Pledge Agreement for Certificated Securities

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This Pledge Agreement for Certificated Securities is between a debtor and secured party. In this agreement the debtor grants a security interest in stock for use as collateral for a loan.

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This Pledge Agreement for Certificated Securities is between a debtor and secured party in which the debtor agrees to grant the secured party a security interest in stock or other security to be used in conjunction with a loan document. This agreement sets forth the specifics about the collateral (number of shares, certificate numbers and name of issuer), debtor's obligations and remedies in the event of default. When all obligations have been fully discharged, the secured party will return the collateral (in this case the securities) held under this agreement to the debtor.

This Pledge Agreement for Certificated Securities contains the following:
  • Parties: Sets forth the names and addresses of the secured party and debtor who will grant a security interest;
  • Secured Interest: Sets out that debtor will grant a security interest and will execute a custody agreement and deliver a stock certificate representing said collateral to custodian;
  • Covenants of Debtor: Sets out that debtor will keep collateral free of liens and other security interests and an agreement not to sell the collateral;
  • Default/Remedies: Specifies the remedies which can be taken in the event of debtor's default on any agreement provisions;
  • Termination/Release: Specifies that the collateral will be released when all obligations have been fully discharged, and that debtor may procure all security held by the custodian at that time;
  • Signatures: Both parties must sign this agreement.

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This attorney-prepared packet contains:
  1. General Information
  2. Instructions and Checklist
  3. Pledge Agreement for Certificated Securities
State Law Compliance: This form complies with the laws of all states
This is the content of the form and is provided for your convenience. It is not necessarily what the actual form looks like and does not include the information, instructions and other materials that come with the form you would purchase. An actual sample can also be viewed by clicking on the "Sample Form" near the top left of this page.
 
 
Pledge Agreement
for Certificated Securities

 

THIS PLEDGE AGREEMENT (Agreement”) is entered into this __________________ day of __________________[month], __________________[year], by __________________ (Debtor”), whose address is __________________, and __________________ (Secured Party”), whose address is __________________.
Recitals
Debtor and Secured Party are parties to a certain loan agreement __________________[name and/or description of agreement if necessary] dated __________________ (Loan Agreement”). [A copy of the Loan Agreement is attached to this Pledge Agreement.]
As security for the performance of Debtors obligations to the Secured Party under the Loan Agreement, it is Debtors intent to cause to be created and granted to the Secured Party a security interest in certain property of Debtor, as provided in this Pledge Agreement.
Agreement
[In consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,] Debtor and Secured Party agree as follows:
Collateral.Collateral” means __________________[number of shares] shares of stock of __________________[name of issuer], currently represented by certificate no[s]. ____________.
Grant of Security Interest. Debtor hereby grants to Secured Party a security interest in the Collateral to secure payment and performance of the obligations of Debtor to the Secured Party, as defined in Paragraph 3 below (referred to collectively and severally as the Obligations”). Contemporaneously with the execution of this Agreement, Debtor is executing a Custody Agreement and delivering to the custodian named therein (the Custodian”) a stock certificate representing the Collateral, along with appropriate transfer forms executed in blank, which the Custodian shall hold in trust for the Secured Party pursuant to the Custody Agreement. So long as an Event of Default as defined in Paragraph 6 of this Pledge Agreement has not occurred, all dividends and distributions with respect to the Collateral shall be paid to Debtor.
Obligations. The Obligations of Debtor secured by this Agreement shall consist of the obligations of Debtor set forth in the Loan Agreement.
Covenants of Debtor. Debtor hereby agrees to do all of the following:
Procure, execute and deliver from time to time any endorsements, assignments and other writings deemed necessary or appropriate by the Secured Party to perfect, maintain and protect the security interest created hereunder and the priority thereof, and pay promptly all related filing fees, stamp taxes or similar costs and expenses;
Not to sell, encumber, or otherwise dispose of or transfer any Collateral or tight or interest therein;
Keep the Collateral free of all levies and security interests or other liens or charges; and
Provide the Secured Party promptly, and in any event within three days, after the occurrence of each Event of Default, or each event that with the lapse of time or giving or notice or both would constitute an Event of Default, the statement of Debtor setting forth details of that Event of Default or event and the action that Debtor proposes to take with respect to that event.
Authorized Action by Secured Party. Debtor hereby irrevocably appoints Secured Party as its attorney in fact to do any act that Debtor is obligated by this Agreement to do and to exercise such rights and powers as Debtor might exercise with respect to the Collateral. Immediately and without further notice, upon the occurrence of an Event of Default, Secured Party or its nominee shall have the right to exercise all voting rights and all other rights pertaining thereto, and Debtor hereby grants an irrevocable proxy to Secured Party with respect to the Collateral.
Event of Default. Debtor shall be deemed in default under this Agreement upon the occurrence of a breach by Debtor of any of its material obligations under the Loan Agreement. Each such occurrence shall be termed an Event of Default.
Remedies on Default. On the occurrence of any Event of Default, the following shall apply:
Secured Party shall have the right, to the full extent permitted by law, and Debtor shall take all actions that may be necessary or appropriate to give effect to that right, to vote and to give consents, ratifications and waivers and to take any other action with respect to the Collateral with the same force and effect as if the Secured Party were the absolute and sole owner thereof.
Secured Party may exercise all the rights and remedies of a secured party under applicable law and, in addition, Secured Party may, without being required to give any notice, except as hereinafter provided, or as may be required by mandatory provisions of law, do either or both of the following:
(1) Apply the cash, if any, then held by it as Collateral hereunder to the Obligations; and
(2) If there is no such cash, or if such cash is insufficient to pay all the Obligations in full, sell all or any part of the Collateral at public or private sale, for cash, on credit or for future delivery, and at any price or prices that Secured Party may deem satisfactory.
Secured Party may be the purchaser of any or all of the Collateral sold at any public or private sale under subparagraph (b)(2), above, and thereafter hold the Collateral so purchased absolutely free from any right or claim of any kind. On any such sale, Secured Party shall have the right to deliver, assign and transfer to the purchaser the shares of Collateral so sold. Secured Party shall give Debtor at least seven days written notice of its intention to make any such public or private sale. Secured Party shall not be obligated to make any such sale following any such notice. Secured Party, instead of exercising the power of sale herein conferred on it, may proceed by a suit or suits at law or in equity to foreclose the security interests granted in this Pledge Agreement, and sell all or any part of the Collateral under a judgment or decree of a court or courts of competent jurisdiction.
Termination and Release of Collateral. When all of the Obligations have been fully and completely discharged, Secured Party shall procure the return to Debtor of the Collateral then held by the Custodian under this Agreement, whereupon Secured Partys duties and responsibilities with respect to the Collateral and this Agreement shall cease and terminate.
Cumulative Rights. The rights, powers and remedies of Secured Party under this Agreement shall be in addition to all rights, powers and remedies given to Secured Party by virtue of any statute or rule of law, [a shareholders' agreement], or any other agreement between Debtor and Secured Party, all of which rights, powers and remedies shall be cumulative and may be exercise successively or concurrently without impairing Secured Partys security interest in the Collateral.
Waiver. (a) Any forbearance, failure or delay by Secured Party in exercising any right, power or remedy shall not preclude the further exercise thereof, and every right, power and remedy of Secured Party shall continue in full force and effect until that right, power or remedy is specifically waived in a writing executed by Secured Party.
Debtor waives any right to require Secured Party
(1) To proceed against any person, firm or corporation;
(2) To exhaust any Collateral it may hold at any time;
(3) To apply any Collateral in any order; or
(4) To pursue any other remedy whatsoever in Secured Partys power.
Debtor further waives, to the full extent permitted by law, all rights to notice or a judicial hearing prior to the time Secured Party takes possession or disposes of the Collateral upon default as provided in Paragraph 7.
Binding on Successors. All rights of the parties under this Agreement shall inure to the benefit of their heirs, executors, administrators, successors and permitted assigns, and all obligations of the parties under this Agreement shall bind their heirs, executors, administrators, successor and permitted assigns. Except as expressly provided herein, nothing in this Agreement is intended to provide any rights or remedies to any person other than the parties to this Agreement and their heirs, executors, administrators, successors and permitted assigns.
Entire Agreement; Severability. This Agreement constitutes a final written expression of all of the terms of the agreement among the parties regarding the subject matter of this Agreement, is a complete and exclusive statement of those terms and supersedes all prior agreements, understandings and representations between or among the parties relating the subject matter of this Agreement. If any of the provisions of this Agreement shall be held invalid or unenforceable, this Agreement shall be construed as if not containing those provisions, and the rights and obligations of the parties to this Agreement shall be construed and enforced accordingly.
Notices. Any notice or other communication under or in connection with this Agreement shall be made in writing and shall be delivered personally or sent by courier or certified mail return receipt requested as follows:
Secured Party:  __________________
__________________ [address]
Debtor:  __________________
__________________ [address]
Any party may specify a different address to which notice may be sent by giving notice in writing to the other party. In the absence of evidence of earlier receipt, any notice or other communication shall be deemed to have been duly given,
If delivered personally, on the date when left at the address.
If sent by courier, three days after posting it.
If sent by mail, seven days after posting it.
References. Whenever required by the context of this Agreement, the singular number shall include the plural, and vice versa; and the neuter gender shall include the masculine and feminine genders. As used in this Agreement, the work “including” shall not be deemed to be a words of limitation, and accordingly shall be deemed to be followed by the words “without limitation.” As used in this Agreement, the term “person” shall be deemed to refer to any individual, entity (including corporation, joint stock company, limited liability company, general partnership, limited partnership or joint venture), government (or political subdivision thereof) or governmental agency, authority or instrumentality.
Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of ______________ [state], without giving effect to ______________ [state]s principles of conflict of laws.
Amendment. This Agreement may not be modified except in a writing signed by the parties. This Agreement may not be modified by an oral agreement, even if supported by new consideration.
Venue and Jurisdiction. If any legal proceeding or other legal action relating to this Agreement is brought or otherwise initiated, the venue shall be in __________________[name of city or county], ______________ [state] (which shall be deemed a convenient forum) or, at the election of the party initiating the action, the county in which the other party resides or has located its principle place of business. The parties to this Agreement expressly and irrevocable consent and submit to the jurisdiction of the courts of the State of ______________ [state].
Interpretation of Agreement. Each party to this Agreement acknowledges that it has participated in the drafting of this Agreement, and any applicable rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in connection with the construction or interpretation of this Agreement.
Headings. The underlined headings contained in this Agreement are for convenience or reference only, shall not be deemed to be a part of this Agreement, and shall not be referred to in connection with the construction or interpretation of this Agreement.
Counterparts. This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall be an original, and all the counterparts together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Pledge Agreement on the date written at the beginning of the Agreement.
DEBTOR:
__________________ [signature of debtor]
__________________ [typed name]
 
SECURED PARTY:
__________________ [signature of secured party]
__________________ [typed name]
 
Number of Pages9
DimensionsDesigned for Letter Size (8.5" x 11")
EditableYes (.doc, .wpd and .rtf)
UsageUnlimited number of prints
Product number#43648
This is the content of the form and is provided for your convenience. It is not necessarily what the actual form looks like and does not include the information, instructions and other materials that come with the form you would purchase. An actual sample can also be viewed by clicking on the "Sample Form" near the top left of this page.
 
 
Pledge Agreement
for Certificated Securities

 

THIS PLEDGE AGREEMENT (Agreement”) is entered into this __________________ day of __________________[month], __________________[year], by __________________ (Debtor”), whose address is __________________, and __________________ (Secured Party”), whose address is __________________.
Recitals
Debtor and Secured Party are parties to a certain loan agreement __________________[name and/or description of agreement if necessary] dated __________________ (Loan Agreement”). [A copy of the Loan Agreement is attached to this Pledge Agreement.]
As security for the performance of Debtors obligations to the Secured Party under the Loan Agreement, it is Debtors intent to cause to be created and granted to the Secured Party a security interest in certain property of Debtor, as provided in this Pledge Agreement.
Agreement
[In consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,] Debtor and Secured Party agree as follows:
Collateral.Collateral” means __________________[number of shares] shares of stock of __________________[name of issuer], currently represented by certificate no[s]. ____________.
Grant of Security Interest. Debtor hereby grants to Secured Party a security interest in the Collateral to secure payment and performance of the obligations of Debtor to the Secured Party, as defined in Paragraph 3 below (referred to collectively and severally as the Obligations”). Contemporaneously with the execution of this Agreement, Debtor is executing a Custody Agreement and delivering to the custodian named therein (the Custodian”) a stock certificate representing the Collateral, along with appropriate transfer forms executed in blank, which the Custodian shall hold in trust for the Secured Party pursuant to the Custody Agreement. So long as an Event of Default as defined in Paragraph 6 of this Pledge Agreement has not occurred, all dividends and distributions with respect to the Collateral shall be paid to Debtor.
Obligations. The Obligations of Debtor secured by this Agreement shall consist of the obligations of Debtor set forth in the Loan Agreement.
Covenants of Debtor. Debtor hereby agrees to do all of the following:
Procure, execute and deliver from time to time any endorsements, assignments and other writings deemed necessary or appropriate by the Secured Party to perfect, maintain and protect the security interest created hereunder and the priority thereof, and pay promptly all related filing fees, stamp taxes or similar costs and expenses;
Not to sell, encumber, or otherwise dispose of or transfer any Collateral or tight or interest therein;
Keep the Collateral free of all levies and security interests or other liens or charges; and
Provide the Secured Party promptly, and in any event within three days, after the occurrence of each Event of Default, or each event that with the lapse of time or giving or notice or both would constitute an Event of Default, the statement of Debtor setting forth details of that Event of Default or event and the action that Debtor proposes to take with respect to that event.
Authorized Action by Secured Party. Debtor hereby irrevocably appoints Secured Party as its attorney in fact to do any act that Debtor is obligated by this Agreement to do and to exercise such rights and powers as Debtor might exercise with respect to the Collateral. Immediately and without further notice, upon the occurrence of an Event of Default, Secured Party or its nominee shall have the right to exercise all voting rights and all other rights pertaining thereto, and Debtor hereby grants an irrevocable proxy to Secured Party with respect to the Collateral.
Event of Default. Debtor shall be deemed in default under this Agreement upon the occurrence of a breach by Debtor of any of its material obligations under the Loan Agreement. Each such occurrence shall be termed an Event of Default.
Remedies on Default. On the occurrence of any Event of Default, the following shall apply:
Secured Party shall have the right, to the full extent permitted by law, and Debtor shall take all actions that may be necessary or appropriate to give effect to that right, to vote and to give consents, ratifications and waivers and to take any other action with respect to the Collateral with the same force and effect as if the Secured Party were the absolute and sole owner thereof.
Secured Party may exercise all the rights and remedies of a secured party under applicable law and, in addition, Secured Party may, without being required to give any notice, except as hereinafter provided, or as may be required by mandatory provisions of law, do either or both of the following:
(1) Apply the cash, if any, then held by it as Collateral hereunder to the Obligations; and
(2) If there is no such cash, or if such cash is insufficient to pay all the Obligations in full, sell all or any part of the Collateral at public or private sale, for cash, on credit or for future delivery, and at any price or prices that Secured Party may deem satisfactory.
Secured Party may be the purchaser of any or all of the Collateral sold at any public or private sale under subparagraph (b)(2), above, and thereafter hold the Collateral so purchased absolutely free from any right or claim of any kind. On any such sale, Secured Party shall have the right to deliver, assign and transfer to the purchaser the shares of Collateral so sold. Secured Party shall give Debtor at least seven days written notice of its intention to make any such public or private sale. Secured Party shall not be obligated to make any such sale following any such notice. Secured Party, instead of exercising the power of sale herein conferred on it, may proceed by a suit or suits at law or in equity to foreclose the security interests granted in this Pledge Agreement, and sell all or any part of the Collateral under a judgment or decree of a court or courts of competent jurisdiction.
Termination and Release of Collateral. When all of the Obligations have been fully and completely discharged, Secured Party shall procure the return to Debtor of the Collateral then held by the Custodian under this Agreement, whereupon Secured Partys duties and responsibilities with respect to the Collateral and this Agreement shall cease and terminate.
Cumulative Rights. The rights, powers and remedies of Secured Party under this Agreement shall be in addition to all rights, powers and remedies given to Secured Party by virtue of any statute or rule of law, [a shareholders' agreement], or any other agreement between Debtor and Secured Party, all of which rights, powers and remedies shall be cumulative and may be exercise successively or concurrently without impairing Secured Partys security interest in the Collateral.
Waiver. (a) Any forbearance, failure or delay by Secured Party in exercising any right, power or remedy shall not preclude the further exercise thereof, and every right, power and remedy of Secured Party shall continue in full force and effect until that right, power or remedy is specifically waived in a writing executed by Secured Party.
Debtor waives any right to require Secured Party
(1) To proceed against any person, firm or corporation;
(2) To exhaust any Collateral it may hold at any time;
(3) To apply any Collateral in any order; or
(4) To pursue any other remedy whatsoever in Secured Partys power.
Debtor further waives, to the full extent permitted by law, all rights to notice or a judicial hearing prior to the time Secured Party takes possession or disposes of the Collateral upon default as provided in Paragraph 7.
Binding on Successors. All rights of the parties under this Agreement shall inure to the benefit of their heirs, executors, administrators, successors and permitted assigns, and all obligations of the parties under this Agreement shall bind their heirs, executors, administrators, successor and permitted assigns. Except as expressly provided herein, nothing in this Agreement is intended to provide any rights or remedies to any person other than the parties to this Agreement and their heirs, executors, administrators, successors and permitted assigns.
Entire Agreement; Severability. This Agreement constitutes a final written expression of all of the terms of the agreement among the parties regarding the subject matter of this Agreement, is a complete and exclusive statement of those terms and supersedes all prior agreements, understandings and representations between or among the parties relating the subject matter of this Agreement. If any of the provisions of this Agreement shall be held invalid or unenforceable, this Agreement shall be construed as if not containing those provisions, and the rights and obligations of the parties to this Agreement shall be construed and enforced accordingly.
Notices. Any notice or other communication under or in connection with this Agreement shall be made in writing and shall be delivered personally or sent by courier or certified mail return receipt requested as follows:
Secured Party:  __________________
__________________ [address]
Debtor:  __________________
__________________ [address]
Any party may specify a different address to which notice may be sent by giving notice in writing to the other party. In the absence of evidence of earlier receipt, any notice or other communication shall be deemed to have been duly given,
If delivered personally, on the date when left at the address.
If sent by courier, three days after posting it.
If sent by mail, seven days after posting it.
References. Whenever required by the context of this Agreement, the singular number shall include the plural, and vice versa; and the neuter gender shall include the masculine and feminine genders. As used in this Agreement, the work “including” shall not be deemed to be a words of limitation, and accordingly shall be deemed to be followed by the words “without limitation.” As used in this Agreement, the term “person” shall be deemed to refer to any individual, entity (including corporation, joint stock company, limited liability company, general partnership, limited partnership or joint venture), government (or political subdivision thereof) or governmental agency, authority or instrumentality.
Choice of Law. This Agreement shall be governed by and construed in accordance with the laws of the State of ______________ [state], without giving effect to ______________ [state]s principles of conflict of laws.
Amendment. This Agreement may not be modified except in a writing signed by the parties. This Agreement may not be modified by an oral agreement, even if supported by new consideration.
Venue and Jurisdiction. If any legal proceeding or other legal action relating to this Agreement is brought or otherwise initiated, the venue shall be in __________________[name of city or county], ______________ [state] (which shall be deemed a convenient forum) or, at the election of the party initiating the action, the county in which the other party resides or has located its principle place of business. The parties to this Agreement expressly and irrevocable consent and submit to the jurisdiction of the courts of the State of ______________ [state].
Interpretation of Agreement. Each party to this Agreement acknowledges that it has participated in the drafting of this Agreement, and any applicable rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be applied in connection with the construction or interpretation of this Agreement.
Headings. The underlined headings contained in this Agreement are for convenience or reference only, shall not be deemed to be a part of this Agreement, and shall not be referred to in connection with the construction or interpretation of this Agreement.
Counterparts. This Agreement may be executed in any number of counterparts, each of which when executed and delivered shall be an original, and all the counterparts together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Pledge Agreement on the date written at the beginning of the Agreement.
DEBTOR:
__________________ [signature of debtor]
__________________ [typed name]
 
SECURED PARTY:
__________________ [signature of secured party]
__________________ [typed name]
 

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