Exhibit 10.10
SECURITY AND STOCK PLEDGE AGREEMENT
This Security and Stock Pledge Agreement effective as of November 1, 1998 by
and between Xxxxx Xxxxx ("Borrower") and TomaHawk II Inc. ("Lender").
In consideration of the mutual terms, conditions and covenants herein under set
forth, Borrower and Lender agree as follows:
(1) In exchange of consideration stated in seven Promissory Notes aggregating
the sum of Seven Hundred Thirty Five Thousand Two Hundred and Ninety Five
Dollars ($735,295) all of which were consolidated in a Consolidated
Promissory Note, Borrower agrees to provide as security shares of stock of
the Tomahawk Corporation, which are evidenced and represented by the
following Stock Certificates for the number of shares identified and for
the following sums of money as herein identified.
(a) Certificate C00722, No. of Shares 137,700, Amount $33,154
(b) Certificate C00724, No. of Shares 653,750, Amount $109,765
(c) Certificate C00679, No. of Shares 1,275,000, Amount $50,000
(d) Certificate C00767, No. of Shares 105,146, Amount $13,049
(e) Certificate C00879, No. of Shares 544,040, Amount $53,751
(f) Certificate C00891, No. of Shares 2,500,000, Amount $293,250
(g) Certificate C01091, No. of Shares 1,275,000, Amount $182,325
(2) As security for the loan, evidenced in the accompanying Consolidated
Promissory Note, Borrower hereby pledges, assigns, transfers and grants to
Lender a security interest in the number of shares as listed in the
preceding paragraph.
(3) In furtherance of the pledge, assignment, transfer and grant of the
security interest, Borrower shall, and has, delivered to Lender the number
of shares as listed in paragraph (1) of this agreement as evidenced and
represented by Stock Certificate Nos. C00722, C00724, C00679, C00767,
C00879, C00891, C01091.
(4) Borrower shall not pledge, borrow against, collaterize against,
hypothecate, assign, transfer, sell or in any other manner diminish or
impair the value of the stock pledged or the security interest without the
express written authorization of the Lender.
(5) During the term of this agreement, which shall run contemporaneously with
the accompanying Consolidated Promissory Note, the Borrower shall own the
pledged shares. The pledged stock shall be held in trust by Lender for
SECURITY AND STOCK PLEDGE AGREEMENT PAGE 2 (XXXXX XXXXX)
Borrower in a safe place and Lender shall not alienate, transfer, assign,
hypothecate, sell, pledge, or in any other manner dispose of, or impair
the value of the pledged stock until such time as the Borrower is in
default of the accompanying Consolidated Promissory Note. Lender shall
return the security pledged in this agreement to Borrower upon the
compliance within the terms contained in the accompanying Consolidated
Promissory Note. Upon default and after exhausting efforts to sell the
stock as referenced in paragraph 6 of this agreement, the Lender and/or
Borrower, depending upon which party is in possession, shall return any
unsold shares to the Tomahawk Corporation.
(6) If in default under the terms of this agreement or the accompanying
Consolidated Promissory note is not paid when due, Lender shall be
deemed the owner of the stock described above and Borrower hereby
consents to the transfer to he stock to Lender without further notice.
The foregoing notwithstanding, at any time Borrower seeks to sell the
stock pledged under this agreement, the parties agree to cooperate
reasonably and in good faith to arrange a sale of that portion of the
shares of stock pledged under this agreement as is reasonably
appropriate to raise funds necessary to satisfy Borrower's obligation.
Borrower agrees that all proceeds from the sale of pledged stock shall
first be applied to satisfy Borrowers obligation under the Consolidated
Promissory Note. It is expressly understood that to the extent that the
stock secured and pledged by this agreement upon sale does not satisfy
the debt, the Borrower is not liable for any deficiency. To the extent
that any balance of the shares remains after satisfaction of the debt,
such shares shall be returned to Borrower.
(7) Borrower shall have the right to exercise all voting rights to the stock
pledged.
(8) The parties may amend or modify this agreement in writing.
INTENDING TO BE LEGALLY BOUND, the parties hereto have caused this Security and
Pledge Agreement to be executed as of the date first above written.
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XXXXX XXXXX, Borrower TOMAHAWK II, INC. Lender
BY:
