Pledge of Shares of Stock as Collateral Security

Pledge of Shares of Stock as Collateral Security letter is something you probably won’t need often, but in case you do, here's a sample letter to use as the skeleton for your own agreement form.

If this is your first time entering into this type of agreement you may have no idea where to start to protect yourself.

Well, don’t spend hours trying to compose a letter that includes all important details.

Instead, use this “ready to go” letter below and fill in your situation specific details to get it finalized.


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PLEDGE OF SHARES OF STOCK

 

FOR VALUE RECEIVED, the undersigned hereby deposits and pledges with _ [Pledgee] as collateral security to secure the payment of:

[Describe debt]

           _____________________________________________________

           ______________________________________________________

 

The following shares of stock, described as [_] shares of stock of _ [Corporation] being stock certificate no. _.  It is understood and agreed:

 

     1. Pledgee may assign or transfer said debt and the stock

        collateral pledged hereunder.

     2. In the event there shall be stock dividend or further

        issue of stock in the Corporation to the undersigned,

        the undersigned shall pledge said shares as additional

        collateral for the debt.

     3. That during the pendency of this pledge agreement, the

        undersigned shall have full rights to vote said shares

        and be entitled to all dividend income.

     4. That during the pendency of this agreement, the

        undersigned shall not issue any proxy or assignment of

        rights to the pledged shares.

     5. The undersigned warrants and represents it has good

        title to the shares being pledged, they are free from

        other liens and encumbrances, and the undersigned has

        full authority to transfer said shares as collateral

        security.

     6. In the event of default of payment of the debt, or

        breach of this pledge agreement, the Pledgee or holder

        shall have full rights to foreclose on the pledged

        shares and excercise its rights as a secured party

        pursuant to Article 9 of the Uniform Commercial Code;

        said rights being cumulative with any other rights the

        Pledgee may have against the undersigned.

  

Signed under seal this _ day of _, 19_.

 

    ________________________________

 

Related Pages
Notice to Prior Secured Party of Purchase Money Security Interest
Discharge of Security Interest Form
Promissory Note Installment with Acceleration Clause

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