SECURITIES PURCHASE AGREEMENT
Execution
Copy
SECURITIES PURCHASE AGREEMENT
(the “Agreement”), dated
as of December __, 2007, by and among T3 Motion, Inc., a Delaware corporation
(the “Company”), and
Immersive Media Corp., an Alberta, Canada corporation (the “Purchaser”).
RECITALS
A. The
Company and the Purchaser are executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by Section
4(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506 of
Regulation D (“Regulation D”) as
promulgated by the United States Securities and Exchange Commission (the “SEC”) thereunder.
B. The
Purchaser wishes to purchase, and the Company wishes to sell, upon the terms and
conditions stated in this Agreement, (i) 1,851,852 shares of the Company’s
common stock, par value $0.001 per share (the “Common Shares”), at $1.62 per
share, for an aggregate purchase price of $3,000,000; (ii) $2,000,000 in
principal amount of 12% Promissory Note, in substantially the form attached
hereto as Exhibit
A (the “Note”)
and (ii) warrants in substantially the form attached hereto as Exhibit
B (the “Warrant”), to acquire up to
697,639 additional shares of common stock at an exercise price of $1.081 per
share (as exercised, collectively, the “Warrant Shares”).
C. Contemporaneously
with the execution and delivery of this Agreement, the parties hereto are
executing and delivering a Investor Rights Agreement, substantially in the form
attached hereto as Exhibit
C (the “Investor Rights
Agreement”), pursuant to which the Company will provide certain
registration rights with respect to the Registrable Securities (as defined in
the Investor Rights Agreement) under the 1933 Act and the rules and regulations,
promulgated thereunder and applicable state securities laws.
D. The
Note, the Common Shares, the Warrant and the Warrant Shares collectively are
referred to herein as the “Securities”.
NOW, THEREFORE, the Company
and the Purchaser hereby agree as follows:
1. PURCHASE AND SALE OF
SECURITIES.
(a) Purchase of
Securities.
(i) Subject
to the satisfaction (or waiver) of the conditions set forth in Sections 5 and 6
below, the Company shall issue and sell to the Purchaser, and the Purchaser
agrees to purchase from the Company on the Closing Date (as defined below), (A)
the Note, (B) the Common Shares and (C) Warrant (the “Closing”).
(ii) The
date and time of the Closing (the “Closing Date”) shall be 10:00
a.m., Pacific Time, on the date hereof (or such later date as is mutually agreed
to by the Company and the Purchaser) after notification of satisfaction (or
waiver) of the conditions to the
.
Closing set forth in
Sections 5 and 6 below, at the offices of Xxxxxxxxxx & Xxxxx LLP, 00000
Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxxxxxxx 00000
(iii) The
aggregate purchase price to be paid by Purchaser for the Common Shares shall be
$3,000,000 and $2,000,000 for the Note and the Warrant, respectively (the “Purchase Price”). The
Purchaser shall pay $1.00 for each $1.00 of principal amount of Note and related
Warrant to be purchased by the Purchaser at the Closing.
(b) Form of
Payment. On the Closing Date, (i) the Purchaser shall pay the
Purchase Price to the Company for the Common Shares, Note and the Warrant to be
issued and sold to the Purchaser at the Closing by wire transfer of immediately
available funds.
(c) Delivery of
Securities. On the Closing Date, the Company shall deliver to
Purchaser certificates representing the Note, Common Shares and
Warrant. “Business
Day” shall mean any day other than Saturday, Sunday and any day that
banks in California and Calgary, Alberta are closed.
(d) In
this Agreement (including all Exhibits hereto), all references to “$” or
“dollars” are to United States dollars.
2. PURCHASER’S REPRESENTATIONS
AND WARRANTIES.
The
Purchaser hereby represents and warrants to the Company that:
(a) No Public Sale or
Distribution. The Purchaser is (i) acquiring the Common
Shares, Note and the Warrant and (ii) upon the exercise of the Warrant will
acquire the Warrant Shares issuable upon exercise of the Warrant, for its own
account and not with a view towards, or for resale in connection with, the
public sale or distribution thereof, except pursuant to sales registered or
exempted under the 1933 Act; provided, however, that by
making the representations herein, the Purchaser does not agree to hold any of
the Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time in accordance with, or pursuant to, or a
registration statement or an exemption under the 1933 Act. The
Purchaser is acquiring the Securities hereunder in the ordinary course of its
business. The Purchaser does not presently have any agreement or
understanding, directly or indirectly, with any “Person” to distribute any of
the Securities. For purposes of this Agreement, a “Person” is any individual,
limited liability company, partnership, joint venture, corporation, trust,
unincorporated organization and government or any department or agency
thereof.
(b) Accredited Investor Status;
No General Solicitation. The Purchaser is an “accredited
investor” as that term is defined in Rule 501(a) of Regulation D. The
definition of “accredited investor” is annexed hereto as Exhibit
D. The Purchaser is not required to be registered as a broker-dealer
under Section 15 of the Exchange Act. The Purchaser is not purchasing
the Securities as a result of any advertisement, article, notice or other
communication regarding the Securities published in any newspaper, magazine or
similar media or broadcast over television or radio or presented at any seminar
or to the Purchaser’s knowledge, any general solicitation or
advertisement.
(c) Reliance on
Exemptions. The Purchaser understands that the Securities are
being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and the
Purchaser’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Purchaser set forth herein in order to
determine the availability of such exemptions and the eligibility of the
Purchaser to acquire the Securities.
(d) Information. The
Purchaser and its advisors, if any, have been furnished with all materials
relating to the business, finances and operations of the Company and materials
relating to the offer and sale of the Securities which have been requested by
the Purchaser. The Purchaser and its advisors, if any, have been
afforded the opportunity to ask questions of the Company and to receive answers
thereto concerning the Company and the transactions contemplated
herein. Neither such inquiries nor any other due diligence
investigations conducted by the Purchaser or its advisors, if any, or its
representatives shall modify, amend or affect the Purchaser’s right to rely on
the Company’s representations and warranties contained herein. The
Purchaser understands that its investment in the Securities involves a high
degree of risk. The Purchaser has sought such accounting, legal and
tax advice as it has considered necessary to make an informed investment
decision with respect to its acquisition of the Securities.
Without limiting the
generality of the foregoing, Purchaser acknowledges that the Company is a
start-up corporation without mature revenue and without earnings. The
Company’s product(s) that are being designed, manufactured, marketed, field
trialed, and otherwise tested are a new form of vehicle that is being introduced
into the marketplace. As such, certain unknown factors are present
within the testing and long-term reliability of the product(s). As
certain material defects arise, the Company has fixed or re-engineered the
issues(s) and is presently on course to launch batch
manufacturing. Future defects may occur. The Purchaser
acknowledges that they are experienced investors with start-up ventures and
therefore understand and are willing to accept this speculative risk of
investment.
(e) Investment
Experience. The Purchaser acknowledges that it can bear the
economic risk and complete loss of its investment in the Securities and has such
knowledge and experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment contemplated
hereby.
(f) No Governmental
Review. The Purchaser understands that no United States
federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Securities or the
fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
(g) Transfer or
Resale. The Purchaser understands that except as provided in
the Investor Rights Agreement: (i) the Securities have not been and
will not be registered under the 1933 Act or any state securities laws, and may
not be offered for sale, sold, assigned or transferred unless (A) subsequently
registered thereunder, (B) the Purchaser shall have delivered to the Company an
opinion of counsel, in a generally acceptable form, to the effect that such
Securities to be sold, assigned or transferred may be sold, assigned or
transferred pursuant to an exemption from such registration, or (C) the
Purchaser provides the Company with reasonable assurance that such Securities
can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A
promulgated under the 1933 Act, as amended (or a successor rule thereto)
(collectively, “Rule
144”); (ii) any sale of the Securities made in reliance on Rule 144 may
be made only in accordance with the terms of Rule 144 and further, if Rule 144
is not applicable, any resale of the Securities under circumstances in which the
seller (or the Person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the 0000 Xxx) may require compliance
with some other exemption under the 1933 Act or the rules and regulations of the
SEC thereunder; and (iii) neither the Company nor any other Person is under any
obligation to register the Securities under the 1933 Act or any state securities
laws or to comply with the terms and conditions of any exemption
thereunder. The Purchaser further understands that the Securities
will be subject to restrictions on transfer under applicable Canadian securities
laws.
(h) Legends. The
Purchaser understands that the certificates or other instruments representing
the Note and the Warrant and, until such time as the resale of the Warrant
Shares have been registered under the 1933 Act as contemplated by the Investor
Rights Agreement, the stock certificates representing the Warrant Shares, except
as set forth below, shall bear any legend required by the “blue sky” laws of any
state and the laws of the Province of Alberta, Canada, and a restrictive legend
in substantially the following form (and a stop-transfer order may be placed
against transfer of such stock certificates):
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A
GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
(II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.
UNLESS
PERMITTED UNDER CANADIAN SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY
MUST NOT TRADE THE SECURITY IN CANADA BEFORE THE DATE THAT IS 4 MONTHS AND A DAY
AFTER THE LATER OF (I) [INSERT THE DISTRIBUTION
DATE], AND (II) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY
PROVINCE OR TERRITORY
(i) Validity;
Enforcement. This Agreement and the Investor Rights Agreement
to which Purchaser is a party have been duly and validly authorized, executed
and delivered on behalf of the Purchaser and shall constitute the legal, valid
and binding obligations of the Purchaser enforceable against the Purchaser in
accordance with their respective terms, except as such enforceability may be
limited by general principles of equity or to applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other similar laws relating to, or
affecting generally, the enforcement of applicable creditors’ rights and
remedies.
(j) Residency;
Organization. The Purchaser is a resident of Alberta, Canada
and the Purchaser is a validly existing corporation and has all requisite
corporate power and authority to invest in the Securities pursuant to this
Agreement.
(k) Brokers and
Finders. No Person will have, as a result of the transactions
contemplated by this Agreement and the other Transaction Documents (as defined
herein), any valid right, interest or claim against or upon the Purchaser for
any commission, fee or other compensation pursuant to any agreement, arrangement
or understanding entered into by or on behalf of the Purchaser.
3. REPRESENTATIONS AND
WARRANTIES OF THE COMPANY.
The
Company represents and warrants to the Purchaser that:
(a) Organization and
Qualification. The Company and its “Subsidiaries” (which for
purposes of this Agreement means any entity in which the Company, directly or
indirectly, owns capital stock or holds an equity or similar interest) are each
an entity duly organized and validly existing in good standing under the laws of
the jurisdiction in which it is formed, and have the requisite power and
authority to own their properties and to carry on their business as now being
conducted. Each of the Company and its Subsidiaries is duly qualified
as a foreign entity to do business and is in good standing in every jurisdiction
in which its ownership of property or the nature of the business conducted by it
makes such qualification necessary, except to the extent that the failure to be
so qualified or be in good standing would not have a Material Adverse
Effect. As used in this Agreement, “Material Adverse Effect” means
any material adverse effect on (i) the business, properties, assets, operations,
results of operations, condition (financial or otherwise) or prospects of the
Company and its Subsidiaries, taken as a whole, (ii) the authority or ability of
the Company to complete the transactions contemplated hereby, by the other
Transaction Documents (as defined herein) or by the agreements and instruments
to be entered into in connection herewith or therewith, or (iii) the authority
or ability of the Company to perform its obligations under this Agreement and
the other Transaction Documents. The Company has no Subsidiaries
except T3 Motion Europe Limited.
(b) Authorization;
Enforcement; Validity. The Company has the requisite power and
authority to enter into and perform its obligations under this Agreement, the
Note, the Investor Rights Agreement, the Warrant, and each of the other
agreements entered into by the parties hereto in connection with the
transactions contemplated by this Agreement (collectively,
the “Transaction
Documents”) and to issue the Securities in accordance with the terms
hereof and thereof. The execution and delivery of this Agreement and
the other Transaction Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby, including, without
limitation, the issuance of the Common Shares, the Note and the Warrant, the
reservation for issuance and issuance of 100% of the Warrant Shares upon
exercise of the Warrant have been duly authorized by the Company’s Board of
Directors and no further filing, consent, or authorization is required by the
Company, its Board of Directors or its stockholders, except for post-closing
securities filings or notifications required to be made under federal, state or
provincial securities laws. This Agreement and the other Transaction
Documents have been duly executed and delivered by the Company, and shall
constitute the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of applicable creditors’
rights and remedies.
(c) Issuance of
Securities. The issuance of the Securities has been duly
authorized and will be free from all taxes, liens and charges with respect to
the issue thereof. As of the Closing, a number of shares of Common
Stock shall have been duly authorized and reserved for issuance which equals at
least 100% of the maximum number of shares of Common Stock issuable upon
exercise of the Warrant. Upon issuance of the Common Shares, the Note
and the Warrant against payment of the Purchase Price, and upon the issuance of
the Warrant Shares upon due exercise of the Warrant and the payment of the
applicable exercise price therefor, the Common Shares and Warrant Shares will be
validly issued, fully paid and nonassessable and free from all preemptive or
similar rights, taxes, liens and charges with respect to the issue thereof, with
the holders of the Common Shares and Warrant Shares being entitled to all rights
accorded to a holder of Common Stock. Each Common Share is entitled
to one (1) vote at meetings of holders of Common Stock.
(d) No
Conflicts. The execution, delivery and performance of this
Agreement and the other Transaction Documents by the Company and the
consummation by the Company of the transactions contemplated hereby and thereby
(including, without limitation, the issuance of the Common Shares, the Note and
the Warrant, and reservation for issuance and issuance of the Warrant Shares)
will not (i) result in a violation of the Certificate of Incorporation (as
defined below) of the Company or any of its Subsidiaries or Bylaws (as defined
below) of the Company or any of its Subsidiaries or (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or result in termination, amendment, acceleration
or cancellation of, any agreement, indenture or instrument to which the Company
or any of its Subsidiaries is a party, or (iii) result in a violation of any
law, rule, regulation, order, judgment or decree applicable to the Company or
any of its Subsidiaries or by which any property or asset of the Company or any
of its Subsidiaries is bound or affected, except in the cases of clauses (ii)
and (iii) for any such conflicts, violations or defaults which can reasonably be
expected to have no Material Adverse Effect.
(e) Consents. The
Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court, governmental agency or any
regulatory
or self-regulatory agency or any other Person in order for it to execute,
deliver or perform any of its obligations under or contemplated by this
Agreement or the other Transaction Documents, in each case in accordance with
the terms hereof or thereof, except for post-closing securities filings or
notifications to be made under federal, state or provincial securities
laws. All consents, authorizations, orders, filings and registrations
which the Company is required to obtain pursuant to the preceding sentence have
been obtained or effected on or prior to the Closing Date, except for the filing
with the SEC of one or more Registration Statements in accordance with the
requirements of the Investor Rights Agreement and except for the filing with the
SEC of a Form D and with the Alberta Securities Commission of a Form 45-106F1
with respect to the issuance of the Securities. The Company and its
Subsidiaries are unaware of any facts or circumstances which might prevent the
Company from obtaining or effecting any of the registration, application or
filings pursuant to the preceding sentence.
(f) No General Solicitation;
Placement Agent’s Fees. Neither the Company, nor any of its
“Affiliates” (as such term is defined in Rule 405 under the 1933 Act), nor any
Person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D) in
connection with the offer or sale of the Securities. The Company
shall be responsible for the payment of any placement agent’s fees, financial
advisory fees, or brokers’ commissions (other than for persons engaged by any
Purchaser or its investment advisor) relating to or arising out of the
transactions contemplated hereby. The Company shall pay, and hold the
Purchaser harmless against, any liability, loss or expense (including, without
limitation, attorney’s fees and out-of-pocket expenses) arising in connection
with any such claim.
(g) Private Placement; No
Integrated Offering. Subject to the accuracy of the
Purchaser’s representations and warranties in Section 2 of this Agreement, the
offer and sale by the Company of the Securities in conformity with the terms of
this Agreement constitute transactions that are exempt from registration under
the 1933 Act. None of the Company, its Subsidiaries, any of their
Affiliates, and any Person acting on their behalf has, directly or indirectly,
made any offers or sales of any security or solicited any offers to buy any
security, under circumstances that would require registration of any of the
Securities under the 1933 Act or cause this offering of the Securities to be
integrated with prior offerings by the Company for purposes of the 1933 Act or
any applicable stockholder approval provisions, including, without limitation,
under the rules and regulations of any exchange or automated quotation system on
which any of the securities of the Company are listed or
designated. None of the Company, its Subsidiaries, their Affiliates
and any Person acting on their behalf will take any action or steps referred to
in the preceding sentence that would require registration of any of the
Securities under the 1933 Act or cause the offering of the Securities to be
integrated with other offerings.
(h) Use of
Proceeds. The net proceeds of the sale of the Common Shares,
the Note and the Warrant hereunder shall be used by the Company for working
capital and general corporate purposes, provided that at least $1,000,000 of
such net proceeds shall be used to purchase from the Purchaser non-recurring
engineering to be provided by the Purchaser.
(i) Conduct of Business;
Regulatory Permits. Neither the Company nor any of its
Subsidiaries is in violation of any term of, or is in default under, its
Certificate of Incorporation
or other organization document, or its Bylaws. Neither the Company
nor any of its Subsidiaries is in violation of any judgment, decree or order or
any statute, ordinance, rule or regulation that are necessary or applicable to
the operation of the Company or its Subsidiaries as currently and proposed to be
conducted and neither the Company nor any of its Subsidiaries will conduct its
business in violation of the foregoing statutes, ordinances, rules and
regulations, except for possible violations which would not, individually or in
the aggregate, have a Material Adverse Effect. The Company has, to
its knowledge, complied with all laws, regulations and orders applicable to its
present and proposed business and has all material permits and licenses required
thereby, except for any violation of or default under any laws, regulations or
orders which will not have a Material Adverse Effect. The Company is
not, or with the passing of time or the giving of notice would not be, in breach
of, or default under, any term or provision of any mortgage, indenture,
contract, agreement or instrument to which the Company is a party or by which it
is bound which breach or default would have a Material Adverse Effect or, as far
as the Company may now foresee, in the future is reasonably likely to have a
Material Adverse Effect. To the Company’s knowledge, there is no provision of
any state or federal judgment, decree, order, statute, rule or regulation
applicable to or binding upon the Company that has a Material Adverse Effect or,
as far as the Company may now foresee, in the future is reasonably likely to
have a Material Adverse Effect.
(j) Transactions With
Affiliates. None of the officers, directors or employees of
the Company is presently a party to any transaction with the Company or any of
its Subsidiaries (other than for ordinary course services as employees, officers
or directors), including any contract, agreement or other arrangement providing
for the furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or from any
such officer, director or employee or, to the knowledge of the Company, any
corporation, partnership, trust or other entity in which any such officer,
director, or employee has a substantial interest or is an officer, director,
trustee or partner.
(k) Equity
Capitalization. (i) As of the date hereof, the
authorized capital stock of the Company consists of (i) 50,000,000 shares of
Common Stock, of which as of the date hereof, 37,279,833 are issued and
outstanding and (ii) no shares of preferred stock. All of such
outstanding shares have been validly issued and are fully paid and nonassessable
and were issued in full compliance with applicable state and federal securities
law and any rights of third parties. All of the issued and
outstanding shares of capital stock of each Subsidiary have been duly authorized
and validly issued and are fully paid, nonassessable and free of pre-emptive
rights, and were issued in full compliance with applicable state and federal
securities law and any rights of third parties and are owned by the Company,
beneficially and of record, subject to no lien, encumbrance or other adverse
claim. None of the Company’s or the Subsidiaries’ share capital is
subject to pre-emptive rights or any other similar rights or any liens or
encumbrances suffered or permitted by the Company or any
Subsidiary. Except with respect to the Warrant and employee and
service provider options to purchase 5,414,000 shares of Common Stock, there are
no outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any share capital of the
Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become
bound to issue additional share capital of the Company or any of its
Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any share capital of the
Company or any of its Subsidiaries. There are no outstanding debt
securities, notes, credit agreements, credit facilities or other agreements,
documents or instruments evidencing Indebtedness (as defined below) of the
Company or any of its Subsidiaries or by which the Company or any of its
Subsidiaries is or may become bound. There are no financing statements securing
obligations in any material amounts, either singly or in the aggregate, filed in
connection with the Company or any of its Subsidiaries. There are no
agreements or arrangements under which the Company is obligated to register the
sale of any of its securities under the 1933 Act (except the Investor Rights
Agreement).
(ii) The issuance and sale
of the Common Shares, Note and Warrant hereunder will not obligate the Company
to issue shares of Common Stock or other securities to any other Person (other
than the Purchaser) and will not result in the adjustment of the exercise,
conversion, exchange or reset price of any outstanding security.
(iii) The Company has
furnished to the Purchaser true, correct and complete copies of the Company’s
Certificate of Incorporation, as amended and as in effect on the date hereof
(the “Certificate of
Incorporation”), and the Company’s Bylaws, as amended and as in effect on
the date hereof (the “Bylaws”), and the terms of all
securities convertible into, or exercisable or exchangeable for, shares of
Common Stock and the material rights of the holders thereof in respect
thereto.
(l) Indebtedness and Other
Contracts. The Company (i) has no outstanding Indebtedness,
(ii) is not a party to any contract, agreement or instrument, the violation of
which, or default under which, by the other party(ies) to such contract,
agreement or instrument would result in a Material Adverse Effect, (iii) is not
in violation of any term of or in default under any contract, agreement or
instrument relating to any Indebtedness, except where such violations and
defaults would not result, individually or in the aggregate, in a Material
Adverse Effect, and (iv) is not a party to any contract, agreement or instrument
relating to any Indebtedness, the performance of which has or could reasonably
be expected to have a Material Adverse Effect.
For
purposes of this Agreement: (x) “Indebtedness” of any Person
means, without duplication (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the ordinary
course of business), (C) all reimbursement or payment obligations with respect
to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by the Note, bonds, notes or similar instruments,
including obligations so evidenced incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with
the proceeds of such indebtedness (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property), (F) all monetary obligations under any
leasing or similar arrangement which, in connection with generally accepted
accounting principles, consistently applied for the periods covered thereby, is
classified as a capital lease, (G) all indebtedness referred to in clauses (A)
through (F) above secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any mortgage,
lien, pledge, charge, security interest or other encumbrance upon or in any
property or assets (including accounts and contract rights) owned by any Person,
even though the Person which owns such assets or property has not assumed or
become liable for the payment of such indebtedness, and (H) all Contingent
Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (A) through (G) above; (y) “Contingent Obligation” means,
as to any Person, any direct or indirect liability, contingent or otherwise, of
that Person with respect to any indebtedness, lease, dividend or other
obligation of another Person if the primary purpose or intent of the Person
incurring such liability, or the primary effect thereof, is to provide assurance
to the obligee of such liability that such liability will be paid or discharged,
or that any agreements relating thereto will be complied with, or that the
holders of such liability will be protected (in whole or in part) against loss
with respect thereto; and (z) “Person” means an individual, a
limited liability company, a partnership, a joint venture, a corporation, a
trust, an unincorporated organization and a government or any department or
agency thereof.
SECURITIES
PURCHASE AGREEMENT
-9-
(m) Absence of
Litigation. There is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the
Company, threatened against or affecting the Company, the Common Stock or any of
the Company’s Subsidiaries, any of the Company’s or its Subsidiaries’ officers
or directors or the consummation of the transactions contemplated by this
Agreement and the other Transaction Documents.
(n) Employee
Relations. (i) The Company is not a party to or
bound by any collective bargaining agreements or other agreements with labor
organizations. The Company has not violated in any material respect
any laws, regulations, orders or contract terms, affecting the collective
bargaining rights of employees, labor organizations or any laws, regulations or
orders affecting employment discrimination, equal opportunity employment, or
employees’ health, safety, welfare, wages and hours.
(ii) (a) There
are no labor disputes existing, or to the Company's knowledge, threatened,
involving strikes, slow-downs, work stoppages, job actions, disputes, lockouts
or any other disruptions of or by the Company's employees, (b) there are no
unfair labor practices or petitions for election pending or, to the Company's
knowledge, threatened before the National Labor Relations Board or any other
foreign, federal, state or local labor commission relating to the Company's
employees, (c) no demand for recognition or certification heretofore made by any
labor organization or group of employees is pending with respect to the Company
and (d) to the Company's best knowledge, the Company enjoys good labor and
employee relations with its employees and labor organizations.
(o) Title. The
Company and its Subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal property, whether
tangible or intangible, owned by them which is material to the business of the
Company and its Subsidiaries, in each case free and clear of all liens,
encumbrances and defects except such as do not materially affect the value of
such property and do not interfere with the use made and proposed to be made of
such property by the Company and any of its Subsidiaries. Any real
property and facilities and personal property held under lease by the Company
and any of its Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its Subsidiaries. The Company has not granted rights to
manufacture, produce, assemble, license, market or sell its products to any
person and is not bound by any agreement that affects the Company’s exclusive
right to develop, manufacture, assemble, distribute, market or sell its
products.
SECURITIES
PURCHASE AGREEMENT
-10-
(p) Intellectual
Property. The Company and the Subsidiaries have, or have
rights to use, all trademarks, trademark applications, service marks, trade
names, copyrights, licenses and other intellectual property rights necessary or
material for use in connection with its business and which the failure to so
have could have a Material Adverse Effect (collectively, the “Intellectual Property
Rights”). Neither the Company nor any Subsidiary has received
a written notice that the use of the Intellectual Property Rights by the Company
or any Subsidiary violates or infringes upon the rights of any
Person. To the knowledge of the Company, (i) use of the Intellectual
Property Rights by the Company or any Subsidiary does not violate or infringe
upon the rights of any Person, and (ii) no third Party is infringing upon the
Intellectual Property Rights of the Company or any Subsidiary. To the
knowledge of the Company, all such Intellectual Property Rights are
enforceable.
(q) Tax
Status. The Company and each of its Subsidiaries (i) has made
or filed all foreign, federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject,
(ii) has paid all taxes and other governmental assessments and charges that are
material in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and (iii) has set aside
on its books provision reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be
due by the taxing authority of any jurisdiction, and the officers of the Company
know of no basis for any such claim. All taxes and other assessments
and levies that the Company or any Subsidiary is required to withhold or to
collect for payment have been duly withheld and collected and paid to the proper
governmental entity or third party when due. There are no tax liens
or claims pending or, to the Company’s knowledge, threatened against the Company
or any Subsidiary or any of their respective assets or
property. There are no outstanding tax sharing agreements or other
such arrangements between the Company and any Subsidiary or other corporation or
entity.
(r) Insurance. The
Company maintains insurance covering its properties and business adequate and
customary for the type and scope of the Company’s properties and business. The
Company is not in default with respect to payment of premiums on any such policy
of insurance and no claim is pending under any such policy.
(s) Dividends. The
Company has not declared or paid any dividends or authorized or made any
distribution upon or with respect to any class or series of its capital
stock.
SECURITIES
PURCHASE AGREEMENT
-11-
(t) Books and
Records. The minute books of the Company completely and
accurately reflect all material information relating to the meetings and other
corporate actions of the Company’s stockholders and the Company’s Board of
Directors and any committees thereof. The stock ledger of the Company
is complete and reflects all issuances, transfers, repurchases and cancellations
of shares of capital stock of the Company.
(u) Disclosures. The Company has
provided the Purchaser with all the information that the Purchaser has requested
for deciding whether to purchase the Common Shares, Note and
Warrant. The Company has provided the Purchaser with all material
information about the Company and its operations that the Company believes is
reasonably necessary to enable the Purchaser to decide whether to purchase the
Common Shares, Note and Warrant, other than such information relating to matters
which are not reasonably likely to have a Material Adverse
Effect. Neither this Agreement (including all schedules and exhibits
hereto), nor the other Transaction Documents (including all exhibits, annexes
and schedules thereto), nor any report, certificate or instrument furnished to
the Purchaser or its counsel in connection with the transactions contemplated by
this Agreement when read together, contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained herein or therein, in light of the circumstances under which they were
made, not misleading.
(v) Brokers. The
Company agrees to indemnify and save the Purchaser harmless from and against any
and all claims, liabilities or obligations with respect to brokerage or finders’
fees or commissions in connection with the transactions contemplated by this
Agreement asserted by any Person on the basis of any agreement, statement or
representation alleged to have been made by the Company.
(w) Material Contracts and
Obligations.
Except as contemplated by this Agreement, the Company is not a party to
any material agreement or commitment of any nature, including without limitation
(a) any agreement that requires future expenditures by the Company in excess of
$100,000, (b) any employment or consulting agreement, employee benefit, bonus,
pension, profit-sharing, stock option, stock purchase or similar plan or
arrangement, or distributor or sales representative agreement except a stock
incentive plan for 7,450,000 shares under which 5,414,000 options have been
granted, (c) any agreement with any stockholder, officer, director or Affiliate
of the Company or any of their respective immediate family members, including
without limitation any agreement or other arrangement providing for the
furnishing of services by, rental of real or personal property from, or
otherwise requiring payments to, any such Person (to the Company’s knowledge,
none of such Persons has any direct or indirect ownership interest in any firm
or corporation with which the Company is Affiliated or with which the Company
has a business relationship, or any firm or corporation that competes with the
Company, except that employees, officers, or directors of the Company and
members of their immediate families may own securities of publicly traded
companies (not to exceed two percent (2%) of such companies’ capital stock) that
may compete with the Company), (d) any agreement relating to the intellectual
property or the Company, or (e) agreements restricting or affecting the
development, manufacture or distribution of the Company’s products or
services.
SECURITIES
PURCHASE AGREEMENT
-12-
4. COVENANTS.
(a) Best
Efforts. Each party shall use its best efforts timely to
satisfy each of the conditions to be satisfied by it as provided in Sections 5
and 6 of this Agreement.
(b) Form D and Blue Sky; Form
45-106F1. The Company agrees to timely file a Form D with
respect to the Securities as required under Regulation D and to provide a copy
thereof to the Purchaser promptly after such filing. The Company
shall, on or before the Closing Date, take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for or to
qualify the Securities for sale to the Purchaser at the Closing pursuant to this
Agreement under applicable securities or “Blue Sky” laws of the states of the
United States (or to obtain an exemption from such qualification), and shall
provide evidence of any such action so taken to the Purchaser on or prior to the
Closing Date. The Company shall make all filings and reports relating
to the offer and sale of the Securities required under applicable securities or
“Blue Sky” laws of the states of the United States and Canada following the
Closing Date.
Without
limiting the generality of the foregoing, the Company agrees to file a
Form 45-106F1 with the Alberta Securities Commission as required by
National Instrument 45-106 – Prospectus and Registration Exemptions adopted by
the Canadian Securities Administrators on or before the 10th day
after the Closing Date, together with the requisite fee payable to the Alberta
Securities Commission.
(c) Fees. Except
as contemplated by the Investor Rights Agreement, each party to this Agreement
shall bear its own expenses in connection with the sale of the
Securities.
(d) Conduct of
Business. The business of the Company and its Subsidiaries
shall not be conducted in violation of any law, ordinance or regulation of any
governmental entity, except where such violations would not result, either
individually or in the aggregate, in a Material Adverse Effect.
(e) Compliance with
Laws. The Company will comply in all material respects with
all applicable laws, rules, regulations, orders and decrees of all governmental
authorities.
(f) Reservation of Common
Stock. The Company shall at all times reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of providing for the exercise of the Warrant, such number of shares
of Common Stock as shall from time to time equal the Warrant Shares issuable
upon the due exercise of the Warrant in accordance with its terms.
(g) Dividends. Until
such time as the Company has completed an initial public offering of its stock
or has a class of stock registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended, no dividend or distribution may be declared or
paid to holders of Common Stock unless approved by a majority of the Board of
Directors and by the holders of a majority of the shares of Common Stock of the
Company outstanding on the date of approval.
SECURITIES
PURCHASE AGREEMENT
-13-
(h) Agreement in Connection with
Public Offering. The Purchaser agrees, in connection with any
underwritten public offering of the Company’s securities pursuant to a
registration statement under the 1933 Act, (i) not to sell, make short sale of,
loan, grant any options for the purchase of, or otherwise dispose of any shares
of Common Stock held by the Purchaser (other than any shares included in the
offering) without the prior written consent of the Company or the underwriters
managing such underwritten public offering of the Company’s securities for a
period of 180 days from the effective date of such registration statement, and
(ii) to execute any agreement reflecting clause (i) above as may be requested by
the Company or the managing underwriters at the time of such offering; provided, however, that
Purchaser shall not be so obligated (under either clause (i) or (ii)) in
connection with any such offering unless all officers, directors and 10%
stockholders of the Company undertake similar, and not less onerous, obligations
in connection with the same offering.
5. CONDITIONS TO THE COMPANY’S
OBLIGATION TO SELL.
The
obligation of the Company hereunder to issue and sell the Common Shares, the
Note and the Warrant to the Purchaser at the Closing is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for the Company’s sole benefit
and may be waived by the Company at any time in its sole discretion by providing
the Purchaser with prior written notice thereof:
(i) The
Purchaser shall have executed this Agreement and each of the other Transaction
Documents to which it is a party and delivered the same to the
Company.
(ii) The
Purchaser shall have delivered to the Company, the Purchase Price by wire
transfer of immediately available funds.
(iii) The
representations and warranties of the Purchaser shall be true and correct in all
material respects as of the date when made and as of the Closing Date as though
made at that time (except for representations and warranties that speak as of a
specific date), and the Purchaser shall have performed, satisfied and complied
in all material respects with the covenants, agreements and conditions required
by this Agreement to be performed, satisfied or complied with by the Purchaser
at or prior to the Closing Date.
6. CONDITIONS TO THE
PURCHASER’S OBLIGATION TO PURCHASE.
The
obligation of the Purchaser hereunder to purchase the Common Shares, the
Note and the
Warrant at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are
for the Purchaser’s sole benefit and may be waived by the Purchaser at any time
in its sole discretion by providing the Company with prior written notice
thereof:
(i) The
Company shall have executed and delivered to the Purchaser (A) this
Agreement and each of the other Transaction Documents, (B) the Note, and
(C) the Warrant (in such amounts as the Purchaser shall request) being
purchased by the Purchaser at the Closing pursuant to this
Agreement.
SECURITIES
PURCHASE AGREEMENT
-14-
(ii) The
representations and warranties of the Company shall be true and correct as of
the date when made and as of the Closing Date and the Company shall have
performed, satisfied and complied in all respects with the covenants, agreements
and conditions required by this Agreement and the other Transaction Documents to
be performed, satisfied or complied with by the Company at or prior to the
Closing Date.
(iii) The
Company shall have obtained all governmental, regulatory or third party consents
and approvals, if any, necessary or appropriate for the sale of the Securities,
and the same shall be effective as of the Closing Date, except for post-closing
securities filings or notifications required to be made under federal, state or
provincial securities laws.
(iv) No
judgment, writ, order, injunction, award or decree of or by any court, or judge,
justice or magistrate, including any bankruptcy court or judge, or any order of
or by any governmental authority, shall have been issued, and no action or
proceeding shall have been instituted by any governmental authority, enjoining
or preventing the consummation of the transactions contemplated hereby or by the
other Transaction Documents.
(v) The
results of the Purchaser’s due diligence investigations shall have been
satisfactory to the Purchaser.
7. TERMINATION. In
the event that the Closing shall not have occurred on or before five (5)
Business Days from the date hereof due to the Company’s or the Purchaser’s
failure to satisfy the conditions set forth in Sections 5 and 6 above (and the
nonbreaching party’s failure to waive such unsatisfied condition(s)), the
nonbreaching party shall have the option to terminate this Agreement with
respect to such breaching party at the close of business on such date without
liability of any party to any other party. Nothing in this Section 7
shall be deemed to release any party from any liability for any breach by such
party of the terms and provisions of this Agreement or the other Transaction
Documents or to impair the right of any party to compel specific performance by
any other party of its obligations under this Agreement or the other Transaction
Documents.
8. MISCELLANEOUS.
(a) Governing Law; Consent to
Jurisdiction; Waiver of Jury Trial. This Agreement shall be
governed by, and construed in accordance with, the internal laws of the State of
California without regard to the choice of law principles
thereof. Each of the parties hereto irrevocably submits to the
exclusive jurisdiction of the courts of the State of California located in Los
Angeles County and the United States District Court for the Central District of
California for the purpose of any suit, action, proceeding or judgment relating
to or arising out of this Agreement and the transactions contemplated
hereby. Service of process in connection with any such suit, action
or proceeding may be served on each party hereto anywhere in the world by the
same methods as are specified for the giving of notices under this
Agreement. Each of the parties hereto irrevocably consents to the
jurisdiction of any such court in any such suit, action or proceeding and to the
laying of venue in such court. Each party hereto irrevocably waives
any objection to the laying of venue of any such suit, action or proceeding
brought in such courts and irrevocably waives any claim that any such suit,
action or proceeding brought in any such court has been brought in an
inconvenient forum. EACH OF THE
PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION
WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED
SPECIFICALLY AS TO THIS WAIVER.
SECURITIES
PURCHASE AGREEMENT
-15-
(b) Counterparts. This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall
be binding upon the signatory thereto with the same force and effect as if the
signature were an original, not a facsimile signature.
(c) Headings. The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.
(d) Severability. If
any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of any provision of this Agreement in any other
jurisdiction.
(e) Entire Agreement;
Amendments. This Agreement and the other Transaction Documents
supersede all other prior oral or written agreements between the Purchaser, the
Company, their Affiliates and Persons acting on their behalf with respect to the
matters discussed herein and therein, and this Agreement, the other Transaction
Documents and the instruments referenced herein contain the entire understanding
of the parties with respect to the matters covered herein and therein and,
except as specifically set forth herein or therein, neither the Company nor any
Purchaser makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be
amended other than by an instrument in writing signed by the Company and the
Purchaser. No provision hereof may be waived other than by an
instrument in writing signed by the party against whom enforcement is
sought. No such amendment shall be effective to the extent that it
applies to less than all of the holders of the applicable Securities then
outstanding.
(f) Notices. Any
notices, consents, waivers or other communications required or permitted to be
given under the terms of this Agreement must be in writing and will be deemed to
have been delivered: (i) upon receipt, when delivered personally;
(ii) upon receipt, when sent by facsimile (provided confirmation of transmission
is mechanically or electronically generated and kept on file by the sending
party); or (iii) one Business Day after deposit with an overnight courier
service, in each case properly addressed to the party to receive the
same. The addresses and facsimile numbers for such communications
shall be:
If to the
Company:
0000
Xxxxxx Xxx.
Xxxxx
Xxxx, Xxxxxxxxxx 00000
Telephone:(000)
000-0000
Facsimile:(000)
000-0000
Attention:Chief
Executive Officer
SECURITIES
PURCHASE AGREEMENT
-16-
With a copy to:
Xxxxxxxxxx
& Xxxxx, LLP
00000
Xxxxxxxx Xxxx., Xxxxx 000
Xxx
Xxxxxxx, Xxxxxxxxxx 00000
Telephone:(000)
000-0000
Facsimile:(000)
000-0000
Attention: Xxxxx
Xxxxx, Esq.
If to a Purchaser or
Purchaser:
Immersive
Media Corp.
0000 XX
00xx Xxxxxx
Xxxxxxxx,
Xxxxxx 00000
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Chief Executive Officer
With a copy (for informational
purposes only) to:
Xxxxxx
& Xxxxxxx LLP
Xxxxx
0000, 000 Xxxxxxxx Xxxxxx
Xxxxxxxxx,
X.X. X0X 0X0
Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxxxx X. Xxxxxx, Esq.
And a copy (for informational
purposes only) to:
Burnet,
Xxxxxxxxx & Xxxxxx LLP
Suite
1400, 350 – 0xx Xxxxxx
X.X.
Xxxxxxx,
Xxxxxxx X0X 0X0
Xxxxxx
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxxxxx X. Xxx, Esq.
or to
such other address and/or facsimile number and/or to the attention of such other
Person as the recipient party has specified by written notice given to each
other party five (5) Business Days prior to the effectiveness of such
change. Written confirmation of receipt (A) given by the recipient of
such notice, consent, waiver or other communication, (B) mechanically or
electronically generated by the sender’s facsimile machine containing the time,
date, recipient facsimile number and an image of the first page of such
transmission or (C) provided by an overnight courier service shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above,
respectively.
SECURITIES
PURCHASE AGREEMENT
-17-
(g) Successors and
Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns.
(h) No Third Party
Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.
(i) Survival. The
representations and warranties of the Company and the Purchaser contained in
Sections 2 and 3 and the agreements and covenants set forth in Sections 4 and 8
shall survive the Closing.
(j) Further
Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
any other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(k) No Strict
Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any
party.
(l) Publicity. Except
as set forth below, no public release or announcement concerning the
transactions contemplated hereby shall be issued by the Company or the Purchaser
without the prior consent of the Company (in the case of a release or
announcement by the Purchaser) or the Purchaser (in the case of a release or
announcement by the Company) (which consents shall not be unreasonably
withheld), except as such release or announcement may be required by law or the
applicable rules or regulations of any securities exchange or securities market,
in which case the Company or the Purchaser, as the case may be, shall allow the
Purchaser or the Company, as applicable, to the extent reasonably practicable in
the circumstances, reasonable time to comment on such release or announcement in
advance of such issuance. All such releases shall comply with
applicable “safe harbor” requirements of the 1933 Act. For certainty,
the Company acknowledges that the Purchaser is required by Canadian securities
laws to issue a news release promptly following the Closing, and the Company
hereby consents to such release substantially in the form attached hereto as
Exhibit E.
[Signature Page
Follows]
SECURITIES
PURCHASE AGREEMENT
-18-
IN
WITNESS WHEREOF, the Purchaser and the Company have caused their respective
signature page to this Securities Purchase Agreement to be duly executed as of
the date first written above.
| Company: | |||
| T3 MOTION, INC. | |||
|
|
By:
|
/s/ | |
| Ki Nam | |||
|
Chief
Executive Officer
|
|||
| IMMERSIVE MEDIA CORP. | |||
|
|
By:
|
/s/ | |
| Name | |||
|
Chief
Executive Officer
|
|||
SIGNATURE
PAGE TO SECURITIES PURCHASE AGREEMENT
-19-
EXHIBITS
| Exhibit A | Form of Note | ||
| Exhibit B | Form of Warrant | ||
| Exhibit C | Form of Investor Rights Agreement | ||
| Exhibit D | Accredited Investor Definition | ||
| Exhibit D | Form of News Release |
SECURITIES
PURCHASE AGREEMENT
|
|
EXHIBIT
D
|
An
“accredited investor”, as defined in Rule 501(a) of Regulation D under the
United States Securities Act of 1933, as amended, includes any person who comes
within any of the following categories at the time of the sale of the securities
to that person:
|
Category
1.
|
A
bank, as defined in Section 3(a)(2) of the 1933 Act, whether acting in its
individual or fiduciary capacity; or
|
|
Category
2.
|
A
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the 1933 Act, whether acting in its individual or fiduciary
capacity; or
|
|
Category
3.
|
A
broker or dealer registered pursuant to Section 15 of the United States
Securities Exchange Act
of 1934, as amended; or
|
|
Category
4.
|
An
insurance company as defined in Section 2(13) of the 1933 Act;
or
|
|
Category
5.
|
An
investment company registered under the United States Investment Company Act of
1940; or
|
|
Category
6.
|
A
business development company as defined in Section 2(a)(48) of the United
States Investment
Company Act of 1940; or
|
|
Category
7.
|
A
small business investment company licensed by the U.S. Small Business
Administration under Section 301 (c) or (d) of the United States Small Business Investment Act
of 1958; or
|
|
Category
8.
|
A
plan established and maintained by a state, its political subdivisions or
any agency or instrumentality of a state or its political subdivisions,
for the benefit of its employees, with total assets in excess of U.S.
$5,000,000; or
|
|
Category
9.
|
An
employee benefit plan within the meaning of the United States Employee Retirement Income
Security Act of 1974 in which the investment decision is made by a
plan fiduciary, as defined in Section 3(21) of such Act, which is either a
bank, savings and loan association, insurance company or registered
investment adviser, or an employee benefit plan with total assets in
excess of U.S. $5,000,000 or, if a self-directed plan, with investment
decisions made solely by persons who are accredited investors;
or
|
|
Category
10.
|
A
private business development company as defined in Section 202(a)(22) of
the United States Investment Advisers Act of
1940; or
|
|
Category
11.
|
An
organization described in Section 501(c)(3) of the United States Internal Revenue Code,
a corporation, a Massachusetts or similar business trust, or a
partnership, not formed for the specific purpose of acquiring the
securities offered, with total assets in excess of U.S. $5,000,000;
or
|
|
Category
12.
|
Any
director or executive officer of the Corporation; or
|
|
Category
13.
|
A
natural person whose individual net worth, or joint net worth with that
person’s spouse, at the date hereof exceeds U.S. $1,000,000;
or
|
|
Category
14.
|
A
natural person who had an individual income in excess of U.S. $200,000 in
each of the two most recent years or joint income with that person’s
spouse in excess of U.S. $300,000 in each of those years and has a
reasonable expectation of reaching the same income level in the current
year; or
|
|
Category
15.
|
A
trust, with total assets in excess of U.S. $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as described in Rule 506(b)(2)(ii)
under the 1933 Act; or
|
|
Category
16.
|
Any
entity in which all of the equity owners meet the requirements of at least
one of the above categories.
|
4850-0101-6066\1
12/28/2007 10:08 PM
