Master Pledge Agreement

Exhibit 10.10


MASTER PLEDGE AGREEMENT


THIS MASTER PLEDGE AGREEMENT (this "Agreement"), dated as of April __, 2004, is by and between each of the Persons designated as a Pledgor on the signature pages attached hereto (each, a "Pledgor" and collectively, the "Pledgors"), and LaSalle Business Credit, LLC, as agent (the "Pledgee") for itself and the Lenders (as defined herein).


W I T N E S S E T H:


WHEREAS, Easy Gardener Products, Ltd., a Texas limited partnership (the "Borrower"), EYAS International, Inc., a Texas corporation, EG Product Management, L.L.C., a Texas limited liability company, EG, L.L.C., a Nevada limited liability company, Weatherly Consumer Products Group, Inc., a Delaware corporation, Weatherly Consumer Products, Inc., a Delaware corporation, NBU Group, LLC, a Texas limited liability company, the Pledgee, as agent for itself and certain other lenders from time to time party thereto (the "Lenders") and such Lenders, are parties to that certain Loan and Security Agreement of even date herewith (as amended, amended and restated or otherwise modified from time to time, the "Loan Agreement"; capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Loan Agreement), pursuant to which the Pledgee and the Lenders have agreed to extend loans and certain other financial accommodations to the Borrower, and the Borrower and Pledgors have granted to the Pledgee, for the benefit of Pledgee and the Lenders, a security interest in substantially all of their respective assets;


WHEREAS, each Pledgor (other than the Borrower) has executed a certain Continuing Unconditional Guaranty of even date herewith (the "Guaranty") in favor of Pledgee, for the benefit of Pledgee and the Lenders, pursuant to which each Pledgor (other than the Borrower) has jointly and severally guaranteed all of the Liabilities, as such term is defined in the Loan Agreement;


WHEREAS, the extension of credit, as aforesaid, by Pledgee and the Lenders is necessary and desirable to the conduct and operation of the business of the Borrower and will inure to the personal and financial benefit of each Pledgor;


WHEREAS, each Pledgor is the record and beneficial owner of 100% of the issued and outstanding equity interests of each issuer ("Issuer") of stock, membership units, partnership interests, bonds and/or other equity interests, as set forth on Schedule I attached hereto and made a part hereof, and each Pledgor may in the future acquire additional stock, membership units, partnership interests, bonds and/or other equity interests (all of such now owned or hereafter acquired stock, membership units, partnership interests, bonds and/or other equity interests being collectively referred to herein as the "Pledged Shares");


NOW, THEREFORE, for good and valuable consideration, the receipt, sufficiency and adequacy of which are hereby acknowledged, each Pledgor hereby agrees as follows:


1. Pledge. Each Pledgor hereby pledges to the Pledgee, for the benefit of Pledgee and the Lenders, and grants to the Pledgee, for the benefit of Pledgee and the Lenders, a security interest in, the following (the "Pledged Collateral"):


(a) the Pledged Shares now owned by such Pledgor and the certificates, if any, representing such Pledged Shares, and all dividends, cash, securities, instruments, rights and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such Pledged Shares;


(b) all additional shares of said stock, membership units, partnership interests, bonds and/or other equity interests acquired by such Pledgor in any manner, and the certificates, if any, representing such additional stock, membership units, partnership interests, bonds and/or other equity interests (any such additional stock, membership units, partnership interests, bonds, and/or other equity interests shall constitute part of the Pledged Shares under and as defined in this Agreement), and all dividends, cash, instruments, subscription warrants, securities and any other rights and options and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such stock, membership units, partnership interests, bonds and/or other equity interests; and


(c) all other property hereafter delivered to the Pledgee in substitution for, as proceeds of, or in addition to any of the foregoing, all certificates, instruments and documents representing or evidencing such property, and all cash, securities, interest, dividends, rights and other property at any time and from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all thereof.


2. Security for Liabilities. The Pledged Collateral secures the payment and performance of (i) all of the obligations, liabilities and indebtedness of each Pledgor (other than the Borrower) under the Guaranty, (ii) all of the obligations, liabilities and indebtedness of the Borrower under the Loan Agreement and the Other Agreements, and (iii) and all obligations of each Pledgor now or hereafter existing under this Agreement (all such obligations, liabilities and indebtedness under the Guaranty and the Loan Agreement, and all such obligations of each Pledgor now or hereafter existing under this Agreement being referred to herein as the "Liabilities").


3. Delivery of Pledged Shares. Except as provided in the Loan Agreement, all certificates, instruments or documents, if any, representing or evidencing the Pledged Shares shall be delivered to and held by or on behalf of the Pledgee pursuant hereto and shall be in suitable form for transfer by delivery, shall be accompanied by duly executed instruments of transfer or assignment in blank, all in form and substance satisfactory to the Pledgee. In the event any or all of the Pledged Shares are evidenced by a book entry, the Pledgors shall execute and deliver or cause to be executed and delivered to Pledgee such control agreements, documents, and agreements as are required by Pledgee to create and perfect a security interest in such uncertificated Pledged Shares. In addition, the Pledgee shall have the right at any time to exchange certificates or instruments representing or evidencing Pledged Shares for certificates or instruments of smaller or larger denominations.


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4. Representations and Warranties. Each Pledgor represents and warrants as follows:


(a) The Pledged Shares have been duly authorized and validly issued and are fully paid and non-assessable.


(b) Each Pledgor is, or at the time of any future delivery, pledge, assignment or transfer will be, the legal and beneficial owner of its Pledged Collateral, free and clear of any lien, security interest, pledge, warrant, option, purchase agreement, shareholders' agreement, restriction, redemption agreement or other charge, encumbrance or restriction of any nature on such Pledged Collateral, except for (i) the lien created by this Agreement, (ii) the options and warrants issued pursuant to the Central Garden Agreements (subject to the terms and provisions of the Central Garden Subordination Agreement), and (iii) as otherwise provided in the Loan Agreement, with full right to deliver, pledge, assign and transfer such Pledged Collateral to the Pledgee as Pledged Collateral hereunder.


(c) Except as provided in the Loan Agreement, the pledge of the Pledged Collateral pursuant to this Agreement creates a valid, perfected and only security interest in the Pledged Collateral, securing the payment of the Liabilities.


(d) No authorization, approval, or other action by, and no notice to or filing with, any governmental authority or regulatory body is required either (i) for the pledge by each Pledgor of the Pledged Collateral pursuant to this Agreement or for the execution, delivery or performance of this Agreement by each Pledgor, or (ii) for the exercise by the Pledgee of the voting or other rights provided for in this Agreement or the remedies in respect of the Pledged Collateral pursuant to this Agreement (except as may be required in connection with a disposition of such shares by laws affecting the offering and sale of securities generally).


(e) Each Pledgor has full power and authority to enter into this Agreement and has the right to vote, pledge and grant a security interest in the Pledged Collateral as provided by this Agreement.


(f) None of the Pledged Shares has been issued in violation of any federal, state or other law, regulation or rule pertaining to the issuance of securities, or in violation of any rights, pre-emptive or otherwise, of any present or past stockholder of any Issuer described in Schedule I attached hereto and made a part hereof.


5. Further Assistance. Each Pledgor agrees that at any time and from time to time, at the expense of the Pledgors, the Pledgors will, except as otherwise provided in the Loan Agreement, promptly execute and deliver, or cause to be executed and delivered, all certificates, if any, representing the Pledged Shares, stock and/or bond powers, proxies, assignments, instruments and documents; will take all steps necessary to properly register the transfer of the security interest hereunder on the books of the Issuer of any uncertificated securities included in the Pledged Shares; and will take all further action that may be necessary or desirable, or that the Pledgee may request in its sole discretion, in order to


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perfect and protect any security interest granted or purported to be granted hereby or to enable the Pledgee to exercise and enforce its rights and remedies hereunder with respect to any Pledged Collateral and to carry out the provisions and purposes hereof.


6. Voting Rights; Dividends; Etc.


(a) So long as no Event of Default (as hereinafter defined) or event which, with the giving of notice or the lapse of time, or both, would become an Event of Default, shall have occurred (and be continuing):


(i) The Pledgors shall be entitled to exercise any and all
voting and other consensual rights pertaining to the Pledged Shares or any
part thereof for any purpose not inconsistent with the terms of this
Agreement or the Loan Agreement; provided, however, that the Pledgors
shall not exercise nor shall they refrain from exercising any such rights
if such action could have a material adverse effect on the value of the
Pledged Collateral or any part thereof.


(ii) The Pledgors shall be entitled to receive and retain any
and all dividends and interest paid in respect of the Pledged Collateral,
provided however, that any and all


(A) dividends and interest paid or payable other than in cash
in respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in exchange
for, any Pledged Collateral,


(B) dividends and other distributions paid or payable in cash
in respect of any Pledged Collateral in connection with a partial or
total liquidation or dissolution or in connection with a reduction
of capital, capital surplus or paid-in-surplus, and


(C) cash paid, payable or otherwise distributed in respect of
principal of, or in redemption of, or in exchange for, any Pledged
Collateral, shall be Pledged Collateral, shall be forthwith
delivered to the Pledgee to hold as Pledged Collateral and shall, if
received by any Pledgor, be received in trust for the benefit of the
Pledgee and the Lenders, be segregated from the other property or
funds of such Pledgor, and be forthwith delivered to the Pledgee as
Pledged Collateral in the same form as so received (with any
necessary endorsement).


(iii) Each Pledgor shall execute and deliver (or cause to be
executed and delivered) to the Pledgee all such proxies and other
instruments as the Pledgee may (reasonably) request for the purpose of
enabling the Pledgee to exercise the voting and other rights which it is
entitled to exercise pursuant to paragraph (i) above and to receive the
dividends or interest payments which it is authorized to receive pursuant
to paragraph (ii) ...