EXHIBIT 10.3
------------
SHAREHOLDERS' AGREEMENT
-----------------------
-11-
SHAREHOLDERS' AGREEMENT
THIS SHAREHOLDERS AGREEMENT (this "Agreement") dated as of February 28, 2002,
---------
is entered into by and among Intercallnet, Inc., a Florida corporation (the
"Company"), Stanford Venture Capital Holdings, Inc., a Delaware corporation (the
--------
"Investor"), and Xxxxx Xxxxxxx, individually, (the "Founder"). The Investor and
-------- -------
the Founder are sometimes referred to herein individually as a "Shareholder" and
-----------
collectively as the "Shareholders."
------------
RECITALS
WHEREAS, concurrent with the execution and delivery of this Agreement (or at the
Closing if later), the Company is issuing and selling to the Investor 1,500,000
shares (the "Preferred Shares") of its Series A Convertible Preferred Stock,
----------------
$0.0001 par value per share (the "Series A Convertible Preferred Stock")
------------------------------------
pursuant to the terms and conditions of that certain Series A Convertible
Preferred Stock and Common Stock Purchase Warrant Purchase Agreement dated of
even date herewith between the Company and such Investor (the "Purchase
--------
Agreement");
---------
WHEREAS, the Preferred Shares are convertible at any time and from time to time
into shares of common stock, $0.0001 par value per share (the "Common Stock"),
------------
of the Company at the option of the holder of record thereof; and
WHEREAS, the Shareholders and the Company have agreed that it is in their mutual
best interest and in the best interest of the Company to provide certain rights,
obligations and restrictions with respect to the Preferred Shares and/or shares
of Common Stock now or hereafter owned by any Shareholder and any other voting
capital stock of the Company or securities convertible into, exchangeable for or
having rights to purchase voting capital stock of the Company (such voting
capital stock, securities, Preferred Shares and Common Stock are hereinafter
referred to collectively as "Stock").
-----
NOW THEREFORE, in consideration of the premises, the mutual covenants and
agreements herein contained, and other valuable consideration, the receipt,
adequacy and sufficiency whereof are hereby acknowledged, the parties hereto,
intending to be legally bound, do hereby covenant and agree as follows:
ARTICLE I
Corporate Governance
--------------------
1.1 Board of Directors. Commencing on the date of execution of the Purchase
------------------
Agreement by and between the Company and the Investor and provided that the
Investor purchases all of the Series A Convertible Preferred Stock pursuant to
the terms and conditions of the Purchase Agreement, and for so long as the
Investor and/or its affiliates own at least ten percent (10%) of the Preferred
Shares, each of the Founder and the Investor and/or its affiliates shall
vote all of their respective capital stock of the Company and shall promptly
take all other necessary or desirable actions within their respective control
(whether in his or its capacity as a shareholder, director or officer of the
Company or otherwise, and including, without limitation, attendance at meetings
in person or by proxy for purposes of obtaining a quorum and execution of
written consents in lieu of meetings), and the Company shall promptly take all
necessary and desirable actions within its control (including, without
limitation, calling special board and stockholder meetings), so that:
(i) the Investor shall have the right in any election of directors
to the Board of Directors to select one (1) representative (the "Investor
Representative") to the Board of Directors;
(ii) the Founder shall continue to serve as a member of the Board of
Directors;
(iii) in the event that any Investor Representative designated
hereunder for any reason ceases to serve as a member of the Board of Directors
or a committee thereof during his or her term of office, the resulting vacancy
on the Board of Directors or committee shall be filled by a representative
designated by the Investor; and
(iv) the Company shall pay the reasonable out-of-pocket expenses
incurred by the Investor Representative in connection with the performance of
his duties as a director, including, without limitation, attendance at meetings.
ARTICLE II
Restrictions on Transfer
------------------------
2.1 Restrictions on Transfer. No Shareholder (including transferees of
------------------------
Shareholders) shall transfer any shares of Stock, or any interest therein,
whether by operation of law or otherwise, except in accordance with all of the
provisions of this Agreement. As used in this Agreement, the term "transfer"
--------
shall include any sale, pledge, gift, exchange, assignment or other disposition
of shares of Stock.
2.2 First Offer. If a Shareholder (the "Selling Shareholder") desires to
----------- -------------------
transfer or receives an offer to sell any or all of such Shareholder's Stock
(the "Offered Stock"), such Shareholder shall first give written notice (a
-------------
"Transfer Notice") thereof to the Company, identifying the proposed transferee,
----------------
the number of shares sought to be transferred, the proposed purchase price (the
"Offered Price"), if applicable, the terms of the proposed transaction including
-------------
the proposed transaction date and a copy of any written offer or other writing
setting
2
forth the terms and conditions of the proposed transaction. Such Transfer Notice
shall constitute an irrevocable offer by the Selling Shareholder to sell all of
the Offered Stock to the Company at the Offered Price and upon the same terms
and conditions as the Selling Shareholder is willing to sell the Offered Stock
to the proposed transferee. To the extent the consideration proposed to be paid
by the proposed transferee consists of property other than cash, the reasonable
cash equivalent of such property, and the manner of determining the same, shall
be stated in such Transfer Notice. Once given, a Transfer Notice may not be
modified or amended except with the written consent of the Company and the
Investor (or its Permitted Transferees (as hereinafter defined)) holding at
least two thirds of the Preferred Shares (including all Conversion Shares (as
hereinafter defined)). Within the twenty (20) day period following the giving of
the Transfer Notice (the "First Offer Period"), the Company may elect, by giving
------------------
written notice of such election to the Selling Shareholder, to purchase all but
not less than all of the Offered Stock.
2.3 Second Offer. If the Company does not elect to purchase all of the Offered
------------
Stock within the First Offer Period, the Company shall then transmit a copy of
the Transfer Notice to the other Shareholder together with a statement that it
has elected not to purchase the Offered Stock, and the Offered Stock shall
thereby be offered by the Selling Shareholder to the other Shareholder (the
"Principal Shareholder") for a period of twenty (20) days from the transmittal
---------------------
of such Transfer Notice to the Principal Shareholder (the "Second Offer
------------
Period"), for the same Offered Price and upon the same terms and conditions as
------
set forth in the Transfer Notice. The Principal Shareholder (and/or his, her or
its assigns) shall be initially entitled to elect to purchase such pro rata
portion of the Offered Stock as the number of shares of Stock (on an as-
converted basis) owned by such Principal Shareholder on the date of the
commencement of the First Offer Period bears to the number of shares of Stock
(on an as-converted basis) owned by all Principal Shareholders on such date.
If the Principal Shareholder does not elect, by notice in writing given to the
Selling Shareholder within the Second Offer Period, to purchase all of the
Offered Stock to which he or it is entitled, or if there is no such Electing
Shareholder, then the Selling Shareholder shall be free to dispose of the
Offered Stock within ninety (90) days of the end of the Second Offer Period (or
if no Second Offer Period is required, then within ninety (90) days of the end
of the First Offer Period) to the original proposed transferee, at a price not
lower than the Offered Price, and upon the terms stipulated in the Transfer
Notice in all material respects. However, as a condition to the effectiveness
of such transfer, said transferee shall thereupon become a party to this
Agreement as a Shareholder and, pursuant to Section 4.15, shall confirm such
fact by executing a counterpart of this Agreement. If such Offered Stock is not
so disposed of by the Selling Shareholder within such ninety (90) day period,
the Selling Shareholder
3
shall continue to hold such Stock subject to all of the terms and conditions of
this Agreement and may not sell the Stock without again complying with all of
the provisions hereof.
2.4 Certain Transfers Not Prohibited. Except as otherwise expressly provided
--------------------------------
herein, the restrictions on dispositions of Stock contained in this Agreement
shall not be construed to prohibit the following transfers of Stock ("Permitted
---------
Transfers"):
---------
(a) transfers of Stock by a Shareholder to or among such Shareholder's
Family Group (as defined below) or by will or the laws of descent and
distribution to such Shareholder's Family Group ("Shareholder's Family
Group" means an individual's spouse and lineal descendants, parents,
grandparents and any family limited partnership or trust or other fiduciary
relationship solely for the benefit of such individual and/or such
individual's spouse, parents, grandparents and/or lineal descendants);
(b) transfers of Stock upon the death of a Shareholder to his executors or
administrators or legal successors, including without limitation
trustee(s);
(c) any transfer by the Investor to an "affiliate" of such Investor (as
such term is defined in Rule 405 under the Securities Act of 1933, as
amended (the "Securities Act")), or any transfer of Stock by the Investor
--------------
pro rata to persons owning beneficial interests in the Investor, or any
transfer of Stock by the Investor pursuant to a registered offering in
accordance with the Registration Rights Agreement, dated as of the date
hereof, between the Company and the Investor; and
(d) any transfer of Stock in accordance with Section 3.2 of this
Agreement.
Any and all shares of Stock in the hands of any transferee pursuant to
subsections (a) - (d) of this Section 2.5 (each a "Permitted Transferee") shall
--------------------
remain subject to this Agreement. Permitted Transferees under subsections (a) -
(d) of this Section 1.5 shall be deemed to be Shareholders for all purposes of
this Agreement as if they had executed and delivered the Agreement.
4
ARTICLE III
Co-Sale Rights
--------------
3.1 Tag Along Rights. (a) In the event that (x) a Shareholder (a
----------------
"Transferring Shareholder") proposes to transfer all of the shares of Stock held
-------------------------
by such Transferring Shareholder (except as otherwise provided below); (y) the
other Shareholder has not exercised any rights pursuant to Article II; and (z)
the Company has not exercised any rights pursuant to Article II, then such
Transferring Shareholder shall deliver a written notice (the "Sale Notice") to
-----------
the Company and to the other Shareholder, specifying in reasonable detail the
identity of the proposed transferee(s) and the terms and conditions of the
transfer. The Shareholder may elect to participate in the contemplated transfer
by delivering written notice to the Transferring Shareholder within twenty (20)
days after receipt by the Shareholder of the Sale Notice. If the other
Shareholder elects to participate in such Transfer, the other Shareholder will
be entitled to sell in the contemplated transfer, at the price per share of
Common Stock offered by the proposed transferee in the transfer, for each share
of Common Stock held by the other Shareholder electing to participate in the
contemplated transfer on a fully-diluted as-converted basis (including, without
limitation, in the case of the Investor, shares of Common Stock into which the
Investor's Preferred Shares then held are convertible, the "Conversion Shares"),
-----------------
and otherwise on the same terms and conditions as the Transferring Shareholder,
its pro rata portion of shares of Common Stock (including Conversion Shares, as
applicable) based on the percentage of shares being sold by the Transferring
Shareholder compared to the total shares held by the Transferring Shareholder on
a fully-diluted, as converted basis.
(b) The Transferring Shareholder shall use his or its best efforts to
obtain the agreement of the prospective transferee(s) to the participation
of the other Shareholder in any contemplated transfer, to the extent the
other Shareholder elects to participate in the manner set forth in (a)
above, and no Transferring Shareholder shall transfer any of such
Transferring Shareholder's shares to the prospective transferee(s) if the
prospective transferee(s) declines to allow such participation of such
other Shareholder.
(c) The right of co-sale set forth herein shall not apply to any transfer
to a Permitted Transferee pursuant to Section 2.5, but any and all shares
of Stock in the hands of any Permitted Transferee pursuant to said
subsection shall remain subject to this Agreement.
3.2 Obligation to Sell. In the event the Company or the Investor receive(s) a
------------------
written bona fide offer from a third party to purchase all of the outstanding
shares of Stock of the Company, regardless of the form of the proposed
transaction, at
5
the written request of the Company or the Investor (the "Selling Party"), as the
-------------
case may be, each Shareholder (including any Permitted Transferee(s) of a
Shareholder) must sell all of its shares of Stock, as the case may be, in the
transaction, provided that such transaction is approved by (x) the holders of at
--------
least fifty percent (50%) of the outstanding shares of Series A Convertible
Preferred Stock and (y) all of the outstanding shares of Common Stock held by
the Founder. The Selling Party shall give to each Shareholder a notice (an
"Obligation to Sell Notice") containing a description of the material terms of
-------------------------
such proposed transaction including the name and address of the proposed
transferee, the consideration per share offered by the proposed transferee, the
payment terms and closing date, which shall be a date not less than sixty (60)
days after the giving of the Obligation to Sell Notice, and including a copy of
any written offer, letter of intent, term sheet or contract of sale. It shall be
a condition of the obligation to sell under this Section 3.2 that all facts and
circumstances and all material aspects of any transaction under this Section 3.2
shall be disclosed.
ARTICLE IV
Miscellaneous
-------------
4.1 Filing of Agreement. A copy of this Agreement, as amended from time to
-------------------
time, shall be filed with and retained by the Secretary of the Company.
4.2 Company Designee. All rights granted to the Company by the terms of this
----------------
Agreement may be exercised by such person, persons, entity or entities as the
Board of Directors of the Company, in its sole discretion, shall designate
acting by vote or unanimous written consent.
4.3 Reservation of Common Stock. The Company shall, at all times, have
---------------------------
reserved the appropriate number of shares of Common Stock for the conversion of
all outstanding Preferred Shares.
4.4 Endorsement of Stock Certificates. All certificates representing Stock
---------------------------------
owned by the Shareholders shall have conspicuously endorsed thereon a legend
substantially as follows:
"TRANSFER RESTRICTED
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS
UPON TRANSFER PURSUANT TO A SHAREHOLDERS AGREEMENT BY AND AMONG THE COMPANY
AND ITS SHAREHOLDERS. A COPY OF THE SHAREHOLDERS AGREEMENT MAY BE OBTAINED
FROM THE
6
COMPANY WITHOUT CHARGE UPON THE WRITTEN REQUEST OF THE HOLDER HEREOF.
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND MAY
NOT BE OFFERED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED UNLESS (1) THEY ARE REGISTERED UNDER THE ACT OR (2) THE HOLDER
HAS DELIVERED TO THE ISSUER AN OPINION OF COUNSEL, SATISFACTORY TO THE
ISSUER AND ITS COUNSEL, TO THE EFFECT THAT THERE IS AN AVAILABLE EXEMPTION
FROM REGISTRATION UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
THAT REGISTRATION IS OTHERWISE NOT REQUIRED.
4.5 Closing. Except as otherwise provided herein, whenever the Company or any
-------
permitted purchaser(s) hereunder, as the case may be, elects to purchase Stock
pursuant to this Agreement, the Company or the Selling Shareholder, whichever is
applicable, shall be given written notice of the election to accept an offer,
specifying therein the date and place for the closing of the sale, which closing
shall occur no later than thirty (30) days following such election. A copy of
all such notices given by permitted purchasers hereunder shall be provided to
the Company simultaneously with the giving of such notices. If either the
Company or one or more permitted purchasers hereunder have elected to purchase
Stock, all closings shall take place simultaneously and the closing date for the
sale shall be the later of the dates chosen by the Company and such accepting
purchaser(s). In the event that the purchase of the Stock is not consummated
through no fault of the selling party on or before the closing date determined
in accordance with the provisions hereof, the right of any party failing to
purchase such Stock hereunder on such occasion shall expire.
4.6 Payment for Stock. Except as otherwise provided hereinafter with respect
-----------------
to certain purchases of Stock by the Company, all payments hereunder shall be
made in cash, by certified cashier's or bank check, or by wire transfer of
immediately available funds. To the extent that the proposed consideration to
be paid by any proposed transferee as described in a Transfer Notice pursuant to
Section 2.2 consists of property other than cash, the purchase price under
Sections 2.2 through 2.3, inclusive, of this Agreement shall be paid in cash in
lieu of the fair market value of such non-cash consideration, or the fair value
thereof if there is no market therefor.
4.7 Delivery of Stock and Documents. Upon the closing of a sale as herein
-------------------------------
provided, the seller shall deliver to each purchaser in exchange for payment of
7
the purchase price: (a) the certificates for the Stock being sold, endorsed for
transfer and bearing any necessary documentary stamps, and (b) such assignments,
certificates of authority, tax releases, consents to transfer, instruments and
evidence of title of the seller, and of his compliance with applicable state and
Federal law, as may be reasonably required by counsel for each such purchaser.
4.8 Entire Agreement. This Agreement represents the complete agreement among
----------------
the parties hereto with respect to the transactions contemplated hereby and
supersedes all prior written or oral agreements and understandings.
4.9 Pronouns. Whenever the context of this Agreement permits, the masculine
--------
gender shall include the feminine and neuter genders, and any reference to the
singular or plural shall be interchangeable with the other.
4.10 Separability. The invalidity or unenforceability of any one or more
------------
provisions of this Agreement shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if any such invalid or
unenforceable provisions were omitted.
4.11 Headings. The headings in this Agreement have been inserted for
--------
convenience of reference only and shall not constitute a part of this Agreement.
4.12 Adjustments. If there shall be any change in the Stock of the Company
-----------
through merger, consolidation, reorganization, recapitalization, stock dividend,
stock split, anti-dilution, addition, combination or exchange of shares, or the
like (any such event being an "Adjustment"), all of the terms and provisions of
----------
this Agreement shall apply to any new, additional or different shares or
securities issued as a result of such Adjustment and the price and number of
securities subject to the provisions hereof shall be adjusted accordingly.
4.13 Notices. All notices, requests, demands, and other communications under
-------
this Agreement shall be in writing and shall be deemed to have been duly given
on the date of service if served personally on the party to whom notice is to be
given, on the date of transmittal of services via telecopy to the party to whom
notice is to be given (provided the sender of such notice is provided with a
printed confirmation of same), or on the third day after mailing if mailed to
the party to whom notice is to be given, by first class mail, registered or
certified, postage prepaid, or via a nationally recognized overnight courier
providing a receipt for delivery and properly addressed as set forth in Schedule
--------
I. Any party may change its address for purposes of this paragraph by giving
-
notice of the new address to each of the other parties in the manner set forth
above.
4.14 Binding Effect. This Agreement shall be binding upon and inure to the
--------------
benefit of the parties hereto and their respective heirs, representatives,
8
successors and assigns. Neither this Agreement nor any of its terms and
conditions, rights and obligations may be assigned by any party hereto except
with the prior written consent of all of the parties hereto, or except as
otherwise expressly permitted herein.
4.15 Parties. Any person who acquires ownership of Stock of the Investor
-------
and/or the Founder (including shares of Stock hereafter issued to the Founder
and/or the Investor) in accordance with the terms of this Agreement shall
automatically become a party to this Agreement, as a Shareholder, and shall
confirm such fact by executing, upon request of any of the parties hereto, a
counterpart of this Agreement.
4.16 Failure to Comply with the Provisions of this Agreement. In addition to
-------------------------------------------------------
any other legal or equitable remedies which it or they may have, the Company and
the Shareholders may enforce their rights under any provision of this Agreement
by actions for specific performance (to the extent permitted by law) and each
party hereto acknowledges and agrees that the parties hereto will be irreparably
damaged in the event that this Agreement is breached. Further, the Company may
refuse to transfer on its books record ownership of Stock which shall have been
sold or transferred in violation of this Agreement or to recognize any
transferee as one of the Company's shareholders for any purpose (including
without limitation, for purposes of dividend and voting rights) until all
applicable provisions of this Agreement have been complied with in full. All
remedies provided by this Agreement are in addition to other remedies provided
by law.
4.17 Waiver, Amendment and Termination. This Agreement may not be amended or
---------------------------------
modified, and no provision hereof may be waived, without the written consent of
the parties hereto. This Agreement shall terminate with respect to all shares
of Stock upon the closing of (a) a sale of all of the capital stock of the
Company, or (b) the consummation of any transaction in accordance with the
provisions of Section 3.2 hereof.
4.18 Counterparts; Telecopier. This Agreement may be executed in multiple
------------------------
counterparts and via telecopier, each of which shall have the force and effect
of an original and all of which together shall constitute but one and the same
document.
4.19 Governing Law; Jurisdiction; Venue; Attorney's Fees. This Agreement is
---------------------------------------------------
executed and delivered in the State of Florida, and this Agreement shall be
governed by and construed in accordance with the laws of the State of Florida
for all purposes and in all respects, without regard to the conflict or choice
of law provisions of such state. Any action and/or proceeding relating to or
arising out of this Agreement shall be brought solely in the federal and/or
state courts located in Miami-Dade County, Florida. The prevailing
party/parties in any such
9
action and/or proceeding shall be entitled to recover its reasonable attorney's
fees and costs from the other party.
4.20 Rule of Construction that Ambiguities to be Construed Against the Drafter
-------------------------------------------------------------------------
of the Document not Applicable. In view of the fact that the parties to this
------------------------------
Agreement have each been represented by their respective counsel in connection
herewith, by their respective execution of this Agreement each of the parties
hereto agrees and acknowledges that the rule of construction that ambiguities
shall be construed against the drafter shall not be applicable to this
Agreement.
IN WITNESS WHEREOF, the Company and the Shareholders have executed this
Shareholders' Agreement as of the day and year first above written.
THE COMPANY:
INTERCALLNET, INC.
By: _____________________________
Xxxxxx Xxxxxxxxx, President
THE INVESTOR:
STANFORD VENTURE CAPITAL HOLDINGS, INC.
By:
Xxxxx X. Xxxxx, President
THE FOUNDER:
_______________________________
Xxxxx Xxxxxxx
Schedule I
----------
Shareholders' Addresses
10
Stanford Venture Capital Holdings, Inc.
000 Xxxxx Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxx X. Xxxxx, President
Xxxxx Xxxxxxx c/o
Intercalllnet, Inc.
0000 XX 0xx Xxx
Xxxx Xxxxxxxxxx, Xxxxxxx 3309
Telecopy: (000) 000-0000
11
