___________________________________________________________________________
Silicon Valley Bank Exhibit 10(k)
Pledge Agreement
Pledgor: America's Work Exchange, Inc.
Address: 0000 Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Date: July 31, 2000
THIS PLEDGE AGREEMENT ("Pledge Agreement"), dated the above date, is
entered into between SILICON VALLEY BANK ("Silicon"), whose address is 0000
Xxxxxx Xxxxx, Xxxxx Xxxxx, XX 00000, and the pledgor named above ("Pledgor"),
whose address is set forth above.
1. Pledge of Securities. Pledgor shall concurrently deliver to Silicon
the stock certificates and other securities listed on Exhibit A hereto, together
with duly executed instruments of assignment thereof to Silicon (which together
with all replacements and substitutions therefor are hereinafter referred to as
the "Securities") provided, however, if no Event of Default has occurred,
Pledgor shall be allowed to sell the Securities within the first 90 days after
the date of this Agreement; therefore, Pledgor shall be allowed to retain
possession of the Securities for 90 days after the date of this Agreement, and
immediately thereafter, Pledgor shall deliver the Securities, or the remaining
portion thereof, to Silicon in accordance with the terms hereof. Pledgor hereby
pledges to Silicon and grants Silicon a security interest in the Securities, and
all rights and remedies relating to, or arising out of, any and all of the
foregoing, and all proceeds thereof and all replacements and substitutions
therefor (collectively, the "Collateral") to secure the payment and performance
of all debts, duties, obligations, liabilities, representations, warranties and
guaranties of Pledgor to Silicon, heretofore, now, or hereafter made, incurred
or created, of every kind and nature (collectively, the "Obligations"),
including, but not limited to, those arising under the Continuing Guaranty of
even date with respect to NetPlex Systems, Inc. (the "Guaranty"). Any and all
stock dividends, rights, warrants, options, puts, calls, conversion rights and
other securities and any and all property and money distributed or delivered
with respect to the Securities or issued upon the exercise of any puts, calls,
conversion rights, options, warrants or other rights included in or pertaining
to the Securities shall be included in the term "Securities" as used herein and
shall be subject to this Pledge Agreement, and Pledgor shall deliver the same to
Silicon immediately upon receipt thereof together with any necessary instruments
of transfer. Pledgor hereby acknowledges that the acceptance of the pledge of
the Securities by Silicon shall not constitute a commitment of any kind by
Silicon to permit Pledgor to incur Obligations.
*provided however, if no Event of Default has occurred, Pledgor shall be
allowed to sell the Securities within the first 90 days after the date of this
Agreement: therefore, Pledgor shall be allowed to retain possession of the
Securities for 90 days after the date of this Agreement, and immediately
thereafter, Pledgor shall deliver the Securities, of the remaining portion
thereof, to Silicon in accordance with the terms hereof.
2. Voting and Other Rights. Pledgor shall have the right to exercise all
voting rights with respect to the Securities, provided no Event of Default (as
hereinafter defined) has occurred. Upon the occurrence of any Event of Default,
Silicon shall have the right (but not any obligation) to exercise all voting
rights with respect to the Securities. Provided no Event of Default has
occurred, Pledgor shall have the right to exercise all puts, calls, straddles,
conversion rights, options, warrants, and other rights and remedies with respect
to the Securities, provided Pledgor obtains the prior written consent of Silicon
thereto. Silicon shall have no responsibility or liability whatsoever for the
exercise of, or failure to exercise, any puts, calls, straddles, conversion
rights, options, warrants, rights to vote or consent, or other rights with
respect to any of the Securities. Whether or not an Event of Default has
occurred, Silicon shall have the right from time to time to transfer all or any
part of the Securities to Silicon's own name or the name of its nominee.
3. Representations and Warranties. Pledgor hereby represents and warrants
to Silicon that Pledgor now has, and throughout the term of this Agreement will
at all times have, good title to the Securities and the other Collateral, free
and clear of any and all security interests, liens and claims of any kind
whatsoever.
4. Events of Default. If any one or more of the following events shall
occur, any such event shall constitute an Event of Default and Pledgor shall
provide Silicon with immediate notice thereof: (a) Any warranty, representation,
statement, report or certificate made or
-1-
Silicon Valley Bank Pledge Agreement
--------------------------------------------------------------------------
delivered to Silicon by Pledgor or any of Pledgor's officers, employees or
agents now or hereafter is incorrect, false, untrue or misleading in any
material respect; or (b) Pledgor shall fail to promptly pay or perform when due
part or all of any of the Obligations within any applicable cure period, or any
event of default shall occur under the Guaranty or any other present or future
instrument, document or agreement between Silicon and Pledgor.
5. Remedies. If an Event of Default shall occur, Pledgor shall give
immediate written notice thereof to Silicon. Upon the occurrence of an Event of
Default, and at any time thereafter, Silicon shall have the right, without
notice to or demand upon Pledgor, to exercise any one or more of the following
remedies: (a) accelerate and declare all or any part of the Obligations to be
immediately due, payable and performable, notwithstanding any deferred or
installment payments allowed by any agreement or instrument evidencing or
relating to any of the same; (b) sell or otherwise dispose of the Securities,
and other Collateral, in any market on which they are traded, through the Broker
or otherwise, and obtain payment of the proceeds thereof, (c) sell or otherwise
dispose of the Securities, and other Collateral, at a public or private sale,
for cash, or other property, or on credit, with the authority to adjourn or
postpone any such sale from time to time without notice other than oral
announcement at the time scheduled for sale. Silicon may directly or through any
affiliate purchase the Securities, and other Collateral, at any such public
disposition, and if permissible under applicable law, at any private
disposition. Pledgor and Silicon hereby agree that it shall conclusively be
deemed commercially reasonable for Silicon, in connection with any sale or
disposition of the Securities, to impose restrictions and conditions as to the
investment intent of a purchaser or bidder, the ability of a purchaser or bidder
to bear the economic risk of an investment in the Securities, the knowledge and
experience in business and financial matters of a purchaser or bidder, the
access of a purchaser or bidder to information concerning the issuer of the
Securities, as well as legend conditions and stop transfer instructions
restricting subsequent transfer of the Securities, and any other restrictions or
conditions which Silicon believes to be necessary or advisable in order to
comply with any state or federal securities or other laws. Pledgor acknowledges
that the foregoing restrictions may result in fewer proceeds being received upon
such sale then would otherwise be the case. Pledgor hereby agrees to provide to
Silicon any and all information required by Silicon in connection with any sales
of Securities by Silicon hereunder. If, after the occurrence of any Event of
Default, Rule 144 promulgated by the Securities and Exchange Commission (or any
other similar rule) is available for use by Silicon in connection with the sales
of any Securities hereunder, Pledgor agrees not to utilize Rule 144 in the sale
of any securities held by Pledgor of the same class as the Securities, without
the prior written consent of Silicon. Any and all attorneys' fees, expenses,
costs, liabilities and obligations incurred by Silicon in connection with the
foregoing shall be added to and become a part of the Obligations and shall be
due from Pledgor to Silicon upon demand.
6. Remedies, Cumulative; No Waiver. The failure of Silicon to enforce any
of the provisions of this Agreement at any time or for any period of time shall
not be construed to be a waiver of any such provision or the right thereafter to
enforce the same. All remedies hereunder shall be cumulative and shall be in
addition to all rights, powers and remedies given to Silicon by law.
7. Term. This Agreement and Silicon's rights hereunder shall continue in
full force and effect until all of the Obligations have been fully paid,
performed and discharged and the Guaranty and all other agreements between
Borrower and Silicon have terminated. Upon termination, Silicon shall return the
Collateral to Pledgor, with any necessary instruments of transfer. Upon any sale
of the Securities by Pledgor, Silicon shall return the Collateral (or the
applicable portion thereof) necessary to complete such sale, together with any
necessary instruments of transfer.
8. General Provisions. This Agreement and the documents referred to
herein are the entire and only agreements between Pledgor and Silicon with
respect to the subject matter hereof, and all representations, warranties,
agreements, or undertakings heretofore or contemporaneously made, with respect
to the subject matter hereof, which are not set forth herein or therein, are
superseded hereby. The terms and provisions hereof may not be waived, altered,
modified, or amended except in a writing executed by Pledgor and Silicon. All
rights, benefits and privileges hereunder shall inure to the benefit of and be
enforceable by Silicon and its successors and assigns and shall be binding upon
Pledgor and its successors and assigns; provided that Pledgor may not transfer
any of its rights hereunder without the prior written consent of Silicon.
Paragraph headings are used herein for convenience only. Pledgor acknowledges
that the same may not describe completely the subject matter of the applicable
paragraph, and the same shall not be used in any manner to construe, limit,
define or interpret any term or provision hereof. Pledgor shall upon demand
reimburse Silicon for all reasonable costs, fees and expenses (including without
limitation attorneys' fees, whether or not suit be brought), which are incurred
by Silicon in connection with, or arising out of, this Agreement. This Agreement
and all acts and transactions pursuant hereto and the rights and obligations of
the parties hereto shall be governed, construed, and interpreted in accordance
with the internal laws (and not conflict of laws rules) of the State of
California. Pledgor hereby agrees that all actions or proceedings relating
directly or indirectly hereto may, at the option of Silicon,
-2-
Silicon Valley Bank Pledge Agreement
--------------------------------------------------------------------------
be litigated in courts located within said State, and Pledgor hereby expressly
consents to the jurisdiction of any such court and consents to the service of
process in any such action or proceeding by personal delivery or by certified or
registered mailing directed to Pledgor at its last address known to Silicon.
9. Mutual Waiver of Right to Jury Trial. SILICON and Pledgor each hereby
waive the right to trial by jury in any action or proceeding based upon, arising
out of, or in any way relating to: (i) this Agreement; or (ii) any other present
or future instrument or agreement between SILICON and Pledgor; or (iii) any
conduct, acts or omissions of SILICON or Pledgor or any of their directors,
officers, employees, agents, attorneys or any other persons affiliated with
SILICON or Pledgor; in each of the foregoing cases, whether sounding in contract
or tort or otherwise.
PLEDGOR:
AMERICA'S WORK EXCHANGE
By /s/ Xxxxx X. Xxxxx
-------------------
Title Vice President
--------------
SILICON:
SILICON VALLEY BANK
By /s/ Xxxxx Xxxxx
---------------
Title Vice President
--------------
Exhibit A
---------
10,000,000 shares of common stock of Contractors Resources, Inc.
-3-
