FINANCING AGREEMENT
THIS AGREEMENT dated for reference July 15, 2000, is among Pacific Capital
Markets Inc., a British Columbia company of 0000 Xxxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0, and fax (000) 000-0000 ("PCMI"); and
Interface X.xxx, Inc., a Nevada company of 000 X. Xxxxxx Xxxxxx, #0, Xxxxxx
Xxxx, Xxxxxx, 00000, and fax care of (000) 000-0000("Interface"); and ViaPay
Technologies Limited, a United Kingdom company of 1000 Great Xxxx Xxxx,
Xxxxxxxxx, Xxxxxxxxx, Xxxxxxx, XX0 0XX, and fax 00 (0)000 000 0000 ("ViaPay").
WHEREAS PCMI has agreed to finance Interface for the development of its
business, which it conducts through ViaPay, its UK subsidiary, FOR VALUABLE
CONSIDERATION, the receipt and sufficiency of which are acknowledged, and the
following mutual promises, the parties agree that:
INTERPRETATION
1. The definitions in the recitals are part of this agreement.
2. In this agreement:
a. "Acquisition Agreement" means the acquisition agreement dated for
reference July 15, 2000, between Interface, Xxxxxxxx Xxxxx, Xxxx Xxxxx
and Gambrook Limited.
b. "Business Plan" means the business plan of ViaPay version 5.1 dated
July 2000.
c. "Closing" means the date on which this agreement is signed.
d. "Consulting Agreement" means the consulting agreement between PCMI and
Interface attached as exhibit A.
e. "Financing" means $12 million raised by the issuance of shares in the
common stock of Interface at $6.00 per share under available
registration exemptions.
f. "Loan" means $1 million loaned by PCMI to Xxxx Xxxxxxx and $500,000
loaned to ViaPay.
g. "Subscription Agreement" means a subscription for shares of common
stock of Interface under Regulation S of the United States securities
laws in the form attached as exhibit B.
h. "Term" means the period of time from Closing to the end of 15 August
2001.
i. "$" means United States dollars unless otherwise indicated.
THE TRANSACTION
The Financing
3. PCMI will arrange the Financing by delivering to Interface Subscription
Agreements from qualified investors for the appropriate number of shares of
Interface's common stock as set out in Table 1.
Table 1
Financing Schedule
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Number of shares Subscription Consulting Loan Net
Date @ $6 per share amount Agreement repayment proceeds
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15 Aug 2000 331,500 $ 1,989,000 $ 0 $ 0 $ 1,989,000
15 Sep 2000 307,500 1,845,000 500,000 0 1,345,000
15 Oct 2000 554,000 3,324,000 500,000 1,500,000 1,324,000
15 Nov 2000 486,500 2,919,000 500,000 0 2,419,000
15 Dec 2000 320,500 1,923,000 500,000 0 1,423,000
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2,000,000 $12,000,000 $ 2,000,000 $ 1,500,000 $ 8,500,000
----------------------------------------------------------------------------------------
Financing Agreement 2 / 5
4. PCMI will confirm that the proceeds of the Financing have been paid into
trust with Jeffs & Company, solicitors for PCMI, with instructions to pay
the net proceeds to Interface when Interface has accepted the subscription
and the subscriber has received the accepted Subscription Agreement.
5. Interface, as soon as practical after it accepts the Subscription
Agreements, will issue to the subscribers the required number of shares of
its common stock under Regulation S of the United States securities law or
other available registration exemption.
6. PCMI reserves the right to amend the schedule set out in Table 1 if
Interface or ViaPay fail to provide information that PCMI requests under
the Consulting Agreement.
7. Interface will advance the proceeds of the Financing to ViaPay. ViaPay will
use the proceeds to develop its business as described in the Business Plan.
8. Interface and ViaPay acknowledge that PCMI requires information about
Interface and ViaPay's business in order to interest prospective
subscribers to the Financing. Interface and ViaPay will provide any
information that PCMI reasonably requests in order to adequately inform
prospective subscribers.
Market Out
9. PCMI reserves the right to terminate all of its obligations under this
Agreement at any time if PCMI is of the reasonable opinion that the market
conditions are not favourable for the completion or continuation of the
Financing or if any event should develop that seriously affects or may
seriously affect the financial markets or the business of ViaPay.
Right of First Refusal on Additional Financing
10. Interface will give PCMI the right of first refusal to arrange any
additional financing for Interface. Interface will give PCMI written notice
of the terms and conditions of its requirements and its proposed use of
proceeds at least two months before it requires the financing. PCMI must
notify Interface in writing within one month of its receipt of the notice
whether it intends to exercise its right to arrange the financing. This
right of first refusal ends if PCMI refuses to arrange a specific
financing.
Consulting Agreement
11. Interface authorizes Jeffs & Company to pay to PCMI the amount of the
Consulting Agreement from the proceeds of the Financing as set out in Table
1.
Loan to Xxxx Xxxxxxx and ViaPay
12. Interface and ViaPay acknowledge that ViaPay has received the proceeds of
the Loan and authorize Jeffs & Company to repay the Loan to PCMI from the
proceeds of the Financing on October 15, 2000, as set out in Table 1.
Financing Agreement 3 / 5
Investor Relations
13. PCMI will conduct Interface's investor and public relations under the
Consulting Agreement.
CONDITIONS PRECEDENT
14. The following conditions must be satisfied before the Financing is advanced
as set out in Table 1:
a. The representations and warranties of Interface and ViaPay must be
true and correct in all material respects.
b. Gambrook Limited, Xxxxxxxx Xxxxx and Xxxx Xxxxx must sign the
Acquisition Agreement.
c. Interface must sign the Consulting Agreement and must not be in
default of any terms or conditions under the Consulting Agreement.
POSITIVE COVENANTS
Interface and ViaPay
15. Interface and ViaPay will immediately begin an audit of their financial
statements giving effect to the reverse merger completed under the
Acquisition Agreement.
16. Interface will, as soon as its financial statements have been audited, take
the steps that are necessary to
a. have its shares approved for quotation on a senior quotation medium or
listed for trading on a stock exchange, and
b. be listed in the Standard & Poor's Corporation Records with super
accelerated coverage.
17. During the Term, Interface and ViaPay and their successors, by merger or
other corporate reorganization, will
a. maintain their corporate existence,
b. carry on their business in a proper and businesslike manner in
accordance with good business practices, prudently manage their cash
resources, and keep proper books of account in accordance with
generally accepted accounting principles,
c. at the end of each week, deliver to PCMI a written progress report
describing any strategic or material modifications of the Business
Plan,
d. use their best efforts to complete each deliverable and milestone as
set out in the Business Plan and to provide PCMI with clear, accurate
and timely information concerning the status and progress of each
deliverable and milestone,
e. by the twentieth day of each month, deliver to PCMI their consolidated
financial statements for the preceding month consisting of a balance
sheet, statement of operations, statement of changes in shareholders'
equity, and statement of cash flow, all prepared in accordance with
accounting principals generally accepted in the United States, and
f. deliver to PCMI any other information that PCMI reasonably requests.
NEGATIVE COVENANTS
18. During the Term, neither Interface nor ViaPay will, without the written
consent of PCMI,
Financing Agreement 4 / 5
a. authorize the issuance of or issue any of their shares or other
securities except those authorized by this agreement,
b. authorize any changes to their charter documents unless the changes
are required to implement this agreement,
c. cause any of their assets to be encumbered, sold or transferred,
x. xxxxx options to their directors, officers and employees that may be
exercised during the Term, or
e. permit any of their subsidiaries and affiliates to take any of the
above listed actions or cause any dilution of Interface's interest in
ViaPay.
REPRESENTATIONS AND WARRANTIES
PCMI
19. PCMI represents and warrants that it has the experience and expertise
required to negotiate and finalize the Financing and to perform the
Consulting Agreement.
ViaPay
20. ViaPay represents and warrants that:
a. The Business Plan truly and accurately reflects its business.
b. It is a company formed and in good standing under the laws of United
Kingdom.
c. It has the legal capacity and authority to make and perform this
agreement.
d. It has conducted no other business except the business that is
described in the Business Plan.
e. No person has made a claim against it before any court or regulatory
authority, no claims are pending or threatened, and it is not aware of
any ground for any claim that might succeed.
OTHER PROVISIONS
21. Interface will pay all legal and other costs in connection with the making
and performing of this Agreement out of the proceeds of the Financing.
22. This is the entire agreement among the parties and replaces any earlier
understandings and agreements regarding financing, whether written or oral.
23. Time is of the essence of this agreement.
24. This agreement is governed by the laws of British Columbia and must be
litigated in the courts of British Columbia.
25. Any notice that must be given or delivered under this agreement must be in
writing and delivered by hand to the address or transmitted by fax to the
fax number given for the party on page 1 and is deemed to have been
received when it is delivered by hand or transmitted by fax unless the
delivery or transmission is made after 4:00 p.m. or on a non-business day
where it is received, in which case it is deemed to have been delivered or
transmitted on the next business day. Any payments of money must be
delivered by hand or wired as
Financing Agreement 5 / 5
instructed in writing by the receiving party. Any delivery other than a
written notice or money must be made by hand at the receiving party's
address.
26. Neither Interface nor ViaPay may assign this agreement or any part of it to
another party.
27. Any amendment of this agreement must be in writing and signed by the
parties.
28. This agreement enures to the benefit of and binds the parties and their
respective successors, heirs and permitted assignees.
29. No failure or delay of PCMI in exercising any right under this agreement
operates as a waiver of the right. PCMI's rights under this agreement are
cumulative and do not preclude PCMI from relying on or enforcing any legal
or equitable right or remedy.
30. If any provision of this agreement is, illegal or unenforceable under any
law, the remaining provisions remain legal and enforceable.
31. This agreement may be signed in counterparts and delivered to the parties
by fax, and the counterparts together are deemed to be one original
document.
THE PARTIES' signatures below are evidence of their agreement.
Pacific Capital Markets Inc. ViaPay Technologies Limited
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxx Xxxxx
------------------------------- -------------------------------
Authorized Signatory Authorized Signatory
August 16, 2000 August 16, 2000
Interface X.xxx, Inc.
/s/ Xxxxx Xxxxx
-------------------------------
/s/ Xxxxxxxxx Xxxxx, Xx. Authorized Signatory
------------------------------- August 16, 2000
Authorized Signatory
August 18, 2000
