Exhibit 10.4
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (the "Agreement") is entered into effective
April 13, 2007, by and between BlueWater Capital Group, LLC, a Delaware limited
liability company ("Pledgor"), and Calibre Energy, Inc., a Nevada corporation
(the "Secured Party").
WHEREAS, Pledgor owns shares of the Series A Convertible Preferred
Stock of the Secured Party (the "Preferred Stock");
WHEREAS, the Pledgor is indebted to the Secured Party in the amount of
$4,000,000 pursuant to that certain promissory note (the "Note") dated the date
hereof and payable by Pledgor to the order of Secured Party; and
WHEREAS, to induce the Secured Party to grant or continue the extension
of credit and other financial accommodations provided to the Pledgor by the
Secured Party, Pledgor desires to pledge, grant, transfer and assign to the
Secured Party a security interest in the Collateral as security for the
obligation (as hereinafter defined).
ARTICLE I.
SECURITY INTEREST AND PLEDGE
Section 1.01. Security Interest and Pledge. Pledgor hereby pledges,
grants, and delivers to the Secured Party a first priority security interest in
all of the right, title, and interest of the Pledgor in and to 6,400,000 shares
of the Preferred Stock, and all products and proceeds thereof, including,
without limitation, all revenues, distributions, dividends, stock dividends,
securities, and other property rights and interests that Pledgor is at any time
entitled to receive on account of the same including but not limited to any
shares of common stock of Secured Party issued upon the conversion of the shares
of Preferred Stock (the "Collateral"). Pledgor has delivered to Secured Party
physical custody of the certificates evidencing the Collateral.
Section 1.02. Obligations. The Collateral shall secure the repayment by
the Pledgor of the obligations and indebtedness evidenced by the Note and all
obligations of Pledgor pursuant to that certain Investment Agreement dated the
date hereof and all extension, renewals, and modifications of any of the
foregoing (collectively, the "Obligations").
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Pledgor represents and warrants to the Secured Party that:
Section 2.01. Title. Pledgor owns, and with respect to Collateral
acquired after the date hereof, Pledgor will own, legally and beneficially, the
Collateral free and clear of any lien, security interest, pledge, claim, or
other encumbrance or any right or option on the part of any third person to
purchase or otherwise acquire the Collateral or any part thereof, except for the
security interest granted hereunder. The Collateral is not subject to any
restriction on transfer or assignment except pursuant to the applicable federal
and state securities laws and regulations promulgated thereunder. Pledgor has
the unrestricted right to pledge the Collateral as contemplated hereby. All of
the Collateral has been duly and validly issued and is fully paid and
nonassessable.
Section 2.02. First Priority Perfected Security Interest. This
Agreement creates in favor of the Secured Party a security interest in the
Collateral which security interest will be a perfected first priority security
interest so long as the Secured Party retains possession of the Collateral.
ARTICLE III.
AFFIRMATIVE AND NEGATIVE COVENANTS
Pledgor covenants and agrees with the Secured Party that until the
Obligations are satisfied and performed in full:
Section 3.01. Encumbrances. Pledgor shall not create, permit, or suffer
to exist, and shall defend the Collateral against, any lien, security interest,
or other encumbrances on the Collateral except the pledge and security interest
of the Secured Party hereunder, and shall defend Pledgor's rights in the
Collateral and the Secured Party's security interest in the Collateral against
the claims of all persons and entities.
Section 3.02. Sale of Collateral. Pledgor shall not sell, assign, or
otherwise dispose of the Collateral or any part thereof without the prior
written consent of the Secured Party.
Section 3.03. Distributions. If Pledgor shall become entitled to
receive or shall receive any stock certificate (including, without limitation,
any certificate representing a stock dividend or a distribution in connection
with any reclassification, increase, or reduction of capital or issued in
connection with any reorganization), option or rights, whether as an addition
to, in substitution of, or in exchange for any Collateral or otherwise, Pledgor
agrees to accept the same as the Secured Party's agent and to hold the same in
trust for the Secured Party, and to deliver the same forthwith to the Secured
Party in the exact form received, with the appropriate endorsement of Pledgor
when necessary and/or appropriate undated stock powers duly execute in blank, to
be held by the Secured Party as additional Collateral for the Obligations,
subject to the terms hereof. Any sums paid upon or in respect of the Collateral
upon the liquidation or dissolution of the issuer thereof shall be paid over to
the Secured Party to be held by it as additional Collateral for the Obligations
subject to the terms hereof; and in case any distribution of capital shall be
made on or in respect of the Collateral or any property shall be distributed
upon or with respect to the Collateral pursuant to any recapitalization or
reclassification of the capital of the issuer thereof or pursuant to any
reorganization of the issuer thereof, the property so distributed shall be
delivered to the Secured Party to be held by him, as additional Collateral for
the Obligations, subject to the terms hereof. All sums of money and property so
paid or distributed in respect of the Collateral that are received by Pledgor
shall, until paid or delivered to the Secured Party, be held by Pledgor in trust
as additional security for the Obligations.
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Section 3.04. Further Assurances. At any time and from time to time,
upon the request of the Secured Party, and at the sole expense of Pledgor,
Pledgor shall promptly execute and deliver all such further instruments and
documents and take such further action as the Secured Party may deem necessary
or desirable to preserve and perfect their security interest in the Collateral
and carry out the provisions and purposes of this Agreement, including, without
limitation, the execution and filing of such financing statements as the Secured
Party may require. A carbon, photographic, or other reproduction of this
Agreement or of any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement and may be filed as a
financing statement.
Section 3.05. Obligations. Pledgor shall duly and punctually pay and
perform the Obligations.
ARTICLE IV.
RIGHTS OF SECURED PARTY AND PLEDGOR
Section 4.01. Power of Attorney. Pledgor hereby irrevocably constitutes
and appoints the Secured Party and any officer or agent thereof, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead and in the name of Pledgor or in its
own name, from time to time in the Secured Party' s discretion, to take any and
all action and to execute any and all documents and instruments which may be
necessary or desirable to accomplish the purposes of this Agreement and, without
limiting the generality of the foregoing, hereby gives the Secured Party the
power and right on behalf of Pledgor and in its own name to do any of the
following, without notice to or the consent of Pledgor:
(i) to demand, xxx for, collect, or receive in the name of
Pledgor or in its own name, any money or property at any time payable
or receivable on account of or in exchange for any of the Collateral
and, in connection therewith, endorse checks, notes, drafts,
acceptances, money orders, or any other instruments for the payment of
money under the Collateral;
(ii) to pay or discharge taxes, liens, security interests, or
other encumbrances levied or placed on or threatened against the
Collateral;
(iii) (A) to direct any parties liable for any payment under
any of the Collateral to make payment of any and all monies due and to
become due thereunder directly to the Secured Party or as the Secured
Party shall direct; (B) to receive payment of and receipt for any and
all monies, claims, and other amounts due and to become due at any time
in respect of or arising out of any Collateral; (C) to sign and endorse
any drafts, assignments, proxies, stock powers verifications, notices,
and other documents relating to the Collateral; (D) to commence and
prosecute any suit, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect the Collateral or any part
thereof and to enforce any other right in respect of any Collateral;
(E) to defend any suit, action, or proceeding brought against Pledgor
with respect to any Collateral; (F) to settle, compromise, or adjust
any suit, action, or proceeding described above and, in connection
therewith, to give such discharges or releases as the Secured Party may
deem appropriate; (G) to exchange any of the Collateral for other
property upon any merger, consolidation, reorganization,
recapitalization, or other readjustment of the issuer thereof and, in
connection therewith, deposit any of the Collateral with any committee,
depositary, transfer agent, registrar, or other designated agency upon
such terms as the Secured Party may determine; (H) to add or release
any guarantor, endorser, surety, or other party to any of the
Collateral or other Obligations; (I) to renew, extend, or otherwise
change the terms and conditions of any of the Collateral or
Obligations; (J) to sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and
completely as though the Secured Party were the absolute owner thereof
for all purposes, and to do, at the Secured Party's option and
Pledgor's expense, at any time, or from time to time, all acts and
things which the Secured Party deems necessary to protect, preserve, or
realize upon the Collateral and the Secured Party's security interest
therein; and (K) to complete, execute and file with the SEC one or more
notices of proposed sale of securities pursuant to Rule 144.
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This power of attorney is a power coupled with an interest and shall be
irrevocable; provided, however, the power of attorney granted herein shall not
be exercisable by the Secured Party until the occurrence and during the
continuance of an Event of Default (as hereinafter defined). The Secured Party
shall be under no duty to exercise or withhold the exercise of any of the
rights, powers, privileges, and options expressly or implicitly granted to the
Secured Party in this Agreement, and shall not be liable for any failure to do
so or any delay in doing so. The Secured Party shall not be liable for any act
or omission or for any error of judgment or any mistake of fact or law in its
individual capacity or in its capacity as attorney-in-fact except acts or
omissions resulting from its willful misconduct. This power of attorney is
conferred on the Secured Party solely to protect preserve, and realize upon
their security interest in the Collateral.
Section 4.02. Voting Rights. So long as no Event of Default shall have
occurred and be continuing, Pledgor shall be entitled to exercise any and all
voting rights relating or pertaining to the Collateral or any part thereof.
Section 4.03. Performance by the Secured Party of Pledgor's
Obligations. If Pledgor failed to perform or comply with any of its agreements
contained herein and the Secured Party shall cause performance of or compliance
with such agreement, the reasonable expenses of the Secured Party, together with
interest thereon at the maximum nonusurious per annum rate permitted by
applicable law, shall be payable by Pledgor to the Secured Party on demand and
shall constitute Obligations secured by this Agreement.
Section 4.04. Secured Party's Duty of Care. Other than the exercise of
reasonable care in the physical custody of the Collateral while held by the
Secured Party hereunder, the Secured Party shall have no responsibility for or
obligation or duty with respect to all or any part of the Collateral or any
matter or proceeding arising out of or relating thereto, including, without
limitation, any obligation or duty to collect any sums due in respect thereof or
to protect or preserve any rights against prior parties or any other rights
pertaining thereto, it being understood and agreed that Pledgor shall be
responsible for preservation of all rights in the Collateral. Without limiting
the generality of the foregoing, the Secured Party takes such action, for
purposes of preserving rights in the Collateral, as Pledgor may reasonably
request in writing, but no failure or omission or delay by the Secured Party in
complying with any such request by Pledgor, shall be deemed to be a failure to
exercise reasonable care.
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ARTICLE V.
DEFAULT
Section 5.01. Events of Default. Each of the following shall be deemed
an "Event of Default" under this Agreement:
(a) The Obligations or any part thereof shall fail to have
been paid when due;
(b) Breach of this Agreement; or
(c) An Event of Default shall have occurred under the Note.
Section 5.02. Rights and Remedies. Upon the occurrence of an Event of
Default, the Secured Party shall have the following rights and remedies:
(i) The Secured Party may declare the Obligations or any part
thereof immediately due and payable, without notice, demand,
presentment, notice of dishonor, notice of acceleration, notice of
intent to accelerate, notice of intent to demand, protest, or other
formalities of any kind, all of which are hereby expressly waived by
Pledgor.
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(ii) In addition to all other rights and remedies granted to
the Secured Party in this Agreement and in any other instrument or
agreement securing, evidencing, or relating to the Obligations, the
Secured Party shall have all of the rights and remedies of a secured
party under the Uniform Commercial Code as adopted by the state of
Nevada. Without limiting the generality of the foregoing, the Secured
Party may: (A) without demand or notice to Pledgor, collect, receive,
or take possession of the Collateral or any part thereof, (B) sell or
otherwise dispose of the Collateral, or any part thereof, in one or
more parcels at public or private sale or sales, at the Secured Party's
offices or elsewhere, for cash, on credit, or for future delivery,
and/or, (C) bid and become a purchaser at any sale free of any right or
equity of redemption in Pledgor, which right or equity is hereby
expressly waived and releases by Pledgor. Upon the request of the
Secured Party at any place designated by the Secured Party that is
reasonably convenient to Pledgor and the Secured Party. Pledgor agrees
that the Secured Party shall not be obligated to give more than 10 days
written notice of the time and place of any public sale or of the time
after which any private sale may take place and that such notice shall
constitute reasonable notice of such matters. Pledgor shall be liable
for all expenses of retaking, holding, preparing for sale, or the like,
and all reasonable attorneys' fees and other reasonable expenses
incurred by the Secured Party in connection with the collection of the
Obligations and the enforcement of the Secured Party' rights under this
Agreement, all of which expenses and fees shall constitute additional
Obligations secured by this Agreement. the Secured Party may apply the
Collateral against the Obligations in such order and manner as the
Secured Party may elect in its sole discretion. Pledgor shall remain
liable for any deficiency if the proceeds of any sale or disposition of
the Collateral are insufficient to pay the Obligations. Pledgor waives
all rights of marshalling in respect of the Collateral.
(iii) The Secured Party may cause any or all of the Collateral
held by it to be transferred into the name of the Secured Party or the
name or names of the Secured Party's nominee or nominees.
(iv) The Secured Party shall be entitled to receive all cash
and other dividends payable in respect of the Collateral.
(v) The Secured Party shall have the right, but shall not be
obligated to, exercise or cause to be exercised all voting rights and
corporate powers in respect of the Collateral, and Pledgor shall
deliver to the Secured Party, if requested by the Secured Party,
irrevocable proxies with respect to the Collateral in form satisfactory
to the Secured Party.
(vi) Pledgor hereby acknowledges and confirms that the Secured
Party may be unable to effect a public sale of any or all of the
Collateral by reason of certain prohibitions contained in the
Securities Act of 1933, as amended, and applicable state securities
laws and may be compelled to resort to one or more private sales
thereof to a restricted group of purchasers who will be obligated to
agree, among other things, to acquire any shares of the Collateral for
their own respective accounts for investment and not with a view to
distribution or resale thereof. Pledgor further acknowledges and
confirms that any such private sale may result in prices or other terms
less favorable to the seller than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner,
and the Secured Party shall be under no obligation to take any steps in
order to permit the Collateral to be sold at a public sale. The Secured
Party shall be under no obligation to delay a sale or any of the
Collateral for any period of time necessary to permit any issuer
thereof to register such Collateral for public sale under the
Securities Act of 1933, as amended, or under applicable state
securities laws, but Pledgor shall not be liable in any respect for the
Secured Party's failure to do so.
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(vii) If the Secured Party determines that it will sell all or
part of the Collateral pursuant to Section 5.02 hereof, and if, in the
opinion of the Secured Party it is necessary or advisable to have the
Collateral, or that portion thereof to be sold, registered under the
Securities Act of 1933, as amended, Pledgor will take all good faith
efforts, at Pledgor's expense, to cause each issuer of the Collateral,
or that portion thereof to be sold, to execute and deliver, and cause
such issuer(s), directors, and officers to do or cause to be done all
such other acts and things as may be necessary or, in the Secured
Party's opinion, advisable to register the Collateral, or that portion
thereof, to be sold, under the Securities Act of 1933, as amended, and
to cause the registration statement relating thereto to become
effective and to remain effective for a period of one year from the
date of the first public offering of the Collateral, or that portion
thereof to be sold, and to make all amendments thereto and to the
related prospectus that, in the Secured Party's opinion, are necessary
or advisable, all in conformity with the requirements of the Securities
Act of 1933, as amended, and the rules and regulations of the SEC
applicable thereto. Pledgor agrees to take all good faith efforts to
cause each issuer of the Collateral, or that portion thereof to be
sold, to comply with Securities Act of 1933, as amended, and the blue
sky laws of any jurisdiction that the Secured Party shall designate and
take all good faith efforts to cause each such issuer to make available
to its security holders, as soon as practical, an earnings statement
(which need not be audited) that will satisfy the provisions of the
Securities Act of 1933, as amended.
(viii) On any sale of the Collateral, the Secured Party is
hereby authorized to comply with any limitation or restriction with
which compliance is necessary, in the view of the Secured Party's
counsel, in order to avoid any violation of applicable law or in order
to obtain any required approval of the purchaser or purchasers by any
applicable governmental authority.
ARTICLE VI.
MISCELLANEOUS
Section 6.01. No Waiver; Cumulative Remedies. No failure on the part of
the Secured Party to exercise and no delay in exercising, and no course of
dealing with respect to, any right, power, or privilege under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power, or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, power, or
privilege. The rights and remedies provided for in this Agreement are cumulative
and not exclusive of any rights and remedies provided by law.
Section 6.02. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the Pledgor and the Secured Party and their
respective heirs, successors, and assigns, except that Pledgor may not assign
any of its rights or obligations under this Agreement without the prior written
consent of the Secured Party.
Section 6.03. Amendment. The provisions of this Agreement may be
amended or waived only by an instrument in writing signed by the parties hereof.
Section 6.04. Notices: Any notice, consent, or other communication
required or permitted to be given under this Agreement to the Secured Party or
Pledgor must be in writing and delivered in person or mailed by registered or
certified mail, return receipt requested, postage prepaid, as follows:
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To Secured Party: 0000 X Xxxxxx XX, Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
To Pledgor: X.X. Xxx 00000
Xxxxxxx, XX 00000-0000
Any such notice, consent, or other communication shall be deemed given
when delivered in person or, if mailed, three days after it is duly deposited in
the mail.
Section 6.05. APPLICABLE LAW AND VENUE. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEVADA,
AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT HAS BEEN
ENTERED INTO IN XXXXXX CITY COUNTY, NEVADA, AND IT SHALL BE PERFORMABLE FOR ALL
PURPOSES IN XXXXXX CITY COUNTY, NEVADA. ANY ACTION OR PROCEEDING AGAINST PLEDGOR
UNDER OR IN CONNECTION WITH THIS AGREEMENT MAY BE BROUGHT IN ANY STATE OR
FEDERAL COURT LOCATED IN XXXXXX CITY COUNTY, NEVADA. ANY ACTION OR PROCEEDING BY
PLEDGOR AGAINST THE SECURED PARTY SHALL BE BROUGHT ONLY IN ANY STATE OR FEDERAL
COURT LOCATED IN XXXXXX CITY COUNTY, NEVADA.
Section 6.06. Headings. The headings, captions, and arrangements used
in this Agreement are for convenience only and shall not affect the
interpretation of this Agreement.
Section 6.07. Survival of Representations and Warranties. All
representations and warranties made in this Agreement or in any certificate
delivered pursuant hereto shall survive the execution and delivery of this
Agreement, and no investigation by the Secured Party shall affect the
representations and warranties or the right of the Secured Party to rely upon
them.
Section 6.08. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Section 6.09. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
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Section 6.10. Construction. Pledgor and the Secured Party acknowledge
that each of them had the benefit of legal counsel of its own choice and has
been afforded an opportunity to review this Agreement with its legal counsel and
that this Agreement shall be construed as if jointly drafted by Pledgor and the
Secured Party.
Section 6.11. Obligations Absolute. The obligations of Pledgor under
this Agreement shall be absolute and unconditional and shall not be released,
discharged, reduced, or in any way impaired by any circumstances whatsoever,
including, without limitation, any amendment, modification, extension, or
renewal of this Agreement, the Obligations, or any document or instrument
evidencing, securing, or otherwise relating to the Obligations, or any release,
subordination, or impairment of Collateral, or any waiver, consent, extension,
indulgence, compromise, settlement, or other action or inaction in respect of
this Agreement, the Obligations, or any document or instrument evidencing,
securing or otherwise relating to the Obligations, or any exercise or failure to
exercise any right, remedy, power, or privilege in respect of the Obligations.
Section 6.12. Partial Release. Secured Party shall upon the request of
Pledgor from time to time release from this Stock Pledge Agreement and the liens
granted hereunder a percentage of the Collateral equivalent to the percentage of
the principal balance of the Note which has been paid by Pledgor as of the date
of such request.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first written above.
PLEDGOR:
BLUEWATER CAPITAL GROUP, LLC, a Delaware
limited liability company
By: The Xxxxxxxx Trust, its Manager
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Name:
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Title:
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SECURED PARTY:
CALIBRE ENERGY, INC., a Nevada corporation
By:
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Name:
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Title:
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