STOCK PLEDGE AGREEMENT
1. Identification.
This
Stock Pledge Agreement (the "Agreement"), dated as of March ___, 2007, is
entered into by and between Inrob Tech Ltd., a Nevada corporation (“Debtor”),
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as collateral agent acting in the manner and to the
extent described in the Collateral Agent Agreement defined below (the
"Collateral Agent"), for the benefit of the parties identified on Schedule
A
hereto (collectively, the "Lenders").
2. Recitals.
2.1 The
Lenders have made, are making and will be making loans to Debtor (the "Loans").
It is beneficial to Debtor that the Loans were made, are being made and will
be
made.
2.2 The
Loans
are evidenced by one or more convertible promissory notes (each a “Convertible
Note”) issued by Debtor on or about the date of this Agreement, and after the
date of this Agreement pursuant to one or more subscription agreements (each
a
“Subscription Agreement”) to which Debtor and Lenders are parties. The Notes are
further identified on Schedule A hereto and were and will be executed by Debtor
as “Borrower” or “Debtor” for the benefit of each Lender as the “Holder” or
“Lender” thereof.
2.3 In
consideration of the Loans made by Lenders to Debtor and for other good and
valuable consideration, and as security for the performance by Debtor of its
obligations under the Notes and as security for the repayment of the Loans
and
all other sums due from Debtor to Lenders arising under the Notes presently
outstanding or to be outstanding in the future, Subscription Agreements, and
any
of the other Transaction Documents (as defined in the Subscription Agreement)
(collectively, the "Obligations"), Debtor, for good and valuable consideration,
receipt of which is acknowledged, has agreed to grant to the Collateral Agent,
for the benefit of the Lenders, a security interest in the Collateral (as such
term is hereinafter defined), on the terms and conditions hereinafter set forth.
Obligations include all future advances by Lenders to Debtor advanced on a
pro
rata basis by all Lenders on substantially the same terms.
2.4 The
Lenders have appointed the Collateral Agent pursuant to that certain Collateral
Agent Agreement dated at or about March ___, 2007 (“Collateral Agent
Agreement”), among the Lenders and Collateral Agent.
2.5 The
Debtor, Collateral Agent and lenders acknowledge that the rights and obligations
granted to them pursuant to this Agreement are pari passu with the rights
granted to the Prior Subscribers (as defined in the Subscription Agreement)
and
this Agreement is intended to and does grant the Lenders and Collateral Agent
the same rights and benefits pari passu with the rights granted to the Prior
Subscribers in connection with the Prior Offering (as defined in the
Subscription Agreement) and are intended to be exercised and enforced as if
the
Lenders and Prior Subscribers, Debtor and Collateral Agent had executed the
same
document. Obligations as employed herein and in connection with a certain “Stock
Pledge Agreement” entered into by Debtor, Collateral Agent and Prior Subscribers
as of November 15, 2006 (“Prior Stock Pledge Agreement”) shall be cumulative of
Obligations as employed herein and “Obligations” as employed in the Prior Stock
Pledge Agreement.
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2.6 The
following defined terms which are defined in the Uniform Commercial Code in
effect in the State of New York on the date hereof are used herein as so
defined: Accounts, Chattel Paper, Documents, Equipment, General Intangibles,
Instruments, Inventory and Proceeds.
3. Grant
of General Security Interest in Collateral.
3.1 As
security for the Obligations of Debtor, Debtor hereby grants the Collateral
Agent, for the benefit of the Lenders, a security interest in the
Collateral.
3.2 “Collateral”
shall mean:
(A) the
shares of stock, partnership interests, member interests or other equity
interests at any time and from time to time acquired by Debtor of any and all
entities now or hereafter existing, all or a portion of such stock or other
equity interests which are acquired by such entities at any time (such entities,
together with the existing issuers, being hereinafter referred to collectively
as the "Pledged Issuers" and individually as a "Pledged Issuer"), the
certificates representing such shares, partnership interests, member interests
or other interests all options and other rights, contractual or otherwise,
in
respect thereof and all dividends, distributions, cash, instruments, investment
property and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such shares,
partnership interests, member interests or other interests;
(B) all
additional shares of stock, partnership interests, member interests or other
equity interests from time to time acquired by Debtor, of any Pledged Issuer,
the certificates representing such additional shares, all options and other
rights, contractual or otherwise, in respect thereof and all dividends,
distributions, cash, instruments, investment property and other property from
time to time received, receivable or otherwise distributed in respect of or
in
exchange for any or all of such additional shares, interests or equity; and
(C) all
security entitlements of Debtor in, and all Proceeds of any and all of the
foregoing in each case, whether now owned or hereafter acquired by Debtor and
howsoever its interest therein may arise or appear (whether by ownership,
security interest, lien, claim or otherwise).
3.3 The
Collateral Agent is hereby specifically authorized, after the Maturity Date
(defined in the Notes) accelerated or otherwise, or after an Event of Default
(as defined herein) and the expiration of any applicable cure period, to
transfer any Collateral into the name of the Collateral Agent and to take any
and all action deemed advisable to the Collateral Agent to remove any transfer
restrictions affecting the Collateral.
3.4 Contemporaneously
or prior to the execution of this Agreement, Debtor shall deliver or cause
to be
delivered to the Collateral Agent (a) any and all certificates and other
instruments representing or evidencing the Collateral, together with all
Necessary Endorsements. The Debtor is contemporaneously with the execution
hereof, delivering to Collateral Agent, or has previously delivered to
Collateral Agent, a true and correct copy of each Organizational Documents
governing any of the Collateral and Subsidiaries. “Necessary Endorsement” means
undated stock powers endorsed in blank or other proper instruments of assignment
duly executed and such other instruments or documents as the Collateral Agent
may reasonably request. “Organizational Documents” means with respect to any
Debtor and Subsidiary, the documents by which such Debtor or Subsidiary was
organized (such as a certificate of incorporation, certificate of limited
partnership or articles of organization, and including, without limitation,
any
certificates of designation for preferred stock or other forms of preferred
equity) and which relate to the internal governance of such Debtor or Subsidiary
(such as bylaws, a partnership agreement or an operating, limited liability
or
members agreement).
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4. Perfection
of Security Interest.
4.1 Debtor
shall prepare, execute and deliver to the Collateral Agent UCC-1 Financing
Statements covering the Collateral. The Collateral Agent is instructed to
prepare and file at Debtor’s cost and expense, financing statements in such
jurisdictions deemed advisable to the Collateral Agent, including but not
limited to the State of Nevada. The Financing Statements are deemed to have
been
filed for the benefit of the Collateral Agent and Lenders identified on Schedule
A hereto.
4.2
All
other certificates and instruments constituting Collateral from time to time
required to be pledged to Collateral Agent pursuant to the terms hereof (the
"Additional Collateral") shall be delivered to Collateral Agent promptly upon
receipt thereof by or on behalf of Debtor. All such certificates and instruments
shall be held by or on behalf of Collateral Agent pursuant hereto and shall
be
delivered in suitable form for transfer by delivery, or shall be accompanied
by
duly executed instruments of transfer or assignment or undated stock powers
executed in blank, all in form and substance satisfactory to Collateral Agent.
If any Collateral consists of uncertificated securities, unless the immediately
following sentence is applicable thereto, Debtor shall cause Collateral Agent
(or its custodian, nominee or other designee) to become the registered holder
thereof, or cause each issuer of such securities to agree that it will comply
with instructions originated by Collateral Agent with respect to such securities
without further consent by Debtor. If any Collateral consists of security
entitlements, Debtor shall transfer such security entitlements to Collateral
Agent (or its custodian, nominee or other designee) or cause the applicable
securities intermediary to agree that it will comply with entitlement orders
by
Collateral Agent without further consent by Debtor.
4.3 Within
five (5) days after the receipt by Debtor of any Additional Collateral, a Pledge
Amendment, duly executed by Debtor, in substantially the form of Annex I hereto
(a "Pledge Amendment"), shall be delivered to Collateral Agent in respect of
the
Additional Collateral to be pledged pursuant to this Agreement. Debtor hereby
authorizes Collateral Agent to attach each Pledge Amendment to this Agreement
and agrees that all certificates or instruments listed on any Pledge Amendment
delivered to Collateral Agent shall for all purposes hereunder constitute
Collateral.
4.4 If
Debtor
shall receive, by virtue of Debtor being or having been an owner of any
Collateral, any (i) stock certificate (including, without limitation, any
certificate representing a stock dividend or distribution in connection with
any
increase or reduction of capital, reclassification, merger, consolidation,
sale
of assets, combination of shares, stock split, spin-off or split-off),
promissory note or other instrument, (ii) option or right, whether as an
addition to, substitution for, or in exchange for, any Collateral, or otherwise,
(iii) dividends payable in cash (except such dividends permitted to be retained
by Debtor pursuant to Section 5.2 hereof) or in securities or other property
or
(iv) dividends or other distributions in connection with a partial or total
liquidation or dissolution or in connection with a reduction of capital, capital
surplus or paid-in surplus, Debtor shall receive such stock certificate,
promissory note, instrument, option, right, payment or distribution in trust
for
the benefit of Collateral Agent, shall segregate it from Debtor's other property
and shall deliver it forthwith to Collateral Agent, in the exact form received,
with any necessary endorsement and/or appropriate stock powers duly executed
in
blank, to be held by Collateral Agent as Collateral and as further collateral
security for the Obligations.
5. Distribution
on Liquidation.
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5.1 If
any
sum is paid as a liquidating distribution on or with respect to the Collateral,
Debtor shall deliver same to the Collateral Agent to be applied to the
Obligations, then due, in accordance with the terms of the Convertible
Notes.
5.2 So
long
as no Event of Default exists, Debtor shall be entitled (i) to exercise all
voting power pertaining to any of the Collateral, provided such exercise is
not
contrary to the interests of the Lenders and does not impair the Collateral
and
(ii) may receive and retain any and all dividends, interest payments or other
distributions paid in respect of the Collateral.
5.3. Upon
the
occurrence and during the continuation of an Event of Default, all rights of
Debtor, upon notice given by Collateral Agent, to exercise the voting power
and
receive payments, which it would otherwise be entitled to pursuant to Section
5.2, shall cease and all such rights shall thereupon become vested in Collateral
Agent, which shall thereupon have the sole right to exercise such voting power
and receive such payments.
5.4 All
dividends, distributions, interest and other payments which are received by
Debtor contrary to the provisions of Section 5.3 shall be received in trust
for
the benefit of Collateral Agent, shall be segregated from other funds of Debtor,
and shall be forthwith paid over to Collateral Agent as Collateral in the exact
form received with any necessary endorsement and/or appropriate stock powers
duly executed in blank, to be held by Collateral Agent as Collateral and as
further collateral security for the Obligations.
6. Further
Action By Debtor; Covenants and Warranties.
6.1 Collateral
Agent at all times shall have a perfected security interest in the Collateral.
Debtor has and will continue to have full title to the Collateral free from
any
liens, leases, encumbrances, judgments or other claims. Collateral Agent's
security interest in the Collateral constitutes and will continue to constitute
a first, prior and indefeasible security interest in favor of Collateral Agent.
Debtor will do all acts and things, and will execute and file all instruments
(including, but not limited to, security agreements, financing statements,
continuation statements, etc.) reasonably requested by Collateral Agent to
establish, maintain and continue the perfected security interest of Collateral
Agent in the Collateral, and will promptly on demand, pay all costs and expenses
of filing and recording, including the costs of any searches reasonably deemed
necessary by Collateral Agent from time to time to establish and determine
the
validity and the continuing priority of the security interest of Collateral
Agent, and also pay all other claims and charges that, in the opinion of
Collateral Agent, exercised in good faith, are reasonably likely to materially
prejudice, imperil or otherwise affect the Collateral or Collateral Agent’s or
Lenders’ security interests therein.
6.2 Other
than in the ordinary course of business, and except for Collateral which is
substituted by assets of identical or greater value or which has become obsolete
or is of inconsequential in value, Debtor will not sell, transfer, assign or
pledge those items of Collateral (or allow any such items to be sold,
transferred, assigned or pledged), without the prior written consent of
Collateral Agent other than a transfer of the Collateral to a wholly-owned
subsidiary on prior notice to Collateral Agent, and provided the Collateral
remains subject to the security interest herein described. Although Proceeds
of
Collateral are covered by this Agreement, this shall not be construed to mean
that Collateral Agent consents to any sale of the Collateral, except as provided
herein. Sales of Collateral in the ordinary course of business shall be free
of
the security interest of Lenders and Collateral Agent and Lenders and Collateral
Agent shall promptly execute such documents (including without limitation
releases and termination statements) as may be required by Debtor to evidence
or
effectuate the same.
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6.3 Debtor
will, at all reasonable times and upon reasonable notice, allow Collateral
Agent
or its representatives free and complete access to the Collateral and all of
Debtor's records which in any way relate to the Collateral, for such inspection
and examination as Collateral Agent reasonably deems necessary.
6.4 Debtor,
at its sole cost and expense, will protect and defend this Security Agreement,
all of the rights of Collateral Agent and Lenders hereunder, and the Collateral
against the claims and demands of all other persons.
6.5 Debtor
will promptly notify Collateral Agent of any levy, distraint or other seizure
by
legal process or otherwise of any part of the Collateral, and of any threatened
or filed claims or proceedings that are reasonably likely to affect or impair
any of the rights of Collateral Agent under this Security Agreement in any
material respect.
6.6 Debtor,
at its own expense, will obtain and maintain in force insurance policies
covering losses or damage to those items of Collateral which constitute physical
personal property. The insurance policies to be obtained by Debtor shall be
in
form and amounts reasonably acceptable to Collateral Agent. Debtor shall make
the Collateral Agent first a loss payee thereon to the extent of its interest
in
the Collateral. Collateral Agent is hereby irrevocably (until the Obligations
are paid in full) appointed Debtor’ attorney-in-fact to endorse any check or
draft that may be payable to Debtor so that Collateral Agent may collect the
proceeds payable for any loss under such insurance. The proceeds of such
insurance (subject to the rights of senior secured parties), less any costs
and
expenses incurred or paid by Collateral Agent in the collection thereof, shall
be applied either toward the cost of the repair or replacement of the items
damaged or destroyed, or on account of any sums secured hereby, whether or
not
then due or payable.
6.7 Collateral
Agent may, at its option, and without any obligation to do so, pay, perform
and
discharge any and all amounts, costs, expenses and liabilities herein agreed
to
be paid or performed by Debtor. Upon
Debtor’s
failure
to do
so,
all
amounts expended by Collateral Agent in so doing shall become part of the
Obligations secured hereby, and shall be immediately due and payable by Debtor
to Collateral Agent upon demand and
shall
bear interest at the lesser of 15% per annum or the highest legal amount from
the dates of such expenditures until paid.
6.8 Upon
the
request of Collateral Agent, Debtor will furnish to Collateral Agent within
five
(5) business days thereafter, or to any proposed assignee of this Security
Agreement, a written statement in form reasonably satisfactory to Collateral
Agent, duly acknowledged, certifying the amount of the principal and interest
and any other sum then owing under the Obligations, whether to its knowledge
any
claims, offsets or defenses exist against the Obligations or against this
Security Agreement, or any of the terms and provisions of any other agreement
of
Debtor securing the Obligations. In connection with any assignment by Collateral
Agent of this Security Agreement, Debtor hereby agrees to cause the insurance
policies required hereby to be carried by Debtor, if any, to be endorsed in
form
satisfactory to Collateral Agent or to such assignee, with loss payable clauses
in favor of such assignee, and to cause such endorsements to be delivered to
Collateral Agent within ten (10) calendar days after request therefor by
Collateral Agent.
6.9 Debtor
will, at its own expense, make, execute, endorse, acknowledge, file and/or
deliver to the Collateral Agent from time to time such vouchers, invoices,
schedules, confirmatory assignments, conveyances, financing statements, transfer
endorsements, powers of attorney, certificates, reports and other reasonable
assurances or instruments and take further steps relating to the Collateral
and
other property or rights covered by the security interest hereby granted, as
the
Collateral Agent may reasonably require to perfect its security interest
hereunder.
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6.10 Debtor
represents and warrants that it is the true and lawful exclusive owner of the
Collateral, free and clear of any liens and encumbrances.
6.11 Debtor
hereby agrees not to divest itself of any right under the Collateral except
as
permitted herein absent prior written approval of the Collateral Agent, except
to a subsidiary organized and located in the United States on prior notice
to
Collateral Agent provided the Collateral remains subject to the security
interest herein described.
6.12 Debtor
shall cause each Subsidiary of Debtor not in existence on the date hereof to
execute and deliver to Collateral Agent promptly and in any event within 10
days
after the formation, acquisition or change in status thereof (A) a guaranty
guaranteeing the Obligations and (B) pledge agreement substantially in the
form
of this Agreement together with (x) certificates evidencing all of the capital
stock of any entity owned by such Subsidiary, (y) undated stock powers executed
in blank with signature guaranteed, and (z) such opinion of counsel and such
approving certificate of such Subsidiary as Collateral Agent may reasonably
request in respect of complying with any legend on any such certificate or
any
other matter relating to such shares and (E) such other agreements, instruments,
approvals, legal opinions or other documents reasonably requested by Collateral
Agent in order to create, perfect, establish the first priority of or otherwise
protect any lien purported to be covered by any such pledge agreement or
otherwise to effect the intent that all designated property of such Subsidiary
shall become Collateral for the Obligations. For purposes of this Agreement,
“Subsidiary”
means,
with respect to any entity at any date, any corporation, limited or general
partnership, limited liability company, trust, estate, association, joint
venture or other business entity) of which more than 50% of (A) the
outstanding capital stock having (in the absence of contingencies) ordinary
voting power to elect a majority of the board of directors or other managing
body of such entity, (B) in the case of a partnership or limited liability
company, the interest in the capital or profits of such partnership or limited
liability company or (C) in the case of a trust, estate, association, joint
venture or other entity, the beneficial interest in such trust, estate,
association or other entity business is, at the time of determination, owned
or
controlled directly or indirectly through one or more intermediaries, by such
entity.
7. Power
of Attorney.
After
the
occurrence and during the uncured continuation of an Event of Default, as
defined in Section 9 below, Debtor hereby irrevocably constitutes and appoints
the Collateral Agent as the true and lawful attorney of Debtor, with full power
of substitution, in the place and stead of Debtor and in the name of Debtor
or
otherwise, at any time or times, in the discretion of the Collateral Agent,
to
take any action and to execute any instrument or document which the Collateral
Agent may deem necessary or advisable to accomplish the purposes of this
Agreement. This power of attorney is coupled with an interest and is irrevocable
until the Obligations are satisfied.
8. Performance
By The Collateral Agent.
If
Debtor
fails to perform any material covenant, agreement, duty or obligation of Debtor
under this Agreement, the Collateral Agent may, after any applicable cure
period, at any time or times in its discretion, take action to effect
performance of such obligation. All reasonable expenses of the Collateral Agent
incurred in connection with the foregoing authorization shall be payable by
Debtor as provided in Paragraph 12.1 hereof. No discretionary right, remedy
or
power granted to the Collateral Agent under any part of this Agreement shall
be
deemed to impose any obligation whatsoever on the Collateral Agent with respect
thereto, such rights, remedies and powers being solely for the protection of
the
Collateral Agent.
9. Event
of Default.
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An
event
of default ("Event of Default") shall be deemed to have occurred hereunder
upon
the occurrence of any event of default as defined and described in this
Agreement, in the Notes, Subscription Agreement, and any other agreement to
which Debtor and a Lender are parties. Upon and after any Event of Default,
after the applicable cure period, if any, any or all of the Obligations shall
become immediately due and payable at the option of the Collateral Agent, for
the benefit of the Lenders, and the Collateral Agent may dispose of Collateral
as provided below. A default by Debtor of any of its material obligations
pursuant to this Agreement shall be an Event of Default hereunder and an event
of default as defined in the Notes, and Subscription Agreement.
10. Disposition
of Collateral.
Upon
and
after any Event of Default which is then continuing,
10.1 The
Collateral Agent may exercise its rights with respect to each and every
component of the Collateral, without regard to the existence of any other
security or source of payment for the Obligations. In addition to other rights
and remedies provided for herein or otherwise available to it, the Collateral
Agent shall have all of the rights and remedies of a lender on default under
the
Uniform Commercial Code then in effect in the State of New York.
10.2 In
the
event of any sale or other disposition of Collateral is to occur, the Collateral
Agent shall provide Debtor with at least five business (5) days prior written
notice (which Debtor agrees is reasonable notice within the meaning of Section
9.612(a) of the Uniform Commercial Code) of the time and place of any sale
of
Collateral which Debtor hereby agrees may be by private sale. The rights granted
in this Section are in addition to any and all rights available to Collateral
Agent under the Uniform Commercial Code.
10.3 The
Collateral Agent is authorized, at any such sale, if the Collateral Agent deems
it advisable to do so, in order to comply with any applicable securities laws,
to restrict the prospective bidders or purchasers to persons who will represent
and agree, among other things, that they are purchasing the Collateral for
their
own account for investment, and not with a view to the distribution or resale
thereof, or otherwise to restrict such sale in such other manner as the
Collateral Agent deems advisable to ensure such compliance. Sales made subject
to such restrictions shall be deemed to have been made in a commercially
reasonable manner.
10.4 All
proceeds received by the Collateral Agent for the benefit of the Lenders in
respect of any sale, collection or other enforcement or disposition of
Collateral, shall be applied (after deduction of any amounts payable to the
Collateral Agent pursuant to Paragraph 12.1 hereof) against the Obligations
pro
rata among the Lenders in proportion to their interests in the Obligations.
Upon
payment in full of all Obligations, Debtor shall be entitled to the return
of
all Collateral, including cash, which has not been used or applied toward the
payment of Obligations or used or applied to any and all costs or expenses
of
the Collateral Agent incurred in connection with the liquidation of the
Collateral (unless another person is legally entitled thereto). Any assignment
of Collateral by the Collateral Agent to Debtor shall be without representation
or warranty of any nature whatsoever and wholly without recourse. To the extent
allowed by law, each Lender may purchase the Collateral and pay for such
purchase by offsetting up to such Lender’s pro rata portion of the purchase
price with sums owed to such Lender by Debtor arising under the Obligations
or
any other source.
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11. Waiver
of Automatic Stay.
Debtor
acknowledges and agrees that should a proceeding under any bankruptcy or
insolvency law be commenced by or against Debtor, or if any of the Collateral
should become the subject of any bankruptcy or insolvency proceeding, then
the
Collateral Agent should be entitled to, among other relief to which the
Collateral Agent or Lenders may be entitled under the Note, Subscription
Agreement and any other agreement to which the Debtor, Lenders or Collateral
Agent are parties, (collectively "Loan Documents") and/or applicable law, an
order from the court granting immediate relief from the automatic stay pursuant
to 11 U.S.C. Section 362 to permit the Collateral Agent to exercise all of
its
rights and remedies pursuant to the Loan Documents and/or applicable law. Debtor
EXPRESSLY WAIVES THE BENEFIT OF THE AUTOMATIC STAY IMPOSED BY 11 U.S.C. SECTION
362. FURTHERMORE, Debtor EXPRESSLY ACKNOWLEDGES AND AGREES THAT NEITHER 11
U.S.C. SECTION 362 NOR ANY OTHER SECTION OF THE BANKRUPTCY CODE OR OTHER STATUTE
OR RULE (INCLUDING, WITHOUT LIMITATION, 11 U.S.C. SECTION 105) SHALL STAY,
INTERDICT, CONDITION, REDUCE OR INHIBIT IN ANY WAY THE ABILITY OF THE COLLATERAL
AGENT TO ENFORCE ANY OF ITS RIGHTS AND REMEDIES UNDER THE LOAN DOCUMENTS AND/OR
APPLICABLE LAW. Debtor hereby consents to any motion for relief from stay which
may be filed by the Collateral Agent in any bankruptcy or insolvency proceeding
initiated by or against Debtor, and further agrees not to file any opposition
to
any motion for relief from stay filed by the Collateral Agent. Debtor
represents, acknowledges and agrees that this provision is a specific and
material aspect of this Agreement, and that the Collateral Agent would not
agree
to the terms of this Agreement if this waiver were not a part of this Agreement.
Debtor further represents, acknowledges and agrees that this waiver is
knowingly, intelligently and voluntarily made, that neither the Collateral
Agent
nor any person acting on behalf of the Collateral Agent has made any
representations to induce this waiver, that Debtor has been represented (or
has
had the opportunity to be represented) in the signing of this Agreement and
in
the making of this waiver by independent legal counsel selected by Debtor and
that Debtor has had the opportunity to discuss this waiver with
counsel.
12. Miscellaneous.
12.1 Expenses.
Debtor
shall pay to the Collateral Agent, on demand, the amount of any and all
reasonable expenses, including, without limitation, attorneys' fees, legal
expenses and brokers' fees, which the Collateral Agent may incur in connection
with (a) sale, collection or other enforcement or disposition of Collateral;
(b)
exercise or enforcement of any the rights, remedies or powers of the Collateral
Agent hereunder or with respect to any or all of the Obligations upon breach
or
threatened breach; or (c) failure by Debtor to perform and observe any
agreements of Debtor contained herein which are performed by the Collateral
Agent.
12.2 Waivers,
Amendment and Remedies.
No
course of dealing by the Collateral Agent and no failure by the Collateral
Agent
to exercise, or delay by the Collateral Agent in exercising, any right, remedy
or power hereunder shall operate as a waiver thereof, and no single or partial
exercise thereof shall preclude any other or further exercise thereof or the
exercise of any other right, remedy or power of the Collateral Agent. No
amendment, modification or waiver of any provision of this Agreement and no
consent to any departure by Debtor therefrom, shall, in any event, be effective
unless contained in a writing signed by the Collateral Agent, and then such
waiver or consent shall be effective only in the specific instance and for
the
specific purpose for which given. The rights, remedies and powers of the
Collateral Agent, not only hereunder, but also under any instruments and
agreements evidencing or securing the Obligations and under applicable law
are
cumulative, and may be exercised by the Collateral Agent from time to time
in
such order as the Collateral Agent may elect.
12.3 Notices.
All
notices or other communications given or made hereunder shall be in writing
and
shall be personally delivered or deemed delivered the first business day after
being faxed (provided that a copy is delivered by first class mail) to the
party
to receive the same at its address set forth below or to such other address
as
either party shall hereafter give to the other by notice duly made under this
Section:
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To
Debtor:
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c/o
Sichenzia
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP
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▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
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Attn:
▇▇▇▇ ▇▇▇▇, Esq.
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Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
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To
Lenders:
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To
the addresses and telecopier numbers set forth
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on
Schedule A
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To
the Collateral Agent:
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇, Esq.
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▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
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Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
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With
an additional copy to:
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Grushko
& ▇▇▇▇▇▇▇, P.C.
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▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
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▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
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Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
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Any
party
may change its address by written notice in accordance with this paragraph
but
in the case of the Debtor only, to a domestic United States address and fax
number.
12.4 Term;
Binding Effect.
This
Agreement shall (a) remain in full force and effect until payment and
satisfaction in full of all of the Obligations; (b) be binding upon Debtor,
and
its successors and permitted assigns; and (c) inure to the benefit of the
Collateral Agent, for the benefit of the Lenders and their respective successors
and assigns. All the rights and benefits granted by Debtor to the Collateral
Agent and Lenders in the Loan Documents and other agreements and documents
delivered in connection therewith are deemed granted to both the Collateral
Agent and Lenders.
12.5 Captions.
The
captions of Paragraphs, Articles and Sections in this Agreement have been
included for convenience of reference only, and shall not define or limit the
provisions hereof and have no legal or other significance
whatsoever.
12.6 Governing
Law; Venue; Severability.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York without
regard to conflicts
of laws principles
that
would result in the application of the substantive laws of another
jurisdiction,
except
to the extent that the perfection of the security interest granted hereby in
respect of any item of Collateral may be governed by the law of another
jurisdiction. Any legal action or proceeding against Debtor with respect to
this
Agreement may be brought in the courts in the State of New York or of
the
United
States for the Southern District of New York, and, by execution and delivery
of
this Agreement, Debtor hereby irrevocably accepts for itself and in respect
of
its property, generally and unconditionally, the jurisdiction of the aforesaid
courts. Debtor hereby irrevocably waives any objection which they may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement brought in
the
aforesaid courts and hereby further irrevocably waives and agrees not to plead
or claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum. If any provision of this
Agreement, or the application thereof to any person or circumstance, is held
invalid, such invalidity shall not affect any other provisions which can be
given effect without the invalid provision or application, and to this end
the
provisions hereof shall be severable and the remaining, valid provisions shall
remain of full force and effect.
9
12.7 Entire
Agreement.
This
Agreement contains the entire agreement of the parties and supersedes all other
agreements and understandings, oral or written, with respect to the matters
contained herein.
12.8 Force
Majeure. Any
delay
in or failure of performance by the Company or Subscribers shall not constitute
a default or give rise to any claim hereunder if such default is exclusively
a
result of acts of G-d, war, riots, fire, sustained power failure, flood, strike,
lockout, epidemics and national defense requirements, provided the party
claiming excuse makes reasonable effort under the circumstances to comply with
its obligations.
12.9 Counterparts/Execution.
This
Agreement may be executed in any number of counterparts and by the different
signatories hereto on separate counterparts, each of which, when so executed,
shall be deemed an original, but all such counterparts shall constitute but
one
and the same instrument. This Agreement may be executed by facsimile signature
and delivered by facsimile transmission.
[THIS
SPACE INTENTIONALLY LEFT BLANK]
10
IN
WITNESS WHEREOF, the
undersigned have executed and delivered this Stock Pledge Agreement, as of
the
date first written above.
|
"DEBTOR"
|
"THE
COLLATERAL AGENT"
|
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
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|
a
Nevada corporation
|
||
|
By:
_____________________________________
|
_____________________________________
|
|
|
Its:
_____________________________________
|
||
|
APPROVED
BY “LENDERS”:
|
||
|
Name
of Lender (Print):
|
Name
of Lender (Print):
|
|
|
________________________________________
|
______________________________________
|
|
|
By:_____________________________________
|
By:____________________________________
|
|
|
Print
Name of Signator:_____________________
|
Print
Name of
Signator:____________________
|
|
This
Stock Pledge Agreement may be signed by facsimile signature
and
delivered
by confirmed facsimile transmission.
11
SCHEDULE
A TO STOCK PLEDGE AGREEMENT
|
LENDERS
|
PRINCIPAL
AMOUNT OF
NOTE
|
12
ANNEX
I
TO
PLEDGE
AMENDMENT
This
Pledge Amendment, dated _________ __ 200_, is delivered pursuant to Section
4.3
of the Stock Pledge Agreement referred to below. The undersigned hereby agrees
that this Pledge Amendment may be attached to the Stock Pledge Agreement, dated
March ___, 2007, as it may heretofore have been or hereafter may be amended,
restated, supplemented or otherwise modified from time to time and that the
shares listed on this Pledge Amendment shall be hereby pledged and assigned
to
Collateral Agent and become part of the Collateral referred to in such Stock
Pledge Agreement and shall secure all of the Obligations referred to in such
Stock Pledge Agreement.
|
Name
of Issuer
|
Number
of
Shares
|
Class
|
Certificate
Number(s)
|
By: _____________________________________
13