secured Party a security interest in such
shares, together with any additional shares of capital stock of a
Subsidiary or of any subsidiary of Pledgor subsequently issued or
acquired by Pledgor (collectively, the "Shares"), to secure payment of
the Note of Pledgor and all other indebtedness of Pledgor to Secured
Party (collectively, the "Obligations").
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants, the parties agree as follows:
1. Pledge of Shares. Pledgor hereby pledges and assigns to the
Secured Party the Shares for the purpose of securing the full and prompt
payment, when due, by Pledgor of the Obligations.
2. Perfection of Pledge. Upon execution of this Pledge, Pledgor
shall execute and deliver to Secured Party a financing statement relating to the
Shares.
3. Voting of Shares and Receipt of Dividends. Pledgor shall have
the right to vote the Shares and to receive dividends and distributions on the
shares, except upon the occurrence of a default in the full and prompt payment
of the Obligations, when due (a "Default"), in which event Secured Party shall
have such rights.
4. Representations and Warranties. Pledgor hereby warrants,
represents, and covenants as follows:
a. Pledgor owns the Shares, free from any pledges, security
interests, adverse claims, or liens, except for pledge and security
interest granted to Renaissance Capital Growth & Income Fund III, Inc.,
and Renaissance US Growth Investment Trust PLC;
b. Pledgor will notify Secured Party of, and will defend the
Shares against, all claims and demands of all persons at any time
claiming the Shares or any interest therein;
c. Pledgor will pay all taxes and assessments upon the
Shares prior to the date of delinquency for payment of such taxes and
assessments;
d. Pledgor has the full power, authority and capacity to
grant the security interest hereunder; and
e. The Subsidiaries are the only operating subsidiaries of
the Pledgor, and the number of shares set forth on Schedule A constitute
all of the outstanding capital stock of the Subsidiaries.
5. Return of Security. When the Obligations have been paid in full,
Agent shall promptly deliver the certificates representing the Shares then held
by it and all related stock powers to Pledgor.
6. Occurrence of a Default. If a Default occurs, Agent or Secured
Party shall have the right to exercise any rights and remedies provided under
the Uniform Commercial Code of Texas or any other applicable law with respect to
the Shares.
7. Duration of Pledge. This Pledge shall be terminated upon the
earlier of: (i) foreclosure by Secured Party of the security interest granted
hereunder upon the occurrence of a Default, or (ii) return of the Shares to
Pledgor upon payment of the Obligations.
8. Miscellaneous.
a. Governing Law. This Pledge shall be governed by and
construed and enforced in accordance with the substantive laws of the
State of Texas, without regard to the conflicts of laws provisions
thereof, and the applicable laws of the United States. Venue and
jurisdiction shall be in the state or federal courts in Dallas County,
Texas.
b. Binding Effect. All of the terms, covenants,
representations, warranties and conditions herein shall be binding upon,
and inure to the benefit of, and be enforceable by the parties and their
respective successors and assignees.
c. Waiver. This Pledge may not be amended, modified,
superseded or canceled, nor may any of the terms, covenants,
representations, warranties or conditions hereof be waived, except by a
written instrument executed by the party against whom such amendment,
modification, supersedure, cancellation or waiver is charged. The
failure of any party at any time or times to require performance of any
provision hereof shall in no manner affect the right at a later time to
enforce the same. No waiver by any party of any condition, or of any
breach of any term, covenant, representation or warranty contained
herein, in any one or more instances, shall be deemed to be or construed
as a further or continuing waiver of any such condition or breach or
waiver of any other condition or of any breach of any other term,
covenant, representation or warranty.
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d. Attorneys' Fees. If any party brings an action in
connection with the performance, breach or interpretation of this
Pledge, or in any action related to the transaction contemplated hereby,
the prevailing party in such action shall be entitled to recover from
the losing party in such action all reasonable costs and expenses of
such litigation, including attorneys' fees, court costs, costs of
investigation, accounting and other costs reasonably incurred or related
to such litigation.
e. Severability. If any provision hereof is determined to be
illegal or unenforceable, such determination shall not affect the
validity or enforceability of the remaining provisions hereof, all of
which shall remain in full force and effect.
f. Further Documents. Each party covenants and agrees that,
from time to time, after the date hereof, at the reasonable request of
any other party, and without further consideration, such party will
execute and deliver such other documents and take such other action
reasonably required to carry out, in all respects, the transactions
contemplated and intended by this Pledge.
g. Notices. Any notices or other communications required or
permitted to be given by this Agreement or any other documents and
instruments referred to herein must be (i) given in writing and
personally delivered, mailed by prepaid certified or registered mail or
sent by overnight service, such as FedEx, or (ii) made by telex or
facsimile transmission delivered or transmitted to the party to whom
such notice or communication is directed, with confirmation thereupon
given in writing and personally delivered or mailed by prepaid certified
or registered mail.
If to Pledgor:
Integrated Security Systems, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxx X. Xxxx, Esq.
Xxxxxx and Xxxxx, LLP
0000 X. Xxxxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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If to Secured Party:
BFS US Special Opportunities Trust PLC
c/o Renaissance Capital Group, Inc.
0000 Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxx 000-XX00
Xxxxxx, Xxxxx 00000
Attn.: Xxxxxxx Xxxxxxxxx
President and Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
Xxxxxxxxxxx & Xxxxxxxx LLP
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Agent:
Renaissance Capital Group, Inc.
0000 Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxx 000-XX00
Xxxxxx, Xxxxx 00000
Attn.: Xxxxxxx Xxxxxxxxx
President and Chief Executive Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
Xxxxxxxxxxx & Xxxxxxxx LLP
0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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Any notice delivered personally in the manner provided herein will be
deemed given to the party to whom it is directed upon the party's (or its
agent's) actual receipt. Any notice addressed and mailed in the manner provided
herein will be deemed given to the party to whom it is addressed at the close of
business, local time of the recipient, on the fourth business day after the day
it is placed in the mail, or, if earlier, the time of actual receipt.
h. Parties in Interest. Nothing in this Pledge, whether
express or implied, is intended to confer any rights or remedies under
or by reason of this Pledge on any persons other than the parties and
the respective successors and assigns, nor is anything in this Pledge
intended to relieve or discharge the obligation or liability of any
third persons to any party to this Pledge, nor shall any provisions give
any third persons any right of subrogation or action over or against any
party to this Pledge.
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signature page follows.]
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IN WITNESS WHEREOF, this Pledge Agreement is executed as of the date
first above written.
PLEDGOR:
INTEGRATED SECURITY SYSTEMS, INC.
By: /S/ C. A. XXXXXXX, JR.
---------------------------
C. A. Xxxxxxx, Chairman and
Chief Executive Officer
SECURED PARTY:
BFS US SPECIAL OPPORTUNITIES TRUST PLC
By: /S/ XXXXXXX XXXXXXXXX
---------------------------
Xxxxxxx Xxxxxxxxx, Director
AGENT:
RENAISSANCE CAPITAL GROUP, INC.
By: /S/ XXXXXXX XXXXXXXXX
--------------------------------
Xxxxxxx Xxxxxxxxx, President and
Chief Executive Officer
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SCHEDULE A
Subsidiaries No. of Shares
---------------------- -------------
B&B Electormatic, Inc. 1,000
Intelli-Site, Inc. 1,000
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