EXHIBIT 10.12
IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
February 17, 2004
First American Stock Transfer
0000 Xxxx Xxxx Xxxx, Xxxxx 0
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxx
RE: LIMELIGHT MEDIA CORPORATION
Ladies and Gentlemen:
Reference is made to that certain Standby Equity Distribution Agreement
(the "Standby Equity Distribution Agreement") dated as of February ___, 2004,
pursuant to which the Company shall issue to the Cornell Capital Partners, LP
(the "Holder") Three Hundred Forty Thousand Dollars ($340,000) of the Company's
convertible debenture (the "Convertible Debenture"), which shall be convertible
into shares of the Company's common stock, par value $0.001 per share (the
"Common Stock"). The shares of Common Stock to be converted thereunder and the
shares of the Company's Common Stock, issuable to the Holder in the event that
the Holder has elected to have the interest of the Convertible Debenture,
pursuant to Section 1.06 therein, paid in common stock, are referred to herein
as, the "Conversion Shares." This shall serve as our irrevocable authorization
and direction to you (provided that you are the transfer agent of the Company at
such time) to issue the Conversion Shares or to the Holder from time to time
upon surrender to you of a properly completed and duly executed Conversion
Notice, in the form attached hereto as Exhibit I, delivered on behalf of the
Company by Xxxxx Xxxxxxxx, Esq.
Specifically, upon receipt by the Company or Xxxxx Xxxxxxxx, Esq. of a
copy of a Conversion Notice, Xxxxx Xxxxxxxx, Esq., on behalf of the Company,
shall as soon as practicable, but in no event later than one (1) Trading Day (as
defined below) after receipt of such Conversion Notice, send, via facsimile, a
Conversion Notice which shall constitute an irrevocable instruction to you to
process such Conversion Notice in accordance with the terms of these
instructions. Upon your receipt of a copy of the executed Conversion Notice, you
shall use your best efforts to, within three (3) Trading Days following the date
of receipt of the Conversion Notice, (A) issue and surrender to a common carrier
for overnight delivery to the address as specified in the Conversion Notice, a
certificate, registered in the name of the Holder or its designee, for the
number of shares of Common Stock to which the Holder shall be entitled as set
forth in the Conversion Notice or (B) provided you are participating in The
Depository Trust Company ("DTC") Fast Automated Securities Transfer Program,
upon the request of the Buyer, credit such aggregate number of shares of Common
Stock to which the Holder shall be entitled to the Holder's or its designee's
balance account with DTC through its Deposit Withdrawal At Custodian ("DWAC")
system provided the Holder causes its bank or broker to initiate the DWAC
transaction. ("Trading Day" shall mean any day on which the Nasdaq Market is
open for customary trading.)
The Company hereby confirms to you and the Holder that certificates
representing the Conversion Shares shall not bear any legend restricting
transfer of the Conversion Shares thereby and should not be subject to any
stop-transfer restrictions and shall otherwise be freely transferable on the
books and records of the Company provided that the Company counsel delivers (i)
the Notice of Effectiveness set forth in Exhibit II attached hereto and (ii) an
opinion of counsel in the form set forth in Exhibit III attached hereto, and
that if the Conversion Shares are not registered for sale under the Securities
Act of 1933, as amended, then the certificates for the Conversion Shares shall
bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS,
OR AN OPINION OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO
THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT
OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO
RULE 144 UNDER SAID ACT."
The Company hereby confirms and First American Stock Transfer acknowledges
that in the event Counsel to the Company does not issue an opinion of counsel as
required to issue the Conversion Shares and or the shares common stock issuable
for the interest, free of legend the Company authorizes and First American Stock
Transfer will accept an opinion of Counsel from Xxxxxx Xxxxxxxx LLP.
The Company hereby confirms to you and the Holder that no instructions
other than as contemplated herein will be given to you by the Company with
respect to the Conversion Shares. The Company hereby agrees that it shall not
replace First American Stock Transfer as the Company's transfer agent without
the prior written consent of the Holder.
Any attempt by you to resign as transfer agent hereunder shall not be
effective until such time as the Company provides to you written notice that a
suitable replacement has agreed to serve as transfer agent and to be bound by
the terms and conditions of these Irrevocable Transfer Agent Instructions.
The Company and First American Stock Transfer hereby acknowledge and
confirm that complying with the terms of this Agreement does not and shall not
prohibit First American Stock Transfer from satisfying any and all fiduciary
responsibilities and duties it may owe to the Company.
The Company and First American Stock Transfer acknowledge that the Holder
is relying on the representations and covenants made by the Company hereunder
and are a material inducement to the Holder entering into the Standby Equity
Distribution Agreement. The Company and First American Stock Transfer, further
acknowledge that without such representations and covenants of the Company and
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First American Stock Transfer made hereunder, the Holder would not enter into
the Standby Equity Distribution Agreement.
Each party hereto specifically acknowledges and agrees that in the event
of a breach or threatened breach by a party hereto of any provision hereof, the
Holder will be irreparably damaged and that damages at law would be an
inadequate remedy if these Irrevocable Transfer Agent Instructions were not
specifically enforced. Therefore, in the event of a breach or threatened breach
by a party hereto, including, without limitation, the attempted termination of
the agency relationship created by this instrument, the Holder shall be
entitled, in addition to all other rights or remedies, to an injunction
restraining such breach, without being required to show any actual damage or to
post any bond or other security, and/or to a decree for specific performance of
the provisions of these Irrevocable Transfer Agent Instructions.
* * * * *
3
IN WITNESS WHEREOF, the parties have caused this letter agreement
regarding Irrevocable Transfer Agent Instructions to be duly executed and
delivered as of the date first written above.
COMPANY:
LIMELIGHT MEDIA GROUP INC.
By: /s/ Xxxxx Xxxx
--------------------------------
Name: Xxxxx Xxxx
Title: President
/s/ Xxxxx Xxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxx, Esq.
ACKNOWLEDGED AND AGREED:
FIRST AMERICAN STOCK TRANSFER
By:
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Name:
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Title:
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4
SCHEDULE I
SCHEDULE OF HOLDER
ADDRESS/FACSIMILE
NAME SIGNATURE NUMBER OF BUYER
-------------------------------- ----------------------------------- ----------------------------------
Cornell Capital Partners, LP By: Yorkville Advisors, LLC 000 Xxxxxx Xxxxxx - Xxxxx 0000
Xxx: Xxxxxxx Xxxxxxx Xxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
By:
------------------------------
Name: Xxxx X. Xxxxxx
Its: Portfolio Manager
SCHEDULE I-1
EXHIBIT I
TO IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
FORM OF CONVERSION NOTICE
Reference is made to the Standby Equity Distribution Agreement (the
"Standby Equity Distribution Agreement") between Limelight Media Group Inc.,
(the "Company"), and Cornell Capital Partners, LP, dated February ___, 2004. In
accordance with and pursuant to the Standby Equity Distribution Agreement, the
undersigned hereby elects to convert convertible debentures into shares of
common stock, par value $0.001 per share (the "Common Stock"), of the Company
for the amount indicate below as of the date specified below.
Conversion Date:
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Amount to be converted: $
------------------------------------
Amount of Debenture unconverted: $
------------------------------------
Conversion Price per share: $
------------------------------------
Amount of Interest: $
------------------------------------
Conversion Price per share: $
------------------------------------
Shares of Common Stock Issuable:
------------------------------------
Please confirm the following information:
------------------------------------
Total Number of shares of Common Stock to be issued:
------------------
Please issue the shares of Common Stock in the following name and to the
following address:
Issue to:
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Authorized Signature:
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Name:
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Title:
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Phone #:
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Broker DTC Participant Code:
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Account Number*:
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* NOTE THAT RECEIVING BROKER MUST INITIATE TRANSACTION ON DWAC SYSTEM.
EXHIBIT I-1
EXHIBIT II
TO IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
FORM OF NOTICE OF EFFECTIVENESS
OF REGISTRATION STATEMENT
February __, 2004
First American Stock Transfer
0000 Xxxx Xxxx Xxxx, Xxxxx 0
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxx
RE: LIMELIGHT MEDIA GROUP, INC.
Ladies and Gentlemen:
We are counsel to Limelight Media Group Inc., a Nevada corporation (the
"Company"), and have represented the Company in connection with that certain
Standby Equity Distribution Agreement, dated as of February ___, 2004 (the
"Standby Equity Distribution Agreement"), entered into by and among the Company
and the Investor as set forth therein pursuant to which the Company has agreed
to issue to the Investor Three Hundred Forty Thousand Dollars ($340,000) of
convertible debentures, which shall be convertible into shares (the "Conversion
Shares") of the Company's common stock, par value $0.001 per share (the "Common
Stock"), in accordance with the terms of the Standby Equity Distribution
Agreement. Pursuant to the Standby Equity Distribution Agreement, the Company
also has entered into a Registration Rights Agreement, dated as of February ___,
2004, with the Investor (the "Investor Registration Rights Agreement") pursuant
to which the Company agreed, among other things, to register the Conversion
Shares under the Securities Act of 1933, as amended (the "1933 Act"). In
connection with the Company's obligations under the Standby Equity Distribution
Agreement and the Registration Rights Agreement, on _______, 2003, the Company
filed a Registration Statement (File No. ___-_________) (the "Registration
Statement") with the Securities and Exchange Commission (the "SEC") relating to
the sale of the Conversion Shares.
In connection with the foregoing, we advise you that a member of the SEC's
staff has advised us by telephone that the SEC has entered an order declaring
the Registration Statement effective under the 1933 Act at 5:00 P.M. on
__________, 2004 and we have no knowledge, after telephonic inquiry of a member
of the SEC's staff, that any stop order suspending its effectiveness has been
issued or that any proceedings for that purpose are pending before, or
threatened by, the SEC and the Conversion Shares are available for sale under
the 1933 Act pursuant to the Registration Statement.
EXHIBIT II-1
The Investor has confirmed it shall comply with all securities laws and
regulations applicable to it including applicable prospectus delivery
requirements upon sale of the Conversion Shares.
Very truly yours,
Xxxxxxxxxxx & Xxxxxxxx, LLP
EXHIBIT II-2
EXHIBIT III
TO IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
FORM OF OPINION
____________ ___, 2004
VIA FACSIMILE AND REGULAR MAIL
First American Stock Transfer
0000 Xxxx Xxxx Xxxx, Xxxxx 0
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxx Xxxxx
RE: LIMELIGHT MEDIA GROUP INC.
Ladies and Gentlemen:
We have acted as special counsel to Limelight Media Group Inc., (the
"Company"), in connection with the registration of ___________shares (the
"Shares") of its common stock with the Securities and Exchange Commission (the
"SEC"). We have not acted as your counsel. This opinion is given at the request
and with the consent of the Company.
In rendering this opinion we have relied on the accuracy of the Company's
Registration Statement on Form SB-2, as amended (the "Registration Statement"),
filed by the Company with the SEC on _________ ___, 2004. The Company filed the
Registration Statement on behalf of certain selling stockholders (the "Selling
Stockholders"). This opinion relates solely to the Selling Shareholders listed
on Exhibit "A" hereto and number of Shares set forth opposite such Selling
Stockholders' names. The SEC declared the Registration Statement effective on
__________ ___, 2004.
We understand that the Selling Stockholders acquired the Shares in a
private offering exempt from registration under the Securities Act of 1933, as
amended. Information regarding the Shares to be sold by the Selling Shareholders
is contained under the heading "Selling Stockholders" in the Registration
Statement, which information is incorporated herein by reference. This opinion
does not relate to the issuance of the Shares to the Selling Stockholders. The
EXHIBIT III-1
opinions set forth herein relate solely to the sale or transfer by the Selling
Stockholders pursuant to the Registration Statement under the Federal laws of
the United States of America. We do not express any opinion concerning any law
of any state or other jurisdiction.
In rendering this opinion we have relied upon the accuracy of the
foregoing statements.
Based on the foregoing, it is our opinion that the Shares have been
registered with the Securities and Exchange Commission under the Securities Act
of 1933, as amended, and that First American Stock Transfer may remove the
restrictive legends contained on the Shares. This opinion relates solely to the
number of Shares set forth opposite the Selling Stockholders listed on Exhibit
"A" hereto.
This opinion is furnished to you specifically in connection with the
issuance of the Shares, and solely for your information and benefit. This letter
may not be relied upon by you in any other connection, and it may not be relied
upon by any other person or entity for any purpose without our prior written
consent. This opinion may not be assigned, quoted or used without our prior
written consent. The opinions set forth herein are rendered as of the date
hereof and we will not supplement this opinion with respect to changes in the
law or factual matters subsequent to the date hereof.
Very truly yours,
Xxxxxxxxxxx & Xxxxxxxx, LLP
EXHIBIT III - 2
EXHIBIT "A"
(LIST OF SELLING STOCKHOLDERS)
NAME: NO. OF SHARES:
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EXHIBIT A-1
