STOCK PLEDGE AGREEMENT
STOCK
PLEDGE AGREEMENT (this “Agreement”), effective as of November 29, 2006, is by
and among Bio Solutions Manufacturing, Inc., a New York corporation (the
“Pledgor”), and the parties set forth on the signature page hereto and their
endorsees, transferees, and assigns (each a “Pledgee” and, collectively, the
“Pledgees”).
W I T N E S S E T H
WHEREAS,
pursuant to the Loan Agreement dated the date hereof between the Pledgor
and the
Pledgees, (i) the Pledgees have agreed to amend and restate certain obligations
relating to advances previously made by the Pledgees on behalf of the Pledgor
(the “Amended Notes”) and (ii) the Pledgees have agreed from time to time to
loan to Pledgee certain principal amounts (collectively, the “Loans”), which
shall be evidenced by a secured convertible promissory note (the “Note”,
together with the Amended Notes, the “Notes”). The principal amount outstanding
and interest payable under the Notes is convertible into shares of the Pledgee’s
common stock, $0.001 par value (the “Common Stock”). In connection with the
transactions contemplated by the Loan Agreement, Pledgor and the Pledgees
have
entered into the Loan Agreement, dated the date hereof (the “Loan Agreement”);
and
WHEREAS,
as a material inducement to Pledgees to provide loans evidenced by the Notes
to
Pledgor, Pledgees have required and Pledgor has agreed to grant to Pledgees
a
security interest in all of the outstanding capital stock of (i) Bio Extraction
Services, Inc., a New York corporation currently owned by Pledgor (the “BESI
Shares”) and (ii) Bio Solutions Productions, Inc., a Nevada corporation
currently owned by Pledgor (the “BSP Shares”, together with the BESI shares, the
“Shares”), as collateral security for the timely and full satisfaction of all
obligations of Pledgor, whether matured or unmatured, now or hereafter existing
or created and becoming due and payable, under the Transaction Documents
(as
defined in the Note) and this Agreement (such obligations are collectively
referred to herein as the “Obligations”).
NOW,
THEREFORE, in consideration of the foregoing recitals, and the mutual covenants
contained herein, the parties hereby agree as follows:
1. Security.
As
collateral security for the due and punctual payment and performance, when
due,
by each of the Pledgor of all the Obligations, Pledgor, hereby pledges with,
hypothecates, transfers and assigns to Pledgees, their successors and assigns,
all of the Shares and all proceeds, shares and other securities received,
receivable or otherwise distributed in respect of or in exchange for the
Shares,
including, without limitation, any shares and other securities into which
such
Shares are convertible or exchangeable (collectively referred to as the
“Collateral”). Simultaneously herewith, Pledgor shall deliver to Pledgees the
certificates representing the Shares, stamped with a bank medallion guarantee,
along with a stock transfer power duly executed in blank by Pledgor, to be
held
by Pledgees as security. Any other Collateral received by Pledgor shall also
be
delivered to Pledgees together with any executed stock powers or other transfer
documents requested by Pledgees, which request may be made at any time prior
to
the date when the Obligations shall have been paid and otherwise satisfied
in
full.
2. Voting,
Power, Dividends, Etc. and other Agreements.
(a) Unless
and until an Event of Default as set forth in Section 3 hereof has occurred,
Pledgor shall be entitled to:
(i) exercise
all voting and/or consensual powers pertaining to the Shares or other
Collateral, or any part thereof, for all purposes;
(ii) receive
and retain dividends paid with respect to the Shares or other Collateral;
and
(iii) receive
the benefits of any income tax deductions available to Pledgor as a shareholder
of BESI and BSP.
(b) Pledgor
agrees that it will not sell, assign, transfer, pledge, hypothecate, encumber
or
otherwise dispose of any of the Shares.
(c) Pledgor
agrees to pay all costs including all reasonable attorneys’ fees and
disbursements incurred by Pledgee in enforcing this Agreement in accordance
with
its terms.
3. Default
and Remedies.
(a) For
the
purposes of this Agreement “Event of Default” shall mean:
(i) default
in or under any of the Obligations after the expiration, without cure, of
any
applicable cure period; or
(ii) a
breach
by Pledgor of any of its representations or warranties in this Agreement
or in
any the Transaction Documents; or
(iii) the
occurrence of a Triggering Event under any Note.
(b) Pledgees
shall have the following rights upon any Event of Default and for so long
as the
Obligations are not satisfied in full:
(i) the
rights and remedies provided by the Uniform Commercial Code as adopted by
the
State of New York (the “UCC”)(as said law may at any time be
amended);
(ii) the
right
to receive and retain all dividends, payments and other distributions of
any
kind upon any or all of the Shares or other Collateral;
(iii) the
right
to cause any or all of the Shares or other Collateral to be transferred to
its
own name or to the name of its designee and have such transfer recorded in
any
place or places deemed appropriate by Pledgees; and
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(iv) the
right
to sell, at a public or private sale, the Collateral or any part thereof
for
cash, upon credit or for future delivery, and at such price or prices in
accordance with the UCC (as such law may be amended from time to time). Upon
any
such sale, Pledgees shall have the right to deliver, assign and transfer
to the
purchaser thereof the Collateral so sold. Pledgees shall give the Pledgor
not
less than ten (10) days’ written notice of its intention to make any such sale.
Any such sale shall be held at such time or times during ordinary business
hours
and at such place or places as Pledgees may fix in the notice of such sale.
Pledgees may adjourn or cancel any sale or cause the same to be adjourned
from
time to time by announcement at the time and place fixed for the sale, and
such
sale may be made at any time or place to which the same may be so adjourned.
In
case of any sale of all or any part of the Collateral upon terms calling
for
payments in the future, any Collateral so sold may be retained by Pledgees
until
the selling price is paid by the purchaser thereof, but Pledgees shall incur
no
liability in the case of the failure of such purchaser to take up and pay
for
the Collateral so sold and, in the case of such failure, such Collateral
may
again be sold upon like notice. Pledgees, however, instead of exercising
the
power of sale herein conferred upon it, may proceed by a suit or suits at
law or
in equity to foreclose the security interest and sell the Collateral, or
any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction, the Pledgor having been given due notice of all such action.
Pledgees shall incur no liability as a result of a sale of the Collateral
or any
part thereof. All proceeds of any such sale, after deducting the reasonable
expenses and reasonable attorneys’ fees incurred in connection with such sale,
shall be applied in reduction of the Obligations, and the remainder, if any,
shall be paid to Pledgor.
4. Application
of Proceeds; Release.
The
proceeds of any sale or enforcement of or against all or any part of the
Collateral, and any other cash or collateral at the time held by Pledgees
hereunder, shall be applied by Pledgees first to the payment of the reasonable
costs of any such sale or enforcement, then to reimburse Pledgees for any
damages, costs or expenses incurred by Pledgees as a result of an Event of
Default, then to the payment of the principal amount of, and interest and
any
other payments due in respect of, the Obligations. The remainder, if any,
shall
be paid to Pledgor. As used in this Agreement, “proceeds” shall mean cash,
securities and other property realized in respect of, and distributions in
kind
of, the Collateral, including any thereof received under any reorganization,
liquidation or adjustment of debt of any issuer of securities included in
the
Collateral.
5. Representations
and Warranties.
Pledgor
hereby represents and warrants to Pledgees that:
(i) Pledgor
has full power and authority and legal right to pledge the Collateral to
Pledgees pursuant to this Agreement and this Agreement constitutes a legal,
valid and binding obligation of Pledgor enforceable in accordance with its
terms;
(ii) the
execution, delivery and performance of this Agreement and other instruments
contemplated herein will not violate any provision of any order or decree
of any
court or governmental instrumentality or of any mortgage, indenture, contract
or
other agreement to which the Pledgor is a party or by which the Pledgor and
the
Collateral may be bound, and will not result in the creation or imposition
of
any lien, charge or encumbrance on, or security interest in, any of the
Pledgor’s properties pursuant to the provisions of such mortgage, indenture,
contract or other agreement;
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(iii) Pledgor
is the sole owner of the Collateral free and clear of all liens, charges,
encumbrances, or security interests and the Shares have been duly authorized
and
validly issued, fully paid and non-assessable; and
(iv) the
Pledgor is duly organized, validly existing and in good standing under the
laws
of the jurisdiction of its organization.
6. No
Waiver; No Election of Remedies.
No
failure on the part of Pledgees to exercise, and no delay in exercising,
any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise by Pledgees of any right, power, or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power, or remedy. The remedies herein provided are cumulative and
are not
exclusive of any remedies provided by law. In addition, the exercise of any
right or remedy of Pledgees at law or equity or under this Agreement or any
of
the documents shall not be deemed to be an election of Pledgees’ rights or
remedies under such documents or at law or equity.
7. Termination.
This
Agreement shall terminate when all of the Obligations shall have been paid
and
otherwise satisfied in full.
8. Further
Assurances.
The
parties hereto agree that, from time to time upon the written request of
any
party hereto, they will execute and deliver such further documents and do
such
other acts and things as such party may reasonably request in order fully
to
effect the purposes of this Agreement.
9. Miscellaneous.
(a) Modification.
This
Agreement contains the entire understanding between the parties with respect
to
the subject matter hereof and specifically incorporates all prior oral and
written agreements relating to the subject matter hereof. Neither this Agreement
nor any portion or provision hereof may be changed, modified, amended, waived,
supplemented, discharged, canceled or terminated orally or by any course
of
dealing, or in any manner other than by an agreement in writing, signed by
the
party to be charged.
(b) Notice.
Any and
all notices or other communications or deliveries required or permitted to
be
provided hereunder shall be in writing and shall be deemed given and effective
on the earliest of (i) the date of transmission, if such notice or communication
is delivered via facsimile at the facsimile telephone number specified in
this
Section prior to 6:30 p.m. (New York City time) on a Business Day, (ii) the
Business Day after the date of transmission, if such notice or communication
is
delivered via facsimile at the facsimile telephone number specified in this
Agreement later than 6:30 p.m. (New York City time) on any date and earlier
than
11:59 p.m. (New York City time) on such date, (iii) the Business Day following
the date of mailing, if sent by nationally recognized overnight courier service,
or (iv) upon actual receipt by the party to whom such notice is required
to be
given. The address for such notices and communications shall be as
follows:
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|
If
to the Pledgor
|
|
|
0000
Xxxxxxx Xxxxxx # 0
|
|
|
Xxx
Xxxxx, XX 00000
|
|
|
Facsimile
No.: (000) 000-0000
|
|
|
Attn:
Secretary
|
If
to the
Pledgees: At
the
address set forth opposite their name on the signature page
or
such
other address as may be designated in writing hereafter, in the same manner,
by
such Person.
(c) Invalidity.
If any
part of this Agreement is contrary to, prohibited by, or deemed invalid under
applicable laws or regulations, such provision shall be inapplicable and
deemed
omitted to the extent so contrary, prohibited or invalid, but the remainder
hereof shall not be invalidated thereby and shall be given effect so far
as
possible.
(d) Benefit
of Agreement.
This
Agreement shall be binding upon and inure to the parties hereto and their
respective successors and assigns.
(e) Mutual
Agreement.
This
Agreement embodies the arm’s length negotiation and mutual agreement between the
parties hereto and shall not be construed against either party as having
been
drafted by it.
(f) Governing
Law.
This
Agreement shall be governed by and construed and enforced in accordance with
the
internal laws of the State of New York without regard to the principles of
conflicts of law thereof. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and Federal courts sitting in the county of New
York
for the adjudication of any dispute hereunder or in connection herewith or
with
any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court or
that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in
any
such suit, action or proceeding by mailing a copy thereof to such party at
the
address in effect for notices to it under this Agreement and agrees that
such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any
right
to serve process in any manner permitted by law.
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IN
WITNESS WHEREOF, the parties hereto have caused this Stock Pledge Agreement
to
be duly executed by their respective authorized persons as of the date first
indicated above.
|
PLEDGOR:
|
| BIO SOLUTIONS MANUFACTURING, INC. |
|
By:
/s/
Xxxxx X. Xxxxxxx
|
| Name: Xxxxx X. Xxxxxxx |
| Title: President |
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PLEDGEES:
[INTENTIONALLY
OMITTED]
