Execution Version
PURCHASE AND SUBSCRIPTION AGREEMENT
THIS PURCHASE AND SUBSCRIPTION AGREEMENT, dated as of October
17, 2003 (this "Agreement"), is by and among TalkPoint Communications Inc., a
Delaware corporation (the "Company"), Moneyline Networks, LLC, a Delaware
limited liability company ("MLN"), each party whose name appears on the
signature pages of this Agreement (each an "Investor" and, collectively, the
"Investors") and, with respect to Sections 4(e) and 13 hereof, Moneyline
Telerate Holdings, a Delaware corporation ("MTH").
RECITALS
WHEREAS, MLN beneficially owns 33,289,824 shares (the "MLN
Shares") of common stock, par value $0.01 per share (the "Common Stock") of the
Company, which represents approximately 57% of the aggregate number of
outstanding shares of Common Stock;
WHEREAS, each of the Investors desires to make a cash
investment in the Company in exchange for (i) newly issued shares of Common
Stock (the "Newly Issued Common Stock") and (ii) a note of the Company
convertible into Common Stock substantially in the form attached hereto as
Exhibit A (a "Convertible Note") secured by certain assets of the Company
pursuant to a Security Agreement substantially in the form attached hereto as
Exhibit B (the "Security Agreement"), with the minimum aggregate investment of
the Investors being $1,200,000;
WHEREAS, each of the Investors desires to purchase from MLN,
simultaneously with the purchase of the Newly Issued Common Stock and the
Convertible Note, a number of MLN Shares (the transfer of such MLN Shares
together with the issuance of the Newly Issued Common Stock and the Convertible
Notes, the "Investment Transaction");
WHEREAS, in connection with the Investment Transaction, MLN
and the Company will enter into a distribution and licensing agreement
substantially in the form attached hereto as Exhibit C (the "Distribution
Agreement"), (the "Distribution Transaction" and, together with the Investment
Transaction, the "Transactions");
WHEREAS, in connection with the consummation of the
Transactions, MTH and the Company will terminate the Secured Credit Agreement
(as defined below) and all obligations and agreements related thereto; and
WHEREAS, a special committee of independent directors of the
Board of Directors of the Company has reviewed and evaluated the terms and
conditions of the Transactions and deems the consummation of the Transactions to
be fair to the Company.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and
agreements and the representations and warranties herein contained, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. For purposes of this Agreement:
"Affiliate" or "Affiliates" shall have the meaning
ascribed to such term by Rule 144 promulgated under the Securities Act
of 1933, as amended (the "Securities Act").
"Governmental Authority" means any nation or
government, any state or other political subdivision thereof or court,
arbitral or other tribunal and any entity properly exercising
executive, legislative, judicial, regulatory or administrative
functions of government.
"Lien" means any charge, equitable interest, lien,
encumbrance, claim, option, proxy by way of security, pledge, security
interest, mortgage, right of first refusal, right of preemption,
transfer or retention of title agreement, or restriction by way of
security of any kind or nature, including any restriction on use,
voting, transfer, receipt of income or exercise of any other attribute
of ownership.
"Material Adverse Effect" means, as to any person,
any change event or effect that is materially adverse to (a) the
business, assets, financial condition, operations or results of
operations of such person and its subsidiaries taken as a whole; or (b)
the ability of such person to consummate the transactions contemplated
by this Agreement or perform its obligations with respect thereto;
provided, however, that in no event shall a decline in the market price
of any person's publicly traded securities, in and of itself,
constitute a Material Adverse Effect.
"Requirements of Law" means, as to any person, the
certificates of incorporation and bylaws or other organizational or
governing documents of such person, and all federal, state, local and
foreign laws, rules and regulations, including, without limitation,
securities, antitrust, communications, licensing, health, safety, labor
and trade laws, rules and regulations, and all orders, judgments,
decrees and other determinations of any Governmental Authority or
arbitrator, applicable to or binding upon such person or any of its
property or to which such person or any of its property is subject.
"Transaction Documents" means this Agreement, the
Security Agreement, the Convertible Notes, the Distribution Agreement
and any other documents delivered by a party at the Closing.
"Transfer Agent" means Continental Stock Transfer &
Trust Company, in its capacity as transfer agent for the Common Stock.
2. Consummation of the Investment Transaction. On the
terms and subject to the conditions set forth in this Agreement and in
reliance upon the representations, warranties, covenants and agreements
contained herein, each of the parties hereto shall take all actions
necessary to consummate the Investment Transaction at the Closing (as
defined in Section 4(a)), including, without limitation, the following:
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(a) Purchase and Sale of the Newly Issued Common Stock. The
Company shall issue and sell to each Investor, and each Investor shall
purchase from the Company, the number of shares of Newly Issued Common
Stock specified opposite such Investor's name on Schedule I hereto.
(b) Purchase and Issuance of the Convertible Notes. The
Company shall issue and sell to each Investor, and each Investor shall
purchase from the Company, a Convertible Note in the principal amount
specified opposite such Investor's name on Schedule I hereto.
(c) Purchase Price for Securities; Allocation of Purchase
Price for Newly Issued Common Stock and Convertible Notes. The Company
shall issue the Newly Issued Common Stock and the Convertible Notes in
exchange for payment to the Company of the applicable purchase price as
indicated in Schedule I hereto. The total purchase price payable by
each Investor (as reflected on Schedule I hereto) shall be allocated
75% and 25% to the Newly Issued Common Stock and the Convertible Notes,
respectively.
(d) Purchase and Sale of the MLN Shares. MLN shall sell to
each Investor, and each Investor shall purchase from MLN, the number of
MLN Shares specified opposite such Investor's name on Schedule I hereto
in exchange for an aggregate purchase price of $1.00 to be paid by each
Investor to MLN.
3. Consummation of the Distribution Transaction. On the terms and
subject to the conditions set forth in this Agreement and in reliance upon the
representations, warranties, covenants and agreements contained herein, MLN and
the Company shall execute and deliver the Distribution Agreement to each other.
4. Closing.
(a) Closing. The closing of the Investment Transaction (the
"Closing") will take place at the offices of Xxxxxx & Xxxxxxx LLP, 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 on the date hereof (the "Closing
Date").
(b) Deliveries by the Company. At the Closing or promptly
thereafter, the Company shall deliver: (i) to the Transfer Agent
instructions, together with any required legal opinions, to issue
certificates registered in the name of each of the Investors,
representing the shares of Newly Issued Common Stock purchased by such
Investor and bearing the legends required pursuant to Section 16(p)
hereof, (ii) to each Investor, a duly executed Convertible Note in the
principal amount set forth in Schedule I for such Investor and a duly
executed copy of this Agreement and the Security Agreement and (iii) to
MLN, (A) a duly executed copy of this Agreement and the Distribution
Agreement and (B) $1.00, which represents consideration for the
cancellation of outstanding warrants pursuant to Section 14 hereof and
(iv) to MTH, a duly executed copy of this Agreement.
(c) Deliveries by MLN. At the Closing or promptly
thereafter, MLN shall (i) surrender to the Transfer Agent certificates
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representing its shares of Common Stock to be acquired by the Investors
as contemplated by Section 2(d) hereof, such certificates to be
accompanied by stock powers duly executed in blank by MLN with such
other agreements and instruments as the Transfer Agent may require to
effect the transfer of such securities, (ii) deliver to the Transfer
Agent instructions, together with any required legal opinions, to issue
certificates representing shares of Common Stock to be acquired by the
Investors pursuant to Section 2(d) to each of the Investors, and
bearing the legends required pursuant to Section 16(p) hereof, and
(iii) deliver a duly executed copy of this Agreement and the
Distribution Agreement to the Company and a duly executed copy of this
Agreement to the Investors.
(d) Deliveries by the Investor. At the Closing, each
Investor shall deliver (i) to the Company, by wire transfer of
immediately available funds to an account maintained at a commercial
bank located in the United States and designated by the Company, or by
such other method as the Company and such Investor shall mutually agree
, an amount equal to the purchase price specified opposite such
Investor's name on Schedule I hereto, (ii) to MLN, $1.00, which
represents the purchase price for the MLN Shares purchased by such
Investor, and (iii) to each of the Company and MLN, a duly executed
copy of this Agreement and the Security Agreement.
(e) Deliveries by MTH. At the Closing, MTH shall deliver a
duly executed copy of this Agreement to the Company and the Investors.
5. Representations and Warranties of the Company. The Company
hereby represents and warrants to MLN and each Investor as follows:
(a) Organization. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware. The Company has corporate power and authority to
enter into this Agreement and the other Transaction Documents to which
it is a party, to issue the Newly Issued Common Stock and the
Convertible Notes, to perform its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby.
(b) Authority. The execution and delivery of this
Agreement and the other Transaction Documents to which it is a party,
the issuance of the Convertible Notes by the Company, and the
performance by the Company of its obligations hereunder and thereunder
have been duly authorized by all requisite corporate action by the
Company, and no other corporate or other proceeding is necessary for
the execution and delivery of this Agreement or the other Transaction
Documents to which it is a party, the issuance of the Convertible
Notes, the performance by the Company of its obligations hereunder and
thereunder and the consummation by the Company of the transactions
contemplated hereby and thereby. This Agreement and the other
Transaction Documents to which it is a party have been duly and validly
executed and delivered by the Company, and, upon the execution and
delivery by the other parties hereto and thereto, will constitute the
legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except to the
extent that such validly binding effect and enforceability may be
limited by applicable bankruptcy, reorganization, insolvency,
moratorium and other laws affecting creditors' rights generally.
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(c) Capitalization. The Newly Issued Common Stock has been
duly authorized and, when issued in accordance with this Agreement, will
be validly issued, fully paid and nonassessable. The MLN Shares have
been duly authorized and validly issued and are fully paid and
nonassessable. The Common Stock issuable upon conversion of each
Convertible Note has been duly authorized and, when issued in accordance
with the terms of such Convertible Note, will be validly issued, fully
paid and nonassessable.
(d) Non-Contravention; Consents.
(i) Neither the execution and delivery by the
Company of, nor the consummation or performance by the Company
of any of the transactions to be consummated or performed by
it under, this Agreement or the other Transaction Documents to
which it is a party will directly or indirectly (with or
without notice or lapse of time): (A) violate any provision of
the Company's Certificate of Incorporation or Bylaws, (B)
constitute or result in a breach or default by the Company or
any of its subsidiaries, or give rise to a right of
termination, amendment, cancellation or acceleration on the
part of any other party, or result in the creation or
imposition of any Lien on the Company's assets (except as
provided in the Security Agreement), under any agreement
or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries
is bound, which breach, default, termination or Lien would
have a Material Adverse Effect on the Company, or (C)
constitute a violation by the Company or any of its
subsidiaries of any Requirements of Law that would have a
Material Adverse Effect on the Company.
(ii) No consent, approval, order or authorization of,
or registration, qualification, designation, declaration or
filing with, any Governmental Authority or other person on
the part of the Company or any of its subsidiaries is required
in connection with the execution, delivery and performance
by the Company of this Agreement or the other Transaction
Documents to which it is a party or the consummation of the
transactions contemplated hereby or thereby, except for the
consents of MLN provided herein, filings required under
federal or states securities laws to effect a Rule 506 or
similar exemption under the Securities Act and such other
consents, approvals, orders, authorizations, registrations,
qualifications, designations, declarations or filings the
failure of which to have or to make would not have a Material
Adverse Effect on the Company.
(e) SEC Filings. Since October 16, 2002, the Company has
properly filed all forms, schedules, reports, prospectuses, proxy
statements and documents required to be filed by the Company with the
Securities and Exchange Commission (the "TalkPoint SEC Reports"). The
TalkPoint SEC Reports (i) at the time they were filed, complied in
all material respects with the requirements of the Securities Act or
the Securities Exchange Act of 1934, as amended, as the case may be,
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and the rules and regulations promulgated thereunder, and (ii) did
not at the time they were filed (or if amended or superseded by the
filing prior to the date of this Agreement, then on the date of such
filing) contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading. The Company makes no
representation or warranty whatsoever concerning the TalkPoint SEC
Reports as of any time other than the time they were filed.
(f) Relationship with MLN. The Company has no material
agreements with MLN other than this Agreement, the Distribution
Agreement, the Stock Purchase Agreement, dated May 16, 2002, by and
among MLN, B2BVideo Network Corp. ("B2B") and the Company, the
Strategic Alliance Agreement, dated as of May 16, 2002, by and among
MLN, B2B and the Company, the two Technology License Agreements entered
into in connection therewith, and the Guarantee by Moneyline Telerate,
an affiliate of MLN, in connection with the Agreement of Lease, dated
as of July 7, 1999, between the Company and WU/Lighthouse 100 Xxxxxxx,
L.L.C., as amended. The Company has no outstanding indebtedness owed to
MLN.
EXCEPT AS SPECIFICALLY SET FORTH IN THIS SECTION 5 OR THE
OTHER TRANSACTION DOCUMENTS, THE COMPANY IS NOT MAKING ANY REPRESENTATIONS AND
WARRANTIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, TO MLN OR ANY INVESTOR WITH
RESPECT TO THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS.
6. Representations and Warranties of MLN. MLN hereby represents
and warrants to the Company and each Investor as follows:
(a) Organization. MLN is a limited liability company duly
organized, validly existing and in good standing under the laws of the
State of Delaware. MLN has the requisite limited liability company
power and authority to enter into this Agreement and the other
Transaction Documents to which it is a party, to perform its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby.
(b) Authority. The execution and delivery of this
Agreement and the other Transaction Documents to which it is a party
by MLN, and the performance by MLN of its obligations hereunder and
thereunder have been duly authorized by all necessary limited liability
company action by MLN, and no other proceeding is necessary for the
execution and delivery of this Agreement or the other Transaction
Documents to which it is a party, the performance by MLN of its
obligations hereunder and thereunder and the consummation by MLN of the
transactions contemplated hereby and thereby. This Agreement and the
other Transaction Documents to which it is a party have been duly and
validly executed and delivered by MLN, and upon the execution and
delivery by the other parties hereto and thereto, will constitute
the legal, valid and binding obligations of MLN, enforceable against
MLN in accordance with its terms, except to the extent that such
validly binding effect and enforceability may be limited by applicable
bankruptcy, reorganization, insolvency, moratorium and other laws
affecting creditors' rights generally. The MLN Shares have been duly
authorized and validly issued and are fully paid and nonassessable.
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(c) Non-Contravention; Consents.
(i) Neither the execution and delivery by MLN of,
nor the consummation or performance by MLN of any of the
transactions to be consummated or performed by it under, this
Agreement or the other Transaction Documents to which it is
a party will directly or indirectly (with or without notice or
lapse of time): (A) violate any provision of MLN's Certificate
of Formation, Limited Liability Company Agreement or other
similar organizational documents (B) constitute or result in
a breach or default by MLN, or give rise to a right of
termination, amendment, cancellation or acceleration on the
part of any other party, or result in the creation or
imposition of any Lien on MLN's assets, under any agreement or
instrument to which MLN is a party or by which MLN is bound,
which breach, default, termination or Lien would have a
Material Adverse Effect on MLN, or (C) constitute a
violation by MLN of any Requirements of Law that would have a
Material Adverse Effect on MLN.
(ii) No consent, approval, order or authorization of
, or registration, qualification, designation, declaration or
filing with, any Governmental Authority or other person on the
part of MLN is required in connection with the execution,
delivery and performance by MLN of this Agreement or the other
Transaction Documents to which it is a party or the
consummation of the transactions contemplated hereby or
thereby, except for the consents of MLN provided herein and
such other consents, approvals, orders, authorizations,
registrations, qualifications, designations, declarations or
filings the failure of which to have or to make would not have
a Material Adverse Effect on MLN.
(d) MLN Shares. MLN is the record holder of the MLN Shares
being transferred to the Investors, which shares are free and clear of
any Liens. MLN is not bound with respect to the MLN Shares being
transferred by (i) any subscription, option or other agreement pursuant
to which MLN is or may become obligated to sell such shares or (ii) any
voting or similar agreements other than the Stockholders Agreement that
is being terminated pursuant to Section 16(a)(iii) hereof.
EXCEPT AS SPECIFICALLY SET FORTH IN THIS SECTION 6 OR THE
OTHER TRANSACTION DOCUMENTS, MLN IS NOT MAKING ANY REPRESENTATIONS AND
WARRANTIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, TO THE COMPANY OR ANY INVESTOR
WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS.
7. Representations and Warranties of the Investor. Each Investor
represents and warrants to MLN and the Company as follows:
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(a) Organization. Such Investor, if not a natural person,
is an entity duly organized, validly existing and in good standing
under the laws of the state of its jurisdiction of organization.
(b) Authority. Such Investor has full power and authority
to enter into this Agreement and the other Transaction Documents to
which it is a party, to perform its obligations hereunder and
thereunder and to consummate the transactions contemplated hereby and
thereby. Such Investor that is a natural person has the requisite
capacity to execute and deliver this Agreement and the other
Transaction Documents to which it is a party, to perform its
obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. This Agreement and the
other Transaction Documents to which it is a party have been duly and
validly executed and delivered by such Investor and, upon execution
and delivery by the other parties hereto and thereto, will constitute
the legal, valid and binding obligations of such Investor, enforceable
against such Investor in accordance with their terms, except to the
extent that such validly binding effect and enforceability may be
limited by applicable bankruptcy, reorganization, insolvency,
moratorium and other laws affecting creditors' rights generally.
(c) Non-Contravention; Consents.
(i) Neither the execution and delivery by such
Investor of, nor the consummation or performance by such
Investor of any of the transactions to be consummated or
performed by it under, this Agreement or the other Transaction
Documents to which it is a party will directly or indirectly
(with or without notice or lapse of time): (A) violate any
provision of such Investor's organizational or other governing
documents, (B) constitute or result in a breach or default by
such Investor or any of its subsidiaries, or give rise to a
right of termination, amendment, cancellation or acceleration
on the part of any other party, or result in the creation or
imposition of any Lien on such Investor's assets, under
any agreement or instrument to which such Investor or any of
its subsidiaries is a party or by which such Investor or any
of its subsidiaries is bound, which breach, default,
termination or Lien would have a Material Adverse Effect on
such Investor, or (C) constitute a violation by such Investor
or any of its subsidiaries of any Requirements of Law that
would have a Material Adverse Effect on such Investor.
(ii) No consent, approval, order or authorization of,
or registration, qualification, designation, declaration or
filing with, any Governmental Authority or other person on the
part of such Investor or any of its subsidiaries is required
in connection with the execution, delivery and performance by
such Investor of this Agreement or the other Transaction
Documents to which it is a party or the consummation of the
transactions contemplated hereby and thereby, except for the
consents of MLN provided herein and such other consents,
approvals, orders, authorizations, registrations,
qualifications, designations, declarations or filings the
failure of which to have or to make would not have a Material
Adverse Effect on such Investor.
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(d) Investment Intention; No Resales. Such Investor
understands that the Newly Issued Common Stock and the MLN Shares
(together, the "Purchased Securities") being purchased by it hereunder
are "restricted securities" (as defined under Rule 144 under the
Securities Act) and have not been registered under the Securities Act
or any applicable state securities law, and such Investor is acquiring
the Purchased Securities for the purpose of investment and for its own
account and not with a view to, or for resale in connection with, the
distribution thereof.
(e) Purchased Securities Unregistered; Accredited
Investor. Such Investor has been advised that (i) the offer and sale of
the Purchased Securities has not been registered under the Securities
Act and (ii) the Purchased Securities being purchased by such Investor
hereunder may need to be held indefinitely. Such Investor represents
and warrants that (i) such Investor is an "Accredited Investor" under
Rule 501(a) of the Securities Act; (ii) such Investor's knowledge and
experience in financial and business matters are such that such
Investor is capable of evaluating the merits and risks of its
investment in such Purchased Securities, or such Investor has been
advised by a representative possessing such knowledge and experience;
(iii) such Investor and such Investor's representatives, including such
Investor's professional, financial, tax and other advisors, if any,
have carefully considered the proposed investment by such Investor in
the Purchased Securities, and such Investor understands and has
taken cognizance of (or has been advised by its representatives as to)
the risk factors related to the acquisition of such Purchased
Securities, and no representations or warranties (oral or written)
have been made to such Investor or its representatives concerning the
Purchased Securities, the Company or the Company's business,
operations, financial condition or prospects or other matters except
as expressly set forth herein; (iv) in making its decision to purchase
the Purchased Securities being purchased by it hereunder, such Investor
has relied upon independent investigations made by such Investor and,
to the extent believed by such Investor to be appropriate, such
Investor's representatives, including such Investor's professional,
financial, tax and other advisors, if any; (v) such Investor and its
representatives have been given the opportunity to request to examine
all documents of, and to ask questions of, and to receive answers from,
the Company and its representatives concerning the Company (including
without limitation, its prospects, intended use of proceeds, financial
condition, results of operations and matters pertaining to the grand
jury investigation conducted by the U.S. Department of Justice, as
described in the Company's Quarterly Report on Form 10-Q for the period
ended June 30, 2003) and the terms and conditions of the acquisition of
the Purchased Securities being purchased by such Investor hereunder and
to obtain any additional information which such Investor or its
representatives deem necessary; (vi) such Investor can sustain without
adverse consequence a loss of its entire investment made hereby; (vii)
such Investor is not acquiring the Purchased Securities as a result of
or subsequent to any advertisement, article, notice or other
communication published, or broadcast in any newspaper, magazine, radio
, television, internet or other media of any type whatsoever, or
presented at any seminar or meeting; (viii) such Investor is not a
non-resident alien for federal income tax purposes or a foreign
corporation, foreign trust, foreign estate or foreign company, as such
terms are used in the Internal Revenue Code of 1986 as amended and the
regulations and interpretations thereunder; (ix) such Investor
acknowledges that the Company is entering into this Agreement in
reliance upon such Investor's representations and warranties herein;
and (x) such Investor has not relied on any representations or
warranties of MLN or its representatives, oral or written, express or
implied, other than those representations and warranties expressly
made by MLN in Section 6 hereof.
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(f) Brokers. No person is entitled to any broker's,
finder's, financial adviser's or other similar fee or commission from
such Investor in connection with the transactions contemplated hereby.
EXCEPT AS SPECIFICALLY SET FORTH IN THIS SECTION 7 OR THE
OTHER TRANSACTION DOCUMENTS, SUCH INVESTOR IS NOT MAKING ANY REPRESENTATIONS AND
WARRANTIES, ORAL OR WRITTEN, EXPRESS OR IMPLIED, TO MLN OR THE COMPANY WITH
RESPECT TO THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS.
8. Right of First Offer for Common Stock. Subject to the terms and
conditions specified in this Section 8, the Company hereby grants to each of (i)
MLN and (ii) the Investors that own beneficially more than ten (10%) percent of
the Common Stock, as determined in accordance with Rule 13d-3 promulgated under
the Securities Exchange Act of 1934, as amended, after taking into account the
effect of the consummation of the Investment Transaction (the "Significant
Investors"), a right of first offer with respect to future issuances by the
Company of its Common Stock or any other instruments convertible into or
exercisable for Common Stock (collectively, the "Covered Shares") solely for
cash. Each of MLN and the Significant Investors may designate as purchasers
under such right itself or its partners, members or affiliates in such
proportions as it deems appropriate.
Each time the Company proposes to offer any Covered Shares,
the Company shall first make an offering of such Covered Shares to each of MLN
and the Significant Investors in accordance with the following provisions:
(a) The Company shall deliver a notice (the "Notice") to each of
MLN and the Significant Investors stating (i) its bona fide
intention to offer such Covered Shares, (ii) the number of
such Covered Shares to be offered, and (iii) the price and
terms, if any, upon which it proposes to offer such Covered
Shares. Within 15 days after receipt of the Notice, each of
MLN and the Significant Investors may elect to purchase or
obtain, at the price and on the terms specified in the Notice,
all or any number of the Covered Shares.
(b) The Company may, during the 60-day period following the
expiration of the period provided in Section 8(a) hereof,
offer the remaining unsubscribed portion of the Covered Shares
to any person or persons at a price not less than and upon
terms no more favorable to the offeree than those specified in
the Notice. If the Company does not enter into an agreement
for the sale of the Covered Shares within such period, or if
such agreement is not consummated within 60 days of the
execution thereof, the right provided hereunder shall be
deemed to be revived and such Covered Shares shall not be
offered unless first reoffered to each of MLN and the
Significant Investors in accordance herewith.
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(c) Notwithstanding any of the foregoing, the provisions of
this Section 8 shall (i) terminate on the earlier to occur of
(A) the third anniversary of the date hereof or (B) with
respect to MLN or any of the Significant Investors individually
, on the date such party ceases to own beneficially more than
ten (10%) percent of the Common Stock, as determined in
accordance with Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended (provided that a termination
event arising under this clause (B) with respect to a party
individually shall not affect the rights of the other parties
hereunder), (ii) not apply to (A) any public offering of
Covered Shares (including the exercise or conversion of any
warrants, options or other rights to acquire Covered Shares
issued in such public offering), (B) warrants, options or other
rights to acquire Covered Shares outstanding as of the date
hereof (including such rights granted pursuant to the
Convertible Notes), (C) issuances of any Covered Shares to
employees, directors, consultants or other agents of the
Company or its Affiliates, and (D) Common Stock issued pursuant
to a conversion or exchange of Covered Shares and (iii) only
entitle each of MLN and the Significant Investors to maintain
up to its Percentage Interest (as defined) in effect
immediately prior to the giving of the Notice. The term
"Percentage Interest" shall mean the quotient obtained by
dividing the number of shares of Common Stock (without giving
effect to options, warrants or other rights to acquire Common
Stock) owned by MLN or the applicable Investor, as applicable,
immediately prior to the date of the Notice divided by the
number of shares of Common Stock outstanding (without giving
effect to any treasury shares) immediately prior to the date of
the Notice.
9. Restriction on Transfer of Common Stock.
(a) MLN hereby agrees that it shall not, for a
period of one (1) year after the date hereof, offer to sell
any Common Stock pursuant to a registered public offering or
in open market transactions; it being understood that nothing
in this Section 9 shall limit the ability of MLN to sell any
or all of the Common Stock owned by it pursuant to a private
placement.
(b) Each of the Investors hereby agrees that it
shall not, for a period of one (1) year after the date hereof,
offer to sell any of the Purchased Securities pursuant to a
registered public offering or in open market transactions; it
being understood that nothing in this Section 9 shall limit
the ability of any of the Investors to sell any or all of the
Purchased Securities owned by it pursuant to a private
placement.
(c) Each of MLN and the Investors hereby
consents to the submission of a stop transfer order to the
Transfer Agent to give effect to this Section 9.
10. Conditions to the Investor's Obligations. The obligation
of the Investors to purchase the Purchased Securities and the Convertible Notes
is subject to the representations and warranties of the Company and MLN
contained in Section 5 and Section 6, respectively, being true and correct as of
the Closing Date, which condition may be waived by the Investors, and the
delivery by the parties hereto of the Transaction Documents as specified in
Section 4.
11. Conditions to MLN's Obligations. The obligation of MLN
to sell any of the MLN Shares is subject to (i) the representations and
11
warranties of the Company and the Investors contained in Section 5 and Section
7, respectively, being true and correct as of the Closing Date, which condition
may be waived by MLN, (ii) the delivery by the parties hereto of the Transaction
Documents as specified in Section 4 and (iii) the receipt by the Company of
funds from the Investors in a minimum aggregate amount of $1,200,000.
12. Conditions to the Company's Obligations. The obligation
of the Company to issue and sell the Newly Issued Common Stock or the
Convertible Notes is subject to (i) the representations and warranties of MLN
and the Investors contained in Section 6 and Section 7, respectively, being true
and correct as of the Closing Date, which condition may be waived by the Company
, (ii) the delivery by the parties hereto of the Transaction Documents as
specified in Section 4 and (iii) the receipt by the Company of funds from the
Investors in a minimum aggregate amount of $1,200,000.
13. Termination of Secured Credit Agreement. Pursuant to
Section 6.4 of that certain Secured Credit Agreement, dated as of August 12,
2003 (the "Secured Credit Agreement"), by and between MTH and the Company, MTH
and the Company hereby agree that the Secured Credit Agreement, the related
Security Agreement, dated as of August 12, 2003 (the "MTH Security Agreement"),
by and between MTH and the Company, and all obligations and agreements related
thereto shall terminate upon the consummation of the Transactions, provided that
the Company shall repay MTH in full the aggregate principal amount of all Loans
(as defined in the Secured Credit Agreement) outstanding and all accrued and
unpaid interest thereon, if any, at the Closing. The security interests granted
to MTH under the MTH Security Agreement shall terminate pursuant to Section 10
thereof when all Loans have been fully and indefeasibly repaid to MTH. MTH
acknowledges that no amounts are owed to it under this facility.
14. Cancellation of Warrants. MLN hereby (i) agrees that all
outstanding warrants relating to the Common Stock of the Company registered in
its name shall be cancelled and all obligations with respect thereto shall be
terminated upon the consummation of the Investment Transaction in exchange for
consideration of $1.00 to be delivered by the Company and to deliver such
warrants and such other documents as the Company reasonably requests to effect
such cancellation and termination, (ii) represents and warrants to the Company
that all of such warrants hereof are identified on Schedule II annexed hereto
and that such party has sole record and beneficial ownership of such warrants
and (iii) represents and warrants to the Company that it has not, during the one
year preceding the date hereof, sold, assigned or transferred any warrants or
other rights to acquire Common Stock to any person other than those identified
on Schedule II hereto.
15. Indemnification of Directors and Officers.
(a) The Company shall maintain and perform its
obligations under its existing indemnification and exculpation
provisions with respect to present and former directors and
officers of the Company for all losses, claims, damages,
expenses or liabilities arising out of actions or omissions or
alleged actions or omissions occurring at or prior to the date
hereof to the extent permitted or required under applicable
law and the Company's Certificate of Incorporation and Bylaws
in effect as of the date of this Agreement (to the extent
consistent with applicable law), for a period of not less than
six years after the Closing.
12
(b) On the date hereof, the Company shall obtain run-off
directors' and officers' liability insurance covering the
current and former officers, directors and employees of the
Company and its subsidiaries who are currently covered by the
Company's existing directors' and officers' liability
insurance, on terms and conditions no less favorable in any
material respect to such directors and officers than those in
effect on the date of this Agreement, and shall maintain such
insurance for a period of not less than six years; provided
that the cost of such insurance shall be paid by MLN.
16. Miscellaneous.
(a) MLN Waiver of Preemptive Rights; Consent to Issuance
of Newly Issued Common Stock and Revision of Bylaws;
Termination of Stockholders Agreement.
(i) MLN hereby waives its preemptive rights,
granted pursuant to Section 3.1 of that certain Stockholders
Agreement, dated as of May 16, 2002 (the "Stockholders
Agreement"), by and among MLN, the Company and the Management
Stockholders party thereto, with regard to the issuance and
sale of the Newly Issued Common Stock to the Investors as
contemplated in this Agreement.
(ii) MLN hereby consents, as required by Section
4.1 of the Stockholders Agreement, to (A) the issuance of the
Newly Issued Common Stock, (B) the revision of the Bylaws of
the Company by the Board of Directors of the Company to effect
any and all amendments thereto, and (C) the consummation of
the transactions provided for herein and contemplated hereby.
(iii) MLN and the Company hereby agree, and the
Investors acknowledge, that the Stockholders Agreement and all
obligations of any parties thereto shall terminate
simultaneously with the consummation of the Transactions.
(b) Further Assurances. From time to time,
at the other party's request and without further consideration, each party
hereto shall execute and deliver such additional documents and take all such
further action as may be necessary or desirable to consummate the transactions
contemplated by this Agreement.
(c) Blue Sky. The parties hereto agree to use their
reasonable efforts to comply at the Company's expense with all state securities
and "blue sky" laws which might be applicable to the sale of the Purchased
Securities to the Investor; provided, however, that nothing herein shall require
the company to qualify as a foreign corporation in any jurisdiction or subject
it generally to taxation or to general service of process in any jurisdiction.
(d) Survival of Representations and Warranties. The
representations and warranties of each party hereto contained in this Agreement
13
shall survive for one year following the Closing Date and then terminate and
expire with respect to any theretofore unasserted claims arising out of any
breach or inaccuracy thereof.
(e) Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties named herein and their
respective successors and permitted assigns. Notwithstanding the preceding
sentence, neither MLN nor the Company may assign either this Agreement or any of
its rights, interests or obligations hereunder without the prior written
approval of each Investor; provided, however, that the obligations of MLN
and the Investors pursuant to Section 9 hereof shall be binding upon all
transferees of (i) the Common Stock held by MLN after the consummation of the
Investment Transaction and the Purchased Securities, as applicable, and (ii) the
Convertible Notes.
(f) Severability. The invalidity, illegality or
unenforceability of one or more of the provisions of this Agreement in any
jurisdiction shall not affect the validity, legality or enforceability of the
remainder of this Agreement in such jurisdiction or the validity, legality or
enforceability of this Agreement, including any such provision, in any other
jurisdiction, it being intended that all rights and obligations of the parties
hereunder shall be enforceable to the fullest extent permitted by law.
(g) Amendment. This Agreement may be amended, modified
or supplemented only by a written instrument executed by or on behalf of each of
the parties hereto.
(h) Waiver. Any party hereto may, with respect to
any other party hereto, (i) extend the time for the performance of any
obligations or other acts, (ii) waive any inaccuracies in the representations
and warranties contained herein or in any document delivered hereto or (iii)
waive compliance with any of the agreements or conditions contained herein.
Any such extension or waiver shall be valid if set forth in writing signed by
the party or parties to be bound thereby. No failure or delay on the part of
any party hereto in the exercise of any right hereunder shall impair such right
or be construed to be a waiver of, or acquiescence in, any breach of any
representation, warranty or agreement herein, nor shall any single or partial
exercise of any such right preclude other or further exercise thereof or of
any other right. All rights and remedies under this Agreement are cumulative
to, and not exclusive of, any rights or remedies otherwise available.
(i) Entire Agreement. This Agreement supersedes all
prior discussions, understandings and agreements between the parties with
respect to the subject matter hereof and this Agreement contains the sole and
entire agreement between the parties to this Agreement with respect to the
subject matter hereof. Schedule I and Schedule II to this Agreement are
incorporated into and form an integral part of this Agreement.
(j) No Third Party Beneficiaries. The terms and
provisions of this Agreement are intended solely for the benefit of each party
14
hereto and their respective successors and assigns, and it is not the intention
of the parties to confer, and no provision hereof shall confer, third party
beneficiary rights upon any other person.
(k) Expenses. Each party hereto agrees to bear its own
expenses in connection with this Agreement; provided, however, that the Company
agrees to pay the expenses of the Investors represented by Xxxxxxxx Xxxxxx up to
an aggregate amount equal to $10,000 (inclusive of payment of reasonable out-of-
pocket expenses).
(l) Headings. The headings used in this Agreement have
been inserted for convenience of reference only and do not define or limit the
provisions hereof.
(m) Governing Law. All questions concerning the
construction, validity and interpretation of this Agreement and the exhibits
hereto will be governed by and construed in accordance with the domestic laws of
the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdiction) that would cause the application of the laws of any jurisdiction
other than the State of New York.
(n) Remedies. In the event of a breach by any party
to this Agreement of its obligations under this Agreement, any party
injured by such breach, in addition to being entitled to exercise all rights
granted by law, including recovery of damages and costs (including reasonable
attorneys' fees), will be entitled to specific performance of its rights
under this Agreement. The parties agree that the provisions of this Agreement
shall be specifically enforceable, it being agreed by the parties that the
remedy at law, including monetary damages, for breach of any such provision
will be inadequate compensation for any loss and that any defense in any action
for specific performance that a remedy at law would be adequate is waived.
Notwithstanding any of the foregoing, the parties hereto expressly waive and
forego any right to recover any lost profits, exemplary, consequential,
incidental, special, punitive or similar damages in any arbitration, lawsuit,
litigation or proceeding arising out of or resulting from any controversy
or claim arising out of or relating to this Agreement or the acquisition of the
Purchased Securities.
(o) Counterparts. This Agreement may be executed in any
number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
(p) Securities Act.
(i) Each certificate representing the Purchased
Securities and the certificate representing the MLN Shares
held by MLN after the consummation of the Investment
Transaction shall be endorsed with the following legends and
such other legends as may be required by law or as counsel for
the Company reasonably deems appropriate:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO THE PURCHASE AND SUBSCRIPTION AGREEMENT,
15
DATED AS OF OCTOBER 17, 2003, AS SUCH AGREEMENT MAY
BE AMENDED, RESTATED OR MODIFIED FROM TIME TO TIME,
AND MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT IN
ACCORDANCE WITH THE PROVISIONS THEREOF AND ANY
TRANSFEREE OF THESE SECURITIES SHALL BE SUBJECT TO
THE TERMS OF SUCH AGREEMENT. COPIES OF THE FOREGOING
AGREEMENT ARE MAINTAINED WITH THE CORPORATE RECORDS
OF THE ISSUER AND ARE AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICES OF THE ISSUER."
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT
BE OFFERED, SOLD OR TRANSFERRED EXCEPT PURSUANT TO
(I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE
WITH APPLICABLE STATE SECURITIES LAWS OR (II) AN
APPLICABLE EXEMPTION FROM REGISTRATION THEREUNDER OR
UNDER APPLICABLE STATE SECURITIES LAWS, AND, IF AN
EXEMPTION SHALL BE APPLICABLE, THE HOLDER OF THIS
CERTIFICATE SHALL HAVE DELIVERED AN OPINION OF
COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED."
(ii) Any certificate issued at any time in
exchange or substitution for any certificate bearing such legends
(except a new certificate issued upon the completion of a transfer
pursuant to a registered public offering under the Securities Act and
made in accordance with the Securities Act) shall also bear such
legends, unless in the opinion of counsel for the Company, the
Purchased Securities represented thereby are no longer subject to the
provisions of this Agreement or the restrictions imposed under the
Securities Act or state securities laws, in which case the applicable
legend (or legends) may be removed.
(q) Notices. All notices, requests and other
communications hereunder must be in writing and will be deemed to have been duly
given only if delivered personally against written receipt or by facsimile
transmission or mailed (by registered or certified mail, return receipt
requested) or by reputable overnight courier, fee prepaid to the parties at the
following addresses or facsimile numbers:
(i) If to the Investors, at the addresses set forth
on the signature pages hereto.
16
with copies to:
Xxxxxxxx Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000 0000
Attention: Xxxxx Xxxxxx
(ii) If to MLN or MTH:
Moneyline Networks, LLC
c/o Moneyline Telerate Holdings
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
with copies to
Xxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: R. Xxx Xxxxxxxxx
Xxxxx X. Xxxxxxxx
(ii) If to the Company:
TalkPoint Communications Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
with copies to
Xxxxxxxx Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxx & Xxxxx PC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxxx
All such notices, requests and other communications will (w)
if delivered personally to the address as provided in this Section 16(q) be
deemed given upon delivery, (x) if delivered by facsimile transmission to the
facsimile number as provided in this Section 16(q) be deemed given upon receipt,
(y) if delivered by mail in the manner described above to the address as
provided in this Section 16(q), be deemed given upon receipt and (z) if
delivered by reputable overnight courier to the address as provided in this
Section 16(q), be deemed given upon receipt. Any party from time to time may
change its address, facsimile number or other information for the purpose of
notices to that party by giving notice specifying such change to the other
parties hereto.
17
(r) Appointment of Collateral Agent. The Investors
hereby appoint Xxxxxxx Xxxxxxx, Esq. to serve as collateral agent with
respect to the Security Agreement and hereby grant and delegate to such
person the powers, rights, duties and obligations, as more fully set
forth in the Security Agreement.
(s) Consent to Jurisdiction and Service of Process.
EACH OF THE PARTIES HERETO CONSENTS TO THE EXCLUSIVE JURISDICTION OF
ANY STATE OR FEDERAL COURT LOCATED WITHIN THE STATE OF NEW YORK AND
IRREVOCABLY AGREES THAT ALL ACTIONS OR PROCEEDINGS RELATING TO THIS
AGREEMENT SHALL BE LITIGATED IN SUCH COURTS. EACH OF THE PARTIES HERETO
ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS RESPECTIVE PROPERTIES,
GENERALLY AND UNCONDITIONALLY, THE EXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL AND NONAPPEALABLE JUDGMENT
RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT. EACH OF THE PARTIES
HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF
ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF VIA OVERNIGHT COURIER, TO SUCH PARTY AT
THE ADDRESS SPECIFIED IN THIS AGREEMENT, SUCH SERVICE TO BECOME
EFFECTIVE FOURTEEN CALENDAR DAYS AFTER SUCH MAILING. NOTHING HEREIN
SHALL IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OF EITHER PARTY HERETO
TO SERVE ANY SUCH LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION
OVER OR TO BRING ACTIONS, SUITS OR PROCEEDINGS AGAINST THE OTHER PARTY
HERETO IN SUCH OTHER JURISDICTIONS, AND IN SUCH MANNER, AS MAY BE
PERMITTED BY ANY APPLICABLE LAW.
(signature page follows)
18
(Purchase and Subscription Agreement)
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered as of the date first above written.
TALKPOINT COMMUNICATIONS INC.
By: ________________________________
Name: Xxxxxxxx Xxxxxxxx
Title: Chief Executive Officer
MONEYLINE NETWORKS, LLC
By: ________________________________
Name:
Title:
With respect to Sections 4(e) and 13
hereof:
MONEYLINE TELERATE HOLDINGS
By: _______________________________
Name:
Title:
(Purchase and Subscription Agreement)
[INVESTOR]
By: _____________________________
Name:
Title:
Address:
[___________________________]
[___________________________]
[___________________________]
Facsimile: [_______________]
Attention: [_______________]
Schedule I
Investment Transaction
Total Number of MLN
Shares of Newly Principal Amount of Purchase Price Shares
Investor SSN/EIN # Issued Common Stock Convertible Note Transferred
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor A 1,125,000 $75,000 $300,000 4,763,653
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor B 562,500 $37,500 $150,000 2,381,827
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor C 562,500 $37,500 $150,000 2,381,827
------------------------------ ------------------ -------------------- ---------------------- --------------- -----------------
Investor D 562,500 $37,500 $150,000 2,381,827
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor E 562,500 $37,500 $150,000 2,381,827
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor F 393,750 $26,250 $105,000 1,667,270
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor G 375,000 $25,000 $100,000 1,587,885
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor H 375,000 $25,000 $100,000 1,587,885
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor I 187,500 $12,500 $50,000 793,943
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor J 112,500 $7,500 $30,000 476,366
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Investor K 56,250 $3,750 $15,000 238,183
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
TOTAL 4,875,000 $325,000 $1,300,000 20,642,493
------------------------------- ------------------ -------------------- ---------------------- --------------- -----------------
Schedule II
Warrant holder Number of shares of common stock issuable upon exercise of
Warrant1
------------------------------------------------------ ------------------------------------------------------------
Moneyline Networks, LLC 100,000
------------------------------------------------------ ------------------------------------------------------------
1 Without regard to antidilution adjustments other than those based on stock
splits, reverse splits, recombinations, reclassifications and other similar
events.
EXHIBIT A
FORM OF CONVERTIBLE NOTE
EXHIBIT B
FORM OF SECURITY AGREEMENT