Exhibit 10.2
COLLATERAL PLEDGE
AGREEMENT
THIS COLLATERAL PLEDGE AGREEMENT
(this “ Agreement ”), executed and delivered as
of August 5, 2009, by RIDGE CLEARING & OUTSOURCING
SOLUTIONS, INC. , a New York corporation (“ Debtor
”), in favor of U.S. BANK NATIONAL ASSOCIATION , a
national banking association (“ Secured Party
”), pursuant to the terms of the Loan Agreement (Committed
Customer Facility A) dated as of August 5, 2009, by and among
Debtor, as Borrower, Broadridge Financial Solutions, Inc., as
Guarantor, and Secured Party, as Lender, as the same may from time
to time be amended, modified, extended, renewed or restated (the
“ Loan Agreement ”; all capitalized terms used
and not otherwise defined in this Agreement shall have the
respective meanings ascribed to them in the Loan Agreement); and
has reference to the following facts and circumstances:
A. As a condition precedent to
Secured Party entering into the Loan Agreement, Secured Party has
required that Debtor execute and deliver this Agreement to Secured
Party.
B. In order to induce Secured Party
to enter into the Loan Agreement, Debtor has agreed to execute and
deliver this Agreement to Secured Party.
NOW, THEREFORE, in consideration of
the foregoing, Debtor agrees with Secured Party as
follows:
SECTION 1. DEFINITIONS
.
Except as otherwise defined in this
Agreement and the Loan Agreement, all words, terms and/or phrases
used in this Agreement shall be defined by the applicable
definition therefor (if any) in the Uniform Commercial Code as
adopted by the State of New York, as in effect from time to time
(the “ New York Uniform Commercial Code ”) (with
terms used in Article 9 controlling over terms used in another
Article).
SECTION 2. COLLATERAL - GENERAL
TERMS .
2.01 To secure the prompt, full and
faithful performance to Secured Party of Borrower’s
Obligations, Debtor grants to Secured Party a security interest in
and to, and pledges and assigns to Secured Party, all of the
following, now owned and hereafter acquired by Debtor and/or
Debtor’s customers (referred to individually and/or
collectively as the “ Collateral ”): all right,
title, share and interest in, to and under (a) the securities
account listed on Schedule I attached hereto and incorporated by
reference (the “ Collateral Account ”);
(b) those shares of stock, securities, security entitlements,
and/or financial assets, together with any and all distributions,
whether in cash or in kind, upon or in connection therewith,
whether such distributions or payments are dividends, are in
partial or complete liquidation, or are the result of
reclassification, readjustment or other changes in the capital
structure of the Person issuing the same, or otherwise, and any and
all subscriptions, warrants, options and other rights issued upon
and/or in connection therewith (collectively, the “
Securities ”), in each case, as deposited or held in
or transferred or credited to or carried in the Collateral Account
from time to time; (c) any and all monies, reserves, deposits,
certificates of deposit and deposit accounts and interest or
dividends, securities, investment property, cash, cash equivalents
and other property now or at any time or times hereafter in the
possession or under the control of Secured Party, its parent,
Subsidiaries or Affiliates or its bailee; (c) any and all
accessions to any of the Collateral and all substitutions,
renewals, improvements and replacements of and additions thereto;
and (d) all proceeds of the foregoing (whether in the form of
cash, proceeds of insurance policies, instruments, documents,
general intangibles, contract rights, accounts, chattel paper, or
otherwise). Notwithstanding anything to the contrary,
“Collateral” shall not include any (i) deposit
accounts or securities accounts holding solely assets that have
been segregated for the exclusive benefit of Debtor’s
customers or such segregated assets, or (ii) trust or other
fiduciary deposit accounts or securities accounts and the assets
therein.
2.02 Debtor shall execute and/or
deliver to Secured Party upon request, at any time and from time to
time hereafter, all agreements, instruments, documents and other
written matter (the “ Supplemental Documentation
”) that Secured Party reasonably may request, in form and
substance acceptable to Secured Party, to perfect and maintain
Secured Party’s perfected security interest, lien and/or
encumbrance in and/or pledge and assignment of the Collateral and
to consummate the transactions contemplated in or by this
Agreement.
2.03 Debtor warrants and represents
to and covenants with Secured Party that: (a) Debtor shall
have, and Debtor shall continue to have, good and marketable title
to the Securities, free from any Liens, encumbrances, defenses and
adverse claims other than the Liens created by this Agreement, the
rights of
Borrower’s customers with respect to
Collateral consisting of customer securities, and Permitted Liens;
(b) Debtor will defend the Securities against all claims or
demands of all Persons (other than Secured Party and holders of
Permitted Liens) claiming the Securities or any interest therein;
(c) immediately upon the delivery and pledge of any Securities
as herein contemplated, Secured Party will have a first and prior
security interest in (and upon foreclosure as contemplated by this
Agreement, Secured Party will have good title to, and will be the
sole owner of) each of the Securities so delivered and pledged,
free and clear of any other pledge, Lien, encumbrance or security
interest other than Permitted Liens; and (d) as of the date
delivered, all Securities delivered under this Agreement shall be,
to the best knowledge of the Officers, free from
default.
SECTION 3. COLLATERAL -
SECURITIES .
3.01 If at any time and from time to
time Secured Party determines that the total amount of all then
outstanding Advances on any date are greater than the Borrowing
Base as in effect on such date, Debtor shall, consistent with and
as required under Section 2.01 of the Loan Agreement,
immediately either (a) prepay the amount by which the total
amount of all then outstanding Advances exceed the Borrowing Base,
or (b) deliver to Secured Party additional Securities, such
that following said prepayment or delivery, the total amount of all
then outstanding Advances no longer exceed the Borrowing
Base.
3.02 Upon the occurrence and
continuation of any Event of Default, that portion of the pledged
Securities consisting of distributions and payments upon or in
connection therewith (whether such distributions or payments are
dividends, interest, principal or other distributions, or in
partial or complete liquidation, or the result of reclassification,
readjustment or other changes in the capital structure of the
Persons issuing the same or otherwise) shall be delivered by Debtor
to Secured Party in the form that the distribution or payment is
received by Debtor, and Secured Party shall hold any such
distribution or payment as additional Collateral to secure the
Borrower’s Obligations. Any shares of capital stock,
securities or evidence of indebtedness so distributed to Debtor
shall be delivered to Secured Party accompanied with irrevocable
stock powers relating thereto or assignments thereof duly signed by
Debtor in form acceptable to Secured Party and duly endorsed in
blank by Debtor.
3.03 Upon the occurrence and
continuation of any Event of Default, that portion of the pledged
Securities consisting of subscriptions, warrants, options and any
other rights issued upon or in connection therewith or any portion
thereof, shall be delivered by Debtor to Secured Party, and Secured
Party shall hold such subscriptions, warrants, options and other
rights to secure Borrower’s Obligations; provided ,
however , that if Secured Party determines in its sole
discretion that the value of any of such subscriptions, warrants,
options or other rights shall terminate, expire or be materially
reduced by holding the same as Collateral, Secured Party shall have
the right, in its sole discretion, to sell or exercise the same,
and if exercised, then the monies disbursed by Secured Party in
connection therewith shall be deemed Advances by Secured Party to
Debtor, and shall constitute part of Borrower’s Obligations,
payable by Debtor to Secured Party on demand.
3.04 Upon the occurrence and
continuation of any Event of Default, and after written notice to
Debtor, Secured Party may transfer any or all of the Securities
into the name of Secured Party, or into the name of Secured
Party’s nominee, without disclosing that such Securities so
transferred are pledged or hypothecated, and without any indication
on any new certificate or other document issued to evidence such
Securities, that such Securities are pledged, and the Persons
issuing the same, or their transfer agents, shall not be bound to
inquire in the event that Secured Party or said nominee makes any
other transfer of the Securities, as to whether Secured Party or
its nominee has the right to make such further transfer, and the
Persons issuing the same, or their transfer agents, shall not be
liable for transferring the same.
3.05 Unless and until an Event of
Default shall have occurred and is continuing, Debtor shall be
entitled to exercise any and all voting or consensual rights and
powers and stock purchase or subscription rights relating or
pertaining to the Securities or any part thereof for any purpose;
provided , however , that Debtor agrees that it will
not exercise or refrain from exercising any such right or power if,
as a result of so doing, it would have a Material Adverse Effect on
the value of the Securities or any part thereof.
3.06 Debtor further warrants and
represents to Secured Party, to its knowledge, that: (a) the
Securities are, and/or upon issuance thereof will be, validly
is
