Exhibit 10.6
 
MEMBERSHIP INTEREST PLEDGE AGREEMENT
 
THIS MEMBERSHIP INTEREST PLEDGE AGREEMENT (this "Pledge") is made and entered
into this 28th day of September, 2012, by and between X-FACTOR COMMUNICATIONS
HOLDINGS, INC. ("Pledgor") and NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY
("Pledgee").
 
RECITALS:

A.           This Pledge is made to secure the performance of the Pledgor (as
guarantor) pursuant to a Corporate Guarantee Agreement of even date herewith to
secure the payment of all obligations pursuant to a Secured Convertible
Promissory Note, dated July 31, 2009, as amended made and given by X-FACTOR
COMMUNICATIONS, LLC (the "Borrower") to Pledgee (as lender) and all other
documents (collectively, the “Loan Documents") executed in connection with a
$500,000 loan (“Loan”).

B.           Borrower and Pledgor have consummated a reverse merger transaction
pursuant to which Pledgor acquired all of the issued and outstanding membership
interests of Borrower(the “Transaction”). In connection with the Transaction,
the Pledgee, Borrower and Pledgor have agreed that Pledgor will pledge a first
lien interest in all of Pledgor's membership interests in the Borrower
(“Membership Interests”) to further secure the payment of all obligations under
the Loan Documents.
 
NOW, THEREFORE, for and in consideration of the matters recited above, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, Pledgor agrees as
follows:
 
1.           Security Interest. Pledgor hereby pledges and grants to Pledgee a
security interest in and a lien on the Membership Interests, and all cash,
securities and property paid, and/or distributed to or for the benefit of
Pledgor as a consequence of Pledgor's ownership of the Membership Interests, or
any portion thereof (collectively, the "Collateral"). The parties agree that
financing statements (Forms UCC1) may be filed in Delaware.
 
2.           Obligations Secured. The Collateral and the continuing security
interest granted herein shall secure all amounts payable under the Loan
Documents.
 
3.           Delivery. All original certificates and instruments representing or
evidencing the Collateral, or any portion thereof, shall be delivered to and
held by or on behalf of Pledgee pursuant hereto and shall be in suitable form
for transfer by delivery, or shall be accomplished by duly executed instruments
of transfer or assignments in blank.
 
4.           Covenants. Pledgor covenants and agrees that until the amounts due
and owing under the Loan Documents have been paid in full, Pledgor shall:
 
(a)           Sale of Collateral. Not sell, transfer, assign or otherwise
dispose of the Collateral, or any portion thereof, without the prior written
consent of Pledgee.

 
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(b) Creation of Liens. Not voluntarily create, incur or permit to exist any
mortgage, pledge, encumbrance, lien, security interest or charge of any kind on
the Collateral, or any portion thereof, except as contemplated hereby.
 
(c) Additional Documents and Future Actions. Pledgor will take such actions and
provide Pledgee, from time to time, with such agreements, financing statements
and additional instruments, documents or information as Pledgee may reasonably
deem necessary or advisable to perfect, protect and maintain its security
interests in the Collateral or any portion thereof, to permit Pledgee to protect
its interest in the Collateral or any portion thereof, or to carry out the terms
hereof. Pledgor irrevocably authorizes the filing of carbon, photographic or
other copy of this Agreement, or of a financing statement, as a financing
statement.
 
(d) Requested Information. Upon a Default as defined below, with reasonable
promptness, deliver to Pledgee all such other data and information in respect of
the financial condition and affairs of Pledgor and the value of the Collateral,
as Pledgee may reasonably request from time to time.
 
5.           Default. The occurrence of an Event of Default as defined under any
of the Loan Documents shall constitute a Default hereunder.
 
6.           Rights of Pledgor and Pledgee.
 
(a)           Before a Default. Prior to the occurrence of an Event of Default:

 

(1) Voting.  Pledgor shall be entitled to exercise any and all voting and other
consensual rights arising under the Collateral, or any portion thereof, for any
purpose not inconsistent with the terms hereto.
 
(2)  Distributions.  Pledgor shall be entitled to receive and retain, free and
clear of any security interest in favor of Pledgee, any and all distributions
with respect to the Collateral, or any portion thereof.
 
(b)           After a Default. Upon the occurrence and during the continuance of
an Event of Default:
 
(1)           Voting. Pledgee shall have the right to (i) exercise voting and
other consensual rights which Pledgor would otherwise be entitled to exercise
and (ii) receive distributions which Pledgor would otherwise be authorized to
receive and retain.
 
(2)           Sale of Collateral. Pledgee may exercise in respect of the
Collateral all the rights and remedies of a secured party upon default under the
Uniform Commercial Code of the State of New Jersey.
 
 
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7. Reasonable Care. Pledgee shall exercise reasonable care in the custody and
preservation of the Collateral in its possession.

8. Return of Collateral. Upon the satisfaction by the Pledgor of all its
Obligations under the Corporate Guarantee Agreement and this Agreement, the
security interest given in the Collateral shall be terminated. Within ten (10)
days thereof, the Pledgee shall deliver the Collateral to Pledgor.
 
9. Miscellaneous.
 
(a)                      Communications and Notices. Any notice, demand or
request required or permitted to be made pursuant to, under or by virtue of this
Agreement shall be delivered in accordance with the terms of the Corporate
Guarantee Agreement.
 
(b)           Severability. The provisions of this Pledge are deemed to be
severable, and the
invalidity or unenforceability of any provision shall not affect or impair the
remaining provisions which shall continue in full force and effect.

 
(c) Headings. The headings of the Articles, Sections, paragraphs and clauses of
this Pledge are inserted for convenience only and shall not be deemed to
constitute a part of this Pledge.

(d)           Binding Effect. This Pledge and all rights and powers granted
hereby will bind and inure to the benefit of the parties hereto and their
respective heirs, executors, personal representatives and permitted successors
and assigns, as applicable.
 
(e)           Amendment. No modification of this Pledge shall be binding or
enforceable unless in writing and signed by or on behalf of the party against
whom enforcement is sought.
 
(f) Governing Law. This Pledge has been made, executed and delivered in the
State of New Jersey and shall be construed in accordance with and governed by
the laws of such State.
 
(g) No Third-Party Beneficiaries. The rights and benefits of this Pledge shall
not inure to the benefit of any third party.
 
(h) Counterparts. This Pledge may be executed in any number of counterparts, all
of which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Pledge by signing any such counterpart.

[SIGNATURE PAGE FOLLOWS]

 
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IN WITNFSS WHEREOF, Pledgor has executed this Pledge as of the day and year
first above written.
 

  PLEDGOR:     X-FACTOR COMMUNICATIONS HOLDINGS, INC.          
 
By:
/s/ Charles Saracino     Name: Charles Saracino     Title: President & CEO      
      PLEDGEE;     NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY             By: /s/
Daniel Weick     Name: Daniel Weick     Title: Director-Finance and Bond
Portfolio Management  

 
 
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ACKNOWLEDGMENT
 
STATE OF NEW JERSEY    :
          ss.:
COUNTY OF Bergen    :

BE IT REMEMBERED, that on this 1st day of October, 2012, before me, the
subscriber, personally appeared CHARLES SARACINO, who, being by me duly sworn,
did depose and make proof to my satisfaction that he is the PRESIDENT & CEO of
X-FACTOR COMMUNICATIONS HOLDINGS, INC., the entity mentioned in the within
Instrument; that the execution, as well as the making of this Instrument, has
been duly authorized by a proper resolution of the Board of Directors of said
entity; and said Instrument was signed and delivered by said officer as and for
the voluntary act and deed of said entity.
 
 
 
/s/ John Jung Min Kim       John Jung Min Kim      
Notary Public
State of New Jersey
My Commission Expires Feb. 16, 2017
 

 
 
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ACKNOWLEDGMENT
 
STATE OF NEW JERSEY    :
ss.:
COUNTY OF MERCER   :

BE IT REMEMBERED, that on this 28th day of September, 2012, before me, the
subscriber, personally appeared DANIEL WEICK, who, being by me duly sworn, did
depose and make proof to my satisfaction that she is the DIRECTOR – FINANCE AND
BOND PORTFOLIO MANAGEMENT of the NEW JERSEY ECONOMIC DEVELOPMENT AUTHORITY, the
authority mentioned in the within Instrument; that the execution, as well as the
making of this Instrument, has been duly authorized by a proper resolution of
the Board of Members of said authority; and said Instrument was signed and
delivered by said officer as and for the voluntary act and deed of said
authority.

 
 
/s/ Carol A. Hirth       Carol A. Hirth       State of New Jersey       My
Commission Expires February 27, 2014  

 
 
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