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Exhibit
10.2
EXECUTION VERSION
PLEDGE AGREEMENT
PLEDGE AGREEMENT, made as of
June 19, 2008, by BROOKE CAPITAL CORPORATION, a Kansas
corporation (the “ Pledgor ”), in favor of DZ
BANK AG DEUTSCHE ZENTRAL-GENOSSENSCHAFTSBANK, as agent (in such
capacity, the “ Agent ”) for AUTOBAHN FUNDING
COMPANY LLC (the “ Lender ”) in connection with
(i) that certain Amended and Restated Credit and Security
Agreement, dated as of August 29, 2006 (as amended,
supplemented or otherwise modified from time to time, the “
Credit Agreement ”), among Brooke Credit Funding, LLC,
as borrower (the “ Borrower ”), Aleritas Capital
Corp., f/k/a/ Brooke Credit Corporation (“ Brooke
Credit ”), Brooke Corporation (the “ Parent
”), the Lender and the Agent and (ii) the Brooke Capital
Guaranty (as defined in the Credit Agreement).
W I T
N E S S E T H
:
WHEREAS, pursuant to the
Credit Agreement, the Lender has agreed to make advances and loans
to the Borrower for the purposes set forth therein;
WHEREAS, the Lender has
agreed to grant waivers with respect to certain Events of Default
and Servicer Defaults (each as defined therein) pursuant to an
amendment to the Credit Agreement of even date herewith;
WHEREAS, the Pledgor is the
legal and beneficial owner of all the Pledged Equity Interests (as
hereinafter defined) issued by the Issuer (as hereinafter
defined);
WHEREAS, it is a condition
precedent to the effectiveness of the amendment to the Credit
Agreement of even date herewith that the Pledgor shall have
executed and delivered this Pledge Agreement to the Agent for the
benefit of the Lender and the other Secured Parties; and
NOW, THEREFORE, in
consideration of the premises and the waivers granted by the Agent
and the Lender pursuant to the amendment to the Credit Agreement of
even date herewith, the Pledgor hereby agrees with the Agent, for
the benefit of the Lender and the other Secured Parties, as
follows:
1. Defined Terms .
Unless otherwise defined herein, terms defined in the Credit
Agreement and used herein are used as defined therein, and the
following terms shall have the following meanings:
“ Code ”
shall mean the Uniform Commercial Code from time to time in effect
in the State of New York.
“ Collateral
” shall mean the Pledged Equity Interests and all Proceeds
(as defined below).
“ Issuer ”
shall mean Brooke Investments, Inc.
“ Obligations
” means all present and future indebtedness and other
liabilities and obligations (howsoever created, arising or
evidenced, whether direct or indirect, absolute
Schedule I
or contingent, or due or to
become due) of the Pledgor to the Lender, the Agent and/or any
other Secured Party, arising under or in connection with the Brooke
Capital Guaranty or any other Related Document or the transactions
contemplated hereby or thereby and shall include, without
limitation, all liability for costs, expenses, indemnifications,
repurchase obligations and all other amounts due or to become due
from the Pledgor under the Related Documents, including, without
limitation, interest, fees and other obligations that accrue after
the commencement of a bankruptcy, insolvency or similar proceeding
(in each case whether or not allowed as a claim in such
proceeding).
“ Pledge
Agreement ” shall mean this Pledge Agreement, as amended,
supplemented or otherwise modified from time to time.
“ Pledged Equity
Interests ” shall mean the capital stock and other equity
interests of the Issuer listed on Schedule I hereto, together with
all certificates, options or rights of any nature whatsoever that
may be issued or granted by the Issuer to the Pledgor while this
Pledge Agreement is in effect.
“ Proceeds
” shall mean all “proceeds” as such term is
defined in Article 9 of the UCC of the Code as in effect on the
date hereof (and any successor provision thereto) and, in any
event, shall include, without limitation, all dividends or other
income from the Pledged Equity Interests, collections thereon or
distributions with respect thereto.
2. Pledge; Grant of
Security Interest . The Pledgor hereby delivers to the Agent,
for the benefit of the Lender and the other Secured Parties, all
the Pledged Equity Interests, and hereby grants to the Agent, for
the benefit of the Lender and the other Secured Parties, a first
priority security interest in the Collateral, as collateral
security for the prompt and complete payment and performance when
due (whether at the stated maturity, by acceleration or otherwise)
of the Obligations.
3. Stock Powers .
Concurrently with the delivery to the Agent of each certificate
representing one or more shares of Pledged Equity Interests to the
Agent, the Pledgor shall deliver an undated stock power covering
such certificate, duly executed in blank by the Pledgor with, if
the Agent so requests, signature guaranteed.
4. [Reserved].
5. Representations and
Warranties . The Pledgor represents and warrants
that:
(a) the Pledged Equity
Interests represent all the issued and outstanding capital stock
and other equity interests in the Issuer in which the Pledgor has
any interest;
(b) all the shares of Pledged
Equity Interests have been duly and validly issued and are fully
paid and nonassessable;
(c) the Pledgor is the sole
record and beneficial owner of, and has good and marketable title
to, the Pledged Equity Interests, free of any and all Liens or
options in favor of, or claims of, any other Person, except the
Lien created by this Pledge Agreement;
Schedule I
(d) [reserved].
(e) upon delivery to the
Agent of the stock certificates evidencing the Pledged Equity
Interests, the Lien granted pursuant to this Pledge Agreement will
constitute a valid, perfected first priority Lien on the
Collateral, enforceable as such against all creditors of the
Pledgor and any Persons purporting to purchase any Collateral from
the Pledgor, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings
in equity or at law).
(f)(i) The chief executive
office of the Pledgor and the office where the Pledgor keeps its
records concerning the Pledged Equity Interests and all contracts
relating thereto is located at 7400 College Boulevard, Suite 250,
Overland Park, Kansas 66210. The Pledgor shall not establish a new
location for its chief executive office or change its name until
(i) it has given to the Agent not less than 30 days’
prior written notice of its intention to do so, clearly describing
such new location or specifying such new name, as the case may be,
and (ii) with respect to such new location or such new name,
as the case may be, it shall have taken all action, satisfactory to
the Agent, to maintain the security interest of the Agent in the
Collateral intended to be granted hereby at all times fully
perfected and in full force and effect.
(ii) The jurisdiction of
organization of the Pledgor is Kansas. The Pledgor shall not change
its jurisdiction of organization until (i) it has given to the
Agent not less than 30 days’ prior written notice of its
intention to do so, clearly describing such new jurisdiction, and
(ii) with respect to such new jurisdiction, it shall have
taken all action, satisfactory to the Agent, to maintain the
security interest of the Agent in the Collateral intended to be
granted hereby at all times fully perfected and in full force and
effect.
6. Covenants . The
Pledgor covenants and agrees with the Agent and the Lender that,
from and after the date of this Pledge Agreement until the
Obligations are paid in full and the Brooke Capital Guaranty is
terminated:
(a) If the Pledgor shall, as
a result of its ownership of the Pledged Equity Interests, become
entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a
stock dividend or a distribution in connection with any
reclassification, increase or reduction of capital or any
certificate issued in connection with any reorganization), option
or rights, whether in addition to, in substitution of, as a
conversion of, or in exchange for any shares of the Pledged Equity
Interests, or otherwise in respect thereof, the Pledgor shall
accept the same as the agent of the Agent and the Lender, hold the
same in trust for the Agent and the Lender and deliver the same
promptly, and in any event with three Business Days, to the Agent
in the exact form received, duly endorsed by the Pledgor to the
Agent, if required, together with an undated stock power covering
such certificate duly executed in blank by the Pledgor to be held
by the Agent, subject to the terms hereof, as additional collateral
security for the Obligations. Any sums paid upon or in respect of
the Pledged Equity Interests upon the liquidation or dissolution of
the Issuer shall be paid over to the Agent to be held by it
hereunder as additional collateral security for the Obligations,
and in case any
Schedule I
distribution of capital shall
be made on or in respect of the Pledged Equity Interests or any
property shall be distributed upon or with respect to the Pledged
Equity Interests pursuant to the recapitalization or
reclassification of the capital of the Issuer or pursuant to the
reorganization thereof, the property so distributed shall be
delivered to the Agent to be held by it hereunder as additional
collateral security for the Obligations. Except as provided in
Section 7 , if any sums of money or property so paid or
distributed in respect of the Pledged Equity Interests shall be
received by the Pledgor, the Pledgor shall, until such money or
property is paid or delivered to the Agent, hold such money or
property in trust for the Lender, segregated from other funds of
the Pledgor, as additional collateral security for the
Obligations.
(b) [Reserved].
(c) Without the prior written
consent of the Agent, the Pledgor will not (i) vote to enable,
or take any other action to permit, the Issuer to issue any stock
or other equity securities of any nature or to issue any other
securities convertible into or granting the right to purchase or
exchange for any stock or other equity securities of any nature of
the Issuer, (ii) sell, assign, transfer, exchange, or
otherwise dispose of, or grant any option with respect to, the
Collateral, or (iii) create, incur or permit to exist any
other Adverse Claim or option in favor of, or any claim of any
Person with respect to, any of the Collateral, or any interest
therein, except for the Adverse Claim provided for by this Pledge
Agreement. The Pledgor will defend and will indemnify and hold
harmless the Agent and the Lender against the claims and demands of
all Persons whomsoever with respect to any claim arising from or in
connection with the right, title and interest of the Agent and the
Lender in and to the Collateral.
(d) At any time and from time
to time, upon the written request of the Agent, and at the sole
expense of the Pledgor, the Pledgor will promptly and duly execute
and deliver such further instruments and documents and take such
further actions as the Agent may reasonably request for the
purposes of obtaining or preserving the full benefits of this
Pledge Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the
Collateral shall be or become evidenced by any promissory note,
other instrument or chattel paper, such note, instrument or chattel
paper shall be immediately delivered to the Agent, duly endorsed in
a manner satisfactory to the Agent, to be held as Collateral
pursuant to this Pledge Agreement.
(e) The Pledgor agrees to
pay, and to save the Ag
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