SENIOR MANAGEMENT AGREEMENT
THIS AGREEMENT is made as of November 20, 1996 between U. S.
Aggregates, Inc., a Delaware corporation (the "Company"), and Xxxxxxx X. Xxxxx
("Executive").
The Company and Executive desire to enter into an agreement pursuant
to which Executive shall purchase 810.50 shares of the Company's common stock,
par value $.01 per share (the "Common Stock"). All shares of Common Stock
received hereunder by Executive and all shares of Common Stock hereafter
acquired by Executive are referred to herein as "Executive Stock." Certain
definitions are set forth in Section 5 of this Agreement.
The parties hereto agree as follows:
1. PURCHASE AND SALE OF EXECUTIVE STOCK.
(a) Upon execution of this Agreement (the "Closing"), the Company
will sell to Executive and Executive will purchase 810.50 shares of Common Stock
at a price of $10 per share. The Company will deliver to Executive the
certificate representing such Common Stock, and Executive will deliver to the
Company a check or wire transfer of funds in an amount of $8.11 and a promissory
note in the form of EXHIBIT A attached hereto in an aggregate principal amount
of$8,096.89 (the "Executive Note"). Executive's obligations under the Executive
Note will be secured by a pledge of all of the shares of Executive Stock to the
Company and in connection therewith Executive shall enter into a pledge
agreement in the form of EXHIBIT B attached hereto (the "Pledge Agreement").
(b) In connection with the purchase and sale of the Executive Stock
hereunder, Executive represents and warrants to the Company that:
(i) The Executive Stock to be acquired by Executive pursuant to this
Agreement will be acquired for Executive's own account and not with a view
to, or intention of, distribution thereof in violation of the Securities
Act, or any applicable state securities laws, and the Executive Stock will
not be disposed of in contravention of the Securities Act or any applicable
state securities laws;
(ii) Executive is an executive officer of the Company, is
sophisticated in financial matters and is able to evaluate the risks and
benefits of the investment in the Executive Stock;
(iii) Executive is able to bear the economic risk of his investment in
the Executive Stock for an indefinite period of time because the Executive
Stock has not been registered under the Securities Act and, therefore,
cannot be sold unless
subsequently registered under the Securities Act or an exemption from
such registration is available;
(iv) Executive has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of Executive
Stock and has had full access to such other information concerning the
Company as he has requested; and
(v) This Agreement constitutes the legal, valid and binding
obligation of Executive, enforceable in accordance with its terms, and the
execution, delivery and performance of this Agreement by Executive does not
and will not conflict with, violate or cause a breach of any agreement,
contract or instrument to which Executive is a party or any judgment, order
or decree to which Executive is subject.
(c) As an inducement to the Company to issue the Executive Stock to
Executive, as a condition thereto, Executive acknowledges and agrees that:
(i) neither the issuance of the Executive Stock to Executive nor any
provision contained herein shall affect any of the rights of the Company
set forth in the Employment Agreement dated as of January 24, 1994 between
the Executive and the Company (the "Employment Agreement"); and
(ii) the Company shall have no duty or obligation to disclose to
Executive, and Executive shall have no right to be advised of, any material
information regarding the Company and its Subsidiaries at any time prior
to, upon or in connection with the repurchase of Executive Stock upon the
termination of Executive's employment with the Company and its Subsidiaries
or as otherwise provided hereunder.
2. REPURCHASE OPTION.
(a) In the event Executive ceases to be employed by the Company and
its Subsidiaries for any reason (the "Termination"), all Executive Stock
(whether held by Executive or one or more of Executive's transferees) will be
subject to repurchase by the Company and the Investor pursuant to the terms and
conditions set forth in this Section 2 (the "Repurchase Option"). The purchase
price for each share of the Executive Stock will be the higher of the
Executive's Original Cost and the Fair Market Value for such share.
(b) The Board of Directors of the Company (the "Board") may elect to
purchase all, but not less than all, of the Executive Stock by delivering
written notice (the "Repurchase Notice") to the holder or holders of such
Executive Stock within one year after the Termination (it being understood that
an election to purchase Executive Stock hereunder shall not be an election to
purchase the stock acquired pursuant to the senior management agreements with
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other executives of the Company). The Repurchase Notice will set forth the
number of shares to be acquired from each holder, the aggregate consideration to
be paid for such shares and the time and place for the closing of the
transaction.
(c) If for any reason the Company does not elect to purchase all of
the Executive Stock pursuant to the Repurchase Option, the Investor shall be
entitled to exercise the Repurchase Option for the shares of Executive Stock the
Company has not elected to purchase (the "Available Shares"). As soon as
practicable after the Company has determined that there will be Available
Shares, but in any event within ten months after the Termination, the Company
shall give written notice (the "Option Notice") to the Investor setting forth
the number of Available Shares and the purchase price for the Available Shares.
The Investor may elect to purchase all, but not less than all, of the Available
Shares by giving written notice to the Company within one month after the Option
Notice has been given by the Company. As soon as practicable, and in any event
within ten days after the expiration of the one-month period set forth above,
the Company shall notify each holder of Executive Stock as to the number of
shares being purchased from such holder by the Investor (the "Supplemental
Repurchase Notice"). At the time the Company delivers the Supplemental
Repurchase Notice to the holder(s) of Executive Stock, the Company shall also
deliver written notice to the Investor setting forth the number of shares the
Investor is entitled to purchase, the aggregate purchase price and the time and
place of the closing of the transaction.
(d) In the event that (i) the Executive's employment is terminated by
the Company without Cause, (ii) neither the Company nor the Investor has elected
to purchase all of the Executive Stock hereunder and (iii) at the time of such
Termination, the Company is meeting all budget projections set forth by the
Board for that fiscal year, the Executive may require the Company to purchase
all, but not less than all, of the Executive Stock by delivering written notice
(the "Put Notice") to the Company within one year after such Termination. The
Put Notice will set forth the number of shares to be acquired from each holder
and the time and place for the closing of the transaction.
(e) The closing of the purchase of the Executive Stock pursuant to
the Repurchase Option or the Put Notice shall take place on the date designated
by the Company in the case of either the Repurchase Notice or the Supplemental
Repurchase Notice or by the Executive in the case of the Put Notice, which date
shall not be more than one month nor less than five days after the delivery of
the later of any such notice to be delivered. The Company and/or the Investor
will pay for the Executive Stock to be purchased pursuant to the Repurchase
Option by delivery of a check or wire transfer of funds in the aggregate amount
of the purchase price for such shares; provided, however, that the Company may
elect to pay for the Executive Stock to be purchased pursuant to the Put Notice
by delivery of a promissory note from the Company
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having a term no longer than five years, payable in sixty equal installments,
a market rate of interest and other typical market terms. In addition, the
Company may pay the purchase price for such shares by offsetting amounts
outstanding under any bona fide debts owed by Executive to the Company
including, without limitation, debts owed under the Executive Note. The
Company and the Investor will be entitled to receive customary
representations and warranties from the sellers regarding such sale and to
require all sellers' signatures be guaranteed.
(f) The right of the Company and the Investor to repurchase Executive
Stock pursuant to this Section 2 and the obligation of the Company to repurchase
the Executive Stock pursuant to paragraph (e) above shall terminate upon the
first to occur of the Sale of the Company or a Qualified Public Offering.
(g) Notwithstanding anything to the contrary contained in this
Agreement, all repurchases of Executive Stock by the Company shall be subject to
applicable restrictions contained in the Delaware General Corporation Law and in
the Company's and its Subsidiaries' debt and equity financing agreements. If
any such restrictions prohibit the repurchase of Executive Stock hereunder which
the Company is otherwise entitled or required to make, the Company will make
such repurchases as soon as it is permitted to do so under such restrictions.
3. RESTRICTIONS ON TRANSFER.
(a) LEGEND. The certificates representing the Executive Stock will
bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
AS OF NOVEMBER 20, 1996, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND
CERTAIN OTHER AGREEMENTS SET FORTH IN A SENIOR MANAGEMENT AGREEMENT
BETWEEN U. S. AGGREGATES, INC.(THE "COMPANY") AND XXXXXXX X. XXXXX
DATED AS OF NOVEMBER 20, 1996 AND THE STOCKHOLDER AGREEMENT DATED AS
OF JANUARY 24, 1994 AMONG THE COMPANY AND CERTAIN OF ITS STOCKHOLDERS.
A COPY OF SUCH AGREEMENTS MAY BE OBTAINED BY THE HOLDER HEREOF AT THE
COMPANY'S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
(b) OPINION OF COUNSEL. No holder of Executive Stock may sell,
transfer or dispose of any Executive Stock (except pursuant to an effective
registration statement under the Securities Act) without first delivering to the
Company an opinion of counsel (reasonably acceptable in form and substance to
the Company) that neither registration nor qualification under the
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Securities Act and applicable state securities laws is required in connection
with such transfer.
4. DEFINITIONS.
"CAUSE" means (i) the commission of a felony or a crime involving
moral turpitude or the commission of any other act involving dishonesty,
disloyalty or fraud with respect to the Company or any of its Subsidiaries, (ii)
conduct tending to bring the Company or any of its Subsidiaries into public
disgrace or disrepute, (iii) failure to perform duties as reasonably directed by
the Board, (iv) gross negligence or willful misconduct with respect to the
Company or any of its Subsidiaries or (v) any other material breach of this
Agreement or any other agreement to which the Executive and the Company are
parties which is not cured within 10 days after written notice thereof to
Executive.
"DISABILITY" means Executive's inability, because of injury, illness
or other incapacity to perform the services to the Company contemplated by the
Employment Agreement for a continuous period of 90 days or for 120 days out of a
continuous period of 360 days. Such Disability shall be deemed to have occurred
on the 90th consecutive day or the 120th day within the specified period, as
applicable.
"EXECUTIVE STOCK" will continue to be Executive Stock in the hands of
any holder other than Executive (except for the Company and the Investor and
except for transferees in a Public Sale), and except as otherwise provided
herein, each such other holder of Executive Stock will succeed to all rights and
obligations attributable to Executive as a holder of Executive Stock hereunder.
Executive Stock will also include shares of the Company's capital stock issued
with respect to Executive Stock by way of a stock split, stock dividend or other
recapitalization. Notwithstanding the foregoing, all Unvested Shares shall
remain Executive Stock after any Transfer thereof.
"FAIR MARKET VALUE" of each share of Executive Stock means the average
of the closing prices of the sales of the Company's Common Stock on all
securities exchanges on which the Common Stock may at the time be listed, or, if
there have been no sales on any such exchange on any day, the average of the
highest bid and lowest asked prices on all such exchanges at the end of such
day, or, if on any day the Common Stock is not so listed, the average of the
representative bid and asked prices quoted in the NASDAQ System as of 4:00 P.M.,
New York time, or, if on any day the Common Stock is not quoted in the NASDAQ
System, the average of the highest bid and lowest asked prices on such day in
the domestic over-the-counter market as reported by the National Quotation
Bureau Incorporated, or any similar successor organization, in each such case
averaged over a period of 21 days consisting of the day as of which the Fair
Market Value is being determined and the 20 consecutive business days prior to
such day. If at any time the Common Stock is not listed on any securities
exchange or quoted in
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the NASDAQ System or the over-the-counter market, the Fair Market Value will
be the fair value of the Common Stock determined jointly in good faith by the
Company and Executive; provided that if such parties are unable to reach
agreement within 15 days following the Termination, such Fair Market Value
shall be determined by an independent appraiser jointly selected by the
Company and Executive. In the event that such parties are unable to reach
agreement with respect to such independent appraiser within 5 days following
the conclusion of the 15-day period described above, each of the Company and
Executive shall promptly (and in any event within 5 days therefrom) select an
independent appraiser, and the two independent appraisers so selected shall,
as promptly as possible (and in any event within 10 days therefrom), jointly
select a third independent appraiser. The independent appraiser hereunder
shall determine the Fair Market Value of such Executive Stock within 60 days
following the Termination. Any independent appraiser determining Fair Market
Value of the Executive Stock hereunder shall use one or more valuation
methods that such independent appraiser, in its best professional judgment,
determines to be most appropriate under the circumstances, provided that no
premium or discount shall be applied regarding any presence or absence of
control of the Company. The determination of such third appraiser shall be
final and binding on the Company and Executive. The fees and expenses of all
appraiser(s) shall be borne by the Company and Executive in relation to the
amount by which the fair market value determined by the Company and
Executive, respectively, pursuant to the first clause of the second sentence
of this definition differs from the fair market value determined by the final
appraiser.
"INVESTOR" means Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV Limited
Partnership.
"ORIGINAL COST" of each share of Common Stock issued hereunder will be
equal to $10, each share of Common Stock issued pursuant to the Acquisition
Agreement will be equal to $10 (as proportionately adjusted for all subsequent
stock splits, stock dividends and other recapitalizations).
"PUBLIC SALE" means any sale pursuant to a registered public offering
under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"QUALIFIED PUBLIC OFFERING" means the sale in an underwritten public
offering registered under the Securities Act of shares of the Company's Common
Stock having an aggregate offering value of at least $30 million.
"SALE OF THE COMPANY" means any transaction or series of related
transaction pursuant to which any person or entity acquires (i) capital stock of
the Company possessing the voting power to elect a majority of the Company's
board of directors (whether by merger, consolidation, reorganization,
combination, sale or
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transfer of the Company's capital stock or otherwise) or (ii) all or
substantially all of the Company's assets determined on a consolidated basis.
"SECURITIES ACT" means the Securities Act of 1933, as amended from
time to time.
"SUBSIDIARY" means any corporation of which the Company owns
securities having a majority of the ordinary voting power in electing the board
of directors directly or through one or more subsidiaries.
5. NOTICES. Any notice provided for in this Agreement must be in
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to the recipient at the address below
indicated:
IF TO THE COMPANY:
U. S. Aggregates, Inc.
0000 Xxxxx Xxxxxxx Xxxxxx
Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: President
WITH A COPY TO:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Xxxx X. Xxxxxxxxxx
IF TO THE EXECUTIVE:
Xxxxxxx X. Xxxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxxx, XX 00000
IF TO THE INVESTOR:
Golder, Thoma, Xxxxxxx, Xxxxxx Fund IV
Limited Partnership
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxx
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WITH A COPY TO:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Xxxx X. Xxxxxxxxxx
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6. GENERAL PROVISIONS.
(a) EXPENSES. The Company agrees to pay, and hold the Executive
harmless against liability for the payment of the fees and expenses of its
counsel arising in connection with the negotiation and execution of this
Agreement and other related senior management agreements and consultant stock
agreements and the consummation of the transactions contemplated by this and
those agreements; provided that the aggregate of such amount attributable to all
such transactions shall not exceed $10,000.
(b) TRANSFERS IN VIOLATION OF AGREEMENT. Any Transfer or attempted
Transfer of any Executive Stock in violation of any provision of this Agreement
shall be void, and the Company shall not record such Transfer on its books or
treat any purported transferee of such Executive Stock as the owner of such
stock for any purpose.
(c) SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(d) COMPLETE AGREEMENT. This Agreement, those documents expressly
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof in any way.
(e) COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original
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and all of which taken together constitute one and the same agreement.
(f) SUCCESSORS AND ASSIGNS. Except as otherwise provided herein,
this Agreement shall bind and inure to the benefit of and be enforceable by
Executive, the Company, the Investor and their respective successors and assigns
(including subsequent holders of Executive Stock); provided that the rights and
obligations of Executive under this Agreement shall not be assignable except in
connection with a permitted transfer of Executive Stock hereunder.
(g) CHOICE OF LAW. The corporate law of the State of Illinois will
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Illinois, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.
(h) REMEDIES. Each of the parties to this Agreement (including the
Investor) will be entitled to enforce its rights under this Agreement
specifically, to recover damages and costs (including attorneys' fees) caused by
any breach of any provision of this Agreement and to exercise all other rights
existing in its favor. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or deposit)
for specific performance and/or other injunctive relief in order to enforce or
prevent any violations of the provisions of this Agreement.
(i) AMENDMENT AND WAIVER. The provisions of this Agreement may be
amended and waived only with the prior written consent of the Company, Executive
and the Investor.
(j) BUSINESS DAYS. If any time period for giving notice or taking
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
(k) TERMINATION. This Agreement shall survive the termination of
Executive's employment with the Company and shall remain in full force and
effect after such termination.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
U. S. Aggregates, Inc.
By /s/ Xxxxxxx Xxxxx
---------------------------
Its
--------------------------
/s/ Xxxxxxx X. Xxxxx
-----------------------------
Xxxxxxx X. Xxxxx
Agreed and Accepted:
GOLDER, THOMA, XXXXXXX, XXXXXX FUND IV
LIMITED PARTNERSHIP
By Golder, Thoma, Cressey, Rauner, Inc.
Its General Partner
By /s/ Xxxxx X. Xxxxxxx
--------------------------
Its Principal
-------------------------
[PROVISION FOR COMMUNITY PROPERTY JURISDICTIONS]
CONSENT
The undersigned spouse of Executive hereby acknowledges that I have
read the foregoing Senior Management Agreement and that I understand its
contents. I am aware that the Agreement provides for the repurchase of my
spouse's shares of Common Stock under certain circumstances and imposes other
restrictions on the transfer of such Common Stock. I agree that my spouse's
interest in the Common Stock is subject to this Agreement and any interest I may
have in such Common Stock shall be irrevocably bound by this Agreement and
further that my community property interest, if any, shall be similarly bound by
this Agreement.
/s/ Xxxxx X. Xxxxx
------------------------------
[SPOUSE]
/s/ Xxxxxx Do Xxxxx
------------------------------
Witness
EXHIBIT A
PROMISSORY NOTE
$8,096.89 November 20, 1996
For value received, Xxxxxxx X. Xxxxx ("Executive") promises to pay on
November 20, 2001 to the order of U. S. Aggregates, Inc., a Delaware corporation
(the "Company"), at its offices in San Mateo, California, or such other place as
designated in writing by the holder hereof, the aggregate principal sum of
$8,096.89. This Note was issued pursuant to and is subject to the terms of the
Senior Management Agreement (the "Agreement"), dated as of November 20, 1996
between the Company and Executive.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable; provided, however, interest shall cease to
accrue upon the date on which a Repurchase Notice is delivered to Executive
pursuant to Section 2(c) of the Agreement.
The amounts due under this Note are secured by a pledge of 810.50
shares of the Company's Common Stock. The payment of the principal amount of
this Note is subject to certain offset rights under the Senior Management
Agreement.
In the event Executive fails to pay any amounts due hereunder when
due, Executive shall pay to the holder hereof, in addition to such amounts due,
all costs of collection, including reasonable attorneys fees.
Executive, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Executive hereunder.
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of Illinois.
/s/ Xxxxxxx X. Xxxxx
-----------------------------
Xxxxxxx X. Xxxxx
EXECUTIVE STOCK PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT is made as of November 20, 1996, between Xxxxxxx
X. Xxxxx ("Pledgor"), and U. S. Aggregates, Inc., a Delaware corporation (the
"Company").
The Company and Pledgor are parties to an Senior Management Agreement,
dated November 20, 1996 pursuant to which Pledgor purchased 810.50 shares of the
Company's Common Stock, $.01 par value (the "Pledged Shares"), for an aggregate
purchase price of $8,105.00. The Company has allowed Pledgor to purchase the
Pledged Shares by delivery to the Company of a promissory note (the "Note") in
the aggregate principal amount of $8,096.89. This Pledge Agreement provides the
terms and conditions upon which the Note is secured by a pledge to the Company
of the Pledged Shares.
NOW, THEREFORE, in consideration of the premises contained herein and
other good and valuable consideration the receipt and sufficiency of which are
hereby acknowledged, and in order to induce the Company to accept the Note as
payment for the Pledged Shares, Pledgor and the Company hereby agree as follows:
1. PLEDGE. Pledgor hereby pledges to the Company, and grants to the
Company a security interest in, the Pledged Shares as security for the prompt
and complete payment when due of the unpaid principal of and interest on the
Note.
2. DELIVERY OF PLEDGED SHARES. Upon the execution of this Pledge
Agreement, Pledgor shall deliver to the Company the certificate(s) representing
the Pledged Shares, together with duly executed forms of assignment sufficient
to transfer title thereto to the Company.
3. VOTING RIGHTS; CASH DIVIDENDS. Notwithstanding anything to the
contrary contained herein, during the term of this Pledge Agreement until such
time as there exists a default in the payment of principal or interest on the
Note or any other default under the Note, Pledgor shall be entitled to all
voting rights with respect to the Pledged Shares and shall be entitled to
receive all cash dividends paid in respect of the Pledged Shares. Upon the
occurrence of and during the continuance of any such default, the Company shall
retain all such cash dividends payable on the Pledged Shares as additional
security hereunder.
4. STOCK DIVIDENDS; DISTRIBUTIONS, ETC. If, while this Pledge
Agreement is in effect, Pledgor becomes entitled to receive or receives any
securities or other property in addition to, in substitution of, or in exchange
for any of the Pledged Shares (whether as a distribution in connection with any
recapitalization,
reorganization or reclassification, a stock dividend or otherwise), Pledgor
shall accept such securities or other property on behalf of and for the
benefit of the Company as additional security for Pledgor's obligations under
the Note and shall promptly deliver such additional security to the Company
together with duly executed forms of assignment, and such additional security
shall be deemed to be part of the Pledged Shares hereunder.
5. DEFAULT. If Pledgor defaults in the payment of the principal or
interest under the Note as it becomes due (whether upon demand, acceleration or
otherwise) or any other event of default under the Note occurs (including the
bankruptcy or insolvency of Pledgor), the Company may exercise any and all the
rights, powers and remedies of any owner of the Pledged Shares (including the
right to vote the shares and receive dividends and distributions with respect to
such shares) and shall have and may exercise without demand any and all the
rights and remedies granted to a secured party upon default under the Uniform
Commercial Code of Delaware or otherwise available to the Company under
applicable law. Without limiting the foregoing, the Company is authorized to
sell, assign and deliver at its discretion, from time to time, all or any part
of the Pledged Shares at any private sale or public auction, on not less than
ten days written notice to Pledgor, at such price or prices and upon such terms
as the Company may deem advisable. Pledgor shall have no right to redeem the
Pledged Shares after any such sale or assignment. At any such sale or auction,
the Company may bid for, and become the purchaser of, the whole or any part of
the Pledged Shares offered for sale. In case of any such sale, after deducting
the costs, attorneys' fees and other expenses of sale and delivery, the
remaining proceeds of such sale shall be applied to the principal of and accrued
interest on the Note; provided, however, that after payment in full of the
indebtedness evidenced by the Note, the balance of the proceeds of sale then
remaining shall be paid to Pledgor and Pledgor shall be entitled to the return
of any of the Pledged Shares remaining in the hands of the Company. Pledgor
shall be liable for any deficiency if the remaining proceeds are insufficient to
pay the indebtedness under the Note in full, including the fees of any attorneys
employed by the Company to collect such deficiency.
6. COSTS AND ATTORNEYS' FEES. All costs and expenses, including
reasonable attorneys' fees, incurred in exercising any right, power or remedy
conferred by this Pledge Agreement or in the enforcement thereof, shall become
part of the indebtedness secured hereunder and shall be paid by Pledgor or
repaid from the proceeds of the sale of the Pledged Shares hereunder.
7. PAYMENT OF INDEBTEDNESS AND RELEASE OF PLEDGED SHARES. Upon
payment in full of the indebtedness evidenced by the Note, the Company shall
surrender the Pledged Shares to Pledgor together with all forms of assignment.
8. FURTHER ASSURANCES. Pledgor agrees that at any time and from
time to time upon the written request of the Company, Pledgor will execute and
deliver such further documents and do such further acts and things as the
Company may reasonably request in order to effect the purposes of this Pledge
Agreement.
9. SEVERABILITY. Any provision of this Pledge Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10. NO WAIVER; CUMULATIVE REMEDIES. The Company shall not by any
act, delay, omission or otherwise be deemed to have waived any of its rights or
remedies hereunder, and no waiver shall be valid unless in writing, signed by
the Company, and then only to the extent therein set forth. A waiver by the
Company of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Company would otherwise have
on any future occasion. No failure to exercise nor any delay in exercising on
the part of the Company, any right, power or privilege hereunder shall preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The rights and remedies herein provided are cumulative and may be
exercised singly or concurrently, and are not exclusive of any rights or
remedies provided by law.
11. WAIVERS, AMENDMENTS; APPLICABLE LAW. None of the terms or
provisions of this Pledge Agreement may be waived, altered, modified or amended
except by an instrument in writing, duly executed by the parties hereto. This
Agreement and all obligations of the Pledgor hereunder shall together with the
rights and remedies of the Company hereunder, inure to the benefit of the
Company and its successors and assigns. This Pledge Agreement shall be governed
by, and be construed and interpreted in accordance with, the laws of the State
of Illinois.
**************
IN WITNESS WHEREOF, this Pledge Agreement has been executed as of the
date first above written.
/s/ Xxxxxxx Xxxxx
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Xxxxxxx X. Xxxxx
U. S. Aggregates, Inc.
By /s/ Xxxxxxx Xxxxx
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Its
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