OPTION PURCHASE AND ASSIGNMENT AGREEMENT
This Option Purchase and Assignment Agreement is entered into
between the undersigned purchaser (the "Purchaser"), U.S. Wireless Data, Inc.
(the "Company") effective as of __________________, 1998, and Ireland Xxxxxxxxx
Xxxxx & Xxxxxx, P.C., (the "Escrow Agent") to evidence the purchase by Purchaser
and the sale and assignment by the Company of the Company's option to purchase a
total of _________________ shares of the Company's no par value Common Stock
(the "Option Shares") from Tillicombe International LDC, a Cayman Island company
("Tillicombe") to Purchaser pursuant to the terms of this Agreement.
WHEREAS, the Company owns an option, which is initially
exercisable to purchase an aggregate of 367,684 shares of the Company's Common
Stock from Tillicombe (the "Tillicombe Shares") at $.25 per Tillicombe Share
until midnight on September 30, 1998 (the "Option");
WHEREAS, Purchaser desires to acquire such portion of the
Option for the number of Option Shares described in the first paragraph above,
for the price and under the terms and conditions stated herein (the "Assigned
Option");
WHEREAS, Tillicombe has deposited the Tillicombe Shares into
an escrow account with Ireland Xxxxxxxxx Xxxxx & Xxxxxx, P.C. in Denver,
Colorado (the "Escrow Agent") and Tillicombe has authorized the Escrow Agent to
act on its behalf in connection with the transfer of the Option Shares to
persons such as Purchaser upon exercise of Assigned Options (a fully executed
copy of the Assignment Agreement (with Escrow Provisions) (the "Tillicombe
Escrow Agreement") by which Escrow Agent has so agreed to act has been provided
to Purchaser);
WHEREAS, Ireland Xxxxxxxxx Xxxxx & Xxxxxx, P.C., has agreed to
act as escrow agent for the transactions described herein; and
WHEREAS, Purchaser is an accredited investor as defined under
Regulation D of the Rules and Regulations promulgated by the United States
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended (the "1933 Act") and has such knowledge and sophistication in business
and financial matters that it is fully capable of evaluating the merits and
risks associated with an investment in the Option and the Option Shares;
NOW, THEREFORE, for good and valuable consideration, the
receipt and adequacy of which is acknowledged by the parties hereto, the parties
agree as follows:
1. Purchase and Sale of Option. Purchaser hereby purchases and the Company
hereby sells, assigns and transfers unto Purchaser all of the Company's right,
title and interest in and to, the Assigned Option, in return for the
consideration to be paid in accordance with the terms hereof to the Company as
described in Exhibit 1 hereto.
2. Payment of Consideration to Company. Upon execution of this Agreement by
Purchaser, Purchaser shall immediately initiate a wire transfer to the Escrow
Agent, for the benefit of the Company, in immediately available funds in the
amount (in U.S Dollars) set forth on Exhibit 1 hereto (the "Option Assignment
Price").
3. Assignment of Option to Purchaser. Upon receipt by the Company of both an
executed copy of this Agreement from the Purchaser and the Option Assignment
Price, the Company shall immediately evidence assignment of the Assigned Option
by executing an Option Assignment for the Assigned Option, in the form attached
hereto as Exhibit 2. The Company shall contemporaneously notify the Escrow Agent
of the assignment of the Assigned Option to Purchaser by transmitting a copy of
the Option Assignment to the Escrow Agent by facsimile, with a concurrent,
confirming copy to Purchaser (the "Assignment Notice").
4. Exercise Rights of Purchaser; Expiration Date of Option. Once payment of
the Option Assignment Price has been paid to the Company (by deposit of
immediately available funds with the Escrow Agent), Purchaser shall be free to
exercise the Assigned Option by transmitting an exercise notice in the form
attached hereto as Exhibit 3 hereto to the Escrow Agent and concurrently
transmitting by wire transfer of immediately available funds the option exercise
price of U.S. $0.25 per share for each share being purchased by Purchaser
pursuant to exercise of the Assigned Option (the "Option Exercise Price"). The
Option Exercise Price may be concurrently wired to the Escrow Agent by
Purchaser. Purchaser understands and agrees that the Option can be exercised in
minimum amounts of fifty thousand (50,000) shares only, unless and until,
following previous assignments made by the Company, there remain less than
50,000 shares subject to the Option, in which case the Company may assign the
remaining Option, which may then be exercised by an investor even though less
than for 50,000 shares. Upon exercise of the Assigned Option by Purchaser, all
rights in the Assigned Option shall be forever extinguished and Purchaser shall
thereby acquire only the right to receive the Option Shares as stated in
paragraph 5, below. THE ASSIGNED OPTION EXPIRES EFFECTIVE AS OF MIDNIGHT (UNITED
STATES MOUNTAIN TIME) ON OCTOBER 5, 1998, AND MUST BE EXERCISED BY PURCHASER
(INCLUDING DELIVERY OF THE OPTION EXERCISE PRICE TO THE ESCROW AGENT) PRIOR TO
SUCH TIME. IF NOT EXERCISED BY SUCH TIME, ALL RIGHTS UNDER THE ASSIGNED OPTION
SHALL AUTOMATICALLY REVERT TO THE COMPANY, AND ALL AMOUNTS PAID BY PURCHASER FOR
THE ASSIGNED OPTION SHALL BE FORFEITED BY THE PURCHASER.
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5. Delivery of Shares to Purchaser. The Escrow Agent shall within one business
day after receipt of the Option Exercise Price, institute payment of the Option
Exercise Price to Tillicombe by wire transfer of immediately available funds.
Thereafter, upon confirmation that the Option Exercise Price has been received
by Tillicombe or its designated agent, the Escrow Agent shall, within one
business day of receiving such confirmation, deliver any documentation needed by
the transfer agent for the Company's Common Stock, American Securities Transfer
& Trust, Inc. ("AST"), located in Denver, Colorado, to allow AST to transfer the
Option Shares to Purchaser.
6. Character of Shares Deliverable to Purchaser upon Exercise of the Option.
The Option Shares shall be free of any "restricted securities" legend upon
issuance to Purchaser, and provided Purchaser is not an "affiliate" of the
Company (as such term is defined under United States securities laws), the
Option Shares may be immediately resold without restriction of any sort in the
public market.
7. Duties and Obligations of the Company and the Escrow Agent; recordkeeping.
The Option Assignment (a copy of which shall be delivered to the Escrow Agent as
described in paragraph 3, above) shall be the only document delivered to the
Purchaser by the Company to evidence the rights of Purchaser in an Assigned
Option. As such, the Assigned Option shall be deemed an "uncertificated
security" and the Company (based upon information supplied to it by the Escrow
Agent and AST) shall maintain appropriate records as to all ownership rights in
and to, and exercises of, Assigned Options. All purchases and exercises of
Assigned Options and authorizations for delivery of Option Shares shall be
effected exclusively through the Escrow Agent.
8. Acknowledgement of Relationship between the Company and the Escrow Agent.
Purchaser acknowledges and understands that the Escrow Agent acts as counsel to
the Company and that as such, possible conflicts of interest could arise as a
result of such relationship. To the extent that any actual conflict of interest
arises, Purchaser and the Company understand that the Escrow Agent could be
required to resign as Escrow Agent and/or as counsel to the Company, which could
delay any transactions pending at the time. Should such a situation arise, the
Escrow Agent may take any appropriate action, including interpleading any funds
or property in its possession, according to the provisions of Section 5 of the
Tillicombe Escrow Agreement. Purchaser further understands and agrees that the
purchase of the Assigned Option by Purchaser from the Company is a separate and
independent transaction from exercise of the Assigned Option.
9. Additional Provisions Applicable to the Escrow Agent. The provisions of
Section 5 of the Tillicombe Escrow Agreement shall be applicable to the parties
hereto and the Escrow Agent. Such provisions are incorporated by reference
herein the same as if fully set forth.
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10. Company's Representations and Warranties. The Company represents and
warrants to the Purchaser as follows:
a. The Company is the owner of the Option, free and clear of all liens
and encumbrances.
b. The Company has full power and authority to enter into this
Agreement and the transactions contemplated hereby.
c. The Company will use its best efforts to assist the Purchaser in
obtaining the issuance of certificates representing the Option Shares
issuable upon exercise of the Assigned Option within one business day of
the date of the delivery of the Option Exercise Price to Tillicombe, as
described in Paragraph 5, above.
10. Purchaser's Representations and Warranties. Purchaser represents,
warrants and covenants to the Company that:
a. Purchaser is sophisticated in business and financial matters and by
reason of Purchaser's knowledge and experience in such matters, Purchaser
has the capacity to evaluate the merits and risks of the prospective
investment in the Option and the Option Shares.
b. Purchaser is an "accredited" investor within the meaning of Rule
501(a) of Regulation D promulgated under the Securities Act of 1933, as
amended (the "1933 Act").
c. To the extent Purchaser deemed necessary, Purchaser has consulted
with Purchaser's attorney and/or Purchaser's accountant or other advisors
regarding all aspects of the proposed investment. Purchaser understands
that an investment in the Company's securities involves high risks,
including the risk of loss of the entire investment.
d. Purchaser has adequate means of providing for Purchaser's current
needs and possible financial contingencies, and has no need, and
anticipates no need in the foreseeable future, to sell the Option.
Purchaser is able to bear the economic risks of this investment and,
consequently, without limiting the generality of the foregoing, is able to
hold the Option for an indefinite period of time and has a sufficient net
worth to sustain a loss of the entire investment in the Company in the
event such loss should occur.
e. Purchaser is the sole party in interest as to the Option being
acquired by the Purchaser and is acquiring the Option for Purchaser's own
account, for investment only and not with a view toward the resale or
distribution of the Option.
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f. Purchaser understands that the Option is not registered under the
1933 Act and is a "restricted security" as defined under Rule 144
promulgated under the 0000 Xxx. The Option may not be resold unless
registered under the 1933 Act or an exemption from such registration is
available. Purchaser agrees that Purchaser will not attempt to dispose of
the Option except in compliance with the 1933 Act.
g. Purchaser understands that the Company does not intend to issue a
certificate evidencing the Assigned Option, but that the Assigned Option,
even though in uncertificated form, is subject to the following
restrictions:
THE ASSIGNED OPTION HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY STATE OR
FOREIGN LAW. THIS OPTION MAY NOT BE SOLD, TRANSFERRED, PLEDGED
OR HYPOTHECATED UNLESS (i) THEY SHALL HAVE BEEN REGISTERED
UNDER THE ACT AND ANY APPLICABLE STATE AND FOREIGN SECURITIES
ACT OR OTHER LAW OR (ii) AN EXEMPTION FROM SUCH REGISTRATION
IS AVAILABLE AND THE CORPORATION SHALL HAVE BEEN FURNISHED
WITH AN OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION,
THAT REGISTRATION OR OTHER COMPLIANCE IS NOT REQUIRED UNDER
ANY OF SUCH ACTS OR LAWS.
Should any certificate be issued to evidence the Assigned Option, it will be
imprinted with a legend in substantially the foregoing form.
h. Purchaser understands and agrees that there is no market for the
Option and that the Company acts as its own transfer agent and will
prohibit any transfer of the Option except in strict compliance with the
provisions of this Agreement.
i. Purchaser understands and agrees that the Assigned Option does not
have any "registration" or other rights entitling Purchaser to have the
Assigned Option registered under the 1933 Act and that the Assigned Option
is an illiquid security which cannot be sold, assigned or otherwise
negotiated by Purchaser.
j. Purchaser has had the opportunity to examine copies of all reports
filed by the Company pursuant to the Securities Exchange Act of 1934 (the
"1934 Act") and has examined all such 1934 Act reports to the extent
desired. Purchaser has also had the opportunity to ask questions of, and
receive answers from, qualified representatives of the Company concerning
the business and financial condition of the Company and this transaction
and all such questions have been answered to Purchaser's satisfaction.
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k. Purchaser understands that the Company is relying upon the accuracy
of the representations and warranties of Purchaser contained herein in
agreeing to the sale and assignment of the Option to Purchaser.
l. Purchaser is not and has not ever been an officer, director or
holder of greater than 5% of the outstanding shares of the Company,
directly or indirectly, not does Purchaser have the direct or indirect
ability to control the Company through voting of securities, contract or
any other method, nor is investor controlled by or under common control
with, the Company, directly or indirectly. Purchaser agrees that he, she or
it shall immediately inform the Company of any change in this status at any
time prior to exercise of an option or at any time when Purchaser owns any
securities of the Company and shall thereafter refrain from disposing of
any of the Company's securities until advised that Purchaser may do so in
writing by the Company.
m. Purchaser understands and agrees that the Option is the property of
the Company and the Option Shares are the property of Tillicombe, and
payment of the Option Assignment Price to the Company is due in full at the
time of purchase of the Assigned Option from the Company and payment to
Tillicombe is due in full at the time of the exercise of the Assigned
Option. The payment obligations to the Company and Tillicombe hereunder are
not contingent in any way upon any sale of the Option Shares by Purchaser
nor does Purchaser have any agreements, either oral or in writing with the
Company to such effect.
11. Notices. Any notices permitted or required to be given under the terms of
this Agreement shall be in writing and may be served by certified mail, postage
prepaid, return receipt requested, and addressed to the person or entity to be
notified at the appropriate address specified below, or by delivering or causing
to be delivered any such notice to the person or entity, or by facsimile
transmission, addressed to the person or entity to be noticed at said address,
provided a copy is placed in the certified mail, postage prepaid, return receipt
requested, on the same date as sent by facsimile. Any notice given in any
authorized manner shall be effective when actually received, or, if such notice
was sent only by certified mail, on the fifth day after it was deposited into
the custody of the United States Postal Service, whether actually received by
the addressee or not. Addresses may be changed by notice given in the manner
provided in this paragraph 11.
The address of the Purchaser and the Company are set forth on the signature page
hereto.
The address of the Escrow Agent is as set forth on Exhibit 3.
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12. Miscellaneous.
a. This Agreement contains the entire agreement between the Purchaser
and the Company regarding the purchase and transfer of the Option.
Purchaser understands that no person has been authorized to represent
anything to the Purchaser which in any way contradicts what is set forth in
this Agreement and any such representation cannot be relied upon as having
been authorized by the Company.
b. The provisions of this Agreement may not be modified or waived
except in writing signed by the party to be bound by any such modification
or waiver.
c. The provisions of this agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assignees.
d. The caption headings of the Sections of this Agreement are for
convenience only and shall not be considered a part of this Agreement.
e. Time is of the essence with respect to all performance under this
Agreement.
f. This Agreement is not assignable by the Purchaser absent the
written consent of the Company. This Agreement shall be binding on, inure
to the benefit of, and be enforceable by and against the parties and their
respective heirs, executors, administrators, successors, permitted assigns
and legal representatives.
g. This Agreement shall be interpreted and construed in accordance
with, and shall be governed by, the laws of the State of Colorado and the
laws of the United States applicable in Colorado, without regard to the
choice of law rules of such State.
h. This Agreement may be executed in multiple counterparts, each of
which shall be decreed an original, but all of which together shall
constitute one and the same instrument.
i. Any change, modification, amendment or waiver must be in writing
and executed by a person authorized to execute the same in order to be
enforceable. No waiver by any party of any condition, or of the breach of
any term, provision, or covenant contained in this Agreement in one or more
instances shall be deemed to be or construed as a further or continuing
waiver of any such condition or the breach of any other term, provision, or
covenant.
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IN WITNESS WHEREOF, the Purchaser and the Company have
executed this Option Purchase and Assignment Agreement as of the ____ day of
____________________, 199___.
PURCHASER:
-----------------------------------
(Print Name)
-----------------------------------
(Signature)
Social Security or Tax I.D. Number:
-----------------------------------
Address:
===================================
U.S. WIRELESS DATA, INC.
By:________________________________
Title:______________________________
Address:
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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EXHIBIT 1
CONSIDERATION PAYABLE TO COMPANY
Option Assignment No. ____________
[To be provided by the Company prior to completing this Exhibit]
The consideration payable to the Company pursuant to paragraph 2 of the
Agreement for the Assigned Option shall be:
$________ per Option Share x __________ Option Shares = U.S. $
Purchaser's Signature:
EXHIBIT 2
FORM OF OPTION ASSIGNMENT NOTIFICATION
THE OPTION BEING ASSIGNED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT") OR ANY STATE OR FOREIGN LAW. THIS OPTION MAY
NOT BE SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (i) THEY SHALL HAVE
BEEN REGISTERED UNDER THE ACT AND ANY APPLICABLE STATE AND FOREIGN SECURITIES
ACT OR OTHER LAW OR (ii) AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE AND
THE CORPORATION SHALL HAVE BEEN FURNISHED WITH AN OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION, THAT REGISTRATION OR OTHER COMPLIANCE IS NOT
REQUIRED UNDER ANY OF SUCH ACTS OR LAWS.
OPTION ASSIGNMENT NO.______________________
FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF
WHICH IS HEREBY ACKNOWLEDGED, U.S. WIRELESS DATA, INC. (THE "COMPANY"), HEREBY
SELLS, ASSIGNS AND TRANSFERS UNTO:
WHOSE ADDRESS IS:
ALL OF THE COMPANY'S RIGHT, TITLE AND INTEREST IN AND TO, THE FOLLOWING OPTION
TO PURCHASE SHARES OF THE COMPANY'S COMMON STOCK OWNED OF RECORD BY TILLICOMBE
INTERNATIONAL LDC:
[State number of shares subject to Option being assigned and Company's
identifying information in terms of number of shares subject to Option out of
total number of shares subject to Option.]
IN WITNESS WHEREOF, THE UNDERSIGNED HAS EXECUTED THIS OPTION ASSIGNMENT
EFFECTIVE AS OF THE _________ DAY OF ________________, 1998, AND SUCH OPTION
ASSIGNMENT SHALL BE EFFECTIVE AT ANY TIME FROM THE DATE HEREOF AND CONTINUING
UNTIL MIDNIGHT ON OCTOBER 5, 1998.
U.S. WIRELESS DATA, INC.
By:
Title:
EXHIBIT 3
OPTION EXERCISE NOTIFICATION
TO: Ireland, Xxxxxxxxx, Xxxxx & Xxxxxx, P.C.
Escrow Agent
0000 Xxxxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxx X Xxxxx, Esq.
Telephone (000) 000-0000
Facsimile (000) 000-0000
The undersigned Purchaser, as the holder of an Assigned Option from
U.S. Wireless Data, Inc. (the "Company") to purchase shares of the Company's No
Par Value Common Stock presently owned of record by Tillicombe International
LDC, described by the Company as:
ASSIGNED OPTION NO. (the "Assigned Option"),
hereby exercises the Assigned Option and tenders herewith the Option Exercise
Price of $___________ (U.S. $.25 x Number of Shares Subject to Assigned Option),
effective as of this _________ day of _______________________, 1998.
You are hereby authorized and directed to cause the shares of Common Stock
issuable upon exercise of the Assigned Option to be registered in the name of:
and to be delivered as follows:
PURCHASER:
[Signature]
[Print Name]
[Signature Guarantee]
