PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (this "Agreement"), dated as of August
___, 2003 between iDial Networks, Inc., a Nevada corporation ("Pledgor") and The
Titan Corporation, a Delaware corporation (together with its successors and
assigns, "Secured Party").
WHEREAS, Pledgor, as assignee of GlobalNet Systems, Inc., and
Secured Party entered into that certain Stock Purchase Agreement dated as May
20, 2003 (the "Stock Purchase Agreement") with GlobalNet, Inc. (the "Company"),
pursuant to which, among other things, Secured Party has agreed to sell and
Pledgor has agreed to purchase all of the issued and outstanding shares of
common stock, no par value, of the Company and Secured Party has agreed to
assign the GlobalNet Notes (as defined herein) to Growth Enterprise Fund, S.A.
("GEF");
WHEREAS, Secured Party has entered into that certain Guaranty
dated as of Xxxxx 00, 0000 (xxx "XXXX Xxxxxxxx"), for the benefit of General
Electric Capital Corporation ("GECC") pursuant to which Secured Party has agreed
to guaranty the regular and punctual payment of GlobalNet International LLC's
obligations under that certain Master Lease Agreement Xx. 0000000 dated June 6,
2000 between GECC and GlobalNet International LLC (the "GECC Master Lease");
WHEREAS, pursuant to Section 1.2 of the Stock Purchase
Agreement, Pledgor agreed to release Secured Party from Secured Party's
outstanding obligations under the GECC Guaranty;
WHEREAS, pursuant to that certain letter agreement dated as of
the date hereof among Pledgor, Secured Party and the Company, Secured Party has
agreed to waive Pledgor's delivery of Secured Party's release from the GECC
Guaranty pursuant to Section 8.4(b) of the Stock Purchase Agreement, in
consideration for Pledgor agreeing to reimburse Titan for any payment made by
Titan under the GECC Guaranty pursuant to that certain Reimbursement Agreement
dated as of the date hereof between Pledgor and Secured Party (the
"Reimbursement Agreement");
WHEREAS, in connection with the Settlement Agreement entered
into on the date hereof among the Secured Party, GlobalNet Systems, Inc. and
GEF, Pledgor, who materially benefits from such Settlement Agreement, has issued
a promissory note in the amount of One Million Five Hundred Thousand Dollars
($1,500,000) to Secured Party (the "Promissory Note");
WHEREAS, in connection with the closing on the date hereof,
GEF has assigned the GlobalNet Notes to Pledgor;
WHEREAS, in connection with the closing under the Stock
Purchase Agreement on the date hereof (the "Closing"), Pledgor has agreed to
execute and deliver this Agreement and to pledge hereunder the Collateral (as
defined herein) to Secured Party, as security for (i) Pledgor's obligations
under the Promissory Note and (ii) Pledgor's obligations under the Reimbursement
Agreement (collectively, the "Obligations").
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. DEFINITIONS
Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Stock Purchase Agreement. The
following terms, as used in this Agreement, shall have the following meanings:
"Collateral Records" means books, records, ledger cards,
files, computer printouts, tapes, disks and related data processing software and
similar items that at any time evidence or contain information relating to any
of the Collateral or are otherwise necessary or helpful in the collection
thereof or realization thereupon.
"Company Shares" means the shares of Common Stock, no par
value, of the Company.
"Event of Default" The occurrence of any of the following
shall constitute an event of default ("Event of Default") hereunder:
(a) Failure of Pledgor to pay, when due, the principal, any
interest or any other sum payable under the Promissory Note and such failure
continues for three (3) business days;
(b) Failure of the Company or GlobalNet International LLC to
pay, when due, any amount to GECC under the GECC Master Lease and such failure
continues for three (3) business days;
(c) The failure of Pledgor generally to pay its debts as such
debts become due, the admission by Pledgor in writing of its inability to pay
its debts as such debts become due, or the making by Pledgor of any general
assignment for the benefit of creditors; or
(d) If pursuant to or within the meaning of the United States
Bankruptcy Code or any other federal or state law relating to insolvency or
relief of debtors, Pledgor shall (i) commence a voluntary case or proceeding;
(ii) consent to the entry of an order for relief against it in an involuntary
case; or (iii) consent to the appointment of a trustee, receiver, assignee,
liquidator or similar official.
"GlobalNet Notes" means collectively, that certain Amended and
Restated Term Note dated as of August 30, 2002 made by the Company for the
benefit of Secured Party in the principal amount of Eleven Million Three Hundred
Thousand Dollars ($11,300,000) and that certain Promissory Note dated as of July
24, 2003 made by the Company for the benefit of Secured Party in the principal
amount of Three Million One Hundred Sixty One Thousand Two Hundred Fifty Eight
Dollars ($3,161,258).
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"Pledged Shares" means the Company Shares owned by Pledgor
described on Schedule A under the heading "Pledged Shares" (as such schedule may
be amended or supplemented from time to time), and the certificates, if any,
representing such shares, all security entitlement pertaining to such shares,
and all dividends, distributions, cash, warrants, rights, options, instruments,
securities 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.
"Proceeds" means (i) all "proceeds" as defined in the UCC,
(ii) payments or distributions made with respect to any Collateral and (iii)
whatever is receivable or received when Collateral or proceeds are sold,
exchanged, collected or otherwise disposed of, whether such disposition is
voluntary or involuntary.
"UCC" means the Uniform Commercial Code as in effect from time
to time in the Commonwealth of Virginia or, when the context implies, the
Uniform Commercial Code as in effect from time to time in any other applicable
jurisdiction.
2. PLEDGE OF COLLATERAL
2(a) As security for the due and punctual payment and performance by Pledgor of
all of its Obligations and its obligations under this Agreement (collectively,
the "Secured Obligations"), Pledgor hereby pledges and assigns to Secured Party,
a first priority security interest in and continuing lien on all of Pledgor's
right, title and interest in, to and under the following, in each case whether
now owned or existing or hereafter acquired or arising and wherever located (all
of which being hereinafter collectively referred to as the "Collateral"):
(i) all Pledged Shares;
(ii) the GlobalNet Notes;
(iii) to the extent not otherwise included above, all Collateral Records
relating to any of the foregoing; and
(iv) to the extent not otherwise included above, all Proceeds, products,
accessions, rents and profits of or in respect of any of the foregoing.
2(b) Simultaneously with the execution of this Agreement, Pledgor
is delivering to Secured Party a certificate representing the Pledged Shares and
such certificate shall be duly endorsed in blank or accompanied by a stock power
duly executed by Pledgor in blank, and the GlobalNet Notes, accompanied by an
assignment executed in blank, together with any documentary tax stamps and any
other documents necessary to cause Secured Party to have a good, valid and
perfected first pledge of, lien on and security interest in the Collateral, free
and clear of any mortgage, pledge, lien, security interest, hypothecation,
assignment, charge, right, encumbrance or restriction (individually,
"Encumbrance" and collectively, "Encumbrances").
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2(c) At any time following an Event of Default, any or all shares
of the Collateral held by Secured Party hereunder may at the option of Secured
Party exercised in accordance with Section 3(d) hereof, be registered in the
name of Secured Party, and Pledgor hereby covenants that, upon demand therefor
by Secured Party, Pledgor shall use its best efforts to cause the Company to
effect such registration.
2(d) Pledgor grants Secured Party the right, at Secured
Party's option, to file any or all such financing statements, continuation
statements and other documents pursuant to the UCC, any other applicable law or
otherwise, without Pledgor's signature, and irrevocably appoints Secured Party
as Pledgor's attorney in fact to execute any such statements and documents in
Pledgor's name and to perform all other acts which Secured Party deems
appropriate to perfect and continue the security interest conferred by this
Agreement. Pledgor authorizes Secured Party to file one or more Uniform
Commercial Code financing statements or continuation statements relating to all
or any part of the Collateral without the signature of Pledgor where permitted
by law. Any such financing statements may be signed by Secured Party on behalf
of Pledgor and may be filed at any time in any jurisdiction whether on not
Revised Article 9 is then in effect in that jurisdiction.
3. VOTING RIGHTS, DIVIDENDS AND DISTRIBUTIONS
So long as no Event of Default shall have occurred and be
continuing:
3(a) Pledgor shall be entitled to exercise any and all voting
and/or consensual rights and powers relating or pertaining to the Collateral or
any part thereof, subject to the terms hereof.
3(b) Pledgor shall be entitled to receive and retain cash
dividends payable on the Collateral; provided, however, that all other dividends
(including, without limitation, stock and liquidating dividends), distributions
in property, returns of capital and other distributions made on or in respect of
the Collateral, whether resulting from a subdivision, combination or
reclassification of the outstanding capital stock of Company or received in
exchange for the Collateral or any part thereof or as a result of any merger,
consolidation, acquisition or other exchange of assets to which Company may be a
party or otherwise, and any and all cash and other property received in exchange
for or redemption of any of the Collateral, shall be retained by Secured Party,
or, if delivered to Pledgor, shall be held in trust for the benefit of Secured
Party and forthwith delivered to Secured Party and shall be considered as part
of the Collateral for all purposes of this Agreement.
3(c) Secured Party shall execute and deliver (or cause to be
executed and delivered) to Pledgor all such proxies, powers of attorney,
dividend orders, and other instruments as Pledgor may request for the purpose of
enabling Pledgor to exercise the voting and/or consensual rights and powers
which Pledgor is entitled to exercise pursuant to Section 3(a) above and/or to
receive the dividends which Pledgor is authorized to receive and retain pursuant
to Section 3(b) above; and Pledgor shall execute and deliver to Secured Party
such instruments as may be required or may be requested by Secured Party to
enable Secured Party to receive and retain the dividends, distributions in
property, returns of capital and other distributions it is authorized to receive
and retain pursuant to Section 3(b) above.
3(d) Upon the occurrence and during the continuance of an Event
of Default, all rights of Pledgor to exercise the voting and/or consensual
rights and powers which Pledgor is entitled to exercise pursuant to Section 3(a)
above and/or to receive the dividends which Pledgor is authorized to receive and
retain pursuant to Section 3(b) above shall cease, at the option of Secured
Party (if so directed by Secured Party), and all such rights shall thereupon
become vested in Secured Party, who shall have the sole and exclusive right and
authority to exercise such voting and/or consensual rights and powers and/or to
receive and retain such dividends. In such case Pledgor shall execute and
deliver such documents as Secured Party may request to enable Secured Party to
exercise such rights and receive such dividends. In addition, Secured Party is
hereby appointed the attorney-in-fact of Pledgor, with full power of
substitution, which appointment as attorney-in-fact is irrevocable and coupled
with an interest, to take all such actions after the occurrence and during the
continuance of an Event of Default, whether in the name of Secured Party or
Pledgor, as Secured Party may consider necessary or desirable for the purpose of
exercising such rights and receiving such dividends. Any and all money and other
property paid over to or received by Secured Party pursuant to the provisions of
this Section 3(d) shall be retained by Secured Party as part of the Collateral
and shall be applied in accordance with the provisions hereof.
4. REMEDIES ON DEFAULT
4(a) If at any time an Event of Default shall have occurred and
be continuing, then Secured Party may, in addition to having the right to
exercise any right or remedy of a secured party upon default under the UCC, to
the extent permitted by law, without being required to give any notice to
Pledgor except as provided below:
(i) Apply any cash held by it hereunder in the manner
provided in Section 4(c) below; and
(ii) Subject to Section 4(d), if there shall be no such cash
or if the cash so applied shall be insufficient to pay in full the items
specified in Sections 4(c)(i) and (c)(ii) below, collect, receive, appropriate
and realize upon the Collateral or any part thereof, and/or, Secured Party may,
sell, assign, contract to sell or otherwise dispose of and deliver the
Collateral or any part thereof, in its entirety or in portions, at public or
private sale or at any broker's board, on any securities exchange or at any of
Secured Party's residences or elsewhere, for cash, upon credit or for future
delivery, and at such price or prices as Secured Party may deem best, and
Secured Party may (except as otherwise provided by law) be the purchaser of any
or all of the Collateral so sold and thereafter may hold the same, absolutely,
free from any right or claim of whatsoever kind.
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In the event of a sale as aforesaid, Secured Party is authorized
to, at any such sale, if it deems it advisable so to do, restrict the number of
prospective bidders or purchasers and/or further restrict such prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing for their own account, for investment, and not with a view to the
distribution or resale of the Collateral, and may otherwise require that such
sale be conducted subject to restrictions as to such other matters as Secured
Party may deem necessary in order that such sale may be effected in such manner
as to comply with all applicable state and federal securities laws. Upon any
such sale, Secured Party shall have the right to deliver, assign and transfer to
the purchaser thereof the Collateral so sold.
Pledgor hereby acknowledges that, notwithstanding that a higher
price might be obtained for the Collateral at a public sale than at a private
sale or sales, the making of a public sale of the Collateral may be subject to
registration requirements under applicable securities laws and similar other
legal restrictions compliance with which would require such actions on the part
of Pledgor, would entail such expenses, and would subject Secured Party, any
underwriter through whom the Collateral may be sold and any controlling person
of any of the foregoing to such liabilities, as would make a public sale of the
Collateral impractical. Accordingly, Pledgor hereby agrees that private sales
made by Secured Party in good faith in accordance with the provisions of this
Section 4(a) may be at prices and on other terms less favorable to the seller
than if the Collateral were sold at public sale, and that Secured Party shall
not have any obligation to take any steps in order to permit the Collateral to
be sold at public sale, a private sale being considered or deemed to be a sale
in a commercially reasonable manner.
Each purchaser at any such sale shall hold the property sold,
absolutely, free from any claim or right of whatsoever kind, including any
equity or right of redemption of Pledgor, who hereby specifically waives all
rights of redemption, stay or appraisal which Pledgor has or may have under any
rule of law or statute now existing or hereafter adopted. Secured Party shall
give Pledgor not less than ten (10) days' written notice of its intention to
make any such public or private sale. Such notice, in case of a public sale,
shall state the time and place fixed for such sale, and, in case of a sale at
broker's board, on a securities exchange or elsewhere, shall state the board,
exchange or other location at which such sale is to be made and the day on which
the Collateral, or that portion thereof so being sold, will first be offered for
sale at such location. Such notice, in case of a private sale, shall state only
the date on or after which such sale may be made. Any such notice given as
aforesaid shall be deemed to be reasonable notification.
Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as Secured Party may fix in
the notice of such sale. At any sale the Collateral may be sold in one lot as an
entirety or in parts, as Secured Party may determine. Secured Party shall not be
obligated to make any sale pursuant to any such notice. Secured Party may,
without notice or publication, adjourn 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 on credit or
for future delivery, the Collateral so sold may be retained by Secured Party
until the selling price is paid by the purchaser thereof, but
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the Secured Party shall not incur any liability in case of the failure of such
purchaser to take up and pay for the Collateral so sold and, in case of any such
failure, such Collateral may again be sold upon like notice.
Secured Party, 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 its lien or security interest arising from this Agreement and sell the
Collateral, or any portion thereof, under a judgment or decree of a court or
courts of competent jurisdiction.
Upon the occurrence of an Event of Default, Secured Party or its
nominee shall have the right to exercise any and 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, 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 Company, or upon the exercise by
Company of any right, privilege or option pertaining to any such shares 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 agency upon such terms and conditions as Secured Party may
determine.
On any sale of the Collateral, Secured Party is hereby authorized
to comply with any limitation or restriction in connection with such sale that
it may be advised by counsel is necessary in order to avoid any violation of
applicable law or in order to obtain any required approval of the purchaser or
purchasers by any governmental regulatory authority or officer or court.
It is expressly understood and agreed by Pledgor that Secured
Party may exercise its rights under any other document providing security for
the Secured Obligations without exercising its rights or affecting the security
provided hereunder, and it is further understood and agreed by Pledgor that
Secured Party may proceed against all or any portion or portions of the
Collateral and all other collateral securing the Secured Obligations in such
order and at such time as Secured Party, in its sole discretion, sees fit; and
Pledgor hereby expressly waives any rights under the doctrine of marshalling of
assets.
Compliance with the foregoing procedures shall result in such
sale or disposition being considered or deemed to have been made in a
commercially reasonable manner.
4(b) Each of the rights, powers, and remedies provided herein, in
the Promissory Note or in any other document providing security for the Secured
Obligations or now or hereafter existing at law or in equity or by statute or
otherwise shall be cumulative and concurrent and shall be in addition to every
other right, power or remedy provided for herein or therein or now or hereafter
existing at law or in equity or by statute or otherwise. The exercise of any
such right, power or remedy shall not preclude the simultaneous or later
exercise of any or all other such rights, powers or remedies. No notice to or
demand on Pledgor in any case shall entitle Pledgor to any other notice or
demand in similar or other circumstances.
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4(c) The proceeds of any collection, recovery, receipt,
appropriation, realization or sale as aforesaid shall be applied by Secured
Party in the following order:
(i) First, to the payment of all costs and expenses of every
kind incurred by Secured Party in connection therewith or incidental to the
care, safekeeping or otherwise of any of the Collateral, including, without
limitation, reasonable attorneys' fees and expenses; and
(ii) Second, to the payment of any amounts due under the
Secured Obligations.
4(d) Notwithstanding anything to the contrary set forth herein,
Secured Party agrees that to the extent prior approval of the Federal
Communications Commission (the "FCC") is required pursuant to the Communications
Act of 1934, as amended (the "Communications Act"), for (i) the exercise of any
right or remedy hereunder, or (ii) taking any action that may be taken by
Secured Party hereunder, such exercise or action will be subject to such prior
FCC approval having been obtained by or in favor of Secured Party (and Pledgor
will use its best efforts to obtain any such approval as promptly as possible).
Pledgor agrees that, upon the occurrence and during the continuance of an Event
of Default and at Secured Party's request, Pledgor will immediately file, or
cause to be filed, such applications for approval and shall take all other and
further actions required by the Secured Party, on behalf of Secured Party to
obtain such approval as is necessary to transfer ownership and control to
Secured Party, on behalf of Secured Party, or its successors or assigns, of the
Collateral. In order to enforce the provisions of this Section 4(d), Secured
Party is empowered to request the appointment of a receiver from any court of
competent jurisdiction. Such receiver shall be instructed to seek from the FCC
its consent to an involuntary assignment or transfer of control of any FCC
Licenses for the purpose of acquiring such FCC Licenses and thereupon seeking a
bona fide third-party purchaser to whom such FCC Licenses, or the control
thereof, will ultimately be assigned or transferred. Pledgor hereby agrees to
authorize, and to cooperate fully in effectuating, such an assignment or
transfer of control, upon the request of the receiver so appointed and, if
Pledgor shall refuse to authorize or to cooperate fully in effectuating such
assignment or transfer, Pledgor's approval and cooperation may be required by
the court. Upon the occurrence and during the continuance of an Event of
Default, Pledgor shall further use its best efforts to assist in obtaining the
approval of the FCC, if required, for any action or transactions contemplated by
this Agreement, including the preparation, execution, and filing with the FCC of
the assignor's or the transferor's and licensee's portions of any application or
applications for the FCC's consents to the voluntary or involuntary assignments
of any FCC Licenses or the voluntary or involuntary transfers of control thereof
necessary or appropriate under the FCC's rules and regulations for the
assignment or transfer of any portion of the Collateral, together with any FCC
Licenses or other authorization. Pledgor acknowledges that the assignment or
transfer of any interest in the FCC Licenses hereunder is integral to the
Secured Party's realization of the value of the Collateral, that there is no
adequate remedy at law for a failure by Pledgor to comply with the provisions of
this Section 4(d), and that such failure would not be adequately compensable in
damages, and therefore agrees that the Pledgor's
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obligations set forth in this Section 4(d) may be specifically enforced by a
court of competent jurisdiction.
Notwithstanding anything to the contrary contained in this
Agreement, Secured Party shall not, without first obtaining the approval of the
FCC, take any action pursuant to this Agreement which would constitute or result
in any acquisition or transfer of control of the Pledgor, or the assignment of
any FCC License, if such acquisition, transfer, or assignment would require,
under then existing law (including the written rules and regulations promulgated
by the FCC), the prior approval of the FCC.
Secured Party acknowledges that after the occurrence of an Event
of Default, all requisite consents of the FCC must be obtained prior to the
exercise by Secured Party or by a bona fide third-party purchaser at a public or
private sale, of control of any FCC License.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF PLEDGOR
Pledgor represents, warrants and covenants that:
5(a) Pledgor has all requisite capacity, power and authority,
being under no legal restriction, limitation or disability, to own the
Collateral and to execute, deliver and perform this Agreement.
5(b) This Agreement has been duly authorized, executed and
delivered by Pledgor and constitutes a legal, valid, and binding obligation of
Pledgor, enforceable in accordance with its terms.
Pledgor is the record and beneficial owner of each share of the Collateral set
forth next to Pledgor's name on Schedule A. Pledgor has and will have good,
valid and marketable title to the Collateral, free and clear of all Encumbrances
other than the security interest created by this Agreement and the liens on all
of the assets of Pledgor, including the Collateral, held by AJW Partners, LLC,
AJW Offshore, Ltd., AJW Qualified Partners, LLC, New Millennium Capital Partners
II, LLC and AJW Managed Account (the "Investors"); provided, however, that the
parties hereby acknowledge that the security interest created by this Agreement
in favor of Secured Party will have priority over any security interest held by
the Investors in the Collateral.
5(c) All of the shares of the Collateral have been duly and
validly issued, fully paid and nonassessable.
5(d) The Collateral is and will be duly and validly pledged for
the benefit of Secured Party in accordance with law, and the Secured Party has
and will have a good, valid, and perfected first lien on and security interest
in the Collateral and the proceeds thereof.
5(e) The execution, delivery and performance by Pledgor of this
Agreement does not and will not: (i) conflict with or result in a breach of or
constitute
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a default or require any consent (which has not been obtained) under, or result
in or require the acceleration of any of its indebtedness pursuant to, any
agreement, indenture or other instrument to which Pledgor is a party or by which
Pledgor may be bound or affected; or (ii) conflict with or violate any judgment,
decree, order, law, statute, ordinance, license or other governmental rule or
regulation applicable to Pledgor.
5(f) No approval, consent or other action by Pledgor, any
governmental authority, or any other person or entity is or will be necessary to
permit the valid execution, delivery or performance of this Agreement by
Pledgor.
5(g) There is no action, claim, suit, proceeding or investigation
pending, or to the knowledge of Pledgor, threatened or reasonably anticipated,
against or affecting Pledgor, this Agreement, or the transactions contemplated
hereby, before or by any court, arbitrator or governmental authority which might
adversely affect Pledgor's ability to perform its obligations under this
Agreement or might materially adversely affect the value of the Collateral.
5(h) No effective financing statement naming Pledgor as debtor,
assignor, grantor, mortgagor, pledgor or the like and covering all or any part
of the Collateral is on file in any filing or recording office in any
jurisdiction.
5(i) Until all Secured Obligations have been performed in full,
Pledgor hereby covenants that, unless Secured Party otherwise consents in
advance in writing:
(i) Pledgor shall defend the Collateral and Secured Party's
interest therein against all claims and demands of all persons at any time
claiming the same or any interest therein adverse to Secured Party, and pay all
costs and expenses (including, without limitation, reasonable attorneys' fees
and expenses) in connection with such defense.
(ii) Pledgor shall not sell, transfer, pledge, assign or
otherwise dispose of any of the Collateral or any interest therein, and Pledgor
shall not create, incur, assume or suffer to exist any Encumbrance with respect
to any of the Collateral or any interest therein (except pursuant hereto).
(iii) Pledgor shall not take or permit to be taken any
action in connection with the Collateral or otherwise which would impair the
value of the interests or rights of Pledgor therein or which would impair the
interests or rights of Secured Party therein or with respect thereto.
6. FEES AND EXPENSES OF SECURED PARTY
Secured Party shall be reimbursed by Pledgor for its out of
pocket expenses, including, without limitation, reasonable attorneys' fees,
incurred in effecting any of the transactions and responsibilities described
herein. Pledgor shall reimburse Secured Party for, and save Secured Party
harmless from and against liability for the payment of, all out-of-pocket
expenses arising in connection with the
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enforcement of, or for the preservation or exercise of any rights (including the
right to realize upon the Collateral) under, this Agreement, including, without
limitation, reasonable attorneys' fees.
7. CONTINUING LIEN; RETURN OF COLLATERAL
This Agreement shall create a continuing security interest in the
Collateral and shall remain in full force and effect until the payment in full
of all Secured Obligations. So long as no Event of Default has occurred, when
all Secured Obligations have been paid, performed and satisfied in full, this
Agreement shall terminate and the Collateral held by Secured Party shall
promptly be returned to Pledgor, in no event later than five (5) business days
after the date of such notification, at the address of Pledgor set forth in
Section 11 or at such other address as Pledgor may direct in writing. The
Secured Party shall not be deemed to have made any representation or warranty
with respect to any Collateral so delivered, except that such Collateral is free
and clear, on the date of delivery, of any and all liens, charges and
encumbrances arising from its own acts.
8. ADDITIONAL ACTIONS AND DOCUMENTS
Pledgor hereby agrees to take or cause to be taken such further
actions to execute, deliver and file or cause to be executed, delivered and
filed such further documents and instruments, and to obtain such consents as may
be necessary or desirable, in the opinion of Secured Party, in order to fully
effectuate the purposes, terms and conditions of this Agreement, whether before,
at or after the occurrence of an Event of Default.
9. SURVIVAL
It is the express intention and agreement of the parties hereto
that all covenants, agreements, statements, representations, warranties and
indemnities made by Pledgor herein shall survive the execution and delivery of
this Agreement.
10. ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior oral or written agreements, commitments or understandings with respect to
the matters provided for herein.
11. NOTICES
All notices, demands, consents, requests, and other
communications required or permitted to be given or made hereunder shall be in
writing and shall be delivered, telecopied, telexed or mailed by first-class,
registered or certified mail,
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return receipt requested, postage prepaid, or transmitted by hand delivery,
addressed as follows:
If to Pledgor:
iDial Networks, Inc.
0000 Xxxxxxxxxx Xxxxx Xxxxx #000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx X. Xxxx
Facsimile: (000) 000.0000
with a copy (which shall not constitute notice hereunder) to:
Sichenzia Xxxx Xxxxxxxx Xxxxxxx LLP
1065 Avenue of the Xxxxxxxx 00xx Xx.
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxx
Facsimile: 212-930-9725
If to Secured Party:
The Titan Corporation
0000 Xxxxxxx Xxxx Xxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice hereunder) to:
Xxxxx & Xxxxxxx L.L.P.
0000 Xxxxxxxxxx Xxxxx
Xxxxx 0000
XxXxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X.X. Xxxxxx, Esq.
Xxxxxx X. Xxxx, Esq.
Facsimile: (000) 000-0000
Each party may designate by notice in writing a new address to
which any notice, demand, request or communication may thereafter be so given,
served or sent. Each notice, demand, request or communication which shall be
given or made in the manner described above shall be deemed sufficiently given
or made for all purposes at such time as it is hand-delivered to the addressee
(with the delivery receipt or statement of messenger being deemed conclusive,
but not exclusive, evidence of such delivery) or at such time as delivery is
refused by the addressee upon presentation or three (3) days after being
deposited in the mails, as applicable.
12. AMENDMENT
No amendment, modification or supplement of or to this Agreement
shall be valid or binding unless set forth in writing and duly executed by the
party against whom enforcement of the amendment, modification or supplement is
sought.
13. BENEFIT AND ASSIGNMENT
This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement may not be assigned by Pledgor.
14. WAIVER
No delay or failure on the part of Secured Party in exercising
any right, power or privilege under this Agreement or under any other
instruments given in connection with or pursuant to this Agreement shall impair
any such right, power or privilege or be construed as a waiver of any default or
any acquiescence therein. No single or partial exercise of any such right, power
or privilege shall preclude the further exercise of such right, power or
privilege, or the exercise of any other right, power or privilege. No waiver
shall be valid against Secured Party unless made in writing and signed by
Secured Party, and then only to the extent expressly specified therein.
15. SEVERABILITY
If any part of any provision of this Agreement or any other
agreement, document or writing given pursuant to or in connection with this
Agreement shall be invalid or unenforceable in any respect, such part shall be
ineffective to the extent of such invalidity or unenforceability only, without
in any way affecting the remaining parts of such provision or the remaining
provisions of this Agreement.
16. GOVERNING LAW; JURISDICTION
This Agreement, the rights and obligations of the parties hereto,
and any claims or disputes relating thereto, shall be governed by and construed
in accordance with the laws of the Commonwealth of Virginia (excluding the
choice of law rules thereof). In any action between any of the parties arising
out of or relating to this Agreement or any of the transactions contemplated by
this Agreement: (a) each of the parties irrevocably and unconditionally consents
and submits to the exclusive jurisdiction and venue of the Circuit Court of
Fairfax County, Virginia and the United States District Court for the Eastern
District of Virginia and the applicable courts for appeals thereform; (b) if any
such action is commenced in a state court, then, subject to applicable law, no
party shall object to the removal of such action to any federal court located in
the Commonwealth of Virginia; (c) each of the parties irrevocably waives the
right to trial by jury; and (d) each of the parties irrevocably consents to
service of process by first class certified mail, return receipt requested,
postage prepaid, to the address at which such party is to receive notice in
accordance with Section 11.
17. PRONOUNS
All pronouns and any variations thereof in this Agreement shall
be deemed to refer to the masculine, feminine, neuter, singular or plural, as
the identity of the person or entity may require.
18. HEADINGS
Section headings contained in this Agreement are inserted for
convenience of reference only, shall not be deemed to be a part of this
Agreement for any purpose, and shall not in any way define or affect the
meaning, construction or scope of any of the provisions hereof.
19. EXECUTION
To facilitate execution, this Agreement may be executed in as
many counterparts as may be required; and it shall not be necessary that the
signatures of, or on behalf of, each party, or that the signatures of all
persons required to bind any party, appear on each counterpart; but it shall be
sufficient that the signature of, or on behalf of, each party, or that the
signatures of the persons required to bind any party, appear on one or more of
the counterparts. All counterparts shall collectively constitute a single
agreement. It shall not be necessary in making proof of this Agreement to
produce or account for more than that number of counterparts containing the
respective signatures of, or on behalf of, all of the parties hereto.
20. ACKNOWLEDGEMENT
The parties hereby acknowledge that this Agreement was executed
in McLean, Virginia.
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IN WITNESS WHEREOF, each of the parties hereto has duly
executed this Pledge Agreement, or has caused this Pledge Agreement to be duly
executed on its behalf, as of the day and year first above written.
PLEDGOR:
IDIAL NETWORKS, INC.
By:
----------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
SECURED PARTY:
THE TITAN CORPORATION
By:
----------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
Schedule A
PLEDGED SHARES
PLEDGOR PLEDGED SHARES
iDial Networks, Inc. 1,000 shares of common stock,
no par value, of GlobalNet, Inc.
