EXECUTION COPY
STOCK PLEDGE AGREEMENT
STOCK PLEDGE AGREEMENT, made as of April 8, 2002, by and between
PC-EPhone, Inc., a Nevada corporation (the "Pledgor"), and Process Control
(Holdings) Limited, a corporation formed under the laws of Ireland (the
"Lender").
WHEREAS, the Pledgor and other parties have entered into a Credit
Agreement dated as of April 8, 2002 (as amended and in effect from time to
time, the "Credit Agreement"), with the Lender, pursuant to which the Lender,
subject to the terms and conditions contained therein, is to make loans to the
Pledgor;
WHEREAS, the Pledgor is the direct or indirect legal and beneficial owner
of all of the issued and outstanding shares of each class of the capital stock
of each of the corporations and other organizations described on Annex A
(collectively, the "Subsidiaries" and individually a "Subsidiary");
WHEREAS, it is a condition precedent to the Lender making any loans or
otherwise extending credit to the Pledgor under the Credit Agreement that the
Pledgor execute and deliver to the Lender a pledge agreement in substantially
the form hereof; and
WHEREAS, the Pledgor wishes to grant pledges and security interests in
favor of the Lender as herein provided.
NOW, THEREFORE, in consideration of the premises contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Pledge of Stock, etc.
1.1 Pledge of Stock. The Pledgor hereby pledges, assigns, grants
a security interest in, and delivers to the Lender all of the shares
of capital stock of the Subsidiaries owned by the Pledgor of every
class, as more fully described on Annex A hereto, to be held by the
Lender subject to the terms and conditions hereinafter set forth. The
certificates for such shares, accompanied by stock powers or other
appropriate instruments of assignment thereof duly executed in blank
by the Pledgor, have been delivered to the Lender, or will be
delivered to Lender within three (3) business days of the date
hereof.
1.2 Additional Stock. In case the Pledgor shall acquire any
additional shares of the capital stock of any other Person or
corporation, including any Subsidiary or corporation which is the
successor of any Subsidiary, or any securities exchangeable for or
convertible into shares of such capital stock of any class of any
Person, whether by purchase, stock dividend, stock split or
otherwise, then such shares or other securities shall be subject to
the pledge, assignment and security interest granted to the Lender
under this Agreement and the Pledgor shall deliver to the Lender
forthwith any certificates therefor, accompanied by stock powers or
other appropriate instruments of assignment duly executed by the
Pledgor in blank. The Pledgor agrees that the Lender may from time to
time attach as Annex A hereto an updated list of the shares of
capital stock or securities at the time pledged with the Lender
hereunder.
1.3 Pledge of Cash Collateral Account. The Pledgor also hereby
pledges, assigns, grants a security interest in, and delivers to the
Lender the Cash Collateral Account and all of the Cash Collateral as
such terms are hereinafter defined.
2. Definitions. The term "Obligations" and all other capitalized terms
used herein without definition shall have the respective meanings provided
therefor in the Credit Agreement. Terms used herein and not defined in the
Credit Agreement or otherwise defined herein that are defined in the New York
Uniform Commercial Code have such defined meanings herein (with terms used in
Article 9 controlling over terms used in another Article), unless the context
otherwise indicated or requires, and the following terms shall have the
following meanings:
Cash Collateral. Seess.4.
Cash Collateral Account. Seess.4.
Securities Act. Seess.7.3.
Stock. Includes the shares of stock described in Annex A attached hereto
and any additional shares of stock at the time pledged with the Lender
hereunder.
Stock Collateral. The property at any time pledged to the Lender hereunder
(whether described herein or not) and all income therefrom, increases therein
and proceeds thereof, including without limitation that included in Cash
Collateral. The term does not include any income, increases or proceeds
received by the Pledgor to the extent expressly permitted by ss.6.
Time Deposits. Seess.4.
3. Security for Obligations. This Agreement and the security interest in
and pledge of the Stock Collateral hereunder are made with and granted to the
Lender as security for the payment and performance in full of all the
Obligations.
4. Liquidation, Recapitalization, etc.
4.1 Distributions Paid to Lender. Any sums or other property paid or
distributed upon or with respect to any of the Stock, whether by dividend
or redemption or upon the liquidation or dissolution of the issuer thereof
or otherwise, shall, except to the limited extent provided in Section 6, be
paid over and delivered to the Lender to be held by the Lender as security
for the payment and performance in full of all of the Obligations. In
case, pursuant to the recapitalization or reclassification of the capital
of the issuer thereof or pursuant to the reorganization thereof, any
distribution of capital shall be made on or in respect of any of the Stock
or any property shall be distributed upon or with respect to any of the
Stock, the property so distributed shall be delivered to the Lender to be
held by it as security for the Obligations. Except to the limited extent
provided in ss.6, all sums of money and property paid or distributed in
respect of the Stock, whether as a dividend or upon such a liquidation,
dissolution, recapitalization or reclassification or otherwise, that are
received by the Pledgor shall, until paid or delivered to the Lender, be
held in trust for the Lender as security for the payment and performance
in full of all of the Obligations.
4.2 Cash Collateral Account. All sums of money that are delivered to
the Lender pursuant to this ss.4 shall be deposited into an interest
bearing account in the name of the Lender, as customer with a depositary
bank satisfactory to the Lender (any such account, whether maintained with
the Lender or in the Lender's name as customer being herein referred to as
the "Cash Collateral Account"). Some or all of the funds from time to time
in the Cash Collateral Account may be invested in time deposits,
including, without limitation, certificates of deposit issued by the
Lender (such certificates of deposit or other time deposits being
hereinafter referred to, collectively, as "Time Deposits"), that are
satisfactory to the Lender after consultation with the Pledgor, provided,
that, in each such case, arrangements satisfactory to the Lender are made
and are in place to perfect and to ensure the first priority of the
Lender's security interest therein. Interest earned on the Cash Collateral
Account and on the Time Deposits, and the principal of the Time Deposits
at maturity that is not invested in new Time Deposits, shall be deposited
in the Cash Collateral Account. The Cash Collateral Account, all sums from
time to time standing to the credit of the Cash Collateral Account, any
and all Time Deposits, any and all instruments or other writings
evidencing Time Deposits and any and all proceeds or any thereof are
hereinafter referred to as the "Cash Collateral."
4.3 Pledgor's Rights to Cash Collateral, etc. Except as otherwise
expressly provided in ss.15, the Pledgor shall have no right to withdraw
sums from the Cash Collateral Account, to receive any of the Cash
Collateral or to require the Lender to part with the Lender's possession
of any instruments or other writings evidencing any Time Deposits.
5. Warranty of Title; Authority. The Pledgor hereby represents and
warrants that: (a) the Pledgor has good and marketable title to, and is the
sole record and beneficial owner of, the Stock described in ss.1, subject to no
pledges, liens, security interests, charges, options, restrictions or other
encumbrances except the pledge and security interest created by this Agreement,
(b) all of the Stock described in ss.1 is validly issued, fully paid and
non-assessable, (c) the Pledgor has full power, authority and legal right to
execute, deliver and perform its obligations under this Agreement and to pledge
and grant a security interest in all of the Stock Collateral pursuant to this
Agreement, and the execution, delivery and performance hereof and the pledge of
and granting of a security interest in the Stock Collateral hereunder have been
duly authorized by all necessary corporate or other action and do not
contravene any law, rule or regulation or any provision of the Pledgor's
charter documents or by-laws or of any judgment, decree or order of any
tribunal or of any agreement or instrument to which the Pledgor is a party or
by which it or any of its property is bound or affected or constitute a default
thereunder, and (d) the information set forth in Annex A hereto relating to the
Stock is true, correct and complete in all respects. The Pledgor covenants that
it will defend the rights and security interest of the Lender in such Stock
against the claims and demands of all other persons whomsoever. The Pledgor
further covenants that it will have the like title to and right to pledge and
grant a security interest in the Stock Collateral hereafter pledged or in which
a security interest is granted to the Lender hereunder and will likewise defend
the rights, pledge and security interest thereof and therein of the Lender.
6. Dividends, Voting, etc., Prior to Maturity. So long as no Default or
Event of Default shall have occurred and be continuing, the Pledgor shall be
entitled to receive dividends permitted under the Credit Agreement paid in
respect of the Stock, to vote the Stock and to give consents, waivers and
ratifications in respect of the Stock; provided, however, that no vote shall be
cast or consent, waiver or ratification given by the Pledgor if the effect
thereof would in the reasonable judgment of the Lender impair any of the Stock
Collateral or be inconsistent with or result in any violation of any of the
provisions of the Credit Agreement or any of the other Loan Documents. All such
rights of the Pledgor to receive cash dividends shall cease in case a Default
or an Event of Default shall have occurred and be continuing. All such rights
of the Pledgor to vote and give consents, waivers and ratifications with
respect to the Stock shall, at the Lender's option, as evidenced by the
Lender's notifying the Pledgor of such election, cease in case a Default or an
Event of Default shall have occurred and be continuing.
7. Remedies.
7.1 In General. If a Default or an Event of Default shall have
occurred and be continuing, the Lender shall thereafter have the following
rights and remedies (to the extent permitted by applicable law) in
addition to the rights and remedies of a secured party under the New York
Uniform Commercial Code, all such rights and remedies being cumulative,
not exclusive, and enforceable alternatively, successively or
concurrently, at such time or times as the Lender deems expedient:
(a) if the Lender so elects and gives notice of such election to
the Pledgor, the Lender may vote any or all shares of the Stock
(whether or not the same shall have been transferred into its name or
the name of its nominee or nominees) for any lawful purpose,
including, without limitation, if the Lender so elects, for the
liquidation of the assets of the issuer thereof, and give all
consents, waivers and ratifications in respect of the Stock and
otherwise act with respect thereto as though it were the outright
owner thereof (the Pledgor hereby irrevocably constituting and
appointing the Lender the proxy and attorney-in-fact of the Pledgor,
with full power of substitution, to do so);
(b) the Lender may demand, xxx for, collect or make any
compromise or settlement the Lender deems suitable in respect of any
Stock Collateral;
(c) the Lender may sell, resell, assign and deliver, or
otherwise dispose of any or all of the Stock Collateral, for cash or
credit or both and upon such terms at such place or places, at such
time or times and to such entities or other persons as the Lender
thinks expedient, all without demand for performance by the Pledgor
or any notice or advertisement whatsoever except as expressly
provided herein or as may otherwise be required by law;
(d) the Lender may cause all or any part of the Stock held by it
to be transferred into its name or the name of its nominee or
nominees; and
(e) the Lender may set off or otherwise apply or credit against
the Obligations any and all sums deposited with it or held by it,
including without limitation, any sums standing to the credit of the
Cash Collateral Account and any Time Deposits issued by the Lender.
7.2 Sale of Stock Collateral. In the event of any sale or other
disposition of the Stock Collateral as provided in clause (c) of ss.7.1
and to the extent that any notice thereof is required to be given by law,
the Lender shall give to the Pledgor at least five (5) Business Days'
prior authenticated notice of the time and place of any public sale or
other disposition of the Stock Collateral or of the time after which any
private sale or any other intended disposition is to be made. The Pledgor
hereby acknowledges that five (5) Business Days' prior authenticated
notice of such sale or other disposition or sales or other dispositions
shall be reasonable notice. The Lender may enforce its rights hereunder
without any other notice and without compliance with any other condition
precedent now or hereunder imposed by statute, rule of law or otherwise
(all of which are hereby expressly waived by the Pledgor, to the fullest
extent permitted by law). The Lender may buy or otherwise acquire any part
or all of the Stock Collateral at any public sale or other disposition and
if any part or all of the Stock Collateral is of a type customarily sold
or otherwise disposed of in a recognized market or is of the type which is
the subject of widely-distributed standard price quotations, the Lender
may buy or otherwise acquire at private sale or other disposition and may
make payments thereof by any means. The Lender may apply the cash proceeds
actually received from any sale or other disposition to the reasonable
expenses of retaking, holding, preparing for sale, selling and the like,
to reasonable attorneys' fees, travel and all other expenses which may be
incurred by the Lender in attempting to collect the Obligations or to
enforce this Agreement or in the prosecution or defense of any action or
proceeding related to the subject matter of this Agreement, and then in
such order or preference as the Lender may determine after proper
allowance for Obligations not then due. Only after such applications, and
after payment by the Lender of any amount required by ss.9-608(a)(1)(C) or
ss.9-615(a)(3) of the New York Uniform Commercial Code, need the Lender
account to the Pledgor for any surplus.
7.3 Registration of Stock. If the Lender shall determine to exercise
its right to sell or otherwise dispose of any or all of the Stock pursuant
to this ss.7, and if in the opinion of counsel for the Lender it is
necessary, or if in the reasonable opinion of the Lender it is advisable,
to have the Stock, or that portion thereof to be sold, registered under
the provisions of the Securities Act of 1933, as amended (the "Securities
Act"), the Pledgor agrees to use its best efforts to cause the issuer or
issuers of the Stock contemplated to be sold, to execute and deliver, and
cause the directors and officers of such issuer to execute and deliver,
all at the Pledgor's expense, all such instruments and documents, and to
do or cause to be done all such other acts and things as may be necessary
or, in the reasonable opinion of the Lender, advisable to register such
Stock under the provisions of the Securities Act and to cause the
registration statement relating thereto to become effective and to remain
effective for a period of 9 months from the date such registration
statement became effective, and to make all amendments thereto or to the
related prospectus or both that, in the reasonable opinion of the Lender,
are necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and
Exchange Commission applicable thereto. The Pledgor agrees to use its best
efforts to cause such issuer or issuers to comply with the provisions of
the securities or "Blue Sky" laws of any jurisdiction which the Lender
shall designate and to cause such issuer or issuers to make available to
its security holders, as soon as practicable, an earnings statement which
will satisfy the provisions of Section 11(a) of the Securities Act.
7.4 Private Sales. The Pledgor recognizes that the Lender may be
unable to effect a public sale or other disposition of the Stock by reason
of certain prohibitions contained in the Securities Act, federal banking
laws, and other applicable laws, but may be compelled to resort to one or
more private sales thereof to a restricted group of purchasers. The
Pledgor agrees that any such private sales may be at prices and other
terms less favorable to the seller than if sold at public sales and that
such private sales shall not by reason thereof be deemed not to have been
made in a commercially reasonable manner. The Pledgor shall be under no
obligation to delay a sale of any of the 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 such other federal
banking or other applicable laws, even if the issuer would agree to do so.
Subject to the foregoing, the Lender agrees that any sale of the Stock
shall be made in a commercially reasonable manner and the Pledgor agrees
to use its best efforts to cause the issuer or issuers of the Stock
contemplated to be sold, to execute and deliver, and cause the directors
and officers of such issuer to execute and deliver, all at the Pledgor's
expense, all such instruments and documents, and to do or cause to be done
all such other acts and things as may be necessary or, in the reasonable
opinion of the Lender, advisable to exempt such Stock from registration
under the provisions of the Securities Act, and to make all amendments to
such instruments and documents which, in the opinion of the Lender, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and
Exchange Commission applicable thereto. The Pledgor further agrees to use
its best efforts to cause such issuer or issuers to comply with the
provisions of the securities or "Blue Sky" laws of any jurisdiction which
the Lender shall designate and, if required, to cause such issuer or
issuers to make available to its security holders, as soon as practicable,
an earnings statement (which need not be audited) which will satisfy the
provisions of Section 11(a) of the Securities Act.
7.5 Pledgor's Agreements, etc. The Pledgor further agrees to do or
cause to be done all such other acts and things as may be reasonably
necessary to make any sales of any portion or all of the Stock pursuant to
this ss.7 valid and binding and in compliance with any and all applicable
laws (including, without limitation, the Securities Act, the Securities
Exchange Act of 1934, as amended, the rules and regulations of the
Securities and Exchange Commission applicable thereto and all applicable
state securities or "Blue Sky" 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 sale or sales, all at the Pledgor's expense. The Pledgor
further agrees that a breach of any of the covenants contained in this
ss.7 will cause irreparable injury to the Lender, that the 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 ss.7 shall be
specifically enforceable against the Pledgor by the Lender and the Pledgor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants.
8. Marshalling. The Lender shall not be required to marshal any present
or future collateral security for (including but not limited to this Agreement
and the Stock Collateral), or other assurances of payment of, the Obligations or
any of them, or to resort to such collateral security or other assurances of
payment in any particular order. All of the Lender's rights hereunder and in
respect of such collateral security and other assurances of payment shall be
cumulative and in addition to all other rights, however existing or arising. To
the extent that it lawfully may, the Pledgor hereby agrees that it will not
invoke any law relating to the marshalling of collateral that might cause delay
in or impede the enforcement of the Lender's rights under this Agreement or
under any other instrument evidencing any of the Obligations or under which any
of the Obligations is outstanding or by which any of the Obligations is secured
or payment thereof is otherwise assured, and to the extent that it lawfully may
the Pledgor hereby irrevocably waives the benefits of all such laws.
9. Pledgor's Obligations Not Affected. The obligations of the Pledgor
hereunder shall remain in full force and effect without regard to, and shall
not be impaired by (a) any exercise or nonexercise, or any waiver, by the
Lender of any right, remedy, power or privilege under or in respect of any of
the Obligations or any security thereof (including this Agreement); (b) any
amendment to or modification of the Credit Agreement, other Loan Documents or
any of the Obligations; (c) any amendment to or modification of any instrument
(other than this Agreement) securing any of the Obligations, including, without
limitation, any of the Collateral Documents; or (d) the taking of additional
security for, or any other assurances of payment of, any of the Obligations or
the release or discharge or termination of any security or other assurances of
payment or performance for any of the Obligations; whether or not the Pledgor
shall have notice or knowledge of any of the foregoing, the Pledgor hereby
generally waiving all suretyship defenses to the extent applicable.
10. Transfer, etc., by Pledgor. Without the prior written consent of the
Lender, the Pledgor will not sell, assign, transfer or otherwise dispose of,
grant any option with respect to, or pledge or grant any security interest in
or otherwise encumber or restrict any of the Stock Collateral or any interest
therein, except for the pledge thereof and security interest therein provided
for in this Agreement.
11. Further Assurances. The Pledgor will do all such acts, and will
furnish to the Lender all such financing statements, certificates, legal
opinions and other documents and will obtain all such governmental consents and
corporate approvals and will do or cause to be done all such other things as
the Lender may reasonably request from time to time in order to give full
effect to this Agreement and to secure the rights of the Lender hereunder, all
without any cost or expense to the Lender. The Pledgor hereby irrevocably
authorizes the Lender at any time and from time to time to file in any filing
office in any Uniform Commercial Code jurisdiction any initial financing
statements and amendments thereto that (a) indicate the Collateral as the Stock
Collateral (subject to the proviso to ss.1.1) or words of similar effect, or as
being of equal or lesser scope or in greater detail, and (b) contain any other
information required by part 5 of Article 9 of the Uniform Commercial Code of
the jurisdiction of the filing office for the sufficiency or filing office
acceptance of any financing statement or amendment, including whether the
Pledgor is an organization, the type of organization and any organization
identification number issued to the Pledgor. The Pledgor agrees to furnish any
such information to the Lender promptly upon request.
12. Lender's Exoneration. Under no circumstances shall the Lender be
deemed to assume any responsibility for or obligation or duty with respect to
any part or all of the Stock Collateral of any nature or kind or any matter or
proceedings arising out of or relating thereto, other than (a) to exercise
reasonable care in the physical custody of the Stock Collateral and (b) after a
Default or an Event of Default shall have occurred and be continuing to act in
a commercially reasonable manner. The Lender shall not be required to take any
action of any kind to collect, preserve or protect its or the Pledgor's rights
in the Stock Collateral or against other parties thereto. The Lender's prior
recourse to any part or all of the Stock Collateral shall not constitute a
condition of any demand, suit or proceeding for payment or collection of any of
the Obligations.
13. No Waiver, etc. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated except by a written instrument
expressly referring to this Agreement and to the provisions so modified or
limited, and executed by the Lender and the Pledgor. No act, failure or delay
by the Lender shall constitute a waiver of its rights and remedies hereunder or
otherwise. No single or partial waiver by the Lender of any default or right or
remedy that it may have shall operate as a waiver of any other default, right
or remedy or of the same default, right or remedy on a future occasion. The
Pledgor hereby waives presentment, notice of dishonor and protest of all
instruments, included in or evidencing any of the Obligations or the Stock
Collateral, and any and all other notices and demands whatsoever (except as
expressly provided herein or in the Credit Agreement).
14. Notice, etc. All notices, requests and other communications hereunder
shall be made in the manner set forth in ss.9.2 of the Credit Agreement.
15. Termination; Release. Upon final payment and performance in full of
the Obligations and the cancellation or termination of any commitment to extend
credit under the Credit Agreement or any of the other Loan Documents, this
Agreement shall terminate and the Lender shall, at the Pledgor's request and
expense, return such Stock Collateral in the possession or control of the
Lender as has not theretofore been disposed of pursuant to the provisions
hereof, together with any moneys and other property at the time held by the
Lender hereunder.
16. Overdue Amounts. Until paid, all amounts due and payable by the
Pledgor hereunder shall be a debt secured by the Stock Collateral and shall
bear, whether before or after judgment, interest at the rate of interest for
overdue principal set forth in the Credit Agreement.
17. Governing Law; Consent to Jurisdiction. THIS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK. The Pledgor agrees that any suit for the enforcement of this Agreement
shall be brought and maintained exclusively in the courts of the State of New
York or in the United States District Court for the Southern District of New
York; provided, however, that any suit seeking enforcement against any
collateral or other property may be brought, at the Lender's option, in the
courts of any jurisdiction where such collateral or other property may be
found. Pledgor consents to the non-exclusive jurisdiction of such court and to
service of process in any such suit being made upon the Pledgor by mail at the
address specified in ss.9.2 of the Credit Agreement. The Pledgor hereby waives
any objection that it may now or hereafter have to the venue of any such suit
or any such court or that such suit is brought in an inconvenient court.
18. Waiver of Jury Trial. THE PLEDGOR WAIVES ITS RIGHT TO A JURY TRIAL
WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION
WITH THIS AGREEMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF
ANY SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law, the Pledgor waives
any right which it may have to claim or recover in any litigation referred to
in the preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages. The
Pledgor (a) certifies that neither the Lender nor any representative, agent or
attorney of the Lender has represented, expressly or otherwise, that the Lender
would not, in the event of litigation, seek to enforce the foregoing waivers
and (b) acknowledges that, in entering into the Credit Agreement and the other
Loan Documents to which the is a party, the Lender is relying upon, among other
things, the waivers and certifications contained in this ss.18.
19. Miscellaneous. The headings of each section of this Agreement are for
convenience only and shall not define or limit the provisions thereof. This
Agreement and all rights and obligations hereunder shall be binding upon the
Pledgor and its respective successors and assigns, and shall inure to the
benefit of the Lender and its respective successors and assigns. If any term of
this Agreement shall be held to be invalid, illegal or unenforceable, the
validity of all other terms hereof shall be in no way affected thereby, and
this Agreement shall be construed and be enforceable as if such invalid,
illegal or unenforceable term had not been included herein. The Pledgor
acknowledges receipt of a copy of this Agreement.
20. Additional Pledgors. Upon the execution and delivery by any other
Person of a supplement in the form of Annex 1 hereto, such Person shall become
a "Pledgor" hereunder with the same force and effect as if it were originally a
party to this Agreement and named as a Pledgor hereunder. The execution and
delivery of such supplement shall not require the consent of any other Pledgor
hereunder, and the rights and obligations of each Pledgor hereunder shall
remain in full force and effect notwithstanding the addition of any new Pledgor
as a party to this Agreement.
IN WITNESS WHEREOF, intending to be legally bound, the Pledgor and the
Lender have caused this Agreement to be executed as of the date first above
written.
PC-EPHONE, INC., as Pledgor
By:
---------------------------------
Name:
Title:
PROCESS CONTROL (HOLDINGS) LIMITED,
as Lender
By:
---------------------------------
Name:
Title:
The undersigned Subsidiaries hereby join in the above Agreement for the
sole purpose of consenting to and being bound by the provisions of ss.ss.4.1, 6
and 7 thereof, the undersigned hereby agreeing to cooperate fully and in good
faith with the Lender and the Pledgor in carrying out such provisions.
PC-EPHONE LTD.
By:
---------------------------------
Name:
Title:
PC-ESOLUTIONS INC.
By:
---------------------------------
Name:
Title:
PC-EPHONE CANADA ENTERPRISES, INC.
By:
---------------------------------
Name:
Title:
ANNEX A TO STOCK PLEDGE AGREEMENT
None of the issuers has any authorized, issued or outstanding shares of
its capital stock of any class or any commitments to issue any shares of its
capital stock of any class or any securities convertible into or exchangeable
for any shares of its capital stock of any class except as otherwise stated in
this Annex A.
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Number of Number of Number of Par or
Record Class of Authorized Issued Outstanding Liquidation
Issuer Owner Shares Shares Shares Shares Value
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PC-eSolutions, PC-ePhone, Common Stock 1000 100 100 $.0001 par
Inc. Inc. value per
share
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PC-EPhone PC-EPhone, Common Shares 100 100 no par value
Canada Inc.
Enterprises,
Inc.
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Peace for the Newlands Oil Common Shares 12,000 12,000 $1.00 U.S.
New Millenium & Gas Inc. par value
Ltd. (now (now renamed per share.
renamed PC-EPhone,
PC-EPhone Ltd. Inc.)
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ANNEX I
to the Stock Pledge Agreement
This SUPPLEMENT, dated as of ____________ __, ____ (this "Supplement"), is
to the Stock Pledge Agreement, dated as of April 8, 2002 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
"Stock Pledge Agreement"), among the Pledgors (such capitalized term, and other
terms used in this Supplement, to have the meanings set forth in the preamble
and Section 2 of the Stock Pledge Agreement) from time to time party thereto,
in favor of Process Control (Holdings) Limited, as Lender (the "Lender").
W I T N E S S E T H:
WHEREAS, pursuant to the provisions of Section 20 of the Stock Pledge
Agreement, each of the undersigned is becoming a Pledgor under the Stock Pledge
Agreement; and
WHEREAS, each of the undersigned desires to become a "Pledgor" under
the Stock Pledge Agreement in order to induce the Lender to continue to extend
loans under the Credit Agreement;
NOW, THEREFORE, in consideration of the premises, and for other
consideration (the receipt and sufficiency of which is hereby acknowledged),
each of the undersigned agrees, for the benefit of the Lender, as follows:
Party to Stock Pledge Agreement, etc. In accordance with the terms of the
Stock Pledge Agreement, by its signature below each of the undersigned hereby
irrevocably agrees to become a Pledgor under the Stock Pledge Agreement with
the same force and effect as if it were an original signatory thereto and each
of the undersigned hereby (a) agrees to be bound by and comply with all of the
terms and provisions of the Stock Pledge Agreement applicable to it as a
Pledgor and (b) represents and warrants that the representations and warranties
made by it as a Pledgor thereunder are true and correct as of the date hereof.
In furtherance of the foregoing, each reference to a "Pledgor" and/or
"Pledgors" in the Stock Pledge Agreement shall be deemed to include each of the
undersigned.
Representations. Each of the undersigned Pledgors hereby represents and
warrants that this Supplement has been duly authorized, executed and delivered
by it and that this Supplement and the Stock Pledge Agreement constitute the
legal, valid and binding obligation of each of the undersigned, enforceable
against it in accordance with its terms.
Full Force of Guaranty. Except as expressly supplemented hereby, the Stock
Pledge Agreement shall remain in full force and effect in accordance with its
terms.
Severability. Wherever possible each provision of this Supplement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Supplement shall be prohibited by or invalid under
such law, such provision shall be ineffective to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Supplement or the Stock Pledge Agreement.
Indemnity; Fees and Expense, etc. Without limiting the provisions of any
other Loan Document, each of the undersigned agrees to reimburse the Lender for
its reasonable out-of-pocket expenses incurred in connection with this
Supplement, including reasonable attorney's fees and expenses of the Lender's
counsel.
Governing Law, Entire Agreement, etc. THIS SUPPLEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. This
Supplement and the other Loan Documents constitute the entire understanding
among the parties hereto with respect to the subject matter thereof and
supersede any prior agreements, written or oral, with respect thereto.
Counterparts. This Supplement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this
Supplement to be duly executed and delivered by its officer thereunto duly as
authorized of the date first above written.
[NAME OF ADDITIONAL PLEDGOR]
By:
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Title:
[NAME OF ADDITIONAL PLEDGOR]
By:
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Title:
ACCEPTED AND AGREED TO:
PROCESS CONTROL (HOLDINGS) LIMITED,
as Lender
By:
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Title:
