STOCK PLEDGE AGREEMENT
Exhibit
10.3
This
Stock Pledge Agreement (this “Agreement”), dated as
of March 31, 2008, among LV ADMINISTRATIVE SERVICES INC., as administrative and
collateral agent for the Creditor Parties (as defined below) (the “Pledgee”), RAPID
LINK, INCORPORATED, a Delaware corporation (the “Company”), and each
of the other undersigned parties (the Company and each such other undersigned
party, a “Pledgor” and
collectively, the “Pledgors”).
BACKGROUND
The
Company has entered into a Security Agreement dated as of the date hereof (as
amended, modified, restated or supplemented from time to time, the “Security Agreement”),
pursuant to which the Pledgee and the other Creditor Parties (as defined in the
Security Agreement) party thereto provide or will provide certain financial
accommodations to the Company and certain subsidiaries of the
Company.
In order
to induce the Pledgee and the other Creditor Parties to provide or continue to
provide the financial accommodations described in the Security Agreement, each
Pledgor has agreed to pledge and grant a security interest in the collateral
described herein to the Pledgee on the terms and conditions set forth
herein.
NOW,
THEREFORE, in consideration of the premises and for other good and valuable
consideration the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
1.
Defined
Terms. All capitalized terms used herein which are not defined
shall have the meanings given to them in the Security Agreement.
2.
Pledge and Grant
of Security Interest. To secure the full and punctual payment
and performance of (the following clauses (a) and (b), collectively, the “Obligations”) (a) all
obligations owing to Pledgee and the other Creditor Parties under the Security
Agreement and the Ancillary Agreements referred to in the Security Agreement
(the Security Agreement and the Ancillary Agreements, as each may be amended,
restated, modified and/or supplemented from time to time, collectively, the
“Documents”)
and (b) all other obligations and liabilities of each Pledgor to the Pledgee and
the other Creditor Parties whether now existing or hereafter arising, direct or
indirect, liquidated or unliquidated, absolute or contingent, due or not due and
whether under, pursuant to or evidenced by a note, agreement, guaranty,
instrument or otherwise (in each case, irrespective of the validity, regularity
or enforceability of such Obligations, or of any instrument evidencing any of
the Obligations or of any collateral therefor or of the existence or extent of
such collateral, and irrespective of the allowability, allowance or disallowance
of any or all of such in any case commenced by or against any Pledgor under
Xxxxx 00, Xxxxxx Xxxxxx Code, including, without limitation, obligations of each
Pledgor for post-petition interest, fees, costs and charges that would have
accrued or been added to the Obligations but for the commencement of such case),
each Pledgor hereby pledges, assigns, hypothecates, transfers and grants a
security interest to the Pledgee, for the ratable benefit of the Creditor
Parties, in all of the following (the “Collateral”):
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(a) the
shares of stock or other equity interests set forth on Schedule A annexed
hereto and expressly made a part hereof (together with any additional shares of
stock or other equity interests acquired by any Pledgor, the “Pledged Stock”), the
certificates representing the Pledged Stock and all dividends, cash, instruments
and other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the Pledged
Stock;
(b) all
additional shares of stock or other equity interests of any issuer (each, an
“Issuer”) of
the Pledged Stock from time to time acquired by any Pledgor in any manner,
including, without limitation, stock dividends or a distribution in connection
with any increase or reduction of capital, reclassification, merger,
consolidation, sale of assets, combination of shares, stock split, spin-off or
split-off (which shares shall be deemed to be part of the Collateral), and the
certificates representing such additional shares, and all dividends, cash,
instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such shares; and
(c) all
options and rights, whether as an addition to, in substitution of or in exchange
for any shares of any Pledged Stock and all dividends, cash, instruments and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all such options and
rights.
3. Delivery of
Collateral. All certificates representing or evidencing the
Pledged Stock shall be delivered to and held by or on behalf of Pledgee pursuant
hereto and shall be accompanied by duly executed instruments of transfer or
assignments in blank, all in form and substance satisfactory to the
Pledgee. Each Pledgor hereby authorizes the Issuer upon demand by the
Pledgee to deliver any certificates, instruments or other distributions issued
in connection with the Collateral directly to the Pledgee, in each case to be
held by the Pledgee, subject to the terms hereof. Upon the occurrence
and during the continuance of an Event of Default (as defined below), the
Pledgee shall have the right, during such time in its discretion and without
notice to the Pledgor, to transfer to or to register in the name of the Pledgee
or any of its nominees any or all of the Pledged Stock. In addition,
the Pledgee shall have the right at such time to exchange certificates or
instruments representing or evidencing Pledged Stock for certificates or
instruments of smaller or larger denominations.
4. Representations and
Warranties of each Pledgor. Each Pledgor jointly and severally
represents and warrants to the Pledgee (which representations and warranties
shall be deemed to continue to be made until all of the Obligations have been
paid in full in cash and each Document and each agreement and instrument entered
into in connection therewith has been irrevocably terminated) that:
(a) the
execution, delivery and performance by each Pledgor of this Agreement and the
pledge of the Collateral hereunder do not and will not result in any violation
of any agreement, indenture, instrument, license, judgment, decree, order, law,
statute, ordinance or other governmental rule or regulation applicable to any
Pledgor;
(b) this
Agreement constitutes the legal, valid, and binding obligation of each Pledgor
enforceable against each Pledgor in accordance with its terms;
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(c) (i)
all Pledged Stock owned by each Pledgor is set forth on Schedule A hereto and
(ii) each Pledgor is the direct and beneficial owner of each share of the
Pledged Stock;
(d) all
of the shares of the Pledged Stock have been duly authorized, validly issued and
are fully paid and non-assessable;
(e) no
consent or approval of any person, corporation, governmental body, regulatory
authority or other entity, is or will be necessary for (i) the execution,
delivery and performance of this Agreement, (ii) the exercise by the Pledgee of
any rights with respect to the Collateral or (iii) the pledge and assignment of,
and the grant of a security interest in, the Collateral hereunder;
(f) there
are no pending or, to the best of Pledgor’s knowledge, threatened actions or
proceedings before any court, judicial body, administrative agency or arbitrator
which may materially adversely affect the Collateral;
(g)
each Pledgor has the requisite power and authority to enter into this
Agreement and to pledge and assign the Collateral to the Pledgee, for the
ratable benefit of the Creditor Parties, in accordance with the terms of this
Agreement;
(h)
each Pledgor owns each item of the Collateral and, except for the pledge
and security interest granted to the Pledgee hereunder, the Collateral shall be,
immediately following the closing of the transactions contemplated by the
Documents, free and clear of any other security interest, mortgage, pledge,
claim, lien, charge, hypothecation, assignment, offset or encumbrance whatsoever
(collectively, “Liens”);
(i) there
are no restrictions on transfer of the Pledged Stock contained in the
certificate of incorporation or by-laws (or equivalent organizational documents)
of the Issuer or otherwise which have not otherwise been enforceably and legally
waived by the necessary parties;
(j) none
of the Pledged Stock has been issued or transferred in violation of the
securities registration, securities disclosure or similar laws of any
jurisdiction to which such issuance or transfer may be subject;
(k) the
pledge and assignment of the Collateral and the grant of a security interest
under this Agreement vest in the Pledgee, for the ratable benefit of the
Creditor Parties, all rights of each Pledgor in the Collateral as contemplated
by this Agreement; and
(l) the
Pledged Stock constitutes one hundred percent (100%) of the issued and
outstanding shares of capital stock of each Issuer.
5. Covenants. Each
Pledgor jointly and severally covenants that, until the Obligations shall be
indefeasibly satisfied in full in cash and each Document and each agreement and
instrument entered into in connection therewith is irrevocably
terminated:
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(a) No
Pledgor will sell, assign, transfer, convey, or otherwise dispose of its rights
in or to the Collateral or any interest therein; nor will any Pledgor create,
incur or permit to exist any Lien whatsoever with respect to any of the
Collateral or the proceeds thereof other than that created hereby.
(b) Each
Pledgor will, at its expense, defend the Pledgee’s right, title and security
interest in and to the Collateral against the claims of any other
party.
(c) Each
Pledgor shall at any time, and from time to time, upon the written request of
the Pledgee, execute and deliver such further documents and do such further acts
and things as the Pledgee may reasonably request in order to effectuate the
purposes of this Agreement including, but without limitation, delivering to the
Pledgee, upon the occurrence of an Event of Default, irrevocable proxies in
respect of the Collateral in form satisfactory to the Pledgee. Until
receipt thereof, upon an Event of Default that has occurred and is continuing
beyond any applicable grace period, this Agreement shall constitute the
Pledgor’s proxy to the Pledgee or its nominee to vote all shares of Collateral
then registered in each Pledgor’s name.
(d) No
Pledgor will consent to or approve the issuance of (i) any additional shares of
any class of capital stock or other equity interests of the Issuer; or (ii) any
securities convertible either voluntarily by the holder thereof or automatically
upon the occurrence or nonoccurrence of any event or condition into, or any
securities exchangeable for, any such shares, unless, in either case, such
shares are pledged as Collateral pursuant to this Agreement.
(e) Each
Pledgor agrees to execute and deliver to each Issuer that is a limited liability
company or a limited partnership a control acknowledgment (“Control
Acknowledgement”) substantially in the form of Exhibit B
hereto. Each Pledgor shall cause each such Issuer to acknowledge in
writing its receipt and acceptance thereof. Such Control Acknowledgement shall
instruct such Issuer to follow instructions from the Pledgee without any
Pledgor’s consultation or consent.
6. Voting Rights and
Dividends. In addition to the Pledgee’s rights and remedies
set forth in Section 8 hereof, in case an Event of Default shall have occurred
and be continuing, beyond any applicable cure period, the Pledgee shall (i) be
entitled to vote the Collateral, (ii) be entitled to give consents, waivers and
ratifications in respect of the Collateral (each Pledgor hereby irrevocably
constituting and appointing the Pledgee, with full power of substitution, the
proxy and attorney-in-fact of each Pledgor for such purposes) and (iii) be
entitled to collect and receive for its own use cash dividends paid on the
Collateral. Unless and until there shall have occurred and be
continuing an Event of Default, each Pledgor shall be permitted to exercise or
refrain from exercising any voting rights or other powers; provided that, in
each case, no vote shall be cast or any consent, waiver or ratification given or
any action taken or omitted to be taken if, in the reasonable judgment of the
Pledgee, such action would have a material adverse effect on the value of the
Collateral or any part thereof; and, provided, further, that each
Pledgor shall give at least five (5) days’ written notice of the manner in which
such Pledgor intends to exercise, or the reasons for refraining from exercising,
any voting rights or other powers other than with respect to any election of
directors and voting with respect to any incidental
matters. Following the occurrence of an Event of Default, all rights
of each Pledgor to vote and to give consents, waivers and ratifications shall
cease and all dividends and all other distributions in respect of any of the
Collateral, shall be delivered to the Pledgee to hold as Collateral and shall,
if received by any Pledgor, be received in trust for the benefit of the Pledgee,
be segregated from the other property or funds of any other Pledgor, and be
forthwith delivered to the Pledgee as Collateral in the same form as so received
(with any necessary endorsement).
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7. Event of
Default. An “Event of Default”
under this Agreement shall occur upon the happening of any of the following
events:
(a) An
“Event of
Default” under any Document or any agreement or note related to any
Document shall have occurred and be continuing beyond any applicable cure
period;
(b) Any
Pledgor shall default in the performance of any of its obligations under any
Document, including, without limitation, this Agreement, and such default shall
not be cured during the cure period applicable thereto;
(c) Any
representation or warranty of any Pledgor made herein, in any Document or in any
agreement, statement or certificate given in writing pursuant hereto or thereto
or in connection herewith or therewith shall be false or misleading in any
material respect;
(d) Any
portion of the Collateral is subjected to a levy of execution, attachment,
distraint or other judicial process or any portion of the Collateral is the
subject of a claim (other than by the Pledgee) of a Lien or other right or
interest in or to the Collateral and such levy or claim shall not be cured,
disputed or stayed within a period of fifteen (15) Business Days after the
occurrence thereof; or
(e) Any
Pledgor shall (i) apply for, consent to, or suffer to exist the appointment of,
or the taking of possession by, a receiver, custodian, trustee, liquidator or
other fiduciary of itself or of all or a substantial part of its property, (ii)
make a general assignment for the benefit of creditors, (iii) commence a
voluntary case under any state or federal bankruptcy laws (as now or hereafter
in effect), (iv) be adjudicated a bankrupt or insolvent, (v) file a petition
seeking to take advantage of any other law providing for the relief of debtors,
(vi) acquiesce to, or fail to have dismissed, within thirty (30) days, any
petition filed against it in any involuntary case under such bankruptcy laws, or
(vii) take any action for the purpose of effecting any of the
foregoing.
8. Remedies. In
case an Event of Default shall have occurred and is continuing, the Pledgee
may:
(a) Transfer
any or all of the Collateral into its name, or into the name of its nominee or
nominees;
(b) Exercise
all corporate rights with respect to the Collateral including, without
limitation, all rights of conversion, exchange, subscription or any other
rights, privileges or options pertaining to any shares of the Collateral as if
it were the absolute owner thereof, including, but without limitation, the right
to exchange, at its discretion, any or all of the Collateral upon the merger,
consolidation, reorganization, recapitalization or other readjustment of the
Issuer thereof, or upon the exercise by the Issuer of any right, privilege or
option pertaining to any of the Collateral, and, in connection therewith, to
deposit and deliver any and all of the Collateral with any committee,
depository, transfer agent, registrar or other designated agent upon such terms
and conditions as it may determine, all without liability except to account for
property actually received by it; and
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(c) Subject
to any requirement of applicable law, sell, assign and deliver the whole or,
from time to time, any part of the Collateral at the time held by the Pledgee,
at any private sale or at public auction, with or without demand, advertisement
or notice of the time or place of sale or adjournment thereof or otherwise (all
of which are hereby waived, except such notice as is required by applicable law
and cannot be waived), for cash or credit or for other property for immediate or
future delivery, and for such price or prices and on such terms as the Pledgee
in its sole discretion may determine, or as may be required by applicable
law.
Each
Pledgor hereby waives and releases any and all right or equity of redemption,
whether before or after sale hereunder. At any such sale, unless
prohibited by applicable law, the Pledgee may bid for and purchase the whole or
any part of the Collateral so sold free from any such right or equity of
redemption. All moneys received by the Pledgee hereunder, whether
upon sale of the Collateral or any part thereof or otherwise, shall be held by
the Pledgee and applied by it as provided in Section 10 hereof. No
failure or delay on the part of the Pledgee in exercising any rights hereunder
shall operate as a waiver of any such rights nor shall any single or partial
exercise of any such rights preclude any other or future exercise thereof or the
exercise of any other rights hereunder. The Pledgee shall have no
duty as to the collection or protection of the Collateral or any income thereon
nor any duty as to preservation of any rights pertaining thereto, except to
apply the funds in accordance with the requirements of Section 10
hereof. The Pledgee may exercise its rights with respect to property
held hereunder without resort to other security for or sources of reimbursement
for the Obligations. In addition to the foregoing, Pledgee shall have
all of the rights, remedies and privileges of a secured party under the Uniform
Commercial Code of New York (the “UCC”) regardless of
the jurisdiction in which enforcement hereof is sought.
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9.
Private
Sale. Each Pledgor recognizes that the Pledgee may be unable
to effect (or to do so only after delay which would adversely affect the value
that might be realized from the Collateral) a public sale of all or part of the
Collateral by reason of certain prohibitions contained in the Securities Act,
and may be compelled to resort to one or more private sales to a restricted
group of purchasers who will be obliged to agree, among other things, to acquire
such Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. Each Pledgor agrees that any such
private sale may be at prices and on terms less favorable to the seller than if
sold at public sales and that such private sales shall be deemed to have been
made in a commercially reasonable manner. Each Pledgor agrees that
the Pledgee has no obligation to delay sale of any Collateral for the period of
time necessary to permit the Issuer to register the Collateral for public sale
under the Securities Act.
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10. Proceeds of
Sale. The proceeds of any collection, recovery, receipt,
appropriation, realization or sale of the Collateral shall be applied by the
Pledgee as follows:
(a) First,
to the payment of all costs, reasonable expenses and charges of the Pledgee and
to the reimbursement of the Pledgee for the prior payment of such costs,
reasonable expenses and charges incurred in connection with the care and
safekeeping of the Collateral (including, without limitation, the reasonable
expenses of any sale or any other disposition of any of the Collateral),
attorneys’ fees and reasonable expenses, court costs, any other fees or expenses
incurred or expenditures or advances made by the Pledgee in the protection,
enforcement or exercise of its rights, powers or remedies
hereunder;
(b) Second,
to the payment of the Obligations, in whole or in part, in such order as the
Pledgee may elect, whether or not such Obligations are then due;
(c) Third,
to such persons, firms, corporations or other entities as required by applicable
law including, without limitation, Section 9-615(a)(3) of the UCC;
and
(d) Fourth,
to the extent of any surplus to the Pledgors or as a court of competent
jurisdiction may direct.
In the
event that the proceeds of any collection, recovery, receipt, appropriation,
realization or sale are insufficient to satisfy the Obligations, each Pledgor
shall be jointly and severally liable for the deficiency plus the costs and fees
of any attorneys employed by the Pledgee to collect such
deficiency.
11. Waiver of
Marshaling. Each Pledgor hereby waives any right to compel any
marshaling of any of the Collateral.
12. No
Waiver. Any and all of the Pledgee’s rights with respect to
the Liens granted under this Agreement shall continue unimpaired, and Pledgor
shall be and remain obligated in accordance with the terms hereof,
notwithstanding (a) the bankruptcy, insolvency or reorganization of any Pledgor,
(b) the release or substitution of any item of the Collateral at any time, or of
any rights or interests therein, or (c) any delay, extension of time, renewal,
compromise or other indulgence granted by the Pledgee in reference to any of the
Obligations. Each Pledgor hereby waives all notice of any such delay,
extension, release, substitution, renewal, compromise or other indulgence, and
hereby consents to be bound hereby as fully and effectively as if such Pledgor
had expressly agreed thereto in advance. No delay or extension of
time by the Pledgee in exercising any power of sale, option or other right or
remedy hereunder, and no failure by the Pledgee to give notice or make demand,
shall constitute a waiver thereof, or limit, impair or prejudice the Pledgee’s
right to take any action against any Pledgor or to exercise any other power of
sale, option or any other right or remedy.
13. Expenses. The
Collateral shall secure, and each Pledgor shall pay to the Pledgee on demand,
from time to time, all reasonable costs and expenses, (including but not limited
to, reasonable attorneys’ fees and costs, taxes, and all transfer, recording,
filing and other charges) of, or incidental to, the custody, care, transfer,
administration of the Collateral or any other collateral, or in any way relating
to the enforcement, protection or preservation of the rights or remedies of the
Pledgee under this Agreement or with respect to any of the
Obligations.
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14.
The Pledgee Appointed
Attorney-In-Fact and Performance by the Pledgee. Upon the
occurrence of an Event of Default, each Pledgor hereby irrevocably constitutes
and appoints the Pledgee as such Pledgor’s true and lawful attorney-in-fact,
with full power of substitution, to execute, acknowledge and deliver any
instruments and to do in such Pledgor’s name, place and stead, all such acts,
things and deeds for and on behalf of and in the name of such Pledgor, which
such Pledgor could or might do or which the Pledgee may deem necessary,
desirable or convenient to accomplish the purposes of this Agreement, including,
without limitation, to execute such instruments of assignment or transfer or
orders and to register, convey or otherwise transfer title to the Collateral
into the Pledgee’s name. Each Pledgor hereby ratifies and confirms
all that said attorney-in-fact may so do and hereby declares this power of
attorney to be coupled with an interest and irrevocable. If any
Pledgor fails to perform any agreement herein contained, the Pledgee may itself
perform or cause performance thereof, and any costs and expenses of the Pledgee
incurred in connection therewith shall be paid by the Pledgors as provided in
Section 10 hereof.
15.
Recapture. Notwithstanding
anything to the contrary in this Agreement, if the Pledgee or any other Creditor
Party receives any payment or payments on account of the Obligations, which
payment or payments or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver, or any other party under the United States Bankruptcy Code,
as amended, or any other federal or state bankruptcy, reorganization, moratorium
or insolvency law relating to or affecting the enforcement of creditors’ rights
generally, common law or equitable doctrine, then to the extent of any sum not
finally retained by the Pledgee or such other Creditor Party, each Pledgor’s
obligations to the Pledgee and the other Creditor Parties shall be reinstated
and this Agreement shall remain in full force and effect (or be reinstated)
until payment shall have been made to the Pledgee and the other Creditor
Parties, which payment shall be due on demand.
16. Captions. All
captions in this Agreement are included herein for convenience of reference only
and shall not constitute part of this Agreement for any other
purpose.
17. Termination of Security
Interest. The security interest and rights granted to the
Agent hereunder shall continue in full force and effect, notwithstanding the
termination of this Agreement and the Ancillary Agreements, until all of the
Obligations have been indefeasibly paid or performed in full and this Agreement
has been terminated in accordance with the terms of this
Agreement. The Agent shall not be required to send termination
statements or other evidence of the release of the security interest granted
hereunder to any Company, or to file them with any filing office, unless and
until this Agreement and the Ancillary Agreements shall have been terminated in
accordance with their terms and all Obligations indefeasibly paid in full in
immediately available funds.
18. Miscellaneous.
(a) This
Agreement constitutes the entire and final agreement among the parties with
respect to the subject matter hereof and may not be changed, terminated or
otherwise varied except by a writing duly executed by the parties
hereto.
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(b) No
waiver of any term or condition of this Agreement, whether by delay, omission or
otherwise, shall be effective unless in writing and signed by the party sought
to be charged, and then such waiver shall be effective only in the specific
instance and for the purpose for which given.
(c) In
the event that any provision of this Agreement or the application thereof to any
Pledgor or any circumstance in any jurisdiction governing this Agreement shall,
to any extent, be invalid or unenforceable under any applicable statute,
regulation, or rule of law, such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform to
such statute, regulation or rule of law, and the remainder of this Agreement and
the application of any such invalid or unenforceable provision to parties,
jurisdictions, or circumstances other than to whom or to which it is held
invalid or unenforceable shall not be affected thereby, nor shall same affect
the validity or enforceability of any other provision of this
Agreement.
(d) This
Agreement shall be binding upon each Pledgor, and each Pledgor’s successors and
assigns, and shall inure to the benefit of the Pledgee and its successors and
assigns for the ratable benefit of the Creditor Parties.
(e) Any
notice or other communication required or permitted pursuant to this Agreement
shall be given in accordance with the Security Agreement.
(f) THIS
AGREEMENT AND THE OTHER DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW.
(g) EACH
PLEDGOR HEREBY CONSENTS AND AGREES THAT THE STATE AND/OR FEDERAL COURTS LOCATED
IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION
TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN ANY PLEDGOR, ON THE ONE
HAND, AND THE PLEDGEE AND/OR ANY OTHER CREDITOR PARTY, ON THE OTHER HAND,
PERTAINING TO THIS AGREEMENT OR ANY OF THE OTHER DOCUMENTS OR TO ANY MATTER
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR ANY OF THE OTHER DOCUMENTS, PROVIDED, THAT EACH
PLEDGOR ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY
A COURT LOCATED OUTSIDE OF THE COUNTY OF NEW YORK, STATE OF NEW YORK; AND FURTHER PROVIDED, THAT
NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE THE PLEDGEE OR
ANY OTHER CREDITOR PARTY FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY
OTHER JURISDICTION TO COLLECT THE INDEBTEDNESS, TO REALIZE ON THE COLLATERAL OR
ANY OTHER SECURITY FOR THE INDEBTEDNESS, OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER IN FAVOR OF THE PLEDGEE AND/OR ANY OTHER CREDITOR PARTY. EACH
PLEDGOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY
ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PLEDGOR HEREBY WAIVES ANY
OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER
VENUE OR FORUM
NON CONVENIENS. EACH
PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER
PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL
ADDRESSED TO SUCH PLEDGOR AT THE ADDRESS SET FORTH IN THE SECURITY AGREEMENT AND
THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF SUCH
PLEDGOR’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S.
MAILS, PROPER POSTAGE PREPAID.
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(h) THE
PARTIES HERETO DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE
BENEFITS OF THE JUDICIAL SYSTEM AND/OR OF ARBITRATION, THE PARTIES HERETO WAIVE
ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO
RESOLVE ANY DISPUTE, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE
PLEDGEE AND/OR ANY OTHER CREDITOR PARTY, ON THE ONE HAND, AND/OR ANY PLEDGOR, ON
THE OTHER HAND, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, ANY
OTHER DOCUMENT OR THE TRANSACTIONS RELATED HERETO OR THERETO.
(i)
It is understood and agreed that any person or entity that
desires to become a Pledgor hereunder, or is required to execute a counterpart
of this Agreement after the date hereof pursuant to the requirements of any
Document, shall become a Pledgor hereunder by (x) executing a Joinder
Agreement in form and substance satisfactory to the Pledgee, (y) delivering
supplements to such exhibits and annexes to such Documents as the Pledgee shall
reasonably request and/or set forth in such joinder agreement and (z) taking all
actions as specified in this Agreement as would have been taken by such Pledgor
had it been an original party to this Agreement, in each case with all documents
required above to be delivered to the Pledgee and with all documents and actions
required above to be taken to the reasonable satisfaction of the
Pledgee.
(j)
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original and all of which when taken together shall
constitute one and the same agreement. Any signature delivered by a
party by facsimile or electronic transmission shall be deemed an original
signature hereto.
[Remainder
of Page Intentionally Left Blank]
10
IN
WITNESS WHEREOF, the parties have duly executed this Agreement as of the day and
year first written above.
RAPID
LINK, INCORPORATED
|
|||
By:
|
|||
Name:
|
|||
Title:
|
|||
LV
ADMINISTRATIVE SERVICES INC.,
|
|||
as
Agent
|
|||
By:
|
|||
Name:
|
|||
Title:
|
Authorized
Signatory
|
11
SCHEDULE
A
Pledged
Stock
Pledgor
|
Issuer
|
Class of Stock
|
Stock Certificate Number
|
Par Value
|
Number of Shares
|
% of outstanding Shares
|
Rapid
Link, Incorporated
|
Telenational
Communications, Inc.
|
COMMON
|
003
|
.0001
|
1,000
|
100%
|
Rapid
Link, Incorporated
|
DTI
Com, Inc.
|
COMMON
|
005
|
.001
|
1,000
|
100%
|
Rapid
Link, Incorporated
|
Canmax
Retail Systems, Inc.
|
COMMON
|
002
|
1.00
|
1,000
|
100%
|
Rapid
Link, Incorporated
|
One
Ring Networks, Inc.
|
COMMON
|
.001
|
11,971,427
|
100%
|
12
EXHIBIT
A
Form of Irrevocable Stock
Power
FOR VALUE
RECEIVED, the undersigned hereby sells, assigns and transfers to the following
shares of stock of _________________________, a Delaware
corporation:
No. of
Shares
|
Certificate
No.
|
and
irrevocably appoints __________________________________ its agent and
attorney-in-fact to transfer all or any part of such stock and to take all
necessary and appropriate action to effect any such transfer. The
agent and attorney-in-fact may substitute and appoint one or more persons to act
for him. The effectiveness of a transfer pursuant to this stock power
shall be subject to any and all transfer restrictions referenced on the face of
the certificates evidencing such interest or in the certificate of incorporation
or bylaws of the subject corporation, to the extent they may from time to time
exist.
Rapid
Link, Incorporated
|
||
a
Delaware corporation
|
||
By:
|
||
Name:
|
||
Title:
|
13
EXHIBIT
B
FORM OF CONTROL
ACKNOWLEDGMENT
Reference
is hereby made to that certain Stock Pledge Agreement, dated as of March ____,
2008 (as amended, restated, modified and/or supplemented from time to time, the
“Pledge
Agreement”), between Rapid Link, Incorporated (the “Pledgor”), the member
of ____________, a ___________ [limited liability company] [limited partnership]
(the “Issuer”),
and LV Administrative Services Inc., as administrative and collateral agent for
the Creditor Parties (as defined therein) (the “Agent”). Capitalized
terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Pledge Agreement.
The
Issuer is hereby instructed by the Pledgor that all of the Pledgor’s right,
title and interest in and to all of the Pledgor’s rights in connection with any
[membership] [partnership] interests in the Issuer now and hereafter owned by
the Pledgor are subject to a pledge and security interest in favor of the Agent,
for the ratable benefit of the Creditor Parties. The Pledgor hereby
instructs the Issuer to act upon any instruction delivered to it by the Agent
with respect to the Collateral without seeking further instruction from the
Pledgor, and, by its execution hereof, the Issuer hereby agrees to do
so.
The
Issuer, by its written acknowledgment and acceptance hereof, hereby acknowledges
receipt of a copy of the Pledge Agreement and agrees promptly to note on its
books the security interest granted under the Pledge Agreement. The
Issuer also waives any rights or requirements at any time hereafter to receive a
copy of the Pledge Agreement in connection with the registration of any
Collateral in the name of the Agent or its nominee or the exercise of voting
rights by the Agent or its nominee.
[Remainder
of this page intentionally left blank]
1
IN
WITNESS WHEREOF, the Pledgor has caused this Control Acknowledgment to be duly
signed and delivered by its officer duly authorized as of this _____ day of
___________ 20___.
RAPID
LINK, INCORPORATED
|
||
By:
|
||
Name:
|
||
Title:
|
Acknowledged
and accepted this
______
day of __________ 20___.
[ISSUER]
By:
|
||
Name:
|
||
Title:
|
2