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EXHIBIT 10.52
[LITIGATION]
EXECUTION COPY
(CODE ALARM)
PLEDGE AGREEMENT
This PLEDGE AGREEMENT, dated as of October 24, 1997 (together
with all amendments, if any, from time to time hereto, this "Agreement")
between CODE-ALARM, INC., a Michigan corporation (the "Pledgor") and GENERAL
ELECTRIC CAPITAL CORPORATION in its capacity as Agent for "Lenders," as defined
below ("Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Litigation L/C and Term Loan
C Agreement dated as of the date hereof by and among Pledgor (in such capacity,
the "Borrower"), Agent and the Persons signatory thereto from time to time as
Term Lenders (including all annexes, exhibits and schedules thereto, and as
from time to time amended, restated, supplemented or otherwise modified (the
"Credit Agreement"), such Term Lenders (collectively, the "Lenders") have
agreed to incur Litigation Obligations for the benefit of Borrower;
WHEREAS, Pledgor is the record and beneficial owner of the
shares of Stock listed in Schedule I hereto;
WHEREAS, in order to induce Agent and Lenders to incur
Litigation L/C Obligations and certain other Litigation Obligations, including
the obligations constituting Term Loan C, or to advance the Term Loan C, as
provided for in the Credit Agreement, Pledgor has agreed to pledge the Pledged
Collateral to Agent in accordance herewith;
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained and to induce Lenders to incur Obligations
under the Credit Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms
defined in the Credit Agreement are used herein as therein defined, and the
following shall have (unless otherwise provided elsewhere in this Agreement)
the following respective meanings (such meanings being equally applicable to
both the singular and plural form of the terms defined):
"Bankruptcy Code" means title 11, United States Code, as amended from
time to time, and any successor statute thereto.
"Pledged Collateral" has the meaning assigned to such term in Section
2 hereof.
"Pledged Entity" means an issuer of Pledged Stock.
"Pledged Shares" means those shares listed in Schedule I hereto.
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"Secured Obligations" has the meaning assigned to such term in Section
3 hereof.
2. Pledge. Pledgor hereby pledges to Agent, and grants
to Agent for itself and the benefit of Lenders, a continuing security interest
in all of the following, other than Permitted Encumbrances (collectively, the
"Pledged Collateral"):
(i) the Pledged Shares and the certificates representing
the Pledged Shares, and all dividends, distributions, cash,
instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for
any or all of the Pledged Shares; and
(ii) such portion, as determined by Agent as provided in
Section 6(d) below, of any additional shares of Stock of a Pledged
Entity from time to time acquired by Pledgor in any manner (which
shares shall be deemed to be part of the Pledged Shares), and
the certificates representing such additional shares, and all
dividends, distributions, cash, instruments and other property or
proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such Stock.
3. Security for Obligations. This Agreement secures,
and the Pledged Collateral is security for, the prompt payment in full when
due, whether at stated maturity, by acceleration or otherwise, and performance
of all Litigation Obligations of any kind under or in connection with the
Credit Agreement and the other Litigation Collateral Documents (hereinafter,
the "Loan Documents") and all obligations of Pledgor now or hereafter existing
under this Agreement including, without limitation, all fees, costs and
expenses whether in connection with collection actions hereunder or otherwise
(collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. All certificates
evidencing the Pledged Collateral shall be delivered to and held by or on
behalf of Agent, for itself and the benefit of Lenders, pursuant hereto. All
Pledged Shares shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to Agent.
5. Representations and Warranties. Pledgor represents
and warrants to Agent that on the Closing Date and, unless otherwise specified
below, as of each time Pledgor requests or accepts the proceeds of an Advance
or Loan under the Credit Agreement:
(a) Pledgor is, and at the time of delivery of the Pledged Shares
to Agent will be, the sole holder of record and the sole beneficial owner of
such Pledged Collateral pledged by Pledgor free and clear of any Lien thereon
or affecting the title thereto, except for Permitted Encumbrances or any Lien
created by this Agreement;
(b) All of the Pledged Shares have been duly authorized, validly
issued and are fully paid and non-assessable;
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(c) Pledgor has the right and requisite authority to pledge,
assign, transfer, deliver, deposit and set over the Pledged Collateral pledged
by Pledgor to Agent as provided herein;
(d) None of the Pledged Shares has been issued or transferred in
violation of the securities registration, securities disclosure or similar laws
of any jurisdiction to which such issuance or transfer may be subject;
(e) All of the Pledged Shares are presently owned by Pledgor, and
are presently represented by the certificates listed in Schedule I hereto. As
of the date hereof, there are no existing options, warrants, calls or
commitments of any character whatsoever relating to the Pledged Shares;
(f) No consent, approval, authorization or other order or other
action by, and no notice to or filing with, any Governmental Authority or any
other Person is required (i) for the pledge by Pledgor of the Pledged
Collateral pursuant to this Agreement or for the execution, delivery or
performance of this Agreement by Pledgor, or (ii) for the exercise by Agent of
the voting or other rights provided for in this Agreement or the remedies in
respect of the Pledged Collateral pursuant to this Agreement, except as may be
required in connection with such disposition by laws affecting the offering and
sale of securities generally;
(g) The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement will create a valid Lien on and a continuing
perfected security interest in favor of the Agent for the benefit of Agent and
Lenders in the Pledged Collateral and the proceeds thereof, securing the
payment of the Secured Obligations, subject to no other Lien (other than
Permitted Encumbrances and Liens created pursuant to the Litigation Collateral
Documents);
(h) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes a legal, valid and binding obligation of
Pledgor enforceable against Pledgor in accordance with its terms; and
(i) The Pledged Shares constitute 100% of the issued and
outstanding shares of Stock of each Pledged Entity.
The representations and warranties set forth in this Section 5
shall survive the execution and delivery of this Agreement.
6. Covenants. Pledgor covenants and agrees that until
the Termination Date:
(a) Without the prior written consent of Agent, Pledgor will not
sell, assign, transfer, pledge, or otherwise encumber any of its rights in or
to the Pledged Collateral, or any unpaid dividends, interest or other
distributions or payments with respect to the
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Pledged Collateral or xxxxx x Xxxx in the Pledged Collateral, unless otherwise
expressly permitted by the Credit Agreement;
(b) Pledgor will, at its expense, promptly execute, acknowledge
and deliver all such instruments and take all such actions as Agent from time
to time may request in order to ensure to Agent and Lenders the benefits of the
Liens in and to the Pledged Collateral intended to be created by this
Agreement, including the filing of any necessary Code financing statements,
which may be filed by Agent with or (to the extent permitted by law) without
the signature of Pledgor, and will cooperate with Agent, at Pledgor's expense,
in obtaining all necessary approvals and making all necessary filings under
federal, state, local or foreign law in connection with such Liens or any sale
or transfer of the Pledged Collateral;
(c) Pledgor has and will defend the title to the Pledged
Collateral and the Liens of Agent in the Pledged Collateral against the claim
of any Person and will maintain and preserve such Liens; and
(d) Pledgor will, upon obtaining ownership of any additional Stock
of a Pledged Entity or Stock otherwise required to be pledged to Agent pursuant
to any of the Loan Documents, which Stock is not already Pledged Collateral,
promptly (and in any event within three (3) Business Days) deliver to Agent a
Pledge Amendment, duly executed by Pledgor, in substantially the form of
Schedule II hereto (a "Pledge Amendment") in respect of any such additional
Stock, pursuant to which Pledgor shall pledge to Agent all of such additional
Stock. Pledgor hereby authorizes Agent to attach each Pledge Amendment to this
Agreement and agrees that all Pledged Shares listed on any Pledge Amendment
delivered to Agent shall for all purposes hereunder be considered Pledged
Collateral.
7. Pledgor's Rights. As long as no Default or Event of Default
shall have occurred and be continuing and until written notice shall be given
to Pledgor in accordance with Section 8(a) hereof:
(a) Pledgor shall have the right, from time to time, to vote and
give consents with respect to the Pledged Collateral, or any part thereof for
all purposes not inconsistent with the provisions of this Agreement, the Credit
Agreement or any other Loan Document; provided, however, that no vote shall be
cast, and no consent shall be given or action taken, which would have the
effect of impairing the position or interest of Agent in respect of the Pledged
Collateral or which would authorize, effect or consent to (unless and to the
extent expressly permitted by the Credit Agreement):
(i) the dissolution or liquidation, in whole or
in part, of a Pledged Entity;
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(ii) the consolidation or merger of a Pledged
Entity with any other Person;
(iii) the sale, disposition or encumbrance of all
or substantially all of the assets of a Pledged Entity, except
for Liens in favor of Agent;
(iv) any change in the authorized number of shares, the
stated capital or the authorized share capital of a Pledged Entity or
the issuance of any additional shares of its Stock; or
(v) the alteration of the voting rights with respect to
the Stock of a Pledged Entity; and
(b) (i) Pledgor shall be entitled, from time to time, to
collect and receive for its own use all cash dividends paid in respect
of the Pledged Shares to the extent not in violation of the Credit Agreement
other than any and all: (A) dividends paid or payable other than in cash in
respect of any Pledged Collateral, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange for, any
Pledged Collateral; (B) dividends and other distributions paid or payable in
cash in respect of any Pledged Shares in connection with a partial or total
liquidation or dissolution or in connection with a reduction of capital,
capital surplus or paid-in capital of a Pledged Entity; and (C) cash paid,
payable or otherwise distributed, in respect of principal of, or in redemption
of, or in exchange for, any Pledged Collateral; provided, however, that until
actually paid all rights to such distributions shall remain subject to the Lien
created by this Agreement; and
(ii) all dividends (other than such cash dividends as are
permitted to be paid to Pledgor in accordance with clause (i) above)
and all other distributions in respect of any of the Pledged Shares, whenever
paid or made, shall be delivered to Agent to hold as Pledged Collateral and
shall, if received by Pledgor, be received in trust for the benefit of Agent,
be segregated from the other property or funds of Pledgor, and be forthwith
delivered to Agent as Pledged Collateral in the same form as so received (with
any necessary indorsement).
8. Defaults and Remedies.
(a) Upon the occurrence of an Event of Default and during the
continuation of such Event of Default, and concurrently with written notice to
Pledgor, Agent (personally or through an agent) is hereby authorized and
empowered to transfer and register in its name or in the name of its nominee
the whole or any part of the Pledged Collateral, to exchange certificates
representing or evidencing Pledged Collateral for certificates of smaller or
larger denominations, to exercise the voting rights with respect thereto, to
collect and receive all cash dividends and other distributions made thereon, to
sell in one
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or more sales after ten (10) days' notice of the time and place of any public
sale or of the time at which a private sale is to take place (which notice
Pledgor agrees is commercially reasonable) the whole or any part of the Pledged
Collateral and to otherwise act with respect to the Pledged Collateral as
though Agent was the outright owner thereof, Pledgor hereby irrevocably
constituting and appointing Agent as the proxy and attorney-in-fact of Pledgor,
with full power of substitution to do so, and which appointment shall remain in
effect until the Termination Date; provided, however, Agent shall not have any
duty to exercise any such right or to preserve the same and shall not be liable
for any failure to do so or for any delay in doing so. Any sale shall be made
at a public or private sale at Agent's place of business, or at any place to be
named in the notice of sale, either for cash or upon credit or for future
delivery at such price as Agent may deem fair, and Agent may be the purchaser
of the whole or any part of the Pledged Collateral so sold and hold the same
thereafter in its own right free from any claim of Pledgor or any right of
redemption. Each sale shall be made to the highest bidder, but Agent reserves
the right to reject any and all bids at such sale which, in its discretion, it
shall deem inadequate. Demands of performance, except as otherwise herein
specifically provided for, notices of sale, advertisements and the presence of
property at sale are hereby waived and any sale hereunder may be conducted by
an auctioneer or any officer or agent of Agent.
(b) If, at the original time or times appointed for the sale of
the whole or any part of the Pledged Collateral, the highest bid, if there be
but one sale, shall be inadequate to discharge in full all the Secured
Obligations, or if the Pledged Collateral be offered for sale in lots, if at
any of such sales, the highest bid for the lot offered for sale would indicate
to Agent, in its discretion, that the proceeds of the sales of the whole of the
Pledged Collateral would be unlikely to be sufficient to discharge all the
Secured Obligations, Agent may, on one or more occasions and in its discretion,
postpone any of said sales by public announcement at the time of sale or the
time of previous postponement of sale, and no other notice of such postponement
or postponements of sale need be given, any other notice being hereby waived;
provided, however, that any sale or sales made after such postponement shall be
after ten (10) days' notice to Pledgor.
c) If, at any time when Agent in its sole discretion determines,
following the occurrence and during the continuance of an Event of Default,
that, in connection with any actual or contemplated exercise of its rights
(when permitted under this Section 8) to sell the whole or any part of the
Pledged Shares hereunder, it is necessary or advisable to effect a public
registration of all or part of the Pledged Collateral pursuant to the
Securities Act of 1933, as amended (or any similar statute then in effect) (the
"Act"), Pledgor shall, in an expeditious manner, cause the Pledged Entities to:
(i) Prepare and file with the Securities and Exchange
Commission (the " Commission") a registration statement with
respect to the Pledged Shares and in good faith use commercially
reasonable efforts to cause such registration statement to become and
remain effective;
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(ii) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Act with respect to the sale
or other disposition of the Pledged Shares covered by such registration
statement whenever Agent shall desire to sell or otherwise dispose of the
Pledged Shares;
(iii) Furnish to Agent such numbers of copies of a prospectus and a
preliminary prospectus, in conformity with the requirements of the Act, and
such other documents as Agent may request in order to facilitate the public
sale or other disposition of the Pledged Shares by Agent;
(iv) Use commercially reasonable efforts to register or qualify the
Pledged Shares covered by such registration statement under such other
securities or blue sky laws of such jurisdictions within the United States and
Puerto Rico as Agent shall request, and do such other reasonable acts and
things as may be required of it to enable Agent to consummate the public sale
or other disposition in such jurisdictions of the Pledged Shares by Agent;
(v) Furnish, at the request of Agent, on the date that shares of the
Pledged Collateral are delivered to the underwriters for sale pursuant to such
registration or, if the security is not being sold through underwriters, on the
date that the registration statement with respect to such Pledged Shares
becomes effective, (A) an opinion, dated such date, of the independent counsel
representing such registrant for the purposes of such registration, addressed
to the underwriters, if any, and in the event the Pledged Shares are not being
sold through underwriters, then to Agent, in customary form and covering
matters of the type customarily covered in such legal opinions; and (B) a
comfort letter, dated such date, from the independent certified public
accountants of such registrant, addressed to the underwriters, if any, and in
the event the Pledged Shares are not being sold through underwriters, then to
Agent, in a customary form and covering matters of the type customarily covered
by such comfort letters and as the underwriters or Agent shall reasonably
request. The opinion of counsel referred to above shall additionally cover
such other legal matters with respect to the registration in respect of which
such opinion is being given as Agent may reasonably request. The letter
referred to above from the independent certified public accountants shall
additionally cover such other financial matters (including information as to
the period ending not more than five (5) Business Days prior to the date of
such letter) with respect to the registration in respect of which such letter
is being given as Agent may reasonably request; and
(vi) Otherwise use commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable but not later than 18
months
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after the effective date of the registration statement, an earnings
statement covering the period of at least 12 months beginning with the
first full month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Act.
(d) All expenses incurred in complying with Section 8(c) hereof,
including, without limitation, all registration and filing fees (including all
expenses incident to filing with the National Association of Securities
Dealers, Inc.), printing expenses, fees and disbursements of counsel for the
registrant, the fees and expenses of counsel for Agent, expenses of the
independent certified public accountants (including any special audits incident
to or required by any such registration) and expenses of complying with the
securities or blue sky laws or any jurisdictions, shall be paid by Pledgor.
(e) If, at any time when Agent shall determine to exercise its
right to sell the whole or any part of the Pledged Collateral hereunder, such
Pledged Collateral or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under the Securities Act of 1933, as
amended (or any similar statute then in effect) (the "Act"), Agent may, in its
discretion (subject only to applicable requirements of law), sell such Pledged
Collateral or part thereof by private sale in such manner and under such
circumstances as Agent may deem necessary or advisable, but subject to the
other requirements of this Section 8, and shall not be required to effect such
registration or to cause the same to be effected. Without limiting the
generality of the foregoing, in any such event, Agent in its discretion (x)
may, in accordance with applicable securities laws, proceed to make such
private sale notwithstanding that a registration statement for the purpose of
registering such Pledged Collateral or part thereof could be or shall have been
filed under said Act (or similar statute), (y) may approach and negotiate with
a single possible purchaser to effect such sale, and (z) may restrict such sale
to a purchaser who is an accredited investor under the Act and who will
represent and agree that such purchaser is purchasing for its own account, for
investment and not with a view to the distribution or sale of such Pledged
Collateral or any part thereof. In addition to a private sale as provided
above in this Section 8, if any of the Pledged Collateral shall not be freely
distributable to the public without registration under the Act (or similar
statute) at the time of any proposed sale pursuant to this Section 8, then
Agent shall not be required to effect such registration or cause the same to be
effected but, in its discretion (subject only to applicable requirements of
law), may require that any sale hereunder (including a sale at auction) be
conducted subject to restrictions:
(i) as to the financial sophistication and ability of any
Person permitted to bid or purchase at any such sale;
(ii) as to the content of legends to be placed upon any
certificates representing the Pledged Collateral sold in such sale,
including restrictions on future transfer thereof;
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(iii) as to the representations required to be made by each
Person bidding or purchasing at such sale relating to that
Person's access to financial information about Pledgor and such
Person's intentions as to the holding of the Pledged Collateral so sold
for investment for its own account and not with a view to the
distribution thereof; and
(iv) as to such other matters as Agent may, in its
discretion, deem necessary or appropriate in order that such sale
(notwithstanding any failure so to register) may be effected in
compliance with the Bankruptcy Code and other laws affecting the
enforcement of creditors' rights and the Act and all applicable state
securities laws.
(f) Pledgor recognizes that Agent may be unable to effect
a public sale of any or all the Pledged Collateral and may be compelled to
resort to one or more private sales thereof in accordance with clause (e)
above. Pledgor also acknowledges that any such private sale may result in
prices and 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 not be deemed to have been made in a commercially
unreasonable manner solely by virtue of such sale being private. Agent shall
be under no obligation to delay a sale of any of the Pledged Collateral for the
period of time necessary to permit the Pledged Entity to register such
securities for public sale under the Act, or under applicable state securities
laws, even if Pledgor and the Pledged Entity would agree to do so.
(g) Pledgor agrees to the maximum extent permitted by
applicable law that following the occurrence and during the continuance of an
Event of Default it will not at any time plead, claim or take the benefit of
any appraisal, valuation, stay, extension, moratorium or redemption law now or
hereafter in force in order to prevent or delay the enforcement of this
Agreement, or the absolute sale of the whole or any part of the Pledged
Collateral or the possession thereof by any purchaser at any sale hereunder,
and Pledgor waives the benefit of all such laws to the extent it lawfully may
do so. Pledgor agrees that it will not interfere with any right, power and
remedy of Agent provided for in this Agreement or now or hereafter existing at
law or in equity or by statute or otherwise, or the exercise or beginning of
the exercise by Agent of any one or more of such rights, powers or remedies.
No failure or delay on the part of Agent to exercise any such right, power or
remedy and no notice or demand which may be given to or made upon Pledgor by
Agent with respect to any such remedies shall operate as a waiver thereof, or
limit or impair Agent's right to take any action or to exercise any power or
remedy hereunder, without notice or demand, or prejudice its rights as against
Pledgor in any respect.
(h) Pledgor further agrees that a breach of any of the
covenants contained in this Section 8 will cause irreparable injury to Agent,
that Agent shall have no adequate remedy at law in respect of such breach and,
as a consequence, agrees that each and every covenant contained in this Section
8 shall be specifically enforceable against Pledgor, and
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Pledgor hereby waives and agrees not to assert any defenses against an action
for specific performance of such covenants except for a defense that the
Secured Obligations are not then due and payable in accordance with the
agreements and instruments governing and evidencing such obligations.
9. Waiver. No delay on Agent's part in exercising any
power of sale, Lien, option or other right hereunder, and no notice or demand
which may be given to or made upon Pledgor by Agent with respect to any power
of sale, Lien, option or other right hereunder, shall constitute a waiver
thereof, or limit or impair Agent's right to take any action or to exercise any
power of sale, Lien, option, or any other right hereunder, without notice or
demand, or prejudice Agent's rights as against Pledgor in any respect.
10. Assignment. Agent may assign, indorse or transfer
any instrument evidencing all or any part of the Secured Obligations as
provided in, and in accordance with, the Credit Agreement, and the holder of
such instrument shall be entitled to the benefits of this Agreement.
11. Termination. Immediately following the Termination
Date, Agent shall deliver to Pledgor the Pledged Collateral pledged by Pledgor
at the time subject to this Agreement and all instruments of assignment
executed in connection therewith, free and clear of the Liens hereof and,
except as otherwise provided herein, all of Pledgor's obligations hereunder
shall at such time terminate.
12. Lien Absolute. All rights of Agent hereunder, and
all obligations of Pledgor hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of the Credit
Agreement, any other Loan Document or any other agreement or instrument
governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment
of, or in any other term of, all or any part of the Secured
Obligations, or any other amendment or waiver of or any consent to any
departure from the Credit Agreement, any other Loan Document or any
other agreement or instrument governing or evidencing any Secured
Obligations;
(c) any exchange, release or non-perfection of any other
Collateral, or any release or amendment or waiver of or consent
to departure from any guaranty, for all or any of the Secured
Obligations;
(d) the insolvency of any Credit Party; or
(e) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, Pledgor.
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13. Release. Pledgor consents and agrees that Agent may
at any time, or from time to time, in its discretion:
(a) renew, extend or change the time of payment, and/or
the manner, place or terms of payment of all or any part of the
Secured Obligations; and
(b) exchange, release and/or surrender all or any of the
Collateral (including the Pledged Collateral), or any part
thereof, by whomsoever deposited, which is now or may hereafter be held
by Agent in connection with all or any of the Secured Obligations; all
in such manner and upon such terms as Agent may deem proper, and
without notice to or further assent from Pledgor, it being hereby
agreed that Pledgor shall be and remain bound upon this Agreement,
irrespective of the value or condition of any of the Collateral, and
notwithstanding any such change, exchange, settlement, compromise,
surrender, release, renewal or extension, and notwithstanding also that
the Secured Obligations may, at any time, exceed the aggregate
principal amount thereof set forth in the Credit Agreement, or any
other agreement governing any Secured Obligations. Pledgor hereby
waives notice of acceptance of this Agreement, and also presentment,
demand, protest and notice of dishonor of any and all of the Secured
Obligations, and promptness in commencing suit against any party hereto
or liable hereon, and in giving any notice to or of making any claim or
demand hereunder upon Pledgor. No act or omission of any kind on
Agent's part shall in any event affect or impair this Agreement.
14. Reinstatement. Notwithstanding anything contained
herein to the contrary, this Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or against Pledgor
or any Pledged Entity for liquidation or reorganization, should Pledgor or any
Pledged Entity become insolvent or make an assignment for the benefit of
creditors or should a receiver or trustee be appointed for all or any
significant part of Pledgor's or a Pledged Entity's assets, and shall continue
to be effective or be reinstated, as the case may be, if at any time payment
and performance of the Secured Obligations, or any part thereof, is, pursuant
to applicable law, rescinded, avoided or reduced in amount, or must otherwise
be restored or returned by any obligee of the Secured Obligations, whether as a
"voidable preference", "fraudulent transfers", "fraudulent conveyance", or
otherwise, all as though such payment or performance had not been made.
Notwithstanding anything contained herein to the contrary, in the event that
any payment, or any part thereof, is rescinded, avoided, reduced, restored or
returned, the Secured Obligations shall be reinstated and deemed reduced only
by such amount paid and not so rescinded, avoided, reduced, restored or
returned.
15. Miscellaneous.
(a) Agent may execute any of its duties hereunder by or
through agents or employees and shall be entitled to advice of
counsel concerning all matters pertaining to its duties hereunder.
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(b) Pledgor agrees to promptly reimburse Agent for actual
out-of-pocket expenses, including, without limitation,
reasonable counsel fees, incurred by Agent in connection with the
administration and enforcement of this Agreement as provided in the
Credit Agreement.
(c) Neither Agent, nor any of its respective officers,
directors, employees, agents or counsel shall be liable for any
action lawfully taken or omitted to be taken by it or them hereunder or
in connection herewith, except for its or their own gross negligence or
willful misconduct as finally determined by a court of competent
jurisdiction.
(d) THIS AGREEMENT SHALL BE BINDING UPON PLEDGOR AND ITS
SUCCESSORS AND ASSIGNS (INCLUDING A DEBTOR-IN-POSSESSION ON
BEHALF OF PLEDGOR), AND SHALL INURE TO THE BENEFIT OF, AND BE
ENFORCEABLE BY, AGENT AND ITS SUCCESSORS AND ASSIGNS, AND SHALL BE
GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF ILLINOIS APPLICABLE TO CONTRACTS MADE AND PERFORMED IN
THAT STATE, AND NONE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT MAY
BE WAIVED, ALTERED, MODIFIED OR AMENDED EXCEPT IN WRITING DULY SIGNED
FOR AND ON BEHALF OF AGENT AND PLEDGOR.
16. Severability. If for any reason any provision or
provisions hereof are determined to be invalid and contrary to any existing or
future law, such invalidity shall not impair the operation of or effect those
portions of this Agreement which are valid.
17. Notices. Except as otherwise provided herein,
whenever it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be given to or served
upon any of the parties by any other party, or whenever any of the parties
desires to give or serve upon any other a communication with respect to this
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and shall be given in the manner, and
deemed received, as provided for in the Credit Agreement.
18. Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
19. Counterparts. This Agreement may be executed in any
number of counterparts, which shall, collectively and separately, constitute
one agreement.
20. Benefit of Lenders. All security interests granted
or contemplated hereby shall be for the benefit of Agent and Lenders, and all
proceeds or payments realized from the Pledged Collateral in accordance
herewith shall be applied to the Secured Obligations in accordance with the
terms of the Credit Agreement.
12
13
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
CODE-ALARM, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Name: Xxxx Xxxxxxx
--------------------------
Title: President
--------------------------
GENERAL ELECTRIC CAPITAL
CORPORATION,
as Agent
By: /s/ Xxxxxxx X. Xxx Xxxx
---------------------------------
Name: Xxxxxxx X. Xxx Xxxx
-----------------------------
Its Duly Authorized Signatory
14
SCHEDULE I
PLEDGED SHARES
Class Stock Certificate Number Percentage of
Pledged Entity of Stock Number(s) of Shares Outstanding Shares
-------------- -------- ----------------- --------- ------------------
Tessco Group, Inc. Common 001 1000 100%
Anes, Inc. Common 1001 1000 100%
Xxxxxxx Security Common 1001 1000 100%
Systems, Inc.
Intercept Systems, Common 1001 1000 100%
Inc.
15
SCHEDULE II
PLEDGE AMENDMENT
This Pledge Amendment, dated October 24, 1997 is delivered pursuant
to Section 6(d) of the Pledge Agreement referred to below. All defined terms
herein shall have the meanings ascribed thereto or incorporated by reference in
the Pledge Agreement. The undersigned hereby certifies that the
representations and warranties in Section 5 of the Pledge Agreement are and
continue to be true and correct, both as to the shares pledged prior to this
Pledge Amendment and as to the shares pledged pursuant to this Pledge
Amendment. The undersigned further agrees that this Pledge Amendment may be
attached to that certain Pledge Agreement, dated October 24, 1997, between
undersigned, as Pledgor, and General Electric Capital Corporation, as Agent,
(the "Pledge Agreement") and that the Pledged Shares listed on this Pledge
Amendment shall be and become a part of the Pledged Collateral referred to in
said Pledge Agreement and shall secure all Secured Obligations referred to in
said Pledge Agreement. The undersigned acknowledges that any shares not
included in the Pledged Collateral at the discretion of Agent may not otherwise
be pledged by Pledgor to any other Person or otherwise used as security for any
obligations other than the Secured Obligations and the other Obligations (as
defined in that certain Credit Agreement dated as of October 24, 1997 among
Code-Alarm, Inc., the Persons named therein as Credit Parties, the Persons
signatory thereto from time to time as Lenders and General Electric Capital
Corporation, as Agent).
CODE-ALARM, INC.
By:_______________________________________
Name:__________________________________
Title:_________________________________
Name and Class Certificate Number
Address of Pledgor Pledged Entity of Stock Number(s) of Shares
------------------ -------------- ---------- -------- ----------
16
EXHIBIT
to
PLEDGE AGREEMENT
dated as of October 24, 1997
Form of Stock Power
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to ________________________________________ _____ Shares of Capital
Stock of Tessco Group, Inc., a Michigan corporation, represented by Certificate
No. __________ ________________ (the "Stock"), standing in the name of the
undersigned on the books of said corporation and does hereby irrevocably
constitute and appoint ________________________________________________________
as the undersigned's true and lawful attorney, for it and in its name
and stead, to sell, assign and transfer all or any of the Stock, and for that
purpose to make and execute all necessary endorsements or other acts of
assignment and transfer thereof; and to substitute one or more persons with
like full power, hereby ratifying and confirming all that said attorney or
substitute or substitutes shall lawfully do by virtue hereof.
Dated:________________________________________
CODE-ALARM, INC.
By:_________________________
Title:
17
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to ________________________________________ _____ Shares of Capital
Stock of Tessco Group, Inc., a Michigan corporation, represented by Certificate
No. __________ ________________ (the "Stock"), standing in the name of the
undersigned on the books of said corporation and does hereby irrevocably
constitute and appoint ________________________________________________________
as the undersigned's true and lawful attorney, for it and in its name
and stead, to sell, assign and transfer all or any of the Stock, and for that
purpose to make and execute all necessary endorsements or other acts of
assignment and transfer thereof; and to substitute one or more persons with
like full power, hereby ratifying and confirming all that said attorney or
substitute or substitutes shall lawfully do by virtue hereof.
Dated:________________________________________
CODE-ALARM, INC.
By: /s/ Xxxx Xxxxxxx
-------------------------
Title: President
18
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to ________________________________________ _____ Shares of Capital
Stock of Anes, Inc., a Michigan corporation, represented by Certificate No.
________________________ __ (the "Stock"), standing in the name of the
undersigned on the books of said corporation and does hereby irrevocably
constitute and appoint ________________________________________________________
as the undersigned's true and lawful attorney, for it and in its name
and stead, to sell, assign and transfer all or any of the Stock, and for that
purpose to make and execute all necessary endorsements or other acts of
assignment and transfer thereof; and to substitute one or more persons with
like full power, hereby ratifying and confirming all that said attorney or
substitute or substitutes shall lawfully do by virtue hereof.
Dated:________________________________________
CODE-ALARM, INC.
By: /s/ Xxxx Xxxxxxx
----------------------
Title: President
19
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to ________________________________________ _____ Shares of Capital
Stock of Xxxxxxx Security Systems, Inc., a Michigan corporation, represented by
Certificate No. ___________________________ (the "Stock"), standing in the name
of the undersigned on the books of said corporation and does hereby irrevocably
constitute and appoint _____________as the undersigned's true and lawful
attorney, for it and in its name and stead, to sell, assign and transfer all or
any of the Stock, and for that purpose to make and execute all necessary
endorsements or other acts of assignment and transfer thereof; and to
substitute one or more persons with like full power, hereby ratifying and
confirming all that said attorney or substitute or substitutes shall lawfully
do by virtue hereof.
Dated:________________________________________
CODE-ALARM, INC.
By: /s/ Xxxx Xxxxxxx
-----------------------
Title: President
20
STOCK POWER
FOR VALUE RECEIVED, the undersigned does hereby sell, assign and
transfer to ________________________________________ _____ Shares of Capital
Stock of Intercept Systems, Inc., a Michigan corporation, represented by
Certificate No. _____ _____________________ (the "Stock"), standing in the name
of the undersigned on the books of said corporation and does hereby irrevocably
constitute and appoint ________________________________________________________
as the undersigned's true and lawful attorney, for it and in its name
and stead, to sell, assign and transfer all or any of the Stock, and for that
purpose to make and execute all necessary endorsements or other acts of
assignment and transfer thereof; and to substitute one or more persons with
like full power, hereby ratifying and confirming all that said attorney or
substitute or substitutes shall lawfully do by virtue hereof.
Dated:________________________________________
CODE-ALARM, INC.
By: /s/ Xxxx Xxxxxxx
-----------------------
Title: President
