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Exhibit 2
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PLEDGE AGREEMENT
May 8, 1997
Capital Video Corporation
0000 Xxxx Xxx.
Xxxxxxxx, XX 00000
Gentlemen:
1. Pledge.
As collateral security for the obligations of the undersigned (the
"Pledgor") to Capital Video Corporation (the "Corporation") under that certain
Promissory Note of Pledgor of even date herewith (the "Obligations"), the
Pledgor hereby pledges, grants a security interest in, mortgages, assigns,
transfers, delivers, sets over and confirms unto the Corporation, its
successors and assigns, the following property:
Seven Hundred Thirty Thousand Eight Hundred Sixty-Three (730,863)
shares of the unregistered Common Stock of Metro Global Media, Inc., a
Delaware corporation, registered in the name of the Pledgor,
represented by certificates numbered 1272, 2343, 2344, 2345, 2346,
2347, 2348, 2349 and 2350, with stock power attached duly endorsed in
blank.
Pledgor warrants and represents that there are no restrictions upon the
transfer of any of the foregoing shares and that Pledgor has the right to
transfer said shares free of any encumbrance.
Pledgor hereby agrees promptly to pledge and deposit hereunder with
Corporation any stock or other securities declared as a dividend with respect
to or issued as a split of any securities now or hereafter held in pledge
hereunder and any additional property hereafter pledged to Corporation by
Pledgor, whether taken in substitution for or in addition to the above
described property. Such stock, other securities and property shall stand
pledged and assigned for the Obligations in the same manner as the property
described in this Section 1 (All of the property described in this Section 1
is hereinafter called the "Pledged Stock").
2. Voting Power, Dividends, Etc.
(a) Unless and until an Event of Default (as hereinafter
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defined), or an event which with the passage of time or giving of notice, or
both, would constitute an Event of Default, has occurred, the Pledgor shall
have the right to exercise all voting, consensual and other powers of ownership
pertaining to the Pledged Stock. All dividends and other distributions on the
Pledged Stock shall be paid directly to Corporation and retained by it as part
of the Pledged Stock, subject to the terms of this Pledge Agreement.
(b) If any Event of Default or an event which, with the passage of time or
giving of notice, or both, would constitute an Event of Default, shall have
occurred, then (and whether or not any holder of the Obligations exercises any
available option to declare the Obligations due and payable or seeks or pursues
any other relief or remedy available to such holder under this Pledge
Agreement, or the Obligations) Corporation, or its nominee or nominees, shall
forthwith, without further act on the part of any person, have the sole and
exclusive right to exercise all voting, consensual and other powers of
ownership pertaining to the Pledged Stock and shall exercise such powers in
such manner as Corporation, in its sole discretion, shall determine to be
necessary, appropriate or advisable, and, if Corporation shall so request in
writing, the Pledgor agrees to execute and deliver to Corporation such other
and additional powers, authorizations, proxies, dividends and such other
documents as Corporation may reasonably request to secure to Corporation the
rights, powers and authorities intended to be conferred upon Corporation by
this Subsection (b).
(c) Except as otherwise set forth above, the remedying of any such Event
of Default shall not divest Corporation of its rights under subsection (b)
unless and until Corporation in writing acknowledges that such Event of Default
has been remedied.
3. Sale of Pledged Stock After an Event of Default.
If any Event of Default shall have occurred, and the principal amount of
the Obligations shall have been declared forthwith due and payable, then,
unless the Obligations shall have been paid in full at or before the time the
notice provided for in subsection (a) of this Section 3 shall be given or at or
before the time the action provided for in subsection (b) of this Section 3
shall be commenced, Corporation may, in its sole discretion, without further
demand, advertisement or notice, except as expressly provided for in subsection
(a) of this Section 3, (i) apply the cash, if any, then held by it as
collateral hereunder, for the purposes and in the manner provided in Section 4
hereof, and (ii) if there shall be no such cash or the cash so applied
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shall be insufficient to make in full all payments provided in Subsections (a)
and (b) of Section 4 hereof:
(a) Sell the Pledged Stock, or any part thereof, in one or more sales,
at public or private sale, conducted by any officer or agent of, or auctioneer
or attorney for, Corporation, at Corporation's place of business or elsewhere,
for cash, upon credit or future delivery, and at such price or prices as
Corporation shall, in its sole discretion, determine, and Corporation may be
the purchaser of any or all of the Pledged Stock so sold. Corporation may, in
its discretion, at any such sale restrict the prospective bidders or purchasers
as to their number, nature of business and investment intention, including,
without limitation, a requirement that the persons making such purchases
represent and agree to the satisfaction of Corporation that they are purchasing
the Pledged Stock for their account, for investment, and not with a view to the
distribution or resale of any thereof. Upon any such sale Corporation shall
have the right to deliver, assign and transfer to the purchaser thereof the
Pledged Stock so sold. Each purchaser (including Corporation) at any such sale
shall hold the Pledged Stock so sold, absolutely free from any claim or right
of whatsoever kind, including, without limitation, any equity or right of
redemption, of the Pledgor, which the Pledgor hereby specifically waives, to
the extent it may lawfully do so, and all rights of redemption, stay or
appraisal which it has or may have under any rule of law or statute now
existing or hereafter adopted. Corporation shall give the Pledgor at least ten
(10) days' written notice, in case of public or private sale, of such sale and
shall state the time and place fixed for such sale. Any such public sale shall
be held at such time or times within ordinary business hours as Corporation
shall fix in the notice of such sale. At any such sale the Pledged Stock may
be sold in one lot as an entirety or in separate parcels. Corporation shall
not be obliged to make any sale pursuant to any such notice. Corporation may,
without notice or publication, adjourn any public or private sale from time to
time by announcement at the time and place fixed for such sale, or any
adjournment thereof, and any such sale may be made at any time or place to
which the same may be so adjourned without further notice or publication. In
case of any sale of all or any part of the Pledged Stock or credit or for
future delivery, the Pledged Stock so sold may be retained by Corporation until
the selling price is paid by the purchaser thereof, but Corporation shall not
incur any liability in case of the failure of such purchaser to take up and pay
for the Pledged Stock so sold, and in case of any such failure, such Pledged
Stock may again be sold under and pursuant to the provisions hereof; or
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Corporation as attorney-in-fact pursuant to Section 6 hereof may, in the
name and stead of the Pledgor, make and execute all conveyances, assignments
and transfers of the Pledged Stock sold pursuant to Subsection (a) or (b) of
this Section 3. The Pledgor shall, if so requested by Corporation, ratify and
confirm any sale or sales by executing and delivering to Corporation or to such
purchaser or purchasers, all such instruments as may, in the opinion of
Corporation, be advisable for the purpose.
The receipt of Corporation for the purchase money paid at any such sale
made by it shall be a sufficient discharge therefor to any purchaser of the
Pledged Stock, or any portion thereof, sold as aforesaid; and no such purchaser
(or his or its representatives or assigns), after paying such purchase money
and receiving such receipt, shall be bound to see to the application of such
purchase money or any part thereof or in any manner whatsoever be answerable
for any loss, misapplication or nonapplication of any such purchase money, or
any part thereof, or be bound to inquire as to the authorization, necessity,
expediency or regularity of any such sale.
The remedying of any such Event of Default shall not divest Corporation of
its rights under this Section 3 unless and until Corporation waives said rights
in writing.
4. Application of Proceeds.
The proceeds of any sale, or of collection, of all or any part of the
Pledged Stock shall be applied by Corporation, without any marshaling of
assets, in the following order:
(a) first, to the payment of all of the costs and expenses of such sale,
including, without limitation, reasonable compensation to Corporation and its
agents, attorneys and counsel, and all other expenses, liabilities and advances
made or incurred by Corporation in connection therewith; and
(b) finally, to the payment to the Pledgor, its successors and assigns, or
their respective heirs, executors or administrators, or to whomsoever may be
lawfully entitled to receive the same or as a court of competent jurisdiction
may direct, of any surplus remaining from such proceeds after payments of the
character referred to in Subsections (a) and (b) of this Section 4 shall have
been made.
5. Corporation Appointed Attorney-in-Fact; Indemnity.
(a) Corporation, its successors and assigns, is hereby appointed enduring
attorney-in-fact, with full power of substitution, of the Pledgor for the
purpose of carrying out
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the provisions of this Pledge Agreement and taking any action and executing any
instruments which such attorney-in-fact may deem necessary or advisable to
accomplish the purposes hereof. (b)The Pledgor will indemnify and save
harmless Corporation from and against any liability or damage which it may
incur, in good faith and without negligence, in the exercise and performance of
any of Corporation's powers and duties specifically set forth herein.
6. No Waiver.
No failure on the part of Corporation to exercise, and no delay on the
part of Corporation in exercising, any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise by
Corporation of any right, power or remedy hereunder preclude any other or
further right, power or remedy. The remedies herein provided are cumulative
and are not exclusive of any remedies provided by law.
7. Termination of Pledge.
When the Promissory Note shall have been paid in full, this Pledge
Agreement shall terminate. Corporation shall forthwith assign, transfer and
deliver to the Pledgor or its assignees, without representation, warranty or
recourse, against appropriate receipts, all the Pledged Stock, if any, then
held by it in pledge hereunder.
8. Governing Law.
This Pledge Agreement shall in all respects be construed and interpreted
in accordance with and governed by the laws of the Bermuda.
9. Successors and Assigns.
This Pledge Agreement shall be binding upon and inure to the benefit of
the respective successors and assigns of the Pledgor and Corporation, and any
subsequent holder of the Promissory Note or the Obligations.
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10. Additional Instruments and Assurance.
The Pledgor hereby agrees, at its own expense, to execute and deliver,
from time to time, any and all further, or other, instruments, and to perform
such acts, as Corporation may reasonably request to effect the purposes of this
Pledge Agreement and to secure to Corporation, and to all persons who may from
time to time be the holder of the Promissory Note or the Obligations, the
benefits of all rights, authorities and remedies conferred upon Corporation by
the terms of this Pledge Agreement.
11. Future Holders of Notes.
This Pledge Agreement is for the benefit of any and all future holders of
the Obligations in addition to Corporation, each of whom shall, without
further act, become a party hereto by becoming a holder of the Promissory Note.
12. Notices.
All notices, requests, demands, consents or other communications given
hereunder or in connection herewith shall be in writing and sent by registered
mail, return receipt requested, postage prepaid, addressed to the Pledgor at
the address set forth below, and to the Corporation, at its principal office
set forth above. The Pledgor or Corporation may, by notice given as aforesaid,
change its address for all subsequent notices. Notice shall be deemed given
when so deposited in the mail.
13. Separability.
In case any one or more of the provisions of this Pledge Agreement shall for
any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof, but this Pledge Agreement shall be construed as if such invalid,
illegal or unenforceable provision had not been included.
14. Events of Default.
The Pledgor shall be in default under this Pledge Agreement upon the
occurrence of any one of the following events (herein referred to as an "Event
of Default"):
(a) default by the Pledgor in the due observance or performance of any
covenant or agreement contained herein or breach by the Pledgor of any
representation or warranty contained herein and such default shall continue
unremedied for thirty
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(30) days after written notice thereof is given by Corporation to the Pledgor;
or
(b) any default by the Xxxxxxx in the payment or performance when due of any
of the Obligations, including, without limitation, the payment of the principal
of, or interest on, any indebtedness of the Pledgor to Corporation, as set
forth in the Promissory Note.
15. Headings.
The headings of the Sections of this Pledge Agreement have been inserted
for convenience of reference only and shall in no way affect the construction
or interpretation of this Pledge Agreement.
Please indicate your receipt of the property described in the first
paragraph hereof and your agreement to the terms and provisions hereof by
executing this Pledge Agreement in the space provided below.
(Signature block of the following page.)
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BRIANA INVESTMENT GROUP, LP
by its General Partner
WINDBRIDGE HOLDINGS, LTD.,
BY /s/ Xxxxxx X. Xxxxxxx, Xx.
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Xxxxxx X. Xxxxxxx, Xx., Director
Witness
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Dated this 8th day of May, 1997.
CAPITAL VIDEO CORPORATION
By /s/ A. Xxxxxx Xxxxxx
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A. Xxxxxx Xxxxxx,
Director
Dated this 8th day of May, 1997
