Exhibit 10.19: Form of Series B Preferred Stock Subscription Agreement
THESE SECURITIES DISCUSSED HEREIN HAVE NOT BEEN REGISTERED WITH THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION (THE "SEC") OR THE SECURITIES
COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THIS SUBSCRIPTION
AGREEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL NOR A SOLICITATION OF AN OFFER
TO BUY THE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
WOULD BE UNLAWFUL. THE SECURITIES MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR
ASSIGNED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS, OR IN A TRANSACTION
WHICH IS EXEMPT FROM REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT AND
UNDER PROVISIONS OF APPLICABLE STATE SECURITIES LAWS.
VOICE MOBILITY INTERNATIONAL, INC.
SERIES B PREFERRED STOCK SUBSCRIPTION AGREEMENT
This SUBSCRIPTION AGREEMENT (this "AGREEMENT") is entered into as of
December 29, 2000, by and between Voice Mobility International, Inc., a Nevada
corporation (the "COMPANY") and the undersigned purchaser ("PURCHASER"). This
Agreement is executed in reliance upon the transaction exemption afforded by
either Regulation D or Regulation S, as promulgated by the United States
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "SECURITIES ACT").
RECITALS
A. WHEREAS, in consideration of Purchaser agreeing to pay cash in the
amounts set forth below, subject to the terms and conditions hereof, the Company
has agreed to sell and issue to Purchaser: (i) the number of shares ("SHARES")
of the newly designated Series B Non-Voting Convertible Preferred Stock of the
Company (the "SERIES B PREFERRED"), par value $0.001 per share, having the
rights, preferences and privileges set forth in the Certificate of Designation
of the Series B Preferred attached as EXHIBIT A hereto (the "CERTIFICATE OF
DESIGNATION"), and initially convertible into two (2) shares of Common Stock of
the Company, par value $0.001 per share ("COMMON STOCK"), and (ii) the number of
Class I Warrants, substantially in the form of EXHIBIT B attached hereto, to
acquire one (1) share of Common Stock per warrant, exercisable until on or prior
to November 29, 2003, at an exercise price of US$1.75 per share of Common Stock
acquired (a "WARRANT" and, collectively the "WARRANTS"), each as set forth next
to the signature page hereof. The shares of Series B Preferred and the Warrants,
and any shares of Common Stock issuable upon conversion of the Series B
Preferred and/or exercise of the Warrants, are collectively referred to herein
as the "SECURITIES".
B. WHEREAS, Purchaser and the Company wish to enter into this Agreement
providing for certain rights and restrictions with respect to Purchaser's
subscription for, purchase, ownership and transfer of the Securities.
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AGREEMENT
NOW, THEREFORE, for valuable and legally sufficient consideration, the
receipt and adequacy of which are hereby acknowledged:
1. SUBSCRIPTION.
1.1. SUBSCRIPTION. Subject to the terms and conditions hereof, in
consideration for the payment in cash, check, or by wire transfer of immediately
available U.S. funds, of the Purchase Price described in Section 1.3 below,
Purchaser hereby subscribes for and agrees to purchase (the "SUBSCRIPTION"), and
the Company agrees to issue to Purchaser, the number of Shares and Warrants set
forth on the signature page hereof.
1.2 FUNDING DATE. The total number of Shares and Warrants subscribed
for by Purchaser shall be issued by the Company to Purchaser on the Closing Date
(as defined below in Section 1.4), subject to receipt by the Company of payment
of the aggregate Purchase Price (as defined below in Section 1.3) for such
Securities.
1.3 PURCHASE PRICE. The Purchase Price per Share (the "PURCHASE
PRICE") shall be Three United States Dollars (US$3.00).
1.4 CLOSING. The closing of the Subscription (the "CLOSING") shall
take place effective as of December 29, 2000 (the "CLOSING DATE"). At the
Closing, the Company and Purchaser shall exchange fully executed copies of this
Agreement. Purchaser shall deliver the aggregate Purchase Price due and the
Company shall deliver the certificate or certificates representing the Shares,
registered in the name of Purchaser, and the Warrants subscribed for hereby. In
addition, at the Closing or thereafter, the parties shall deliver to each other
such other documents, filings and certificates as may be reasonably requested or
as may be necessary to effect the transactions contemplated hereby in accordance
with the legal requirements in effect in the United States.
1.5 TOTAL OFFERING. Purchaser acknowledges that the Company is
offering up to 666,667 shares of Series B Preferred and Warrants to acquire up
to 500,000 shares of Common Stock to be subscribed for and purchased by
Purchaser and other qualified investors. All such Securities shall be offered on
the same basis and at the same Purchase Price as the Securities being offered
hereunder to Purchaser and shall be subscribed for effective as of December 29,
2000. Each Purchaser will be required to execute and deliver a Subscription
Agreement in form identical to this Agreement.
2. PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser hereby
represents and warrants to the Company as follows:
2.1 EXEMPTION FROM REGISTRATION. None of the Securities have been
registered under the Securities Act, and are being or will be issued to
Purchaser in reliance upon the exemptions from such registration provided by
Section 4(2) of the Securities Act and Regulation D and/or Regulation S
promulgated thereunder. Purchaser acknowledges that the Company has
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not registered and will not register any of the Securities under the Securities
Act, and has not qualified and will not qualify any of the Securities under any
other applicable state or federal securities laws in reliance, in part, on
Purchaser's representations and warranties herein.
2.2 INVESTMENT INTENT. The Securities are being or will be acquired
by Purchaser for investment purposes for Purchaser's own account only and not
for sale or with a view to distribution of all or any part of such Securities.
No other person will have any direct or indirect beneficial interests in the
Securities.
2.3 ABILITY TO BEAR RISK. Purchaser can afford to bear the economic
risk of holding the Securities for an indefinite period and can afford to suffer
the complete loss of the investment.
2.4 ACCESS TO INFORMATION. Purchaser has been granted the opportunity
to ask questions of, and has received answers from, representatives of the
Company concerning the business, properties and condition of the Company and the
terms and conditions of the Subscription and has been granted the opportunity to
obtain any information that it deems necessary to undertake this investment.
2.5 REVIEW OF OFFERING MATERIALS. By execution of this Agreement,
Purchaser acknowledges having read, understood and agreed to each and every
provision of this Agreement, including EXHIBIT C hereto which sets forth the
definition of an "ACCREDITED INVESTOR" under the Securities Act. This Agreement
and the Exhibits hereto alone constitute, and are referred to herein as, the
"OFFERING MATERIALS". Except for the Offering Materials, Purchaser is not
relying on any other information relating to the offer and Subscription for the
Securities. Purchaser acknowledges that the Company has not described any risk
factors relating to the purchase of Securities in the Offering Materials or in
any other oral or written statement. Purchaser acknowledges that the Company has
offered to make available any additional public information that Purchaser may
reasonably request, and that the Company has offered Purchaser the Company's
full and unconditional cooperation in making such information available to
Purchaser. Purchaser acknowledges that the Company has recommended that
Purchaser request and review such information prior to making an investment
decision. No oral or written representations have been made, or oral or written
information furnished to Purchaser or its advisors, if any, in connection with
the offering of and Subscription for the Securities which were or are in any way
inconsistent with the Offering Materials.
2.6 RESTRICTED SECURITIES. Purchaser hereby confirms that Purchaser
has been informed that the Securities will be, when issued, "restricted
securities" under the Securities Act and may not be resold or transferred unless
first registered under the federal securities laws or unless an exemption from
such registration is available with respect to a resale in the United States or
in an "offshore transaction" (as such term is defined in Regulation S
promulgated under the Securities Act). Accordingly, Purchaser hereby
acknowledges that Purchaser is prepared to hold the Securities for an indefinite
period. Purchaser is aware that Rule 144 and Regulation S under the Securities
Act permit limited public resales of securities acquired in nonpublic offerings,
subject to the satisfaction of certain conditions. Purchaser understands that
under
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Rule 144 the conditions include, among other things: the availability of certain
current public information about the issuer, the resale occurring not fewer than
one (1) year or two (2) years, as applicable, after the party has purchased and
paid for the securities to be sold, the sale being through a broker in an
unsolicited "broker's transaction" and the amount of securities being sold
during any three-month period not exceeding specified volume limitations.
Purchaser acknowledges and understands that the Company may not be satisfying
the current public information requirement of Rule 144 at the time Purchaser
wishes to sell any of the Securities, or other conditions under Rule 144 which
are required of the Company. Purchaser understands that Regulation S, as
currently in effect, allows resales in private and public transactions in
certain circumstances, only in qualified offshore transactions and only when
certain holding periods of at least one (1) year have been fulfilled. Purchaser
understands that Purchaser may be precluded from selling any of the Securities
under Rule 144 or Regulation S even if the holding periods have been satisfied
either because the other conditions may not have been fulfilled or because
markets for resales do not exist. Prior to Purchaser's Subscription for the
Securities, Purchaser acquired sufficient information about the Company to reach
an informed and knowledgeable decision to subscribe for the Securities.
Purchaser has such knowledge and experience in financial and business matters as
to make Purchaser capable of utilizing said information to evaluate the risks of
the prospective investment and to make an informed investment decision.
2.7 NO FUTURE REGISTRATION. Purchaser understands and acknowledges
that the Company has no plans to, and will not, register any of the Securities
under the Securities Act.
2.8 ACCREDITED INVESTOR. Purchaser hereby makes the following
representations and warranties to the Company:
(a) He, she or it is an "Accredited Investor" as defined in
Regulation D promulgated under the Securities Act and defined in
EXHIBIT C hereto. The specific category or categories of
Accredited Investor applicable to Purchaser are as follows:
(1) I am a natural person and have a net worth, either alone or
with my spouse, in excess of US$1,000,000;
(2) I am a natural person and had individual income in excess of
US$200,000 (or joint income in excess of US$300,000
including income of my spouse) during each of the previous
two calendar years and expect to have individual income in
excess of such amount during the current calendar year;
(3) He, she or it is an authorized signatory for a partnership,
trust, corporation or other entity with a net worth of more
than US$5,000,000, or of which all the equity owners are
Accredited Investors;
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(4) The Securities are being acquired through an employee
benefit plan within the meaning of the Employee Retirement
Income Security Act of 1974 ("ERISA") that either (i) has
its investment decisions made by a plan fiduciary, as
defined in Section 3(21) of ERISA, which is a bank, savings
and loan association, insurance company or a registered
investment advisor, (ii) has total assets in excess of
US$5,000,000 or (iii) is a self-directed plan, with its
investment decisions made solely by Accredited Investors as
described herein (Accredited Investors making investment
decisions for self-directed plans must also check one of the
first three items of this Section 2.7(a)); and/or
(5) I am a director and/or executive officer of the Company.
(b) Purchaser has the ability to evaluate the risks and merits of the
investment and thus is able to protect Purchaser's interests as a
result of:
(1) Purchaser's business or financial experience;
(2) the business or financial experience of Purchaser's
professional advisors who are unaffiliated with and who are
not compensated by the Company either directly or
indirectly; and/or;
(3) Purchaser's pre-existing business relationship with the
Company or its officers, directors or controlling persons.
(c) Purchaser has had a reasonable opportunity to ask questions of
and receive answers from the Company and all such questions have
been answered to the full satisfaction of Purchaser. No oral or
written representations have been made, or oral or written
information furnished to Purchaser, in connection with the
offering of the Securities which was in any way inconsistent with
any information contained in the Offering Materials.
(d) Purchaser (i) has such knowledge and experience in financial and
business matters which enables Purchaser to evaluate the merits
and risks of the investment represented by the Securities, and to
protect Purchaser's own interests in connection with the
investment and/or (ii) has a preexisting personal or business
relationship with the Company or its officers, directors and/or
principal shareholders of a nature and duration which would
enable a reasonably prudent investor to be aware of the
character, business acumen and general business and financial
circumstances of the person with whom such relationship exists.
Purchaser recognizes that the acquisition of the Securities
involves special risks.
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(e) Purchaser is acquiring the Securities solely for Purchaser's own
account. Purchaser is acquiring such the Securities without a
view to, and not for resale in connection with, a distribution of
the Securities within the meaning of the Securities Act.
Purchaser hereby covenants and agrees that Purchaser shall not
sell any of the Securities in violation of the Securities Act.
(f) Purchaser is not relying on the Company or the information in the
Offering Materials for advice with respect to tax considerations
or the suitability of Purchaser's investment in the Company or
legal or economic considerations.
(g) Purchaser understands that none of the Securities have been
registered under the Securities Act or qualified under the
securities laws of any states and therefore cannot be
transferred, resold, pledged, hypothecated, assigned or otherwise
disposed of unless such are subsequently registered or qualified
under the Securities Act and under applicable state securities
laws, or an exemption from registration and/or qualification is
available. Purchaser will not sell or otherwise transfer any of
the Securities without registration under the Securities Act or
pursuant to an exemption therefrom.
(h) If Purchaser is a corporation, partnership, trust or other
entity, Purchaser represents and warrants that the corporation,
partnership, trust or other entity, is authorized and qualified
to become a shareholder of the Company; and such entity and
Purchaser signatory hereto for such shareholder further
represents and warrants that such signatory has been duly
authorized by the prospective shareholder to execute this
Agreement.
(i) If Purchaser is an employee benefit plan (a "PLAN"), the person
signing this Agreement on behalf of such Plan represents and
warrants that: (i) he or she is a fiduciary of the Plan, (ii) he
or she understands the investment objectives, strategies and
policies of the Plan, (iii) he or she acknowledges that he or she
is aware of the provision of Section 404 of ERISA relating to the
requirements for investment and diversification of assets of
ERISA-governed Plans, (iv) he or she has given appropriate
consideration to such Plan's investment in the Company and has
determined that such investment furthers the purposes of such
Plan and (v) he or she has determined that, taking into account
other investments in such Plan's portfolio, the Plan's investment
in the Securities is consistent with the requirements of Section
404 and other provisions of ERISA and is consistent with such
Plan's cash flow requirements and funding objectives.
(j) Purchaser understands that the Securities are restricted and may
not be liquidated, even in the event of an emergency, until such
are registered
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pursuant to the Securities Act. Purchaser also understands that,
for the foregoing reasons and until such time as the Securities
are registered under the Securities Act, the Securities may not
be readily accepted as collateral for a loan.
(k) Purchaser further certifies and acknowledges as follows:
(1) Purchaser has adequate means of providing for Purchaser's
current needs and possible personal or other contingencies,
and Purchaser has no need for liquidity of Purchaser's
investment in the Securities;
(2) Purchaser has a net worth sufficient to bear the economic
risk of losing Purchaser's entire investment in the
Securities;
(3) Each and every representation set forth herein is true and
correct; and
(4) Purchaser does not have an overall commitment to non-readily
marketable investments which is disproportionate to
Purchaser's net worth and the investment subscribed for
herein will not cause such overall commitment to become
excessive.
(l) The address set forth below is Purchaser's true and correct
residence and/or principal place of business, and Purchaser has
no present intention of becoming a resident of any other state or
jurisdiction.
(m) Purchaser acknowledges and is aware that the Securities are
speculative investments which involve a high degree of risk of
loss by Purchaser of Purchaser's investment in the Company.
(n) It has never been guaranteed or warranted to Purchaser by the
Company or by any other person, expressly or by implication,
that:
(1) Purchaser will be required to remain an owner of the
Securities any approximate or exact length of time;
(2) Purchaser will receive any approximate or exact amount of
return or other type of consideration, profit or loss as a
result of an investment in the Securities, or
(3) The past performance or experience on the part of the
Company, any director, officer or any affiliate thereof,
will in any way indicate or predict future operating results
of the Company or the overall success of the Company.
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(o) If Purchaser is more than one person, the obligations of
Purchaser shall be joint and several, and the representations and
warranties herein contained shall be deemed to be made by and be
binding upon such persons, and ownership of the Securities
subscribed for by Purchaser shall be as set forth on the
signature page attached hereto.
(p) At the request of the Company, Purchaser will promptly execute
such other instruments or documents as may reasonably be required
in connection with the purchase of the Securities. Purchaser
hereby agrees that the representations and warranties set forth
in this Agreement shall be binding upon the heirs, executors,
administrators, successors and assigns of Purchaser, but this
subscription is not voluntarily transferable or assignable by
Purchaser.
(q) Purchaser acknowledges and agrees that all representations,
warranties and covenants made by Purchaser to the Company in this
Agreement shall survive the issuance of Purchaser's Securities.
Purchaser agrees to protect, defend, indemnify and hold harmless
the Company from all losses, costs, expenses (including, without
limitation, reasonable attorney's fees and expenses) or
liabilities for any breach of Purchaser's representations,
warranties or covenants.
2.9 INDEPENDENT ASSESSMENT. Purchaser represents and warrants that in
making the decision to subscribe for the Securities, Purchaser has relied upon
independent consideration and investigations made by such Purchaser and further
that no representations have been made concerning the Securities, the Company,
its business, prospects, or other matters.
2.10 FOREIGN PERSONS. If Purchaser is not a resident of the United
States, Purchaser agrees to provide to the Company such additional
representations, warranties, covenants and undertakings as the Company may
request in order to comply with the applicable securities laws of the
jurisdiction(s) in which Purchaser is deemed to reside.
2.11 REGULATION S. If Purchaser is not a resident of the United
States, Purchaser hereby makes the following representations and warranties to
the Company:
(a) Purchaser certifies that Purchaser either: (i) is not a "U.S.
PERSON" (as defined in Regulation S) and is not subscribing for
the Securities for the benefit of a U.S. person; or (ii) is a
U.S. person who subscribed for the Securities in a transaction
that did not require registration under the Securities Act.
(b) Purchaser represents and warrants that it has no intention to
distribute, either directly or indirectly, any of the Securities
in the United States or to any U.S. person; PROVIDED, HOWEVER,
that Purchaser may sell or otherwise dispose of any of the
Securities pursuant to registration thereof under the
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Securities Act and any applicable state securities laws, or
pursuant to an exemption from such registration requirements.
(c) Purchaser acknowledges that it has not purchased the Securities
as a result of any "directed selling efforts" of any party (as
defined in Regulation S) in the United States.
2.12 SURVIVAL; INDEMNIFICATION. The foregoing representations and
warranties are made by Purchaser with the intent that they may be relied upon in
determining Purchaser's qualification and suitability to subscribe for the
Securities, and Purchaser hereby agrees that such representations and warranties
shall survive the acceptance of this Agreement by the Company and the issuance
of Securities to Purchaser. Purchaser hereby agrees to indemnify, defend and
hold harmless the Company, its representatives and agents and each other
shareholder of the Company from and against any and all losses, claims, damages,
liabilities, expenses (including reasonable attorneys' fees and disbursements),
judgments and amounts paid in settlement or actions resulting from the untruth
of any of the warranties and representations contained herein. Notwithstanding
the foregoing, however, no representation, warranty, acknowledgment, covenant or
agreement by Purchaser made herein shall in any manner be deemed to constitute a
waiver of any rights granted to him under the federal or state securities laws.
2.13 BROKERS. The Purchaser has not entered into any agreement for the
payment of any broker's or finder's fee or commission in connection with the
purchase or sale of the Securities.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
3.1 ORGANIZATION. The Company is a corporation validly existing and
in good standing under the laws of Nevada and has the requisite corporate power
and authority to own, lease and operate its properties and to carry on its
business in the manner now being conducted. The Company is not currently
qualified or licensed to do business as a foreign corporation in any
jurisdictions other than Nevada.
3.2 CORPORATE POWER AND AUTHORITY OF THE COMPANY. The Company has the
full corporate power and authority to execute and deliver this Agreement and to
perform its obligations under this Agreement. The execution, delivery and
performance of this Agreement by the Company have been authorized by all
necessary corporate actions required by law, the Company's Articles of
Incorporation, its Bylaws or otherwise to be taken to authorize the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby. This Agreement is a valid and binding agreement of the
Company, enforceable in accordance with its terms.
3.3 NO CONFLICT. Neither the execution and delivery of this Agreement
nor the consummation by the Company of the transactions contemplated hereby will
(a) conflict with or result in a breach of any provision of its Articles of
Incorporation or Bylaws, (b) result in a default (or give rise to any right of
termination, cancellation or acceleration) under any of the
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terms, conditions or provisions of any material note, bond, mortgage, indenture,
franchise, license, permit or agreement or other instrument or obligation to
which the Company is a party or by which the Company is bound or to which any of
the assets of the Company is subject, (c) violate in any material respect any
statute or law or any judgment, decree, order, writ, injunction, regulation or
rule applicable to the Company, or (d) result in or require the creation of any
material lien with respect to any assets of the Company.
3.4 CERTIFICATE OF DESIGNATION. THE CERTIFICATE OF DESIGNATION WITH
RESPECT TO THE SERIES B PREFERRED HAS BEEN DULY FILED WITH THE SECRETARY OF
STATE OF THE STATE OF NEVADA.
3.5. BROKERS. The Company has not entered into any agreement for the
payment of any broker's or finder's fee or commission in connection with the
purchase or sale of the Securities.
4. COVENANTS.
4.1 ESCROW AGREEMENT. IMMEDIATELY UPON THE CLOSING, THE PARTIES SHALL
ESTABLISH AN ESCROW ACCOUNT WITH OB SERVICES INC., OF SUITE 2900 - 000 XXXXXXX
XXXXXX, XXXXXXXXX, X.X. X0X 0X0 (THE "ESCROW AGENT") TO BE GOVERNED BY AN ESCROW
AGREEMENT IN THE FORM OF EXHIBIT D ATTACHED HERETO (THE "ESCROW AGREEMENT"). THE
COMPANY SHALL DEPOSIT THE AGGREGATE PURCHASE PRICE RECEIVED FOR THE SHARES AND
THE WARRANTS WITH THE ESCROW AGENT AND THE PURCHASERS SHALL DEPOSIT THE
CERTIFICATES REPRESENTING THE SHARES AND THE WARRANTS WITH THE ESCROW AGENT, THE
RELEASE OF WHICH SHALL BE GOVERNED BY THE ESCROW AGREEMENT.
4.2 USE OF PROCEEDS. THE COMPANY SHALL USE THE PROCEEDS FROM THE SALE
OF THE SHARES TO FUND A BUDGET TO BE APPROVED BY THE BOARD OF DIRECTORS OF THE
COMPANY
4.3 GENERAL RESTRICTIONS ON TRANSFER. Purchaser hereby agrees that
he, she or it shall sell not, transfer, assign or distribute, either directly or
indirectly, any of the Securities other than in accordance with and pursuant to
the Securities Act. In the case of non-U.S. persons (as defined in Regulation
S), Purchaser agrees that it shall not sell, transfer, assign or distribute,
either directly or indirectly, any of the Securities in the United States or to
any U.S. person until at least one (1) year after the Company has issued such
Securities to Purchaser. Purchaser further agrees that he, she or it will not
transfer, assign or distribute, either directly or indirectly, any of the
Securities pursuant to an exemption from registration under the Securities Act
and any applicable state securities laws unless all appropriate action necessary
for compliance with such exemption (including Rule 144 promulgated under the
Securities Act) shall have been taken. As a condition to any transfer of the
Securities, the Company shall require that any transferee
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execute a joinder to this Agreement to be a party to this Agreement and be bound
by the terms hereof.
4.4 NO RECORDATION OF TRANSFER. The Company shall not be required to:
(i) transfer on its books any Securities or shares of Preferred Stock or Common
Stock that have been sold, transferred, assigned or distributed in violation of
the provisions of Section 4.3, or (ii) treat as the owner of the Securities or
shares of Common Stock, or otherwise accord voting or dividend rights to, any
transferee to whom Securities or shares of Common Stock have been transferred in
contravention of this Agreement.
4.5 NO DIRECTED SELLING EFFORTS. Purchaser agrees that Purchaser will
not engage in any "directed selling efforts" (as defined in Regulation S
promulgated under the Securities Act) with respect to any of the Securities;
PROVIDED, HOWEVER, that Purchaser may sell or otherwise dispose of the
Securities pursuant to registration thereof under the Securities Act and any
applicable state securities laws, or pursuant to an exemption from such
registration requirements.
4.6 EXERCISE OF WARRANTS. Purchaser acknowledges and agrees that the
Warrants may not be exercised in the United States or by or on behalf of a U.S.
person unless it has been registered under the Securities Act and any applicable
state securities laws or unless an exemption from such registration requirements
is available.
4.7 RESTRICTION ON HEDGING. Purchaser agrees not to engage in any
hedging transactions except in compliance with the Securities Act.
4.8 SHARE CERTIFICATE LEGEND. A copy of this Agreement shall be filed
with the Secretary of the Company and kept with the records of the Company. Each
certificate representing shares of Series B Preferred Stock and shares of Common
Stock issued to Purchaser upon exercise of Warrants and/or conversion of the
Series B Preferred Stock, shall bear upon its face the following legend:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR UNDER SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, AS
APPLICABLE, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT (A) IN ACCORDANCE WITH
THE PROVISIONS OF REGULATION S PROMULGATED UNDER THE SECURITIES ACT,
(B) PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT AND APPROPRIATE
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY APPLICABLE STATE, OR
(C) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS. NO HEDGING
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TRANSACTIONS INVOLVING THE SECURITIES EVIDENCED BY THIS CERTIFICATE
MAY BE CONDUCTED EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT.
If required by the authorities of any state or other jurisdiction in
connection with the issuance of the Securities, the legend or legends required
by such jurisdiction shall also be endorsed on all such certificates. Purchaser
shall be bound by the requirements of the foregoing legends to the extent that
such legends are applicable.
4.9 AUTHORIZED SHARES. The Company covenants that so long as shares
of Series B Preferred are outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of the Common Stock upon conversion of the Series B Preferred. The Company
further covenants that its issuance of this Warrant shall constitute full
authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of
Common Stock upon conversion of the Series B Preferred.
5. GENERAL PROVISIONS.
5.1 AMENDMENT AND MODIFICATION. This Agreement may be amended,
modified or supplemented only by a written agreement executed by the parties
hereto.
5.2 ASSIGNMENT. The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs,
legal representatives, successors and assigns.
5.3 FURTHER ASSURANCES. Each party hereto or person subject hereto
shall do and perform or cause to be done and performed all such further acts and
things and shall execute and deliver all such other agreements, certificates,
instruments and documents as any other party hereto or person subject hereto may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transaction contemplated hereby.
5.4 GOVERNING LAW. This Agreement and the rights and obligations of
the parties hereunder and the persons subject hereto shall be governed by, and
construed and interpreted in accordance with, the law of the State of Nevada,
without giving effect to the conflict of law principles thereof.
5.5 INVALIDITY OF PROVISION. The invalidity or unenforceability of
any provision of this Agreement in any jurisdiction shall not affect the
validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of this Agreement, including that
provision, in any other jurisdiction.
5.6 NOTICES. All notices and other communications hereunder shall be
in writing and, unless otherwise provided herein, shall be deemed duly given if
delivered personally, by telecopy or mailed by registered or certified mail
(return receipt requested) or by
97
overnight courier service to the parties at the following addresses or (at such
other address for the party as shall be specified by like notice):
(a) If to the Company:
Voice Mobility International, Inc.
000-00000 Xxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
Attn: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copy to:
Crosby, Heafey, Xxxxx & May
0000 Xxxxxx xx xxx Xxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxx X. Xxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(b) If to Purchaser, at the address on the signature page of this
Agreement.
5.7 HEADINGS; EXECUTION IN COUNTERPARTS. The headings and captions
contained herein are for convenience and shall not control or affect the meaning
or construction of any provision hereof. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and
which together shall constitute one and the same instrument.
5.8 ENTIRE AGREEMENT. This Agreement, together with the Escrow
Agreement and the Warrants, embodies the entire agreement and understanding of
the parties hereto in respect of the subject matter contained herein. This
Agreement supersedes all prior agreements and understandings among the parties
with respect to the purchase of Securities.
5.9 INJUNCTIVE RELIEF. The Securities cannot readily be purchased or
sold in the open market and, for that reason, among others, the Company will be
irreparably damaged in the event this Agreement is not specifically enforced.
Each of the parties therefore agrees that in the event of a breach of any
provision of this Agreement, the aggrieved party may elect to institute and
prosecute proceedings in any court of competent jurisdiction to enforce specific
performance or to enjoin the continuing breach of this Agreement. Such remedies
shall, however, be cumulative and not exclusive, and shall be in addition to any
other remedy which the Company or Purchaser may have. Each party hereby
irrevocably submits to the nonexclusive jurisdiction of the state and federal
courts in Nevada for the purposes of any suit, action or other proceeding
arising out of or based upon this Agreement or the subject matter hereof. Each
party hereby consents to service of process by mail made in accordance with
Section 5.6.
98
5.10 ATTORNEYS' FEES. If any legal action or any arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default or misrepresentation in connection with any of
the provisions of this Agreement, the successful or prevailing party or parties
shall be entitled to recover such reasonable attorneys' fees and other costs
incurred in that action or proceeding, in addition to any other relief to which
it or they may be entitled, as may be ordered in connection with such
proceeding.
5.11 U.S. DOLLARS. Unless otherwise indicated, all references to "$"
or "dollars" refers to U.S. dollars.
5.12 ACCEPTANCE OF SUBSCRIPTION BY THE COMPANY. Purchase understands
and agrees that the Company's acceptance of the subscription of the Purchaser of
Securities under this Agreement shall be evidenced solely by the Company's
execution of this Agreement at the Closing for Purchaser's purchase of
Securities.
IN WITNESS WHEREOF, Purchaser has executed this Agreement as
of December 29, 2000.
Number of Shares of Series B Preferred Stock (@$3.00 per Share):__________
Number of Class I Warrants to Purchase Common Stock:__________
Total Purchase Price: $__________
SIGNATURE FOR PARTNERSHIP, TRUST, LLC. CORPORATION OR OTHER ENTITY:
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(Print Name of Entity)
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(Signature)
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(Print Name of Signatory)
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(Title)
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(Print Type of Entity and Jurisdiction)
-----------------------------------------
(Address)
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(U.S. Taxpayer Identification Number, If Applicable)
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(Telephone Number)
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(Telecopy Number)
[SIGNATURE PAGE NO. 1 TO AGREEMENT]
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ACCEPTANCE:
The subscription of the above-named Purchaser is hereby accepted by the Company,
as of December 29, 2000.
VOICE MOBILITY INTERNATIONAL, INC., A NEVADA CORPORATION
By:
---------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[SIGNATURE PAGE NO. 2 TO AGREEMENT]
100
EXHIBIT A
CERTIFICATE OF DESIGNATION
OF
VOICE MOBILITY INTERNATIONAL, INC.
Providing for the Powers, Designations, Preferences and
Relative, Participating, Optional and Other Special Rights,
and the Qualifications, Limitations or Restrictions Thereof
of Series B Non-Voting Convertible Preferred Stock
The undersigned, Xxx X'Xxxxxxxx and Xxxxx Xxxxxx, hereby certify that:
ONE: They are the duly elected and acting President and Assistant
Secretary, respectively, of Voice Mobility International, Inc. (the
"Corporation").
TWO: The Board of Directors of the Corporation, pursuant to the provisions
of its Articles of Incorporation, duly adopted the following resolutions:
RESOLVED, that there is hereby established a series of the Corporation's
preferred stock, par value $.001 per share, to be designated "Series B
Non-Voting Convertible Preferred Stock" and to the extent that the powers,
designation, preferences and relative, participating, optional and other
special rights, and the qualifications, limitations and restrictions
thereof, of such series, are not fixed by the amended Articles of
Incorporation of the Corporation, they are hereby fixed as set forth in
Exhibit 1 below.
THREE. The number of Series B Non-Voting Convertible Preferred Stock
authorized shall be 666,667 shares and there are no shares of Series B
Non-Voting Convertible Preferred Stock currently outstanding.
IN WITNESS WHEREOF, the undersigned have executed this certificate as of
the 27th day of December, 2000.
------------------------------------
Xxx X'Xxxxxxxx, President
------------------------------------
Xxxxx Xxxxxx, Assistant Secretary
EXHIBIT 1
Powers, Designations, Preferences and
Relative, Participating, Optional and Other Special Rights,
and the Qualifications, Limitations or Restrictions Thereof
of Series B Non-Voting Convertible Preferred Stock
1. DESIGNATION AND AMOUNT. 666,667 shares of preferred stock, $.001 par
value per share, is hereby constituted as a series of the preferred stock of the
Corporation which shall be designated "Series B Non-Voting Convertible Preferred
Stock" (the "Series B Preferred"), the preferences and relative, optional and
other special rights of which and the qualifications, limitations or
restrictions of which are set forth herein.
2. DIVIDENDS. The holders of the Series B Preferred shall be entitled to
receive dividends out of funds legally available therefor, prior and in
preference to any declaration or payment of any dividend (payable other than in
Common Stock or other securities and rights convertible into or entitling the
holder thereof to receive, directly or indirectly, additional shares of Common
Stock of the Corporation) on the Common Stock of the Corporation, at the rate of
$13.00 per share of Series B Preferred per annum, due payable with respect to
each share of Series B Preferred, on the last day of each month following the
issuance of such share of the Series B Preferred. Such dividends shall not be
cumulative. Such dividends shall accrue to holders of the Series B Preferred
until paid by the Corporation. No dividends or other distributions shall be made
with respect to the Common Stock, other than dividends payable solely in Common
Stock, unless at the same time an equivalent dividend with respect to the Series
B Preferred has been paid or set apart for payment.
3. LIQUIDATION, DISSOLUTION OR WINDING UP. In the event of any
liquidation, dissolution or winding up of the Corporation, the holders of the
Series B Preferred shall not be entitled to any portion of any distribution.
4. CONVERSION. The holders of the Series B Preferred shall have
conversion rights as follows:
(a) RIGHT TO CONVERT. Subject to Section 4(b) below, each share of
Series B Preferred shall be convertible, at the option of the holder thereof, at
any time after the date of issuance of such share, at the office of the
Corporation or any transfer agent for the Series B Preferred, into such number
of fully paid and nonassessable shares of Common Stock as is determined by
dividing $3.00 by the Series B Conversion Price, determined as hereinafter
provided, in effect at the time of conversion (the "Series B Conversion Rate").
The "Series B Conversion Price" shall initially be $1.50 per share of Common
Stock and shall be subject to further adjustment as hereinafter provided.
(b) AUTOMATIC CONVERSION. Each share of Series B Preferred shall
automatically be converted into shares of Common Stock at the then effective
Series B Conversion Rate upon the earlier of either (i) June 30, 2001, or (ii)
the written consent of the holders of a majority of the then outstanding shares
of Series B Preferred, voting together as a single class.
(c) MECHANICS OF CONVERSION. No fractional shares of Common Stock
shall be issued upon conversion of the Series B Preferred; the number of shares
of Common Stock issuable upon conversion of the Series B Preferred shall be
rounded down to the nearest whole number of shares of Common Stock. Before any
holder of the Series B Preferred shall be entitled to convert the same into full
shares of Common Stock and to receive certificates therefor, such holder shall
surrender the certificate or certificates therefor, duly endorsed, at the office
of the Corporation or of any transfer agent for the Series B Preferred, and
shall give written notice to the Corporation at such office that such holder
elects to convert the same; PROVIDED, HOWEVER, that in the event of a conversion
pursuant to Section 4(b), the outstanding shares of the Series B Preferred shall
be converted automatically without any further action by the holders of such
shares and whether or not the certificates representing such shares are
surrendered to the Corporation or its transfer agent; and PROVIDED, FURTHER,
that the Corporation shall not be obligated to issue certificates evidencing the
shares of Common Stock issuable upon such conversion unless the certificates
evidencing such shares of the Series B Preferred are either delivered to the
Corporation or its transfer agent as provided above, or the holder notifies the
Corporation or its transfer agent that such certificates have been lost, stolen
or destroyed and executes an agreement satisfactory to the Corporation to
indemnify it for losses incurred as a result of the loss of such certificates.
The Corporation shall, as soon as practicable after such delivery, or such
agreement and indemnification in the case of a lost certificate, issue and
deliver at such office to such holder of the Series B Preferred, a certificate
or certificates for the number of shares of Common Stock to which such holder
shall be entitled as aforesaid. Such conversion shall be deemed to have been
made immediately prior to the close of business on the date of such surrender of
the shares of the Series B Preferred to be converted, or, in the case of
automatic
conversion, on the date of closing of the offering or the effective date of such
written consent, as the case may be, and the person or persons entitled to
receive the shares of Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder or holders of such shares of
Common Stock on such date.
(d) ADJUSTMENTS TO CONVERSION PRICE.
(i) ADJUSTMENTS FOR SUBDIVISIONS OR COMBINATIONS OF OR STOCK
DIVIDENDS ON COMMON STOCK. In the event the outstanding shares of Common Stock
shall be subdivided (by stock split or otherwise), into a greater number of
shares of Common Stock, or the Corporation at any time or from time to time
after the original issue date of the Series B shall declare or pay any dividend
on the Common Stock payable in Common Stock, the Series B Conversion Rate then
in effect shall, concurrently with the effectiveness of such subdivision or
stock dividend, be proportionately increased based on the ratio of (A) the
number of shares of Common Stock outstanding immediately after such subdivision
or stock dividend to (B) the number of shares of Common Stock outstanding
immediately prior to such subdivision or stock dividend. In the event the
outstanding shares of Common Stock shall be combined or consolidated, by
reclassification or otherwise, into a lesser number of shares of Common Stock,
the Series B Conversion Rate then in effect shall, concurrently with the
effectiveness of such combination or consolidation, be proportionately decreased
on the same basis.
(e) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Conversion Price or Conversion Rate of the
Series B Preferred pursuant to this Section 4, the Corporation at its expense
shall promptly compute such adjustment or readjustment in accordance with the
terms hereof and furnish to each holder of Series B Preferred a certificate
setting forth such adjustment or readjustment and showing in detail the facts
upon which such adjustment or readjustment is based. The Corporation shall, upon
the written request at any time of any holder of Series B Preferred, furnish or
cause to be furnished to such holder a like certificate setting forth (i) such
adjustments and readjustments, (ii) the respective Conversion Price and the
Conversion Rate at the time in effect and (iii) the number of shares of Common
Stock and the amount, if any, of other property which at the time would be
received upon the conversion of the Series B Preferred.
(f) RESERVATION OF STOCK ISSUABLE UPON CONVERSION. The Corporation
shall at all times reserve and keep available out of its authorized but unissued
shares of Common Stock solely for the purpose of effecting the conversion of the
shares of the Series B Preferred such number of its shares of Common Stock as
shall from time to time be sufficient to effect the conversion of all
outstanding shares of the Series B Preferred; and if at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the conversion of all then outstanding shares of the Series B Preferred, in
addition to such other remedies as shall be available to the holder of such
Series B Preferred, the Corporation will take such corporate action as may, in
the opinion of counsel, be necessary to increase its authorized but unissued
shares of Common Stock to such number of shares as shall be sufficient for such
purposes.
4. RIGHT OF REDEMPTION. Unless otherwise agreed by the holders of
Series B Preferred, the Corporation shall not have the right to call or redeem
at any time all or any shares of Series B Preferred.
5. VOTING RIGHTS. Except as otherwise provided herein or by
applicable law, holders of the Series B Preferred shall not be entitled to any
voting rights and powers, and shall not be entitled to vote with respect to any
matters upon which holders of Common Stock have the right to vote; provided
however, that so long as shares of Series B Preferred shall be outstanding,
holders of the Series B Preferred shall be entitled to notice of any
shareholders' meeting in accordance with the Bylaws of the Corporation.
6. REACQUIRED SHARES. If any shares of Series B Preferred should be
purchased, retracted or otherwise acquired by the Corporation in any manner
whatsoever, then such shares of Series B Preferred shall be retired and canceled
promptly after acquisition thereof. Such shares upon cancellation, and upon the
taking of any action required by applicable law, shall become authorized but
unissued preferred shares and may be reissued as part of a new series of
preferred stock to be created by resolution or resolutions of the Board of
Directors of the Corporation, subject to the conditions and restrictions on
issuance set forth herein.
EXHIBIT B
FORM OF CLASS I WARRANT
THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). SUCH
SECURITIES MAY NOT BE OFFERED OR SOLD OR TRANSFERRED IN THE UNITED STATES OR TO
U.S. PERSONS IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
THE SECURITIES ACT WHICH, EXCEPT IN THE CASE OF AN EXEMPTION PURSUANT TO (A)
RULE 144 UNDER THE SECURITIES ACT, OR (B) REGULATION S PROMULGATED UNDER THE
SECURITIES ACT, IS CONFIRMED IN A LEGAL OPINION SATISFACTORY TO THE COMPANY.
Warrant No. I- ________ Date: December 29, 2000
Warrant Expiration Date: November 29, 2003
CLASS I STOCK PURCHASE WARRANT
TO PURCHASE SHARES OF COMMON STOCK OF
VOICE MOBILITY INTERNATIONAL, INC.
THIS CLASS I STOCK PURCHASE WARRANT (this "WARRANT") certifies that, for
value received, _______________________________ (the "INVESTOR"), is entitled,
upon the terms and subject to the conditions hereinafter set forth, at any time
after the date hereof and on or prior to November 29, 2003 (the "TERMINATION
DATE"), but not thereafter, to subscribe for and purchase from VOICE MOBILITY
INTERNATIONAL, INC., a Nevada corporation (the "COMPANY"),______________________
shares of Common Stock (the "WARRANT SHARES") on the terms and at the Exercise
Price set forth below. This Warrant is being issued in connection with that
certain Series B Preferred Stock Subscription Agreement (the "AGREEMENT"), dated
as of even date herewith, between the Company and Investor, and is subject to
the terms of the Agreement. This Warrant comprises a portion of Securities
subscribed for and purchased by Investor pursuant to the Agreement. Capitalized
terms not otherwise defined herein shall have that meaning as set forth in the
Agreement. In the event of any conflict between the terms of this Warrant and
the Agreement, the Agreement shall control.
The purchase price of one share of Common Stock (the "EXERCISE PRICE")
under this Warrant shall be shall be One Dollar and Seventy-Five Cents
(US$1.75). The Exercise Price and the number of shares for which the Warrant is
exercisable shall be subject to adjustment as provided herein.
1. TITLE OF WARRANT. This Warrant shall be issued in the name of the
Investor. This Warrant is not transferable.
2. AUTHORIZATION OF SHARES. The Company covenants that all shares of
Common Stock which may be issued upon the exercise of rights represented by this
Warrant will, upon exercise of the rights represented by this Warrant and
payment in full of the Exercise Price, be duly authorized, validly issued, fully
paid and nonassessable and free from all taxes, liens and
charges in respect of the issue thereof (other than taxes in respect of any
transfer occurring contemporaneously with such issue).
3. EXERCISE OF WARRANT. This Warrant may not be exercised in the United
States or by or on behalf of a U.S. person unless it has been registered under
the Securities Act of 1933, as amended (the "SECURITIES ACT"), and any
applicable State securities laws, or unless an exemption from such registration
requirements is available. Exercise of the purchase rights represented by this
Warrant may be made at any time or times one day after the date hereof, in whole
or in part, before the close of business on the Termination Date by the
surrender of this Warrant and the Notice of Exercise annexed hereto duly
executed, at the office of the Company (or such other office or agency of the
Company as it may designate by notice in writing to the Investor at the address
of the Investor appearing on the books of the Company) and upon payment of the
Exercise Price of the shares thereby purchased; whereupon the Investor shall be
entitled to receive a certificate for the number of shares of Common Stock so
purchased. Certificates for shares purchased hereunder shall be delivered to the
Investor within five (5) business days after the date on which this Warrant
shall have been exercised as aforesaid. Payment of the Exercise Price of the
shares may be by certified check or cashier's check or by wire transfer to an
account designated by the Company in an amount equal to the Exercise Price
multiplied by the number of shares being purchased.
4. NO FRACTIONAL SHARES OR SCRIP. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant.
5. CHARGES, TAXES AND EXPENSES. Issuance of certificates for shares of
Common Stock upon the exercise of this Warrant shall be made without charge to
the Investor for any issue or transfer tax or other incidental expense in
respect of the issuance of such certificate, all of which taxes and expenses
shall be paid by the Company, and such certificates shall be issued in the name
of the Investor.
6. RESTRICTIONS ON TRANSFER OF WARRANT SHARES.
(a) Investor hereby agrees that Investor shall sell not, transfer,
assign or distribute, either directly or indirectly, any of the Warrant Shares
other than in accordance with and pursuant to the Securities Act and any
exemptions from registration thereunder, including without limitation, Rule 144
or Regulation S. Notwithstanding the foregoing, Investor agrees that it shall
not sell, transfer, assign or distribute, either directly or indirectly, any of
the Warrant Shares in the United States or to any U.S. person until at least one
(1) year after the Company has issued such Warrant Shares to Investor. Investor
further agrees that Investor will not transfer, assign or distribute, either
directly or indirectly, any of the Warrant Shares pursuant to an exemption from
registration under the Securities Act and any applicable State securities laws
unless all appropriate action necessary for compliance with such exemption
(including Rule 144 promulgated under the Securities Act) shall have been taken.
Any transferee of the Warrant Shares must agree in writing to comply with the
provisions of this Section 6(a) with respect to any resale or other disposition
of such securities.
(b) The Company shall not be required to: (i) transfer on its books
any Warrant Shares that have been sold, transferred, assigned or distributed in
violation of the provisions of Section 6(a), or (ii) treat as the owner of the
Warrant Shares, or otherwise to accord voting or dividend rights to, any
transferee to whom Warrant Shares have been transferred in contravention of this
Agreement.
(c) Unless the Warrant Shares have been registered under the
Securities Act, or are exempt from registration, upon exercise of the Warrant or
any portion thereof and the issuance of any Warrant Shares, all certificates
representing Warrant Shares shall bear on the face thereof substantially the
following legend:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR UNDER SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION, AS
APPLICABLE, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT (A) IN ACCORDANCE WITH
THE PROVISIONS OF REGULATION S PROMULGATED UNDER THE SECURITIES ACT,
(B) PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT AND APPROPRIATE
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY APPLICABLE STATE, OR
(C) PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS. NO HEDGING
TRANSACTIONS INVOLVING THE SECURITIES EVIDENCED BY THIS CERTIFICATE
MAY BE CONDUCTED EXCEPT IN COMPLIANCE WITH THE SECURITIES ACT.
The Investor agrees and acknowledges that this Warrant is being purchased for
its own account, for investment purposes only, and not for the account of any
other person, and not with a view to distribution, assignment, pledge or resale
to others or to fractionalization in whole or in part. The Investor further
represents, warrants and agrees as follows: no other person has or will have a
direct or indirect beneficial interest in this Warrant and the Investor will not
sell, hypothecate or otherwise transfer the Warrant except in accordance with
the Securities Act and applicable state securities laws or unless, in the
opinion of counsel for the Investor acceptable to the Company, an exemption from
the registration requirements of the Securities Act and such laws is available.
7. CLOSING OF BOOKS. The Company will at no time close its shareholder
books or records in any manner which interferes with the timely exercise of this
Warrant.
8. NO RIGHTS AS SHAREHOLDER UNTIL EXERCISE. This Warrant does not entitle
the Investor to any voting rights or other rights as a shareholder of the
Company prior to the exercise thereof. If, however, at the time of the surrender
of this Warrant and purchase of Warrant Shares the Investor shall be entitled to
exercise this Warrant, the shares so purchased shall be and be deemed to be
issued to the Investor as the record owner of such shares as of the close of
business on the date on which this Warrant shall have been exercised.
9. LOSS, THEFT, DESTRUCTION OR MUTILATION OF WARRANT. The Company
represents and warrants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of any Warrant,
and in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and upon reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of such
Warrant, if mutilated, the Company will make and deliver a new Warrant of like
tenor and dated as of such cancellation, in lieu of this Warrant.
10. SATURDAYS, SUNDAYS, HOLIDAYS, ETC. If the last or appointed day for
the taking of any action or the expiration of any right required or granted
herein shall be a Saturday, Sunday or a legal holiday in the United States, then
such action may be taken or such right may be exercised on the next succeeding
day not a Saturday, Sunday or legal holiday.
11. ADJUSTMENTS OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. In the
event of any stock split, reverse stock split, stock dividend, reclassification
or similar event affecting the Common Stock occurring after the date hereof
(each an "ADJUSTMENT TRANSACTION"), (i) the Exercise Price shall be adjusted by
multiplying it by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such Adjustment
Transaction, and the denominator of which shall be the number of shares of
Common Stock outstanding immediately after such Adjustment Transaction, and (ii)
the number of Warrant Shares purchasable upon exercise of this Warrant
immediately prior thereto shall be adjusted by multiplying it by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
immediately after such Adjustment Transaction, and the denominator of which
shall be the number of shares of Common Stock outstanding immediately prior to
such Adjustment Transaction; PROVIDED, HOWEVER, that the Company shall not issue
any fractional shares of Common Stock in any exercise of this Warrant, and the
number of shares of Common Stock issuable upon such exercise, if not a whole
number, shall be rounded up to the next whole number of shares.
12. VOLUNTARY ADJUSTMENT BY THE COMPANY. The Company may at its
discretion, at any time during the term of this Warrant, reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate by
the Board of Directors of the Company.
13. NOTICE OF ADJUSTMENT. Whenever the number of Warrant Shares or number
or kind of securities or other property purchasable upon the exercise of this
Warrant or the Exercise Price is adjusted as herein provided, the Company shall
promptly mail by registered or certified mail, return receipt requested, to the
Investor notice of such adjustment or adjustments setting forth the number of
Warrant Shares (and other securities or property) purchasable upon the exercise
of this Warrant and the Exercise Price of such Warrant Shares after such
adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth computation by which such adjustment was made. Such
notice, in absence of manifest error, shall be conclusive evidence of the
correctness of such adjustment.
14. AUTHORIZED SHARES. The Company covenants that during the period the
Warrant is outstanding, it will reserve from its authorized and unissued Common
Stock a sufficient number
of shares to provide for the issuance of the Warrant Shares upon the exercise of
any rights under this Warrant. The Company further covenants that its issuance
of this Warrant shall constitute full authority to its officers who are charged
with the duty of executing stock certificates to execute and issue the necessary
certificates for shares of the Company's Common Stock upon the exercise of the
purchase rights under this Warrant. The Company will take all such reasonable
action as may be necessary to assure that such shares of Common Stock may be
issued as provided herein without violation of any applicable law or regulation,
or of any requirements of the OTC Bulletin Board or any domestic securities
exchange upon which the Common Stock may be listed.
15. MISCELLANEOUS.
(a) ISSUE DATE; JURISDICTION. The provisions of this Warrant shall be
construed and shall be given effect in all respects as if it had been issued and
delivered by the Company on the date hereof. This Warrant shall be binding upon
any successors or assigns of the parties hereto. This Warrant shall constitute a
contract under the laws and jurisdiction of the state of Nevada and for all
purposes shall be construed in accordance with and governed by the laws of said
state without regard to its conflict of law, principles or rules.
(b) RESTRICTIONS. The Investor acknowledges that the Common Stock
acquired upon the exercise of this Warrant, if not registered, may have
restrictions upon its resale imposed by state and federal securities laws.
(c) MODIFICATION AND WAIVER. This Warrant and any provisions hereof
may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party against which enforcement of the same is sought.
(d) NOTICES. Any notice, request or other document required or
permitted to be given or delivered to the Investor or the Company shall be
delivered or shall be sent by certified or registered mail, postage prepaid, to
the Investor at its address as shown on the books of the Company or to the
Company at the address set forth in the Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its officers thereunto duly authorized.
Dated: December 29, 2000
VOICE MOBILITY INTERNATIONAL, INC.
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
NOTICE OF EXERCISE
To: Voice Mobility International, Inc.
(1) The undersigned hereby elects to purchase _________________
shares of Common Stock of Voice Mobility International, Inc. pursuant to the
terms of the attached Warrant, and tenders herewith payment of the purchase
price in full, together with all applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing said
shares of Common Stock in the name of the undersigned.
Dated:_____________ [INVESTOR]
By:
---------------------------------
Name:
---------------------------------
Title:
---------------------------------
NOTE: Signature must conform in all respects to holder's name as specified on
the face of the attached warrant.
EXHIBIT C
DEFINITION OF ACCREDITED INVESTOR
ACCREDITED INVESTOR. "Accredited investor" shall mean any person who comes
within any of the following categories, or who the issuer reasonably believes
comes within any of the following categories at the time of the sale of the
securities to that person:
(1) Any bank as defined in section 3(a)(2) of the Securities Act of 1933,
as amended (the "SECURITIES ACT"), or any savings and loan association or other
institution as defined in section 3(a)(5)(A) of the Securities Act whether
acting in its individual or fiduciary capacity; any broker or dealer registered
pursuant to section 15 of the Securities Exchange Act of 1934; any insurance
company as defined in section 2(13) of the Securities Act; any investment
company registered under the Investment Company Act of 1940 or a business
development company as defined in section 2(a)(48) of that Act; Small Business
Investment Company licensed by the U.S. Small Business Administration under
section 301 (c) or (d) of the Small Business Investment Act of 1958; any plan
established and maintained by a state, its political subdivisions, or any agency
or instrumentality of a state or its political subdivisions, for the benefit of
its employees, if such plan has total assets in excess of US$5,000,000; employee
benefit plan within the meaning of the Employee Retirement Income Security Act
of 1974 if the investment decision is made by a plan fiduciary, as defined in
section 3(21) of such Act, which is either a bank, savings and loan association,
insurance company, or registered investment adviser, or if the employee benefit
plan has total assets in excess of US$5,000,000 or, if a self-directed plan,
with investment decisions made solely by persons that are accredited investors;
(2) Any private business development company as defined in section
202(a)(22) of the Investment Advisers Act of 1940;
(3) Any organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purpose of acquiring the securities
offered, with total assets in excess of US$5,000,000;
(4) Any director, executive officer, or general partner of the issuer of
the securities being offered or sold, or any director, executive officer, or
general partner of a general partner of that issuer;
(5) Any natural person whose individual net worth, or joint net worth with
that person's spouse, at the time of his or her purchase exceeds US$1,000,000;
(6) Any natural person who had an individual income in excess of
US$200,000 in each of the two most recent years or joint income with that
person's spouse in excess of US$300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current year;
(7) Any trust, with total assets in excess of US$5,000,000, not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in 230.506(b)(2)(ii); and
(8) Any entity in which all of the equity owners are accredited investors.
EXHIBIT D
FORM OF ESCROW AGREEMENT
ESCROW AGREEMENT
THIS AGREEMENT is made effective as of the 29th day of December, 2000 among
VOICE MOBILITY INTERNATIONAL, INC. ("VMI"), a Nevada corporation, and PAXXVIII
HOLDINGS LTD., MADRONA INVESTMENTS LTD., XXXXXX CONSULTING LTD. and ALLIANCE
EQUITIES LTD. (referred to herein collectively as "Investors") and OB SERVICES,
INC. ("Escrow Agent"), an affiliate of OWEN, BIRD, Barristers and Solicitors.
WITNESSES THAT WHEREAS:
A. Pursuant to subscription agreements (the "Subscription Agreement")
made as of the 29th day of December, 2000, Investors have agreed to purchase
from VMI and VMI has agreed to issue to Investors an aggregate of $2,000,000 of
newly designated Series B Non-Voting Convertible Preferred Stock of the capital
stock of VMI (the "Preferred Stock") and warrants to purchase up to 500,000
shares of Common Stock of VMI at $1.75 per share up to November 30, 2003 (the
"Warrants").
B. Investors have agreed to pay the full amount of the subscription price
for the Preferred Stock (the "Investors' Funds") into Escrow Agent's trust
account, to be held and disbursed in accordance with the terms of this
Agreement.
C. Escrow Agent has agreed to hold and deal with the Investors' Funds in
accordance with this Agreement.
NOW THEREFORE in consideration of the premises, the mutual covenants and
conditions herein, the parties hereto agree as follows:
ARTICLE 1
INTERPRETATION
1.1 DEFINED TERMS. For all purposes of this Agreement, the following terms
have the following meanings, with such meanings to be equally applicable to both
the singular and plural forms of the respective terms:
a) "Business Day" means a day other than Saturday, Sunday or any
statutory holiday in British Columbia.
b) "Escrow Agent" means OB Services Inc. or its successor in the capacity
as escrow agent under this Agreement from time to time.
c) "Escrowed Funds" means the amount of US$1,999,985 in readily payable
funds less any amounts paid out by the Escrow Agent from time to time
pursuant to this Agreement.
d) "Escrowed Documents" means 666,667 shares of Preferred Stock to be
held and dealt with in accordance with the terms of this Agreement.
1.2 ENTIRE AGREEMENT. This Agreement including any exhibits or schedules
hereto and all documents delivered in support hereof sets forth the entire
agreement and understanding between the parties as to the subject matter hereof
and merges and supersedes all prior discussions, agreements and understandings
of every kind and nature.
1.3 GOVERNING LAW. This Agreement and its validity, construction and
performance shall be governed in all respects by the laws of the Province of
British Columbia and all parties hereby irrevocably attorn to the exclusive
jurisdiction of the courts of British Columbia.
1.4 SEVERABILITY. If any provision of this Agreement or the application of
any provision hereof to any person or circumstance is held invalid, the
remainder of this Agreement and the application of such provision to other
persons or circumstances shall not be affected thereby.
1.5 SUCCESSORS AND ASSIGNS. This Agreement and all action taken hereunder
in accordance with the terms hereof shall be binding upon and enure to the
benefit of the parties hereto and their respective successors and assigns.
1.6 COUNTERPARTS/HEADINGS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument. The headings contained
herein are for purposes of reference only and shall not affect nor shall they be
taken into consideration in determining the meaning or interpretation of the
provisions hereof.
1.7 AMENDMENT/WAIVER. This Agreement shall not be changed, modified or
amended except in writing signed by all the parties hereto. No failure or delay
on the part of any party hereto in the exercise of any right hereunder in
enforcing or requiring the compliance or performance by any of the other parties
of any of the terms or conditions of this agreement shall operate as a waiver of
any such right, or constitute a waiver of a breach of any such terms or
conditions, nor shall any single or partial exercise of any such right preclude
other or further exercise thereof or of any other right, nor shall any of the
aforementioned failures or delays affect or impair such rights generally in any
way. The waiver by any party of a breach of any term or condition of this
Agreement by any other party shall not operate as nor shall it be construed as a
waiver of any subsequent breach thereof.
1.8 TIME. Time shall be in all respects of the essence herein.
ARTICLE 2
APPOINTMENT OF ESCROW AGENT AND SUCCESSORS
2.1 PURPOSE OF AGREEMENT. This Agreement and the escrow created herein has
been executed, delivered and established for the purpose of holding and
delivering the Investors' Funds and the Escrowed Documents in accordance with
the terms of the Subscription Agreement.
2.2 APPOINTMENT OF ESCROW AGENT. Investors and VMI hereby appoint Escrow
Agent to act as the escrow agent hereunder and Escrow Agent accepts its
appointment and designation as such pursuant and subject to the terms and
conditions herein.
2.3 SUCCESSORS. Escrow Agent may at any time resign by giving not less
than 10 Business Days prior written notice to each of the other parties hereto,
and shall be discharged of its duties hereunder upon the expiration of the said
10 Business Days or upon the earlier appointment of a successor. In the event of
such resignation, a successor escrow agent will be selected by Investors and VMI
jointly in writing and such successor shall thereupon receive the Certificate
herein and shall succeed to all the rights and duties of Escrow Agent as set
forth herein.
ARTICLE 3
ESCROW ARRANGEMENTS
3.1 DELIVERY OF ESCROWED DOCUMENTS. The Escrow Agent confirms that it has
received from Investors and holds in trust the Escrowed Funds, to be held and
dealt with in accordance with the terms of this Agreement. The Escrow Agent
further confirms that it has received from VMI certificates representing an
aggregate of 666,667 shares of Preferred Stock and holds in trust such
certificates, to be held and dealt with in accordance with the terms of this
Agreement (the "Escrowed Documents").
3.2 NOTICE BY VMI. If at any time VMI delivers to Escrow Agent a statutory
declaration of a director or senior officer of VMI (the "VMI Statutory
Declaration") stating that, pursuant to the Subscription Agreement, VMI is
entitled to be paid a portion of the Escrowed Funds then Escrow Agent will
within a reasonable time deliver a copy of the VMI Statutory Declaration (the
"Investors Copy") to Investors.
3.3 PAYMENT TO VMII. If Escrow Agent has not received from Investors
within 15 Business Days of deemed receipt by Investors of the Investors Copy
(the "Investors Dispute Period") a statutory declaration of a director or senior
officer of one of the Investors stating that VMI is not entitled to have paid to
it the amount specified in the VMI Statutory Declaration (a "Investors Dispute
Notice") then Escrow Agent will, without the need for further consultation with
or authorization from Investors, pay the amount specified in the VMI Statutory
Declaration to the order of VMI; provided that with respect to the first
disbursement of Escrowed Funds currently anticipated to be made on January 15,
2001, the Investors Dispute Period shall be shortened to such period of time
necessary to accomplish such first disbursement on January 15, 2001.
3.4 NON-DELIVERY TO VMI. If Escrow Agent receives a Investors Dispute
Notice within the Investors Dispute Period then Escrow Agent will not pay the
amount specified in the VMI Statutory Declaration to VMI but will continue to
hold the Escrowed Funds until directed in writing by both Investors and VMI or
ordered by a court of competent jurisdiction.
3.5 NOTICE OF NON-ENTITLEMENT BY INVESTORS. If, at any time, Investors
delivers to Escrow Agent a statutory declaration of a director or senior officer
of one of the Investors (the "Investors Statutory Declaration") stating that VMI
is not entitled to have any further amounts paid to it out of the Escrowed Funds
then Escrow Agent will within a reasonable time deliver a copy of the Investors
Statutory Declaration (the "VMI Copy") to VMI.
3.6 DELIVERY TO INVESTORS. If Escrow Agent has not received from VMI
within 15 Business Days of deemed receipt by VMI of the VMI Copy (the "VMI
Dispute Period") a statutory declaration of a director or senior officer of VMI
stating that VMI is entitled to have further amounts paid to it out of the
Escrowed Funds pursuant to the Subscription Agreement (a "VMI Dispute Notice")
then Escrow Agent will, without the need for further consultation with or
authorization from VMI, pay the Escrowed Funds to Investors.
3.7 NON-DELIVERY TO INVESTORS. If Escrow Agent receives a VMI Dispute
Notice within the VMI Dispute Period then Escrow Agent will cease to make any
further payments out of the Escrowed Funds until directed in writing by both
Investors and VMI or ordered by a court of competent jurisdiction.
3.8 DELIVERY OF ESCROWED DOCUMENTS. Concurrent with each disbursement of
Escrowed Funds to VMI, VMI shall instruct the Escrow Agent to release to the
Investors certificates representing such number of shares of Preferred Stock, as
previously deposited into the escrow with the Escrow Agent, to the Investors in
such denominations as directed by VMI, which VMI agrees shall correspond to the
amount of Escrowed Funds so disbursed and in accordance with the terms of the
Subscription Agreement. Upon execution of this Agreement, VMI shall deliver
directly to the Investors (and outside of the escrow) the certificates
representing the number of Warrants to be issued to each Investor pursuant to
the terms of the Subscription Agreement.
3.9 INVESTMENT OF ESCROWED FUNDS. Escrow Agent shall invest the Escrowed
Funds in such investment accounts as directed by a senior officer of VMI.
ARTICLE 4
TERMINATION OF ESCROW
4.1 TERMINATION OF ESCROW. This Agreement and the rights and obligations
of the parties hereto shall terminate when the Escrowed Funds and Escrowed
Documents have been delivered to VMI or returned to Investors in accordance with
the terms of this Agreement.
ARTICLE 5
RIGHTS, DUTIES AND REMUNERATION OF THE ESCROW AGENT
5.1 FEES. VMI and Investors will each indemnify Escrow Agent for its
reasonable fees and expenses for acting as escrow agent hereunder.
5.2 RIGHTS OF ESCROW AGENT. Escrow Agent may act upon any instrument or
other writing or transmission reduced to writing believed by it in good faith to
be genuine and to be signed or presented by the proper person. Escrow Agent
shall not be liable to any of the parties hereto for any liability or losses
sustained by any of them as a result of any action taken or omitted to be taken
by it in good faith unless a court of competent jurisdiction determines that
Escrow Agent's wilful misconduct or gross negligence was the primary cause of
any such loss. Escrow Agent may consult with qualified outside counsel of its
choice at all reasonable times, and shall have full and complete authorization
and protection for any action taken or omitted by it hereunder in good faith and
in accordance with the opinion of such counsel.
5.3 INDEMNITY. The parties hereto agree, jointly and severally, to
indemnify and save harmless Escrow Agent from all costs, expenses (including
legal fees and disbursements on a solicitor and own client basis), liabilities
and losses that may be incurred by it as a result of being named a party to or
responding to any litigation arising from the performance of its duties
hereunder, except such litigation that arises from any act or failure to act by
Escrow Agent that is determined by a court of competent jurisdiction to
constitute wilful misconduct or gross negligence of Escrow Agent.
5.4 NO LIABILITY. The duties and responsibilities of Escrow Agent
hereunder shall be determined solely by the express provisions of this
Agreement, and no other or further duties or responsibilities shall be implied.
Escrow Agent shall not have any liability under, and shall have no duty to
inquire into the terms and provisions of, any other Agreement, or instructions,
other than as set forth or contemplated in this Agreement.
5.5 DIRECTIONS. If Escrow Agent is uncertain as to its duties or rights
hereunder or shall receive instructions, claims or demands from any party hereto
which, in its opinion, conflict with any of the provisions of this Agreement,
Escrow Agent shall be entitled to refrain from taking any action and its sole
obligation shall be to keep safely the Certificate until it shall be directed
otherwise in a written notice satisfactory to Escrow Agent from the other
parties hereto or by a final order or judgment of a court of competent
jurisdiction.
5.6 INTERPLEADER. In the event of a dispute between any of the parties to
this Agreement and where Escrow Agent deems it necessary for its protection to
do so, Escrow Agent may deposit the Certificate into a court of competent
jurisdiction and, subject to any order of such court, shall thereafter have no
further duties in connection therewith to any of the parties hereto.
5.7 DIRECTIONS FROM THE PARTIES. Escrow Agent shall be entitled to rely
upon directions from Xxxxxxx X. Xxxxx or such other individual as he may appoint
in writing as directions from Investors for all purposes hereof. Escrow Agent
shall be entitled to rely upon directions from the Chief Executive Officer, the
President or the Chief Financial Officer, or such other individual(s) as any of
them may appoint in writing as directions from VMI for all purposes hereof.
ARTICLE 6
RELEASE CONDITIONS
6.1 DRAW OF FUNDS. VMI and the Investors hereby agree that, subject to the
conditions precedent set forth in Section 6.2 below, up to $500,000 of the
Escrowed Funds may be paid to VMI on each of January 15, 2001, January 31, 2001,
February 15, 2001 and February 28, 2001 in increments, at the discretion of VMI,
of $100,000. Concurrent with each draw of Escrowed Funds, the Escrow Agent shall
pay to VMI all accrued interest on the amount of the Escrowed Funds so disbursed
to VMI.
6.2 CONDITIONS PRECEDENT OF FIRST DRAW. VMI and the Investors hereby agree
that the first draw on January 15, 2001, shall be subject to the consummation of
the following conditions precedent:
(a) A Budget approved by the Board of Directors of VMI;
(b) A Revenue Forecast approved by the Board of Directors of VMI; and
(c) A Technology Development and Implementation Plan approved by the
Board of Directors of VMI.
Other than the foregoing conditions precedent, VMI and the Investors agree
that no other conditions precedent shall exist with respect to any disbursement
or draw of the Escrowed Funds.
6.3 RETRACTION. VMI hereby agrees with the Investors that in the event
funds are available in excess of VMI's working capital requirements, then VMI
shall at such time such excess funds are available, if any, and prior to June
30, 2001, retract the sale of the Preferred Stock pursuant to the Subscription
Agreement to the extent of such excess funds, by refunding to the Investors the
amount of such excess funds (to a maximum of the amount of the Escrowed Funds
disbursed to VMI) and instructing the Escrow Agent to return to the Investors
the balance of any Escrowed Funds, if any, together with all accrued and unpaid
dividends on such Preferred Stock to the date(s) of such repayment/return of
such amounts. The amount of any accrued interest on the balance of the Escrowed
Funds so returned to the Investors shall be credited towards the amount of
accrued dividends to be paid to Investors by VMI on such Preferred Stock. As
conditions to any such retraction, Investors shall deliver to VMI the number of
shares of Preferred Stock previously issued to Investors in the amount so repaid
by VMI (and at the original price per share issued to Investors), free and clear
of all liens, security interests, claims, pledges and encumbrances of any kind,
together with the share certificates representing such shares of Preferred
Stock, duly endorsed for transfer, whereupon VMI will cancel such shares. Upon
delivery of the balance of such Escrowed Funds to the Investors pursuant to such
a return of funds, VMI shall be entitled to instruct the Escrow Agent to return
to VMI all certificates representing shares of Preferred Stock held by Escrow
Agent and not previously delivered to Investors, whereupon VMI will be entitled
to cancel all such shares. In the event any Investor fails to deliver such
certificates representing such shares, VMI shall be entitled to deposit the
funds with the Escrow Agent under an escrow account for the benefit of such
Investor, and thereafter treat such shares of Preferred Stock as cancelled for
all purposes. Any outstanding shares of Preferred Stock not retracted or
refunded hereunder by June 30, 2001, shall be subject to conversion into Common
Stock to the extent set forth in the Articles of Incorporation, as amended, of
VMI. Any retraction or refund hereunder shall not affect any Warrants issued
under the Subscription Agreement and such Warrants shall remain outstanding
regardless of any retraction or refund.
6.4 OBLIGATIONS OF ESCROW AGENT. The provisions of this Article 6 are
intended to define the rights and obligations of VMI, on the one hand, and the
Investors on the other, and except as set forth in Article 3 hereof, the Escrow
Agent shall have no obligations whatsoever to make any determinations under this
Article 6 and shall follow the instructions of the VMI and the Investors as set
forth in Article 3 hereof.
ARTICLE 7
MISCELLANEOUS
7.1 NOTICES. All notices, requests, demands and other communications
pursuant to this Agreement shall be in writing, addressed to the respective
parties hereto at their addresses referred to below (or to such other address as
any party may advise the other parties of by notice) and shall be deemed to have
been given and received: (i) the next Business Day, if by hand delivery or
overnight courier sent on a Business Day; (ii) three Business Days following
post-paid registered or certified mailing if mailed in Canada or the United
States of America, or (iii) upon written acknowledgement of facsimile
transmission; provided however, that in all cases, all notices, requests,
demands and other communications to Escrow Agent shall be deemed to have been
given and received on the date actually received by Escrow Agent:
To Investors:
-------------------
-------------------
-------------------
ATTENTION:
---------
Facsimile:
---------
To VMI: Voice Mobility International, Inc.
Xxxxx 000
00000 Xxxxxxxx Xxxxxxx
Xxxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0
ATTENTION: CHIEF FINANCIAL OFFICER
Facsimile: (000) 000-0000
With copy to:
Crosby, Heafey, Xxxxx & May, P.C.
1901 Avenue of the Stars, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Facsimile: (000) 000-0000
To Escrow Agent: OB Services Inc.
Xxxxx 0000 - 000 Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X. X0X 0X0
ATTENTION: XXX X. XXXXXXXX
Facsimile: 604.688.2827
7.2 DELIVERY BY FAX. This Agreement may be effectively delivered by any
party hereto by transmitting by facsimile a copy hereof executed by such party
to each of the other parties as provided for herein.
IN WITNESS WHEREOF the parties have executed and delivered this Agreement
as of the date first above written.
VOICE MOBILITY INTERNATIONAL, INC. PAXXVIII HOLDINGS LTD.
Per: Per:
---------------------------------- ---------------------------------
Authorized Signatory Authorized Signatory
MADRONA INVESTMENTS LTD., ALLIANCE EQUITIES LTD.
Per: Per:
---------------------------------- ---------------------------------
Authorized Signatory Authorized Signatory
XXXXXX CONSULTING LTD. OB SERVICES INC.
Per: Per:
---------------------------------- ---------------------------------
Authorized Signatory Authorized Signatory
