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EXHIBIT 10.13
PLEDGE AGREEMENT
March 1, 1996
In consideration of the extension and refinancing of the obligations
of Pride Aviation, Inc., an Oklahoma corporation ("Debtor"), to Louisiana
Economic Development Corporation ("Secured Party"), Aviation Group, Inc., a
Texas corporation ("Owner"), hereby pledges and assigns to Secured Party, and
grants a security interest to Secured Party in, the property described below
belonging to (or an interest in which belongs to) Owner:
1. Certificate No. 22 representing 5,015 shares of the
voting common stock of Pride Aviation, Inc., an Oklahoma corporation ("Pride"),
being approximately 50.15% of the capital stock of Pride that is issued and
outstanding; and
2. All dividends and distributions on or other rights in
connection with such property, and all proceeds from the sale of such property.
Collectively all such stock and other assets hereinafter are called the
"Collateral". The stock certificate listed above hereby is delivered to
Secured Party, along with a corresponding stock power appropriately executed in
blank.
The security interests granted herein are to secure the following (all
of which is hereinafter called the "Obligations"):
(a) All debts and obligations of Debtor to Secured Party
evidenced by that certain Amended and Restated Promissory Note in the original
principal amount of $407,689.77 made payable to the order of Secured Party by
Debtor together with any and all renewals, extensions, and refinancings of, and
modifications and additions to, the foregoing (the "Note"); and
(b) All costs incurred by Secured Party to obtain,
preserve, perfect and enforce the security interests herein granted, collect
the Obligations, and maintain, preserve, collect and enforce the Collateral,
and including but not limited to reasonable attorneys' fees and expenses of
sale.
Cash dividends on any of the Collateral shall continue to be paid to
the Owner unless Debtor defaults in the payment of any Obligations, in which
event Secured Party is authorized to collect and apply such cash dividends in
reduction of the Obligations. Any liquidating distributions and any additional
securities or other property issued or distributed with respect to any of the
Collateral, including all or any dividends, exchanges, or substitutions, shall
be pledged as additional collateral hereunder, shall be delivered to Secured
Party, and shall constitute "Collateral" as that term is defined herein.
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Upon the occurrence of a default under the Note (after any notice and
cure period specified therein), Secured Party is entitled to foreclose on the
Collateral and in such event Secured Party shall have:
(1) All remedies and rights available under the Texas
Business and Commerce Code and other applicable laws; and
(2) All remedies and rights under the Note.
Unless the property pledged hereunder threatens to decline speedily in
value or is of a type customarily sold on a recognized market, Secured Party
will give Owner reasonable notice of the time and place of any public sale
thereof or of the time after which any private sale or any other intended
disposition thereof is to be made. The requirements of reasonable notice shall
be met if such notice is mailed, postage prepaid, to the address of Owner shown
at the end of this Agreement at least ten (10) days before the time of the sale
or disposition. The proceeds of any such sale shall be applied, first, to the
payment of all costs and expenses of collection, storage, custody, and the sale
and delivery of the Collateral, including Secured Party's reasonable attorneys'
fees and expenses in connection therewith, and next to the payment of such of
the Obligations and in such order of application as Secured Party may from time
to time elect. Any remaining surplus may be retained by Secured Party as
security hereunder until all the Obligations shall have terminated.
If, in the opinion of Secured Party, there is any question that a
public or semipublic sale or distribution of any Collateral will violate any
state or federal securities law, Secured Party in its discretion (a) may offer
and sell securities privately to purchasers who will agree to take them for
investment purposes and not with a view to distribution and who will agree to
imposition of restrictive legends on the certificates representing the
security, or (b) may sell such securities in an intrastate offering under
Section 3(a)(11) of the Securities Act of 1933, as amended, and no sale so made
in good faith by Secured Party shall be deemed to be not "commercially
reasonable" because so made. Owner shall cooperate fully with Secured Party in
all respects in selling or realizing upon all or any part of the Collateral.
Secured Party acknowledges and agrees that Owner may grant a second
priority security interest in the Collateral to Xxxxx and Xxxxx Xxxx to secure
a 10% Convertible Note made by Owner payable to Xxxxx and Xxxxx Xxxx in the
original principal amount of $507,250, which security interest shall in all
events be subject and subordinate to the security interest of Secured Party
granted herein.
No delay on the part of Secured Party in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
Secured Party of any right or remedy shall preclude other or further exercise
thereof or the exercise of any other right or remedy. No action of Secured
Party permitted hereunder shall impair or affect the rights of Secured Party in
and to the Collateral. This Agreement shall inure to the benefit of Secured
Party and its successors and assigns.
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This Agreement shall be governed by the laws of the State of Texas,
including the version of the Uniform Commercial Code adopted in such state.
OWNER:
Witnesses: AVIATION GROUP, INC.
/s/ XXX XXXXXX By: /s/ XXX XXXXXXX
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Name: Xxx Xxxxxxx
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/s/ X X XXXXXX Title: President
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Address:
0000 Xxxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 00000
SECURED PARTY:
Witnesses: LOUISIANA ECONOMIC DEVELOPMENT
CORPORATION
/s/ XXXXX X. XXXXXX By: /s/ XXXXX X. XXXXXX, XX.
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Name: Xxxxx X. Xxxxxx, Xx.
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/s/ [ILLEGIBLE] Title: President
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Louisiana Economic Development
Corporation
Address:
000 Xxxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000
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