f8k011408ex10iii_bednational.htm


    


    


    


    


    


    EXHIBIT
      B

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    SHARE
      PLEDGE AGREEMENT

    


    


    THIS
      SHARE PLEDGE AGREEMENT (this "Agreement"),
      is dated as of
      January 14, 2008, made by PAUL
      PATRIZIO, an individual residing in the State of New Jersey ("Pledgor")
      for the benefit of DUTCHESS
      PRIVATE EQUITIES FUND, LTD. (“Secured Party”).

     

    WITNESSETH:

    


    WHEREAS,
      pursuant to the promissory note or other financial instruments, including,
      without limitation, (i) that certain Promissory Note dated June 26, 2007 from
      Bedminster National
      Corp. (the “Company”) in favor
      of the
      Secured Party (“Note”),
      the Secured Party has agreed to make certain loans and other financial
      accommodations to the Company

     

    WHEREAS,
      Pledgor is the record and beneficial owner of certain securities or options
      to
      purchase certain securities of the Company listed on Schedule I attached hereto
      and as described herein, and Pledgor has agreed to enter into this Agreement
      in
      order to induce Secured Party to extend and/or continue the extension of credit
      to the Company.

    


    NOW,
      THEREFORE, for and in consideration of any loan, advance or other financial
      accommodation heretofore or hereafter made to or for the benefit of the Company
      or any other obligor under or in connection with the Note, and for other good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, the parties hereto agree as follows:

     

    1. Definitions.  When
      used herein, the following terms have the following meanings (such meanings
      to
      be applicable to both the singular and plural forms of such terms):

     

    Collateral
      - see
Section 2 of
      this Agreement.

     

    Issuer
      - the issuer
      of any of the shares of stock or other securities representing all or any of
      the
      Collateral.

     

    Liens
      - with respect
      to any Person, any interest granted by such Person in any real or personal
      property, asset or other right owned or being purchased or acquired by such
      Person which secures payment or performance of any obligation and shall include
      any mortgage, lien, encumbrance, charge or other security interest of any kind,
      whether arising by contract, as a matter of law, by judicial process or
      otherwise.

     

    Person
      - any
      individual, corporation, limited liability company, partnership, joint venture,
      firm, association, trust or other enterprise or entity or any governmental
      authority.

     

                
      “Secured
      Obligations” All
      indebtedness, liabilities and obligations which are now or may at any time
      hereafter be due, owing or incurred in any manner whatsoever to Secured Party
      by
      the Company or of any subsidiary of the Company, whether under this Agreement,
      any Note, any guaranty or any other documents executed in connection therewith,
      in each case howsoever created, arising or evidenced, whether direct or
      indirect, absolute or contingent, whether at stated maturity, by acceleration
      or
      otherwise (including, without limitation, the payment of interest and other
      amounts which would accrue and become due but for the filing of a petition
      in
      bankruptcy or the operation of the automatic stay under Section 362(a) of the
      Bankruptcy Code, 11 U.S.C. § 362(a)), including, without limitation, all
      charges, fees, expenses, commissions, reimbursements, premiums, indemnities
      and
      other payments related to or in respect of such obligations.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

     

           
       “UCC”
means the
      Uniform Com­mercial Code as in effect in the Commonwealth of
      Massachusetts on the date of this Agreement, as may be amended or modified
      from
      time to time after the date hereof; provided that, "UCC"
      shall also mean
      the Uniform Commercial Code as in effect from time to time in any applicable
      jurisdiction.

     

    2. Pledge.  As
      security for the payment of the Secured Obligations, the Pledgor hereby pledges
      to the Secured Party and grants to the Secured Party, a continuing security
      interest in, all of the following:

     

    A. All
      of the shares of stock, ownership
      interests and other securities described in Schedule I hereto,
      all of the certificates and/or instruments representing such shares of stock,
      ownership interests and other securities, and all cash, securities, dividends,
      rights and other property at any time and from time to time received, receivable
      or otherwise distributed in respect of or in exchange for any or all of such
      shares, ownership interests or other securities; and all additional shares
      of
      stock or ownership interests of any of the Issuers listed in Schedule I hereto at
      any time and from time to time acquired by the Pledgor in any manner, all of
      the
      certificates and/or instruments representing such additional shares or ownership
      interests and all cash, securities, dividends, rights and other property at
      any
      time and from time to time received, receivable or otherwise distributed in
      respect of or in exchange for any or all of such shares or ownership
      interests;

     

    B. All
      other property hereafter delivered
      to the Secured Party, in substitution for or in addition to any of the
      foregoing, all certificates and instruments representing or evidencing such
      property, and all cash, securities, interest, dividends, rights and other
      property at any time and from time to time received, receivable or otherwise
      distributed in respect of or in exchange for any or all thereof;
      and

     

    C. All
      products and proceeds of all of the
      foregoing.

     

    All
      of
      the foregoing are herein collectively called the "Collateral".

    


    Pursuant
      to the terms of the Escrow Agreement, the Pledgor agrees to immediately deliver
      to the Escrow Agent, for the benefit of Secured Party, promptly upon receipt
      and
      in due form for transfer (i.e., endorsed in blank or accompanied by stock or
      bond powers executed in blank), all shares of stock, ownership interests and
      other securities described in Section 2A and Schedule I hereto and
      any Collateral (other than dividends which the Pledgor is entitled to receive
      and retain pursuant to Section 5 hereof)
      which may at any time or from time to time come into the possession or control
      of the Pledgor; and prior to the delivery thereof to the Escrow Agent, such
      Collateral shall be held by the Pledgor separate and apart from its other
      property and in express trust for the Secured Party.

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    3. Warranties;
      Further
      Assurances.  The Pledgor warrants to the Secured Party
      that:  (a) the Pledgor is (or at the time of any future delivery,
      pledge, assignment or transfer thereof will be) the legal and equitable owner
      of
      the Collateral free and clear of all Liens of every description whatsoever;
      (b)
      the pledge and delivery of the Collateral, pursuant to the terms of the Escrow
      Agreement, will create a valid perfected security interest in the Collateral
      in
      favor of the Secured Party; (c) all shares of stock or ownership interests
      referred to in Schedule I hereto are
      duly authorized, validly issued, fully paid and non-assessable; (d) as to each
      Issuer whose name appears in Schedule I hereto,
      the Collateral represents on the date hereof not less than the applicable
      percentage (as shown in Schedule I hereto)
      of
      the total shares of capital stock or ownership interests issued and outstanding
      of such Issuer; and (e) the information contained in Schedule I hereto is
      true and accurate in all respects.

     

    So
      long
      as any of the Secured Obligations shall be outstanding or any commitment shall
      exist on the part of the Secured Party with respect to the creation of any
      Secured Obligations, the Pledgor: (i) shall not, without the express prior
      written consent of the Secured Party, sell, assign, exchange, pledge or
      otherwise transfer, encumber, or grant any option, warrant or other right to
      purchase the stock of any Issuer which is pledged hereunder; (ii) shall deliver
      to the Escrow Agent pursuant to the terms of the Escrow Agreement, all original
      stock certificates relating to the Collateral, the stock powers with a signature
      guarantee, and a transfer letter to the transfer agent, attached hereto as
      Exhibit A, authorizing transfer of the Shares and stock powers to Dutchess
      in
      the Event of Default; (iii) will permit the Secured Party or any designee of
      the
      Secured Party, from time to time at reasonable times and on reasonable notice
      (or at any time without notice during the existence of an Event of Default),
      to
      inspect, audit and make copies of and extracts from all records and all other
      papers in the possession of the Escrow Agent which evidence the ownership of
      the
      Collateral, and will permit the Escrow Agent, upon request of the Secured Party
      at any time when an Event of Default has occurred and is continuing, to deliver
      to the Secured Party copies of all of such records and papers.

     

    4.  Holding
      in Name of Secured
      Party, etc.  The Secured Party may from time to time after the
      occurrence and during the continuance of an Event of Default (as hereinafter
      defined), without notice to the Pledgor, take all or any of the following
      actions:  (a) transfer, in accordance with all applicable securities
      laws and the UCC, as applicable, all or any part of the Collateral into the
      name
      of the Secured Party or any nominee or sub-agent for the Secured Party, with
      or
      without disclosing that such Collateral is subject to the Lien hereunder, (b)
      appoint one or more sub-agents or nominees for the purpose of retaining physical
      possession of the Collateral, (c) notify the parties obligated on any of the
      Collateral to make payment to the Secured Party of any amounts due or to become
      due thereunder, (d) endorse any checks, drafts or other writings in the name
      of
      the Pledgor to allow collection of the Collateral, (e) enforce any and all
      rights and privileges of the Pledgor against any party with respect to the
      Collateral by suit or otherwise, and surrender, release or exchange all or
      any
      part thereof, or compromise or renew for any period (whether or not longer
      than
      the original period) any obligations of any nature of any party with respect
      thereto, and (f) take control of any proceeds of the Collateral.

     

    5.  Voting
      Rights, Dividends,
      etc.  (a) Notwithstanding certain provisions of Section 4 hereof,
      so
      long as the Secured Party has not given the written notice referred to in paragraph (b)
      below:

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (i)           
      The Pledgor shall be entitled to exercise any and all voting or consensual
      rights and powers and stock purchase, stockholder or subscription rights
      relating or pertaining to the Collateral or any part thereof for any purpose;
      provided that the Pledgor agrees that it will not exercise any such right or
      power in any manner which would have an adverse effect on the
      Collateral.

     

    (ii)           
      The Pledgor shall be entitled to receive and retain any and all lawful dividends
      payable in respect of the Collateral which are paid in cash, but all dividends
      and distributions in respect of the Collateral or any part thereof made in
      shares of stock or other ownership interests, whether resulting from a
      subdivision, combination or reclassification of Collateral or any part thereof
      or received in exchange for Collateral or any part thereof or as a result of
      any
      merger, consolidation, acquisition or other exchange of assets to which any
      Issuer may be a party or otherwise or as a result of any exercise of any stock
      purchase or subscription right, shall be and become part of the Collateral
      hereunder and, if received by the Pledgor, shall be forthwith delivered to
      the
      Secured Party in due form for transfer (i.e., endorsed in blank or accompanied
      by stock or bond powers executed in blank) to be held for the purposes of this
      Agreement.

     

    (iii)           
      The Secured Party shall promptly upon request from the Pledgor execute and
      deliver, or cause to be executed and delivered, to the Pledgor all such proxies,
      powers of attorney, dividend orders and other instruments as the Pledgor may
      request for the purpose of enabling the Pledgor to exercise the rights and
      powers which it is entitled to exercise pursuant to clause (i) above and
      to receive the dividends which it is authorized to retain pursuant to clause (ii)
      above.

     

    (b)           
      Upon written notice from the Secured Party during the existence of an Event
      of
      Default, and so long as the same shall be continuing, all rights and powers
      which the Pledgor is entitled to exercise pursuant to Section 5(a)(i)
      hereof, and all rights of the Pledgor to receive and retain dividends pursuant
      to Section
      5(a)(ii) hereof, shall forthwith cease until such Event of Default has
      been cured or waived in writing, and all such rights and powers shall thereupon
      become vested in the Secured Party which shall have, during the continuance
      of
      such Event of Default, the sole and exclusive authority to exercise such rights
      and powers and to receive such dividends.  Any and all money and other
      property paid over to or received by the Pledgor pursuant to this paragraph (b) shall
      be retained by the Secured Party, as additional Collateral hereunder and applied
      in accordance with the provisions hereof.

     

    6.  Event
      of Default;
      Remedies.

     

    (a)           
      Any one or more of the following events (regardless of the reason therefor)
      shall constitute an "Event of Default" hereunder:

     

    (i)           
      Any default or event of default shall occur under any of the Note or any of
      the
      Transaction Documents associated with the Note, including the
      Amendment.

    


    (ii)           
      Pledgor shall fail or neglect to perform, keep or observe any provision of
      this
      Agreement and the same shall remain unremedied for a period of two (2) days
      after notice is given to Pledgor by the Secured Party.

     

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    
 

    (iii)           
      The Secured Party shall fail to have an enforceable first priority lien on
      and
      security interest in the Collateral.

    


    (iv)           
      Pledgor files a bankruptcy petition, a bankruptcy petition is filed against
      Pledgor which remains undismissed or unstayed for 30 consecutive
      days.

    


     

    (b)           
      Whenever an Event of Default shall exist and be continuing, the Secured Party
      may exercise from time to time any rights and remedies available to it under
      the
      UCC or otherwise available to it by applicable law. Without limiting the
      foregoing, whenever an Event of Default shall exist and be continuing, the
      Secured Party (a) may, to the fullest extent permitted by applicable law,
      without notice, advertisement, hearing or process of law of any kind, subject
      to
      applicable securities laws and the UCC, as applicable, (i) sell any or all
      of
      the Collateral, free of all rights and claims of the Pledgor therein and
      thereto, at any public or private sale or brokers' board and (ii) bid for and
      purchase any or all of the Collateral at any such public sale and (b) shall
      have
      the right, for and in the name, place and stead of the Pledgor, to execute
      endorsements, assignments, stock powers and other instruments of conveyance
      or
      transfer with respect to all or any of the Collateral. Any notification of
      intended disposition of any of the Collateral shall be deemed reasonably and
      properly given if given at least ten (10) days before such disposition. Any
      proceeds of any of the Collateral shall be applied by the Secured Party to
      the
      payment of expenses in connection with the Collateral, including, without
      limitation, reasonable attorneys' fees and legal expenses, and any balance
      of
      such proceeds shall be applied by the Secured Party toward the payment of such
      of the Secured Obligations (and, after payment in full of all Secured
      Obligations, any excess shall be delivered to the Pledgor or as a court of
      competent jurisdiction shall direct).

     

    The
      Secured Party is hereby authorized
      to comply with any limitation or restriction in connection with any sale of
      Collateral as it may be advised by counsel is necessary in order to (a) avoid
      any violation of applicable law (including, without limitation, compliance
      with
      such procedures as may restrict the number of prospective bidders or purchasers
      and/or further restrict such prospective bidders or purchasers to persons or
      entities 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
      such
      Collateral) or (b) obtain any required approval of the sale or of the purchase
      by any governmental regulatory authority or official, and the Pledgor agrees
      that such compliance shall not result in such sale being considered or deemed
      not to have been made in a commercially reasonable manner and that the Secured
      Party shall not be liable or accountable to the Pledgor for any discount allowed
      by reason of the fact that such Collateral is sold in compliance with any such
      limitation or restriction.

     

    7. Notice.
      Any notices,
      consents, waivers or other communications required or permitted to be given
      under the terms of this Agreement must be in writing and will be deemed to
      have
      been delivered (i) upon delivery, when delivered personally; (ii) upon receipt,
      when sent by facsimile or email (provided a confirmation of transmission is
      mechanically or electronically generated and kept on file by the sending party);
      or (iii) one (1) day after deposit with a nationally recognized overnight
      delivery service, so long as it is properly addressed.  The addresses
      and facsimile numbers for such communications shall be:

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    If
      to
      Pledgor:

    


    Attn:
Paul
      Patrizio

    Bedminster
      National
      Corp.

    90
      Washington Valley
      Road

    Bedminster NJ 07921

    Telephone:
908-234-0300

    Facsimile:
      908-234-0608

    Email:  paul@apogeepartners.com

    


    If
      to the
      Company:

    


    Attn:
Paul
      Patrizio

    Bedminster
      National
      Corp.

    90
      Washington Valley
      Road

    Bedminster NJ 07921

    Telephone:
908-234-0300

    Facsimile:
      908-234-0608

    Email:  paul@apogeepartners.com

    


    With
      a copy to:

    


    Anslow
&
Jaclin,
      LLP

    Attn:
      Gregg E. Jaclin,
      Esq.

    195
      Route 9, Suite204

    Manalapan,
NJ 07726

    Telephone:
      732-409-1212

    Facsimile:
      (732)577-1188

    Email:  gjaclin@anslowlaw.com

    


    Robert
      D.
      Frawley, Esq.

    Law
      Offices of Robert D. Frawley

    64
      Maple
      Avenue

    Morristown,
      NJ 07960

    Telephone:  973-451-1100

    Facsimile:  973-451-1115

    Email:  rdf@law-corp.com

    


    If
      to the
      Secured Party:

    


    Dutchess
      Capital Management, LLC

    Douglas
      Leighton

    50
      Commonwealth Ave, Suite 2

    Boston,
      MA 02116

    Telephone:
      (617) 301-4700

    Facsimile:
      (617) 249-0947

    Email:  tsmith@dpef.com

    


     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

     

    8. General.  The
      Secured Party shall be deemed to have exercised reasonable care in the custody
      and preservation of the Collateral if it takes such action for that purpose
      as
      the Pledgor shall request in writing, but failure of the Secured Party to comply
      with any such request shall not of itself be deemed a failure to exercise
      reasonable care, and no failure of the Secured Party to preserve or protect
      any
      rights with respect to the Collateral against prior parties, or to do any act
      with respect to preservation of the Collateral not so requested by the Pledgor,
      shall be deemed a failure to exercise reasonable care in the custody or
      preservation of any Collateral.

     

    No
      delay
      on the part of the Secured Party in exercising any right, power or remedy shall
      operate as a waiver thereof, and no single or partial exercise of any such
      right, power or remedy shall preclude any other or further exercise thereof,
      or
      the exercise of any other right, power or remedy.  No amendment,
      modification or waiver of, or consent with respect to, any provision of this
      Agreement shall be binding against the Secured Party unless the same shall
      be in
      writing and signed and delivered by the Secured Party and the Pledgor, and
      then
      such amendment, modification, waiver or consent shall be effective as against
      the Secured Party or the Pledgor, as the case may be, only in the specific
      instance and for the specific purpose for which given.

     

    All
      obligations of the Pledgor and all rights, powers and remedies of the Secured
      Party expressed herein are in addition to all other rights, powers and remedies
      possessed by them, including, without limitation, those provided by applicable
      law or in any other written instrument or agreement relating to any of the
      Secured Obligations or any security therefor.  When all of the Secured
      Obligations have been paid in full and all of the conditional obligations,
      if
      any, of the Pledgor shall have expired or been sooner terminated, this Agreement
      shall terminate and the security interest granted herein shall be automatically
      released without any further action on the part of any Person. Upon termination
      of this Agreement or any release of Collateral, Secured Party shall, upon the
      request and at the sole cost and expense of the Pledgor, forthwith assign,
      transfer and deliver to Pledgor, against receipt and without recourse to or
      warranty by Secured Party, such of the Collateral to be released as may be
      in
      the possession of Secured Party and as shall not have been sold or otherwise
      applied pursuant to the terms hereof, and, with respect to any other Collateral,
      proper documents and instruments (including, without limitation, UCC-3
      termination statements) acknowledging the termination of this Agreement or
      the
      release of such Collateral, as the case may be.

     

    This
      Agreement and all related instruments and documents and the rights and
      obligations of the parties hereunder and thereunder shall, in all respects,
      be
      governed by, and construed in accordance with, the internal laws of the
      Commonwealth of Massachusetts, without regard to conflicts of law principles,
      regardless of the location of the Collateral, excepting, however, that the
      UCC
      (or decisional law) of a jurisdiction other than Massachusetts may provide
      the
      method of perfection, the effect of perfection or non-perfection, or the
      priority of liens and security interests created under this
      Agreement.  Wherever possible each provision of this Agreement shall
      be interpreted in such manner as to be effective and valid under applicable
      law,
      but if any provision of this Agreement shall be prohibited by or invalid under
      such law, such provision shall be ineffective to the extent of such prohibition
      or invalidity, without invalidating the remainder of such provision or the
      remaining provisions of this Agreement.

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

     

    This
      Agreement shall be binding upon the Pledgor and the Secured Party and their
      respective successors and assigns, and shall inure to the benefit of the
      Pledgor, the Secured Party and its respective successors and
      assigns.

     

    This
      Agreement may be executed in any number of counterparts and by the different
      parties hereto on separate counterparts, and each such counterpart shall be
      deemed an original but all such counterparts shall together constitute but
      one
      and the same Agreement.

     

    The
      parties to this Agreement will submit all disputes arising under it to
      arbitration in Boston, Massachusetts before a single arbitrator of the American
      Arbitration Association (“AAA”).  The arbitrator shall be selected by
      application of the rules of the AAA, or by mutual agreement of the parties,
      except that such arbitrator shall be an attorney admitted to practice law in
      the
      Commonwealth of Massachusetts.  No party to this agreement will
      challenge the jurisdiction or venue provisions as provided in this
      section.  Nothing in
      this section shall limit the Secured Party’s
      right to obtain an injunction for a
      breach of this Agreement from a court of law. Any injunction obtained
      shall remain in full force and effect until the arbitrator, as set forth in
      this
      section fully adjudicates the dispute.

     

    This
      agreement between the Pledgor and the Holder with respect to the terms and
      conditions set forth herein, and, the terms of this Agreement may not be
      contradicted by evidence of prior, contemporaneous, or subsequent oral
      agreements of the Parties.

     

    


     

    [Remainder
      of this page intentionally blank]

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, this Agreement has been duly executed and delivered as of
      the
      day and year first written above.

     

    


    


    ________________________________

    PAUL
      PATRIZIO, as Pledgor

    


    


    DUTCHESS
      PRIVATE EQUITIES FUND,
      LTD,

     as
      Secured Party

    


    


    


    Name:  Douglas
      Leighton

    Title:  Director

    


    


    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    


    SCHEDULE
      I

    TO
      PLEDGE AGREEMENT

    


    
    

    
      	
               Issuer

            	
              Class
                of Stock

            	
              Certificate 

              No(s).

            	 

              Number
                of

              Shares

            	 

              Percentage

              Ownership

            
	
                

                Bedminster
                National
                Class A

               

            	 Common	 	
              5
                million

            	
              ~55.5%

            
	 	 	 	 	 
	 	 	 	 	 
	
                

                Bedminster
                National
                Class B

               

            	 Common	 	
               2.0
                million

            	
              ~92.9%

            
	 	 	 	 	 


    

     

     

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    
 

    


    EXHIBIT
      A

    


    


    


    


    


    


    


    


    January
      14, 2008

    


    


    Continental
      Stock Transfer

    17
      Battery Place

    New
      York,
      NY 10004

    


    Re:           
      Bedminster National Corp.

    


    To
      whom
      it may concern:

    


    I
      hereby
      authorize Continental Stock Transfer to transfer the following certificates
      of
      Bedminster National Corp. stock to Dutchess Private Equities Fund,
      Ltd.:

    


    
      	
              ·  

            	
              5
                million shares of Class A Common Stock;
                and

            


    

    


    
      	
              ·  

            	
              2.0
                million shares of Class B Common
                Stock

            


    

    


    


    Sincerely
      yours,

    


    


    


    Paul
      Patrizio

    Chief
      Executive Officer

    Bedminster
      National Corp.

    
11