STOCKPLEDGE AGREEMENT
Exhibit
10.21
STOCKPLEDGE
AGREEMENT
THIS
STOCK PLEDGE AGREEMENT, made as of
this 28th day of June, 2008, by and between Xxxx X. Xxxx, Grantor, under that
certain Revocable Trust Agreement dated December 19, 1989, and Xxxx X. Xxxx
and
Xxxxxxx Xxxx, Co-Trustees under said Revocable Trust Agreement (collectively
“Pledgor”) and APA Enterprises, Inc. (“Secured Party”).
IN
CONSIDERATION of the mutual covenants and promises herein contained, the Secured
Party and Pledgor agree:
1.
Security Interest. For value received, Pledgor hereby grants
Secured Party a security interest in 500,000 shares of common stock, par value
$.01 per share, of APA Enterprises, Inc. (the shares hereinafter referred to
as
the "Shares" and APA Enterprises, Inc. hereinafter referred to as the
"Company"), together with all rights related thereto. Upon payment in
full of the Indebtedness (defined below) without any Event of Default (defined
below) all Shares shall be returned to Pledgor.
2.
Obligation Secured. The Shares shall secure payment of (i) the
indebtedness evidenced by that certain Note ("Note" or the "Indebtedness")
of
even date herewith between Photonics International, Inc. and the Secured Party
which is issued pursuant to the terms of the Stock Purchase Agreement dated
June
28, 2007 (the “Stock Purchase Agreement”) and (ii) the Guaranty of the Note by
Xxxx X. Xxxx.
3.
Representations, Warranties and Agreements. Pledgor represent,
warrant and agree that:
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a.
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Pledgor
has delivered to Secured Party certificates representing the Shares,
along
with duly executed stock powers, in
blank.
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b.
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Pledgor
is the owner of the Shares free and clear of all liens, encumbrances,
security interests, restrictions on transfer and other restrictions,
except this security interest.
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c.
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Pledgor
will keep the Shares free and clear of all liens, encumbrances, security
interests and restrictions, except this security interest, will defend
the
Shares against all claims and demands of anyone other than Secured
Party,
and will not sell or otherwise dispose of the Shares or any interest
therein.
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d.
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Pledgor
will pay when due all taxes and other governmental charges levied
or
assessed upon or against any
Shares.
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e.
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The
Shares are fully paid and
non-assessable.
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f.
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Pledgor
will deliver to Secured Party in pledge as additional security any
securities distributed on account of the Shares such as stock dividends
or
securities arising from stock splits, reorganizations or
recapitalizations. This subparagraph shall not be construed to
authorize distributions if such distributions are prohibited by any
other
agreement between the parties.
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4.
Events of Default. The occurrence of any of the following
events shall constitute an Event of Default:
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a.
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Failure
by Pledgor or Photonics International, Inc. to honor or perform any
of the
terms and conditions of the Note.
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b.
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Default
by Photonics International, Inc. in the payment when due of the principal
of any Indebtedness, any installment thereto, or any interest thereon,
whether at maturity, by acceleration, or
otherwise.
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5.
Remedies in Event of Default. Upon the occurrence of an Event
of Default and at any time thereafter, Secured Party may give notice of Event
of
Default to Pledgor. If said Event of Default is not cured within
thirty (30) days after said notice is given, the entire Indebtedness shall,
at
Secured Party’s option, become immediately due and payable without notice,
presentment, demand, protest or notice of protest of any kind, all of which
are
expressly waived by Pledgor; and Secured Party may exercise and enforce with
respect to the Shares any or all rights and remedies available upon default
to a
secured party under the Uniform Commercial Code, including the right to offer
and sell the Shares privately to purchasers who will agree to take the Shares
for investment and not with a view to distribution and who will agree to the
imposition of restrictive legends on the certificates representing the Shares,
and the right to arrange for a sale which would otherwise qualify as exempt
from
registration under the Securities Act of 1933. If notice to Pledgor
of any intended disposition of the Shares or any other intended action is
required by law in a particular instance, such notice shall be deemed
commercially reasonable if given at least ten (10) calendar days prior to the
date of intended disposition or other action. Upon satisfaction of
the Indebtedness and all costs of collection and enforcement of this Agreement
and the Guaranty, any Shares remaining shall be returned to
Pledgor. Nothing in this Agreement shall abridge Secured Party’s
right to exercise or enforce any or all other rights or remedies available
to
Secured Party by law or agreement against the Shares, against Pledgor or against
any other person or property.
6.
Waiver. Pledgor waives any right that Pledgor may have to
require Secured Party to proceed against any other person, to proceed against
or
exhaust collateral or any part thereof, or to pursue any other remedy that
Secured Party may have. Pledgor consents to any and all extensions of
time, renewals, waivers or modifications of any of the terms and conditions
of
any Indebtedness that may be granted by Secured Party, to release the security
or any part thereof with or without substitution, and to the release,
substitution, or addition of any parties primarily or secondarily liable on
any
Indebtedness. Notice of any of the above is hereby waived by
Pledgor
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7.
Miscellaneous. Any disposition of the Shares in the manner
provided in Paragraph 5 shall be deemed commercially reasonable. This
Agreement can be waived, modified, amended, terminated or discharged, and this
security interest released, only explicitly in a writing signed by Secured
Party. A waiver signed by Secured Party shall be effective only in
the specific instance and for the specific purpose given. Mere delay
or failure to act shall not preclude the exercise or enforcement of any of
Secured Party’s rights or remedies. All rights and remedies of
Secured Party shall be cumulative and may be exercised singularly or
concurrently, at Secured Party’s option, and the exercise or enforcement of any
one such right or remedy shall neither be a condition to nor bar the exercise
or
enforcement of any other. All notices to be given to Pledgor shall be
deemed sufficiently given if delivered or mailed by registered or certified
mail, postage prepaid, to Pledgor at the most recent address shown on Secured
Party’s records. Secured Party’s duty of care with respect to the
Shares in its possession (as imposed by law) shall be deemed fulfilled if
Secured Party exercises reasonable care in physically safekeeping the Shares
or
exercising reasonable care in the selection of the bailee or other third person
as custodian of the Shares, and Secured Party need not otherwise preserve,
protect, insure or care for the Shares. Secured Party is not
obligated to preserve any rights Pledgor may have against prior parties, to
realize on the Shares at all or in any particular manner or order, or to apply
any cash proceeds of the Shares in any particular order of
application. Pledgor will reimburse Secured Party for all expenses
incurred in disposing of the Shares or otherwise enforcing this security
interest (including reasonable attorneys' fees and legal
expenses). This Agreement shall be binding upon and inure to the
benefit of Pledgor and Secured Party and their respective successors and
assigns. Except to the extent otherwise required by law, this
Agreement shall be governed by the internal laws of the State of Minnesota
and,
unless the context otherwise requires, all terms used herein which are defined
in Articles 1 and 9 of the Uniform Commercial Code, as in effect in said State,
shall have the meanings therein stated. If any provision or
application of this Agreement is held unlawful or unenforceable in any respect,
such illegality or unenforceability provision or application had never been
contained herein or prescribed hereby. All representations and
warranties contained in this Agreement shall survive the execution, delivery
and
performance of this Agreement and the creation and payment of the
Indebtedness.
8.
Additional Agreement. That certain Agreement to Provide
Additional Collateral, of even date herewith, is deemed to be a part of this
Agreement.
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first above written.
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Secured
Party:
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Pledgor:
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/s/
Xxxx X. Xxxx
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Xxxx
X. Xxxx, Co-Trustee and Grantor under
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By:
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/s/
Xxxxxx X. Xxxx
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Revocable
Trust Agreement dated
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Its
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Chairman
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December
19, 1989
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/s/
Xxxxxxx Xxxx
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Xxxxxxx
Xxxx, Co-Trustee under Revocable
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Trust
Agreement dated December 19, 1989
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