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EXHIBIT 10.3
BORROWER PLEDGE AND SECURITY AGREEMENT
This BORROWER PLEDGE AND SECURITY AGREEMENT, dated as of
January 22, 1997 (together with all amendments, if any, from time to time
hereto, this "Agreement") between LDM Technologies, Inc., a Michigan
corporation (the "Pledgor") in favor of BANKAMERICA BUSINESS CREDIT, INC. in
its capacity as Agent for the Lenders ("Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Loan and Security Agreement
dated as of the date hereof by and among the Pledgor, the Agent and the Persons
signatory thereto from time to time as Lenders (as from time to time amended,
restated, supplemented or otherwise modified (the "Loan and Security
Agreement") the Lenders have agreed to make Loans to, and incur Obligations
with respect to Letter of Credit issued for the benefit of, the Pledgor;
WHEREAS, the Pledgor is the record and beneficial owner of all
the shares of stock, membership interests or partnership units of each entity
(each, a "Pledged Entity") described in Part A of Schedule I hereto and the
owner of the promissory notes and instruments listed in Part B of Schedule I
hereto;
WHEREAS, the Pledgor benefits from the credit facilities made
available to the Pledgor through the Loan and Security Agreement;
WHEREAS, it is a condition to the making of Loans and the
incurrence of Obligations relating to the issuance of Letters of Credit under
the Loan and Security Agreement that the Pledgor shall have executed and
delivered this Agreement and granted the security interest contemplated hereby
to secure the obligations of the Pledgor under the Loan and Security Agreement
and the Loan Documents;
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained and to induce Lenders to make Loans and to
incur Obligations relating to the issuance of Letter of Credit under the Loan
and Security Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms
defined in the Loan and Security Agreement are used herein as therein defined,
and the following shall have (unless otherwise provided elsewhere in this
Agreement) the following respective meanings (such meanings being equally
applicable to both the singular and plural form of the terms defined):
"Bankruptcy Code" means title 11, United States Code, as amended from
time to time, and any successor statute thereto.
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"General Intangibles" means all of the Pledgor's now owned or hereafter
acquired general intangibles, choses in action and causes of action and
all other intangible personal property of the Pledgor of every kind and
nature, including, without limitation, all contract rights, partnership
or membership interests, corporate or other business records, with
respect to any Pledged Entity, excluding proceeds of key-man life
insurance on which the Pledgor is the beneficiary.
"Pledged Collateral" has the meaning assigned to such term in Section
2 hereof.
"Pledged Debt" means those promissory notes and instruments listed on
Part C of Schedule I hereto;
"Pledged Shares" means those shares listed on Part A of Schedule I
hereto.
"Secured Obligations" has the meaning assigned to such term in Section
3 hereof.
"Unobligated Shares" shall be those shares in an aggregate amount not
to exceed 35% of the issued and outstanding shares of stock of an
issuer not incorporated under the laws of the United States or any
state thereof.
2. Pledge. The Pledgor hereby pledges to the Agent, and
grants to the Agent for itself and the benefit of Lenders, a first priority
security interest in all of the following (collectively, the "Pledged
Collateral"):
(i) the Pledged Shares and the certificates representing the
Pledged Shares, and all dividends, distributions, cash, instruments
and other property or proceeds from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all
of the Pledged Shares;
(ii) such portion, as determined by the Agent as provided in
Section 6(d) below, of any additional shares of stock of a Pledged
Entity from time to time acquired by the Pledgor in any manner (which
shares shall be deemed to be part of the Pledged Shares), and the
certificates representing such additional shares, and all dividends,
distributions, cash, instruments and other property or proceeds from
time to time received, receivable or otherwise distributed in respect
of or in exchange for any or all of such shares;
(iii) the Pledged Debt and the promissory notes or instruments
evidencing the Pledged Debt, and all interest, cash, instruments and
other property and assets from time to time received, receivable or
otherwise distributed in respect of the Pledged Debt;
(iv) all additional Debt arising after the date hereof and
owing to the Pledgor and evidenced by promissory notes or other
instruments, together with such promissory notes and instruments, and
all interest, cash, instruments and other
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(iv) any change in the authorized number of shares, the
stated capital or the authorized share capital of a Pledged Entity or
the issuance of any additional shares of its Stock, units or
interests; or
(v) the alteration of the voting rights with respect to
the Stock of a Pledged Entity; and
(b)(i) The Pledgor shall be entitled, from time to time, to
collect and receive for its own use all cash dividends, principal and
interest paid in respect of the Pledged Shares, the General Intangibles
and Pledged Debt to the extent not in violation of the Loan and Security
Agreement other than any and all: (A) dividends, distributions, principal
and interest paid or payable other than in cash in respect of any Pledged
Collateral, and instruments and other property received, receivable or
otherwise distributed in respect of, or in exchange for, any Pledged
Collateral; (B) dividends and other distributions paid or payable in cash
in respect of any Pledged Shares or General Intangibles in connection with
a partial or total liquidation or dissolution or in connection with a
reduction of capital, capital surplus or paid-in capital of a Pledged
Entity; and (C) cash paid, payable or otherwise distributed, in respect of
principal of, or in redemption of, or in exchange for, any Pledged
Collateral, except to the extent permitted by the Loan and Security
Agreement; provided, however, that until actually paid all rights
to such distributions shall remain subject to the Lien created by this
Agreement; and
(ii) all dividends, distributions and interest (other than
such cash dividends, distributions and interest as are permitted to be
paid to the Pledgor in accordance with clause (i) above) and all other
distributions in respect of any of the Pledged Shares, General Intangibles
or Pledged Debt, whenever paid or made, shall be delivered to the Agent
to hold as Pledged Collateral and shall, if received by the Pledgor, be
received in trust for the benefit of the Agent, be segregated from the
other property or funds of the Pledgor, and be forthwith delivered to the
Agent as Pledged Collateral in the same form as so received (with any
necessary indorsement).
8. Defaults and Remedies.
(a) Upon the occurrence of an Event of Default and during the
continuation of such Event of Default, then on or at any time after such
declaration (provided that such declaration is not rescinded by the Agent)
and concurrently with written notice to the Pledgor, the Agent (personally
or through an agent) is hereby authorized and empowered to transfer and
register in its name or in the name of its nominee the whole or any part
of the Pledged Collateral, to exchange certificates or instruments
representing or evidencing Pledged Collateral for certificates or
instruments of smaller or larger denominations, to exercise the voting and
all other rights as a stockholder with respect thereto, to collect and
receive all cash dividends, interest, principal and other distributions
made thereon, to sell in one or more sales after ten (10) days' notice of
the time and place of any public sale or of the time at which a private
sale is to take place (which notice the Pledgor agrees is commercially
reasonable) the whole or any part of the Pledged Collateral and to
otherwise act with respect
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to the Pledged Collateral as though the Agent was the outright owner
thereof, the Pledgor hereby irrevocably constituting and appointing the
Agent as the proxy and attorney-in-fact of the Pledgor, with full power of
substitution to do so, and which appointment shall remain in effect until
the Pledge Termination Date; provided, however, that Agent shall not have
any duty to exercise any such right or to preserve the same and shall
not be liable for any failure to do so or for any delay in doing so. Any
sale shall be made at a public or private sale at the Agent's place of
business, or at any place to be named in the notice of sale, either for
cash or upon credit or for future delivery at such price as the Agent may
deem fair, and the Agent may be the purchaser of the whole or any part of
the Pledged Collateral so sold and hold the same thereafter in its own
right free from any claim of the Pledgor or any right of redemption. Each
sale shall be made to the highest bidder, but the Agent reserves the right
to reject any and all bids at such sale which, in its discretion, it shall
deem inadequate. Demands of performance, except as otherwise herein
specifically provided for, notices of sale, advertisements and the
presence of property at sale are hereby waived and any sale hereunder may
be conducted by an auctioneer or any officer or agent of the Agent.
(b) If, at the original time or times appointed for the
sale of the whole or any part of the Pledged Collateral, the highest bid,
if there be but one sale, shall be inadequate to discharge in full all the
Secured Obligations, or if the Pledged Collateral be offered for sale in
lots, if at any of such sales, the highest bid for the lot offered for
sale would indicate to the Agent, in its discretion, that the proceeds of
the sales of the whole of the Pledged Collateral would be unlikely to be
sufficient to discharge all the Secured Obligations, the Agent may, on one
or more occasions and in its discretion, postpone any of said sales by
public announcement at the time of sale or the time of previous
postponement of sale, and no other notice of such postponement or
postponements of sale need be given, any other notice being hereby waived;
provided, however, that any sale or sales made after such postponement
shall be after ten (10) days' notice to the Pledgor.
(c) If, at any time when the Agent in its sole discretion
determines, following the occurrence and during the continuance of an Event of
Default, that, in connection with any actual or contemplated exercise of its
rights (when permitted under this Section 8) to sell the whole or any part of
the Pledged Shares hereunder, it is necessary or advisable to effect a public
registration of all or part of the Pledged Collateral pursuant to the
Securities Act of 1933, as amended (or any similar statute then in effect) (the
"Act"), the Pledgor shall, in an expeditious manner, cause the Pledged Entities
to:
(i) Prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement with respect to the
Pledged Shares and in good faith use commercially reasonable efforts to
cause such registration statement to become and remain effective;
(ii) Prepare and file with the Commission such
amendments and supplements to such registration statement and the
prospectus used in connection therewith as may be necessary to keep such
registration statement effective and to comply with the provisions of the
Act with respect to the sale or other disposition of
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
LDM TECHNOLOGIES, INC.
By: /s/ Xxx Xxxxxx
------------------------------
Name: Xxx Xxxxxx
------------------------
Title: Secretary
-----------------------
Accepted and Acknowledged by:
BANKAMERICA BUSINESS CREDIT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
-------------------------
Title: Senior Vice President
------------------------
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SCHEDULE I
PART A
PLEDGED SHARES
Class Number
of Stock/ of Shares/
Interests/ Stock Certificate Interests/ Percentage of
Pledged Entity Units Number(s) Units Outstanding Shares
-------------- ----------- ----------------- ---------- ------------------
LDM Holdings, L.L.C. 66.67%
LDM Canada Limited 97.00%
Partnership
PART B
UNOBLIGATED SHARES
Class Stock Certificate Number Percentage of
Pledged Entity of Stock Number(s) of Shares Outstanding Shares
-------------- -------- ----------------- --------- ------------------
PART C
PLEDGED DEBT
Initial
Issuer Principal Amount Issue Date Maturity Date Interest Rate
------- ---------------- ---------- ------------- -------------
LDM Technologies Company $27,000,000 January 22, 1997 Demand 11%, subject
to adjustment
based upon
annual review.
Pledged Debt is subordinated to the Secured Obligations.
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SCHEDULE II
PLEDGE AMENDMENT
This Pledge Amendment, dated ________________, ___ is
delivered pursuant to Section 6(d) of the Pledge Agreement referred to below.
The undersigned hereby certifies that the representations and warranties in
Section 5 of the Pledge Agreement are and continue to be true and correct,
both as to the promissory notes, instruments and shares pledged prior to this
Pledge Amendment and as to the promissory notes, instruments and shares pledged
pursuant to this Pledge Amendment. The undersigned further agrees that this
Pledge Amendment may be attached to that certain Pledge Agreement, dated
January __, 1997, between undersigned, as the Pledgor, and BankAmerica Business
Credit, Inc., as the Agent, and that the Pledged Shares and Pledged Debt listed
on this Pledge Amendment shall be and become a part of the Pledged Collateral
referred to in said Pledge Agreement and shall secure all Secured Obligations
referred to in said Pledge Agreement. The undersigned acknowledges that any
promissory notes, instruments or shares not included in the Pledged Collateral
at the discretion of the Agent may not otherwise be pledged or otherwise used
as security by the Pledgor.
LDM TECHNOLOGIES, INC.
By:_________________________________
Name: ___________________________
Title: __________________________
Name and Class Certificate Number
Address of the Pledgor Pledged Entity of Stock Number(s) of Shares
---------------------- -------------- -------- ---------- ---------
Initial
Issuer Principal Amount Issue Date Maturity Date Interest Rate
-------------- ---------------- ---------- ------------- --------------
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SCHEDULE III
ACKNOWLEDGMENT OF SECURITY INTEREST
[NAME OF PLEDGED ENTITY] (the "Company") hereby acknowledges
receipt of a copy of the assignment by LDM Technologies, Inc., (the "Pledgor")
of its interest under the [TITLE OF AGREEMENT] (the "Agreement") pursuant to
the terms of the Pledge and Security Agreement, dated as of January __, 1997
(the "Pledge Agreement"), between the Pledgor and BankAmerica Business Credit,
Inc., as Agent.
The undersigned hereby further confirms the registration of
the Pledgor's pledge of its interest in the Company to the Agent on the
Company's books.
The Company agrees that at any time prior to the Pledge
Termination Date (as defined in the Pledge Agreement), it will not take or
approve any action in furtherance of deeming the interests of the Company to be
an uncertificated "security" within the meaning of Section 8-103(c) of the
UCC (as defined in the Pledge Agreement) and that its membership or partnership
interest shall at all times be general intangibles under the UCC.
Dated:_______________________, 1997 [NAME OF PLEDGED ENTITY]
By:____________________________
Title:______________________
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LDM HOLDING PLEDGE AND SECURITY AGREEMENT
This LDM HOLDING PLEDGE AND SECURITY AGREEMENT, dated as of
January 22, 1997 (together with all amendments, if any, from time to time
hereto, this "Agreement") between LDM Holding Canada, Inc., a Michigan
corporation (the "Pledgor") in favor of BANKAMERICA BUSINESS CREDIT, INC. in
its capacity as Agent for the Lenders ("Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Guarantee, dated as of
January 22 , 1997 (the "LDM Holding Guarantee"), made by the Pledgor, the
Pledgor has provided a guarantee of the payment of the Obligations under the
Loan and Security Agreement dated as of January 22, 1997, by and among the
Pledgor, the Agent and the Persons signatory thereto from time to time as
Lenders (as from time to time amended, restated, supplemented or otherwise
modified (the "Loan and Security Agreement") the Lenders have agreed to make
Loans to, and incur Obligations with respect to Letter of Credit issued for the
benefit of, the Pledgor;
WHEREAS, the Pledgor is the record and beneficial owner of all
the shares of stock and membership interests of each entity (each, a "Pledged
Entity") described in Schedule I hereto;
WHEREAS, the Pledgor benefits from the credit facilities made
available to the Borrower through the Loan and Security Agreement;
WHEREAS, it is a condition to the making of Loans and the
incurrence of Obligations relating to the issuance of Letters of Credit under
the Loan and Security Agreement that the Pledgor shall have executed and
delivered this Agreement and granted the security interest contemplated hereby
to secure the obligations of the Pledgor under the LDM Holding Guarantee;
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained and to induce Lenders to make Loans and to
incur Obligations relating to the issuance of Letter of Credit under the Loan
and Security Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms
defined in the Loan and Security Agreement are used herein as therein defined,
and the following shall have (unless otherwise provided elsewhere in this
Agreement) the following respective meanings (such meanings being equally
applicable to both the singular and plural form of the terms defined):
"Bankruptcy Code" means title 11, United States Code, as
amended from time to time, and any successor statute thereto.
"General Intangibles" means all of the Pledgor's now owned or
hereafter acquired general intangibles, choses in action and causes
of action and all other intangible personal
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property of the Pledgor of every kind and nature, including, without
limitation, all contract rights, membership interests, corporate or
other business records, with respect to any Pledged Entity.
"Pledged Collateral" has the meaning assigned to such term in
Section 2 hereof.
"Pledged Shares" means those shares listed on Schedule I
hereto.
"Secured Obligations" has the meaning assigned to such term
in Section 3 hereof.
2. Pledge. The Pledgor hereby pledges to the Agent, and
grants to the Agent for itself and the benefit of Lenders, a first priority
security interest in all of the following (collectively, the "Pledged
Collateral"):
(i) the Pledged Shares and the certificates
representing the Pledged Shares, and all dividends,
distributions, cash, instruments and other property or
proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the
Pledged Shares;
(ii) such portion, as determined by the Agent as
provided in Section 6(d) below, of any additional shares of
stock of a Pledged Entity from time to time acquired by the
Pledgor in any manner (which shares shall be deemed to be part
of the Pledged Shares), and the certificates representing such
additional shares, and all dividends, distributions, cash,
instruments and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or
in exchange for any or all of such shares; and
(iii) all General Intangibles.
3. Security for Obligations. This Agreement secures,
and the Pledged Collateral is security for, the prompt payment in full when
due, whether at stated maturity, by acceleration or otherwise, and performance
of all Obligations of any kind of the Pledgor under or in connection with the
Loan and Security Agreement and the other Loan Documents and all obligations of
the Pledgor now or hereafter existing under this Agreement including, without
limitation, all fees, costs and expenses whether in connection with collection
actions hereunder or otherwise (collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. All certificates
representing or evidencing the Pledged Shares shall be delivered to and held by
or on behalf of the Agent, for itself and the benefit of Lenders, pursuant
hereto. All pledged shares shall be accompanied by duly executed instruments
of transfer or assignment in blank, all in form and substance satisfactory to
the Agent. An acknowledgment of security interest in the form of Schedule III
hereto from each Pledged Entity the ownership interests of which are
uncertificated shall have been delivered to the Agent.
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5. Representations and Warranties. The Pledgor
represents and warrants to the Agent that:
(a) The Pledgor is, and at the time of delivery
of the Pledged Shares to the Agent will be, the sole holder of record
and the sole beneficial owner of such Pledged Collateral pledged by
the Pledgor free and clear of any Lien thereon or affecting the title
thereto, except for any Lien created by this Agreement;
(b) All of the Pledged Shares have been duly
authorized, validly issued and are fully paid and non-assessable;
(c) The Pledgor has the right and requisite
authority to pledge, assign, transfer, deliver, deposit and set over
the Pledged Collateral pledged by the Pledgor to the Agent as
provided herein;
(d) None of the Pledged Shares has been issued or
transferred in violation of the securities registration, securities
disclosure or similar laws of any jurisdiction to which such issuance
or transfer may be subject;
(e) All of the Pledged Shares are presently owned
by the Pledgor, and are presently represented by the stock
certificates listed on Schedule I hereto. All of the General
Intangibles are presently owned by the Pledgor, and are presently
uncertificated. As of the date hereof, there are no existing options,
warrants, calls or commitments of any character whatsoever relating to
the Pledged Shares or the General Intangibles;
(f) No consent, approval, authorization or other
order of any Person and no consent, authorization, approval, or other
action by, and no notice to or filing with, any governmental authority
is required (i) for the pledge by the Pledgor of the Pledged
Collateral pursuant to this Agreement or for the execution, delivery
or performance of this Agreement by the Pledgor, or (ii) for the
exercise by the Agent of the voting or other rights provided for in
this Agreement or the remedies in respect of the Pledged Collateral
pursuant to this Agreement, except as may be required in connection
with such disposition by laws affecting the offering and sale of
securities generally;
(g) The pledge, assignment and delivery of the
Pledged Collateral pursuant to this Agreement, together with the
relevant filings or recordings (which filings and recordings have been
made), will create a valid first priority Lien on and a first priority
perfected security interest in the Pledged Collateral pledged by the
Pledgor, and the proceeds thereof, securing the payment of the Secured
Obligations, subject to no other Lien or security interest;
(h) This Agreement has been duly authorized,
executed and delivered by the Pledgor and constitutes a legal, valid
and binding obligation of the Pledgor enforceable in accordance with
its terms;
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(i) The Pledged Shares constitute 1% of the
issued and outstanding shares of stock of the issuer thereof.
(j) The limited liability company agreement
delivered to the Agent is an original signed counterpart (or a copy
thereof) of the complete and entire agreement in effect on the date
hereof;
(k) The limited liability company agreement is
the legal, valid and binding obligation of the parties thereto,
enforceable in accordance with its terms and, together with this
Agreement, contains the entire agreement between the Pledgor relating
to the subject matter hereof. The Pledgor is not in default in the
payment of any portion of any mandatory capital contribution, if any,
required to be made under the limited liability company agreement, and
the Pledgor is not in violation of any other material provisions of
such agreement, or otherwise in default or violation thereunder. At
no time in the past has the Pledgor been in default for the payment of
any portion of a mandatory capital contribution or in violation of any
other material provisions of the limited liability company agreement,
or otherwise in default or violation thereunder other than those which
have been cured or waived prior to the date of this Agreement. No
General Intangible is subject to any defense, offset or counterclaim,
nor have any of the foregoing been asserted or alleged against the
Pledgor by any Person with respect thereto. As of the Closing Date,
there are no certificates, instruments, documents or other writings
(other than the limited liability company agreement delivered to the
Agent on the Closing Date) which evidence any General Intangible of
the Pledgor;
(l) The Pledgor shall not withdraw as a
shareholder or member of any Pledged Entity, or file or pursue to take
any action which may, directly or indirectly, cause a dissolution or
liquidation of or with respect to any Pledge Entity or seek a
partition of any property of any Pledged Entity; and
(m) An acknowledgment in the form set forth on
Schedule III attached hereto and by this reference made a part hereof
(such notice, the "Acknowledgment"), appropriately completed,
notifying each Pledged Entity, the ownership interests of which are
not uncertificated securities, of the existence of this Agreement and
a certified copy of this Agreement has been delivered by the Pledgor
to such Pledged Entity.
The representations and warranties set forth in this Section 5
shall survive the execution and delivery of this Agreement.
6. Covenants. The Pledgor covenants and agrees that
until the Pledge Termination Date (as defined in Section 11):
(a) Without the prior written consent of the
Agent, the Pledgor will not sell, assign, transfer, pledge, or
otherwise encumber any of its rights in or to the Pledged Collateral,
or any unpaid dividends or other distributions or payments with
respect to the
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Pledged Collateral or xxxxx x Xxxx in the Pledged Collateral, unless
otherwise expressly permitted by the Loan and Security Agreement;
(b) The Pledgor will, at its expense, promptly
execute, acknowledge and deliver all such instruments and take all
such actions as the Agent from time to time may request in order to
ensure to the Agent and Lenders the benefits of the Liens in and to
the Pledged Collateral intended to be created by this Agreement,
including the filing of any necessary UCC financing statements, which
may be filed by the Agent with or (to the extent permitted by law)
without the signature of the Pledgor, and will cooperate with the
Agent, at the Pledgor's expense, in obtaining all necessary approvals
and making all necessary filings under federal or state law in
connection with such Liens or any sale or transfer of the Pledged
Collateral;
(c) The Pledgor has and will defend the title to
the Pledged Collateral and the Liens of the Agent in the Pledged
Collateral against the claim of any Person and will maintain and
preserve such Liens;
(d) The Pledgor will, upon obtaining any
additional shares of stock of a Pledged Entity, which shares are not
already Pledged Collateral, promptly (and in any event within three
(3) Business Days) deliver to the Agent a Pledge Amendment, duly
executed by the Pledgor, in substantially the form of Schedule II
hereto (a "Pledge Amendment") in respect of any such additional shares
pursuant to which the Pledgor shall pledge to the Agent all in the of
such additional shares. The Pledgor hereby authorizes the Agent to
attach each Pledge Amendment to this Agreement and agrees that all
Pledged Shares listed on any Pledge Amendment delivered to the Agent
shall for all purposes hereunder be considered Pledged Collateral; and
(e) The Pledgor shall not permit any Pledged
Entity to declare any General Intangible to be classified as an
uncertificated "security" within the meaning of Section 8-103(c) of
the UCC.
7. The Pledgor's Rights. As long as no Default or Event
of Default shall have occurred and be continuing and until written notice shall
be given to the Pledgor in accordance with Section 8(a) hereof:
(a) The Pledgor shall have the right, from time
to time, to vote and give consents with respect to the Pledged
Collateral or any part thereof for all purposes not inconsistent with
the provisions of this Agreement, the Loan and Security Agreement or
any other Loan Document; provided, however, that no vote shall be
cast, and no consent shall be given or action taken, which would have
the effect of impairing the position or interest of the Agent in
respect of the Pledged Collateral or which would authorize or effect
(unless and to the extent expressly permitted by the Loan and Security
Agreement):
(i) the dissolution or liquidation, in
whole or in part, of a Pledged Entity;
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(ii) the consolidation or merger of a
Pledged Entity with any other Person;
(iii) the sale, disposition or
encumbrance of all or substantially all of the assets of a
Pledged Entity, except for Liens in favor of the Agent;
(iv) any change in the authorized
number of shares, the stated capital or the authorized share
capital of a Pledged Entity or the issuance of any additional
shares of its Stock or interests; or
(v) the alteration of the voting rights
with respect to the Stock of a Pledged Entity; and
(b)(i) The Pledgor shall be entitled, from time to
time, to collect and receive for its own use all cash dividends and
distributions paid in respect of the Pledged Shares and the General
Intangibles to the extent not in violation of the Loan and Security
Agreement other than any and all: (A) dividends and distributions paid
or payable other than in cash in respect of any Pledged Collateral,
and instruments and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any Pledged Collateral;
(B) dividends and other distributions paid or payable in cash in
respect of any Pledged Shares or General Intangibles in connection
with a partial or total liquidation or dissolution or in connection
with a reduction of capital, capital surplus or paid-in capital of a
Pledged Entity; and (C) cash paid, payable or otherwise distributed or
in redemption of, or in exchange for, any Pledged Collateral;
provided, however, that until actually paid all rights to such
distributions shall remain subject to the Lien created by this
Agreement; and
(ii) all dividends and distributions (other than
such cash dividends and distributions as are permitted to be paid to
the Pledgor in accordance with clause (i) above) and all other
distributions in respect of any of the Pledged Shares or General
Intangibles, whenever paid or made, shall be delivered to the Agent to
hold as Pledged Collateral and shall, if received by the Pledgor, be
received in trust for the benefit of the Agent, be segregated from the
other property or funds of the Pledgor, and be forthwith delivered to
the Agent as Pledged Collateral in the same form as so received (with
any necessary indorsement).
8. Defaults and Remedies.
(a) Upon the occurrence of an Event of Default and
during the continuation of such Event of Default, then on or at any
time after such declaration (provided that such declaration is not
rescinded by the Agent) and concurrently with written notice to the
Pledgor, the Agent (personally or through an agent) is hereby
authorized and empowered to transfer and register in its name or in
the name of its nominee the whole or any part of the Pledged
Collateral, to exchange certificates or instruments representing or
evidencing Pledged Collateral for certificates or instruments of
smaller or larger denominations, to exercise the voting and all other
rights as a stockholder with respect thereto, to collect and
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receive all cash dividends, interest, principal and other
distributions made thereon, to sell in one or more sales after ten
(10) days' notice of the time and place of any public sale or of the
time at which a private sale is to take place (which notice the
Pledgor agrees is commercially reasonable) the whole or any part of
the Pledged Collateral and to otherwise act with respect to the
Pledged Collateral as though the Agent was the outright owner thereof,
the Pledgor hereby irrevocably constituting and appointing the Agent
as the proxy and attorney-in-fact of the Pledgor, with full power of
substitution to do so, and which appointment shall remain in effect
until the Pledge Termination Date; provided, however, that Agent shall
not have any duty to exercise any such right or to preserve the same
and shall not be liable for any failure to do so or for any delay in
doing so. Any sale shall be made at a public or private sale at the
Agent's place of business, or at any place to be named in the notice
of sale, either for cash or upon credit or for future delivery at such
price as the Agent may deem fair, and the Agent may be the purchaser
of the whole or any part of the Pledged Collateral so sold and hold
the same thereafter in its own right free from any claim of the
Pledgor or any right of redemption. Each sale shall be made to the
highest bidder, but the Agent reserves the right to reject any and all
bids at such sale which, in its discretion, it shall deem inadequate.
Demands of performance, except as otherwise herein specifically
provided for, notices of sale, advertisements and the presence of
property at sale are hereby waived and any sale hereunder may be
conducted by an auctioneer or any officer or agent of the Agent.
(b) If, at the original time or times appointed
for the sale of the whole or any part of the Pledged Collateral, the
highest bid, if there be but one sale, shall be inadequate to
discharge in full all the Secured Obligations, or if the Pledged
Collateral be offered for sale in lots, if at any of such sales, the
highest bid for the lot offered for sale would indicate to the Agent,
in its discretion, that the proceeds of the sales of the whole of the
Pledged Collateral would be unlikely to be sufficient to discharge all
the Secured Obligations, the Agent may, on one or more occasions and
in its discretion, postpone any of said sales by public announcement
at the time of sale or the time of previous postponement of sale, and
no other notice of such postponement or postponements of sale need be
given, any other notice being hereby waived; provided, however, that
any sale or sales made after such postponement shall be after ten (10)
days' notice to the Pledgor.
(c) If, at any time when the Agent in its sole
discretion determines, following the occurrence and during the
continuance of an Event of Default, that, in connection with any
actual or contemplated exercise of its rights (when permitted under
this Section 8) to sell the whole or any part of the Pledged Shares
hereunder, it is necessary or advisable to effect a public
registration of all or part of the Pledged Collateral pursuant to the
Securities Act of 1933, as amended (or any similar statute then in
effect) (the "Act"), the Pledgor shall, in an expeditious manner,
cause the Pledged Entities to:
(i) Prepare and file with the
Securities and Exchange Commission (the " Commission") a
registration statement with respect to the Pledged Shares and
in good faith use commercially reasonable efforts to cause
such registration statement to become and remain effective;
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(ii) Prepare and file with the
Commission such amendments and supplements to such
registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the
Act with respect to the sale or other disposition of the
Pledged Shares covered by such registration statement whenever
the Agent shall desire to sell or otherwise dispose of the
Pledged Shares;
(iii) Furnish to the Agent such numbers
of copies of a prospectus and a preliminary prospectus, in
conformity with the requirements of the Act, and such other
documents as the Agent may request in order to facilitate the
public sale or other disposition of the Pledged Shares by the
Agent;
(iv) Use commercially reasonable
efforts to register or qualify the Pledged Shares covered by
such registration statement under such other securities or
blue sky laws of such jurisdictions within the United States
and Puerto Rico as the Agent shall request, and do such other
reasonable acts and things as may be required of it to enable
the Agent to consummate the public sale or other disposition
in such jurisdictions of the Pledged Shares by the Agent;
(v) Furnish, at the request of the
Agent, on the date that shares of the Pledged Collateral are
delivered to the underwriters for sale pursuant to such
registration or, if the security is not being sold through
underwriters, on the date that the registration statement with
respect to such Pledged Shares becomes effective, (A) an
opinion, dated such date, of the independent counsel
representing such registrant for the purposes of such
registration, addressed to the underwriters, if any, and in
the event the Pledged Shares are not being sold through
underwriters, then to the Agent, in customary form and
covering matters of the type customarily covered in such legal
opinions; and (B) a comfort letter, dated such date, from the
independent certified public accountants of such registrant,
addressed to the underwriters, if any, and in the event the
Pledged Shares are not being sold through underwriters, then
to the Agent, in a customary form and covering matters of the
type customarily covered by such comfort letters and as the
underwriters or the Agent shall reasonably request. The
opinion of counsel referred to above shall additionally cover
such other legal matters with respect to the registration in
respect of which such opinion is being given as the Agent may
reasonably request. The letter referred to above from the
independent certified public accountants shall additionally
cover such other financial matters (including information as
to the period ending not more than five (5) Business Days
prior to the date of such letter) with respect to the
registration in respect of which such letter is being given as
the Agent may reasonably request; and
(vi) Otherwise use commercially
reasonable efforts to comply with all applicable rules and
regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable but not
later than 18 months after the effective
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date of the registration statement, an earnings statement
covering the period of at least 12 months beginning with the
first full month after the effective date of such registration
statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Act.
(d) All expenses incurred in complying with
Section 8(c) hereof, including, without limitation, all registration
and filing fees (including all expenses incident to filing with the
National Association of Securities Dealers, Inc.), printing expenses,
fees and disbursements of counsel for the registrant, the fees and
expenses of counsel for the Agent, expenses of the independent
certified public accountants (including any special audits incident to
or required by any such registration) and expenses of complying with
the securities or blue sky laws or any jurisdictions, shall be paid by
the Pledgor.
(e) If, at any time when the Agent shall
determine to exercise its right to sell the whole or any part of the
Pledged Collateral hereunder, such Pledged Collateral or the part
thereof to be sold shall not, for any reason whatsoever, be
effectively registered under the Act, the Agent may, in its discretion
(subject only to applicable requirements of law), sell such Pledged
Collateral or part thereof by private sale in such manner and under
such circumstances as the Agent may deem necessary or advisable, but
subject to the other requirements of this Section 8, and shall not be
required to effect such registration or to cause the same to be
effected. Without limiting the generality of the foregoing, in any
such event, the Agent in its discretion (x) may, in accordance with
applicable securities laws, proceed to make such private sale
notwithstanding that a registration statement for the purpose of
registering such Pledged Collateral or part thereof could be or shall
have been filed under said Act (or similar statute), (y) may approach
and negotiate with a single possible purchaser to effect such sale,
and (z) may restrict such sale to a purchaser who is an accredited
investor under the Act and who will represent and agree that such
purchaser is purchasing for its own account, for investment and not
with a view to the distribution or sale of such Pledged Collateral or
any part thereof. In addition to a private sale as provided above in
this Section 8, if any of the Pledged Collateral shall not be freely
distributable to the public without registration under the Act (or
similar statute) at the time of any proposed sale pursuant to this
Section 8, then the Agent shall not be required to effect such
registration or cause the same to be effected but, in its discretion
(subject only to applicable requirements of law), may require that any
sale hereunder (including a sale at auction) be conducted subject to
restrictions:
(i) as to the financial sophistication and
ability of any Person permitted to bid or purchase at any such
sale;
(ii) as to the content of legends to be
placed upon any certificates representing the Pledged
Collateral sold in such sale, including restrictions on future
transfer thereof;
(iii) as to the representations required to
be made by each Person bidding or purchasing at such sale
relating to that Person's access to financial information
about the Pledgor and such Person's intentions as to the
holding of the
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Pledged Collateral so sold for investment for its own account
and not with a view to the distribution thereof; and
(iv) as to such other matters as the Agent
may, in its discretion, deem necessary or appropriate in order
that such sale (notwithstanding any failure so to register)
may be effected in compliance with the Bankruptcy Code and
other laws affecting the enforcement of creditors' rights and
the Act and all applicable state securities laws.
(f) The Pledgor recognizes that the Agent may be
unable to effect a public sale of any or all the Pledged Collateral
and may be compelled to resort to one or more private sales thereof in
accordance with clause (e) above. The Pledgor also acknowledges that
any such private sale may result in prices and other terms less
favorable to the seller than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale
shall not be deemed to have been made in a commercially unreasonable
manner solely by virtue of such sale being private. The Agent shall
be under no obligation to delay a sale of any of the Pledged
Collateral for the period of time necessary to permit the Pledged
Entity to register such securities for public sale under the Act, or
under applicable state securities laws, even if the Pledgor and the
Pledged Entity would agree to do so.
(g) The Pledgor agrees to the maximum extent
permitted by applicable law that following the occurrence and during
the continuance of an Event of Default it will not at any time plead,
claim or take the benefit of any appraisal, valuation, stay,
extension, moratorium or redemption law now or hereafter in force in
order to prevent or delay the enforcement of this Agreement, or the
absolute sale of the whole or any part of the Pledged Collateral or
the possession thereof by any purchaser at any sale hereunder, and the
Pledgor waives the benefit of all such laws to the extent it lawfully
may do so. The Pledgor agrees that it will not interfere with any
right, power and remedy of the Agent provided for in this Agreement or
now or hereafter existing at law or in equity or by statute or
otherwise, or the exercise or beginning of the exercise by the Agent
of any one or more of such rights, powers or remedies. No failure or
delay on the part of the Agent to exercise any such right, power or
remedy and no notice or demand which may be given to or made upon the
Pledgor by the Agent with respect to any such remedies shall operate
as a waiver thereof, or limit or impair the Agent's right to take any
action or to exercise any power or remedy hereunder, without notice or
demand, or prejudice its rights as against the Pledgor in any respect.
(h) The Pledgor further agrees that a breach of
any of the covenants contained in this Section 8 will cause
irreparable injury to the Agent, that the Agent shall have no adequate
remedy at law in respect of such breach and, as a consequence, agrees
that each and every covenant contained in this Section 8 shall be
specifically enforceable against the Pledgor, and the Pledgor hereby
waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that the
Secured Obligations are not then due and payable in accordance with
the agreements and instruments governing and evidencing such
obligations.
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9. Waiver. No delay on the Agent's part in exercising
any power of sale, Lien, option or other right hereunder, and no notice or
demand which may be given to or made upon the Pledgor by the Agent with respect
to any power of sale, Lien, option or other right hereunder, shall constitute a
waiver thereof, or limit or impair the Agent's right to take any action or to
exercise any power of sale, Lien, option, or any other right hereunder, without
notice or demand, or prejudice the Agent's rights as against the Pledgor in any
respect.
10. Assignment. The Agent may assign, indorse or
transfer any instrument evidencing all or any part of the Secured Obligations
as provided in, and in accordance with, the Loan and Security Agreement, and
the holder of such instrument shall be entitled to the benefits of this
Agreement.
11. Termination. Immediately following the payment in
full, in cash of all Secured Obligations on or after the Termination Date (as
defined in the Loan and Security Agreement) (the "Pledge Termination Date"),
the Agent shall deliver to the Pledgor the Pledged Collateral pledged by the
Pledgor at the time subject to this Agreement and all instruments of assignment
executed in connection therewith, free and clear of the Liens hereof and,
except as otherwise provided herein, all of the Pledgor's obligations hereunder
shall at such time terminate.
12. Lien Absolute. All rights of the Agent hereunder,
and all obligations of the Pledgor hereunder, shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of the
Loan and Security Agreement, any other Loan Document or any other
agreement or instrument governing or evidencing any Secured
Obligations;
(b) any change in the time, manner or place of
payment of, or in any other term of, all or any part of the Secured
Obligations, or any other amendment or waiver of or any consent to any
departure from the Loan and Security Agreement, any other Loan
Document or any other agreement or instrument governing or evidencing
any Secured Obligations;
(c) any exchange, release or non-perfection of
any other Collateral, or any release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the Secured
Obligations; or
(d) any other circumstance which might otherwise
constitute a defense available to, or a discharge of, the Pledgor.
13. Release. Pledgor consents and agrees that the Agent
may at any time, or from time to time, in its discretion:
(a) renew, extend or change the time of payment,
and/or the manner, place or terms of payment of all or any part of the
Secured Obligations; and
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(b) exchange, release and/or surrender all or any of
the Collateral (including the Pledged Collateral), or any part
thereof, by whomsoever deposited, which is now or may hereafter be
held by the Agent in connection with all or any of the Secured
Obligations; all in such manner and upon such terms as the Agent may
deem proper, and without notice to or further assent from the Pledgor,
it being hereby agreed that the Pledgor shall be and remain bound upon
this Agreement, irrespective of the value or condition of any of the
Collateral, and notwithstanding any such change, exchange, settlement,
compromise, surrender, release, renewal or extension, and
notwithstanding also that the Secured Obligations may, at any time,
exceed the aggregate principal amount thereof set forth in the Loan
and Security Agreement, or any other agreement governing any Secured
Obligations. The Pledgor hereby waives notice of acceptance of this
Agreement, and also presentment, demand, protest and notice of
dishonor of any and all of the Secured Obligations, and promptness in
commencing suit against any party hereto or liable hereon, and in
giving any notice to or of making any claim or demand hereunder upon
the Pledgor. No act or omission of any kind on the Agent's part shall
in any event affect or impair this Agreement.
14. Reinstatement. This Agreement shall remain in full
force and effect and continue to be effective should any petition be filed by
or against the Pledgor or any Pledged Entity for liquidation or reorganization,
should the Pledgor or any Pledged Entity become insolvent or make an assignment
for the benefit of creditors or should a receiver or trustee be appointed for
all or any significant part of the Pledgor's or a Pledged Entity's assets, and
shall continue to be effective or be reinstated, as the case may be, if at any
time payment and performance of the Secured Obligations, or any part thereof,
is, pursuant to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee of the Secured Obligations,
whether as a "voidable preference", "fraudulent conveyance", or otherwise, all
as though such payment or performance had not been made. In the event that any
payment, or any part thereof, is rescinded, reduced, restored or returned, the
Secured Obligations shall be reinstated and deemed reduced only by such amount
paid and not so rescinded, reduced, restored or returned.
15. Miscellaneous.
(a) The Agent may execute any of its duties
hereunder by or through agents or employees and shall be entitled to
advice of counsel concerning all matters pertaining to its duties
hereunder.
(b) The Pledgor agrees to promptly reimburse
Agent for actual out-of-pocket expenses, including, without
limitation, reasonable counsel fees, incurred by Agent in connection
with the administration and enforcement of this Agreement.
(c) Neither the Agent, nor any of its respective
officers, directors, employees, agents or counsel shall be liable for
any action lawfully taken or omitted to be taken by it or them
hereunder or in connection herewith, except for its or their own gross
negligence or willful misconduct.
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(d) THIS AGREEMENT SHALL BE BINDING UPON THE
PLEDGOR AND ITS SUCCESSORS AND ASSIGNS (INCLUDING A
DEBTOR-IN-POSSESSION ON BEHALF OF THE PLEDGOR), AND SHALL INURE TO THE
BENEFIT OF, AND BE ENFORCEABLE BY, THE AGENT AND ITS SUCCESSORS AND
ASSIGNS, AND SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN THAT STATE, AND NONE OF THE TERMS OR
PROVISIONS OF THIS AGREEMENT MAY BE WAIVED, ALTERED, MODIFIED OR
AMENDED EXCEPT IN WRITING DULY SIGNED FOR AND ON BEHALF OF THE AGENT
AND THE PLEDGOR.
16. Severability. If for any reason any provision or
provisions hereof are determined to be invalid and contrary to any existing or
future law, such invalidity shall not impair the operation of or effect those
portions of this Agreement which are valid.
17. Notices. Except as otherwise provided herein,
whenever it is provided herein that any notice, demand, request, consent,
approval, declaration or other communication shall or may be given to or served
upon any of the parties by any other party, or whenever any of the parties
desires to give or serve upon any other a communication with respect to this
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and either shall be delivered in person
or sent by registered or certified mail, return receipt requested, postage
prepaid, or by facsimile transmission and confirmed by facsimile transmission
answer back addressed (x) in the case of the Pledgor, LDM Holding Canada, Inc.,
LDM Technologies, Inc., 0000 Xxxxxxxxx Xxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxxxx
00000, Attention: Xxxxxx X. Xxxxx, Fax No.: (000) 000-0000, Tel. No.: (810)
000-0000, and (y) in the case of the Agent and the Lenders, as provided in
Section 15.8 of the Loan and Security Agreement, or at such other address as
may be substituted by notice given as herein provided. The giving of any
notice required hereunder may be waived in writing by the party entitled to
receive such notice. Every notice, demand, request, consent, approval,
declaration or other communication hereunder shall be deemed to have been duly
given or served on the date on which personally delivered, transmitted and
confirmed by facsimile transmission answerback or three (3) Business Days after
the same shall have been deposited in the United States mail. Failure or delay
in delivering copies of any notice, demand, request, consent, approval,
declaration or other communication to the persons designated above to receive
copies shall in no way adversely affect the effectiveness of such notice,
demand, request, consent, approval, declaration or other communication.
18. Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
19. Counterparts. This Agreement may be executed in any
number of counterparts, which shall, collectively and separately, constitute
one agreement.
20. Benefit of Lenders. All security interests granted
or contemplated hereby shall be for the benefit of the Agent and Lenders, and
all proceeds or payments realized from the
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Pledged Collateral in accordance herewith shall be applied to the Obligations
in accordance with the terms of the Loan and Security Agreement.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
LDM HOLDING CANADA, INC.
By: /s/ Xxx Xxxxxx
---------------------------------
Name: Xxx Xxxxxx
---------------------------
Title: Secretary
--------------------------
Accepted and Acknowledged by:
BANKAMERICA BUSINESS CREDIT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
---------------------------
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SCHEDULE I
PART A
PLEDGED SHARES
Class Number
of Stock/ Stock Certificate of Shares/ Percentage of
Pledged Entity Interests Number(s) Interests Outstanding Shares
-------------- --------- ----------------- ---------- ------------------
LDM Technologies Company Common 2 100 1%
LDM Holdings, L.L.C. 33.33%
25
SCHEDULE II
PLEDGE AMENDMENT
This Pledge Amendment, dated ____________, _____ is delivered pursuant
to Section 6(d) of the Pledge Agreement referred to below. The undersigned
hereby certifies that the representations and warranties in Section 5 of the
Pledge Agreement are and continue to be true and correct, both as to the
promissory notes, instruments and shares pledged prior to this Pledge Amendment
and as to the promissory notes, instruments and shares pledged pursuant to this
Pledge Amendment. The undersigned further agrees that this Pledge Amendment may
be attached to that certain Pledge Agreement, dated January ___, 1997, between
undersigned, as the Pledgor, and BankAmerica Business Credit, Inc., as the
Agent, and that the Pledged Shares and Pledged Debt listed on this Pledge
Amendment shall be and become a part of the Pledged Collateral referred to in
said Pledge Agreement and shall secure all Secured Obligations referred to in
said Pledge Agreement. The undersigned acknowledges that any promissory notes,
instruments or shares not included in the Pledged Collateral at the discretion
of the Agent may not otherwise be pledged or otherwise used as security by the
Pledgor.
LDM HOLDING CANADA, INC.
By:
---------------------------
Name:
---------------------
Title:
--------------------
Name and Class Certificate Number
Address of the Pledgor Pledged Entity of Stock Number(s) of Shares
---------------------- -------------- -------- ----------- ---------
26
SCHEDULE III
ACKNOWLEDGMENT OF SECURITY INTEREST
[NAME OF PLEDGED ENTITY] (the "Company") hereby acknowledges receipt of
a copy of the assignment by LDM Holding Canada, Inc., (the "Pledgor") of its
interest under the [TITLE OF AGREEMENT] (the "Agreement") pursuant to the terms
of the Pledge and Security Agreement, dated as of January __, 1997 (the "Pledge
Agreement"), between the Pledgor and BankAmerica Business Credit, Inc., as
Agent.
The undersigned hereby further confirms the registration of the
Pledgor's pledge of its interest in the Company to the Agent on the Company's
books.
The Company agrees that at any time prior to the Pledge Termination
Date (as defined in the Pledge Agreement), it will not take or approve any
action in furtherance of deeming the interests of the Company to be
uncertificated "security" within the meaning of Section 8-103(c) of the UCC (as
defined in the Pledge Agreement) and that its membership or partnership
interest shall at all times be general intangibles under the UCC.
Dated: , 1997 [NAME OF PLEDGED ENTITY]
-------------- --
By:
--------------------------
Title:
-------------------
27
LDM LLC PLEDGE AND SECURITY AGREEMENT
This LDM LLC PLEDGE AND SECURITY AGREEMENT, dated as of January 22, 1997
(together with all amendments, if any, from time to time hereto, this
"Agreement") between LDM HOLDINGS, L.L.C., a Michigan limited liability company
(the "Pledgor") in favor of BANKAMERICA BUSINESS CREDIT, INC. in its capacity
as Agent for the Lenders ("Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Guarantee, dated as of January 22, 1997
(the "LDM LLC Guarantee"), made by the Pledgor, the Pledgor has provided a
guarantee of the payment of the Obligations under the Loan and Security
Agreement dated as of January 22, 1997, by and among the Pledgor, the Agent and
the Persons signatory thereto from time to time as Lenders (as from time to
time amended, restated, supplemented or otherwise modified (the "Loan and
Security Agreement") the Lenders have agreed to make Loans to, and incur
Obligations with respect to Letter of Credit issued for the benefit of, the
Pledgor;
WHEREAS, the Pledgor is the record and beneficial owner of all the
partnership interests of the entity (the "Pledged Entity") described in
Schedule I hereto;
WHEREAS, the Pledgor benefits from the credit facilities made available to
the Borrower through the Loan and Security Agreement;
WHEREAS, it is a condition to the making of Loans and the incurrence of
Obligations relating to the issuance of Letters of Credit under the Loan and
Security Agreement that the Pledgor shall have executed and delivered this
Agreement and granted the security interest contemplated hereby to secure the
obligations of the Pledgor under the LDM LLC Guarantee;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained and to induce Lenders to make Loans and to incur
Obligations relating to the issuance of Letter of Credit under the Loan and
Security Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms defined in the
Loan and Security Agreement are used herein as therein defined, and the
following shall have (unless otherwise provided elsewhere in this Agreement)
the following respective meanings (such meanings being equally applicable to
both the singular and plural form of the terms defined):
"Bankruptcy Code" means title 11, United States Code, as amended
from time to time, and any successor statute thereto.
"General Intangibles" means all of the Pledgor's now owned or
hereafter acquired general intangibles, choses in action and causes of
action and all other intangible personal property of the Pledgor of every
kind and nature, including, without limitation, all contract
28
rights, partnership interests, corporate or other business records, with
respect to the Pledged Entity.
"Pledged Collateral" has the meaning assigned to such term in
Section 2 hereof.
"Secured Obligations" has the meaning assigned to such term in
Section 3 hereof.
2. Pledge. The Pledgor hereby pledges to the Agent, and grants to the
Agent for itself and the benefit of Lenders, a first priority security interest
in all of the General Intangibles (collectively, the "Pledged Collateral").
3. Security for Obligations. This Agreement secures, and the Pledged
Collateral is security for, the prompt payment in full when due, whether at
stated maturity, by acceleration or otherwise, and performance of all
Obligations of any kind of the Pledgor under or in connection with the Loan and
Security Agreement and the other Loan Documents and all obligations of the
Pledgor now or hereafter existing under this Agreement including, without
limitation, all fees, costs and expenses whether in connection with collection
actions hereunder or otherwise (collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. An acknowledgment of security interest
in the form of Schedule III hereto from the Pledged Entity the ownership
interests of which are uncertificated shall have been delivered to the Agent.
5. Representations and Warranties. The Pledgor represents and warrants to
the Agent that:
(a) The Pledgor is the sole holder of record and the sole beneficial
owner of such Pledged Collateral pledged by the Pledgor free and clear of
any Lien thereon or affecting the title thereto, except for any Lien
created by this Agreement;
(b) The Pledgor has the right and requisite authority to pledge,
assign, transfer, deliver, deposit and set over the Pledged Collateral
pledged by the Pledgor to the Agent as provided herein;
(c) All of the General Intangibles are presently owned by the
Pledgor, and are presently uncertificated. As of the date hereof, there
are no existing options, warrants, calls or commitments of any character
whatsoever relating to the General Intangibles;
(d) No consent, approval, authorization or other order of any Person
and no consent, authorization, approval, or other action by, and no
notice to or filing with, any governmental authority is required (i) for
the pledge by the Pledgor of the Pledged Collateral pursuant to this
Agreement or for the execution, delivery or performance of this Agreement
by the Pledgor, or (ii) for the exercise by the Agent of the voting or
other rights provided for in this Agreement or the remedies in respect of
the Pledged Collateral pursuant to this
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Agreement, except as may be required in connection with such disposition
by laws affecting the offering and sale of securities generally;
(e) The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement, together with the relevant filings or
recordings (which filings and recordings have been made), will create a
valid first priority Lien on and a first priority perfected security
interest in the Pledged Collateral pledged by the Pledgor, and the
proceeds thereof, securing the payment of the Secured Obligations,
subject to no other Lien or security interest;
(f) This Agreement has been duly authorized, executed and delivered
by the Pledgor and constitutes a legal, valid and binding obligation of
the Pledgor enforceable in accordance with its terms;
(g) The limited partnership agreement delivered to the Agent is an
original signed counterpart (or a copy thereof) of the complete and
entire agreement in effect on the date hereof;
(h) The limited partnership agreement is the legal, valid and
binding obligation of the parties thereto, enforceable in accordance with
its terms and, together with this Agreement, contains the entire
agreement between the Pledgor relating to the subject matter hereof. The
Pledgor is not in default in the payment of any portion of any mandatory
capital contribution, if any, required to be made under the limited
partnership agreement, and the Pledgor is not in violation of any other
material provisions of such agreement, or otherwise in default or
violation thereunder. At no time in the past has the Pledgor been in
default for the payment of any portion of a mandatory capital
contribution or in violation of any other material provisions of the
limited partnership agreement, or otherwise in default or violation
thereunder other than those which have been cured or waived prior to the
date of this Agreement. No General Intangible is subject to any defense,
offset or counterclaim, nor have any of the foregoing been asserted or
alleged against the Pledgor by any Person with respect thereto. As of
the Closing Date, there are no certificates, instruments, documents or
other writings (other than the limited partnership agreement delivered to
the Agent on the Closing Date) which evidence any General Intangible of
the Pledgor;
(i) The Pledgor shall not withdraw as a partner of the Pledged
Entity, or file or pursue to take any action which may, directly or
indirectly, cause a dissolution or liquidation of or with respect to the
Pledge Entity or seek a partition of any property of the Pledged Entity;
and
(m) An acknowledgment in the form set forth on Schedule II attached
hereto and by this reference made a part hereof (such notice, the
"Acknowledgment"), appropriately completed, notifying the Pledged Entity
of the existence of this Agreement and a certified copy of this Agreement
has been delivered by the Pledgor to the Pledged Entity.
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The representations and warranties set forth in this Section 5 shall
survive the execution and delivery of this Agreement.
6. Covenants. The Pledgor covenants and agrees that until the Pledge
Termination Date (as defined in Section 11):
(a) Without the prior written consent of the Agent, the Pledgor will
not sell, assign, transfer, pledge, or otherwise encumber any of its
rights in or to the Pledged Collateral, or any unpaid distributions or
payments with respect to the Pledged Collateral or xxxxx x Xxxx in the
Pledged Collateral, unless otherwise expressly permitted by the Loan and
Security Agreement;
(b) The Pledgor will, at its expense, promptly execute, acknowledge
and deliver all such instruments and take all such actions as the Agent
from time to time may request in order to ensure to the Agent and Lenders
the benefits of the Liens in and to the Pledged Collateral intended to be
created by this Agreement, including the filing of any necessary UCC
financing statements, which may be filed by the Agent with or (to the
extent permitted by law) without the signature of the Pledgor, and will
cooperate with the Agent, at the Pledgor's expense, in obtaining all
necessary approvals and making all necessary filings under federal or
state law in connection with such Liens or any sale or transfer of the
Pledged Collateral;
(c) The Pledgor has and will defend the title to the Pledged
Collateral and the Liens of the Agent in the Pledged Collateral against
the claim of any Person and will maintain and preserve such Liens; and
(d) The Pledgor shall not permit the Pledged Entity to declare any
General Intangible to be classified as an uncertificated "security"
within the meaning of Section 8-103(c) of the UCC.
7. The Pledgor's Rights. As long as no Default or Event of Default shall
have occurred and be continuing and until written notice shall be given to the
Pledgor in accordance with Section 8(a) hereof:
(a) The Pledgor shall have the right, from time to time, to vote and
give consents with respect to the Pledged Collateral or any part thereof
for all purposes not inconsistent with the provisions of this Agreement,
the Loan and Security Agreement or any other Loan Document; provided,
however, that no vote shall be cast, and no consent shall be given or
action taken, which would have the effect of impairing the position or
interest of the Agent in respect of the Pledged Collateral or which would
authorize or effect (unless and to the extent expressly permitted by the
Loan and Security Agreement):
(i) the dissolution or liquidation, in whole or in part, of
the Pledged Entity;
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(ii) the consolidation or merger of the Pledged Entity with
any other Person;
(iii) the sale, disposition or encumbrance of all or
substantially all of the assets of the Pledged Entity, except for
Liens in favor of the Agent; or
(iv) any change in the stated capital of the Pledged Entity or
the issuance of any additional interests; and
(b)(i) The Pledgor shall be entitled, from time to time, to collect
and receive for its own use all cash distributions paid in respect of the
General Intangibles to the extent not in violation of the Loan and
Security Agreement other than any and all: (A) distributions paid or
payable other than in cash in respect of any Pledged Collateral, and
instruments and other property received, receivable or otherwise
distributed in respect of, or in exchange for, any Pledged Collateral;
(B) distributions paid or payable in cash in respect of any General
Intangible in connection with a partial or total liquidation or
dissolution or in connection with a reduction of capital of the Pledged
Entity; and (C) cash paid, payable or otherwise distributed or in
redemption of, or in exchange for, the Pledged Collateral; provided,
however, that until actually paid all rights to such distributions shall
remain subject to the Lien created by this Agreement; and
(ii) all distributions (other than such cash distributions as are
permitted to be paid to the Pledgor in accordance with clause (i) above)
and all other distributions in respect of any of the General Intangibles,
whenever paid or made, shall be delivered to the Agent to hold as Pledged
Collateral and shall, if received by the Pledgor, be received in trust
for the benefit of the Agent, be segregated from the other property or
funds of the Pledgor, and be forthwith delivered to the Agent as Pledged
Collateral in the same form as so received (with any necessary
indorsement).
8. Defaults and Remedies.
(a) Upon the occurrence of an Event of Default and during the
continuation of such Event of Default, then on or at any time after such
declaration (provided that such declaration is not rescinded by the
Agent) and concurrently with written notice to the Pledgor, the Agent
(personally or through an agent) is hereby authorized and empowered to
transfer and register in its name or in the name of its nominee the whole
or any part of the Pledged Collateral, to exchange certificates or
instruments representing or evidencing Pledged Collateral for
certificates or instruments of smaller or larger denominations, to
exercise the voting and all other rights as a stockholder with respect
thereto, to collect and receive all cash dividends, interest, principal
and other distributions made thereon, to sell in one or more sales after
ten (10) days' notice of the time and place of any public sale or of the
time at which a private sale is to take place (which notice the Pledgor
agrees is commercially reasonable) the whole or any part of the Pledged
Collateral and to otherwise act with respect to the Pledged Collateral as
though the Agent was the outright owner thereof, the Pledgor hereby
irrevocably constituting and appointing the Agent as the proxy and
attorney-in-fact
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of the Pledgor, with full power of substitution to do so, and which
appointment shall remain in effect until the Pledge Termination Date;
provided, however, that Agent shall not have any duty to exercise any
such right or to preserve the same and shall not be liable for any
failure to do so or for any delay in doing so. Any sale shall be made at
a public or private sale at the Agent's place of business, or at any
place to be named in the notice of sale, either for cash or upon credit
or for future delivery at such price as the Agent may deem fair, and the
Agent may be the purchaser of the whole or any part of the Pledged
Collateral so sold and hold the same thereafter in its own right free
from any claim of the Pledgor or any right of redemption. Each sale
shall be made to the highest bidder, but the Agent reserves the right to
reject any and all bids at such sale which, in its discretion, it shall
deem inadequate. Demands of performance, except as otherwise herein
specifically provided for, notices of sale, advertisements and the
presence of property at sale are hereby waived and any sale hereunder may
be conducted by an auctioneer or any officer or agent of the Agent.
(b) If, at the original time or times appointed for the sale of the
whole or any part of the Pledged Collateral, the highest bid, if there be
but one sale, shall be inadequate to discharge in full all the Secured
Obligations, or if the Pledged Collateral be offered for sale in lots, if
at any of such sales, the highest bid for the lot offered for sale would
indicate to the Agent, in its discretion, that the proceeds of the sales
of the whole of the Pledged Collateral would be unlikely to be sufficient
to discharge all the Secured Obligations, the Agent may, on one or more
occasions and in its discretion, postpone any of said sales by public
announcement at the time of sale or the time of previous postponement of
sale, and no other notice of such postponement or postponements of sale
need be given, any other notice being hereby waived; provided, however,
that any sale or sales made after such postponement shall be after ten
(10) days' notice to the Pledgor.
(c) The Pledgor agrees to the maximum extent permitted by
applicable law that following the occurrence and during the
continuance of an Event of Default it will not at any time plead,
claim or take the benefit of any appraisal, valuation, stay,
extension, moratorium or redemption law now or hereafter in force
in order to prevent or delay the enforcement of this Agreement, or
the absolute sale of the whole or any part of the Pledged
Collateral or the possession thereof by any purchaser at any sale
hereunder, and the Pledgor waives the benefit of all such laws to
the extent it lawfully may do so. The Pledgor agrees that it will
not interfere with any right, power and remedy of the Agent
provided for in this Agreement or now or hereafter existing at law
or in equity or by statute or otherwise, or the exercise or
beginning of the exercise by the Agent of any one or more of such
rights, powers or remedies. No failure or delay on the part of the
Agent to exercise any such right, power or remedy and no notice or
demand which may be given to or made upon the Pledgor by the Agent
with respect to any such remedies shall operate as a waiver
thereof, or limit or impair the Agent's right to take any action or
to exercise any power or remedy hereunder, without notice or
demand, or prejudice its rights as against the Pledgor in any
respect.
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(d) The Pledgor further agrees that a breach of any of the covenants
contained in this Section 8 will cause irreparable injury to the Agent,
that the Agent shall have no adequate remedy at law in respect of such
breach and, as a consequence, agrees that each and every covenant
contained in this Section 8 shall be specifically enforceable against the
Pledgor, and the Pledgor hereby waives and agrees not to assert any
defenses against an action for specific performance of such covenants
except for a defense that the Secured Obligations are not then due and
payable in accordance with the agreements and instruments governing and
evidencing such obligations.
9. Waiver. No delay on the Agent's part in exercising any power of sale,
Lien, option or other right hereunder, and no notice or demand which may be
given to or made upon the Pledgor by the Agent with respect to any power of
sale, Lien, option or other right hereunder, shall constitute a waiver thereof,
or limit or impair the Agent's right to take any action or to exercise any
power of sale, Lien, option, or any other right hereunder, without notice or
demand, or prejudice the Agent's rights as against the Pledgor in any respect.
10. Assignment. The Agent may assign, indorse or transfer any instrument
evidencing all or any part of the Secured Obligations as provided in, and in
accordance with, the Loan and Security Agreement, and the holder of such
instrument shall be entitled to the benefits of this Agreement.
11. Termination. Immediately following the payment in full, in cash of
all Secured Obligations on or after the Termination Date (as defined in the
Loan and Security Agreement) (the "Pledge Termination Date"), the Agent shall
deliver to the Pledgor the Pledged Collateral pledged by the Pledgor at the
time subject to this Agreement and all instruments of assignment executed in
connection therewith, free and clear of the Liens hereof and, except as
otherwise provided herein, all of the Pledgor's obligations hereunder shall at
such time terminate.
12. Lien Absolute. All rights of the Agent hereunder, and all obligations
of the Pledgor hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Loan and Security
Agreement, any other Loan Document or any other agreement or instrument
governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Loan and
Security Agreement, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations;
(c) any exchange, release or non-perfection of any other Collateral,
or any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Secured Obligations; or
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34
(d) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor.
13. Release. Pledgor consents and agrees that the Agent may at any time,
or from time to time, in its discretion:
(a) renew, extend or change the time of payment, and/or the manner,
place or terms of payment of all or any part of the Secured Obligations;
and
(b) exchange, release and/or surrender all or any of the Collateral
(including the Pledged Collateral), or any part thereof, by whomsoever
deposited, which is now or may hereafter be held by the Agent in
connection with all or any of the Secured Obligations; all in such manner
and upon such terms as the Agent may deem proper, and without notice to
or further assent from the Pledgor, it being hereby agreed that the
Pledgor shall be and remain bound upon this Agreement, irrespective of
the value or condition of any of the Collateral, and notwithstanding any
such change, exchange, settlement, compromise, surrender, release,
renewal or extension, and notwithstanding also that the Secured
Obligations may, at any time, exceed the aggregate principal amount
thereof set forth in the Loan and Security Agreement, or any other
agreement governing any Secured Obligations. The Pledgor hereby waives
notice of acceptance of this Agreement, and also presentment, demand,
protest and notice of dishonor of any and all of the Secured Obligations,
and promptness in commencing suit against any party hereto or liable
hereon, and in giving any notice to or of making any claim or demand
hereunder upon the Pledgor. No act or omission of any kind on the
Agent's part shall in any event affect or impair this Agreement.
14. Reinstatement. This Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or against the
Pledgor or any Pledged Entity for liquidation or reorganization, should the
Pledgor or any Pledged Entity become insolvent or make an assignment for the
benefit of creditors or should a receiver or trustee be appointed for all or
any significant part of the Pledgor's or a Pledged Entity's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Secured Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise
be restored or returned by any obligee of the Secured Obligations, whether as a
"voidable preference", "fraudulent conveyance", or otherwise, all as though
such payment or performance had not been made. In the event that any payment,
or any part thereof, is rescinded, reduced, restored or returned, the Secured
Obligations shall be reinstated and deemed reduced only by such amount paid and
not so rescinded, reduced, restored or returned.
15. Miscellaneous.
(a) The Agent may execute any of its duties hereunder by or through
agents or employees and shall be entitled to advice of counsel concerning
all matters pertaining to its duties hereunder.
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(b) The Pledgor agrees to promptly reimburse Agent for actual
out-of-pocket expenses, including, without limitation, reasonable counsel
fees, incurred by Agent in connection with the administration and
enforcement of this Agreement.
(c) Neither the Agent, nor any of its respective officers,
directors, employees, agents or counsel shall be liable for any action
lawfully taken or omitted to be taken by it or them hereunder or in
connection herewith, except for its or their own gross negligence or
willful misconduct.
(d) THIS AGREEMENT SHALL BE BINDING UPON THE PLEDGOR AND ITS
SUCCESSORS AND ASSIGNS (INCLUDING A DEBTOR-IN-POSSESSION ON BEHALF OF THE
PLEDGOR), AND SHALL INURE TO THE BENEFIT OF, AND BE ENFORCEABLE BY, THE
AGENT AND ITS SUCCESSORS AND ASSIGNS, AND SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
ILLINOIS APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE, AND
NONE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT MAY BE WAIVED, ALTERED,
MODIFIED OR AMENDED EXCEPT IN WRITING DULY SIGNED FOR AND ON BEHALF OF
THE AGENT AND THE PLEDGOR.
16. Severability. If for any reason any provision or provisions hereof
are determined to be invalid and contrary to any existing or future law, such
invalidity shall not impair the operation of or effect those portions of this
Agreement which are valid.
17. Notices. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties by any other party, or whenever any of the parties desires to
give or serve upon any other a communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and either shall be delivered in person or
sent by registered or certified mail, return receipt requested, postage
prepaid, or by facsimile transmission and confirmed by facsimile transmission
answer back addressed (x) in the case of the Pledgor, LDM Holdings, L.L.C., LDM
Technologies, Inc., 0000 Xxxxxxxxx Xxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxxxx 00000,
Attention:Xxxxxx Xxxxx, Fax No.: (000) 000-0000, Tel. No.: (000) 000-0000 and
(y) in the case of the Agent and the Lenders, as provided in Section 15.8 of
the Loan and Security Agreement, or at such other address as may be substituted
by notice given as herein provided. The giving of any notice required
hereunder may be waived in writing by the party entitled to receive such
notice. Every notice, demand, request, consent, approval, declaration or other
communication hereunder shall be deemed to have been duly given or served on
the date on which personally delivered, transmitted and confirmed by facsimile
transmission answerback or three (3) Business Days after the same shall have
been deposited in the United States mail. Failure or delay in delivering
copies of any notice, demand, request, consent, approval, declaration or other
communication to the persons designated above to receive copies shall in no way
adversely affect the effectiveness of such notice, demand, request, consent,
approval, declaration or other communication.
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18. Section Titles. The Section titles contained in this Agreement are
and shall be without substantive meaning or content of any kind whatsoever and
are not a part of the agreement between the parties hereto.
19. Counterparts. This Agreement may be executed in any number of
counterparts, which shall, collectively and separately, constitute one
agreement.
20. Benefit of Lenders. All security interests granted or contemplated
hereby shall be for the benefit of the Agent and Lenders, and all proceeds or
payments realized from the Pledged Collateral in accordance herewith shall be
applied to the Obligations in accordance with the terms of the Loan and
Security Agreement.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
LDM HOLDINGS, L.L.C.
By: LDM TECHNOLOGIES, INC.,
its Member
By: /s/ Xxx Xxxxxx
---------------------------------
Name: Xxx Xxxxxx
---------------------------
Title: Secretary
--------------------------
Accepted and Acknowledged by:
BANKAMERICA BUSINESS CREDIT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
---------------------------
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SCHEDULE I
PART A
GENERAL INTANGIBLES
Class
of Number Percentage of
Pledged Entity Interests of Interests Outstanding Interest
--------------------------------- --------- ------------ --------------------
LDM Canada Limited Partnership 3%
39
SCHEDULE II
ACKNOWLEDGMENT OF SECURITY INTEREST
[NAME OF PLEDGED ENTITY] (the "Company") hereby acknowledges receipt of a
copy of the assignment by LDM Holdings, L.L.C. (the "Pledgor"), of its interest
under the [TITLE OF AGREEMENT] (the "Agreement") pursuant to the terms of the
Pledge and Security Agreement, dated as of January __, 1997 (the "Pledge
Agreement"), between the Pledgor and BankAmerica Business Credit, Inc., as
Agent.
The undersigned hereby further confirms the registration of the Pledgor's
pledge of its interest in the Company to the Agent on the Company's books.
The Company agrees that at any time prior to the Pledge Termination Date
(as defined in the Pledge Agreement), it will not take or approve any action in
furtherance of deeming the interests of the Company to be an uncertificated
"security" within the meaning of Section 8-103(c) of the UCC (as defined in
the Pledge Agreement) and that its membership or partnership interest shall at
all times be general intangibles under the UCC.
Dated:_______, 1997 [NAME OF PLEDGED ENTITY]
By:_______________________
Title:_________________
40
LDM LP PLEDGE AGREEMENT
This LDM LP PLEDGE AGREEMENT, dated as of January 22, 1997 (together with
all amendments, if any, from time to time hereto, this "Agreement") between LDM
Canada Limited Partnership, a Michigan limited partnership corporation (the
"Pledgor") in favor of BANKAMERICA BUSINESS CREDIT, INC. in its capacity as
Agent for Lenders ("Agent").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Guarantee, dated as of January 22, 1997
(the "LDM LP Guarantee"), made by the Pledgor, the Pledgor has provided a
guarantee of the payment of the Obligations under the Loan and Security
Agreement dated as of January 22, 1997, by and among the Pledgor, the Agent and
the Persons signatory thereto from time to time as Lenders (as from time to
time amended, restated, supplemented or otherwise modified (the "Loan and
Security Agreement");
WHEREAS, the Pledgor is the record and beneficial owner of all the shares
of stock of the entity (the "Pledged Entity") described in of Schedule I
hereto;
WHEREAS, the Pledgor benefits from the credit facilities made available to
the Borrower through the Loan and Security Agreement;
WHEREAS, it is a condition to the making of Loans and the incurrence of
Obligations relating to the issuance of Letters of Credit under the Loan and
Security Agreement that the Pledgor shall have executed and delivered this
Agreement and granted the security interest contemplated hereby to secure the
obligations of the Pledgor under the LDM LP Guarantee;
NOW, THEREFORE, in consideration of the premises and the covenants
hereinafter contained and to induce Lenders to make Loans and to incur
Obligations relating to the issuance of Letter of Credit under the Loan and
Security Agreement, it is agreed as follows:
1. Definitions. Unless otherwise defined herein, terms defined in the
Loan and Security Agreement are used herein as therein defined, and the
following shall have (unless otherwise provided elsewhere in this Agreement)
the following respective meanings (such meanings being equally applicable to
both the singular and plural form of the terms defined):
"Bankruptcy Code" means title 11, United States Code, as amended
from time to time, and any successor statute thereto.
"Pledged Collateral" has the meaning assigned to such term in
Section 2 hereof.
41
"Pledged Shares" means those shares listed on Part A of Schedule I
hereto.
"Secured Obligations" has the meaning assigned to such term in
Section 3 hereof.
2. Pledge. The Pledgor hereby pledges to the Agent, and grants to the
Agent for itself and the benefit of Lenders, a first priority security interest
in all of the following (collectively, the "Pledged Collateral"):
(i) the Pledged Shares and the certificates representing the
Pledged Shares, and all dividends, distributions, cash, instruments
and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange
for any or all of the Pledged Shares; and
(ii) such portion, as determined by the Agent as provided in
Section 6(d) below, of any additional shares of stock of the
Pledged Entity from time to time acquired by the Pledgor in any
manner (which shares shall be deemed to be part of the Pledged
Shares), and the certificates representing such additional shares,
and all dividends, distributions, cash, instruments and other
property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all
of such shares.
3. Security for Obligations. This Agreement secures, and the Pledged
Collateral is security for, the prompt payment in full when due, whether at
stated maturity, by acceleration or otherwise, and performance of all
Obligations of any kind of the Pledgor under or in connection with the Loan and
Security Agreement and the other Loan Documents and all obligations of the
Pledgor now or hereafter existing under this Agreement including, without
limitation, all fees, costs and expenses whether in connection with collection
actions hereunder or otherwise (collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. All certificates representing or
evidencing the Pledged Shares shall be delivered to and held by or on behalf of
the Agent, for itself and the benefit of Lenders, pursuant hereto. All pledged
shares shall be accompanied by duly executed instruments of transfer or
assignment in blank, all in form and substance satisfactory to the Agent.
5. Representations and Warranties. The Pledgor represents and
warrants to the Agent that:
(a) The Pledgor is, and at the time of delivery of the Pledged
Shares to the Agent will be, the sole holder of record and the sole
beneficial owner of such Pledged Collateral pledged by the Pledgor free
and clear of any Lien thereon or affecting the title thereto, except for
any Lien created by this Agreement; the Pledgor is and at the time of
delivery of the Pledged Debt to the Agent will be, the sole owner of such
Pledged Collateral free and clear of any Lien thereon or affecting title
thereto, except for any Lien created by this Agreement;
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(b) All of the Pledged Shares have been duly authorized, validly
issued and are fully paid and non-assessable;
(c) The Pledgor has the right and requisite authority to pledge,
assign, transfer, deliver, deposit and set over the Pledged Collateral
pledged by the Pledgor to the Agent as provided herein;
(d) None of the Pledged Shares has been issued or transferred in
violation of the securities registration, securities disclosure or
similar laws of any jurisdiction to which such issuance or transfer may
be subject;
(e) All of the Pledged Shares are presently owned by the Pledgor,
and are presently represented by the stock certificates listed on
Schedule I hereto. As of the date hereof, there are no existing options,
warrants, calls or commitments of any character whatsoever relating to
the Pledged Shares;
(f) No consent, approval, authorization or other order of any Person
and no consent, authorization, approval, or other action by, and no
notice to or filing with, any governmental authority is required (i) for
the pledge by the Pledgor of the Pledged Collateral pursuant to this
Agreement or for the execution, delivery or performance of this Agreement
by the Pledgor, or (ii) for the exercise by the Agent of the voting or
other rights provided for in this Agreement or the remedies in respect of
the Pledged Collateral pursuant to this Agreement, except as may be
required in connection with such disposition by laws affecting the
offering and sale of securities generally;
(g) The pledge, assignment and delivery of the Pledged Collateral
pursuant to this Agreement will create a valid first priority Lien on and
a first priority perfected security interest in the Pledged Collateral
pledged by the Pledgor, and the proceeds thereof, securing the payment of
the Secured Obligations, subject to no other Lien or security interest;
(h) This Agreement has been duly authorized, executed and delivered
by the Pledgor and constitutes a legal, valid and binding obligation of
the Pledgor enforceable in accordance with its terms; and
(i) The Pledged Shares constitute 99% of the issued and outstanding
shares of Stock of the Pledged Entity.
The representations and warranties set forth in this Section 5 shall
survive the execution and delivery of this Agreement.
6. Covenants. The Pledgor covenants and agrees that until the Pledge
Termination Date (as defined in Section 11):
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(a) Without the prior written consent of the Agent, the Pledgor will
not sell, assign, transfer, pledge, or otherwise encumber any of its
rights in or to the Pledged Collateral, or any unpaid dividends, interest
or other distributions or payments with respect to the Pledged Collateral
or xxxxx x Xxxx in the Pledged Collateral, unless otherwise expressly
permitted by the Loan and Security Agreement;
(b) The Pledgor will, at its expense, promptly execute, acknowledge
and deliver all such instruments and take all such actions as the Agent
from time to time may request in order to ensure to the Agent and Lenders
the benefits of the Liens in and to the Pledged Collateral intended to be
created by this Agreement, including the filing of any necessary UCC or
PPSA financing statements, which may be filed by the Agent with or (to
the extent permitted by law) without the signature of the Pledgor, and
will cooperate with the Agent, at the Pledgor's expense, in obtaining all
necessary approvals and making all necessary filings under federal or
state law in connection with such Liens or any sale or transfer of the
Pledged Collateral;
(c) The Pledgor has and will defend the title to the Pledged
Collateral and the Liens of the Agent in the Pledged Collateral against
the claim of any Person and will maintain and preserve such Liens; and
(d) The Pledgor will, upon obtaining any additional shares of stock
of the Pledged Entity, which shares are not already Pledged Collateral,
promptly (and in any event within three (3) Business Days) deliver to the
Agent a Pledge Amendment, duly executed by the Pledgor, in substantially
the form of Schedule II hereto (a "Pledge Amendment") in respect of any
such additional shares, pursuant to which the Pledgor shall pledge to the
Agent all of such additional shares. The Pledgor hereby authorizes the
Agent to attach each Pledge Amendment to this Agreement and agrees that
all Pledged Shares listed on any Pledge Amendment delivered to the Agent
shall for all purposes hereunder be considered Pledged Collateral.
7. The Pledgor's Rights. As long as no Default or Event of Default shall
have occurred and be continuing and until written notice shall be given to the
Pledgor in accordance with Section 8(a) hereof:
(a) The Pledgor shall have the right, from time to time, to vote and
give consents with respect to the Pledged Collateral, or any part thereof
for all purposes not inconsistent with the provisions of this Agreement,
the Loan and Security Agreement or any other Loan Document; provided,
however, that no vote shall be cast, and no consent shall be given or
action taken, which would have the effect of impairing the position or
interest of the Agent in respect of the Pledged Collateral or which would
authorize or effect (unless and to the extent expressly permitted by the
Loan and Security Agreement):
(i) the dissolution or liquidation, in whole or in part, of
the Pledged Entity;
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44
(ii) the consolidation or merger of the Pledged Entity with
any other Person;
(iii) the sale, disposition or encumbrance of all or
substantially all of the assets of the Pledged Entity, except for
Liens in favor of the Agent;
(iv) any change in the authorized number of shares, the stated
capital or the authorized share capital of the Pledged Entity or
the issuance of any additional shares of its Stock; or
(v) the alteration of the voting rights with respect to the
Stock of the Pledged Entity; and
(b)(i) The Pledgor shall be entitled, from time to time, to collect
and receive for its own use all cash dividends paid in respect of the
Pledged Shares to the extent not in violation of the Loan and Security
Agreement other than any and all: (A) dividends paid or payable other
than in cash in respect of any Pledged Collateral, and instruments and
other property received, receivable or otherwise distributed in respect
of, or in exchange for, any Pledged Collateral; (B) dividends and other
distributions paid or payable in cash in respect of any Pledged Shares in
connection with a partial or total liquidation or dissolution or in
connection with a reduction of capital, capital surplus or paid-in
capital of the Pledged Entity; and (C) cash paid, payable or otherwise
distributed, in respect of, or in redemption of, or in exchange for, any
Pledged Collateral; provided, however, that until actually paid all
rights to such distributions shall remain subject to the Lien created by
this Agreement; and
(ii) all dividends (other than such cash dividends as are permitted
to be paid to the Pledgor in accordance with clause (i) above) and all
other distributions in respect of any of the Pledged Shares, whenever
paid or made, shall be delivered to the Agent to hold as Pledged
Collateral and shall, if received by the Pledgor, be received in trust
for the benefit of the Agent, be segregated from the other property or
funds of the Pledgor, and be forthwith delivered to the Agent as Pledged
Collateral in the same form as so received (with any necessary
indorsement).
8. Defaults and Remedies.
(a) Upon the occurrence of an Event of Default and during the
continuation of such Event of Default, then on or at any time after such
declaration (provided that such declaration is not rescinded by the
Agent) and concurrently with written notice to the Pledgor, the Agent
(personally or through an agent) is hereby authorized and empowered to
transfer and register in its name or in the name of its nominee the whole
or any part of the Pledged Collateral, to exchange certificates or
instruments representing or evidencing Pledged Collateral for
certificates or instruments of smaller or larger denominations, to
exercise the voting and all other rights as stockholder with respect
thereto, to collect and receive all cash dividends, interest, principal
and other distributions made thereon, to sell in
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45
one or more sales after ten (10) days' notice of the time and place of
any public sale or of the time at which a private sale is to take place
(which notice the Pledgor agrees is commercially reasonable) the whole or
any part of the Pledged Collateral and to otherwise act with respect to
the Pledged Collateral as though the Agent was the outright owner
thereof, the Pledgor hereby irrevocably constituting and appointing the
Agent as the proxy and attorney-in-fact of the Pledgor, with full power
of substitution to do so, and which appointment shall remain in effect
until the Pledge Termination Date; provided, however, that Agent shall
not have any duty to exercise any such right or to preserve the same and
shall not be liable for any failure to do so or for any delay in doing
so. Any sale shall be made at a public or private sale at the Agent's
place of business, or at any place to be named in the notice of sale,
either for cash or upon credit or for future delivery at such price as
the Agent may deem fair, and the Agent may be the purchaser of the whole
or any part of the Pledged Collateral so sold and hold the same
thereafter in its own right free from any claim of the Pledgor or any
right of redemption. Each sale shall be made to the highest bidder, but
the Agent reserves the right to reject any and all bids at such sale
which, in its discretion, it shall deem inadequate. Demands of
performance, except as otherwise herein specifically provided for,
notices of sale, advertisements and the presence of property at sale are
hereby waived and any sale hereunder may be conducted by an auctioneer or
any officer or agent of the Agent.
(b) If, at the original time or times appointed for the sale of the
whole or any part of the Pledged Collateral, the highest bid, if there be
but one sale, shall be inadequate to discharge in full all the Secured
Obligations, or if the Pledged Collateral be offered for sale in lots, if
at any of such sales, the highest bid for the lot offered for sale would
indicate to the Agent, in its discretion, that the proceeds of the sales
of the whole of the Pledged Collateral would be unlikely to be sufficient
to discharge all the Secured Obligations, the Agent may, on one or more
occasions and in its discretion, postpone any of said sales by public
announcement at the time of sale or the time of previous postponement of
sale, and no other notice of such postponement or postponements of sale
need be given, any other notice being hereby waived; provided, however,
that any sale or sales made after such postponement shall be after ten
(10) days' notice to the Pledgor.
(c) If, at any time when the Agent in its sole discretion
determines, following the occurrence and during the continuance of an
Event of Default, that, in connection with any actual or contemplated
exercise of its rights (when permitted under this Section 8) to sell the
whole or any part of the Pledged Shares hereunder, it is necessary or
advisable to effect a public registration of all or part of the Pledged
Collateral pursuant to the Securities Act of 1933, as amended (or any
similar statute then in effect) (the "Act"), the Pledgor shall, in an
expeditious manner, cause the Pledged Entities to:
(i) Prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement with respect
to the Pledged Shares and in good faith use commercially reasonable
efforts to cause such registration statement to become and remain
effective;
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46
(ii) Prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such
registration statement effective and to comply with the provisions
of the Act with respect to the sale or other disposition of the
Pledged Shares covered by such registration statement whenever the
Agent shall desire to sell or otherwise dispose of the Pledged
Shares;
(iii) Furnish to the Agent such numbers of copies of a
prospectus and a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as the Agent may
request in order to facilitate the public sale or other disposition
of the Pledged Shares by the Agent;
(iv) Use commercially reasonable efforts to register or
qualify the Pledged Shares covered by such registration statement
under such other securities or blue sky laws of such jurisdictions
within the United States and Puerto Rico as the Agent shall
request, and do such other reasonable acts and things as may be
required of it to enable the Agent to consummate the public sale or
other disposition in such jurisdictions of the Pledged Shares by
the Agent;
(v) Furnish, at the request of the Agent, on the date that
shares of the Pledged Collateral are delivered to the underwriters
for sale pursuant to such registration or, if the security is not
being sold through underwriters, on the date that the registration
statement with respect to such Pledged Shares becomes effective,
(A) an opinion, dated such date, of the independent counsel
representing such registrant for the purposes of such registration,
addressed to the underwriters, if any, and in the event the Pledged
Shares are not being sold through underwriters, then to the Agent,
in customary form and covering matters of the type customarily
covered in such legal opinions; and (B) a comfort letter, dated
such date, from the independent certified public accountants of
such registrant, addressed to the underwriters, if any, and in the
event the Pledged Shares are not being sold through underwriters,
then to the Agent, in a customary form and covering matters of the
type customarily covered by such comfort letters and as the
underwriters or the Agent shall reasonably request. The opinion of
counsel referred to above shall additionally cover such other legal
matters with respect to the registration in respect of which such
opinion is being given as the Agent may reasonably request. The
letter referred to above from the independent certified public
accountants shall additionally cover such other financial matters
(including information as to the period ending not more than five
(5) Business Days prior to the date of such letter) with respect to
the registration in respect of which such letter is being given as
the Agent may reasonably request; and
(vi) Otherwise use commercially reasonable efforts to comply
with all applicable rules and regulations of the Commission, and
make available to its security holders, as soon as reasonably
practicable but not later than 18 months after the effective date
of the registration statement, an earnings statement covering the
period of at least 12 months beginning with the first full month
after the effective
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date of such registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Act.
(d) All expenses incurred in complying with Section 8(c) hereof,
including, without limitation, all registration and filing fees
(including all expenses incident to filing with the National Association
of Securities Dealers, Inc.), printing expenses, fees and disbursements
of counsel for the registrant, the fees and expenses of counsel for the
Agent, expenses of the independent certified public accountants
(including any special audits incident to or required by any such
registration) and expenses of complying with the securities or blue sky
laws or any jurisdictions, shall be paid by the Pledgor.
(e) If, at any time when the Agent shall determine to exercise its
right to sell the whole or any part of the Pledged Collateral hereunder,
such Pledged Collateral or the part thereof to be sold shall not, for any
reason whatsoever, be effectively registered under the Act, the Agent
may, in its discretion (subject only to applicable requirements of law),
sell such Pledged Collateral or part thereof by private sale in such
manner and under such circumstances as the Agent may deem necessary or
advisable, but subject to the other requirements of this Section 8, and
shall not be required to effect such registration or to cause the same to
be effected. Without limiting the generality of the foregoing, in any
such event, the Agent in its discretion (x) may, in accordance with
applicable securities laws, proceed to make such private sale
notwithstanding that a registration statement for the purpose of
registering such Pledged Collateral or part thereof could be or shall
have been filed under said Act (or similar statute), (y) may approach and
negotiate with a single possible purchaser to effect such sale, and (z)
may restrict such sale to a purchaser who is an accredited investor under
the Act and who will represent and agree that such purchaser is
purchasing for its own account, for investment and not with a view to the
distribution or sale of such Pledged Collateral or any part thereof. In
addition to a private sale as provided above in this Section 8, if any of
the Pledged Collateral shall not be freely distributable to the public
without registration under the Act (or similar statute) at the time of
any proposed sale pursuant to this Section 8, then the Agent shall not be
required to effect such registration or cause the same to be effected
but, in its discretion (subject only to applicable requirements of law),
may require that any sale hereunder (including a sale at auction) be
conducted subject to restrictions:
(i) as to the financial sophistication and ability of any
Person permitted to bid or purchase at any such sale;
(ii) as to the content of legends to be placed upon any
certificates representing the Pledged Collateral sold in such sale,
including restrictions on future transfer thereof;
(iii) as to the representations required to be made by each
Person bidding or purchasing at such sale relating to that Person's
access to financial information about the Pledgor and such Person's
intentions as to the holding of the
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Pledged Collateral so sold for investment for its own account and
not with a view to the distribution thereof; and
(iv) as to such other matters as the Agent may, in its
discretion, deem necessary or appropriate in order that such sale
(notwithstanding any failure so to register) may be effected in
compliance with the Bankruptcy Code and other laws affecting the
enforcement of creditors' rights and the Act and all applicable
state securities laws.
(f) The Pledgor recognizes that the Agent may be unable to effect a
public sale of any or all the Pledged Collateral and may be compelled to
resort to one or more private sales thereof in accordance with clause (e)
above. The Pledgor also acknowledges that any such private sale may
result in prices and other terms less favorable to the seller than if
such sale were a public sale and, notwithstanding such circumstances,
agrees that any such private sale shall not be deemed to have been made
in a commercially unreasonable manner solely by virtue of such sale being
private. The Agent shall be under no obligation to delay a sale of any
of the Pledged Collateral for the period of time necessary to permit the
Pledged Entity to register such securities for public sale under the Act,
or under applicable state securities laws, even if the Pledgor and the
Pledged Entity would agree to do so.
(g) The Pledgor agrees to the maximum extent permitted by applicable
law that following the occurrence and during the continuance of an Event
of Default it will not at any time plead, claim or take the benefit of
any appraisal, valuation, stay, extension, moratorium or redemption law
now or hereafter in force in order to prevent or delay the enforcement of
this Agreement, or the absolute sale of the whole or any part of the
Pledged Collateral or the possession thereof by any purchaser at any sale
hereunder, and the Pledgor waives the benefit of all such laws to the
extent it lawfully may do so. The Pledgor agrees that it will not
interfere with any right, power and remedy of the Agent provided for in
this Agreement or now or hereafter existing at law or in equity or by
statute or otherwise, or the exercise or beginning of the exercise by the
Agent of any one or more of such rights, powers or remedies. No failure
or delay on the part of the Agent to exercise any such right, power or
remedy and no notice or demand which may be given to or made upon the
Pledgor by the Agent with respect to any such remedies shall operate as a
waiver thereof, or limit or impair the Agent's right to take any action
or to exercise any power or remedy hereunder, without notice or demand,
or prejudice its rights as against the Pledgor in any respect.
(h) The Pledgor further agrees that a breach of any of the covenants
contained in this Section 8 will cause irreparable injury to the Agent,
that the Agent shall have no adequate remedy at law in respect of such
breach and, as a consequence, agrees that each and every covenant
contained in this Section 8 shall be specifically enforceable against the
Pledgor, and the Pledgor hereby waives and agrees not to assert any
defenses against an action for specific performance of such covenants
except for a defense that the Secured Obligations are not then due and
payable in accordance with the agreements and instruments governing and
evidencing such obligations.
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9. Waiver. No delay on the Agent's part in exercising any power of sale,
Lien, option or other right hereunder, and no notice or demand which may be
given to or made upon the Pledgor by the Agent with respect to any power of
sale, Lien, option or other right hereunder, shall constitute a waiver thereof,
or limit or impair the Agent's right to take any action or to exercise any
power of sale, Lien, option, or any other right hereunder, without notice or
demand, or prejudice the Agent's rights as against the Pledgor in any respect.
10. Assignment. The Agent may assign, indorse or transfer any instrument
evidencing all or any part of the Secured Obligations as provided in, and in
accordance with, the Loan and Security Agreement, and the holder of such
instrument shall be entitled to the benefits of this Agreement.
11. Termination. Immediately following the payment in full, in cash of
all Secured Obligations on or after the Termination Date (as defined in the
Loan and Security Agreement) (the "Pledge Termination Date"), the Agent shall
deliver to the Pledgor the Pledged Collateral pledged by the Pledgor at the
time subject to this Agreement and all instruments of assignment executed in
connection therewith, free and clear of the Liens hereof and, except as
otherwise provided herein, all of the Pledgor's obligations hereunder shall at
such time terminate.
12. Lien Absolute. All rights of the Agent hereunder, and all obligations
of the Pledgor hereunder, shall be absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of the Loan and Security
Agreement, any other Loan Document or any other agreement or instrument
governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or in any
other term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the Loan and
Security Agreement, any other Loan Document or any other agreement or
instrument governing or evidencing any Secured Obligations;
(c) any exchange, release or non-perfection of any other Collateral,
or any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Secured Obligations; or
(d) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, the Pledgor.
13. Release. Pledgor consents and agrees that the Agent may at any time,
or from time to time, in its discretion:
(a) renew, extend or change the time of payment, and/or the manner,
place or terms of payment of all or any part of the Secured Obligations;
and
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(b) exchange, release and/or surrender all or any of the Collateral
(including the Pledged Collateral), or any part thereof, by whomsoever
deposited, which is now or may hereafter be held by the Agent in
connection with all or any of the Secured Obligations; all in such manner
and upon such terms as the Agent may deem proper, and without notice to
or further assent from the Pledgor, it being hereby agreed that the
Pledgor shall be and remain bound upon this Agreement, irrespective of
the value or condition of any of the Collateral, and notwithstanding any
such change, exchange, settlement, compromise, surrender, release,
renewal or extension, and notwithstanding also that the Secured
Obligations may, at any time, exceed the aggregate principal amount
thereof set forth in the Loan and Security Agreement, or any other
agreement governing any Secured Obligations. The Pledgor hereby waives
notice of acceptance of this Agreement, and also presentment, demand,
protest and notice of dishonor of any and all of the Secured Obligations,
and promptness in commencing suit against any party hereto or liable
hereon, and in giving any notice to or of making any claim or demand
hereunder upon the Pledgor. No act or omission of any kind on the
Agent's part shall in any event affect or impair this Agreement.
14. Reinstatement. This Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or against the
Pledgor or the Pledged Entity for liquidation or reorganization, should the
Pledgor or the Pledged Entity become insolvent or make an assignment for the
benefit of creditors or should a receiver or trustee be appointed for all or
any significant part of the Pledgor's or the Pledged Entity's assets, and shall
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Secured Obligations, or any part thereof, is,
pursuant to applicable law, rescinded or reduced in amount, or must otherwise
be restored or returned by any obligee of the Secured Obligations, whether as a
"voidable preference", "fraudulent conveyance", or otherwise, all as though
such payment or performance had not been made. In the event that any payment,
or any part thereof, is rescinded, reduced, restored or returned, the Secured
Obligations shall be reinstated and deemed reduced only by such amount paid and
not so rescinded, reduced, restored or returned.
15. Miscellaneous.
(a) The Agent may execute any of its duties hereunder by or through
agents or employees and shall be entitled to advice of counsel concerning
all matters pertaining to its duties hereunder.
(b) The Pledgor agrees to promptly reimburse Agent for actual
out-of-pocket expenses, including, without limitation, reasonable counsel
fees, incurred by Agent in connection with the administration and
enforcement of this Agreement.
(c) Neither the Agent, nor any of its respective officers,
directors, employees, agents or counsel shall be liable for any action
lawfully taken or omitted to be taken by it or them hereunder or in
connection herewith, except for its or their own gross negligence or
willful misconduct.
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(d) THIS AGREEMENT SHALL BE BINDING UPON THE PLEDGOR AND ITS
SUCCESSORS AND ASSIGNS (INCLUDING A DEBTOR-IN-POSSESSION ON BEHALF OF THE
PLEDGOR), AND SHALL INURE TO THE BENEFIT OF, AND BE ENFORCEABLE BY, THE
AGENT AND ITS SUCCESSORS AND ASSIGNS, AND SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
ILLINOIS APPLICABLE TO CONTRACTS MADE AND PERFORMED IN THAT STATE, AND
NONE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT MAY BE WAIVED, ALTERED,
MODIFIED OR AMENDED EXCEPT IN WRITING DULY SIGNED FOR AND ON BEHALF OF
THE AGENT AND THE PLEDGOR.
16. Severability. If for any reason any provision or provisions hereof
are determined to be invalid and contrary to any existing or future law, such
invalidity shall not impair the operation of or effect those portions of this
Agreement which are valid.
17. Notices. Except as otherwise provided herein, whenever it is provided
herein that any notice, demand, request, consent, approval, declaration or
other communication shall or may be given to or served upon any of the parties
by any other party, or whenever any of the parties desires to give or serve
upon any other a communication with respect to this Agreement, each such
notice, demand, request, consent, approval, declaration or other communication
shall be in writing and either shall be delivered in person or sent by
registered or certified mail, return receipt requested, postage prepaid, or by
facsimile transmission and confirmed by facsimile transmission answer back
addressed (i) with respect to the Pledgor, LDM Canada Limited Partnership, LDM
Technologies, Inc., 0000 Xxxxxxxxx Xxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxxxx 00000,
Attention: Xxxxxx Xxxxx, Fax No.: (000) 000-0000, Tel. No. (000) 000-0000, and
(ii) with respect to the Agent and the Lender, as provided in Section 15.8 of
the Loan and Security Agreement, or at such other address as may be substituted
by notice given as herein provided. The giving of any notice required
hereunder may be waived in writing by the party entitled to receive such
notice. Every notice, demand, request, consent, approval, declaration or other
communication hereunder shall be deemed to have been duly given or served on
the date on which personally delivered, transmitted and confirmed by facsimile
transmission answerback or three (3) Business Days after the same shall have
been deposited in the United States mail. Failure or delay in delivering
copies of any notice, demand, request, consent, approval, declaration or other
communication to the persons designated above to receive copies shall in no way
adversely affect the effectiveness of such notice, demand, request, consent,
approval, declaration or other communication.
18. Section Titles. The Section titles contained in this Agreement are
and shall be without substantive meaning or content of any kind whatsoever and
are not a part of the agreement between the parties hereto.
19. Counterparts. This Agreement may be executed in any number of
counterparts, which shall, collectively and separately, constitute one
agreement.
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20. Benefit of Lenders. All security interests granted or contemplated
hereby shall be for the benefit of the Agent and Lenders, and all proceeds or
payments realized from the Pledged Collateral in accordance herewith shall be
applied to the Obligations in accordance with the terms of the Loan and
Security Agreement.
* * *
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first written above.
LDM CANADA LIMITED PARTNERSHIP
By: LDM HOLDINGS, L.L.C.,
its General Partner
By: LDM TECHNOLOGIES, INC.,
its Member
By: /s/ Xxx Xxxxxx
---------------------------------
Name: Xxx Xxxxxx
---------------------------
Title: Secretary
--------------------------
Accepted and Acknowledged by:
BANKAMERICA BUSINESS CREDIT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
----------------------------
Title: Senior Vice President
---------------------------
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SCHEDULE I
PLEDGED SHARES
Class Stock Certificate Number Percentage of
Pledged Entity of Stock Number(s) of Shares Outstanding Shares
-------------------- -------- ----------------- --------- ------------------
LDM Technologies
Company Common 1 9,900 99%
55
SCHEDULE II
PLEDGE AMENDMENT
This Pledge Amendment, dated ________________, ___ is delivered pursuant
to Section 6(d) of the Pledge Agreement referred to below. The undersigned
hereby certifies that the representations and warranties in Section 5 of the
Pledge Agreement are and continue to be true and correct, both as to the
promissory notes, instruments and shares pledged prior to this Pledge Amendment
and as to the promissory notes, instruments and shares pledged pursuant to this
Pledge Amendment. The undersigned further agrees that this Pledge Amendment
may be attached to that certain Pledge Agreement, dated January __, 1997,
between undersigned, as the Pledgor, and BankAmerica Business Credit, Inc., as
the Agent, and that the Pledged Shares and Pledged Debt listed on this Pledge
Amendment shall be and become a part of the Pledged Collateral referred to in
said Pledge Agreement and shall secure all Secured Obligations referred to in
said Pledge Agreement. The undersigned acknowledges that any promissory notes,
instruments or shares not included in the Pledged Collateral at the discretion
of the Agent may not otherwise be pledged or otherwise used as security by the
Pledgor.
LDM CANADA LIMITED PARTNERSHIP
By: LDM Holdings, L.L.C.,
Its General Partner
By:_________________________________
Name: ___________________________
Title: __________________________
Name and Class Certificate Number
Address of the Pledgor Pledged Entity of Stock Number(s) of Shares
---------------------- -------------- -------- ----------- ---------
