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Exhibit 4.8
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "AGREEMENT") is made as of October
4, 2000, between Unifrax Holding Co., a Delaware corporation ("HOLDINGS"), and
Societe Europeenne de Produits Refractaires, a French corporation ("SEPR").
A. Holdings has executed that certain Limited Recourse Promissory
Note, dated the date hereof, in the original principal amount of $20,200,000 in
favor of SEPR (the "HOLDINGS NOTE") and that certain Limited Recourse Promissory
Note, dated the date hereof, in the original principal amount of $300,000 in
favor of Carborundum do Brasil (the "BRASIL NOTE", and together with the
Holdings Note, the "NOTES") as partial consideration for the transactions
contemplated by that certain Stock and Asset Purchase Agreement by and among
SEPR, Unifrax Corporation (the "CORPORATION"), and certain other parties thereto
dated July 27, 2000 (the "PURCHASE AGREEMENT"); and
B. As a consequence of the transactions contemplated by the
Purchase Agreement, Holdings has acquired 20,500 shares of Series A Preferred
Stock (the "SHARES") of the Corporation, and desires to pledge the Shares to
SEPR as security for the Notes.
NOW, THEREFORE, in consideration of the premises contained
herein and other good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, Holdings and SEPR hereby agree as follows:
1. PLEDGE. Holdings hereby pledges to SEPR, and grants to SEPR
a security interest in, the Shares (together with such other securities or
property as become subject to the pledge hereunder pursuant to the terms hereof,
the "PLEDGED SHARES") as security for the prompt and complete payment when due
of the unpaid principal of and interest on the Notes and full payment and
performance of the obligations and liabilities of Holdings hereunder.
2. DELIVERY OF PLEDGED SHARES. Upon the execution of this
Agreement, Holdings shall deliver to SEPR the certificates representing the
Pledged Shares and a duly executed irrevocable stock power in the form set forth
at EXHIBIT A.
3. VOTING RIGHTS; CASH DIVIDENDS. Notwithstanding anything to
the contrary contained herein, during the term of this Agreement until such time
as there exists an Event of Default (as defined below), Holdings is entitled to
all voting rights with respect to the Pledged Shares and is entitled to receive
all cash dividends declared or paid in respect of the Pledged Shares; provided
that no vote shall be cast or any consent, waiver or ratification given or any
action taken which would, in any material respect, violate or be inconsistent
with any of the terms of this Agreement, or the Notes, or which would have the
effect of impairing, in any material respect, the position or interests of SEPR.
If an Event of Default shall occur and be continuing, all rights of Holdings to
vote and to give consents, waivers and ratifications shall cease and SEPR shall
have all such rights. In accepting the pledge of the Pledged Shares hereunder,
SEPR agrees to abide by and honor all of the terms and provisions of the Pledged
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Shares, including all such terms and provisions set forth in the Corporation's
Certificate of Amendment of the Certificate of Incorporation, dated October 4,
2000.
4. STOCK DIVIDENDS; DISTRIBUTIONS, ETC. If Holdings becomes
entitled to receive or receives any securities or other property (other than
cash) with respect to, in substitution of, or in exchange for, any of the
Pledged Shares (whether as a distribution in connection with any
recapitalization, reorganization or reclassification, a stock dividend or
otherwise), Holdings shall accept such securities or other property on behalf of
and for the benefit of SEPR as additional security for Holdings' obligations
under the Notes and shall promptly deliver such additional security to SEPR
together with a duly executed irrevocable stock power, and such additional
security will be deemed to be part of the Pledged Shares hereunder.
5. DEFAULT.
(a) In the event that any Event of Default (as defined below)
occurs under either of the Notes and is continuing, SEPR will be
entitled to exercise all of the rights, powers and remedies (whether
vested in it by this Agreement or by law) for the protection and
enforcement of its rights in respect of the Pledged Shares, including
without limitation, to exercise the following rights, which Holdings
hereby acknowledges are commercially reasonable:
(i) to receive all amounts payable in respect of the
Pledged Shares otherwise payable to Holdings;
(ii) to transfer all or any part of the Pledged
Shares into SEPR's name or the name of its nominee or
nominees;
(iii) to vote all or any part of the Pledged Shares
(whether or not transferred into the name of SEPR) and give
all consents, waivers and ratifications in respect of the
Pledged Shares and otherwise act with respect thereto as
though it were the outright owner thereof (Holdings hereby
irrevocably constituting and appointing SEPR the proxy and
attorney-in-fact of Holdings, with full power of substitution
to do so); and
(iv) to the fullest extent permitted by law, at any
time or from time to time, to sell, assign and deliver, or
grant options to purchase, all or any part of the Pledged
Shares, or any interest therein, at any public or private
sale, without demand of performance, advertisement or notice
of intention to sell or of the time or place of sale or
adjournment thereof or to redeem or otherwise dispose of or
realize on (all of which are hereby waived by Holdings) for
cash, on credit or for other property, for immediate or future
delivery without any assumption of credit risk, and for such
price or prices and on such terms as SEPR in its absolute
discretion may determine. Holdings agrees that each purchaser
at any such sale shall hold the property so sold absolutely
free from any claim or right on the part of Holdings, and
Holdings hereby waives and releases to the fullest extent
permitted by law any right of redemption with respect to the
Pledged Shares,
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whether before or after sale hereunder, and all rights, if
any, of marshaling the Pledged Shares and all rights, if any,
of stay and/or appraisal that it now has or may at any time in
the future have under rule of law or statute now existing or
hereafter enacted.
(b) Upon completion of foreclosure on the Pledged Shares in
accordance with the Uniform Commercial Code of Delaware, (i) the Notes
will be cancelled and be of no further force and effect, (ii) SEPR and
Carborundum do Brasil shall deliver to Holdings such canceled Notes,
and (iii) SEPR shall execute a signature page to the Stockholders
Agreement, by and among the Corporation and its stockholders and by
virtue of such signature shall agree to be bound by the terms of such
agreement.
(c) The term "Event of Default" as used in this Agreement has
the meaning set forth in the Notes and further includes any act or
failure to act by Holdings the result of which is that there does not
exist, or that there ceases to exist, a valid and perfected security
interest under this Agreement in all or any part of the Pledged Shares.
6. UNDERTAKING TO DEFEND. Holdings shall use its reasonable
best efforts to defend SEPR's right, title and security interest in and to the
Pledged Shares and the respective proceeds thereof against the claims and
demands of all persons.
7. COSTS AND ATTORNEYS' FEES. All reasonable costs and
reasonable expenses (including reasonable attorneys' fees) incurred in
exercising any right, power or remedy conferred by this Agreement or in the
enforcement thereof, will become part of the indebtedness secured hereunder and
will be paid by Holdings or repaid from the proceeds of the sale of the Pledged
Shares hereunder.
8. PAYMENT OF INDEBTEDNESS AND RELEASE OF PLEDGED SHARES. Upon
payment in full of the indebtedness evidenced by the Notes, including all
amounts in respect of principal and interest, this Agreement will terminate and
SEPR shall surrender the Pledged Shares to Holdings together with the
irrevocable stock power.
9. NO OTHER LIENS; NO SALES OR TRANSFERS. Holdings hereby
represents and warrants that it has good and valid title to all of the Pledged
Shares, free and clear of all liens, security interests and other encumbrances
(other than security interests or other encumbrances granted pursuant to this
Agreement), and Holdings hereby covenants that until such time as all of the
outstanding principal of and interest on the Notes has been repaid, Holdings
shall not (i) create, incur, assume or suffer to exist any pledge, security
interest, encumbrance, lien or charge of any kind against the Pledged Shares or
Holdings' rights as a holder thereof, other than pursuant to this Agreement, or
(ii) sell or otherwise transfer any Pledged Shares or any interest therein.
10. FURTHER ASSURANCES. At any time and from time to time upon
the written request of SEPR, Holdings shall execute and deliver such further
documents (including Uniform Commercial Code financing statements) and take such
further actions as SEPR may reasonably request to evidence, confirm, perfect and
maintain the liens granted or required to be granted to
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SEPR by this Agreement and the Notes, and shall fully cooperate with SEPR and
perform all additional acts that are necessary to effect the purposes of the
foregoing.
11. REPRESENTATIONS AND WARRANTIES. Holdings hereby represents
and warrants to SEPR that on the date hereof:
(a) Holdings has the right in and good title to the Pledged
Shares and has full right, power and authority to pledge the Pledged
Shares pursuant to this Agreement and to execute, deliver and perform
its obligations in accordance with the terms of this Agreement, without
the consent or approval of any other person.
(b) SEPR has a valid and enforceable security interest in all
of the Pledged Shares and a first priority perfected security interest
in the Pledged Shares.
(c) This Agreement has been duly executed and delivered by
Holdings and constitutes the legal, valid and binding obligation of
Holdings, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency and similar laws affecting creditors'
rights generally and to general principles of equity.
(d) Neither Holdings' execution, delivery or performance of
this Agreement or the Notes, nor, subject to the terms and provisions
of the Subordination Agreement by and among SEPR, the Corporation and
certain lenders, dated as of October __, 2000, SEPR's exercise of any
of its rights and remedies with respect to this Agreement or the Notes,
will violate or conflict with the terms of any agreement to which
Holdings is a party, or will violate or conflict with any law, rule,
provision, policy or order applicable to Holdings or the Pledged
Shares.
12. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction will, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction will not invalidate or render unenforceable
such provision in any other jurisdiction.
13. NO WAIVER; CUMULATIVE REMEDIES. SEPR shall not by any act,
delay, omission or otherwise be deemed to have waived any of its rights or
remedies hereunder, and no waiver will be valid unless in writing, signed by
SEPR, and then only to the extent therein set forth. A waiver by SEPR of any
right or remedy hereunder on any one occasion will not be construed as a bar to
any right or remedy which SEPR would otherwise have on any future occasion. No
failure to exercise nor any delay in exercising on the part of SEPR, any right,
power or privilege hereunder will preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and remedies
herein provided are cumulative and may be exercised singly or concurrently, and
are not exclusive of any rights or remedies provided by law.
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14. WAIVERS, AMENDMENTS; ASSIGNMENT. None of the terms or
provisions of this Agreement may be waived, altered, modified or amended except
by an instrument in writing, duly executed by the parties hereto. This Agreement
and all obligations of Holdings hereunder, together with the rights and remedies
of SEPR hereunder, inure to the benefit of SEPR and its successors. SEPR shall
not assign, negotiate or otherwise transfer this Agreement or any or all of its
rights under this Agreement to any person or entity without the prior written
consent of Holdings, except to an Affiliate of SEPR.
15. GOVERNING LAW. This Agreement is to be governed and
controlled as to interpretation, enforcement, validity, construction, and in all
other respects by the laws, statutes and decisions of the State of New York.
16. COUNTERPARTS. This Agreement may be executed in two or
more counterparts (including by facsimile), each of which is deemed to be an
original and all of which taken together constitute one and the same Agreement.
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IN WITNESS WHEREOF, this Agreement has been executed as of the
date first above written.
SOCIETE EUROPEENNE DE
PRODUITS REFRACTAIRES
By: /S/ XXXXXX XXXXXX
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Name: Xxxxxx Xxxxxx
Title: Senior Vice President Finance
UNIFRAX HOLDING CO.
By: /S/ XXXXXXX X. XXXXX
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Name: Xxxxxxx X. Xxxxx
Title: President and CEO
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EXHIBIT A
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EXHIBIT A
IRREVOCABLE STOCK POWER
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FOR VALUE RECEIVED, Unifrax Holding Co. hereby sells, assigns and
transfers unto _____________ 20,500 shares of Series A preferred stock $0.01 par
values of Unifrax Corporation, a Delaware corporation (the "CORPORATION"),
standing in the name of Unifrax Holding Co. on the books of the Corporation
represented by Certificate No. 1 herewith, and does hereby irrevocably
constitute and appoint ___________ to transfer said stock on the books of said
Corporation and to substitute one or more persons with like full power, hereby
ratifying and confirming all that said agent or substitute or substitutes shall
lawfully do by virtue hereof. This Stock Power is coupled with an interest and
is irrevocable.
Dated: October 4, 2000
UNIFRAX HOLDING Co.
/s/Xxxxxxx X. Xxxxx
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By: Xxxxxxx X. Xxxxx
Title: President
ATTEST:
By: /s/Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Assistant Secretary
