STOCK PLEDGE AGREEMENT
EXHIBIT
10.2
This
Stock Pledge Agreement (the “Agreement”),
dated
as of March 14, 2006, is entered into by and between Equitex,
Inc.,
a
Delaware corporation (the
“Pledgor”),
and FastFunds
Financial Corporation,
a
Nevada Corporation (“FastFunds”).
FastFunds is referred to herein as the “Lender”.
W
I T N E
S S E T H
WHEREAS,
the
Lender and Pledgor have entered into a Promissory Note dated
as
of this date (the "Note"),
pursuant to which, among other things, the Lender is purchasing a secured
promissory note in consideration of a $5,000,000 loan (the “Loan”);
WHEREAS,
the
Pledgor has agreed to pledge certain of its assets to the Lender.
WHEREAS,
the
execution of this Agreement is a condition precedent to the obligation of the
Lender to perform its obligations under the Note.
NOW,
THEREFORE,
in
consideration of the premises and mutual covenants herein contained, and in
further consideration of the Loan to the Pledgor, the parties hereby agree
as
follows:
Section
1
- Pledge.
The
Pledgor hereby pledges and assigns to the Lender, and grants to the Lender
a
continuing security interest in, the following (the “Pledged
Collateral”):
(i) The
stock
described in Schedule 1 attached hereto (the “Pledged
Shares”)
and
the certificates representing the Pledged Shares, and all dividends (whether
stock dividends or cash dividends), and cash, instruments and other property
from time to time received, receivable or otherwise distributed in respect
of or
in exchange for any or all of the Pledged Shares;
(ii) All
additional shares of stock of the issuer of the Pledged Shares from time to
time
acquired by the Pledgor by stock split or by the exercise of any conversion
or
option rights, and the certificates representing such additional shares, and
all
dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or
all
of such shares; and
(iii) Any
and
all proceeds of any of the foregoing upon the sale or other disposal of the
foregoing for any reason.
Section
2
- Security
for Obligations.
This
Agreement secures the payment and performance of all obligations of the Pledgor
pursuant to the Note.
Section
3
- Further
Assurances.
The
Pledgor agrees that at any time and from time to time, at the expense of the
Pledgor, the Pledgor will promptly execute and deliver all further instruments
and documents, and take all further action, that may be reasonably necessary
or
desirable, or that the
Lender
may reasonably request, in order to perfect and protect any security interest
granted or purported to be granted hereby or to enable the Lender to exercise
and enforce its respective rights and remedies hereunder with respect to any
Pledged Collateral.
Section
4
- Voting
Rights; Dividends; Etc.
So long
as no Event of Default (as defined in the Note) exists and is
continuing:
(i) The
Pledgor shall be entitled to exercise any and all voting and other consequential
rights pertaining to the Pledged Collateral or any part thereof for any purpose
not inconsistent with the terms of this Agreement or the Loan documents;
provided,
however,
that,
prior to exercising any material right as a shareholder, the Pledgor shall
first
give the Lender at least five days’ written notice of the manner in which the
Pledgor intends to exercise, or the reasons for refraining from exercising,
any
right as a shareholder and shall not exercise any such right if the exercise
of
such right could constitute an Event of Default.
(ii) The
Pledgor shall be entitled to receive and retain any and all cash dividends
paid
in respect of the Pledged Collateral that may be permitted under and in
accordance with the Loan documents.
Section
5
- Transfers
and Other Liens; Additional Shares.
The
Pledgor agrees that it will not sell, transfer or otherwise dispose of, or
grant
any option to buy or sell with respect to, any of the Pledged Collateral, or
create or permit to exist any lien, security interest, or other charge or
encumbrance upon or with respect to any of the Pledged Collateral, except for
the security interest under this Agreement, without the prior written consent
of
the Lender.
Section
6
- Lender
Appointed Attorney-in-Fact.
The
Pledgor hereby appoints the Lender attorney-in-fact, with full authority in
the
place and stead of the Pledgor and in the name of the Pledgor or otherwise,
to
take any action and to execute any instrument which such Lender may deem
necessary or advisable to accomplish the purposes of this Agreement, including,
without limitation, upon and during the continuation of any Event of Default
(as
defined in the Note), to receive, endorse and collect all instruments made
payable to the Pledgor representing any dividend, interest payment or other
distribution in respect of the Pledged Collateral or any part thereof and to
give full discharge for the same. The Pledgor covenants and agrees to execute
any further power-of-attorney that may, as determined in such Lender’s
reasonable discretion, be necessary or advisable to appoint the Lender as the
Pledgor’s attorney-in-fact as set forth in this Section 6.
Section
7
- Remedies
upon Default.
If any
Event of Default (as defined in the Note) shall have occurred and be
continuing:
(a) Upon
written notice from the Lender, the right of Pledgor to receive dividends and
to
vote the shares shall cease, and all such rights shall become vested in such
Lender. In addition to other rights and remedies provided for herein or
otherwise available to it, the Lender may exercise all the rights and remedies
of a secured party on default under the Uniform Commercial Code in effect in
the
State of Delaware at that time, and the Lender may also, without notice except
as specified below, sell the Pledged Collateral or any part thereof, in
accordance with and subject to applicable law, for cash, on credit or for future
delivery, and upon such other terms as are
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commercially
reasonable. The Lender shall not be obligated to make any sale of Pledged
Collateral regardless of notice of sale having been given.
(b) Any
cash
held by the Lender as Pledged Collateral and all cash proceeds received by
such
Lender from any sale of or collection from all or any part of the Pledged
Collateral, may be held by such Lender as collateral for, and/or be applied
in
whole or in part by such Lender against, all or any part of the Obligations
of
the Pledgor under the Loan Documents (in the manner as provided in the Loan
Documents). Any surplus of such cash or cash proceeds held by the Lender and
remaining after payment in full of all the Obligations shall be paid to the
Pledgor.
Section
8
- Enforcement
Rights.
If the
Lender shall determine to exercise its right hereunder to sell all or any of
the
Pledged Collateral, the Pledgor agrees that, upon request of the Lender, the
Pledgor will do or cause to be done all such other acts and things as may be
reasonably necessary to make such sale of the Pledged Collateral or any part
thereof valid and binding and in compliance with applicable law.
Section
9
- Security
Interest Absolute.
All
rights of the Lender and security interests hereunder, and all obligations
of
the Pledgor hereunder, shall be absolute and unconditional irrespective
of:
(i) any
lack
of validity or enforceability of the Obligations or any agreement or instrument
relating thereto;
(ii) any
change in the time, manner or place of payment of, or in any other term of,
all
or any of the Obligations, or any amendment or waiver or any consent to any
departure from the Note or any of the other Loan Documents;
(iii) 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 Obligations of the Pledgor under the Loan
Documents;
or
(iv) any
other
circumstance which might otherwise constitute a defense available to, or a
discharge of, the Pledgor, any other party to the Loan Documents, or a third
party obligor except for such waivers as are required by applicable law and
cannot be waived under applicable law.
Section
10 - Amendment.
No
amendment or waiver of any provisions of this Agreement shall be effective
unless the same shall be in writing and signed by the Lender and the Pledgor,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
Section
11 - Continuing
Security Interest; Transfer of Note(s).
This
Agreement shall create a continuing security interest in the Pledged Collateral
and shall (i) remain in full force and effect until payment in full of the
Obligations (other than contingent indemnity obligations), (ii) be binding
upon
the Pledgor, its successors, legal representatives, estate, heirs, devisees,
legatees and assigns, and (iii) inure to the benefit of the Lender and its
successors, permitted transferees and permitted assigns. Upon the payment and
performance in full of the Obligations of the Pledgor
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under
the
Loan Documents, the Lender shall deliver such of the Pledged Collateral as
shall
not have been sold or otherwise applied pursuant to the terms hereof to the
Pledgor.
Section
12 - Governing
Law; Terms.
This
Agreement shall be governed by the laws of the State of Colorado, without regard
to the choice of law provisions thereof. Unless otherwise defined herein,
capitalized terms used herein shall have the respective meanings given in the
Loan document.
Section
13 - Expenses.
The
Pledgor will upon demand pay to the Lender the amount of any and all reasonable
costs and expenses, including the reasonable fees and expenses of its counsel
and of any experts and agents, which such Lender may incur in connection with
(i) the custody or preservation of, or the sale, collection from, or other
realization upon, any of the Pledged Collateral, (ii) the exercise or
enforcement of any of the rights of the Lender hereunder or (iii) the failure
by
the Pledgor to perform or observe any of the provisions hereof.
Section
14 - Representations
and Warranties.
The
Pledgor represents and warrants, which representations and warranties shall
survive the execution and delivery of this Agreement, that:
(a) The
Pledgor is the direct and beneficial owner of the Pledged Shares, and the
Pledged Collateral is owned by the Pledgor free and clear of any lien, security
interest, charge or encumbrance.
(b) The
execution, delivery and performance by Pledgor of this Agreement has been duly
authorized, does not require the consent of any governmental body or other
regulatory authority, and will not violate, conflict with or result in a breach
of any provision of any agreement, indenture or other instrument to which the
Pledgor is a party or is bound by.
(c) None
of
the Pledged Shares has been issued or transferred in violation of any applicable
federal and state securities laws.
(d) There
are
no options, warrants, calls, conversion rights or other similar commitments
relating to the Pledged Shares.
Section
15 - Notices.
All
notices and other communications under this Agreement shall be in writing and
deemed to have been given: (a) when made if personally delivered by hand (with
written confirmation of receipt); (b) on the date received if sent via national
overnight courier; or (c) when receipt is acknowledged by the receiving party
if
sent via facsimile or electronic mail, addressed to the address of such party
as
follows:
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If
to the
Pledgor:
Equitex,
Inc.
0000
Xxxx
Xxxxxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxxxx 00000
Attention:
Xxxxx Xxxx, President
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Email:
xxxxx@xxxxxxx.xxx
If
to the
Lender, in care of:
FastFunds
Financial Corporation
00000
Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx,
XX 00000
Attention:
Xxxxxxx Xxxxxxx, Chief Executive Officer
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Email:
xxxxxxxx@xxxxxx.xxx
[Signature
Page Follows]
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IN
WITNESS WHEREOF,
the
undersigned have executed and delivered this Stock Pledge Agreement as of the
date first above written.
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PLEDGOR:
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Equitex,
Inc.
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By:
/s/
Xxxxx Xxxx
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Xxxxx
Xxxx, President
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LENDER:
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FastFunds
Financial Corporation
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By:
/s/
Xxxxxxx X. Xxxxxxx
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Xxxxxxx
X. Xxxxxxx, Chief Executive Officer
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