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Exhibit 2
STOCK PLEDGE AGREEMENT, dated as of August 7, 2000, by and
among Gold & Xxxxx Transfer, S.A., a corporation organized and existing under
the laws of the British Virgin Islands ("Gold & Xxxxx"), Revision LLC, a limited
liability company organized under the laws of the State of Delaware
("Revision"), Foundation for the International Non-governmental Development of
Space ("FINDS") and Xxxxxx X. Xxxxxxxx, an individual ("Xxxxxxxx") (each of Gold
& Xxxxx, Revision, FINDS and Xxxxxxxx individually, a "Pledgor," and
collectively, the "Pledgors"), and Xxxxxx X. Xxxxx, an individual (the
"Pledgee").
R E C I T A L S
A. Pursuant to the Note, the Pledgee has agreed to loan to Gold &
Xxxxx, Revision and Xxxxxxxx (the "Borrowers") the aggregate principal amount of
$13 million.
B. It is a condition to the obligation of the Pledgee to make such loan
that Pledgors pledge the Shares of the Issuer owned by them to the Pledgee as
security for the performance of the obligations of the Borrowers under the Note.
C. Gold & Xxxxx, Revision and FINDS are stockholders of the Issuer and
are the legal and beneficial owners of 2,454,661 shares of common stock of the
Issuer which they are willing to pledge as security for the performance of the
obligations of the Borrowers under the Note, subject to and in accordance with
the terms and conditions set forth herein.
NOW, THEREFORE, to induce the Pledgee to make the loan
pursuant to the Note, and for other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, Pledgors hereby agree with the
Pledgee as follows:
SECTION 1. CERTAIN DEFINITIONS.
The following capitalized terms are used herein with the respective
meanings set forth below.
ADDITIONAL INITIAL SHARES: 1,179,732 Shares owned of record and
beneficially by one or more of the Pledgors, as more specifically set forth on
Exhibit A attached hereto.
CAPITAL STOCK: the Shares and all other capital stock or other equity
securities of any class of the Issuer.
COLLATERAL: the meaning given in the first paragraph of Section 3.
DEFAULT: shall have the meaning ascribed to such term in the Note.
DEMANDED SHARES: the meaning given in Section 7.3.
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EVENT OF DEFAULT: shall have the meaning ascribed to such term in the
Note.
INITIAL PLEDGED SHARES: a total of 1,751,172 Shares, owned of record
and beneficially by one or more of the Pledgors, as more specifically set forth
on Exhibit A attached hereto.
INITIAL RELEASE SHARES: a total of 571,400 Shares, owned of record and
beneficially by one or more of the Pledgors, as more specifically set forth on
Exhibit A attached hereto.
ISSUER: Total-Tel USA Communications, Inc., a New Jersey corporation.
LIEN: shall have the meaning ascribed to such term in the Note.
MARKET PRICE: at any point in time, the last reported sale price of the
shares of common stock of the Issuer on The Nasdaq Stock Market on the preceding
business day or, if there were no reported sales of such shares on The Nasdaq
Stock Market on the immediately preceding business day, on the most recent
business day on which there were such sales.
NOTE: the Note, dated of even date herewith, entered into by each
Pledgor, jointly and severally, in favor of Pledgee.
PERSON: natural persons, corporations, limited partnerships, general
partnerships, joint stock companies, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments and agencies and
political subdivisions thereof.
PLEDGED STOCK: the Shares and all other securities constituting part of
the Collateral and any securities issued or issuable with respect to the Pledged
Stock by way of dividend, stock split, conversion, exchange, in a merger,
recapitalization, consolidation, contribution or otherwise.
SECURED OBLIGATIONS: the meaning given in Section 2.
SECURITIES ACT: the meaning given in Section 6.7.
SHARES: 2,454,661 shares of common stock of the Issuer, par value $0.05
per share, owned of record and beneficially by one or more of the Pledgors, as
more specifically identified on Exhibit A attached hereto.
UCC: the Uniform Commercial Code of the State of New York.
SECTION 2. SECURITY FOR OBLIGATIONS.
This Agreement is entered into:
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(a) to secure the full and timely payment by Pledgors of (i)
all amounts the payment of which is required by Pledgors under the
Note, including, without limitation, the principal of and interest on
the Note (including, without limitation, interest accruing after the
date of any filing by any Pledgor of any petition in bankruptcy or the
commencement of any bankruptcy, insolvency or similar proceeding with
respect to any Pledgor) as and when the same become due and payable in
accordance with the terms thereof, whether at maturity or by
prepayment, acceleration, declaration of default or otherwise, and (ii)
all other indebtedness and other amounts payable by the Pledgors
hereunder or under the Note, and
(b) to secure the due and punctual performance by Pledgors of
(i) all obligations of the Pledgors under the Note and (ii) all other
obligations of Pledgors hereunder.
(all of the payment and performance obligations referred to in this Section 2
being referred to collectively as the "Secured Obligations").
SECTION 3. PLEDGE OF SHARES, ETC.
As security for the prompt payment and performance of the Secured
Obligations when due (whether at stated maturity, by acceleration or otherwise),
Pledgors hereby convey, assign, grant, hypothecate, mortgage, pledge, transfer
and deliver to the Pledgee a lien and charge upon, and a security interest in,
all the following property, whether now owned or hereafter acquired and whether
now or in the future existing and wherever located (collectively, the
"Collateral"):
(a) the Shares;
(b) all dividends, instruments, cash and other property or
rights of any kind at any time received, receivable or otherwise
distributed or distributable with respect to any of the foregoing;
(c) all certificates or other writings representing or
evidencing any of the foregoing;
(d) all proceeds of any of the property described in clauses
(a) through (C) above; and
(e) all books, correspondence, credit files, electronic data,
records, invoices and other papers and documents relating to any of the
foregoing.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
Each Pledgor represents and warrants to the Pledgee as
follows:
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(a) With respect to each of the Shares, including, without
limitation, each of the Initial Pledged Shares, Additional Initial
Shares and Demanded Shares, Gold & Xxxxx or Revision or FINDS is the
record and beneficial owner of such Shares, free and clear of any Lien
except for the Lien created by this Agreement. No effective financing
statement or other instrument of similar effect covering all or any
part of the Collateral is on file in any recording office, except such
as may have been filed in favor of the Pledgee relating to this
Agreement.
(b) The Shares have been duly and validly issued and are fully
paid and nonassessable.
(c) Upon delivery to the Pledgee of the certificates
evidencing the Initial Pledged Shares, the Additional Initial Shares
and the Demanded Shares, the security interest granted pursuant to this
Agreement will constitute a valid perfected first priority security
interest in such Shares, enforceable as such against all creditors of
each Pledgor and any Persons purporting to purchase any of such Shares
from any Pledgor.
(d) Gold & Xxxxx is a corporation duly organized, validly
existing and in good standing under the laws of the British Virgin
Islands and has all requisite corporate power and authority to enter
into and carry out the terms of this Agreement. Revision is a limited
liability company duly organized, validly existing and in good standing
under the laws of the State of Delaware and has all requisite limited
liability company power and authority to enter into and carry out the
terms of this Agreement and the Note. FINDS is a not-for-profit
corporation duly organized, validly existing and in good standing under
the laws of Delaware and has all requisite corporate power and
authority to enter into and carry out the terms of this Agreement.
(e) The execution, delivery and performance of this Agreement
and the Note will not result in any violation of or be in conflict with
or constitute a default under any term of any Pledgor's certificate of
incorporation or by-laws (or similar constitutive documents) or any
agreement or instrument to which any Pledgor is a party or by which any
Pledgor is bound or any term of any applicable law, ordinance, rule or
regulation of any governmental authority or any term of any applicable
order, judgment or decree of any court, arbitrator or governmental
authority.
(f) No consent, approval or authorization of, or declaration
or filing with, any governmental authority or regulatory body is
required for the valid execution, delivery and performance of this
Agreement and the Note.
(g) This Agreement and the Note have been duly authorized,
executed and delivered by each Pledgor and constitute each Pledgor's
legal, valid and binding obligation, enforceable against such Pledgor
in accordance with its terms, except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws of general
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application relating to or affecting the rights and remedies of
creditors, and by general equitable principles.
SECTION 5. VOTING RIGHTS, DIVIDENDS AND OTHER DISTRIBUTIONS, ETC.
5.1 Prior to Default or Event of Default. So long as no Default or
Event of Default has occurred and is continuing, Pledgors will remain entitled
to exercise any and all voting and other consensual rights pertaining to the
Pledged Stock and to receive and use cash dividends, in either case for any
purpose not inconsistent with the terms of this Agreement or the Note.
5.2 After Default or Event of Default. For so long as a Default or an
Event of Default is continuing, (i) no Pledgor may exercise any voting or other
consensual rights without the prior written consent of the Pledgee, (ii) the
right, if any, of any Pledgor to receive cash dividends in respect of the
Pledged Stock will cease and all such dividends must be paid directly to the
Pledgee (or if received by any Pledgor will be deemed held in trust by such
Pledgor for the benefit of, and must be turned over immediately by such Pledgor
to, the Pledgee) and thereafter will be held and disposed of by the Pledgee as
part of the Collateral, and (iii) if the Pledgee has notified the Pledgors that
it elects to exercise the Pledgee's right to exercise voting and other
consensual rights hereunder, all rights of each Pledgor to exercise the voting
and other consensual rights which such Pledgor would otherwise be entitled to
exercise pursuant to Section 5.1 will cease, all such rights will thereupon
become vested in the Pledgee, who during the continuance of such Default or
Event of Default will have (directly or through its nominee) the sole right to
exercise such voting and other consensual rights, including, without limitation,
(A) all voting, corporate and other rights pertaining to any of the Pledged
Stock, (B) all rights to give consents, waivers and ratifications in respect
thereof and (C) any and all rights of conversion, exchange, subscription and any
other rights, privileges or options pertaining to any of the Pledged Stock as if
it were the absolute owner thereof, and in connection therewith, the right to
deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such terms
and conditions as it may determine, all without liability except to account for
property actually received by it (each Pledgor hereby irrevocably constituting
and appointing the Pledgee the proxy and attorney-in-fact of such Pledgor, with
full power of substitution, to do or take any of the above actions). The Pledgee
will have no duty to Pledgors to exercise any such right, privilege or option
and will not be responsible for any failure to do so or delay in so doing. In
order to permit the Pledgee to exercise the voting and other consensual rights
which it may be entitled to exercise pursuant to this Section 5.2, and to
receive all dividends and distributions which it may be entitled to receive
under this Section 5.2, each Pledgor will, upon written notice from the Pledgee,
from time to time execute and deliver to the Pledgee appropriate proxies,
dividend payment orders and other instruments as the Pledgee may reasonably
request.
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SECTION 6. COVENANTS OF PLEDGORS.
6.1 Sale of Collateral, Etc. No Pledgor will (i) sell, assign,
transfer, convey, or otherwise dispose of, or grant any option with respect to,
any of the Collateral, or (ii) create or permit to exist any Lien upon or with
respect to any of the Collateral, except for the lien and security interest
created by this Agreement.
6.2 Delivery of Stock Certificates, Etc. (a) The Pledgors will
immediately deliver to the Pledgee all certificates or other writings
representing or evidencing any of the Initial Pledged Shares and any other
"securities" or "instruments" (as such terms are defined in the UCC) included in
the Collateral at any time acquired or received by any Pledgor, directly or
indirectly, either in suitable form for transfer by delivery, or issued in the
name of a Pledgor and accompanied by stock powers or other appropriate
instruments of transfer or assignment, duly executed by the relevant Pledgor in
blank and undated, and in either case having attached thereto all requisite
federal or state stock transfer tax stamps, all in form and substance
satisfactory to the Pledgee.
(b) Within 10 business days after the date hereof, the Pledgors will
deliver to the Pledgee all certificates or other writings representing or
evidencing the Additional Initial Shares, either in suitable form for transfer
by delivery, or issued in the name of a Pledgor and accompanied by stock powers
or other appropriate instruments of transfer or assignment, duly executed by the
relevant Pledgor in blank and undated, and in either case having attached
thereto all requisite federal or state stock transfer tax stamps, all in form
and substance satisfactory to the Pledgee. Upon delivery of the Additional
Initial Shares in accordance with the requirements of the immediately preceding
sentence, the Pledgee will return to the Pledgors the Initial Release Shares, so
long as, at the time of such delivery of the Additional Initial Shares, the
product of (i) the sum of the number of Initial Pledged Shares and the number of
Additional Initial Shares, less the number of Initial Release Shares, and (ii)
the Market Price as of such date, is equal to or in excess of $13,000,000.
(c) Within 10 business days after the date of a demand by the Pledgee
for Demanded Shares, the Pledgors will deliver to the Pledgee all certificates
or other writings representing or evidencing such Demanded Shares, either in
suitable form for transfer by delivery, or issued in the name of a Pledgor and
accompanied by stock powers or other appropriate instruments of transfer or
assignment, duly executed by the relevant Pledgor in blank and undated, and in
either case having attached thereto all requisite federal or state stock
transfer tax stamps, all in form and substance satisfactory to the Pledgee.
6.3 Other Distributions. Except for cash dividends permitted to be paid
to Pledgors pursuant to Section 5.1, Pledgors will cause all dividends and
distributions of any kind on the Pledged Stock (including any sums paid upon or
in respect of the Pledged Stock upon the liquidation or dissolution of the
Issuer or upon the recapitalization or reclassification of the capital of the
Issuer or upon the reorganization of the Issuer) to be paid directly to the
Pledgee (and if any such dividends or distributions are received by any Pledgor,
such Pledgor will hold them in trust for the benefit of, and will immediately
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turn them over to, the Pledgee) and the Pledgee will hold and dispose of all
such dividends and distributions as part of the Collateral.
6.4 Records; Inspection. Each Pledgor will keep full and accurate books
and records relating to the Collateral, and stamp or otherwise xxxx such books
and records in such manner as is required in order to reflect the pledge and
security interest granted pursuant hereto. Each Pledgor will permit
representatives of the Pledgee at any time upon reasonable advance notice to
inspect and make abstracts from its books and records pertaining to the
Collateral and to discuss matters relating to the Collateral with officers of
each Pledgor that is a corporation or other entity and with each Pledgor that is
an individual.
6.5 Costs, Expenses and Certain Taxes. Pledgors (a) will pay to the
Pledgee from time to time on demand any and all costs and expenses, including
reasonable attorneys' fees and expenses, paid or incurred by or on behalf of the
Pledgee in connection with this Agreement or the Note or in connection with any
modification, amendment, alteration or enforcement of this Agreement or the Note
or the collection of any amount payable by any Pledgor hereunder or under the
Note, whether or not any legal proceeding is commenced hereunder or thereunder
and whether or not any Default or Event of Default has occurred and is
continuing, and (b) will jointly and severally indemnify the Pledgee on demand
against any loss, liability or expense incurred by the Pledgee (other than any
such loss, liability or expense directly attributable to gross negligence or
willful misconduct of the Pledgee) arising out of or in connection with any
action or omission of the Pledgee hereunder or under the Note, including the
costs and expenses of defending itself against any claim or liability (including
any claim by any Pledgor) in connection with the exercise or performance of any
of its powers or duties hereunder or thereunder. All amounts payable to the
Pledgee under this Section accrue interest until paid in full at the rate of 18%
per annum, from the date of demand therefor. All such amounts shall constitute
additional indebtedness of the Pledgors secured hereunder and shall be payable
on demand. Pledgors will also pay, and will hold the Pledgee harmless from, any
and all liabilities with respect to, or resulting from any delay in paying, any
and all stamps, excise, sales or other taxes or assessments which may be payable
or determined to be payable with respect to any of the Collateral or in
connection with any of the transactions contemplated by this Agreement or the
Note. All expenses incident to the Pledgors' and Issuer's performance of or
compliance with Section 6.7, including, without limitation, all registration and
filing fees, all fees and expenses of complying with securities or blue sky
laws, National Association of Securities Dealers' fees, all printing expenses,
the fees and disbursements of counsel for the Issuer and of its independent
public accountants, and the expenses of any special audits made by such
accountants required by or incident to such performance and compliance, shall be
paid by the Pledgors; provided, however, that the Issuer agrees that it will
complete the registrations, qualifications and compliance required pursuant to
Section 6.7 even if it does not receive payment or reimbursement of such
expenses from the Pledgors.
6.6 Priority of Security Interest; Further Assurances. (a) Each Pledgor
will at all times cause the security interest granted pursuant to this Agreement
to constitute a valid perfected first priority security interest in the
Collateral, enforceable as such against all
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creditors of such Pledgor and any Persons purporting to purchase any Collateral
from such Pledgor.
(b) Each Pledgor will at any time and from time to time, at its own
expense, promptly execute and deliver all further instruments and documents, and
take all further actions, as may be necessary or desirable, or that the Pledgee
may reasonably request, in order to (i) grant more effectively a security
interest in favor of the Pledgee in all or any portion of the Collateral, (ii)
maintain, preserve, or perfect the security interest and lien created or
purported to be created by this Agreement and the first priority status of such
security interest and lien, (iii) preserve and defend against any Person such
Pledgor's title to the Collateral and the rights purported to be granted therein
by this Agreement, (iv) enable the Pledgee to exercise and enforce its rights
and remedies hereunder, or (v) carry out more effectively the purposes of this
Agreement. If the Issuer of Pledged Stock is incorporated in a jurisdiction
which does not permit the use of certificates to evidence equity ownership of
such Pledged Stock or permit a lien in favor of the Pledgee to be perfected by
the possession by the Pledgee of the certificates representing such Pledged
Stock then the Pledgors will to the extent permitted by applicable law, record
such lien on the stock register of the Issuer, execute any customary stock
pledge forms or other documents necessary to create, evidence or provide for the
perfection of such lien and give the Pledgee the right to transfer such Pledged
Stock under the terms hereof and provide to the Pledgee an opinion of counsel of
such jurisdiction, in form and substance satisfactory to it, confirming the
effectiveness, perfection and priority of such lien.
6.7 Registration of Pledged Stock. Pledgors, as soon as practicable and
at their sole cost and expense, will procure (and the Issuer agrees) that
registration and other qualification of the Pledged Stock under Federal and
state securities laws shall be effected by the Issuer (and kept continuously
effective in compliance with such laws for up to one year after the Maturity
Date as set forth in the Note) so as to permit or facilitate the sale and
distribution of such securities, including, without limitation, "shelf"
registration under the U.S. Securities Act of 1933, as amended (the "Securities
Act"), appropriate qualifications under applicable "blue sky" or other state
securities laws and appropriate compliance with any other governmental
requirements. The Pledgors (and the Issuer) shall ensure that such registration
is declared effective under the Securities Act and all other such qualifications
and compliance are completed prior to the Maturity Date as set forth in the
Note. Pledgors shall cause the Issuer to agree (and the Issuer agrees) to list
the Pledged Stock on the Nasdaq Stock Market. Pledgors will cause the Pledgee to
be kept advised in writing as to the progress of each such registration,
qualification or compliance and as to the completion thereof, will give the
Pledgee, any underwriter and their counsel reasonable opportunity to review and
comment on the registration statement and other documents incident thereto, to
conduct due diligence on the Issuer and to participate in the process, will
furnish to the Pledgee such number of prospectuses, preliminary prospectuses,
prospectus supplements or amendments or other documents incident thereto as the
Pledgee from time to time may reasonably request, and will indemnify the Pledgee
and all others participating in the distribution of such securities against all
claims, losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any prospectus, offering circular or other document
(including any
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related registration statement, notification or the like) incident to such
registration or by any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except (as to the Pledgee) insofar as the same may have
been caused by an untrue statement or omission based upon information furnished
in writing to Pledgor by the Pledgee expressly for use therein. The registration
statement filed with respect to the Pledged Stock and the prospectus contained
therein shall cover only the Pledged Stock and no other securities. The Pledgors
will cause the Issuer (and the Issuer agrees) to comply with all applicable
rules and regulations of the Securities and Exchange Commission (hereinafter
called "SEC") or similar federal commission, and of the Nasdaq Stock Market or
any other national securities exchange on which any of the Pledged Stock is
listed, if any, for so long as the registration is effective, to make available
to its security holders, as soon as practicable, an earnings statement covering
a period of at least 12 months, but not more than 18 months, beginning with the
first month after the effective date of the registration statement, which
earnings statement will satisfy the provisions of Section 11(a) of and Rule 158
under the Securities Act, and to make timely filing of all reports with the SEC
to enable the holders of the Pledged Stock, if they so elect, to utilize Rule
144 of the Securities Act in disposing of said securities. Pledgors (and the
Issuer) agree that, at Pledgee's request, the Issuer shall enter into an
underwriting agreement, which shall include, without limitation, indemnification
and contribution provisions and a "hold-back" or "lock-up" provision covering at
least 90 days and shall otherwise be in form and substance reasonably
satisfactory to Pledgee, with an underwriter for the Pledged Stock chosen by
Pledgee in its sole discretion, and furnish or cause to be furnished to such
underwriter and Pledgee a customary opinion of counsel and accountant's comfort
letter.
SECTION 7. RIGHTS OF THE PLEDGEE.
7.1 No Obligations or Liability to Pledgors. The rights and powers of
the Pledgee hereunder are not contingent upon the pursuit by the Pledgee of any
right or remedy against any Pledgor or against any other Person which may be or
become liable in respect of any of the Secured Obligations or against any other
collateral security or guarantee therefor or right of offset with respect
thereto, but are solely to protect its interest in the Collateral. The Pledgee
will not be liable for any failure to demand, collect or realize upon all or any
part of the Collateral or for any delay in doing so, nor is the Pledgee under
any obligation to sell or otherwise dispose of any Collateral upon the request
of any Pledgor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. No action or inaction on the part
of the Pledgee hereunder or under the Note will release any Pledgor from any of
its obligations hereunder or under the Note, or constitute an assumption of any
such obligations on the part of the Pledgee, or cause the Pledgee to become
subject to any obligation or liability to any Pledgor. The Pledgee has no
obligation to perform any of the obligations or duties of any Pledgor as a
shareholder of the Issuer.
7.2 Right of Pledgee to Perform Pledgor's Covenants, Etc. If any
Pledgor fails to make any payment or to perform any agreement required to be
made or performed hereunder, the Pledgee may (but need not) at any time
thereafter make such payment or perform such act, or otherwise cause such
payment or performance. No such action will
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create any liability to any Pledgor on the part of the Pledgee. All amounts so
paid by the Pledgee and all costs and expenses (including, without limitation,
attorneys' fees and expenses) incurred by the Pledgee in any such performance
shall accrue interest from the date paid or disbursed until reimbursed to the
Pledgee in full by or on behalf of the Pledgors at the rate established in
Section 6.5. All such amounts shall constitute additional indebtedness of the
Pledgors secured hereunder and shall be payable on demand.
7.3 Right of Pledgee to Demand Additional Pledged Shares. The Pledgee
shall have the right at any time, at its sole discretion, to demand by written
notice to the Pledgors that the Pledgors pledge to the Pledgee additional shares
of common stock of the Issuer owned of record and beneficially by one or more of
the Pledgors if, at such time, the product of (i) the total number of Shares
previously pledged to Pledgee pursuant to this Agreement and (ii) the Market
Value, is less than $13,000,000. The number of shares that may be demanded
pursuant to the preceding sentence shall, at the time of any such demand, be the
number of shares such that the product of (i) the sum of the total number of
shares previously pledged to Pledgee pursuant to this Agreement and the total
number of such additional shares to be pledged, and (ii) the Market Value, is
equal to $13,000,000. All shares at any time demanded pursuant to the provisions
of this Section 7.3 shall be "Demanded Shares." The Pledgee and the Pledgors
agree that Pledgee shall at no time be required to release from the pledge or
return to the Pledgors any Collateral, except in accordance with the provisions
of Section 6.2(b) and Section 7.4.
7.4 Release of the Pledge and Security Interest Created Hereby. Upon
payment in full of the outstanding principal amount of and accrued interest on
the Note in accordance with its terms and payment or satisfaction of all other
Secured Obligations, the Pledgee will, upon the written request of all Pledgors,
return to the Pledgors all Collateral held by the Pledgee.
SECTION 8. REMEDIES AND ENFORCEMENT.
8.1 Remedies in Case of an Event of Default. If an Event of Default has
occurred and is continuing, then in addition to the actions referred to in
Section 5.2 the Pledgee may take any or all of the following actions, without
demand of performance or other demand, advertisement or notice of any kind to or
upon Pledgors or any other Person (except as specified in Section 8.1(b)) all
and each of which are hereby expressly waived by Pledgors:
(a) The Pledgee may, in its own name or at its sole option in
the name of any Pledgor, exercise any or all of the rights, powers and
privileges of, and pursue any or all of the remedies accorded to, any
Pledgor under the Collateral and may exclude such Pledgor and all
Persons claiming by, through or under such Pledgor wholly or partly
therefrom, including in such rights, privileges and remedies, but
without limitation, all rights of such Pledgor to demand, receive, xxx
for, compromise and settle all payments in respect of the Collateral,
and in connection therewith to exercise all rights and remedies
thereunder which such Pledgor could enforce if this Agreement had not
been made.
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(b) The Pledgee may forthwith collect, recover, receive,
appropriate and realize upon the Collateral, or any part thereof,
and/or may forthwith sell, assign, give an option or options to
purchase, contract to sell or otherwise dispose of and deliver the
Collateral, or any part thereof, in one or more parcels at public or
private sale or sales, at any exchange, broker's board or at any of the
Pledgee's offices or elsewhere upon such terms and conditions as it may
deem advisable and at such prices as it may deem best, for cash or on
credit or for future delivery without assumption of any credit risk.
The Pledgee need not make any sale of Collateral even if notice thereof
has been given, may reject any and all bids that in its commercially
reasonable discretion it shall deem inadequate, and may adjourn any
public or private sale. Pledgors hereby acknowledge that the Collateral
is of a type that could decline speedily in value and is also of a type
customarily sold on a recognized market, in each case within the
meaning of Section 9-504 of the UCC as in effect in any applicable
jurisdiction, and that the Pledgee need not give any notice to Pledgors
prior to any sale of the Collateral at any exchange, broker's board or
in any other recognized market. Without limiting the foregoing, each
Pledgor agrees that the Pledgee need not give more than five days
notice of the time and place of any public sale or of the time after
which a private sale or other intended disposition is to take place and
that such notice is reasonable notification of such matters, and waives
all other demands or notices of any kind.
(c) The Pledgee may, as a matter of right and without notice
to any Pledgor or any Person claiming by, through or under any Pledgor,
cause the appointment of a receiver for all or any part of the
Collateral.
(d) In addition to all other rights and remedies granted to it
in this Agreement and in any other instrument or agreement securing,
evidencing or relating to any of the Secured Obligations, the Pledgee
will have and may exercise with respect to any or all of the Collateral
all of the rights and remedies of a secured party under the UCC and all
other legal and equitable remedies allowed under applicable law.
Each Pledgor consents to and ratifies any action which the Pledgee may
take to enforce its rights under this Section 8.1. Each Pledgor waives to the
full extent permitted by law the benefit of all appraisement, valuation, stay,
extension, moratorium and redemption laws now or hereafter in force and all
rights of marshaling in the event of the sale of the Collateral or any part
thereof or any interest therein. Each Pledgor will execute and deliver such
documents as the Pledgee deems advisable or necessary in order that any such
sale or disposition be made in compliance with applicable law.
Any sale or other disposition of the Collateral or any part thereof or
interest therein in the exercise of any remedy hereunder will constitute a
perpetual bar against each Pledgor and any Persons claiming by, through or under
any Pledgor. Upon any such sale or other disposition, the receipt of the officer
or agent making the sale or other disposition or of the Pledgee is a sufficient
discharge to the purchaser for the purchase money, and such purchaser will have
no duty to see to the application thereof.
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8.2 Application of Proceeds Following an Event of Default. All amounts
held or collected by the Pledgee as part of the Collateral (including, without
limitation, all amounts realized as a result of the exercise of any rights and
remedies hereunder) following the occurrence of any Event of Default will be
applied forthwith by the Pledgee as follows:
FIRST: to the payment of all costs and expenses of such
exercise (including, without limitation, the cost of evidence of title
and the costs and expenses, if any, of taking possession of, retaining
custody over and preserving the Collateral or any part thereof, or any
interest therein prior to such exercise), all costs and expenses of any
receiver of the Collateral or any part thereof, or any interest
therein, any taxes, assessments or charges with respect to any of the
Collateral, whether or not prior to the lien of this Agreement, which
the Pledgee may consider it necessary or desirable to pay and all
amounts due and payable to the Pledgee under Section 6.5 and unpaid;
SECOND: to the payment of the accrued and unpaid interest
(including interest on unpaid principal and, to the extent permitted by
applicable law, unpaid interest) of the Note in accordance with the
provisions of the Note;
THIRD: if the Note has not become due and payable in full, to
the payment of all outstanding principal then due and payable on the
Note;
FOURTH: if the Note has become due and payable in full whether
at maturity, by prepayment, acceleration, declaration of default or
otherwise, to the payment of the outstanding principal of the Note in
accordance with the provisions of the Note;
FIFTH: to the ratable payment to the Persons entitled thereto
of all other obligations secured hereunder for which moneys have not
theretofore been applied; and
SIXTH: at such time as all of the obligations of the Pledgors
under the Note have been paid in full in cash or in stock in accordance
with the terms of the Note and all other Secured Obligations have been
paid or performed to the satisfaction of the Pledgee, the remainder, if
any, will be paid over to Pledgors, their successors or assigns, or to
whomsoever may be lawfully entitled to receive the same, as determined
by a court of competent jurisdiction.
8.3 Purchase of Collateral by Pledgee. The Pledgee may be a purchaser
of the Collateral or any part thereof or any interest therein at any sale or
other disposition hereunder and may apply against the purchase price the
indebtedness secured hereby.
8.4 Purchaser to Acquire Good Title. Any purchaser of the Collateral at
any sale or other disposition thereof pursuant to this Section 8 will, upon any
such purchase, acquire good title to the Collateral so purchased free of the
lien and security interest created by this Agreement and free of all rights of
equity or redemption in any Pledgor, which rights each Pledgor hereby expressly
waives and releases to the full extent
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permitted by law, and each Pledgor will warrant and defend the title of such
purchaser against all claims arising by, through or under the Pledgors.
Nevertheless, if so requested by the Pledgee or any such purchaser, each Pledgor
will ratify and confirm any exercise of remedies by the Pledgee hereunder by
executing and delivering to the Pledgee or such purchaser all bills of sale,
assignments, releases and other proper instruments to effect such ratification
and confirmation as may be designated in any such request. In addition, each
Pledgor will do or cause to be done all such other acts and things as may be
reasonably necessary to make such exercise of remedies valid and binding and in
compliance with any and all applicable laws, regulations, orders, writs,
injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such exercise, all at such Pledgor's expense.
8.5 Sale of Pledged Stock Without Registration. Pledgor recognizes
that, under certain circumstances, (i) the Pledgee may be unable to effect a
public sale of any or all of the Pledged Stock by reason of the Securities Act
and applicable state or foreign securities laws or otherwise, but may be
compelled to resort to one or more private sales thereof to a restricted group
of purchasers who will be obliged to agree, among other things, to acquire such
securities for their own account for investment and not with a view to the
distribution or resale thereof and who otherwise satisfy the requirements of any
such applicable law, and (ii) any such private sale may result in prices and
other terms less favorable to the seller than if such sale were a public sale.
No such sale will be deemed to have been made in a commercially unreasonable
manner for the reason that it was made as a private sale rather than a public
sale, and the Pledgee will be under no obligation to delay a sale of any of the
Pledged Stock for the period of time necessary to permit the issuer of such
securities to register such securities for public sale under the Securities Act,
or under applicable state securities laws, or otherwise comply with applicable
law, even if the issuer would agree or has agreed to do so and would be able to
do so.
8.6 Appointment as Attorney-in-Fact. Each Pledgor hereby irrevocably
constitutes and appoints the Pledgee, with full power of substitution, as such
Pledgor's attorney-in-fact, with full irrevocable power and authority in the
place and stead of such Pledgor and in the name of such Pledgor or otherwise,
from time to time in the Pledgee's discretion, to execute and deliver any and
all bills of sale, assignments or other instruments which the Pledgee may deem
necessary or advisable in its exercise of any of the remedies hereunder, and to
take any other action to accomplish the purposes of this Agreement, including,
without limitation, to ask, demand, collect, xxx for, recover, compound, receive
and give acquittance and receipt for moneys due and to become due under or in
connection with the Collateral, to receive, endorse, and collect any drafts or
other instruments, documents and chattel paper in connection therewith, and to
file any claims or take any action or institute any proceedings which the
Pledgee may deem to be necessary or desirable for the collection thereof, such
Pledgor hereby ratifying and confirming all that such attorney or any substitute
may lawfully do by virtue hereof. This power of attorney is a power coupled with
an interest and is irrevocable.
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8.7 No Waiver; Cumulative Remedies. No action or inaction of the
Pledgee will be deemed to waive any of the rights, powers or remedies of the
Pledgee hereunder except pursuant to a writing, signed by the Pledgee, and then
only to the extent expressly set forth therein. A waiver by the Pledgee of any
right, power or remedy on any one occasion will not bar the exercise of any
right, power or remedy hereunder on any future occasion. No failure of the
Pledgee to exercise nor delay of the Pledgee in exercising any right, power or
remedy will preclude the exercise of any other right, power or remedy. If the
Pledgee accepts payment of any amount secured hereby after its due date, it will
not thereby be deemed to have waived its right to require prompt payment when
due of all other amounts payable hereunder. Each right, power and remedy of the
Pledgee provided for in this Agreement or now or hereafter existing at law or
equity or by statute or otherwise is cumulative and concurrent and is in
addition to every other such right, power or remedy of the Pledgee, and the
exercise of any one or more of any such rights, powers or remedies with respect
to any of the Collateral will not preclude the simultaneous or later exercise by
the Pledgee of any other right, power or remedy with respect to any other
Collateral.
8.8 Restoration of Rights and Remedies. If the Pledgee has instituted
any proceeding to enforce any right, power or remedy under this Agreement and
such proceeding has been discontinued or abandoned for any reason, with or
without notice to Pledgors, or has been determined adversely to the Pledgee,
then and in every such case Pledgors and the Pledgee will be restored to their
former positions hereunder, and thereafter all rights, powers and remedies of
the Pledgee will continue as though no such proceeding had been instituted.
SECTION 9. PLEDGOR'S OBLIGATIONS NOT AFFECTED.
The covenants and agreements of each Pledgor set forth herein are
primary obligations of such Pledgor. All such obligations are absolute and
unconditional, are not subject to any counterclaim, set-off, deduction,
diminution, abatement, recoupment, suspension, deferment, reduction or defense
(other than full and strict compliance by such Pledgor with its obligations
hereunder) based upon any claim any Pledgor, the Issuer or any other Person may
have against the Pledgee or any other Person. All such obligations will remain
in full force and effect without regard to, and will not be released, discharged
or in any way affected by, any unenforceability, invalidity or other infirmity
with respect to the Note, or any other circumstance, condition or occurrence
whatsoever, whether foreseeable or unforeseeable and without regard to whether
any Pledgor, the Issuer or the Pledgee shall have any knowledge or notice
thereof.
SECTION 10. MISCELLANEOUS.
10.1 Amendments, Etc. Any amendment, modification or waiver of any term
or provision of this Agreement must be in writing and signed by the Pledgee. Any
such waiver will be effective only in the specific instance and for the specific
purpose for which it is given.
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10.2 Survival of Agreements, Representations and Warranties. All
agreements, representations and warranties contained in this Agreement or the
Note or made in writing by or on behalf of any Pledgor in connection with the
transactions contemplated by this Agreement or the Note will survive the
execution and delivery of this Agreement, any investigation at any time made by
or on behalf of the Pledgee, the purchase of any Note or any payment of any Note
or any disposition of any Note.
10.3 Successors and Assigns. This Agreement is binding upon and will
inure to the benefit of and be enforceable by the respective successors and
assigns of the parties hereto, whether so expressed or not.
10.4 Entire Agreement. This Agreement and the Note embody the entire
agreement and understanding between Pledgors and the Pledgee with respect to the
transaction referred to herein and therein and supersede all prior agreements
and understandings, written or oral, relating to the pledge of collateral to the
Pledgee to secure the obligations of the Pledgors under the Note.
10.5 Severability. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction is, as to such jurisdiction, ineffective
only to the extent made necessary by such prohibition or unenforceability. Any
such prohibition or unenforceability in any jurisdiction will not invalidate or
render unenforceable (i) the remaining provisions hereof or (ii) such provision
in any other jurisdiction. There shall be substituted for any such provision so
rendered ineffective a provision which, as far as legally possible, most nearly
reflects the intent of the parties hereto.
10.6 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LEGAL OR EQUITABLE
ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY OR THE SUBJECT MATTER OF
ANY OF THE FOREGOING.
10.7 Agreement May Constitute Financing Statement. Each Pledgor
consents to the filing of this Agreement or a photocopy thereof as a financing
statement under the Uniform Commercial Code as in effect in any jurisdiction in
which the Pledgee may determine such filing to be necessary or desirable.
10.8 Miscellaneous. This Agreement may be executed in any number of
counterparts, each of which is an original, but all of which together constitute
but one instrument. Except as otherwise indicated, references herein to any
"Section" means a "Section" of this Agreement. The table of contents and the
section headings in this Agreement are for purposes of reference only and shall
not limit or define the meaning hereof.
10.9 GOVERNING LAW. THIS AGREEMENT AND (UNLESS OTHERWISE EXPRESSLY
PROVIDED) ALL AMENDMENTS AND SUPPLEMENTS TO, AND ALL CONSENTS AND WAIVERS
PURSUANT TO,
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THIS AGREEMENT WILL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO PRINCIPLES OF CONFLICTS OF LAW, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE.
10.10 Notices, Etc. All notices and other communications provided for
hereunder must be in writing (including telegraphic, telex, telecopy or cable
communication) and must be sent (a) if to any Pledgor, at its address listed on
Exhibit B attached hereto, (b) if to Pledgee, at 000 Xxxxx Xxxx Xxx, Xxxxx 000,
Xxxx Xxxxx, XX 00000, Telephone: 000-000-0000, Facsimile: 000-000-0000, or (c)
as to each party, at such other address as shall be designated by such party in
a written notice to the other parties. All such notices and communications are
effective when received.
10.11 Submission to Jurisdiction; Waiver of Immunity; Agent for Service
of Process. For the purpose of assuring that the Pledgee may enforce its rights
under this Agreement, each Pledgor, for itself and its successors and assigns,
hereby irrevocably (a) agrees that any legal or equitable action, suit or
proceeding against any Pledgor arising out of or relating to this Agreement or
any transaction contemplated hereby or the subject matter of any of the
foregoing may be instituted, at the election of the Pledgee, in any state or
federal court in the State of Virginia (including, without limitation, the U.S.
Federal District Court for the Eastern District of Virginia) or in any state or
federal court in the State of Florida, (b) waives any objection which it may now
or hereafter have to the venue of any action, suit or proceeding, (c)
irrevocably submits itself to the nonexclusive jurisdiction of any state or
federal court of competent jurisdiction in the State of Virginia or the State of
Florida, and (d) irrevocably waives any immunity from jurisdiction to which it
might otherwise be entitled in any such action, suit or proceeding which may be
instituted in any state or federal court of the State of Virginia or the State
of Florida, and any immunity from the maintaining of an action against it to
enforce any judgment for money obtained in any such action, suit or proceeding
and, to the extent permitted by applicable law, any immunity from execution. Not
later than August 15, 2000, each Pledgor shall irrevocably designate and appoint
CT Corporation System (or any successor corporation), at its office in Virginia
and its office in Florida, as its authorized agent to accept and acknowledge on
its behalf service of any and all process which may be served in any such
action, suit or proceeding with respect to any matter as to which it has
submitted to jurisdiction as set forth in this Section 10.11 and agrees that
service upon such authorized agent shall be deemed in every respect service of
process upon such Pledgor or its successors or assigns, and, to the extent
permitted by applicable law, shall be taken and held to be valid personal
service upon it. Each Pledgor will take all action necessary to ensure that such
Pledgor shall at all times have an agent for service of process for the above
purposes in the State of Virginia and the State of Florida. This Section 10.11
does not affect the right of the Pledgee to serve process in any other manner
permitted by law or to commence legal proceedings or otherwise proceed against
any Pledgor in any jurisdiction.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered personally or by their
representative officers or agents duly authorized as of the date first above
written.
Pledgors:
GOLD & XXXXX TRANSFER, S.A.
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx,
Attorney-in-Fact
REVISION LLC
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx,
Manager
FOUNDATION FOR THE INTERNATIONAL
NON-GOVERNMENTAL DEVELOPMENT
OF SPACE
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx,
President
XXXXXX X. XXXXXXXX
/s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx
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Pledgee:
XXXXXX X. XXXXX
/s/ Xxxxxx X. Xxxxx
-------------------
Xxxxxx X. Xxxxx
AGREED AND ACCEPTED (as to Sections 6.5 and 6.7 of the Agreement):
TOTAL-TEL USA COMMUNICATIONS, INC.
By: /s/ A. Xxxx Xxxxx, Jr.
----------------------
Name: A. Xxxx Xxxxx, Jr.
Title: President & CEO
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Exhibit A
SHARES:
The Shares consist of:
571,400 shares owned of record and beneficially by Gold & Xxxxx, and represented
in certificated form by stock certificate number CU0008824 of the Issuer (the
"Gold & Xxxxx Shares");
1,179,732 shares owned of record and beneficially by Revision, and represented
in certificated form by stock certificate number CU0008823 of the Issuer (the
"Revision Shares"); and
703,529 shares owned of record and beneficially by FINDS, and represented in
certificated form by stock certificate number CU0008825 of the Issuer (the
"FINDS Shares").
INITIAL PLEDGED SHARES:
The Initial Pledged Shares consist of the Gold & Xxxxx Shares and the Revision
Shares.
ADDITIONAL INITIAL SHARES:
The Additional Initial Shares consist of the FINDS Shares.
INITIAL RELEASE SHARES:
The Initial Release Shares consist of the Gold & Xxxxx Shares.
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Exhibit B
NOTICE ADDRESSES FOR PLEDGORS
The notice addresses for the respective Pledgors are as
follows:
(a) If to Gold & Xxxxx:
Xxxx Xxxxx Building
Wickams Cay
Road Town, Tortolla
British Virgin Islands
with copies to:
Xxxx X. XxXxxxxxxx
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
0000 X Xxxxxx XX
Xxxxxxxxxx, X.X. 00000-0000
Facsimile: 000-000-0000
and
Xxxxxx X. Xxxxxxxx
Revision LLC
0000 00xx Xxxxxx, XX
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Facsimile: 000-000-0000
(b) If to Revision:
Revision LLC
0000 00xx Xxxxxx, XX
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxxxxx
Facsimile: 000-000-0000
with a copy to:
Xxxx X. XxXxxxxxxx
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
0000 X Xxxxxx XX
Xxxxxxxxxx, X.X. 00000-0000
Facsimile: 000-000-0000
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(c) If to FINDS:
0000 X Xxxxxx XX
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
with copies to:
Xxxx X. XxXxxxxxxx
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
0000 X Xxxxxx XX
Xxxxxxxxxx, X.X. 00000-0000
Facsimile: 000-000-0000
and
Xxxxxx X. Xxxxxxxx
Revision LLC
0000 00xx Xxxxxx, XX
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Facsimile: 000-000-0000
(d) If to Xxxxxxxx:
c/o Revision LLC
0000 00xx Xxxxxx, XX
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxxxxx
Facsimile: 000-000-0000
with a copy to:
Xxxx X. XxXxxxxxxx
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
0000 X Xxxxxx XX
Xxxxxxxxxx, X.X. 00000-0000
Facsimile: 000-000-0000
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