PLEDGE AGREEMENT
Exhibit 10.7
This
PLEDGE AGREEMENT (this
"Agreement") is made on November 21, 2008, by and between ANCHOR FUNDING SERVICES, INC.,
a Delaware limited liability company ("Pledgor"), and TEXTRON FINANCIAL CORPORATION,
a Delaware Corporation, as collateral and administrative agent (together
with its successors in such capacity, "Agent") for various financial
institutions (each a "Lender" and collectively, "Lenders") party from time to
time to the Loan Agreement (as defined below).
Recitals:
Anchor
Funding Services, LLC, a North Carolina limited liability company ("Borrower"),
Agent and Lenders are parties to a certain Loan and Security
Agreement dated the date hereof (as at any time amended, restated, supplemented
or otherwise modified, the "Loan Agreement"), pursuant to which Lenders may from
time to time make loans or extend other financial accommodations to or for the
benefit of Borrower.
To induce
Agent and Lenders to enter into the Loan Agreement, Pledgor has executed a
Continuing Guaranty Agreement of even date herewith in favor of Agent (as at any
time amended, restated, supplemented or otherwise modified, the "Parent
Guaranty"), pursuant to which Pledgor has guaranteed the payment and performance
of all of Borrower's Obligations under (and as defined in) the Loan
Agreement.
It is a
condition to Lenders' willingness to make loans and other financial
accommodations to or for the benefit of Borrower that Pledgor execute and
deliver this Agreement. To induce Lenders to make loans and otherwise
extend credit pursuant to the Loan Agreement, Pledgor has agreed to grant to
Agent a continuing security interest in and to the Pledged Collateral (as
hereinafter defined) as security for the timely payment and performance of the
Secured Obligations (as hereinafter defined).
NOW,
THEREFORE, for Ten Dollars ($10.00) in hand paid to Pledgor and in consideration
of the premises and mutual covenants herein contained and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and to secure the timely payment and performance of the Secured
Obligations (as hereinafter defined), Pledgor agrees as follows:
1. Definitions. Each
capitalized term used herein, unless otherwise defined herein, shall have
the meaning ascribed to such term in the Loan Agreement. As used
herein, the following terms shall have the following meanings:
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"Companies" shall mean
each of the entities identified as an "Issuer" on Annex A hereto, and
each such entity individually is referred to herein as a "Company".
"Equity Interest"
means the interest of (i) a shareholder in a corporation, (ii) a
partner (whether general or limited) in a partnership (whether general, limited
or limited liability), (iii) a member in a limited liability company, or
(iv) any other Person having any other form of equity security or ownership
interest.
"Organic Documents"
shall mean with respect to any Person, its charter, certificate or articles of
incorporation or formation, bylaws, articles of organization, limited liability
agreement, operating agreement, members agreement, shareholders agreement,
partnership agreement, certificate of partnership, certificate of formation,
voting trust, or similar agreement or instrument governing the formation or
operation of such Person.
"Pledged Collateral"
shall have the meaning ascribed to in Section 2 hereof.
"Power" shall have the
meaning ascribed to it in Section 2 hereof.
"Secured Obligations"
shall mean (a) all of the Obligations under (and as defined in) the Loan
Agreement, (b) all obligations of Pledgor now or hereafter existing under the
Parent Guaranty and (c) all obligations of Pledgor now or hereafter existing
under this Agreement.
2. Pledge;
Lender's Duties.
(a) Pledgor
hereby pledges to Agent, and hereby grants to Agent, for the benefit of itself
and Lenders, a security interest in all of the Equity Interests of the Companies
held by Pledgor and more particularly described on Annex A hereto and
all of Pledgor's options, if any, for the purchase of any Equity Interests of
the Companies, herewith delivered to Agent, and where certificated,
accompanied by powers ("Powers") duly executed in blank, with signatures
properly guaranteed, and all proceeds thereof and all dividends or distributions
at any time payable in connection therewith (said Equity Interests, Powers,
options, proceeds, dividends and distributions hereinafter collectively called
the "Pledged Collateral") as security for the due and punctual payment and
performance of the Secured Obligations.
(b) Agent
shall have no duty with respect to any of the Pledged Collateral other than the
duty to use reasonable care in the safe custody of any tangible items of the
Pledged Collateral in its possession. Without limiting the generality
of the foregoing, Agent shall be under no obligation to sell any of the Pledged
Collateral or otherwise to take any steps necessary to preserve the value of any
of the Pledged Collateral or to preserve rights in the Pledged Collateral
against any other Persons, but may do so at its option, and all expenses
incurred in connection therewith shall be for the sole account of
Pledgor.
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3. Voting
Rights. During the term of this Agreement, and so long as no
Event of Default shall exist, Pledgor shall have the right to vote all or any
portion of the Equity Interests on all corporate questions for all purposes not
inconsistent with the terms of this Agreement or any of the other Loan
Documents. To that end, if Agent transfers all or any portion of the
Pledged Collateral, into its name or the name of its nominee, to the extent
authorized to do so under this Agreement or any of the other Loan Documents,
Agent shall, upon the request of Pledgor, unless an Event of Default shall have
occurred, execute and deliver or cause to be executed and delivered to Pledgor,
proxies with respect to the Pledged Collateral. Pledgor hereby grants
to Agent, effective upon the occurrence and continuation of any Event of
Default, an IRREVOCABLE
PROXY pursuant to which Agent shall be entitled to exercise all voting
powers pertaining to the Pledged Collateral, including to call and attend all
meetings of the shareholders or members of the Companies to be held from time to
time with full power to act and vote in the name, place and stead of Pledgor
(whether or not the Equity Interests shall have been transferred into its name
or the name of its nominee or nominees), give all consents, waivers and
ratifications in respect of the Pledged Collateral and otherwise act with
respect thereto as though it were the outright owner thereof, and any and
all proxies theretofore executed by Agent shall terminate and thereafter be
null and void and of no effect whatsoever.
4. Collection
of Dividend Payments. During the term of this Agreement, and
so long as there shall not occur or exist any Event of Default, Pledgor shall
have the right to receive and retain any and all dividends and other
distributions payable by any Company on account of any of the Pledged Collateral
except as otherwise provided in the Loan Documents. Upon the
occurrence and continuation of any Event of Default, all dividends and other
distributions payable by any Company on account of any of the Pledged Collateral
shall be paid to Agent and any such sum received by Pledgor shall be deemed to
be held by Pledgor in trust for the benefit of Agent and shall be forthwith
turned over to Agent for application by Agent to the Secured Obligations in such
order of application as is specified in the Loan Agreement.
5. Representations
and Warranties of Pledgor. Pledgor warrants and represents to
Agent as follows (which representations and warranties shall be deemed
continuing): (a) Pledgor is the legal and beneficial owner of the
Pledged Collateral; (b) all of the Equity Interests have been duly and validly
issued, are fully paid and nonassessable, and are owned by Pledgor free of any
Liens except for Permitted Liens and Agent's security interest hereunder; (c)
the Pledged Collateral constitutes all of the issued and outstanding Equity
Interests of the Companies; (d) there are no contractual or charter restrictions
upon the voting rights or upon the transfer of any of the Pledged Collateral;
(e) Pledgor has the right to vote, pledge and grant a security interest in
or otherwise transfer the Pledged Collateral without the consent of any other
party and free of any Liens other than Permitted Liens and applicable
restrictions imposed by any Governmental Authority and without any restriction
under the Organic Documents of Pledgor or any Company or any agreement among
Pledgor's or any Company's shareholders, members or partners; (f) this Agreement
has been duly authorized, executed and delivered by Pledgor and constitutes a
legal, valid and binding obligation of Pledgor, enforceable in accordance with
its terms except to the extent that the enforceability thereof may be limited by
bankruptcy, insolvency or other similar laws of general application affecting
the enforcement of creditors' rights; (g) the execution, delivery and
performance by Pledgor of this Agreement and the exercise by Agent of its rights
and remedies hereunder do not and will not result in the violation of the
Organic Documents of Pledgor, any agreement, indenture, instrument or Applicable
Law by which Pledgor or any Company is bound or to which Pledgor or any Company
is subject (except Pledgor makes no representation or warranty about
Agent's prospective compliance with any federal or state laws or
regulations governing the sale or exchange of securities); (h) no consent,
filing, approval, registration or recording is required (x) for the pledge
by Pledgor of the Pledged Collateral pursuant to this Agreement or (y) to
perfect the Lien created by this Agreement; (i) none of the Pledged Collateral
is held or maintained in the form of a securities entitlement or credited to any
securities account; (j) none of the Pledged Collateral constituting membership
interests in a limited liability company or general or limited partnership
interests in a limited partnership or limited liability partnership is, nor has
the relevant Company elected to designate any of the Pledged Collateral as, a
"security" under (and as defined in) Article 8 of the UCC; and (k) unless a
Power is delivered in connection therewith, none of the Pledged Collateral is
evidenced by a certificate or other writing.
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6. Affirmative
Covenants of Pledgor. Until all of the Secured Obligations
have been satisfied in full and the Loan Agreement and the Parent Guaranty have
been terminated, Pledgor covenants that it will: (a) warrant and
defend at its own expense Agent's right, title, and security interest in and to
the Pledged Collateral against the claims of any Person; (b) deliver to
Agent promptly all written notices with respect to the Pledged Collateral, and
will promptly give written notice to Agent of any other notices received by
Pledgor with respect to the Pledged Collateral; and (c) deliver to Agent
promptly to hold under this Agreement any Equity Interests of any Company
subsequently acquired by Pledgor, whether acquired by Pledgor by virtue of the
exercise of any options included within the Pledged Collateral or otherwise
(which Equity Interests shall be deemed to be a part of the Pledged Collateral);
(d) if any of the Pledged Collateral constituting membership interests in a
limited liability company or general or limited partnership interests in a
limited partnership or limited liability partnership is hereafter designated by
the relevant Company as a "security" under (and as defined in) Article 8 of the
UCC, cause such Pledged Collateral to be certificated; and (e) if at any time
hereafter any of the Pledged Collateral that is not currently certificated
becomes certificated, deliver all certificates or other documents evidencing or
representing the Pledged Collateral to Agent, accompanied by Powers, all in form
and substance satisfactory to Agent.
7. Negative
Covenants of Pledgor. Until all of the Secured Obligations
have been satisfied in full and the Loan Agreement and the Parent Guaranty have
been terminated, Pledgor covenants that it will not, without the prior written
consent of Agent, (a) sell, convey or otherwise dispose of any of the Pledged
Collateral or any interest therein other than as permitted under the Loan
Agreement; (b) incur or permit to be incurred any Lien whatsoever upon or with
respect to any of the Pledged Collateral or the proceeds thereof, other than the
security interest created hereby and Permitted Liens; (c) consent to the
issuance by any Company of any new Equity Interests other than as permitted
under the Loan Agreement; (d) consent to any merger or other consolidation of
any Company with or into any corporation or other entity other than as permitted
under the Loan Agreement; (e) cause any Pledged Collateral to be held or
maintained in the form of a security entitlement or credited to any securities
account; (f) designate, or cause any Company to designate, any of the Pledged
Collateral constituting membership interests in a limited liability company or
general or limited partnership interests in a limited partnership or limited
liability partnership as a "security" under Article 8 of the UCC, unless such
Company has caused such Pledged Collateral to become certificated and has
complied with the requirements of Section 6(e) hereof with respect to such
Pledged Collateral; or (g) evidence, or permit any Company to evidence, any of
the Pledged Collateral that is not currently certificated, with any
certificates, instruments or other writings, unless such Company has complied
with the provisions of Section 6(e) of this Agreement.
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8. Irrevocable
Authorization and Instruction to Companies. To the extent that any
portion of the Pledged Collateral may now or hereafter consist of uncertificated
securities within the meaning of Article 8 of the UCC, Pledgor irrevocably
authorizes and instructs each Company to comply with any instruction received by
such Company from Agent with respect to such Pledged Collateral without any
other or further instructions from or consent of Pledgor, and Pledgor agrees
that Company shall be fully protected in so complying; provided, however, that Agent
agrees that Agent will not issue or deliver any instructions to any Company
except upon the occurrence and continuance of an Event of Default.
9. Subsequent
Changes Affecting Pledged Collateral. Pledgor hereby
represents to Agent that Pledgor has made its own arrangements for keeping
informed of changes or potential changes affecting the Pledged Collateral
(including rights to convert, rights to subscribe, payment of dividends and
distributions, reorganization or other exchanges, tender offers and voting
rights), and Pledgor agrees that Agent shall have no responsibility or liability
for informing Pledgor of any such changes or potential changes or for taking any
action or omitting to take any action with respect thereto. Agent
may, at any time that an Event of Default exists, at its option and without
notice to Pledgor, transfer or register the Pledged Collateral or any portion
thereof into its or its nominee's name with or without any indication that such
Pledged Collateral is subject to the security interest hereunder.
10. Equity
Interest Adjustments. If during the term of this Agreement any
dividend, reclassification, readjustment or other change is declared or made in
the capital structure of the Companies, or any option included within the
Pledged Collateral is exercised, or both, all new, substituted and additional
Equity Interests, or other securities, issued by reason of any such change or
exercise shall, if received by Pledgor, be held in trust for Agent's benefit and
shall be promptly delivered to and held by Agent under the terms of this
Agreement in the same manner as the Pledged Collateral originally pledged
hereunder.
11. Warrants,
Options and Rights. If during the term of this Agreement
subscription warrants or any other rights or options shall be issued or
exercised in connection with the Pledged Collateral, then such warrants, rights
and options shall be immediately assigned by Pledgor to Agent and all
certificates evidencing new Equity Interests or other securities so acquired by
Pledgor shall be immediately delivered to and held by Agent to be held under the
terms of this Agreement in the same manner as the Pledged Collateral originally
pledged hereunder.
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12. Registration. If
Agent determines that it is required to register under or otherwise comply in
any way with the Securities Act of 1933, as amended (the "Securities Act") or
any similar federal or state law, with respect to the securities included in the
Pledged Collateral prior to sale thereof by Agent, then upon the occurrence and
during the continuation of an Event of Default, Pledgor will use its best
efforts to cause any such registration to be effectively made, at no expense to
Agent, and to continue such registration effective for such time as may be
reasonably necessary in the reasonable opinion of Agent, and will reimburse
Agent for any expense incurred by Agent, including reasonable attorneys' fees
and accountants' fees and expenses, in connection therewith.
13. Consent. Pledgor
hereby consents that from time to time, before or after the occurrence or
existence of any Default or Event of Default, with or without notice to or
assent from Pledgor, any other security at any time held by or available to
Agent for any of the Secured Obligations may be exchanged, surrendered, or
released, and any of the Secured Obligations may be changed, altered, renewed,
extended, continued, surrendered, compromised, waived or released, in whole or
in part, as Agent may see fit, and Pledgor shall remain bound under this
Agreement and under the other Loan Documents notwithstanding any such exchange,
surrender, release, alteration, renewal, extension, continuance, compromise,
waiver or inaction, extension of further credit or other dealing.
14. Remedies
Upon Default. Upon the occurrence and during the continuation
of any Event of Default, (i) Agent shall have, in addition to any other rights
given by law or the rights given hereunder or under each of the other Loan
Documents, all of the rights and remedies with respect to the Pledged Collateral
of a secured party under the UCC and (ii) Agent may cause all or any part of the
Equity Interests held by it to be transferred into its name or the name of its
nominee or nominees. In addition, upon the occurrence and
continuation of an Event of Default, Agent may sell or cause the Pledged
Collateral, or any part thereof, which shall then be or shall thereafter come
into Agent's possession or custody, to be sold at any broker's board or at
public or private sale, in one or more sales or lots, at such price as Agent may
deem best, and for cash or on credit or for future delivery, and the purchaser
of any or all of the Pledged Collateral so sold shall thereafter hold the same
absolutely, free from any claim, encumbrance or right of any kind whatsoever or
Pledgor or arising through Pledgor. If any of the Pledged Collateral
is sold by Agent upon credit or for future delivery, Agent shall not be liable
for the failure of the purchaser to pay the same and in such event Agent may
resell such Pledged Collateral. Unless the Pledged Collateral
threatens to decline speedily in value or is or becomes of a type sold on a
recognized market, Agent will give Pledgor reasonable notice of the time and
place of any public sale thereof, or of the time after which any private sale or
other intended disposition is to be made. Any sale of the Pledged
Collateral conducted in conformity with reasonable commercial practices of
banks, insurance companies or other financial institutions disposing of property
similar to the Pledged Collateral shall be deemed to be commercially
reasonable. Any requirements of reasonable notice shall be met if
such notice is mailed to Pledgor, as provided in Section 22 below, at least ten
(10) days before the time of the sale or disposition. Any other
requirement of notice, demand or advertisement for sale is, to the extent
permitted by Applicable Law, waived. Agent may, in its own name, or
in the name of a designee or nominee, buy at any public sale of the Pledged
Collateral and, if permitted by Applicable Law, buy at any private sale
thereof. Pledgor will pay to Agent on demand all expenses (including
court costs and reasonable attorneys' fees and expenses) of, or incident to, the
enforcement of any of the provisions hereof and all other charges due against
the Pledged Collateral, including taxes, assessments or Liens upon the Pledged
Collateral and any expenses, including transfer or other taxes, arising in
connection with any sale, transfer or other disposition of Pledged
Collateral. In connection with any sale of Pledged Collateral by
Agent, Agent shall have the right to execute any document or form, in its name
or in the name of Pledgor, which may be necessary or desirable in connection
with such sale, including Form 144 promulgated by the Securities and Exchange
Commission. In view of the fact that federal and state securities
laws may impose certain restrictions on the method by which a sale of the
Pledged Collateral may be effected Pledgor agrees that Agent may, upon the
occurrence and continuation of an Event of Default, attempt to sell all or any
part of the Pledged Collateral by means of a private placement restricting the
bidders and prospective purchasers to those who will represent and agree that
they are accredited investors (as defined in Regulation D promulgated under the
Securities Act) purchasing for investment only and not for
distribution. Pledgor agrees that any such private sales may be at
prices and other terms less favorable to the seller than if sold at public sales
and that such private sales shall not by reason thereof be deemed not to have
been made in a commercially reasonable manner. 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 issuer of such securities to register such
securities for public sale under the Securities Act even if the issuer would
agree to do so. Agent shall apply the cash proceeds actually received
from any sale or other disposition to the reasonable expenses of retaking,
holding, preparing for sale, selling and the like, to reasonable attorneys'
fees, and all legal expenses, travel and other expenses which may be incurred by
Agent in attempting to collect the Secured Obligations or to enforce this
Agreement or in the prosecution or defense of any action or proceeding related
to the subject matter of this Agreement; and then to the Secured Obligations in
the manner authorized by the Loan Agreement.
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15. Redemption;
Marshaling. Pledgor hereby waives and releases to the fullest
extent permitted by Applicable Law any right of equity of redemption with
respect to the Pledged Collateral before or after a sale conducted pursuant to
Section 14 hereof. Pledgor agrees that Agent shall not be required to
marshal any present or future security (including this Agreement and the Pledged
Collateral pledged hereunder) for, or guaranties of, the Secured Obligations or
any of them, or to resort to such security or guaranties in any particular
order; and all of Agent's rights hereunder and in respect of such security and
guaranties shall be cumulative and in addition to all other rights, however
existing or arising. To the fullest extent that it lawfully may,
Pledgor hereby agrees that it will not invoke any law relating to the marshaling
of collateral which might cause delay in or impede the enforcement of Agent's
rights under this Agreement or under any other instrument evidencing any of the
Secured Obligations or under which any of the Secured Obligations is outstanding
or by which any of the Secured Obligations is secured or guaranteed, and to the
fullest extent that it lawfully may, Pledgor hereby irrevocably waives the
benefits of all such laws.
16. Term. This
Agreement shall become effective only when accepted by Agent and, when so
accepted, shall constitute a continuing agreement and shall remain in full force
and effect until the Loan Agreement and the Parent Guaranty are terminated and
all of the Secured Obligations have been fully and finally paid, satisfied and
discharged, at which time this Agreement shall terminate and Agent shall deliver
to Pledgor, at Pledgor's expense, (i) such of the Pledged Collateral as shall
not have been sold or otherwise applied pursuant to this Agreement and (ii) such
termination statements and other release documents as may be requested by
Pledgor to evidence the termination of Agent's security interest in the Pledged
Collateral. Notwithstanding the foregoing, in no event shall any
termination of this Agreement terminate any indemnity set forth in this
Agreement or any of the other Loan Documents, all of which indemnities shall
survive any termination of this Agreement, the Parent Guaranty or any of the
other Loan Documents in accordance with their respective terms.
17. Rules and
Construction. The singular shall include the plural and vice
versa, and any gender shall include any other gender as the text shall
indicate. All references to "including" shall mean "including,
without limitation." Whenever in this Agreement the words "Equity
Interest" or "Equity Interests" or other similar words or phrases are
used in connection with a Person referring to equity ownership interests in such
Person, such word or phrase shall be deemed to include a reference to capital
stock, limited liability company membership interests, and general or limited
partnership interests in a limited partnership or limited liability partnership,
each reference to a "corporation" shall also be deemed to include a reference to
a limited liability company, limited partnership or limited liability
partnership and vice versa, each reference to "shareholders" of a Person shall
also be deemed to include a reference to members or partners and vice versa and
each reference to "certificate of incorporation" or "articles of incorporation"
or "bylaws" shall also be deemed to include a reference to "certificate of
formation" or "certificate of limited partnership" and "limited liability
company operating agreement" or "limited partnership agreement" or other
constituent documents of a limited liability company, limited partnership or
limited liability partnership and vice versa.
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18. Successors
and Assigns. This Agreement shall be binding upon Pledgor and
its successors and assigns, and shall inure to the benefit of Agent and its
successors and assigns.
19. Construction
and Applicable Law. 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 any 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. This Agreement shall be governed by and the rights and
liabilities of the parties hereto determined and construed in accordance with
the internal laws of the State of Rhode Island without regard to its conflicts
of law provisions. This Agreement is intended to take effect as a
document executed and delivered under seal
20. Cooperation
and Further Assurances. Pledgor agrees that it will cooperate
with Agent and will, upon Agent's request, execute and deliver, or cause to be
executed and delivered, all such other powers, instruments, financing
statements, certificates, legal opinions and other documents, and will take all
such other action as Agent requests from time to time, in order to carry out the
provisions and purposes hereof, including delivering to Agent, if requested by
Agent, irrevocable proxies with respect to the Equity Interests in form
satisfactory to Agent. Until receipt thereof, this Agreement
shall constitute Pledgor's proxy to Agent or its nominee to vote all shares of
the Equity Interests then registered in Pledgor's name (subject to Pledgor's
voting rights under Section 3 hereof).
21. Agent's
Exoneration. Under no circumstances shall Agent be deemed to
assume any responsibility for or obligation or duty with respect to any part or
all of the Pledged Collateral of any nature or kind, other than the physical
custody thereof, or any matter or proceedings arising out of or relating
thereto. Agent shall not be required to take any action of any kind
to collect, preserve or protect its or Pledgor's rights in the Pledged
Collateral or against other parties thereto. Agent's prior recourse
to any part or all of the Pledged Collateral shall not constitute a condition of
any demand, suit or proceeding for payment or collection of the Secured
Obligations.
22. Notices. All
notices, requests and demand to or upon either party hereto shall be given in
the manner and become effective as stipulated in the Loan
Agreement.
23. Pledgor's
Obligations Not Affected. The obligations of Pledgor hereunder
shall remain in full force and effect without regard to, and shall not be
impaired by (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of Pledgor; (b) any exercise
or nonexercise, or any waiver, by Agent of any right, remedy, power or privilege
under or in respect of any of the Secured Obligations or any security thereof
(including this Agreement); (c) any amendment to or modification of the Loan
Agreement, the Parent Guaranty, the other Loan Documents or any of the Secured
Obligations; (d) any amendment to or modification of any instrument (other than
this Agreement) securing any of the Secured Obligations; or (e) the taking of
additional security for, or any guaranty of, any of the Secured Obligations or
the release or discharge or termination of any security or guaranty for any of
the Secured Obligations, regardless of whether or not Pledgor shall have notice
or knowledge of any of the foregoing.
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24. No
Waiver, Etc. No act,
failure or delay by Agent shall constitute a waiver of any of its rights and
remedies hereunder or otherwise. No single or partial waiver by Agent
of any Default or Event of Default or right or remedy that Agent might have
shall operate as a waiver of any other Default, Event of Default, right or
remedy or of the same Default, Event of Default, right or remedy on a future
occasion. Pledgor hereby waives presentment, notice of dishonor and
protest of all instruments included in or evidencing any of the Secured
Obligations or the Pledged Collateral, and any and all other notices and demands
whatsoever (except as expressly provided herein).
25. Section
Headings. The section headings herein are for convenience of
reference only, and shall not affect in any way the interpretation of any of the
provisions hereof.
26. Agent
Appointed Attorney-In-Fact. Upon the occurrence and
continuation of an Event of Default, Pledgor hereby constitutes and appoints
Agent, with full power of substitution, Pledgor's attorney-in-fact for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that Agent reasonably deems necessary or advisable
to accomplish the purposes hereof, which appointment is coupled with an interest
and is irrevocable. Without limiting the generality of the foregoing,
Agent shall have the power to arrange for the transfer, upon the occurrence
and continuation of an Event of Default, of any of the Pledged Collateral on the
books of any or all of Companies to the name of Agent or Agent's
nominee. Pledgor agrees to indemnify and save Agent harmless from and
against any liability or damage that Agent might suffer or incur, in the
exercise or performance of any of Agent's powers and duties specifically set
forth herein other than that caused by gross negligence or willful misconduct of
Agent.
27. Use of
Loan Proceeds. Pledgor hereby represents and warrants to Agent
that none of the loan proceeds heretofore and hereafter received by it under the
Loan Agreement are for the purpose of purchasing any "margin security" as that
term is defined in either Regulation U promulgated by the Board of Governors of
the Federal Reserve System, or refinancing any indebtedness originally incurred
to purchase any such "margin security."
28. Waiver of
Subrogation and Other Claims. Pledgor recognizes that Agent,
in exercising its rights and remedies with respect to the Pledged Collateral,
may likely be unable to find one or more purchasers thereof if, after the sale
of the Pledged Collateral, a Company were, because of any claim based on
subrogation or any other theory, liable to Pledgor on account of the sale by
Agent of the Pledged Collateral in full or partial satisfaction of the Secured
Obligations or liable to Pledgor on account of any indebtedness owing to Pledgor
that is subordinated to any or all of the Secured
Obligations. Pledgor hereby agrees, therefore, that if Agent sells
any of the Pledged Collateral in full or partial satisfaction of the Secured
Obligations, Pledgor shall in such case have no right or claim against any
Company on account of any such subordinated indebtedness or on the theory that
Pledgor has become subrogated to any claim or right of Agent against such
Company or on any basis whatsoever, and Pledgor hereby expressly waives and
relinquishes all such rights and claims against Companies.
9
29. Execution
in Counterparts. This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed and delivered shall be deemed to be an original and
all of which counterparts taken together shall constitute but one and the same
instrument. In proving this Agreement in any judicial proceeding, it
shall not be necessary to produce or account for more than one such counterpart
signed by the party against whom such enforcement is sought. Any
manually-executed signature page delivered by a party by facsimile or other
electronic transmission shall be deemed to be an original signature page
hereto.
30. WAIVERS. PLEDGOR
HEREBY WAIVES: NOTICE OF AGENT'S ACCEPTANCE OF THIS AGREEMENT; NOTICE OF
EXTENSIONS OF CREDIT, LOANS, ADVANCES OR OTHER FINANCIAL ASSISTANCE BY AGENT AND
LENDERS TO BORROWER; TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL
BY JURY (WHICH AGENT AND LENDERS ALSO WAIVE) IN ANY ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM CONCERNING THIS AGREEMENT OR ANY OF THE PLEDGED COLLATERAL;
PRESENTMENT AND DEMAND FOR PAYMENT OF ANY OF THE SECURED OBLIGATIONS; PROTEST
AND NOTICE OF DISHONOR OR DEFAULT WITH RESPECT TO ANY OF THE SECURED
OBLIGATIONS; AND ALL OTHER NOTICES TO WHICH PLEDGOR MIGHT OTHERWISE BE ENTITLED
EXCEPT AS HEREIN OTHERWISE EXPRESSLY PROVIDED.
[Remainder
of page intentionally left blank;
signatures
begin on following page.]
10
IN
WITNESS WHEREOF, Pledgor has signed, sealed and delivered this Agreement on the
day and year first above written.
| PLEDGOR: | |||
| ANCHOR FUNDING SERVICES, INC. | |||
|
|
By:
|
/s/ | |
| Xxxx Xxxxxxxxx | |||
| President | |||
| Accepted in Atlanta, Georgia: | |||
| AGENT: | |||
|
TEXTRON
FINANCIAL CORPORATION,
as Agent
|
|||
|
|
By:
|
/s/ | |
11
ANNEX A
|
Issuer
|
Type and Class of
Equity Interests
|
Number of Pledged
Equity Interests
|
Percentage of Outstanding Equity
Interests
|
|
Anchor
Funding Services, LLC
|
membership
interests
|
N/A
|
100%
|
12
