EXHIBIT 10.2
AMENDED AND RESTATED
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (this "Agreement") is entered into as of
the 21st day of April, 1997 by and between Fill-Mor Holding, Inc. ("Pledgor" or
"Fill-Mor), a Delaware corporation and wholly-owned subsidiary of ARTRA GROUP
Incorporated, a Pennsylvania corporation ("ARTRA" ), AND Xxxxxx X. Xxxxxx
("Lender").
WITNESSETH:
WHEREAS, THE PARTIES HERETO ARE parties to a Stock Pledge
Agreement dated as of March 26, 1996 (the "Prior Pledge Agreement") pursuant to
which the Parties agreed to certain terms regarding the Pledged Shares as
defined therein;
WHEREAS, the parties hereto desire to amend and restate the Prior Pledge
Agreement, subject to the terms and conditions set forth herein;
WHEREAS, Pledgor is the owner of those shares of common stock more
fully described on Exhibit A attached hereto and by this reference incorporated
herein (the "Pledged Shares");
WHEREAS, Lender has agreed to make a loan in the amount of $5,000,000
(the "Loan"), to ARTRA to be evidenced by ARTRA's Promissory Note of even date
herewith in said principal amount, payable to the order of Lender with interest
as therein described (such Term Loan Promissory Note, together with any and all
renewals, extensions, replacements, supplements or additional notes are
hereinafter collectively referred to as the "Note"); and
WHEREAS, Lender has required as a condition, among others, to making
the Loan, and in order to secure the prompt and complete payment, observance and
performance of all of Pledgor's obligations and liabilities hereunder, ARTRA's
obligations and liabilities under the Note and under all of the other
instruments, documents and agreements executed and delivered by ARTRA and
Pledgor to Lender from time to time in connection with the Loan, that Pledgor
execute and deliver to Lender, this Stock Pledge Agreement pledging to Lender as
security for the Loan the Pledged Shares; and
WHEREAS, Pledgor has a material interest in, and will derive a material
benefit from, Lender making the Loan to ARTRA.
1
NOW, THEREFORE, for and in consideration of the foregoing premises, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
1. Grant of Security Interest.
To secure the prompt payment and performance of the following
(hereinafter collectively, the "Obligations"): (a) the prompt payment and
performance of the Note (and all extensions, renewals, modifications or
refinancings thereof or thereto), and all other amounts, liabilities and
obligations now or hereafter owed by ARTRA under the Note; and (b) the prompt
performance, observance and accuracy of Pledgor's covenants, warranties and
representations contained herein, Pledgor hereby pledges, assigns and delivers
to Lender and grants to Lender a first priority security interest in the Pledged
Shares and in all cash, securities, distributions, share dividends, payments,
rights and other property at any time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the Pledged Shares,
including, without limitation, shares issued as a result of any
reclassifications, split-up or any other corporate reorganization, and all
proceeds of the foregoing described collateral, of every kind and nature
whatsoever (hereinafter, all of the foregoing shall be referred to collectively
as the "Pledged Collateral"). Pledgor shall deliver promptly to Lender, in the
exact form received, all such securities or other property which comes into the
possession, custody or control of Pledgor. Pledgor agrees to execute and deliver
to Lender (i) stock powers appropriately endorsed in blank, with respect to the
Pledged Shares and (ii) such other documents of transfer as Lender may from time
to time request to enable Lender to transfer the Pledged Shares and the other
Pledged Collateral into its name or the name of its nominee.
2. Perfection of Security Interest.
Pledgor agrees (i) immediately to deliver to Lender all certificates
evidencing any of the Pledged Collateral which may at any time come into the
possession of Pledgor and (ii) to take such other steps as Lender may from time
to time reasonably request to perfect Lender's security interest in the Pledged
Collateral under applicable law. Each certificate shall be, accompanied by a
blank stock power executed by an authorized officer of FILL-MOR with signatures
guaranteed in form sufficient for transfer and accompanied by a certified
resolution of the Board of Directors of FILL-MOR authorizing such signatures.
3. Voting Rights.
During the term of this Agreement, Pledgor shall have the right to vote
the Pledged Shares and exercise any voting rights pertaining to the Pledged
Collateral, and to give consents, ratifications and waivers with respect
2
thereto, on all corporate questions for all purposes not inconsistent with the
terms of any agreements and documents executed in connection with the
transactions contemplated thereby. The Lender shall, at the request of Pledgor,
provide Pledgor with appropriate proxies and any other documents necessary or
appropriate to permit Pledgor to exercise the rights set forth in the preceding
sentence.
4. Dividends and Other Distributions.
With respect to cash dividends, Lender shall apply such dividends to
the Obligations of Pledgor in such manner as Lender, in its sole discretion,
shall determine. With respect to dividends or distributions other than cash,
such dividend or distribution shall be held by Lender as additional collateral;
and shall, upon receipt by Lender, become part of the Pledged Collateral.
Pledgor shall promptly remit to Lender any such dividend or other distribution
paid to Pledgor, and until so paid to Lender, Pledgor shall hold such dividend
or other distribution in trust for Lender.
5. Representations.
Pledgor warrants and represents to Lender as follows:
(a) Pledgor is, and at the time of delivery of the Pledged
Shares to Lender pursuant to Section 1 hereof will be, the sole holder of record
and the sole beneficial owner of the Pledged Collateral free and clear of any
lien (except for the lien created by this Agreement), claim, encumbrance,
covenant or restrictions of any kind (except restrictions imposed by the terms
of that certain Lock-up Agreement dated as of December 19, 1996, the terms of
which provide for the expiration of such restrictions on April 30, 1997, and
restrictions imposed by Federal and state securities laws applicable on the sale
of the Pledged Shares) thereon or affecting the title thereto;
(b) All of the Pledged Shares have been duly authorized,
validly issued are fully paid and non-assessable;
(c) Pledgor has the right and requisite authority and has
taken all required corporate actions to pledge, assign, transfer, deliver,
deposit and set over the Pledged Collateral to Lender as provided herein;
(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 for the pledge
by Pledgor of the Pledged Collateral pursuant to this Agreement or for the
execution, delivery or performance of this Agreement by Pledgor;
(e) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes the legal, valid and binding obligation of
Pledgor enforceable in according with its terms;
(f) Pledgor is a corporation duly organized, validly existing,
and in good standing in the State of Delaware, has full corporate power to own
its properties, to carry on its businesses, to execute, deliver and perform the
transactions under this Agreement and is duly qualified to do business and in
good standing in each jurisdiction in which the character of its properties or
transactions material to its business makes such qualification necessary;
(g) The stock powers delivered in connection with the Pledged
Shares are duly executed and give Lender the authority they purport to confer.
3
6. Pledged Shares Adjustments.
In the event that, during the term of this Agreement, any stock
dividend, reclassification, readjustment or other change is declared or made in
the capital structure of any issuer of the Pledged Shares (including, without
limitation, the issuance of additional shares of capital stock by any such
issuer), then Lender shall have a security interest in all new, substituted and
additional shares or other securities so issued, or acquired by Pledgor by
reason of any such change or exercise, and such shares or other securities shall
become part of the Pledged Collateral.
7. Events of Defaults.
Each of the following shall constitute an "Event of
Default" hereunder:
(a) ARTRA shall fail to pay when due any of the Obligations, including
any principal or interest due on the Note, and such failure shall not be fully
cured within seven (7) Business Days thereafter;.
(b) Lender shall fail to have an enforceable first lien on, or security
interest in, any of the Pledged Collateral.
(c) Any of the representations and warranties of Pledgor contained
herein shall be false or misleading.
(d) Pledgor fails or neglects to perform, keep or observe any of its
covenants, conditions or agreements contained in this Agreement and such failure
to perform, keep, or observe, as the case may be, shall not be fully cured
within seven (7) Business Days thereafter.
8. Event of Default Remedies.
Lender may, upon or at any time after the occurrence and during the
continuance of an Event of Default, at its option, transfer or register the
Pledged Collateral or any part thereof into its name with or without any
indication that such Pledged Collateral is subject to the security interest
hereunder. In addition, following the occurrence and during the continuance of
an Event of Default, Lender shall have such powers of sale and other powers as
may be conferred by applicable law. With respect to the Pledged Collateral or
any part thereof which shall then be in or shall thereafter come into the
possession or custody of Lender or which Lender shall otherwise have the ability
to transfer under applicable law, Lender may, in its sole discretion, without
notice following the occurrence and during the continuance of an Event of
Default, sell or cause the same to be sold at any exchange or broker's board or
at public or private sale, in one or more sales or lots, at such price as is
reasonable, for cash.
Any cash held by Lender as Pledged Collateral and all cash proceeds
received by Lender in respect of any sale of, collection from, or other
realization upon all or any part of the Pledged Collateral may, in the
4
discretion of Lender, be applied by Lender against all or any part of the
Obligations including all reasonable costs (including attorney's fees) incurred
by Lender in the enforcement of this Agreement, the Note, or the Option after
Borrower's default. Any surplus remaining after application of cash proceeds and
payments in full of the Obligations shall be paid to Pledgor.
9. Term.
This Agreement shall remain in full force and effect until all
of the Obligations shall have been paid in full, at which time Lender, at the
request of Pledgor, will execute and deliver to Pledgor a proper instrument or
instruments acknowledging the satisfaction and termination of this Agreement,
and will duly assign, transfer and deliver to Pledgor such of the Pledged
Collateral as may be in the possession of Lender and has not theretofore been
sold or otherwise applied or released pursuant to this Agreement, together with
any moneys at the time held by Lender hereunder.
10. Covenants.
Pledgor covenants and agrees that up to and through the date on which
this Agreement terminates:
(a)Without the prior written consent of Lender, Pledgor will not sell,
assign, transfer, pledge, exchange or otherwise encumber or restrict any of its
rights in or to the Pledged Collateral pledged or any unpaid dividends or other
distributions or payments with respect thereto or grant a security interest in
any therein except to Lender.
(b)Pledgor has and will defend the title to the Pledged Collateral and
the lien of Lender thereon against the claim of any person and will maintain and
preserve such lien until the termination of the pledge hereunder.
11. Definitions.
The singular shall include the plural and vice versa and any gender
shall include any other gender as the context may require.
12. Successors and Assigns.
This Agreement and all obligations of Pledgor hereunder shall be
binding upon its successors and shall, together with the rights and remedies of
Lender hereunder, inure to the benefit of Lender, all future holders of any
instrument evidencing any of the Obligations and its successors and assigns.
5
13. Applicable Law.
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of Illinois. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be held to be
prohibited or invalid under applicable law, such provision shall be ineffective
only to the extent of such prohibition or invalidity, without invalidating the
remainder of such provision or the remaining provisions of this Agreement.
14. Further Assurances.
Pledgor agrees that it will cooperate with Lender and will
execute and deliver, or cause to be executed and delivered, all such other stock
powers, proxies, instruments, and documents, and will take all such other
reasonable action as Lender may reasonably request from time to time in order to
carry out the provisions and purposes hereof. In addition to the foregoing,
Pledgor shall execute and deliver to Lender appropriate UCC Financing Statements
with respect to the Pledged Collateral.
15 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 with receipt acknowledged or
sent by registered or certified mail, return receipt requested, postage prepaid,
or by facsimile and confirmed by facsimile answerback addressed as below:
If to Pledgor:
Fill-Mor Holding, Inc.
c/o ARTRA GROUP Incorporated
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
telephone: (000) 000-0000
fax (000) 000-0000
with a copy to:
Xxxxxx, Xxxxxxxxx & Xxxxx, Ltd.
000 X. Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, Esq.
telephone (000) 000-0000
fax (000) 000-0000
6
If to Lender:
Xxxxxx X. Xxxxxx
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
16. Counterparts.
This Agreement may be executed in any number of separate counterparts,
which shall collectively constitute one and the same agreement.
17. Section Headings.
The descriptive headings of the sections of this Agreement are inserted
for convenience of reference only and shall not control or affect the meaning or
construction of any provisions hereof.
18. Consent to Jurisdiction.
The parties hereto agree that all legal actions or proceedings in any manner or
respect arising out of or related to this Agreement shall be brought and
litigated only in courts having situs in Xxxx County, Illinois; and the parties
hereto hereby consent to and submit to the jurisdiction of any local, state or
federal court located within Xxxx County, and the parties hereto hereby waives
any right the parties may have to transfer or change the venue of any such legal
action or proceeding.
19. Waiver of Jury Trial.
The parties hereto waive irrevocably the right to a trial by jury in any action
or proceeding to enforce or defend any rights under this Agreement or under any
amendment, instrument, document or agreement delivered or which may in the
future be delivered in connection herewith and agree that any such action or
proceeding shall be tried before a court and not before a jury.
7
IN WITNESS WHEREOF, Pledgor and Lender have executed this Agreement as
of the date first above written.
PLEDGOR:
FILL-MOR HOLDING, INC.:
By: _______________________________
Its: _______________________________
LENDER:
_______________________________
Xxxxxx X. Xxxxxx
8
EXHIBIT A
to
PLEDGE AGREEMENT
Description of Pledged Shares
Issuer No. of Shares Class of Shares Certificate No.
------ ------------- --------------- ---------------
Comforce Corporation 000,000 Xxxxxx XXX000, XX0000, CC0379,
CC0380 CC0381, CC0382,
CC0383, CC0384, CC0385,
CC0387, CC0390
9
