PLEDGE AGREEMENT
THIS
PLEDGE
AGREEMENT,
made as
of this ______
day
of
June,
2008
(this “Agreement”),
is
between OPTIONS
MEDIA GROUP HOLDINGS, INC.,
a
Nevada
corporation
(“Pledgor”),
and
CUSTOMER
ACQUISITION NETWORK HOLDINGS, INC.,
a
Delaware
corporation (together
with its successors and assigns, the “Pledgee”).
A. The
Pledgor
has
executed and delivered to the Pledgee
that
certain secured senior note made by Pledgor
and
dated
as of the date hereof in an original aggregate principal amount of $1,000,000
(such note, together with any promissory notes or other securities issued in
exchange or substitution therefor or replacement thereof, and as any of the
same
may be amended, supplemented, restated or modified and in effect from time
to
time, the “Note”).
The
Note
was
issued pursuant to a loan and certain other financial accommodations (the
“Loan”)
made
by Pledgee
to
Pledgor.
B. The
Pledgor
legally
and beneficially owns one hundred percent (100%) of the issued and outstanding
shares of capital
stock or other equity interests of Options
Acquisition
Sub, Inc., a Delaware
corporation
(“Options”)
and
each other corporation or other entity, the capital stock or other equity
interests and securities of which are owned or acquired by Pledgor,
and
described on an addendum hereto from time to time executed by Pledgor
in
form
and substance satisfactory to Pledgee
(referred to herein as a “Pledge
Entity”
and,
collectively, as the “Pledge
Entities”).
C. Pursuant
to a Security
Agreement of
even
date herewith by and among Pledgor
and
Pledgee
(as
the
same may be amended, restated, modified or supplement and in effect from time
to
time, the “Security
Agreement”),
Pledgor
has
granted Pledgee,
for its
benefit, a first priority security interest in, lien upon and pledge of its
rights in the Collateral
(as
defined in the Security
Agreement).
D. To
induce
the Pledgee
to
make
the Loan,
and in
order to secure the payment and performance by Pledgor
of
the
Liabilities
(as
defined in the Security
Agreement),
Pledgor
has
agreed to pledge to Pledgee
all
of
the capital stock and other equity interests and securities of the Pledge
Entities now
or
hereafter owned or acquired by Pledgor.
NOW,
THEREFORE,
in
consideration of the premises and in order to induce the Pledgee
to
make
the Loan
and
for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, Pledgor
hereby
agrees with Pledgee
as
follows:
1. Defined
Terms.
Unless
otherwise defined herein, all capitalized terms used herein shall have the
meanings given them in the Security Agreement.
2. Pledge.
Pledgor
hereby
pledges, assigns, hypothecates, transfers, delivers and grants to Pledgee,
a first
lien on and first priority perfected security interest in (i)
all
of
the capital
stock or other equity interests of the Pledge
Entities now
owned
or hereafter acquired by Pledgor
(collectively,
the “Pledged
Shares”),
(ii)
all
other
property hereafter delivered to, or in the possession or in the custody of,
Pledgee,
in
substitution for or in addition to the Pledged
Shares,
(iii)
any
other
property of Pledgor,
as
described in Section
4 below
or
otherwise, whether now or hereafter delivered to, or in the possession or
custody of Pledgor,
and
(iv)
all
proceeds of the collateral described in the preceding clauses
(i),
(ii) and
(iii) (the
collateral described in clauses
(i) through
(iv) of
this
Section
2 being
collectively referred to as the “Pledged
Collateral”),
as
collateral security for the prompt and complete payment and performance when
due
(whether at the stated maturity, by acceleration or otherwise) of the
Liabilities.
All of
the Pledged
Shares now
owned
by Pledgor
which
are
presently represented by certificates are listed on Exhibit A hereto,
which certificates, with undated
assignments
separate from certificates
or stock powers duly
executed in blank by Pledgor
and
irrevocable proxies, are being delivered to Pledgee
simultaneously
herewith. Upon the creation or acquisition of any new Pledged
Shares,
Pledgor
shall
execute an Addendum
in
the
form of Exhibit
B attached
hereto (a “Pledge
Addendum”).
Any
Pledged
Collateral described
in a Pledge
Addendum executed
by Pledgor
shall
thereafter be deemed to be listed on Exhibit
A hereto.
Pledgee
shall
maintain possession and custody of the certificates representing the
Pledged
Shares and
any
additional Pledged
Collateral.
3. Representations
and Warranties of Pledgor. Pledgor
represents
and warrants to Pledgee,
and
covenants with Pledgee,
that:
(a) Exhibit
A sets
forth (i)
the
authorized capital
stock or other equity interests of each Pledge
Entity,
(ii)
the
number of shares of capital
stock or other equity interests of each Pledge
Entity that
are
issued and outstanding as of the date hereof, and (iii)
the
percentage of the issued and outstanding shares of capital
stock or other equity interests of each Pledge
Entity held
by
Pledgor.
Pledgor
is
the
record and beneficial owner of, and has good and marketable title to, the
Pledged
Shares,
and
such shares or other equity interests are and will remain free and clear of
all
pledges, liens, security interests and other encumbrances and restrictions
whatsoever, except the
liens
and security interests in
favor
of Pledgee
created
by this Agreement;
(b) Except
as
set forth on Exhibit
A,
there
are no outstanding options,
warrants or other similar agreements with respect to the Pledged
Shares or
any of
the other Pledged
Collateral;
(c) this
Agreement
is
the
legal, valid and binding obligation of the Pledgor,
enforceable against the Pledgor
in
accordance with its terms;
(d) the
Pledged
Shares have
been
duly and validly authorized and issued, are fully paid and non-assessable,
and
the Pledged
Shares listed
on
Exhibit
A constitute
all of the issued and outstanding capital
stock or other equity interests of the Pledge
Entities;
(e) no
consent, approval or authorization of or designation or filing with any
governmental or regulatory authority on the part of Pledgor
is
required in connection with the pledge and security interest granted under
this
Agreement;
(f) the
execution, delivery and performance of this Agreement
will
not
violate any provision of any applicable law or regulation or of any order,
judgment, writ, award or decree of any court, arbitrator or governmental
authority, domestic or foreign, or of the articles or certificate of
incorporation, bylaws or any other similar organizational documents of
Pledgor
or
any
Pledge
Entity or
of any
securities issued by Pledgor
or
any
Pledge
Entity or
of any
mortgage, indenture, lease, contract, or other agreement, instrument or
undertaking to which Pledgor
or
any
Pledge
Entity is
a
party or which purports to be binding upon Pledgor
or
any
Pledge
Entity or
upon
any of the assets of Pledgor
or
any
Pledge
Entity,
and
will not result in the creation or imposition of any lien, charge or encumbrance
on or security interest in any of the assets of Pledgor
or
any
Pledge
Entity,
except
as otherwise contemplated by this Agreement;
2
(g) the
pledge, assignment and delivery of the Pledged
Shares and
the
other Pledged
Collateral pursuant
to this Agreement
creates
a
valid first lien on and perfected first priority security interest in such
Pledged
Shares and
Pledged
Collateral and
the
proceeds thereof in favor of Pledgee,
subject
to no prior pledge, lien, mortgage, hypothecation, security interest, charge,
option or encumbrance or to any agreement purporting to grant to any third
party
a security interest in the property or assets of Pledgor
which
would include the Pledged
Shares or
any
other Pledged
Collateral.
Pledgor
covenants
and agrees that it will defend, for the benefit of Pledgee,
Pledgee’s
right,
title and security interest in and to the Pledged
Shares,
the
other Pledged
Collateral and
the
proceeds thereof against the claims and demands of all other persons or
entities;
(h) Each
Pledged
Share consisting
of either (i)
a
membership interest in a Person
that
is a
limited liability company or (ii)
a
partnership interest in a Person
that
is a
partnership (if any) are “securities” governed by Article 8 of the UCC.
Certificates
evidencing
such membership interests or partnership interests (if any) have been issued
to
Pledgor
by
the
applicable Person.
Pledgor
covenants
it will not cause and will not permit any Pledged
Entity to
“opt-out” of Article 8 of the UCC,
and
Pledgor
will
not
take, and will not permit any Pledged
Entity to
take,
any actions to cause the capital stock, membership interests, partnership
interests or similar equity interests of such Pledged
Entity (if
any)
to cease to be classified as “securities” governed by Article 8 of the
UCC;
and
(i) Neither
Pledgor
nor
the
Pledged
Entities (i)
will
become a person whose property or interests in property are blocked or subject
to blocking pursuant to Section 1 of Executive
Order 13224 of September
23,
2001
Blocking
Property and
Prohibiting
Transactions with
Persons
Who Commit,
Threaten
to
Commit
or
Support Terrorism (66 Fed. Reg. 49079(2001), (ii)
will
engage in any dealings or transactions prohibited by Section 2 of such executive
order, or (iii)
will
otherwise become a person on the list of Specially
Designated Nationals and
Blocked
Persons or
subject to the limitations or prohibitions under any other Office
of
Foreign Asset Control regulation
or executive order.
4. Dividends,
Distributions, Etc. If,
while
this Agreement
is
in
effect, Pledgor
shall
become entitled to receive or shall receive any certificate (including,
without limitation,
any
certificate representing a dividend or a distribution in connection with any
reclassification, increase or reduction of capital, or issued in connection
with
any reorganization, merger or consolidation), or any options
or
rights, whether as an addition to, in substitution for, or in exchange for
any
of the Pledged
Shares or
otherwise, Pledgor
agrees,
in each case, to accept the same as Pledgee’s
agent
and to hold the same in trust
for
Pledgee,
and to
deliver the same promptly (but in any event within three days) to Pledgee
in
the
exact form received, with the endorsement of Pledgor
when
necessary and/or with appropriate undated
assignments
separate from certificates
or stock powers duly
executed in blank, to be held by Pledgee
subject
to the terms hereof, as additional Pledged
Collateral.
Pledgor
shall
promptly deliver to Pledgee
(i)
a
Pledge
Addendum with
respect to such additional certificates, and (ii)
any
financing statements or amendments to financing statements as requested by
Pledgee.
Pledgor
hereby
authorizes Pledgee
to
attach
each Pledge
Amendment to
this
Agreement.
In case
any distribution of capital shall be made on or in respect of the Pledged
Shares or
any
property shall be distributed upon or with respect to the Pledged
Shares pursuant
to the recapitalization or reclassification of the capital of the issuer thereof
or pursuant to the reorganization thereof, the property so distributed shall
be
delivered to Pledgee
to
be
held by it as additional Pledged
Collateral.
Except
as provided in Section
5(b) below,
all sums of money and property so paid or distributed in respect of the
Pledged
Shares which
are
received by Pledgor
shall,
until paid or delivered to Pledgee,
be held
by Pledgor
in
trust
as
additional Pledged
Collateral.
3
(a) So
long
as no Event
of
Default (for
purposes of this Agreement,
as
defined in the Note)
has
occurred and is continuing, Pledgor
shall
be
entitled (subject to the other provisions hereof,
including,
without limitation,
Section
8 below)
to
exercise its voting and other consensual rights with respect to the
Pledged
Shares and
otherwise exercise the incidents of ownership thereof in any manner not
inconsistent with this Agreement,
the
Note,
the
Securities
Agreement,
the
Guaranty
and
the
other documents executed in relation to the Loan
(collectively,
the “Transaction
Documents”).
Pledgor
hereby
grants to Pledgee
or
its
nominee, an irrevocable proxy to exercise all voting and corporate rights
relating to the Pledged
Shares in
any
instance, provided such proxy shall be effective, at the discretion of
Pledgee,
only
upon the occurrence and during the continuance of an Event
of
Default. Upon
the
request of Pledgee
at
any
time, Pledgor
agrees
to
deliver to Pledgee
such
further evidence of such irrevocable proxy or such further irrevocable proxies
to vote the Pledged
Shares as
Pledgee
may
request.
(b) So
long
as no Event
of
Default shall
have occurred and be continuing, Pledgor
shall
be
entitled to receive cash dividends or other distributions made in respect of
the
Pledged
Shares,
to the
extent permitted to be made pursuant to the terms of the Note.
Upon
the occurrence and during the continuance of an Event
of
Default,
in the
event that Pledgor,
as
record and beneficial owner of the Pledged
Shares,
shall
have received or shall have become entitled to receive, any cash dividends
or
other distributions in the ordinary course, Pledgor
shall
deliver to Pledgee,
and
Pledgee
shall
be
entitled to receive and retain, for the benefit of Pledgee,
all
such cash or other distributions as additional security for the Liabilities.
(c) Subject
to any sale or other disposition by Pledgee
of
the
Pledged
Shares,
any
other Pledged
Collateral or
other
property pursuant to this Agreement,
upon
the indefeasible full payment in cash, satisfaction and termination of all
of
the Liabilities
and
the
termination of this Agreement
pursuant
to Section
11 hereof
and of the
liens
and security interests hereby
granted, the Pledged
Shares,
the
other Pledged
Collateral and
any
other property then held as part of the Pledged
Collateral in
accordance with the provisions of this Agreement
shall
be
returned to Pledgor
or
to
such other persons or entities as shall be legally entitled
thereto.
(d) Pledgor
shall
cause all Pledged
Shares to
be
certificated at all times while this Agreement
is
in
effect.
6. Rights
of Pledgee. Pledgee
shall
not
be liable for failure to collect or realize upon the Liabilities
or
any
collateral security or guaranty therefor, or any part thereof, or for any delay
in so doing, nor shall Pledgee
be
under
any obligation to take any action whatsoever with regard thereto. Any or all
of
the Pledged
Shares held
by
Pledgee
hereunder
may, if an Event
of
Default has
occurred and is continuing, without notice, be registered in the name of
Pledgee
or
its
nominee, and Pledgee
or
its
nominee may thereafter without notice exercise all voting and corporate rights
at any meeting with respect to any Pledge
Entity and
exercise any and all rights of conversion, exchange, subscription or any other
rights, privileges or options
pertaining
to any of the Pledged
Shares as
if it
were the absolute owner thereof,
including,
without limitation,
the
right to vote in favor of, and to exchange at its discretion any and all of
the
Pledged
Shares upon,
the
merger, consolidation, reorganization, recapitalization or other readjustment
with respect to any Pledge
Entity or
upon
the exercise by any Pledge
Entity,
Pledgor
or
Pledgee
of
any
right,
privilege or
option
pertaining to any of the Pledged
Shares,
and in
connection therewith, to deposit and deliver any and all of the Pledged
Shares with
any
committee, depository, transfer agent, registrar or other designated agency
upon
such terms and conditions as Pledgee
may
reasonably determine, all without liability except to account for property
actually received by Pledgee,
but
Pledgee
shall
have no duty to exercise any of the aforesaid rights, privileges or
options
and
shall
not be responsible for any failure to do so or delay in so
doing.
4
7. Remedies. Upon
the
occurrence and during the continuance of an Event
of
Default,
Pledgee
may
exercise in respect of the Pledged
Collateral,
in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party under the Uniform
Commercial Code (“UCC”)
in
effect
in the
State
of
New York from
time
to time, whether or not the UCC
applies
to the affected Pledged
Collateral (or
the
Uniform
Commercial Code as
in
effect in any other relevant jurisdiction). Pledgee
also,
without demand of performance or other demand, advertisement or notice of any
kind (except the notice specified below of time and place of public or private
sale) to or upon Pledgor
or
any
other person or entity (all and each of which demands, advertisements and/or
notices are hereby expressly waived), may forthwith collect, receive,
appropriate and realize upon the Pledged
Collateral,
or any
part thereof, and/or may forthwith date and otherwise fill in the blanks on
any
assignments
separate from certificates or stock power or
otherwise sell, assign, give an option or options
to
purchase, contract to sell or otherwise dispose of and deliver said
Pledged
Collateral,
or any
part thereof, in one or more portions at one or more public or private sales
or
dispositions, at any exchange or broker’s board or at any of Pledgee’s
offices or elsewhere upon such terms and conditions as Pledgee
may
deem
advisable and at such prices as it may deem best, for any combination of cash
and/or securities or other property or on credit or for future delivery without
assumption of any credit risk, with the right to Pledgee
upon
any
such sale, public or private, to purchase the whole or any part of said
Pledged
Collateral so
sold,
free of any right or equity of redemption in Pledgor,
which
right or equity is hereby expressly waived or released. Pledgee
shall
apply the net proceeds of any such collection, recovery, receipt, appropriation,
realization, sale or disposition, after deducting all costs and expenses of
every kind incurred therein or incidental to the safekeeping of any and all
of
the Pledged
Collateral or
in any
way relating to the rights of Pledgee
hereunder,
including attorneys’ fees and legal expenses, to the payment, in whole or in
part, of the Liabilities,
in such
order as Pledgee
may
elect. Pledgor
shall
remain liable for any deficiency remaining unpaid after such application. Only
after so paying over such net proceeds and after the payment by Pledgee
of
any
other amount required by any provision of law, including,
without limitation,
Section
9-608 of the UCC,
need
Pledgee
account
for the surplus, if any, to Pledgor.
Pledgor
agrees
that Pledgee
will
give
reasonable notice (such reasonable notice to be determined by Pledgee
in
its
sole and absolute discretion) of the time and place of any public sale or of
the
time after which a private sale or other intended disposition is to take place.
No notification need be given to Pledgor
if
it has
signed after default a statement renouncing or modifying any right to
notification of sale or other intended disposition.
8. No
Disposition, Etc. Pledgor
agrees
that it will not sell, assign, transfer, exchange, or otherwise dispose of,
or
grant any option with respect to, the Pledged
Shares or
any
other Pledged
Collateral,
nor
will Pledgor
create,
incur or permit to exist any pledge, lien, mortgage, hypothecation, security
interest, charge, option or any other encumbrance with respect to any of the
Pledged
Shares or
any
other Pledged
Collateral,
or any
interest therein, or any proceeds thereof, except for the lien and security
interest of Pledgee
provided
for by this Agreement
and
the
Security
Agreement.
(a) Pledgor
recognizes
that Pledgee
may
be
unable to effect a public sale or disposition (including,
without limitation,
any
disposition in connection with a merger of a Pledge
Entity)
of any
or all the Pledged
Shares by
reason
of certain prohibitions contained in the Securities
Act of 1933,
as
amended (the “1933
Act”),
and
applicable state
securities laws,
but may
be compelled to resort to one or more private sales or dispositions thereof
to a
restricted group of purchasers who will be obliged to agree, among other things,
to acquire such securities for their own account, for investment and not with
a
view to the distribution or resale thereof. Pledgor
acknowledges
and agrees that any such private sale or disposition may result in prices and
other terms (including the terms of any securities or other property received
in
connection therewith) less favorable to the seller than if such sale or
disposition were a public sale or disposition and, notwithstanding such
circumstances, agrees that any such private sale or disposition shall be deemed
to be reasonable and affected in a commercially reasonable manner. Pledgee
shall
be
under no obligation to delay a sale or disposition of any of the Pledged
Shares in
order
to permit Pledgor
or
a
Pledge
Entity to
register such securities for public sale under the 1933
Act,
or
under applicable state
securities laws,
even if
Pledgor
or
a
Pledge
Entity would
agree to do so.
5
(b) Pledgor
further
agrees to do or cause to be done all such other acts and things as may be
reasonably necessary to make such sales or dispositions of the Pledged
Shares valid
and
binding and in compliance with any and all applicable laws, regulations, orders,
writs, injunctions, decrees or awards of any and all courts, arbitrators or
governmental instrumentalities, domestic or foreign, having jurisdiction over
any such sales or dispositions, all at Pledgor’s
expense. Pledgor
further
agrees that a breach of any of the covenants contained in Sections
4,
5(a),
5(b),
8,
9
and
24
will
cause irreparable injury to Pledgee
and
that
Pledgee
has
no
adequate remedy at law in respect of such breach and, as a consequence, agrees,
without limiting the right of Pledgee
to
seek
and obtain specific performance of other obligations of Pledgor
contained
in this Agreement,
that
each and every covenant referenced above shall be specifically enforceable
against Pledgor,
and
Pledgor
hereby
waives and
agrees not to assert any defenses against an action for specific performance
of
such covenants.
(c) Pledgor
further
agrees to indemnify and hold harmless Pledgee
and
its
successors and assigns, officers, directors, employees, attorneys and agents,
and any person or entity in control of any thereof, from and against any loss,
liability, claim, damage and expense,
including,
without limitation,
legal
fees and expenses (in this paragraph collectively called the “Indemnified
Liabilities”),
under
federal and state
securities laws or
otherwise insofar as such Indemnified
Liability (i)
arises
out of or is based upon any untrue statement or alleged untrue statement of
a
material fact contained in any registration statement, prospectus or offering
memorandum or in any preliminary prospectus or preliminary offering memorandum
or in any amendment or supplement to any thereof or in any other writing
prepared in connection with the offer, sale or resale of all or any portion
of
the Pledged
Collateral unless
such untrue statement of material fact was provided by Pledgee,
in
writing, specifically for inclusion therein, or (ii)
arises
out of or is based upon any omission or alleged omission to state therein a
material fact required to be stated or necessary to make the statements therein
not misleading, such indemnification to remain operative regardless of any
investigation made by or on behalf of Pledgee
or
any
successor thereof, or any person or entity in control of any thereof. In
connection with a public sale or other distribution, Pledgor
will
provide customary indemnification to any underwriters, their successors and
assigns, officers and directors and each person or entity who controls any
such
underwriter (within the meaning of the 1933
Act).
If and
to the extent that the foregoing undertakings in this paragraph may be
unenforceable for any reason, Pledgor
agrees
to
make the maximum contribution to the payment and satisfaction of each of the
Indemnified
Liabilities which
is
permissible under applicable law. The obligations of Pledgor
under
this paragraph
(c) shall
survive any termination of this Agreement.
(d) Pledgor
further
agrees to waive any and all rights of subrogation it may have against a
Pledge
Entity upon
the
sale or disposition of all or any portion of the Pledged
Collateral by
Pledgee
pursuant
to the terms of this Agreement
until
the
termination of this Agreement
in
accordance with Section
11 below.
6
10. No
Waiver; Cumulative Remedies.
Pledgee
shall
not
by any act, delay, omission or otherwise be deemed to have waived any of its
remedies hereunder, and no waiver by Pledgee
shall
be
valid unless in writing and signed by Pledgee,
and
then only to the extent therein set forth. A waiver by Pledgee
of
any
right or remedy hereunder on any one occasion shall not be construed as a bar
to
any right or remedy which Pledgee
would
otherwise have on any further occasion. No course of dealing between
Pledgor
and
Pledgee
and
no
failure to exercise, nor any delay in exercising on the part of Pledgee
of,
any
right,
power or privilege hereunder
or under the other Transaction
Documents shall
impair such right or remedy or operate as a waiver thereof; nor shall any single
or partial exercise of any right,
power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right,
power or privilege.
The
rights and remedies herein provided are cumulative and may be exercised singly
or concurrently, and are not exclusive of any rights or remedies provided by
law.
11. Termination. This
Agreement
and
the
liens
and security interests granted
hereunder shall terminate and Pledgee
shall
return any Pledged
Shares or
other
Pledged
Collateral then
held
by Pledgee
in
accordance with the provisions of this Agreement
to
Pledgor
upon
the
termination of the Note
and
the
full and complete performance and indefeasible satisfaction of all of the
Liabilities
(i)
in
respect of the Note
(including,
without limitation,
the
indefeasible payment in full in cash of all such Liabilities)
and
(ii)
with
respect to which claims have been asserted by Pledgee.
12. Possession
of Collateral. Beyond
the exercise of reasonable care to assure the safe custody of the Pledged
Shares in
the
physical possession of Pledgee
pursuant
hereto, neither Pledgee,
nor any
nominee of Pledgee,
shall
have any duty or liability to collect any sums due in respect thereof or to
protect, preserve or exercise any rights pertaining thereto (including any
duty
to ascertain or take action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relating to the Pledged
Collateral and
any
duty to take any necessary steps to preserve rights against any parties with
respect to the Pledged
Collateral),
and
shall be relieved of all responsibility for the Pledged
Collateral upon
surrendering them to Pledgor.
Pledgor
assumes
the responsibility for being and keeping itself informed of the financial
condition of a Pledge
Entity and
of
all other circumstances bearing upon the risk of non-payment of the
Liabilities,
and
Pledgee
shall
have no duty to advise Pledgor
of
information known to Pledgee
regarding
such condition or any such circumstance. Pledgee
shall
have no duty to inquire into the powers of a Pledge
Entity or
its
officers, directors, managers, members, partners or agents thereof acting or
purporting to act on its behalf.
13. Taxes
and Expenses.
Pledgor
will
upon
demand pay to Pledgee,
(a)
any
taxes
(excluding income taxes, franchise taxes or other taxes levied on gross
earnings, profits or the like of Pledgee)
payable
or ruled payable by any Governmental
Authority (as
defined in the Security
Agreement)
in
respect of this Agreement,
together with interest and penalties, if any, and (b)
all
expenses, including the fees and expenses of counsel for Pledgee
and
of
any experts and agents that Pledgee
may
incur
in connection with (i)
the
administration, modification or amendment of this Agreement,
(ii)
the
custody or preservation of, or the sale of, collection from, or other
realization upon, any of the Pledged
Collateral,
(iii)
the
exercise or enforcement of any of the rights of Pledgee
hereunder,
or (iv)
the
failure of Pledgor
to
perform or observe any of the provisions hereof.
7
14. Pledgee
Appointed Attorney-In-Fact.
Pledgor
hereby
irrevocably appoints Pledgee
as
Pledgor’s
attorney-in-fact, with full authority in the place and stead of Pledgor
and
in
the name of Pledgor
or
otherwise, from time to time in Pledgee’s
discretion, to take any action and to execute any instrument that Pledgee
deems
reasonably necessary or advisable to accomplish the purposes of this
Agreement,
including,
without limitation,
(i)
to
receive, endorse and collect all instruments made payable to 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, when and to the extent
permitted by this Agreement
and
(ii)
to
complete any assignment separate from certificate delivered hereunder; provided
that the power of attorney granted hereunder shall only be exercised by
Pledgee
after
the
occurrence and during the continuance of an Event
of
Default.
15. Governing
Law; Jurisdiction; Jury Trial.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement
shall
be
governed by the internal laws of the
State
of
New York,
without
giving effect to any choice of law or conflict of law provision or rule (whether
of the
State
of
New York or
any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the
State
of
New York.
Each
party hereby irrevocably submits to the non-exclusive jurisdiction of the state
and federal courts sitting in the
City
of
New York,
borough
of Manhattan,
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,
that such
suit, action or proceeding is
brought in an inconvenient forum or that the venue of 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 for such 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. Notwithstanding
the
foregoing, the Pledgee
may
enforce its rights and remedies in any other jurisdiction applicable to the
Pledged
Collateral.
EACH
PARTY HEREBY
IRREVOCABLY WAIVES ANY
RIGHT
IT MAY
HAVE,
AND
AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE
HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT
OR
ANY
TRANSACTION CONTEMPLATED HEREBY.
16. Counterparts.
This
Agreement
may
be
executed in two or more identical counterparts, all of which shall be considered
one and the same agreement and shall become effective when counterparts have
been signed by each party and delivered to the other party; provided that a
facsimile, .pdf or similar electronically transmitted signature shall be
considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original
signature.
17. Headings.
The
headings of this Agreement
are
for
convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement.
18. Severability.
If any
provision of this Agreement
shall
be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement
in
that
jurisdiction or the validity or enforceability of any provision of this
Agreement
in
any
other jurisdiction.
8
19. Entire
Agreement; Amendments.
This
Agreement
supersedes
all other prior oral or written agreements between Pledgor,
Pledgee,
and
their affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement
and
the
Transaction
Documents and
instruments referenced herein and therein contain the entire understanding
of
the parties with respect to the matters covered herein and
therein.
20. Notices.
All
notices,
approvals, requests, demands and other communications hereunder shall be
delivered or made in the manner set forth in, and shall be effective in
accordance with the terms of, the Security
Agreement,
directed to the notice address set forth therein.
21. Successors
and Assigns.
This
Agreement
shall
be
binding upon and inure to the benefit of the parties and their respective
successors and assigns. Pledgor
shall
not
assign this Agreement
or
any
rights or obligations hereunder without the prior written consent of
Pledgee.
Pledgee
may
assign its rights hereunder without the consent of Pledgor,
in
which event such assignee shall be deemed to be Pledgee
hereunder
with respect to such assigned rights.
22. No
Third Party Beneficiaries.
This
Agreement
is
intended for the benefit of the parties hereto and their respective successors
and permitted assigns, and is not for the benefit of, nor may any provision
hereof be enforced by, any other person or entity.
23. Survival.
All
representations,
warranties, covenants and agreements of Pledgor
and
Pledgee
shall
survive the execution and delivery of this Agreement.
24. Further
Assurances.
Pledgor
agrees
that at any time and from time to time upon the written request of Pledgee,
Pledgor
will
execute and deliver all assignments
separate from certificates or stock powers,
financing statements and such further documents and do such further acts and
things as Pledgee
may
reasonably request consistent with the provisions hereof in order to carry
out
the intent and accomplish the purpose of this Agreement
and
the
consummation of the transactions contemplated hereby.
25. No
Strict Construction.
The
language used in this Agreement
will
be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any
party.
26. Pledgee
Authorized.
Pledgor
hereby
authorizes Pledgee
to
file
one or more financing or continuation statements and amendments thereto (or
similar documents required by any laws of any applicable jurisdiction) relating
to all or any part of the Pledged
Shares or
other
Pledged
Collateral without
the signature of Pledgor.
27. Pledgee
Acknowledgement.
Pledgor
acknowledges
receipt of an executed copy of this Agreement.
The
Pledgor
waives
the right to receive any amount that it may now or hereafter be entitled to
receive (whether by way of damages, fine, penalty, or otherwise) by reason
of
the failure of the Pledgee
to
deliver to the Pledgor
a
copy of
any financing statement or any statement issued by any registry that confirms
registration of a financing statement relating to this Agreement.
9
IN
WITNESS
WHEREOF, the parties hereto have caused this Pledge
Agreement to
be
duly executed and delivered by their duly authorized officers on the date first
above written.
|
PLEDGOR:
|
|
|
OPTIONS MEDIA GROUP HOLDINGS, INC.,
a
Nevada corporation
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
|
PLEDGEE:
|
|
|
CUSTOMER
ACQUISITION NETWORK
HOLDINGS,
INC., a Delaware corporation
|
|
|
By:
|
|
|
Name:
|
|
Each
of
the
undersigned hereby (i)
acknowledges
receipt of a copy of the foregoing Pledge
Agreement,
(ii)
waives
any rights or requirement at any time hereafter to receive a copy of such
Pledge
Agreement in
connection with the registration of any Pledged
Shares (as
defined therein) in the name of Pledgee
or
its
nominee or the exercise of voting rights by Pledgee
and
(iii)
agrees
promptly to note on its books and records the grant of the security interest
in
the stock or other equity interests of the undersigned as provided in such
Pledge
Agreement.
|
a
Delaware corporation
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
EXHIBIT
A
|
Name
of
Pledge
Entity
|
Class
of Stock
or
Other
Equity
Interests
|
Authorized
No.
of
Shares
or
Units
|
Issued
and
Outstanding
Shares
or
Units
|
Percentage
of
Shares
or Units
Held
by Pledgor
|
||||
|
Options
Acquisitions Sub, Inc.
|
100.0%
|
|
Name
of
Pledge
Entity
|
Class
of Stock or
Other
Equity
Interests
|
Stock
or Unit
Certificate
No.
|
No.
of Shares or Units
|
|||
|
Options
Acquisitions Sub, Inc.
|
12,250,000
|
2
EXHIBIT
B
Addendum
to Pledge Agreement
The
undersigned,
being the Pledgor
pursuant
to that certain Pledge
Agreement dated
as
of _____ __, 2008 (as amended, restated, supplemented or otherwise modified
from
time to time, the “Pledge
Agreement”)
in
favor of Viking Asset Management, a California
limited
liability company
(“Pledgee”),
by
executing this Addendum, hereby acknowledges that Pledgor
has
acquired and legally and beneficially owns all of the issued and outstanding
[
shares
of
capital stock ] of
[__________________,
a _______ corporation ] (“Company”)
described below (the “Shares”).
Pledgor
hereby
agrees and acknowledges that the Shares
shall
be
deemed Pledged
Shares pursuant
to the Pledge
Agreement.
Pledgor
hereby
represents and warrants to Pledgee
that
(i)
all
of
the [
capital stock ] of
the
Company
now
owned
by Pledgor
is
presently represented by the certificates listed below, which certificates,
with
undated
assignments
separate from certificate
or stock powers duly
executed in blank by Pledgor,
are
being delivered to Pledgee,
simultaneously herewith (or have been previously delivered to Pledgee),
and
(ii)
after
giving effect to this addendum, the representations and warranties set forth
in
Section 3
of
the
Pledge
Agreement are
true,
complete and correct as of the date hereof.
|
Name
of
the
Pledged Entity
|
Class
of Equity Interest
|
Certificate
No.
|
No.
of Shares
|
|||
|
OPTIONS MEDIA GROUP HOLDINGS, INC.,
|
|
|
a
Nevada corporation
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
3
