FIRST AMENDMENT
TO
PLEDGE AND SECURITY AGREEMENT
WHEREAS, The Classica Group, Inc., a New York corporation, having an
address at 0000 Xxxx Xxxxxx, Xxxxx 00, Xxxxxxxxxx, Xxx Xxxxxx 00000 (the
"Pledgor"), and Pinnacle Investment Partners, L.P., a New York limited
partnership, having an address at 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (the "Secured Creditor"), have previously executed and delivered that
certain Pledge and Security Agreement, dated as of June 10, 2003 (the
"Agreement"), pursuant to which the Pledgor has delivered to the Escrow Agent
certificates representing 770,000 shares of the Pledgor's common stock, together
with stock powers executed in blank; and
WHEREAS, the Pledgor and the Secured Creditor wish to amend the
Agreement to set forth their intent regarding the status of the 770,000 shares.
NOW THEREFORE, in consideration of the premises and the agreements
herein, the parties hereto agree as follows:
1. Capitalized terms used herein without definition shall have the meanings
ascribed thereto in the Agreement.
2. (A) The parties hereto agree that it is their intent that the 770,000 shares
that have been pledged to the Secured Creditor pursuant to the terms of the
Agreement shall not be deemed issued or outstanding, and that accordingly,
Section 1(a) of the Agreement shall be deleted in its entirety and replaced with
the following:
"(a) Certificates representing 770,000 shares of Pledgor's
common stock, which share certificates, together with stock powers
executed in blank, have been delivered to and placed in escrow with the
Secured Creditor's counsel, Xxxxxx & Xxxxx LLP; and"
(B) The parties hereto further agree that Section 5(a) of the Agreement
shall be deleted in its entirety and replaced with the following:
"(a) The Secured Creditor may exercise in respect of the
Pledged Collateral, in addition to other rights and remedies provided for herein
or otherwise available to it, all of the rights and remedies of a secured party
on default under the Commercial Code then in effect in the State of New York,
and without limiting the generality of the foregoing, and without notice except
as specified below, sell the Pledged Collateral or any part thereof. Prior to
selling the Pledged Collateral or any part thereof, and in addition to any other
notice provisions that may be required by this Agreement, the Securities
Purchase Agreement, or the Note, the Secured Creditor shall notify the Pledgor
of the number of shares of the Pledgor's common stock that the Secured Creditor
wishes to sell. Such shares shall then be deemed issued and outstanding."
3. All other provisions of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have caused this First Amendment to the
Pledge and Security Agreement to be executed and delivered as of this 23rd day
of June 2003.
THE CLASSICA GROUP, INC. PINNACLE INVESTMENT PARTNERS, L.P.
By: ________________________ By:_______________________________
Xxxxx X. Xxxxxxxx, CEO
