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EXHIBIT 5
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT is made effective the 28th day of
November, 1997, (the "Effective Date") by XXXXXX XXXXX and XXXXXXX XXXXXXX,
jointly and severally as "Pledgors," KARNO, SCHWARTZ, XXXXXXXX, XXXXXXX &
XXXXXX, A Partnership Including Professional Corporations as "Pledge Holder,"
and XXXXXX X. XXXXXXXXX and XXXXXXX MAY XXXXXXX as "Pledgees".
1. PLEDGE. Pledgors hereby deposit with Pledge Holder and do
hereby, as of the Effective Date, pledge to Pledgees, as collateral security
for the payment in full, faithful, true and exact performance and observance of
all of the covenants and conditions of Pledgors as Makers of that certain
Promissory Note of even date herewith in the original principal amount of
$180,000, including but not limited to the payment, in full, of all such
indebtedness and any interest thereon, and other sums payable to Pledgees upon
or with respect to such indebtedness (collectively, the "Obligations"),
Pledgors' property (the "Collateral") described as
All of Pledgors' shares, but not less than 399,901 shares, of
the common stock of Radius, Inc., a California corporation
("Radius"), whether held in the name of either of Pledgors or
held in the name of any other person or entity for the benefit
of Pledgors, or either of them, including but not limited to
any and all shares of Radius common stock acquired by Pledgors
or any other person or entity for the benefit of Pledgors, or
either of them at any time and from time to time after the
date hereof.
2. PRIORITY OF PLEDGE. The within pledge is, or will be upon
the acquisition of such shares by Pledgors, a first priority lien on such
shares.
3. POWER OF SALE ON DEFAULT. Pledgors hereby authorize and
empower Pledgees, upon any default of any one or more of the Pledgors in the
prompt payment or due performance of any of the Obligations, at their option
and without notice to Pledgors, except as specifically herein provided, to
collect, sell, assign and deliver, the whole or any part of the Collateral, and
to execute, on Pledgors' behalf all documents required in connection therewith,
including but not limited to any Assignment Separate From Certificate, or any
substitute therefor, or any additional thereto, at public or private sale, for
cash, upon credit, or for future delivery, without the necessity of the
Collateral being present at any such sale, or in view of prospective purchasers
thereof, and without any presentment, demand for performance, protect, notice
of protest, or notice of dishonor, or advertisement, any such demand or
advertisement being expressly waived. Pledgees shall give Pledgors, and each
of them, and the Pledge Holder, ten (10) days' notice by United States mail,
postage prepaid, at the addresses specified herein, of the time and place of
any public or private sale. Upon such sale, Pledgees may become the purchaser
of the whole or any part of the Collateral sold, discharged from all claims and
free from any right of redemption. The foregoing is hereby made subject to the
following provisions, to wit: That Pledgees shall include in such notice of
the time and place of such sale a statement of the grounds upon which
default(s) is (are) based; and, that during such ten-day period, Pledgors, or
any one
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or more of them, may cure such default, in which event said sale shall not be
held and it shall be deemed that no such default occurred.
4. APPLICATION OF PROCEEDS. In case of any sale, transfer or
disposal of the Collateral, whether pursuant to a sale by Pledgees under
Paragraph 3 above, or any sale of all or any portion of Pledgors' interest in
the Collateral (including but not limited to the sale of any call option with
respect to the Collateral), Pledgors covenant and agree that the proceeds
thereof shall first be applied to the payment of the expenses of such sale,
commissions, attorneys' fees and all charges paid or incurred by Pledge Holder
hereunder; second, to the payment of the expenses of such sale, commissions,
attorneys' fees and all charges paid or incurred by Pledgees pertaining to
sale, including any taxes or other charges imposed by law upon the Collateral
and/or the owning, holding or transferring thereof; third, to pay, satisfy and
discharge the Note and any other indebtedness arising out of or under this
Stock Pledge Agreement; fourth, to pay, satisfy and discharge the duties and
obligations of Pledgors pursuant to any Stock Pledge Agreement hereafter
executed by Pledgors with Pledgees' consent, junior to this Stock Pledge
Agreement, and the respective indebtedness secured thereby, in the order of
their respective priority; and fifth, to pay the surplus, if any, to Pledgors.
5. ADDITIONAL RIGHTS OF PLEDGEES. Pledgees specifically and
expressly reserve the right and remedy to disregard the security hereof, and to
xxx on the principal obligation secured hereby, and expressly declare that
their remedies upon this Stock Pledge Agreement, to cause the sale of the
collateral at public or private sale in the manner as hereinabove set forth, or
to bring an action of foreclosure and have the Collateral sold at judicial
sale, are cumulative, and in addition to all other remedies that they may
possess under the Uniform Commercial Code. Pledges shall have the right to
recover, as a part of any judgment in an action of foreclosure, commissions,
attorneys' fees, and all charges and expenses paid or incurred by them in
connection with any such foreclosure sale. Subject to the provisions of
paragraph 8 of the Promissory Note secured hereby, Pledgees reserve the right
to recover any deficiency judgment arising from such sale or sales, whether
judicial or by way of pledge sale.
6. ADDITIONS TO COLLATERAL. Any stock rights, and rights to
subscribe, cash dividends, liquidating dividends, stock dividends, dividends
paid in stock, new securities, or other property, which Pledgors may hereafter
become entitled to receive on account of the Collateral, shall be and become a
part of the Collateral, and in the event that Pledgors shall receive any such,
they represent, warrant, covenant and agree that they will immediately deliver
it to the Pledge Holder to be held by it in the same manner as the Collateral
originally pledged hereunder.
7. INDEMNITY. In case of any adverse claims in respect to the
Collateral or any portions thereof, arising out of any act done or suffered by
Pledgors, the Pledgors promise and agree to hold harmless and to indemnify
Pledge Holder and Pledgees from and against any losses, liabilities, damages,
expenses, costs and reasonable attorneys' fees incurred in or about defending,
protecting, or prosecuting the security interests hereby created.
8. ADVANCES TO PROTECT COLLATERAL. Pledgors agree to pay, prior
to delinquency, all taxes, liens and assessments against the Collateral, and
upon their failure to do so, Pledgees, at their option, may pay any of them,
and shall be the sole judge of the legality or validity thereof and the amount
necessary to discharge same, and Pledgors' failure to pay same shall be a
default hereunder and the sums so advanced shall be due and payable to Pledgees
together with interest thereon at the rate of twelve percent (12%) per annum
until fully repaid.
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9. NON-WAIVER. Any forbearance or failure or delay by Pledgees
in exercising any right, power or remedy hereunder shall not be deemed to be a
waiver of such right, power or remedy, and any single or partial exercise of
any right, power or remedy of Pledgees shall continue in full force and effect
until such right, power or remedy is specifically waived by an instrument in
writing, executed by Pledgees.
10. RELEASE OF COLLATERAL. When the Obligations shall have been
fully performed and satisfied and Pledgees shall have received payment in full
of all other sums owed hereunder, then, and only then, this Stock Pledge
Agreement shall be canceled and of no further force and effect, and Pledge
Holder shall thereupon deliver to the respective Pledgors the Collateral free
and clear of the lien of this pledge.
11. VOTING RIGHTS. During the term of this Stock Pledge
Agreement and so long as the Pledgors, and each of them, are not in default
under the Obligations, the respective Pledgors shall have the right to vote any
shares of stock pledged hereby on all corporate questions. The foregoing
notwithstanding, Pledgors agree not to vote their shares of Radius stock, in
any manner which would result in a liquidation, dissolution or merger of Radius
until such time as the Obligations are wholly satisfied.
12. SUCCESSOR PLEDGE HOLDER-LIMITATION ON LIABILITY. In the
event that the Pledge Holder becomes incapacitated due to dissolution or
disability so that it is no longer able to act as Pledge Holder, Xxxxxxx X.
Xxxxxxxx, A Professional corporation, shall thereupon be the Successor Pledge
Holder. Pledgors hereby acknowledge that the Pledge Holder and the Successor
Pledge Holder are affiliated with one another and have heretofore acted as
legal counsel to one or both of Pledgees and after consulting with independent
legal counsel, hereby waive all conflicts of interest arising out of Pledge
Holder's and/or the Successor Pledge Holder's performance of its obligations
hereunder. Pledge Holders shall only be liable to Pledgors for its acts of
gross negligence or willful misconduct.
13. PLEDGORS' REPRESENTATION AND WARRANTIES. Pledgors each
represent and warrant that (i) Pledgors now own the collateral, (ii) Pledgors
have not heretofore sold, transferred, conveyed, hypothecated or otherwise
assigned any of their interest in the Collateral to any other person or entity,
(iii) unless and until the Obligations have been fully discharged, each of them
will not (a) issue any replacement stock certificate with respect to the
Collateral, or (b) make any further assignment or pledge of the Collateral, all
without Pledgees' prior written consent.
14. CONSTRUCTION. This Agreement, and all of the rights and
duties in connection therewith, shall be governed by the laws of the State of
Florida, the state in which the loan evidenced by the Note was made, and the
state in which Pledgors maintain their principal residences.
15. NOTICE. Any notice, report or writing required or permitted
to be given hereunder shall be in writing and shall be served by delivering the
same personally either to the other party, or to the agents, officers or other
representatives thereof hereinbelow designated, if any, or by depositing the
notice, contained in a sealed envelope, postage prepaid, in the United States
Postal System as registered or certified mail, with return receipt requested or
as Express Mail. Any and all such notices shall be delivered to the parties at
their respective addresses specified in this paragraph. Any such notice
deposited in the mail shall be conclusively deemed delivered to and received by
the addressee two (2) business days after the deposit in the mail as registered
or certified mail, return receipt requested, or one (1) business day after
deposit in the mail as Express Mail if all of the foregoing conditions of
notice shall
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have been satisfied and if such notice shall at the time of mailing have been
contained in an envelope addressed as follows:
To Pledgors: Xxxxxx Xxxxx and Xxxxxxx Xxxxxxx
000 Xxxxxxxxx Xxxxxx, #0
Xxxxxxxxxx, Xxxxxxx 00000
To Pledgee: Xxxxxx X. Xxxxxxxxx and
Xxxxxxx Xxxx Xxxxxxx
0000 Xxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx 00000
To Pledge Holder: Karno, Schwartz, Xxxxxxxx,
Xxxxxxx & Xxxxxx
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Any party hereto may change its address for the purposes of this paragraph by
giving such other party notice, as provided for herein, of the new address.
16. COUNTERPARTS. This Stock Pledge Agreement may be executed in
counterparts; each thereof is hereby declared to be an original; all, however,
shall constitute but one and the same agreement.
17. HEIRS AND SUCCESSORS. This Stock Pledge Agreement and all of
its terms and provisions shall be binding upon the heirs, successors,
transferees and assigns of each of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Stock Pledge
Agreement effective the date first hereinabove set forth.
PLEDGORS:
/s/ Xxxxxx Xxxxx
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XXXXXX XXXXX
/s/ Xxxxxxx Xxxxxxx
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XXXXXXX XXXXXXX
PLEDGEE:
/s/ Xxxxxx X. Xxxxxxxxx
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XXXXXX X. XXXXXXXXX
/s/ Xxxxxxx Xxxx Xxxxxxx
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XXXXXXX XXXX XXXXXXX
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PLEDGE HOLDER:
KARNO, SCHWARTZ, XXXXXXXX,
XXXXXXX & XXXXXX, A Partnership
Including Professional Corporations
By: XXXXXXX X. XXXXXXXX, A
Professional Corporation,
General Partner
By:/s/ Xxxxxxx X. Xxxxxxxx
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XXXXXXX X. XXXXXXXX,
President
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