EQUITY PLEDGE AGREEMENT
Exhibit 10.4
Execution Version
THIS EQUITY PLEDGE AGREEMENT (this “Agreement”) dated as of this 24th day of
October, 2008, between MAIN STREET CAPITAL CORPORATION, a Maryland corporation (the
“Borrower”), MAIN STREET EQUITY INTERESTS, INC., a Delaware corporation (“MSEI” and
together with the Borrower, the “Pledgors” and each, a “Pledgor”), and BRANCH
BANKING AND TRUST COMPANY (“BB&T”), acting as agent (in such capacity, the
“Administrative Agent”) for itself and the other Secured Parties (as defined in the
Credit Agreement referred to below).
W I T N E S S E T H
WHEREAS, the Administrative Agent and the Lenders (as defined in the Credit Agreement) have
agreed to extend credit to Borrower pursuant to the terms of that certain Credit Agreement of even
date herewith (as amended, restated, or otherwise modified from time to time, the “Credit
Agreement”) among the Pledgors, the other Guarantors, the Administrative Agent, the Lenders
signatory thereto and BB&T Capital Markets, as Lead Arranger;
WHEREAS, the Pledgors may from time to time enter into or guarantee one or more Hedge
Transactions (as defined in the Credit Agreement) with the Hedge Counterparties (as defined in the
Credit Agreement);
WHEREAS, each Pledgor beneficially and legally owns the limited liability company membership
interests, limited partnership interests, stock and other equity interests in the Guarantor and/or
the other Loan Parties and the Subsidiaries (as each such term is defined in the Credit Agreement)
described on Schedule I attached hereto (the “Pledged Entities”); and
WHEREAS, it is a condition of the Lenders’ agreement to extend credit to Borrower pursuant to
the Credit Agreement that the Administrative Agent, on behalf of the Secured Parties (as defined in
the Credit Agreement), receive a pledge of the Collateral (as defined below) hereunder by Pledgors’
execution and delivery of this Agreement to secure: (a) the due and punctual payment by Borrower
of: (i) the principal of and interest on the Notes (including, without limitation, any and all
Revolver Advances), when and as due, whether at maturity, by acceleration, upon one or more dates
set for prepayment or otherwise and any renewals, modifications or extensions thereof, in whole or
in part; (ii) each payment required to be made by any Pledgor under the Credit Agreement, when and
as due, including payments in respect of reimbursement of disbursements, interest thereon, and
obligations, if any, to provide cash collateral and any renewals, modifications or extensions
thereof, in whole or in part; and (iii) all other monetary obligations of any Pledgor to the
Secured Parties under the Credit Agreement and the other Loan Documents to which any Pledgor is or
is to be a party and any renewals, modifications or extensions thereof, in whole or in part; (b)
the due and punctual performance of all other obligations of any Pledgor under the Credit Agreement
and the other Loan Documents to which such Pledgor is or is to be a party, and any renewals,
modifications or extensions thereof, in whole or in part; (c) the due and punctual payment (whether
at the stated maturity, by acceleration or otherwise) of all obligations (including any and all
Hedging Obligations (as defined in the Credit Agreement) arising under Hedging Agreements and
obligations which, but for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due), indebtedness and liabilities of any Pledgor, now existing or hereafter incurred under,
arising out of or in connection with any and all Hedging Agreements and any renewals, modifications
or extensions thereof (including, all obligations, if any, of any Pledgor as guarantor under the
Credit Agreement in respect of Hedging Agreements), and the due and punctual performance and
compliance by each Pledgor with all of the terms, conditions and agreements contained in any
Hedging Agreements and any renewals, modifications or extensions thereof; (d) the due and punctual
payment and performance of all indebtedness, liabilities and obligations of any one or more of
Pledgors and the Guarantors arising out of or relating to any Bank Products; (e) the due and
punctual payment and performance of all indebtedness, liabilities and obligations of any one or
more of Pledgors and the Guarantors arising out of or relating to any Cash Management Services; and
(f) the due and punctual payment and performance of all obligations of each of the Guarantors under
the Credit Agreement and the other Loan Documents to which they are or are to be a party and any
and all renewals, modifications or extensions thereof, in whole or in part (all of the foregoing
indebtedness, liabilities and obligations being collectively called the “Obligations”).
NOW, THEREFORE, in consideration of the premises and of the mutual covenants herein contained,
and for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereby agree as follows:
SECTION 1. Definitions. Any capitalized terms used but not defined herein shall have
the meanings assigned to them in the Credit Agreement.
SECTION 2. Pledge; Perfection.
(a) As collateral security for the due and punctual payment of the Obligations, each
Pledgor hereby pledges, hypothecates, delivers and assigns and grants unto Administrative
Agent, as agent for itself and the Secured Parties, a security interest (which security
interest shall constitute a first priority security interest), in all of Pledgor’s
membership interests, limited partnership interests, common stock and other equity interests
in the Pledged Entities and all securities instruments or other rights convertible into or
exercisable for the foregoing (the “Equity Interests”), together with all proceeds,
profits, interests, capital accounts, accounts, contract rights, general intangibles,
deposits, funds, dividends, distributions, rights to dividends, rights to distributions,
including both distributions of money and of property, and other rights, claims and
interests relating to or arising out of Pledgor’s Equity Interests, now owned or hereafter
acquired, in the Pledged Entities, together with any and all replacements or substitutions
for or proceeds of all of the foregoing (collectively, the “Collateral”);
provided that, notwithstanding anything herein to the contrary, Collateral
shall not include, and the security interest herein shall not attach to, (i) the Equity
Interests issued by the entities identified as Small Business Investment Corporations on
Schedule I, (ii) any outstanding Equity Interests of a Foreign Subsidiary in excess
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of 65% of the voting power of all classes of Equity Interests of such Foreign Subsidiary
entitled to vote or (iii) any property rights in Equity Interests (other than Equity
Interests issued by any Subsidiary), or any Operating Documents of any issuer of such Equity
Interests to which Pledgor is a party, or any of its rights or interests thereunder, if the
grant of such security interest shall constitute or result in (A) the abandonment,
invalidation or unenforceability of any right, title or interest of the Pledgor therein or
(B) in a breach or termination pursuant to the terms of, or a default under, any such
property rights or Operating Documents (other than to the extent that any such term would be
rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any
successor provisions) of any relevant jurisdiction or any other Applicable Law (including
the Bankruptcy Code) or principals of equity) (the Equity Interests described in foregoing
clauses (i) through (iii), the “Excluded Equity Interests”); provided
further that, (x) immediately upon any amendment, modification or repeal of
the Restrictive Provisions to allow the pledge of any Excluded Equity Interests of the type
described in clause (i), the Collateral shall include, and the security interest granted
hereunder shall attach to, such Equity Interests that are no longer subject to such
Restrictive Provisions and (y) until such time as attachment occurs with respect to any
Excluded Equity Interest of the type described in clause (i) or (iii), references in this
Agreement to “Pledged Entities” shall be deemed not to include the issuers of such Excluded
Equity Interest.
This Agreement is not intended to place Administrative Agent or any Secured Party in a
position of being a member, shareholder or partner of any Pledged Entity, but is intended to
grant Administrative Agent, on behalf of the Secured Parties, a lien on and security
interest in Pledgor’s Equity Interests in the Pledged Entities including, without
limitation, any and all of the Collateral but specifically excluding any general partnership
interests.
(b) Each Pledgor hereby delivers to the Administrative Agent (or to the Collateral
Custodian as its agent and bailee), on behalf of the Secured Parties, including itself,
herewith all certificates, instruments and documents, if any, representing the Equity
Interests in the Pledged Entities to be held by the Administrative Agent as Collateral,
together with a transfer power in blank duly executed by Pledgor.
SECTION 3. Representations and Warranties. Each Pledgor hereby represents and
warrants, as of the date hereof and each day on which a Borrowing is made, that:
(a) Pledgor has all requisite power and authority to enter into this Agreement, to
grant a security interest in the Collateral for the purposes described in Section 2 and to
carry out the transactions contemplated by this Agreement;
(b) No approval of or consent from any person or entity (other than the acknowledgement
and consent of any Pledged Entity which is a Subsidiary as evidenced by its signature
hereto) is required in connection with the execution and delivery by Pledgor of this
Agreement, the granting and perfection of the security interests in the Collateral, or the
carrying out of the transactions contemplated by this Agreement (including the exercise by
the Administrative Agent of the voting or other rights provided for in this Agreement or the
exercise of remedies in respect thereof);
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(c) Pledgor is the record and beneficial owner of the Collateral as of the date hereof;
(d) All of the Collateral is owned by Pledgor free and clear of any pledge, mortgage,
hypothecation, lien, charge, encumbrance or any security interest in such Collateral or the
proceeds thereof, except for the security interest granted to the Administrative Agent on
behalf of the Secured Parties hereunder, and there are no outstanding warrants, options or
other rights to purchase, or shareholder, voting trust or similar agreements outstanding
with respect to, or property that is convertible into, or that requires the issuance of sale
of, any Equity Interests;
(e) The execution, delivery and performance by Pledgor of this Agreement do not and
will not contravene or constitute a default under or result in any violation of any
agreement (including, without limitation, the operating or partnership agreement of any
Pledged Entity), indenture or other instrument, license, judgment, decree, order, law,
statute, ordinance or other governmental rule or regulation applicable to Pledgor;
(f) On each Representation Date (as defined in the Security Agreement), Schedule
I hereto (as such schedule may be amended or supplemented from time to time pursuant to
the terms of this Agreement) sets forth all of the issued and outstanding Equity Interests
held by Pledgor and such Equity Interests constitute the percentage of issued and
outstanding shares of stock, percentage of membership interests or percentage of partnership
interests of the respective Pledged Entities indicated on Schedule I.
(g) Each Pledged Entity is a limited liability company, limited partnership or
corporation duly formed, validly existing and in good standing as such under the laws of the
jurisdiction of its organization as set forth on Schedule I hereto, and the
execution and delivery of this Agreement require no action by or in respect of, or filing
with, any governmental body, agency or official (except for the Uniform Commercial Code
filings set forth in paragraph (h) below) and do not contravene, or constitute a default
under, the operating agreement, partnership agreement, charter or by-laws of any Pledged
Entity;
(h) Upon filing of a Uniform Commercial Code Financing Statement with the U.C.C.
records of the Secretary of State of the state of organization of each Pledgor, this
Agreement creates and grants a valid lien on and perfected security interest in the
Collateral and the proceeds thereof, subject to no prior security interest, lien, charge or
encumbrance, or to any agreement purporting to grant to any third party a security interest
in the property or assets of such Pledgor which would include the Collateral;
(i) A true, correct and complete copy of the operating agreement, limited partnership
agreement, charter and by-laws, as the case may be, of each Pledged Entity (together with
all amendments thereto) has been provided to the Administrative Agent;
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(j) to the extent that any limited liability company interests or partnership interests
pledged as Collateral are or represent issuers that have opted to be treated as securities
under the applicable U.C.C., the certificates representing such securities have been
delivered to the Administrative Agent (or to the Collateral Custodian as its agent and
bailee), and no limited liability company interests or partnership interests pledged as
Collateral are dealt in or traded on securities exchanges or markets; and
(k) None of the Equity Interests constitutes Margin Stock.
SECTION 4. Voting Rights; Distributions, Etc.
(a) So long as no Event of Default, as defined in the Credit Agreement, shall have
occurred and be continuing:
| (i) | Each Pledgor shall be entitled to exercise any and all voting
and/or other consensual rights and powers relating or pertaining to the
Collateral or any part thereof, provided, however, that no vote shall be cast
or right exercised or other action taken which would (x) impair the Collateral
or any portion thereof or the rights and remedies of the Administrative Agent
under the Loan Documents, or (y) have or would reasonably be expected to have a
material adverse effect on the Collateral or any material part thereof or (z)
result in any violation of the provisions of this Agreement, the Credit
Agreement or any other Loan Document, |
| (ii) | except to the extent limited by this Agreement, the Credit
Agreement or any other Loan Document, each Pledgor shall be entitled to receive
and retain any and all cash dividends or cash distributions payable on the
Collateral, but any and all equity interests and/or liquidating dividends,
distributions in property, returns of capital, or other distributions made on
or in respect of the Collateral, whether resulting from a subdivision,
combination, or reclassification of the outstanding ownership units or other
interests of the Pledged Entities or received in exchange for the Collateral or
any part thereof or as a result of any merger, consolidation, acquisition, or
other exchange of assets to which any Pledged Entity may be a party or
otherwise, and any and all cash and other property received in redemption of or
in exchange for any Collateral (either upon call for redemption or otherwise),
shall be and become part of the Collateral pledged hereunder and, if received
by Pledgor, shall forthwith be delivered to Administrative Agent (accompanied
by proper instruments of assignment and/or powers of attorneys executed by
Pledgor) to be held subject to the terms of this Agreement; |
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(b) Upon the occurrence and during the continuance of an Event of Default, all rights
of each Pledgor to exercise the voting and/or other consensual rights and powers that
Pledgor is entitled to exercise pursuant to Section 4(a)(i) hereof and/or to receive the
payments that Pledgor is authorized to receive and retain pursuant to Section 4(a)(ii)
hereof shall cease, and all such rights shall thereupon become vested in Administrative
Agent for the benefit of the Secured Parties, who shall have the sole and exclusive right
and authority to exercise such voting and/or other consensual rights and powers and/or to
receive and retain such payments; provided, that nothing herein shall obligate
Administrative Agent to exercise such voting and/or other consensual rights, all such action
in such regard being solely in Administrative Agent’s or Secured Parties’ discretion. Any
and all money and other property paid over to or received by Administrative Agent pursuant
to the provisions of this paragraph (b) shall be retained by Administrative Agent as
additional Collateral hereunder and be applied in accordance with the provisions hereof.
SECTION 5. Covenants. Each Pledgor hereby covenants that until such time as the
Obligations shall have been indefeasibly paid in full:
(a) Pledgor will not, without the prior written consent of the Administrative Agent,
sell, convey, assign, or otherwise dispose of, or grant any option with respect to, all or
any part of the Collateral or any interest therein, except that Pledgor shall be permitted
to receive and dispose of distributions to the extent permitted by Section 4 (a)(ii) above;
nor will Pledgor create, incur or permit to exist any pledge, mortgage, lien, charge,
encumbrance or security interest whatsoever with respect to all or any part of the
Collateral or the proceeds thereof, other than that created hereby; nor will Pledgor amend
or terminate, or waive any default under or breach of the terms of the operating agreement,
limited partnership agreement or charter of any Pledged Entity or consent to or permit any
amendment, termination or waiver thereof, except as not otherwise prohibited under the Loan
Documents and to the extent such action does not and would not reasonably be likely to have
a material adverse effect with respect to the Pledged Entity or the Collateral; nor will
Pledgor enter into any contractual obligations that restrict or inhibit, or which would
reasonably be expected to restrict or inhibit, the Administrative Agent’s rights or ability
to vote or sell or otherwise dispose of the Collateral or any part thereof after an Event of
Default; nor will Pledgor consent to or permit the issuance of any additional Equity
Interests in any Pledged Entity (unless pledged to Administrative Agent hereunder), or any
securities or instruments exercisable or exchangeable for Equity Interests in any Pledged
Entity or otherwise representing any right to acquire any Equity Interest in any Pledged
Entity or any general partnership interests in any Pledged Entity that is a limited
partnership.
(b) Pledgor will not permit any Pledged Entity to change its entity form or, except as
permitted under the Credit Agreement, merge into or consolidate into any other entity and
will give to Administrative Agent not less than 20 days’ prior written notice of (i) any
change in the name of any Pledgor or the name of any Pledged Entity or (ii) any change in
the location of the principal place of business (or, in the case of an individual Pledgor,
the principal residence) of Pledgor or any Pledged Entity; provided that Pledgor
shall not permit any change described in the preceding clauses (i) and (ii) unless Pledgor
shall have taken all actions necessary or reasonably requested by the Administrative Agent
to maintain the continuance, validity, perfection and the same or better priority of the
Administrative Agent in the Collateral.
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(c) Pledgor will, at Pledgor’s own expense, defend Administrative Agent’s and Secured
Parties’ right, title, special property and security interest in and to the Collateral and
any distributions with respect thereto against the claims of any Person (other than the
holders of Permitted Encumbrances).
(d) Pledgor will comply with all its obligations under any limited liability company or
partnership agreement relating to the Equity Interests and will preserve and protect the
Collateral.
(e) Pledgor will promptly pay and discharge before the same become delinquent, all
taxes, assessments and governmental charges or levies imposed on Pledgor or the Collateral,
except for taxes timely disputed in good faith, for which adequate reserves have been made.
(f) The Secured Parties shall have the right, upon request on the terms set forth in
Section 5.02 of the Credit Agreement, to review, examine and audit the books and records of
any Pledged Entity and of Pledgor with regard to the Collateral and any distributions with
respect thereto.
(g) Pledgor consents to the transfer pursuant to the collateral assignment, pledge or
grant of security interest in any limited liability company or partnership interest pledged
as Collateral to the Administrative Agent or its nominee and, following the occurrence and
during the continuance of an Event of Default, consents to the transfer of any such
interests to and the admission of the Administrative Agent or its nominee as a member in any
limited liability company or partner in any partnership, as the case may be, with all the
rights and powers related thereto.
(h) In the event that Pledgor acquires rights in any Equity Interests after the date of
this Agreement, Pledgor shall deliver to the Administrative Agent, on or before the
Reporting Date (as defined in the Security Agreement) immediately following the end of the
Fiscal Quarter during which it acquires any such rights, a completed Pledge Supplement,
substantially in the form of Exhibit A attached hereto, reflecting such new Equity
Interests and all other Equity Interests. Notwithstanding the foregoing it is understood
and agreed that the security interest of the Administrative Agent shall attach to all such
newly acquired Equity Interests immediately upon Pledgor’s acquisition of rights therein and
shall not be affected by the failure of Pledgor to deliver such supplement.
SECTION 6. Remedies upon Default. Upon the occurrence and during the continuance of
an Event of Default, Administrative Agent may, in addition to the exercise by Administrative Agent
of its rights and remedies under any other Section of this Agreement or under the Credit Agreement
or any other agreement relating to the Obligations or otherwise available to it at law or in
equity:
(a) declare the principal of and all accrued interest on and any other amounts owing
with respect to the Obligations immediately due and payable, without demand, protest, notice
of default, notice of acceleration or of intention to accelerate or other notices of any
kind, and
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(b) exercise all the rights and remedies of a secured party under the Uniform
Commercial Code in effect in the State of North Carolina at that time and sell
(in compliance with applicable laws, including securities laws) the Collateral, or any part
thereof, at public or private sale, at any broker’s board, upon any securities exchange, or
elsewhere, for cash, upon credit, or for future delivery, as Administrative Agent may deem
appropriate in the circumstances and commercially reasonable. Administrative Agent shall
have the right to impose limitations and restrictions on the sale of the Collateral as
Administrative Agent may deem to be necessary or appropriate to comply with any law, rule,
or regulation (Federal, state, or local) having applicability to the sale, including, but
without limitation, restrictions on the number and qualifications of the offerees and
requirements for any necessary governmental approvals, and Administrative Agent shall be
authorized at any such sale (if it deems it necessary or advisable to do so) to restrict the
prospective offerees or purchasers to Persons who will represent and agree that they are
purchasing securities included in the Collateral for their own account and not with a view
to the distribution or sale thereof in violation of applicable securities laws and Pledgor
hereby waives, to the maximum extent permitted by law, any claim arising because the price
at which the Collateral may have been sold at such private sale was less than the price that
might have been obtained at public sale, even if Administrative Agent accepts the first
offer received and does not offer such Collateral to more than one offeree. Upon
consummation of any such sale, Administrative Agent shall have the right to assign,
transfer, and deliver to the purchaser or purchasers thereof the Collateral so sold. Each
such purchaser at any such sale shall hold the property sold absolutely free from any claim
or right on the part of Pledgor, and Pledgor hereby waives (to the extent permitted by law)
all rights of redemption, stay, and/or appraisal that Pledgor now has or may at any time in
the future have under any rule of law or statute now existing or hereafter enacted. To the
extent that notice of sale shall be required to be given by law, Administrative Agent shall
give Pledgor at least ten (10) days’ prior written notice of its intention to make any such
public or private sale. Such notice shall state the time and place fixed for sale, and the
Collateral, or portion thereof, to be offered for sale. Any such sale shall be held at such
time or times within ordinary business hours and at such place or places as Administrative
Agent may fix in the notice of such sale. At any such sale, the Collateral, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate parcels, as
Administrative Agent may determine, and Administrative Agent may itself bid (which bid may
be in whole or in part in the form of cancellation of the Obligations) for and purchase the
whole or any part of the Collateral. Administrative Agent shall not be obligated to make
any sale of the Collateral if it shall determine not to do so, regardless of the fact that
notice of sale of the Collateral may have been given. Administrative Agent may, without
notice or publication, adjourn any public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so adjourned.
In case sale of all or any part of the Collateral is made to any Person other than the
Administrative Agent or any Lender on credit or for future delivery, the Collateral so sold
may be retained by Administrative Agent until the sale price is paid by the purchaser or
purchasers thereof. Administrative Agent shall not incur any liability in case any such
purchaser or purchasers shall fail to take up and pay for the Collateral so sold and, in
case of any such failure, such Collateral may be sold again upon like notice. Pledgor
hereby agrees that any sale or disposition of the Collateral conducted in conformity with
reasonable commercial practices of banks, insurance companies or other financial
institutions in the city and state where Administrative Agent is located in disposing of
property similar to the Collateral shall be deemed to be commercially reasonable.
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(c) Pledgor recognizes that the Administrative Agent and Secured Parties may be unable
to effect a public sale of all or part of the Collateral by reason of certain prohibitions
contained in the Securities Act of 1933, as amended, and applicable state securities laws
but may be compelled to resort to one or more private sales to a restricted group of
purchasers who will be obligated to agree, among other things, to acquire all or a part of
the Collateral for their own account, for investment, and not with a view to the
distribution or resale thereof. Pledgor acknowledges and agrees that any private sale so
made may be at prices and on other terms less favorable to the seller than if such
Collateral were sold at public sale and that the Administrative Agent has no obligation to
delay the sale of such Collateral for the period of time necessary to permit the
registration of such Collateral for public sale under any securities laws. Pledgor agrees
that a private sale or sales made under the foregoing circumstances shall not be deemed to
have not been made in a commercially reasonable manner solely as a result of being a private
sale. If any consent, approval, or authorization of any federal, state, municipal, or other
governmental department, agency, or authority should be necessary to effectuate any sale or
other disposition of the Collateral, or any partial sale or other disposition of the
Collateral, Pledgor will execute all applications and other instruments as may be required
in connection with securing any such consent, approval, or authorization and will otherwise
use its best efforts to secure the same. In addition, if the Collateral is disposed of
pursuant to Rule 144, Pledgor agrees to complete and execute a Form 144, or comparable
successor form, at the Administrative Agent’s request; and Pledgor agrees to provide any
material adverse information in regard to the current and prospective operations of each
Pledged Entity of which Pledgor has knowledge and which has not been publicly disclosed, and
Pledgor hereby acknowledge that Pledgor’s failure to provide such information may result in
criminal and/or civil liability.
SECTION 7. Application of Proceeds of Sale. The proceeds of sale of the Collateral
sold pursuant to Section 6 hereof shall be applied by Administrative Agent as set forth in Section
6.04 of the Credit Agreement.
SECTION 8. Administrative Agent Appointed Attorney-in-Fact. Each Pledgor hereby
appoints Administrative Agent as Pledgor’s attorney-in-fact, effective during the continuance of an
Event of Default, with full power of substitution, for the purpose of carrying out the provisions
of this Agreement and taking any action and executing any instrument that Administrative Agent may
deem necessary or advisable to accomplish the purposes hereof, which appointment is coupled with an
interest and is irrevocable. Without limiting the generality of the foregoing, after the
occurrence and during the continuance of an Event of Default, Administrative Agent shall have the
right and power to receive, endorse, and collect all checks and other orders for the payment of
money made payable to any Pledgor representing any dividend or other distribution payable or
distributable in respect of the Collateral or any part thereof, and to give full discharge for
same.
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SECTION 9. Responsibility. Notwithstanding the provisions of Section 4(b) hereof,
Administrative Agent shall have no duty to exercise any voting and/or other consensual rights and
powers becoming vested in Administrative Agent with respect to the Collateral or any part thereof,
to exercise any right to redeem, convert, or exchange any securities included in the Collateral, to
enforce or see to the payment of any dividend or any other distribution payable or distributable on
or with respect to the Collateral or any part thereof, or otherwise to preserve any rights in
respect of the Collateral against any third parties.
SECTION 10. No Waiver; Cumulative Remedies. No failure on the part of Administrative
Agent to exercise, and no delay in exercising, any right, power, or remedy hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy by
Administrative Agent preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All remedies of Administrative Agent hereunder are cumulative and are not
exclusive of any other remedies available to Administrative Agent at law or in equity.
SECTION 11. Termination. This Agreement shall terminate upon the complete performance
of each Loan Party’s obligations under each Loan Document and the final and indefeasible payment in
full of the Obligations. Upon termination of this Agreement, Administrative Agent shall reassign
and redeliver (or cause to be reassigned or redelivered) to Pledgor such Collateral (if any) as
shall not have been sold or otherwise applied by Administrative Agent pursuant to the terms hereof
and as shall still be held by it hereunder together with appropriate instruments of assignment and
release.
SECTION 12. Notices. Any notice or communication required or permitted hereunder
shall be given in the manner prescribed in the Credit Agreement to such Person at its address set
forth in the Credit Agreement or on Schedule I to this Agreement.
SECTION 13. Further Assurances. Each Pledgor agrees to do such further acts and
things, and to execute and deliver such agreements and instruments, as Administrative Agent may at
any time reasonably request in connection with the administration or enforcement of this Agreement
or related to the Collateral or any part thereof or in order better to assure and confirm unto
Administrative Agent and the Secured Parties their rights, powers and remedies hereunder. Each
Pledgor hereby authorizes Administrative Agent to file one or more Uniform Commercial Code
financing or continuation statements, or amendments thereto, relative to all or any part of the
Collateral. Each Pledgor will execute and deliver to the Administrative Agent (or to the Collateral
Custodian as its agent and bailee) all assignments, endorsements, powers, hypothecations, and other
documents required at any time and from time to time by the Administrative Agent with respect to
the Collateral in order to effect the purposes of this Agreement. If any Pledgor shall become
entitled to receive or shall receive with respect to the Collateral any: (i) certificate
(including, but without limitation, any certificate representing a dividend or a distribution in
connection with any increase or reduction of capital, reclassification, merger, consolidation, sale
of assets, combination of shares, stock split, spin-off or split-off); (ii) option, warrant or
right, whether as an addition to, in substitution of, in exchange for the Collateral, or otherwise;
(iii) dividends or distributions payable in property, including, without limitation, securities
issued by any person other than the issuer of the Collateral; or (iv) dividends or distributions on
dissolution, or in partial or total liquidation, or from capital, capital surplus, or paid-in
surplus, then, Pledgor shall accept any such instruments or distributions as the Administrative
Agent’s agent, shall receive them in trust for the Administrative Agent, and shall deliver them
forthwith to the Administrative Agent (or to the Collateral Custodian as its agent and bailee) in
the exact form received with, as applicable, Pledgor’s endorsement when necessary or appropriate
undated stock or bond powers duly executed in blank, to be held by the Administrative Agent (or to
the Collateral Custodian as its agent and bailee), subject to the terms hereof, as further
collateral security for the Obligations.
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SECTION 14. Binding Agreement. This Agreement and the terms, covenants, and
conditions hereof, shall be binding upon and inure to the benefit of the parties hereto, and their
respective heirs, executors, administrators, successors and assigns.
SECTION 15. Modification. Neither this Agreement nor any provisions hereof may be
amended, modified, waived, discharged, or terminated, nor may any of the Collateral be released or
the pledge or the security interest created hereby extended, except by an instrument in writing
signed by the parties hereto.
SECTION 16. Severability. In case any lien, security interest, or other right of
Administrative Agent hereunder shall be held to be invalid, illegal, or unenforceable, such
invalidity, illegality, and/or unenforceability shall not affect any other lien, security interest,
or other right of Administrative Agent hereunder.
SECTION 17. Governing Law. This Agreement (including matters of construction,
validity, and performance) , the rights, remedies, and obligations of the parties with respect to
the Collateral to the extent not provided for herein, and all matters concerning the validity,
perfection, and the effect of non-perfection of the pledge contemplated hereby, shall be governed
by and construed in accordance with the laws of the State of North Carolina or other mandatory
applicable laws. Notwithstanding anything herein, EACH PLEDGOR AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NORTH CAROLINA AND THE UNITED STATES DISTRICT COURTS
SITTING THEREIN IN ANY ACTION TAKEN BY ADMINISTRATIVE AGENT RELATING TO THIS AGREEMENT OR ANY
PROVISIONS, RIGHTS OR REMEDIES HEREOF. EACH PLEDGOR FURTHER AGREES THAT ANY ACTION TAKEN BY
PLEDGOR RELATING TO THIS AGREEMENT OR ANY PROVISIONS, RIGHTS OR REMEDIES HEREOF SHALL BE TAKEN IN
SAID COURTS AND SHALL NOT BE TAKEN IN ANY OTHER JURISDICTION. PLEDGOR RECOGNIZES THAT THIS
COVENANT IS AN ESSENTIAL PROVISION OF THIS AGREEMENT, THE ABSENCE OF WHICH WOULD MATERIALLY ALTER
THE CONSIDERATION GIVEN BY ADMINISTRATIVE AGENT AND SECURED PARTIES TO PLEDGOR.
SECTION 18. Duties of Administrative Agent. The Administrative Agent has been
appointed by the Secured Parties pursuant to the Credit Agreement. Its duties to the Secured
Parties, powers to act on behalf of the Secured Parties, and immunity are set forth solely therein,
and shall not be altered by this Security Agreement. Any amounts realized by the Administrative
Agent hereunder shall be allocated pursuant to Section 6.04 of the Credit Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to be duly executed
and delivered as of the date first above written.
| MAIN STREET CAPITAL CORPORATION |
||||
| By: | /s/ Xxxx X. Xxxxxxx | |||
| Name: | Xxxx X. Xxxxxxx | |||
| Title: | President and Chief Financial Officer | |||
|
ADMINISTRATIVE AGENT: BRANCH BANKING AND TRUST COMPANY, as Administrative Agent for itself and the other Secured Parties |
||||
| By: | /s/ Xxxxxxx Xxxxxx | |||
| Name: | Xxxxxxx Xxxxxx | |||
| Title: | Vice President | |||
00
|
XXXX XXXXXX EQUITY INTERESTS, INC. |
||||
| By: | /s/ Xxxxxx Xxxxx | |||
| Xxxxxx Xxxxx | ||||
| Vice President | ||||
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