Exhibit 4.4
STOCK PLEDGE AGREEMENT
STOCK PLEDGE AGREEMENT, dated as of August 22, 2000, between
WORLDWIDE WEB NETWORX CORPORATION, a Delaware corporation ("Pledgor"), and XXXXX
VENTURES-FUND I, INC., a Delaware corporation ("Lender").
W I T N E S S E T H:
WHEREAS, Pledgor is the record and beneficial owner of the
shares of the common capital stock and other securities described in Schedule I
attached hereto (the "Pledged Securities"); and
WHEREAS, Lender has made a loan to Pledgor (the "Loan"),
evidenced by a Convertible Note dated of even date herewith (the "Note"), the
proceeds of which are to be used for working capital and other corporate
purposes of Borrower and its subsidiaries; and
WHEREAS, in connection with the making of the Loan and as
security for the repayment of the Loan, Lender is requiring that Pledgor execute
and deliver this Pledge Agreement and grant the security interest contemplated
hereby.
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained and to induce Lender to make the Loan, it is
agreed as follows:
1. Definitions. Unless otherwise defined herein, the following
terms shall have (unless otherwise provided elsewhere in this Stock Pledge
Agreement) the following respective meanings (such meanings being equally
applicable to both the singular and plural form of the terms defined):
"Agreement" shall mean this Stock Pledge Agreement, including
all amendments, modifications and supplements and any exhibits or schedules to
any of the foregoing, and shall refer to the Agreement as the same may be in
effect at the time such reference becomes operative.
"Bankruptcy Code" shall mean title 11, United States Code, as
amended from time to time, and any successor statute thereto.
"Pledged Collateral" shall have the meaning assigned to such
term in Section 2 hereof.
"Secured Obligations" shall have the meaning assigned to such
term in Section 3 hereof.
2. Pledge. Pledgor hereby grants to Lender a first priority
security interest in the Pledged Securities and the certificates representing
the Pledged Securities, and all dividends,
distributions, cash, instruments and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of the Pledged Securities (collectively, the "Pledged
Collateral").
3. Security for Obligations. This Agreement secures, and the
Pledged Collateral is security for, the prompt payment of the Loan, in full,
when due, whether at stated maturity, by acceleration or otherwise, and
performance of Pledgor's obligations under the Note, whether for principal,
interest, fees, costs and expenses, and all obligations of Pledgor now or
hereafter existing under this Agreement or the Security Agreement, dated of even
date herewith, between Pledgor, as debtor, and Lender, as secured party
(collectively, the "Secured Obligations").
4. Delivery of Pledged Collateral. All certificates
representing or evidencing the Pledged Securities shall be delivered to and held
by or on behalf of Lender pursuant hereto and shall be accompanied by duly
executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to Lender. Lender shall have the right, at any time after
the occurrence of an event of default under the Note or the Security Agreement
dated of even date herewith between Pledgor, as debtor, and Lender, as secured
party, which is not cured within the notice and grace periods provided for
therein (an "Event of Default"), in its discretion and without notice to
Pledgor, to transfer to or to register in the name of Lender or any of its
nominees any or all of the Pledged Securities. In addition, Lender shall have
the right at any time to exchange certificates or instruments representing or
evidencing Pledged Securities for certificates or instruments of smaller or
larger denominations.
5. Representations and Warranties. Pledgor represents and
warrants to Lender that:
(a) Pledgor is, and at the time of delivery of the Pledged
Securities to Lender pursuant to Section 4 hereof will be, the sole holder of
record and the sole beneficial owner of the Pledged Collateral free and clear of
any lien thereon or affecting the title thereto, except for the lien created by
this Agreement.
(b) All of the Pledged Securities are fully paid and
non-assessable.
(c) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes a legal, valid and binding obligation of
Pledgor enforceable in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency, or other similar laws affecting the rights
of creditors generally or by the application of general equity principles.
The representations and warranties set forth in this Section 5
shall survive the execution and delivery of this Agreement.
6. Covenants. Pledgor covenants and agrees that:
(a) Without the prior written consent of Lender, Pledgor will
not sell, assign, transfer, pledge, or otherwise encumber any of its rights in
or to the Pledged Collateral or any
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unpaid dividends or other distributions or payments with respect thereto or
xxxxx x xxxx in any therein; provided, however, that Pledgor may sell all or any
part of the Pledged Collateral, at any time, provided that the proceeds are used
to pay the obligations secured hereby in full.
(b) Pledgor will, at its expense, promptly execute,
acknowledge and deliver all such instruments and take all such action as Lender
from time to time may request in order to ensure to Lender the benefits of the
liens in and to the Pledged Collateral intended to be created by this Agreement,
including the filing of any necessary Uniform Commercial Code financing
statements, and will cooperate with Lender, at Pledgor's expense, in obtaining
all necessary approvals and making all necessary filings under federal or state
law in connection with such liens or any sale or transfer of the Pledged
Collateral.
(c) Pledgor has and will defend the title to the Pledged
Collateral against the claim of any party.
7. Pledgor's Rights. As long as no Event of Default shall have
occurred and be continuing and until written notice shall be given to Pledgor in
accordance with Section 8(a) hereof,
(a) Pledgor shall have the right, from time to time, to vote
and give consents with respect to the Pledged Collateral or any part thereof for
all purposes not inconsistent with the provisions of this Agreement;
(b) All dividends and all other distributions in respect of
any of the Pledged Securities of Pledgor, whenever paid or made, shall be
delivered to Lender to hold as Pledged Collateral and shall, if received by
Pledgor, be received in trust for the benefit of Lender, be segregated from the
other property or funds of Pledgor, and be forthwith delivered to Lender as
Pledged Collateral in the same form as so received (with any necessary
endorsement).
8. Defaults and Remedies. (a) Upon the occurrence of an Event
of Default and during the continuation of such Event of Default, then or at any
time after such declaration (provided that such declaration is not rescinded by
the Lender) and following written notice to Pledgor, Lender (personally or
through an agent) is hereby authorized and empowered to transfer and register in
its name or in the name of its nominee the whole or any part of the Pledged
Collateral, to exchange certificates or instruments representing or evidencing
Pledged Securities for certificates or instruments of smaller or larger
denominations, to exercise the voting rights with respect thereto, to sell in
one or more sales after ten (10) days' notice of the time and place of any
public sale or of the time after which a private sale is to take place (which
notice Pledgor agrees is commercially reasonable), but without any previous
notice or advertisement, the whole or any part of the Pledged Collateral and to
otherwise act with respect to the Pledged Collateral as though Lender was the
outright owner thereof, Pledgor hereby irrevocably constituting and appointing
Lender as the proxy and attorney-in-fact of Pledgor, with full power of
substitution to do so, and which shall remain in effect until the Secured
Obligations are paid in full; provided, however, Lender shall not have any duty
to exercise any such right or to preserve the same and shall not be liable for
any failure to do so or for any delay in doing so. Any sale shall be made at
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a public or private sale at Lender's place of business, or at any public
building in the City of New York or elsewhere to be named in the notice of sale,
either for cash or upon credit or for future delivery at such price as Lender
may deem fair, and Lender or any Lender may be the purchaser of the whole or any
part of the Pledged Collateral so sold and hold the same thereafter in its own
right free from any claim of Pledgor or any right of redemption. Each sale shall
be made to the highest bidder, but Lender reserves the right to reject any and
all bids at such sale which, in its discretion, it shall deem inadequate.
Demands of performance, except as otherwise herein specifically provided for,
notices of sale, advertisements and the presence of property at sale are hereby
waived and any sale hereunder may be conducted by an auctioneer or any officer
or agent of Lender.
(b) If, at the original time or times appointed for the sale
of the whole or any part of the Pledged Collateral, the highest bid, if there be
but one sale, shall be inadequate to discharge in full all the Secured
Obligations, or if the Pledged Collateral be offered for sale in lots, if at any
of such sales, the highest bid for the lot offered for sale would indicate to
Lender, in its discretion, the unlikelihood of the proceeds of the sales of the
whole of the Pledged Collateral being sufficient to discharge all the Secured
Obligations, Lender may, on one or more occasions and in its discretion,
postpone any of said sales by public announcement at the time of sale or the
time of previous postponement of sale, and no other notice of such postponement
or postponements of sale need be given, any other notice being hereby waived;
provided, however, that any sale or sales made after such postponement shall be
after ten (10) days' notice to Pledgor.
(c) In the event of any sales hereunder Lender shall, after
deducting all costs or expenses of every kind (including reasonable attorneys'
fees and disbursements) for care, safekeeping, collection, sale, delivery or
otherwise, apply the residue of the proceeds of the sales to the payment or
reduction, either in whole or in part, of the Secured Obligations, returning the
surplus, if any, to Pledgor.
(d) If, at any time when Lender shall determine to exercise
its right to sell the whole or any part of the Pledged Collateral hereunder,
such Pledged Collateral or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under the Securities Act of 1933, as
amended (or any similar statute then in effect) (the "Act"), Lender may, in its
discretion (subject only to applicable requirements of law), sell such Pledged
Collateral or part thereof by private sale in such manner and under such
circumstances as Lender may deem necessary or advisable, but subject to the
other requirements of this Section 8, and shall not be required to effect such
registration or to cause the same to be effected. Without limiting the
generality of the foregoing, in any such event Lender in its discretion (x) may,
in accordance with applicable securities laws, proceed to make such private sale
notwithstanding that a registration statement for the purpose of registering
such Pledged Collateral or part thereof could be or shall have been filed under
said Act (or similar statute), (y) may approach and negotiate with a single
possible purchaser to effect such sale, and (z) may restrict such sale to a
purchaser who will represent and agree that such purchaser is purchasing for its
own account, for investment and not with a view to the distribution or sale of
such Pledged Collateral or part thereof. In addition to a private sale as
provided above in this Section 8, if any of the Pledged
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Collateral shall not be freely distributable to the public without registration
under the Act (or similar statute) at the time of any proposed sale pursuant to
this Section 8, then Lender, in its discretion (subject only to applicable
requirements of law), may require that any sale hereunder (including a sale at
auction) be conducted subject to restrictions (i) as to the financial
sophistication and ability of any Person permitted to bid or purchase at any
such sale, (ii) as to the content of legends to be placed upon any certificates
representing the Pledged Collateral sold in such sale, including restrictions on
future transfer thereof, (iii) as to the representations required to be made by
each Person bidding or purchasing at such sale relating to that Person's access
to financial information about Pledgor and such party's intentions as to the
holding of the Pledged Collateral so sold for investment, for its own account,
and not with a view to the distribution thereof, and (iv) as to such other
matters as Lender may, in its discretion, deem necessary or appropriate in order
that such sale (notwithstanding any failure so to register) may be effected in
compliance with the Bankruptcy Code and other laws affecting the enforcement of
creditors' rights and the Act and all applicable state securities laws.
(e) Pledgor recognizes that Lender may be unable to effect a
public sale of any or all the Pledged Collateral and may be compelled to resort
to one or more private sales thereof. Pledgor also acknowledges that any such
private sale may result in prices and other terms less favorable to the seller
than if such sale were a public sale and, notwithstanding such circumstances,
agrees that any such private sale shall be deemed to have been made in a
commercially reasonable manner.
(f) Pledgor agrees that following the occurrence and during
the continuance of an Event of Default it will not at any time plead, claim or
take the benefit of any appraisal, valuation, stay, extension, moratorium or
redemption law now or hereafter in force in order to prevent or delay the
enforcement of this Agreement, or the absolute sale of the whole or any part of
the Pledged Collateral or the possession thereof by any purchaser at any sale
hereunder, and Pledgor waives the benefit of all such laws to the extent it
lawfully may do so. Pledgor agrees that it will not interfere with any right,
power and remedy of Lender provided for in this Agreement or now or hereafter
existing at law or in equity or by statute or otherwise, or the exercise or
beginning of the exercise by Lender of any one or more of such rights, powers or
remedies. No failure or delay on the part of Lender to exercise any such right,
power or remedy and no notice or demand which may be given to or made upon
Pledgor by Lender with respect to any such remedies shall operate as a waiver
thereof, or limit or impair Lender's right to take any action or to exercise any
power or remedy hereunder, without notice or demand, or prejudice its rights as
against Pledgor in any respect.
(g) Pledgor further agrees that a breach of any of the
covenants contained in this Section 8 will cause irreparable injury to Lender,
that Lender has no adequate remedy at law in respect of such breach and, as a
consequence, agrees that each and every covenant contained in this Section 8
shall be specifically enforceable against Pledgor, and Pledgor hereby waives and
agrees not to assert any defenses against an action for specific performance of
such covenants except for a defense that the Secured Obligations are not then
due and payable in accordance with the agreements and instruments governing and
evidencing such obligations. Pledgor further acknowledges the impossibility of
ascertaining the amount of damages which would be suffered
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by Lender by reason of a breach of any of such covenants and, consequently,
agrees that, if Lender shall xxx for damages for breach, it shall pay, as
liquidated damages and not as a penalty, an amount equal to the lesser of (i)
the value of the Pledged Collateral pledged by Pledgor on the date Lender shall
demand compliance with this Section 8, and (ii) the amount required to pay in
full the Secured Obligations.
9. Application of Proceeds. Any cash held by Lender as Pledged
Collateral and all cash proceeds received by Lender in respect of any sale of,
liquidation of, or other realization upon all or any part of the Pledged
Collateral shall be applied first to pay in full the expenses of Lender in
connection with such sale, disposition or other realization, including all
expenses, liabilities and advances incurred or made by Lender in connection
therewith, including, without limitation, attorney's fees, and then to the then
unpaid principal of and accrued interest due under the Note.
10. Waiver. No delay on Lender's part in exercising any power
of sale, lien, option or other right here-under, and no notice or demand which
may be given to or made upon Pledgor by Lender with respect to any power of
sale, lien, option or other right hereunder, shall constitute a waiver thereof,
or limit or impair Lender's right to take any action or to exercise any power of
sale, lien, option, or any other right hereunder, without notice or demand, or
prejudice Lender's rights as against Pledgor in any respect.
11. Assignment. Lender may assign, indorse or transfer any
instrument evidencing all or any part of the Secured Obligations and the holder
of such instrument shall be entitled to the benefits of this Agreement.
12. Termination. Immediately following the payment of all
Secured Obligations, Lender shall deliver to Pledgor the Pledged Collateral at
the time subject to this Agreement and all instruments of assignment executed in
connection therewith, free and clear of the liens hereof and, except as
otherwise provided herein, all of Pledgor's obligations hereunder shall at such
time terminate.
13. Lien Absolute. All rights of Lender hereunder, and all
obligations of Pledgor hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any agreement or
instrument governing or evidencing any Secured Obligations;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any part of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from any other agreement
or instrument governing or evidencing any Secured Obligations;
(c) any exchange, release or non-perfection of any other
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty, for all or any of the Secured Obligations; or
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(d) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, Pledgor.
14. Release. Pledgor consents and agrees that Lender may at
any time, or from time to time, in their discretion (a) renew, extend or change
the time of payment, and/or the manner, place or terms of payment of all or any
part of the Secured Obligations and (b) exchange, release and/or surrender all
or any of the Pledged Collateral, or any part thereof, by whomsoever deposited,
which is now or may hereafter be held by Lender in connection with all or any of
the Secured Obligations; all in such manner and upon such terms as Lender may
deem proper, and without notice to or further assent from Pledgor, it being
hereby agreed that Pledgor shall be and remain bound upon this Agreement,
irrespective of the existence, value or condition of any of the Pledged
Collateral, and notwithstanding any such change, exchange, settlement,
compromise, surrender, release, renewal or extension, and notwithstanding also
that the Secured Obligations may, at any time, exceed the aggregate principal
amount thereof set forth in the Loan Agreement, or any other agreement governing
any Secured Obligations. Pledgor hereby waives notice of acceptance of this
Agreement, and also presentment, demand, protest and notice of dishonor of any
and all of the Secured Obligations, and promptness in commencing suit against
any party hereto or liable hereon, and in giving any notice to or of making any
claim or demand hereunder upon Pledgor. No act or omission of any kind on
Lender's part shall in any event affect or impair this Agreement.
15. Indemnification. Pledgor jointly and severally agrees to
indemnify and hold Lender harmless from and against any taxes, liabilities,
claims and damages, including reasonable attorney's fees and disbursements, and
other expenses incurred or arising by reason of the taking or the failure to
take action by Lender, in good faith, in respect of any transaction effected
under this Agreement or in connection with the lien provided for herein,
including, without limitation, any taxes payable in connection with the delivery
or registration of any of the Pledged Collateral as provided herein. Whether or
not the transactions contemplated by this Agreement shall be consummated,
Pledgor agrees to pay to Lender all out-of-pocket costs and expenses incurred in
connection with this Agreement and all reasonable fees, expenses and
disbursements, including the reasonable fees of Lender's agents or
representatives, incurred in connection with the execution and delivery of this
Agreement and the performance by Lender of the provisions of this Agreement and
of any transactions effected in connection with this Agreement. The obligations
of Pledgor under this Section 15 shall survive the termination of this
Agreement.
16. Reinstatement. This Agreement shall remain in full force
and effect and continue to be effective should any petition be filed by or
against Pledgor for liquidation or reorganization, should Pledgor become
insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of Pledgor's
assets, and shall continue to be effective or be reinstated, as the case may be,
if at any time payment and performance of the Secured Obligations, or any part
thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must
otherwise be restored or returned by any obligee of the Secured Obligations,
whether as a "voidable preference", "fraudulent conveyance",
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or otherwise, all as though such payment or performance had not been made. In
the event that any payment, or any part thereof, is rescinded, reduced, restored
or returned, the Secured Obligations shall be reinstated and deemed reduced only
by such amount paid and not so rescinded, reduced, restored or returned.
17. Miscellaneous. (a) Pledgor jointly and severally agrees to
promptly reimburse Lender for actual out-of-pocket expenses, including, without
limitation, reasonable counsel fees, incurred by Lender in connection with the
administration and enforcement of this Agreement.
(b) Neither Lender nor any of its officers, directors,
employees, agents or counsel shall be liable for any action lawfully taken or
omitted to be taken by it or them hereunder or in connection herewith, except
for its or their own gross negligence or willful misconduct.
(c) This Agreement shall be binding upon Pledgor and is
successors and assigns, and shall inure to the benefit of, and be enforceable
by, Lender and its successors and assigns, and shall be governed by, and
construed and enforced in accordance with, the internal laws in effect in the
State of New York without giving effect to principles of conflict of laws, and
none of the terms or provisions of this Agreement may be waived, altered,
modified or amended except in writing duly signed for and on behalf of Lender
and Pledgor.
18. Severability. If for any reason any provision or
provisions hereof are determined to be invalid and contrary to any existing or
future law, such invalidity shall not impair the operation of or effect those
portions of this Agreement which are valid.
19. Notices. Except as otherwise provided here-in, whenever it
is provided herein that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties by any other party, or whenever any of the parties desires to
give or serve upon any other a communication with respect to this Agreement,
each such notice, demand, request, consent, approval, declaration or other
communication shall be in writing and either shall be delivered in person with
receipt acknowledged or sent by registered or certified mail, return receipt
requested, postage prepaid, or by telecopy and confirmed by telecopy answerback
addressed as follows:
(a) If to Lender, at:
Xxxxx Ventures-Fund I, Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: President
Telecopy Number: 000-000-0000
(b) If to Pledgor, at:
000 Xxxxxxxxxx Xxxx
8
Suite 130
Mt. Laurel, NJ 08054
Attention: President
or at such other address as may be substituted by notice given as herein
provided. The giving of any notice required hereunder may be waived in writing
by the party entitled to receive such notice. Every notice, demand, request,
con-sent, approval, declaration or other communication hereunder shall be deemed
to have been duly given or served on the date on which personally delivered,
with receipt acknowledged, telecopied and confirmed by telecopy answerback or
three (3) Business Days after the same shall have been deposited in the United
States mail. Failure or delay in delivering copies of any notice, demand,
request, consent, approval, declaration or other communication to the persons
designated above to receive copies shall in no way adversely affect the
effectiveness of such notice, demand, request, consent, approval, declaration or
other communication.
20. Section Titles. The Section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
21. Counterparts. This Agreement may be executed in any number
of counterparts, which shall, collectively and separately, constitute one
agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Stock
Pledge Agreement to be duly executed as of the date first written above.
WORLDWIDE WEB NETWORX CORPORATION
By: /s/ Xxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
Accepted and Acknowledged by:
XXXXX VENTURES-FUND I, INC.
As Lender
By: /s/ J. Xxxxxx Xxxxx
-----------------------------------
Name: J. Xxxxxx Xxxxx
Title:
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SCHEDULE I
This Schedule is attached to and forms a part of that certain Stock Pledge
Agreement, dated as of August 22, 2000, by WorldWide Web NetworX Corporation, as
Pledgor, to Xxxxx Ventures-Fund I, Inc., as Lender.
Pledged Securities:
104,000 shares of Series A Convertible Preferred Stock of VideoNet Corp.;
100 shares of the common capital stock of The Intrac Group, Ltd. (representing
100% of the issued and outstanding capital stock of the corporation);
80 shares of the common capital stock of Real Quest, Inc.
(representing 80% of the issued and outstanding capital stock of the
corporation);
1,040 shares of the common capital stock of ATM Service, Ltd.
(representing 52% of the issued and outstanding capital stock of the
corporation);
600,000 shares of the class B common capital stock of XxxxxXxxxx.xxx, Inc.
(representing approximately 1.1% of the issued and outstanding capital stock of
the corporation, on a fully-diluted basis);
1,661,090 shares of the common capital stock of One World Networks Integrated
Technologies, Inc. (representing approximately 2.5% of the issued and
outstanding capital stock of the corporation, on a fully-diluted basis);
Uncertificated membership interest in WWWX-Jencom, LLC (representing a 50%
interest in this limited liability company); and
Uncertificated membership interest in InterCommerce China, LLC (representing a
33.33% interest in this limited liability company).
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