Exhibit 10.1
COMPANY VOTING AND LOCK-UP AGREEMENT
This Company Voting and Lock-Up Agreement (the "VOTING AGREEMENT") is
made as of December 27, 2005, by and among JAG Media Holdings, Inc., a Nevada
corporation ("PARENT"), Xxxxxx Xxxxx and Xxxxxxx X. Xxxxxx, each a stockholder
(each individually, a "STOCKHOLDER" and together, the "STOCKHOLDERS") of
Cryptometrics, Inc., a Delaware corporation. (the "COMPANY").
RECITALS:
WHEREAS, concurrently with the execution and delivery of this Voting
Agreement, Parent, Cryptometrics Acquisition, Inc., a Delaware corporation and
wholly owned subsidiary of Parent ("MERGER SUB") and the Company are entering
into an Agreement and Plan of Merger of even date herewith (the "MERGER
AGREEMENT"), pursuant to which Merger Sub will be merged with and into the
Company, and the Company shall be the surviving corporation following the merger
(the "MERGER");
WHEREAS, as of the date hereof, each Stockholder is a Beneficial Owner
(as defined below) of Subject Shares (as defined below); and
WHEREAS, in order to induce Parent to enter into the Merger Agreement,
the Stockholders have agreed to enter into this Voting Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and of the
covenants and agreements set forth herein and in the Merger Agreement, and
intending to be legally bound hereby, the parties agree as follows:
1. Definitions.
(a) "BENEFICIALLY OWN" or "BENEFICIAL OWNER" with respect to any
securities means having "beneficial ownership" as determined pursuant to Rule
13d-3 under the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT").
(b) "COMPANY CAPITAL STOCK" means shares of common stock, par value
$0.001 per share, of the Company.
(c) "COMPANY OPTIONS AND OTHER RIGHTS" means options, warrants and
other rights to acquire, directly or indirectly, shares of Company Capital
Stock.
(d) "EXPIRATION DATE" means the earlier to occur of (i) the
Effective Time (as defined in the Merger Agreement) or (ii) the date on which
the Merger Agreement is terminated pursuant to its terms.
(e) "SUBJECT SHARES" means (i) all shares of Company Capital Stock
Beneficially Owned by each Stockholder as of the date of this Voting Agreement
and (ii) all additional shares of Company Capital Stock of which each
Stockholder acquires Beneficial Ownership during the period from the date of
this Voting Agreement through the Expiration Date.
2. Voting.
(a) Each Stockholder hereby agrees that, prior to the Expiration
Date, at any meeting of the stockholders of the Company, however called, and in
any written action by consent of stockholders of the Company, unless otherwise
directed in writing by Parent, each Stockholder shall cause to be counted as
present thereat for purposes of establishing a quorum and shall vote, or cause
to be voted, any and all Subject Shares Beneficially Owned by each Stockholder
as of the record date of such meeting or written consent:
(i) for the execution and delivery by the Company of the Merger
Agreement and the adoption and approval of the Merger Agreement and the terms
thereof, in favor of each of the other actions contemplated by the Merger
Agreement and in favor of any action in furtherance of any of the foregoing;
(ii) against any action or agreement that would result in a breach
of any representation, warranty, covenant or obligation of the Company in the
Merger Agreement; and
(iii) against the following actions (other than the Merger and the
transactions contemplated by the Merger Agreement): (A) any extraordinary
corporate transaction, such as a merger, consolidation or other business
combination involving the Company or any subsidiary of the Company; (B) any
sale, lease, sublease, license, sublicense or transfer of a material portion of
the rights or other assets of the Company or any subsidiary of the Company; (C)
any reorganization, recapitalization, dissolution or liquidation of the Company
or any subsidiary of the Company; (D) any change in the individuals who serve as
members of the board of directors of the Company; (E) any amendment to the
Company's certificate of incorporation or bylaws; (F) any material change in the
capitalization of the Company or the Company's corporate structure; and (G) any
other action which is intended, or could reasonably be expected, to impede,
interfere with, delay, postpone, discourage or adversely affect the Merger or
any of the other transactions contemplated by the Merger Agreement or this
Agreement.
(b) No provision contained in this Agreement shall prohibit either
Stockholder from voting in his capacity as a director of the Company in any
manner whatsoever.
(c) Prior to the Expiration Date, neither Stockholder shall enter
into any agreement or understanding with any Person requiring him to vote in his
capacity as a stockholder or give instructions in any manner inconsistent with
clause "(i)," clause "(ii)" or clause "(iii)" of this Section 2(a).
(d) Each Stockholder hereby waives and agrees not to exercise any
applicable "appraisal rights" under the Delaware General Corporation Law with
respect to the Subject Shares in connection with the Merger and the Merger
Agreement.
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3. Lock-up Agreement.
(a) In consideration of the issuance of common stock of Parent in
exchange for the Subject Shares (the "PARENT SHARES") to each of the
Stockholders pursuant to the terms of the Merger Agreement, and of other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and not withstanding any registration on the part of the Parent
Shares under the Securities Act of 1933, as amended, each Stockholder agrees
that, during the period beginning from the Effective Time (as defined in the
Merger Agreement) and continuing for one (1) year thereafter (the "RELEASE
DATE"), each Stockholder will not (a) offer, sell, contract to sell, pledge,
grant any option to purchase, make any short sale or otherwise dispose of any
Parent Shares, or (b) engage directly or indirectly in any transaction the
likely result of which would involve a transaction prohibited by clause (a),
except each case as permitted by Section 3(e) below.
(b) The foregoing restriction is expressly agreed to preclude each
of the Stockholders from engaging in any hedging or other transaction which is
designed to, or reasonably expected to lead to, or result in, a sale or
disposition of the Parent Shares even if such shares would be disposed of by
someone other than the Stockholders. Such prohibited hedging or other
transactions would include without limitation any short sale or any purchase,
sale or grant of any right (including without limitation any put or call option)
with respect to any of the Parent Shares or with respect to any security that
includes, relates to, or derives any significant part of its value from the
Parent Shares.
(c) Each Stockholder further represents and agrees that the
undersigned has not taken and will not take, directly or indirectly, any action
which is designed to or which has constituted or which might reasonably be
expected to cause or result in stabilization or manipulation of the price of any
security of Parent to facilitate the sale or resale of the Parent Shares, or
which has otherwise constituted or will constitute any prohibited bid for or
purchase of the Parent Shares or any related securities.
(d) Each Stockholder acknowledges and agrees that, pending the
Release Date, any additional Parent Shares acquired by such Stockholder upon
exercise of Replacement Stock Options (as defined in the Merger Agreement) may
not be sold or otherwise transferred notwithstanding that a registration
statement on Form S-8 or Form S-4 may be effective with respect to the exercise
of such options and the sale of Parent Shares obtained thereby.
(e) Notwithstanding the foregoing restrictions on transfer, each
Stockholder may transfer the Parent Shares (i) in an amount not to exceed 35% of
the total amount of Parent Shares received by such Stockholder pursuant to the
Merger; provided however that such Parent Shares may not be transferred unless
the Parent Shares are registered under the Securities Act of 1933, as amended,
or (ii) as transfers by will or intestacy, or (iii) to any trust for the direct
or indirect benefit of any of the Stockholder or the immediate family of such
Stockholder; provided that any such transfer shall not involve a disposition for
value. For purposes of this letter agreement, "immediate family" shall mean any
relationship by blood, marriage or adoption, not more remote than first cousin.
(f) Each of the Stockholders now has, and, except as contemplated by
the preceding paragraph (e), at all times prior to the Release Date will have,
good and marketable title to the Parent Shares still owned by him, free and
clear of all liens, encumbrances, and claims whatsoever. Each of the
Stockholders agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent and registrar against the transfer of the Parent
Shares except in compliance with the foregoing restrictions in Sections 3(a) and
(e) above. Each of the Stockholders understands that the restrictions with
respect to the Parent Shares set forth herein are in addition to any other
restrictions upon transfer that may arise pursuant to any other agreement to
which either of the Stockholders is a party or under applicable securities laws.
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4. Written Consent of Stockholders. Upon the U.S. Securities and
Exchange Commission's declaration of the effectiveness of the Registration
Statement on Form S-4 filed by Parent in connection with the Merger, each
Stockholder shall deliver to Parent a written consent in favor of the adoption
of the Merger Agreement and the Merger.
5. Representations and Warranties of Stockholder. Each Stockholder
represents and warrants to Parent as follows:
(a) As of the date of this Voting Agreement and at all times through
the Expiration Date:
(i) Such Stockholder is the Beneficial Owner (free and clear of
any encumbrances or restrictions) of the outstanding shares of Company Capital
Stock set forth under the heading "Shares of Company Capital Stock Beneficially
Owned", on the signature page hereof;
(ii) Such Stockholder is the Beneficial Owner (free and clear of
any encumbrances or restrictions) of the outstanding Company Options and Other
Rights set forth under the heading "Company Options and Other Rights
Beneficially Owned" on the signature page hereof; and
(iii) Such Stockholder does not directly or indirectly
Beneficially Own any shares of Company Capital Stock or Company Options or Other
Rights or other securities of the Company, other than the shares of Company
Capital Stock and Company Options and Other Rights set forth on the signature
page hereof.
(b) Each Stockholder has the legal capacity, power and authority to
enter into and perform all of its obligations under this Voting Agreement. This
Voting Agreement has been duly executed and delivered by such Stockholder, and
upon its execution and delivery by Parent, will constitute a legal, valid and
binding obligation of such Stockholder, enforceable against it in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting or
relating to creditors rights generally, and the availability of injunctive
relief and other equitable remedies.
(c) The execution, delivery and performance by each Stockholder of
this Voting Agreement will not (i) conflict with, require a consent, waiver or
approval under, or result in a breach of or default under, any of the terms of
any contract, commitment or other obligation (written or oral) to which such
Stockholder is a party or by which any of such Stockholder's assets may be
bound.
(d) No filing with, and no permit, authorization, consent or
approval of, any state or federal public body or authority is necessary for the
execution of this Voting Agreement by Stockholder and the consummation by
Stockholder of the transactions contemplated hereby.
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6. Covenants of Stockholder. Each Stockholder covenants and agrees for
the benefit of Parent that, until the Expiration Date, such Stockholder will
not:
(a) sell, transfer, pledge, hypothecate, encumber, assign, tender or
otherwise dispose of, or enter into any contract, option or other arrangement or
understanding with respect to the sale, transfer, pledge, hypothecation,
encumbrance, assignment, tender or other disposition of, (i) any Subject Shares
or any interest therein, or (ii) any Company Options and Other Rights or any
interest therein; provided, however, that Stockholder may convert, exercise or
exchange Company Options and Other Rights into or for shares of Company Capital
Stock in which event such shares of Capital Stock shall become and be deemed
Subject Shares subject to all the terms and conditions of this Voting Agreement;
(b) acquire any shares of the stock of Parent except pursuant to
existing Company Options and Other Rights;
(c) grant any powers of attorney or proxies or consents in respect
of any of the Subject Shares, deposit any of such Subject Shares into a voting
trust, or enter into a voting agreement with respect to any of such Subject
Shares; and
(d) take any other action with respect to the Subject Shares that
would in any way restrict, limit or interfere with the performance of
Stockholder's obligations hereunder or the transactions contemplated hereby and
the Merger Agreement.
7. Adjustments; Additional Shares. In the event (a) of any stock
dividend, stock split, merger, recapitalization, reclassification, combination,
exchange of shares or the like of the capital stock of the Company on, of or
affecting the Subject Shares or (b) that Stockholder shall become the Beneficial
Owner of any additional shares of Company Capital Stock or other securities
entitling the holder thereof to vote or give consent with respect to the matters
set forth in Section 2(a), then the terms of this Voting Agreement shall apply
to the shares of Company Capital Stock or other instruments or documents held by
Stockholder immediately following the effectiveness of the events described in
clause (a) or Stockholder becoming the Beneficial Owner thereof as described in
clause (b), as though, in either case, they were Subject Shares hereunder. The
foregoing shall apply (mutatis mutandis) to the Parent Shares and Section 3 of
this Voting Agreement.
8. Amendments and Waivers. Any provision of this Voting Agreement may
be amended or waived if, and only if, such amendment or waiver is in writing and
is signed, in the case of an amendment, by each party to this Voting Agreement,
or in the case of a waiver, by the party against whom the waiver is to be
effective. No failure or delay by any party in exercising any right or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. To the maximum extent permitted by law,
(a) no waiver that may be given by a party shall be applicable except in the
specific instance for which it was given and (b) no notice to or demand on one
party shall be deemed to be a waiver of any obligation of such party or the
right of the party giving such notice or demand to take further action without
notice or demand.
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9. Assignment. This Voting Agreement may not be assigned by any party
hereto without the prior written consent of the other parties. Subject to the
foregoing, all of the terms and provisions of this Voting Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
executors, heirs, personal representatives, successors and assigns.
10. Entire Agreement. This Voting Agreement and the documents,
instruments and other agreements specifically referred to herein or delivered
pursuant hereto, set forth the entire understanding of the parties with respect
to the subject matter hereof. Any and all previous agreements and understandings
between or among the parties regarding the subject matter hereof, whether
written or oral, are superseded by this Voting Agreement.
11. Notices. Any notice, request, demand, waiver, consent, approval or
other communication which is required or permitted hereunder shall be in writing
and shall be deemed given (a) on the date established by the sender as having
been delivered personally; (b) on the date delivered by a private courier as
established by the sender by evidence obtained from the courier; (c) on the date
sent by facsimile, with confirmation of transmission, if sent during normal
business hours of the recipient, if not, then on the next business day; or (d)
on the fifth day after the date mailed, by certified or registered mail, return
receipt requested, postage prepaid. Such communications, to be valid, must be
addressed as follows:
If to Parent, to:
JAG Media Holdings, Inc.
0000 XX 00xx Xxxxxx, Xxxxx X00
Xxxx Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx
Facsimile: 000-000-0000
With a required copy to:
Xxxxxx, Xxxxx & Bockius LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: W. Xxxxxxx Xxxxxxxxx, Xx., Esq.
Facsimile: 000-000-0000
If to:
Xxxxxx Xxxxx or Xxxxxxx X. Xxxxxx
c/o Cryptometrics, Inc.
00 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Facsimile: (000) 000-0000
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With a required copy to:
Xxxx, Xxxxxx & Stolzar, LLP
0 Xxxxx Xxxxxxxx, Xxxxx 000
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxx, Esq.
Facsimile: 000-000-0000
or to such other address or to the attention of such person or persons as the
recipient party has specified by prior written notice to the sending party (or
in the case of counsel, to such other readily ascertainable business address as
such counsel may hereafter maintain). If more than one method for sending notice
as set forth above is used, the earliest notice date established as set forth
above shall control.
12. Captions. All captions contained in this Voting Agreement are for
convenience of reference only, do not form a part of this Voting Agreement and
shall not affect in any way the meaning or interpretation of this Voting
Agreement.
13. Severability; Enforcement. Any provision of this Voting Agreement
which is invalid or unenforceable in any jurisdiction shall be ineffective to
the extent of such invalidity or unenforceability without invalidating or
rendering unenforceable the remaining provisions hereof, and any such invalidity
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
14. Specific Performance. Stockholder acknowledges that the agreements
contained in this Voting Agreement are an integral part of the transactions
contemplated by the Merger Agreement, and that, without these agreements, Parent
would not enter into the Merger Agreement, and acknowledges that damages would
be an inadequate remedy for any breach by Stockholder of the provisions of this
Voting Agreement. Accordingly, Stockholder agrees that Stockholder's obligations
hereunder shall be specifically enforceable and Stockholder shall not take any
action to impede the other from seeking to enforce such right of specific
performance.
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15. Consent to Jurisdiction. Each party irrevocably submits to the
exclusive jurisdiction of (a) New York County, New York, and (b) the United
States District Court for the Southern District of New York, for the purposes of
any action, suit or proceeding arising out of this Voting Agreement or any
transaction contemplated hereby. Each party agrees to commence any such action,
suit or proceeding either in the United States District Court for the Southern
District of New York or if such action, suit or proceeding may not be brought in
such court for jurisdictional reasons, in the Supreme Court sitting in New York
County (including its Appellate Division). Each party further agrees that
service of any process, summons, notice or document by U.S. registered mail to
such party's respective address set forth above shall be effective service of
process for any action, suit or proceeding in New York with respect to any
matters to which it has submitted to jurisdiction in this Section 15. Each party
irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of this Voting Agreement or the
transactions contemplated hereby in (i) the United States District Court for the
Southern District of New York, or (ii) the Supreme Court sitting in New York
County (including its Appellate Division), and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such action, suit or proceeding brought in any such court has been brought
in an inconvenient forum. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE)
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF SUCH PARTY IN THE
NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.
16. Governing Law. This Voting Agreement shall be governed by and
interpreted and enforced in accordance with the laws of the State of New York,
without giving effect to any choice of law or conflict of laws rules or
provisions (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, except to the extent that the voting of the Subject Shares is
subject to the corporate law of the State of Delaware.
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IN WITNESS WHEREOF, this Voting Agreement has been duly executed by the
parties hereto all as of the day and year first above written.
JAG MEDIA HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxx
Title: Chairman &
Chief Executive Officer
Xxxxxx Xxxxx
/s/ Xxxxxx Xxxxx
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(Signature)
Xxxxxx Xxxxx
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Print Name
Number and class of shares of Capital Stock: 2,975,000 shares of
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common stock
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Number of Company Options and Other Rights:
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Xxxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
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(Signature)
Xxxxxxx X. Xxxxxx
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Print Name
Number and class of shares of Capital Stock: 2,975,000 shares of
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common stock
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Number of Company Options and Other Rights:
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