Pledge Agreement (33K)
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PLEDGE AGREEMENT
PLEDGE AGREEMENT (as amended, supplemented, amended and
restated, restructured or otherwise modified from time to time, the
"Agreement"), dated as of June 28, 2001, made by UNITED INDUSTRIAL CORPORATION
("UIC"), a Delaware corporation DETROIT STOKER COMPANY ("Detroit"), a Michigan
corporation, and AAI CORPORATION ("AAI") a Maryland corporation (each a
"Pledgor" and collectively the "Pledgors"), to FLEET CAPITAL CORPORATION, a
Rhode Island corporation (together with any successors, the "Lender").
W I T N E S S E T H :
WHEREAS, Lender and each of UIC and the following of its
subsidiaries: AAI, Detroit, AAI/ACL Technologies, Inc. ("ACL"), AAI Engineering
Support Inc. ("ESI"), and Midwest Metallurgical Laboratory, Inc. ("Midwest") (in
such capacity, each a "Borrower" and collectively the "Borrowers") have entered
into a Loan and Security Agreement dated as of June 28, 2001 (said Agreement, as
it may hereafter be amended or otherwise modified from time to time, being the
"Loan Agreement", the terms defined therein and not otherwise defined herein
being used herein as therein defined).
WHEREAS, each Pledgor shall receive a portion of the
proceeds of the Loans under the Loan Agreement and will derive substantial
direct and indirect benefit from the transactions contemplated by the Loan
Agreement and the other Loan Documents.
WHEREAS, each Pledgor is the owner of the Capital Stock of
the Subsidiaries listed and as more fully described in Schedule I hereto (the
"Pledged Capital Stock").
WHEREAS, as security for the Pledge Obligations (as
hereinafter defined), Lender has requested that Pledgors, as owners of the
Pledged Capital Stock, pledge such Pledged Capital Stock to the Lender pursuant
to the terms of this Agreement.
NOW, THEREFORE, in consideration of the premises and in
order to induce the Lender to make the Loans under the Loan Agreement, Pledgors
hereby jointly severally agrees with the Lender as follows:
SECTION 1. Pledge. Pledgors hereby pledge to Lender for its
benefit, and grants to Lender for its benefit a security interest in, the
following (the "Pledged Collateral"):
(i) the Pledged Capital Stock, the certificates
representing the Pledged Capital Stock, and all dividends, cash,
instruments and other property from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all
of the Pledged Capital Stock;
(ii) all additional Capital Stock from time to time
acquired by Pledgor in any manner, and the certificates representing
such additional Capital Stock, and all dividends, cash, instruments
and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of
the Pledged Capital Stock; and
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(iii) all proceeds, whether now or hereafter existing, of
any and all of the foregoing Pledged Collateral (including, without
limitation, proceeds that constitute property of the types described
above).
SECTION 2. Security for Guaranty Obligations. This
Agreement secures the payment of the Obligations whether now or hereafter
existing under the Loan Agreement and all obligations of the Pledgors now or
hereafter existing under this Agreement (collectively the "Pledge Obligations").
Without limiting the generality of the foregoing, this Agreement grants to the
Lender a first priority security interest in the Pledged Collateral, securing
the payment in full of the Pledge Obligations owed to Lender pursuant to the
Loan Documents.
SECTION 3. Delivery of Pledged Collateral. All certificates
or instruments representing or evidencing the Pledged Collateral shall be
delivered to and held by or on behalf of the Lender pursuant hereto and shall be
in suitable form for transfer by delivery, or shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to Lender. For the better perfection of Lender's rights
in and to the Pledged Collateral, Lender shall have the right at any time in its
discretion and without notice to Pledgors, to cause such Pledged Collateral to
be registered in the name of Lender or such nominee or nominees of Lender as
Lender shall direct, subject only to the revocable rights specified in Section
6(a).
SECTION 4. Representations and Warranties. Each Pledgor
jointly and severally represents and warrants as to itself and its Subsidiaries
listed on Schedule I hereto, to the extent applicable, as follows:
(a) Representations and Warranties. Each Pledgor hereby
represents and warrants to the Lender, without duplication, as to all matters
contained in Section 7 of the Loan Agreement, and each other Loan Document (in
each case insofar as they are applicable to the Pledgors), together with all
related definitions and ancillary provisions, all of which are hereby
incorporated into this Section 4(a) by reference as though specifically set
forth in this Section. Each Pledgor further represents and warrants that it has
reviewed in full the terms and provisions of the Loan Agreement and such other
Loan Documents.
(b) This Agreement and each other agreement or undertaking
executed by the Pledgors and delivered to the Lender pursuant hereto,
constitutes the legal, valid and binding obligation of each such Pledgor,
enforceable against each such Pledgor in accordance with its terms, and there
are no actions, suits or proceedings pending or, to the knowledge of any
Pledgor, threatened against, or affecting, any Pledgor or any of its officers
calling into question the legality, validity or enforceability of any thereof.
(c) Neither the execution and delivery of this Agreement
nor any of the instruments and documents to be delivered pursuant to this
Agreement nor the consummation of the transactions herein and therein
contemplated, nor compliance with the provisions hereof or thereof will violate
any law or regulation, or any order or decree of any court or governmental
instrumentality, or will conflict with, or result in the breach of, or
constitute a default under, any indenture, mortgage, mortgage deed, deed of
trust, agreement or other instrument to which any Pledgor is a party or by which
it may be bound, or result in the creation or imposition of any Lien upon any of
the properties thereof in violation of this Agreement, or violate any provision
of the certificate of incorporation or other charter or organizational documents
(the "Charter Documents") of such Pledgor or any issuer of the Pledged Capital
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Stock (an "Issuer") or any provisions relating to the Pledged Capital Stock,
which violation, conflict, breach, default, creation or imposition would result
in a Material Adverse Effect. No Charter Documents of any Pledgor or any Issuer
shall be amended in any manner which would impair the rights of Lender under the
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