--------------------------------------------------------------------------------
EXHIBIT 10.9
HYBRID FAX, INC.
-----------------------------
STOCK AND WARRANT PURCHASE AGREEMENT
Dated as of August 31, 1988
-----------------------------
For the Purchase of
299,995 Shares of Series A Preferred Stock
and
Warrants to Purchase 75,009 Shares of Common Stock
--------------------------------------------------------------------------------
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
--------------------------------------------------------------------
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA WITHOUT GIVING EFFECT TO THE
--------------------------------------------------------------------------------
CONFLICT OF LAWS PROVISIONS THEREOF.
------------------------------------
Stock and Warrant Purchase Agreement
HYBRID FAX, INC.
Dated as of August 31, 1988
Hybrid Fax, Inc., a Delaware corporation (the "Company"), each of the
purchasers listed in Schedule I hereto (the "Purchasers") and First Stage
Partners, a Texas general partnership whose partners consist of the Purchasers
(the "Partnership") have entered into this Agreement for the purpose of the
Purchasers purchasing, and the Company issuing, certain shares of the Company's
Series A Preferred Stock and certain warrants to purchase common stock of the
Company.
1. Authorization of the Securities. The Company has duly authorized the
-------------------------------
issuance and sale of (a) up to 400,000 shares of the Company's Series A
Preferred Stock (the "Preferred") par value $.01 per share, and (b) up to
100,000 warrants (the "Warrants") entitling the holders thereof to purchase, on
certain terms and conditions, an aggregate of 100,000 shares of common stock of
the Company, par value $.01 per share (the "Common Stock"), at an initial
purchase price of $1.50 per share, subject to adjustment as provided in the
Warrants. Shares of Preferred and Warrants shall be issued at the Closing
provided for in Section 3 hereof in Units (the "Units"), each Unit consisting of
four shares of Preferred and one Warrant to purchase one share of Common Stock.
Subscriptions have been rounded as to the number of shares and Warrants as
provided in Schedule I. The Preferred shall have the designations, powers,
preferences and relative and other special rights and the qualifications,
limitations and restrictions set forth in the Certificate of Designation (the
"Certificate of Designation") of the Company in the form attached hereto as
Exhibit A. The Preferred shall, upon the terms and conditions set forth in the
Certificate of Designation, be convertible into shares of Common Stock of the
Company at an initial conversion rate of one share for one share, subject to
adjustment as provided in the Certificate of Designation. The Warrants shall
have such terms and conditions of exercise as are set forth in the Warrant
Agreement dated the date hereof between the Company, the Purchasers and the
Partnership which is substantially in the form provided to each of the
Purchasers (the "Warrant Agreement").
2. Purchase and Sale of the Units.
------------------------------
(a) Each Purchaser has executed and delivered to the Company, and the
Company has accepted, a Subscription Agreement and Power of Attorney (the
"Subscription Agreement") pursuant to which such Purchaser has subscribed for
the purchase of a number of shares of Preferred and Warrants in the amounts set
forth opposite such Purchaser's name in Schedule I hereto. An amount equal to
one-half of the purchase price has been paid in to the Company by the Purchasers
upon the acceptance of the Subscription Agreement. Subject to the terms and
conditions of this Agreement
-2-
and the Subscription Agreement, the Company shall issue and sell to the
Purchasers and each Purchaser shall purchase from the Company, at the Closing
(as defined below), the number of Units specified opposite the Purchaser's name
in Schedule I hereof (the "Purchaser Units") for a purchase price of $3.00 per
Unit in cash.
(b) The Purchaser Units shall be evidenced by Preferred stock certificates
and a Warrant Certificate in the form provided for in the Warrant Agreement.
Each Purchaser Unit or fraction thereof will contain only whole numbers of
shares of Preferred. Exact amounts of shares and Warrants to be issued to the
Purchasers has been rounded to the whole numbers of each as set forth in
Schedule I hereto.
3. Closing.
-------
(a) The closing of the sale and purchase of the Purchaser Units (the
"Closing") to be purchased by the Purchasers shall take place at the offices of
the Company in Brisbane, California at 11:00 a.m. on August 31, 1988, or on such
other business day on or prior to September 21, 1988.
(b) At the Closing, each Purchaser shall deliver the balance of the
purchase price owing on the Purchaser Units, which payment shall be made in
personal or cashier's check or wire transfer to the account of the Company. The
failure of any Purchaser to deliver the balance of his purchase price shall not
effect the obligations of the Company, the Partnership and the remaining
Purchasers to consummate the Closing provided that the aggregate purchase price
for the sale of all Purchaser Units shall equal or exceed $150,000.
(c) If the Closing fails to occur on or before September 15, 1988, each of
the Purchaser and the Company shall, at its election and notwithstanding
anything to the contrary contained in this Agreement, be relieved of all further
obligations under this Agreement, and all funds paid to the Company by the
Purchasers shall be returned to the Purchasers without interest.
(d) At the Closing, each Purchaser shall, upon issuance by the Company,
contribute the shares of Preferred and Warrants purchased by such Purchaser to
the Partnership in accordance with Section 4.2(a) of the Agreement of
Partnership of the Partnership dated as of the date hereof which is
substantially in the form provided to each of the Purchasers. By execution of
this Agreement, each Purchaser hereby assigns and conveys, effective at Closing,
all right, title and interest in the Purchaser Units to the Partnership.
(e) At the Closing, the Company will deliver the shares of Preferred and
Warrants purchased hereby by each of the Purchasers by delivering to the
Partnership, on behalf of each Purchaser, a single Preferred Stock Certificate
and a single Warrant Certificate each dated the Closing Date (as defined above)
and registered in the name of Xxxxxxx X. Xxxx, as trustee for the Partnership,
against delivery to the Company of the balance of purchase price therefor as
provided
-3-
in Section 2(b) hereof. The Partnership shall accept the Certificates at Closing
on behalf of the Purchaser.
(f) By delivering payment for the remainder of the purchase price for the
Purchaser Units, each Purchaser shall be deemed to have confirmed as of the
Closing Date that the representations and warranties made by it in Section 7 of
this Agreement and in the Subscription Agreement remain accurate in all material
respects as of the Closing Date and that such Purchaser has performed all of its
obligations to be performed under this Agreement and the Subscription Agreement
on or prior to the Closing Date.
4. Conditions to Purchase. The obligation of the Purchaser to purchase
----------------------
and pay for the Purchaser Units at the Closing shall be subject to the
fulfillment, or the waiver by the Purchaser, prior to or at the Closing, of the
following conditions:
(a) all representations and warranties and other statements of the Company
herein shall be, at and as of the Closing Date, after giving effect to the
transactions contemplated by this Agreement, true and correct in all material
respects;
(b) the Company shall have performed and complied with all of its
obligations and conditions hereunder to be performed on or prior to the Closing
Date in all material respects;
(c) the Company shall have furnished or caused to be furnished to the
Purchaser a certificate, dated the Closing Date and signed by one of its senior
officers as to the fulfillment of the conditions set forth in clauses (a) and
(b) of this Section 4;
(d) the Company shall have entered into a definitive technology transfer
agreement (the "Technology Agreement") with Xxx X. Xxxxx in a form satisfactory
with the Company and its counsel;
(e) the Company shall have entered into definitive stock purchase
agreements (the "Employee Stock Agreements") with each of Xxxxxx X. Xxxxxx III,
Xxx X. Xxxxx, Xxxxx X. Xxxxxx and Xxxx Xxxxx on terms substantially as described
in the Business Plan and the Supplemental Business Plan (as defined in the
Subscription Agreements) and in a form satisfactory to the Administrative
Partners of the Partnership;
(f) the Company shall have received prior to the Closing pursuant to this
Agreement and the several Subscription Agreements executed and delivered by each
of the Purchasers ("Subscription Agreement") cash gross proceeds from the
issuance of the Purchaser Units of at least $150,000; and
-4-
(g) each Purchaser shall have been furnished with the favorable opinion,
dated the Closing Date and addressed to the Purchaser from Xxxxxxx & Xxxxx,
counsel for the Company, in form and substance satisfactory to the
Administrative Partners of the Partnership.
5. Conditions to Sale. The obligation of the Company to issue and sell
------------------
the Purchaser Units to the Purchaser at the Closing shall be subject to the
fulfillment, or the waiver by the Company, prior to or at the Closing, of the
following conditions:
(a) all representations and warranties and other statements of the
Purchaser herein and in the Subscription Agreement shall be, at and as of the
Closing Date, after giving effect to the transactions contemplated by this
Agreement, true and correct in all material respects; and
(b) the Purchaser shall have performed and complied with all of its
obligations and conditions hereunder to be performed on or prior to the Closing
Date in all material respect.
6. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows:
(a) The Company has been duly incorporated and organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and has all requisite corporate power and authority to own its
properties and conduct its business as described in the Business Plan (as
defined in the Subscription Agreement); the Company has been (or at the Closing
Date will be) duly qualified as a foreign corporation for the transaction of
business and is (or at the Closing Date will be) in good standing, under the
laws of each other jurisdiction in which the Company owns or leases properties,
or conducts any business so as to require such qualification, other than where
the failure to be so qualified or in good standing would not have a material
adverse effect on the Company. The Company has heretofore delivered or prior to
the Closing will deliver to the Purchaser a substantially complete and correct
copy of, and the Company has all requisite corporate power and authority to
enter into and perform all of its obligations under, this Agreement, the
Subscription Agreements, the Certificate of Designation (as fled with the
Secretary of State of the State of Delaware and the Warrant Agreement together
with any exhibits, schedules or attachments thereto (collectively, the
"Documents").
(b) All of the Common Stock of the Company outstanding as of the date
hereof has been, and all of the Common Stock and Preferred of the Company
outstanding on the Closing Date will be, duly and validly authorized and issued,
fully paid and non-assessable; the authorized capital stock of the Company
immediately prior to the Closing will consist of: (i) 5,000,000 shares of Common
Stock, par value $.01 per share, of which 200,000 shares will be issued and
outstanding and (ii) 3,000,000 shares of Preferred Stock, par value $.01 per
share, of which no shares will be issued and outstanding. Except (i) for up to
200,000 shares of Common Stock reserved or available for sale to certain future
employees, officers, consultants and directors of the Company, (ii) 690,000
shares of Common Stock issued or to be issued pursuant to the Employee Stock
Agreements, and
-5-
(iii) as provided for in the Certificate of Designation and in the Warrant
Agreement, (a) there are no outstanding subscriptions, warrants, options, calls
or commitments of any character relating to or entitling any person to purchase
or otherwise acquire from the Company any capital stock of the Company, (b)
there are no obligations or securities convertible into or exchangeable for any
shares of capital stock of the Company or any commitments of any character
relating to or entitling any person to purchase or otherwise acquire any such
obligations or securities; (c) there are no preemptive or similar rights to
subscribe for or to purchase any capital stock of the Company; and (d) the
Company has not entered into any agreement to register its equity or debt
securities under the Securities Act of 1933 as amended (the "Securities Act");
(c) The execution, delivery and performance by the Company of this
Agreement and the Documents and the consummation by the Company of the
transactions contemplated thereby have been or, prior to the Closing Date will
be, duly authorized by all necessary corporate action on the part of the
Company; this Agreement has been duly executed and delivered by the Company and
is a valid and binding agreement of the Company, enforceable against the Company
in accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors' rights generally, and except as enforcement thereof is
subject to general principles of equity (whether applied in a proceeding at law
or in equity and except that enforcement of any indemnification and provisions
contained in such Documents may be limited or denied on the basis of federal or
applicable state securities laws and the public policies underlying such laws.;
the Preferred and Warrants have been duly authorized by the Company for issuance
and sale pursuant to this Agreement, the Certificate of Designation and the
Warrant Agreement and, upon the issuance thereof in accordance with this
Agreement, and in the case of the Preferred, the Certificate of Designation,
and, in the case of the Warrants, the Warrant Agreement, will be entitled to the
benefits of the Certificate of Designation and the Warrant Agreement and the
related certificates;
(d) The issue and sale of the Preferred and Warrants hereunder on the
Closing Date and the execution and delivery of, and the compliance by the
Company with all of the provisions of this Agreement such Preferred and
Warrants, the Certificate of Designation and the Warrant Agreement and the
consummation of the transactions herein and therein contemplated will not result
in a breach or violation of any of the terms or provisions off or constitute a
default under, or result in the creation of any lien in respect of any property
or assets of the Company under, the Certificate of Incorporation or By-Laws of
the Company, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the Company
is bound, or any statute or law to which the Company or any of its properties
are subject or any order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of its properties; and,
assuming the accuracy in all material respects of the representations of the
Purchaser set forth in Section 7 hereof, no consent, approval, authorization,
order, registration or qualification of or with any such court or governmental
agency or body is required for validity of the execution and delivery of or for
the performance by the Company of this Agreement or the Warrant Agreement, the
issue and sale of the Preferred and Warrants constituting
-6-
the Purchaser Units or the placement of the Purchaser Units or the consummation
by the Company of the other transactions contemplated by this Agreement, the
Preferred and Warrants constituting the Purchaser Units, the Certificate of
Designation or the Warrant Agreement, except such as may be required under state
securities or Blue Sky laws in connection with the placement of the Units and
except such as may be required under the Securities Act and such state
securities or Blue Sky laws in connection with subsequent resales by purchasers
in such placement;
(e) There are no legal or governmental proceedings pending to which the
Company is a party or of which any of its properties is the subject, or which
challenge the validity or legality of this Agreement, the other Documents or the
transactions contemplated hereby or thereby; and, to the best of the Company's
knowledge, no such proceedings are threatened by governmental authorities or by
any other persons; and
(f) On the Closing Date, the Company will not be in violation of any
statutes, laws, ordinances, governmental rules or regulations or any judgment,
order or decree (federal, state, local or foreign) to which it is subject or
have failed to obtain any licenses, permits, franchises or other governmental
authorizations necessary to the ownership or operation of its properties or the
conduct of its business (including, without limitation, matters relating to
environmental laws or regulations), except for such violations and failures to
obtain such licenses, permits, franchises or other governmental authorizations
that would not, individually or in the aggregate, have a material adverse effect
on the business, results of operations or financial condition of the Company
(whether because such license, permit, franchise or other governmental
authorization will be obtained within a reasonable time after the Closing Date
or otherwise)
7. Representations and Warranties of the Purchasers.
------------------------------------------------
Each Purchaser severally represents the following to the Company and the
Partnership:
(a) Each Purchaser has full power and authority to enter into this
Agreement, the Subscription Agreement, the Warrant Agreement and the Partnership
Agreement, and to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. Each of the
Agreement, the Subscription Agreement, the Warrant Agreement and the Partnership
Agreement and the transactions contemplated hereby and thereby have been duly
authorized by all necessary action on the part of each Purchaser, and each of
this Agreement, the Subscription Agreement, the Warrant Agreement, and the
Partnership Agreement is a legal, valid and binding obligation of such
Purchaser, enforceable against the purchaser in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforcement of creditors'
rights generally, and except as enforcement thereof is subject to general
principles of equity (whether applied in a proceeding at law or in equity), and
except that enforcement of the indemnification and contribution provisions of
this Agreement may be limited or denied on the basis of federal or applicable
state securities laws and the public policies underlying such laws.
-7-
(b) Each Purchaser and, if he has engaged one, Purchaser Representative
(as defined in the Subscription Agreement) have been furnished, prior to the
date hereof, a copy of the Offering Documents (as defined in the Subscription
Agreement), (ii) the Company has made available to the Purchaser and his
Purchaser Representative (if any) the opportunity to ask questions of, receive
answers and to obtain any additional information necessary to verify the
accuracy of the information set forth in the Offering Documents, and the
Purchaser and his Purchaser Representative (if any) did receive all such
information from the Company concerning the terms and conditions of the offering
and (iii) each Purchaser and his Purchaser Representative (if any) together have
such knowledge and experience in financial and business matters necessary to be
able to analyze the merits and risks of this investment.
(c) The Purchaser recognizes that an investment in the Company is a
speculative investment involving a high degree of risk.
(d) Each Purchaser has adequate net worth and means of providing for
current needs and possible personal contingencies, and has no need, and
anticipates no need in the foreseeable future, to sell the Preferred and
Warrants (or the Common Stock issuable upon exercise or conversion) for which
such Purchaser hereby subscribes. Each Purchaser is able to bear the economic
risk of this investment and, consequently, without limiting the generality of
the foregoing, is able to hold the Preferred and Warrants (and the Common Stock
issuable upon conversion or exercise) for an indefinite period of time and has a
sufficient net worth to sustain a loss of the entire investment in the Company
in the event such loss should occur.
(e) Each Purchaser is acquiring the Preferred and Warrants for his own
account for investment and not for the benefit of any other person or with a
view toward resale or redistribution in a manner which would require
registration under the 1933 Act, and such Purchaser does not now have any reason
to anticipate any change in circumstances or other particular occasion or event
which would cause such Purchaser to sell the Preferred and Warrants (or the
Common Stock issuable upon conversion or exercise).
(f) Each Purchaser received no representations or warranties (other than
any contained in this Agreement) from the Company or its employees or agents, or
any other person and, in making my investment decision, and such Purchaser is
relying solely on the information contained in the Offering Documents and
investigations made by such Purchaser or (if applicable) his Purchaser
Representative.
(g) Each Purchaser acknowledges that there are substantial restrictions on
the transferability of the Preferred and Warrants (and the Common Stock issuable
upon the conversion or exercise thereof). Since the Preferred and Warrants (and
the Common Stock issuable upon conversion or exercise thereof) will not be, and
the Purchaser has no right to require that they be, registered under the 1933
Act or qualified pursuant to applicable state securities law (except as provided
in this Agreement), the Preferred and Warrants (and the Common Stock issuable
upon
-8-
conversion or exercise thereof) may not be, and each Purchaser agrees that
they shall not be, sold unless such sale is exempt from such registration under
the 1933 Act, the Securities Act of Texas and any other applicable state Blue
Sky law or regulation. Each Purchaser further acknowledges that the Company is
under no obligation to aid me in obtaining any exemption from the registration
requirements. Each Purchaser acknowledges that such Purchaser shall be
responsible for compliance with all conditions on transfer imposed by any
securities administrator of any state and for any expenses incurred by the
Company for legal or accounting services in connection with reviewing such a
proposed transfer and/or issuing opinions in connection therewith.
8. Registration Rights.
-------------------
8.1 Requested Registration.
----------------------
(a) Request for Registration. In case the Company shall receive from
------------------------
Holders of 50% of the issued or issuable Registrable Securities the "Initiating
Holders") a written request that the Company effect a registration under the
Securities Act of 1933, as amended (the "Securities Act") with respect to not
less than a number of shares (as adjusted for recapitalizations) of Registrable
Securities, sufficient (when aggregated with the offering of other holders who
have similar registration rights who have so requested registration) so that the
net proceeds of a proposed offering of such shares would be reasonably estimated
to exceed $3,000,000, the Company will (i) promptly give written notice of the
proposed registration, qualification or compliance to all other Holders and (ii)
as soon as practicable, use its best efforts to effect such registration
(including, without limitation, appropriate qualification under Blue Sky or
other state securities laws and appropriate compliance with applicable
regulations issued under the Securities Act and any other governmental
requirements or regulations) as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Registrable
Securities as are specified in such request, together with all or such portion
of the Registrable Securities of any Holder or Holders joining in such request
as are specified in a written request received by the Company within 20 days
after receipt of such written notice from the Company; provided, however, that
the Company shall not be obligated to take any action to effect any such
registration, qualification or compliance pursuant to this Section 8.1:
(A) In any particular jurisdiction in which the Company would be
required to execute a general consent to service of process in effecting
such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be
required by the Securities Act; (B) Prior to the earlier of (i) December
31, 1992, or (ii) six months - after the effective date of the Company's
first registered public offering of its stock;
(C) If the Company receives an opinion of counsel, reasonably
satisfactory to a majority of the requesting Holders, to the effect that
the Holders can make open market sales of the outstanding Common Stock held
by them without registration, subject to the volume
-9-
and manner of sale limitations contained in Rule 144 promulgated by the
Securities and Exchange Commission or such similar exemption from
registration requirements of the Act;
(D) During the period starting with the date sixty (60) days prior
to the Company's estimated date of filing of, and ending on the date six
(6) months immediately following the effective date of, any registration
statement pertaining to securities of the Company (other than a
registration of securities in a Rule 145 transaction or with respect to an
employee benefit plan), provided that the Company is actively employing in
good faith all reasonable efforts to cause such registration statement to
become effective;
(E) After the Company has effected two such registrations pursuant to
this paragraph 8.1(a), and such registrations have been declared or ordered
effective; or
(F) If the Company shall furnish to such Holders a certificate signed
by the President of the Company stating that in the good faith judgment of
the Board of Directors of the Company it would be seriously detrimental to
the Company or its shareholders for a registration statement to be filed in
the near future, in which case the Company's obligation to use its best
efforts to register, qualify or comply under this Section 8.1 shall be
deferred for a period not to exceed 120 days from the date of receipt of
the written request from the Initiating Holders.
Subject to the foregoing clauses (A) through (F), the Company shall file a
registration statement covering the Registrable Securities so requested to be
registered as soon as practicable after receipt of the request or requests of
the Initiating Holders.
(b) Underwriting. In the event that a registration pursuant to this
------------
Section 8.1 is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as part of the notice given pursuant to
Section 8.1(a)(i). In such event, the right of any Holder to registration
pursuant to this Section 8.1 shall be conditioned upon such Holder's
participation in the underwriting arrangements required by this Section 8.1, and
the inclusion of such Holder's Registrable Securities in the underwriting to the
extent requested shall be limited as provided herein. The Company shall
(together with all Holders proposing to distribute their securities through such
underwriting) enter into an underwriting agreement in customary form with the
managing underwriter(s) selected for such underwriting by a majority in interest
of the Initiating Holders, but subject to the Company's reasonable approval.
Notwithstanding any other provision of this Section 8.1, if the managing
underwriter(s) advise(s) the Initiating Holders in writing that marketing
factors require a limitation of the number of shares to be underwritten, then
the Company shall so advise all Holders participating and the number of shares
of Registrable Securities that may be included in the registration and
underwriting shall be allocated among all Holders thereof in proportion, as
nearly as practicable, to the respective amounts of Registrable Securities held
by such Holders at the time of filing the registration statement. No Registrable
Securities excluded from the underwriting by reason of the underwriters'
marketing limitation shall be included in such registration. To
-10-
facilitate the allocation of shares in accordance with the above provisions, the
Company or the underwriters may round the number of shares allocated to any
Holder to the nearest 100 shares. If any Holder disapproves of the terms of the
underwriting, such person may elect to withdraw therefrom by written notice to
the Company, the managing underwriter and the Initiating Holders. The
Registrable Securities so withdrawn shall also be withdrawn from registration,
and such Registrable Securities shall not be transferred in a public
distribution prior to 90 days after the effective date of such registration, or
such other shorter period of time as the underwriters may require.
8.2 Registration Form S-3.
---------------------
(a) If any Holder or Holders holding in the aggregate not less than. 15%
of the aggregate number of shares of outstanding Preferred and Common Stock
issued upon the conversion of the Preferred request that the Company file a
registration statement on Form S-3 (or any successor form to Form S-3) for a
public offering of the Registrable Securities the reasonably anticipated
aggregate price to the public of which, net of underwriting discounts and
commissions, would exceed $500,000, and the Company is then entitled to use Form
S-3 under applicable Commission rules to register the Registrable Securities for
such an offering, the Company shall use its best efforts to cause such
Registrable Securities to be registered for the offering on such form and to
cause such Registrable Securities to be qualified in such jurisdictions as the
Holder or Holders may reasonably request; provided, however, that the Company
shall not be required to effect more than one registration pursuant to this
Section 8.3 in any six month period. The substantive provisions of Section 8.5
shall be applicable to each registration initiated under this Section 8.3.
(b) Notwithstanding the foregoing, the Company shall not be obligated to
take any action pursuant to this Section 8.3: (i) in any particular jurisdiction
in which the Company would be required to execute a general consent to service
of process in effecting such registration, qualification or compliance unless
the Company is already subject to service in such jurisdiction and except as may
be required by the Securities Act; (ii) if the Company, within ten (10) days of
the receipt of the request of the Initiating Holders, gives notice of its bona
fide intention to effect the filing of a registration statement with the
Commission within ninety (90) days of receipt of such request (other than with
respect to a registration statement relating to Rule 145 transaction, an
offering solely to employees or any other registration which is not appropriate
for the registration of Registrable Securities); (iii) during the period
starting with the date sixty (60) days prior to the Company's estimated date of
filing of, and ending on the date six (6) months immediately following, the
effective date of any registration statement pertaining to securities of the
Company (other than a registration of securities in a Rule 145 transaction or
with respect to an employee benefit plan), provided that the Company is actively
employing in good faith all reasonable efforts to cause such registration
statement to become effective; or (iv) if the Company shall furnish to such
Holder a certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors it would be seriously detrimental
to the Company or its shareholders for registration statements to be filed in
the near future, then the Company's obligation to use its best
-11-
efforts to file a registration statement shall be deferred for a period not to
exceed 120 days from the receipt of the request to file such registration by
such Holder.
8.3 Optional Registrations. If at any time or times after the Closing
----------------------
Date, the Company shall determine to register any of its securities (for itself
or for any other securities holder of the Company) under the Securities Act or
any successor legislation (other than a registration relating to stock option
plans, employee benefit plans or a Rule 145 transaction), and in connection
therewith the Company may lawfully register its Common Stock, the Company will
promptly give written notice thereof to the then holders (the "Holders") of all
issued or issuable Registrable Securities (as hereinafter defined) and will use
its best efforts to include in such registration and to effect the registration
under the Securities Act of all Registrable Securities which such Holders may
request in writing delivered to the Company within 15 days after receipt by such
Holder of the notice given by the Company; provided, however, if the managing
underwriter for the Company advises the Company in writing that including all or
part of the Registrable Shares in such offering will adversely affect the
marketing of the proposed offering, then, in connection with any such
underwritten offering by the Company of any of its securities, such registration
of Registrable Securities shall be limited to not less than 10% of the total
number of shares to be sold in the case of an initial public offering of the
Company's securities, and 20% of the total number of shares to be sold in the
case of a subsequent offering; further provided, however, that such limited
number of shares of Common Stock in such offering, which shares shall be taken
from those owned (or obtainable upon the exercise of rights with respect to
other securities) by a group of holders requesting registration consisting of
the Holders and other holders having similar registration rights to those of the
Holders, and such limitation shall be imposed upon the Holders and such other
holders pro rata on the basis of the total number of (i) shares of Registrable
Securities owned by the requesting Holders and (ii) shares of Common Stock
owned, or obtainable by them upon the exercise of rights with respect to other
securities, by such other requesting holders. In the event of such a
limitation, shares of persons not having similar registration rights will not be
included in such registration. The Company shall have the right to select the
managing underwriter or underwriters for any underwritten offering made pursuant
to a registration under this Section 8.3 hereof.
8.4 Registrable Securities. For the purposes of these provisions, the term
----------------------
"Registrable Securities" shall mean (i) the Common Stock issued or issuable upon
conversion of the Preferred (the "Conversion Stock"), (ii) the Common Stock
issued or issuable upon the exercise of the Warrants and (iii) any Common Stock
issued or issuable with respect to the Common Stock described in clause (i) or
(ii) by way of a stock dividend or stock.
8.5 Expenses of Registration.
------------------------
(a) All expenses of the registration and offering incurred in connection
with (i) one registration pursuant to Section 8.1, and (ii) three registrations
pursuant to Section 8.3, shall be borne by the Company, except that the Holders
shall bear underwriting commissions and discounts attributable to their
Registrable Securities being registered and the fees and expenses of separate
-12-
counsel, if any, for such Holders. Unless otherwise stated, all Selling
Expenses relating to securities registered on behalf of the Holders and all
other Registration Expenses shall be borne by the Holders of such securities pro
rata. If the Company includes in such registration any securities to be offered
by it, all expenses shall be borne by the Company.
(b) A proportionate share of the expenses of the registration and offering
incurred in connection with (i) a registration pursuant to Section 8.2 and (ii)
any registration pursuant to Section 8.3 after the third registration
thereunder, shall be borne pro rata by the Holder or Holders requesting the
registration on the basis of the ratio of the number of their shares so
registered to the total number of shares included in such registration.
8.6 Transfer of Registration Rights. The rights to cause the Company to
-------------------------------
register securities granted Purchasers under Sections 8.1, 8.2 and 8.3 may be
assigned to a transferee or assignee reasonably acceptable to the Company in
connection with any transfer or assignment of Registrable Securities by a
Purchaser provided that: (i) such transfer may otherwise be effected in
accordance with applicable securities laws, and (ii) such assignee or transferee
acquires at least 5,000 shares of the Registrable Securities (appropriately
adjusted for Recapitalizations). Notwithstanding the foregoing, the rights to
cause the Company to register securities may be assigned to any constituent
partner of the Partnership, without compliance with item (ii) above, provided
notice thereof is promptly given to the Company.
8.7 Standoff Agreement. The Holders shall, if requested by the managing
------------------
underwriter or underwriters of any proposed firm underwritten offering of
securities by the Company, agree not to sell any of their Registrable Securities
or any other securities of the Company owned by such Holders in any transaction
other than pursuant to such underwritten offering for a period of up to 90 days
beginning on the effective date of the registration statement, provided that the
Company's officers and directors and each holder of 10% or more of the Company's
issued and outstanding Common Stock also agree to such limitations. The Holders
shall upon request execute a written agreement confirming and agreeing as to the
foregoing.
8.8 Registration Indemnification. In the event of any Registration under
----------------------------
the Act pursuant to these provisions of Registrable Securities of any Holder,
the Company will hold harmless such Holder and each underwriter of such
securities and each other person, if any, who controls such Holder or such
underwriter within the meaning of the Act, against any losses, claims, damages
or liabilities to which such Holder or such underwriter or controlling person
may become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in any registration statement, or any preliminary prospectus or final
prospectus or amendment or supplement thereto on the effective date thereof, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading; and will reimburse such Holder and each such
underwriter and each such controlling person for any legal or any other
expenses
-13-
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, or any preliminary prospectus or final prospectus or
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Company through an instrument duly executed by such
Holder or such underwriter specifically for use in the preparation thereof.
It shall be a condition precedent to the obligation of the Company to
include in any registration statement any Registrable Securities then held by a
Holder that the Company shall have received an undertaking satisfactory to it
and its counsel from each Holder, to indemnify and hold harmless (in the same
manner and to the same extent as set forth in the preceding paragraph) the
Company, each director of the Company, each officer of the Company who shall
sign such registration statement and any person who controls the Company within
the meaning of the Act, with respect to any statement or omission from such
registration statement, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereto, if such statement or omission
was made in reliance upon and in conformity with information furnished to the
Company through an instrument duly executed by the Holder specifically for use
in the preparation of such registration statement, preliminary prospectus or
final prospectus or such amendment or supplement thereto.
Promptly after receipt by an indemnified party of notice of the
commencement of any action involving a claim referred to in the preceding
paragraphs of these provisions, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party, give written notice
to the latter of the commencement of such action. In case any such action is
brought against an indemnified party, the indemnifying party will be entitled to
participate in and to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such indemnified party for
any legal or other expenses incurred by the latter in connection with the
defense thereof.
9. Right of First Purchase.
-----------------------
9.1. Right of First Purchase. The Company hereby grants to each Purchaser
-----------------------
the right to first purchase for a number of shares of the same class of New
Securities (as defined in this Section 9.1) which the Company may, from time to
time, propose to sell and issue. Each Purchaser shall be entitled to purchase a
number of shares of the class of New Securities sufficient to maintain his pro
rata ownership in the Company after taking into account the proposed issuance by
the Company, which pro rata ownership is equal to the ratio that the sum of the
number of shares of Preferred, the number of outstanding shares of Conversion
Stock and the number of shares of Common Stock held by such Purchaser as a
result of the exercise of Warrants then held by such Purchaser bears to the
-14-
sum of the total number of shares of Common Stock then outstanding and the
number of shares of Conversion Stock or Common Stock issuable upon conversion of
the then outstanding Preferred.
(a) Except as set forth below, "New Securities" shall mean any shares of
capital stock of the Company including Common Stock and Preferred Stock, whether
now authorized or not, and rights, options or warrants to purchase said shares
of Common Stock or Preferred Stock, and securities of any type whatsoever that
are, or may become, convertible into said shares of Common Stock or Preferred
Stock. Notwithstanding the foregoing, "New Securities" does not include (i) the
shares of Preferred issued pursuant to this Agreement, the Conversion Stock or
Common Stock issued upon the exercise of the Warrants, (ii) securities offered
to the public generally pursuant to a registration statement or pursuant to
Regulation A under the Securities Act, (iii) securities issued in the
acquisition of another corporation by the Company by merger, purchase of
substantially all of the assets or other reorganization whereby the Company or
its shareholders own not less than fifty-one percent (51%) of the voting power
of the surviving or successor corporation, (iv) shares of the Company's Common
Stock or related options exercisable for such Common Stock issued to employees,
officers and directors of, and consultants, customers, and vendors to, the
Company, pursuant to any arrangement approved by the Board of Directors of the
Company, (v) stock issued pursuant to any rights or agreements, including
without limitation convertible securities, options and warrants, provided that
the rights of first purchase established by this Section 9.1 apply with respect
to the initial sale or grant by the Company of such rights or agreements, or
(vi) stock issued in connection with any stock split, stock dividend or
recapitalization by the Company.
(b) In the event the Company proposes to undertake an issuance of New
Securities, it shall give each Purchaser written notice of its intention,
describing the type of New Securities, and the price and terms upon which the
Company proposes to issue the same. The Company shall include with such notice a
brief summary of the business plan of the Company. Each Purchaser shall have ten
(10) days from the date of receipt of any such notice to agree to purchase up to
the Purchaser's share (calculated in accordance with Section 9.1(a)) of such New
Securities for the price and upon the terms specified in the notice by giving
written notice to the Company and stating therein the quantity of New Securities
to be purchased. The Company shall notify each Purchaser of any material
revision to the price and terms of the issuance of New Securities and Purchasers
shall be entitled to 10 additional days in order to respond to the Company.
(c) In the event a Purchaser fails to exercise such right of first
purchase within said 10 day period, the Company shall have 120 days thereafter
to sell or enter into an agreement ("pursuant to which the sale of New
Securities covered thereby shall be closed, if at all, within 60 days from the
date of said agreement) to sell the New Securities not elected to be purchased
by Purchasers at the price and upon the terms no more favorable to the
purchasers of such securities than specified in the Company's notice. In the
event the Company has not sold the New Securities or entered into an agreement
to Sell the New Securities within said 120 day period tor sold and issued New
Securities in accordance with the foregoing within 60 days for the date of said
agreement), the
-15-
Company shall not thereafter issue or sell any of such New Securities, without
offering securities in the manner provided above.
(d) The right of first purchase granted under this Agreement shall expire
upon the first to occur of the following: (i) the closing of the first public
offering of the Common Stock of the Company to the general public which is
effected pursuant to a registration statement filed with, and declared effective
by, the Commission under the Securities Act; or (ii) as to a Purchaser if such
Purchaser no longer holds at least 5,000 shares of Preferred and/or Conversion
Stock and Warrants (appropriately adjusted for Recapitalizations).
(e) The right of first purchase hereunder is not assignable except by each
of such Purchasers to any wholly-owned subsidiary or constituent partner who
acquires at least 5,000 shares (appropriately adjusted for Recapitalizations).
10. Restrictions on Transfer; Other Agreements.
------------------------------------------
10.1. Restrictive Legend. (a) The Purchaser Units shall (unless their
------------------
disposition is otherwise permitted by the provisions of this Section 10) be
subject to stop transfer instructions and shall be stamped or otherwise
imprinted with a legend in substantially the following form:
"This security has not been registered under the Securities Act of
1933, as amended, and may not be offered, sold or otherwise transferred,
pledged or hypothecated unless and until registered under such act, or
unless such offer, sale, transfer, pledge or hypothecation is exempt from
registration or is otherwise in compliance with such act. The
transferability of this security is also subject to restrictions contained
in a Purchase Agreement which agreements the Company will furnish to the
holder of this security upon request."
(b) The Company hereby agrees that it will, upon the Purchasers request,
eliminate the foregoing legend and stop transfer instructions if, in the written
opinion of counsel (which counsel and opinion (in form, scope and substance)
shall be satisfactory to the Company), the Purchaser is entitled, without
limitation as to manner or sales to sell the Purchaser Units without
registration under the Securities Act by reason of Rule 144 thereunder (or any
successor provision).
10.2. Restrictions on Transfer. The Purchasers by acquiring any of the
------------------------
Purchaser Units hereunder, hereby covenants and agrees that, except as herein
provided, it will not directly or indirectly offer for sale or sell (within the
meaning of the Securities Act) any of the Purchaser Units.
(a) The Purchaser may offer or sell the Purchaser Units pursuant to:
(i) an effective registration statement under the Securities Act
("Registration Statement") filed by the Company under Section 8 hereof, or
-16-
(ii) an exemption from registration under the Securities Act,
provided that prior to any such proposed transfer of the Purchaser Units,
the Purchaser shall give written notice to the Company of the Purchaser's
intention to effect such transfer, which notice shall be accompanied by
such evidence as may be reasonably satisfactory to the Company that the
proposed transfer of the Purchaser Units may be effected without
registration under the Securities Acts whereupon the Purchaser shall be
entitled to transfer the Purchaser Units in accordance with the terms of
the notice delivered by the Purchaser to the Company, or
(iii) the provisions of Rule 144 under the Securities Act, if
applicable.
(b) Any offer or sale of the Purchaser Units shall be made in accordance
with the Federal and state securities laws (including the prospectus delivery
requirements of the Securities Act), if applicable.
(c) Notwithstanding any provision in this Section 10 to the contrary, the
Partnership shall be permitted to transfer Preferred and Warrants to any
withdrawing partner thereof or as a result of the liquidation of the
Partnership, all in accordance with the Partnership Agreement. Such securities
transferred by the Partnership pursuant to this paragraph shall remain subject
to the other provisions of this Section 10.
(d) Each of the Purchaser Units transferred as above provided shall bear
the appropriate restrictive legend set forth in Section 10.1 above except as
provided in Section 8 or if, in the opinion of the legal counsel referred to
above (which counsel and opinion (in form, scope and substance) shall be
satisfactory to the Company), such legend is not required in order to establish
compliance with any provisions of the Securities Act.
11. Miscellaneous.
-------------
11.1. Notices: Payments. Except as otherwise provided in this Agreement,
-----------------
all notices, requests, claims, demands, waivers and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given
when delivered by hand, if delivered personally or by courier, or five business
days after being deposited in the mail (registered or certified mails postage
prepaid, return receipt requested) properly addressed as set forth below. Any
such notice or other communication shall be addressed (a) if to the Purchasers
at the address included in their respective Subscription Agreement or at such
other address as the Purchaser shall have furnished to the Company in writing,
(b) if to the Partnership, at such address provided in the Partnership
Agreement, (c) if to any subsequent holder of any of the Purchaser Units, at
such address as shown on the Security Register of the Company maintained
pursuant to the Certificate of Designation or Warrant Agreement or (d) if to the
Company, to Hybrid Fax, Inc., 000 Xxxxx Xxxxxx, Xx. 000, Xxx Xxxxx, Xxxxxxxxxx
00000, Attention: President, with a copy to: Xxxxxxx X. Xxxx, Xxxxxxx & Xxxxx,
0000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxx 00000, or to such other address and/or
to the
-17-
attention of such other copied person as the Company shall have furnished
to the Purchaser, the Partnership and each such other holder in writing.
11.2. Headings; Schedules and Exhibits. The headings herein are for
--------------------------------
convenience of reference only, do not constitute a part of this Agreement and
shall not be deemed to limit or affect any of the provisions hereof. The
schedules and exhibits attached hereto, and the certificates and other documents
delivered as specified herein, are expressly made a part of this Agreement.
11.3. Effect of Agreement.
-------------------
(a) This Agreement, including the representations and warranties contained
herein and the annexes, schedules, exhibits, certificates, opinions and other
documents referred to herein or delivered pursuant hereto, and the Subscription
Agreements contain the entire agreement between the Purchaser and the Company
with respect to the subject matter contained herein and supersede all prior
agreements and understandings, oral and written, with respect thereto. No
representations and warranties other than those contained herein or in any such
annex, schedule, exhibit, certificate, opinion or other document shall be deemed
to have been made by the Purchaser or the Company with respect to this
Agreement, the Subscription Agreements and the Purchaser Units. All of the
representations and warranties contained herein and in the Subscription
Agreements or in any such annex, schedule, exhibit, certificate or opinion or
other document shall survive the Closing, regardless of any investigation that
may have been or may be made (or any statements made in respect thereof) at any
time by or on behalf of the party to whom such representations and warranties
are made.
(b) This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns but, except
as otherwise provided herein, neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by either of the parties
hereto without the prior written consent of the other party. Nothing in this
Agreement, expressed or implied, is intended to confer on any person other than
the parties hereto or their respective successors and assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
(c) No right, power or remedy granted under this Agreement is intended to
be exclusive, but each shall be cumulative and in addition to any other rights,
powers or remedies referred to in this Agreement or otherwise available at law
or in equity; and the exercise or beginning of exercise by any party hereto of
any one or more of such rights, powers or remedies shall not preclude the
simultaneous or later exercise by such party of any or all such other rights,
powers or remedies. No waiver by any party hereto, and no failure or delay on
the part of such party in any one or more instances to insist upon strict
performance or observance of one or more covenants or conditions hereof, shall
in any way be, or be construed to be, a waiver thereof or prevent such party's
rights to require at a later time the performance or observance of such
covenants or conditions, or otherwise prejudice such party's rights, powers or
remedies.
-18-
11.4. Company Information. For so long as the Purchasers shall own
-------------------
Preferred or Warrants, the Company shall furnish to each Purchaser owning
Preferred or Warrants (i) for the first three quarters of each fiscal year
reports of its business and operations (including unaudited quarterly financial
statements) and (ii) for each fiscal year, an annual report of its business and
operations (including financial statements which financial statements shall be
audited commencing for the year ended December 31, 1989 and all subsequent
years). The Company shall, from time to time prior to the Closing, provide to
the Purchaser such other information respecting the business operations,
financial condition or assets of the Company as the Purchaser may reasonably
request.
11.5. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT
REGARD TO THE CONFLICT OF LAWS RULES THEREOF.
11.6. Counterparts. This Agreement may be executed simultaneously in two or
------------
more counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
11.7. Expenses and Fees. The Company shall pay all costs and expenses
-----------------
in connection with the negotiation, preparation, printing, typing, reproduction,
execution and delivery of this Agreement, the Certificate of Designation, the
Warrant Agreement and the Registration Rights Agreement, any amendment or
supplement to or modification of any of the foregoing and any and all other
documents furnished pursuant hereto or thereto or in connection herewith or
therewith including the reasonable fees and disbursements of Xxxxxxx & Xxxxx,
except for the fees of counsel who render the opinions specified in Sections 8
and 9 hereof (which fees shall be paid by the Purchaser incurring such fees),
all costs and expenses in connection with the administration of this Agreement
and all reasonable costs and expenses (including, without limitations attorneys
fees and expenses), if any, in connection with the enforcement of this
Agreement, the Certificate of Designation, the Warrant Agreement or any other
agreement furnished pursuant hereto or thereto or in connection herewith or
therewith; provided that the Company shall not be obligated to pay any amounts
in accordance with the performance of the registration rights granted in Section
8 hereof except as provided therein.
11.8. Delivery. The Purchasers hereby appoints the Partnership as its agent
--------
to accept delivery of the Purchaser Units at the Closing and to execute a
receipt for such Units on the Purchaser's and the Partnership's behalf.
11.9. Lost, Etc., Certificates Evidencing Preferred Certificates;
-----------------------------------------------------------
Exchange of Certificates. Upon receipt of evidence satisfactory to the Company
------------------------
of the loss, theft, destruction or mutilation of any certificate evidencing any
shares of Preferred held by the Purchaser or the Partnership, and in case of
loss, theft or destruction, upon receipt of indemnity reasonably satisfactory to
the Company, or, in the case of such mutilation, upon surrender and cancellation
of such certificate, the Company will make and deliver in lieu of such
certificate one or more new certificates of the same series and
-19-
in such denomination or denominations as the Purchaser or the Partnership, as
the case may be, may request for the same aggregate number of shares of
Preferred evidenced by the certificate so lost, stolen, destroyed or mutilated,
less the number of shares of Preferred, if any, originally evidenced by such
certificate that have theretofore been redeemed, and registered in such name or
names as the Purchaser or the Partnership may request. Replacement of lost,
stolen or mutilated Warrant Certificates shall be governed by the Warrant
Agreement.
Upon surrender by the Purchaser, or the Partnership or their respective
nominee of any certificate evidencing any shares of Preferred for exchange at
the office of the Company, the Company at its expense (exclusive of applicable
transfer taxes if any) will issue in exchange therefor one or more new
certificates of the same series and in such denomination or denominations as
such Purchaser may request for the same aggregate number of shares of Preferred
originally evidenced by the certificate so surrendered, less the number of
shares of Preferred, if any, evidenced by such surrendered certificate that have
theretofore been redeemed, and registered in such name or names as such
Purchaser or the Partnership may request.
11.10. Amendments; Waiver. This Agreement may be amended only with, and
------------------
any provision of this Agreement may be waived only by, the written consent of
the holders of at least 66-2/3% of the aggregate Stated Value of the Preferred;
provided however, that no such amendment or waiver of this Section 11.10 shall
be effective without the written consent of the holders of 100% of the
outstanding Preferred.
-20-
EXECUTED as of the date first above written by the Company, the Partnership
and each of the Purchasers listed in Schedule I hereto by their attorney-in-fact
pursuant to the power of attorney granted in each of the Subscription
Agreements.
HYBRID FAX, INC.
By:/s/Xxxxxx X. Xxxxxx III
--------------------------
Title: President
---------------
FIRST STAGE PARTNERS
By: /s/Xxxxxxx X. Xxxx
----------------------------
Administrative Partner
THE PURCHASERS LISTED IN
SCHEDULE I HERETO
By:/s/ Xxxxxxx X. Xxxx
------------------------------
Xxxxxxx X. Xxxx, Attorney-in-fact
-21-
SCHEDULE I
Amount No. of Shares
of of No. of
Partner Subscription Series A Pfd. Warrants
-------- ------------ ------------- --------
Xxxxxxx X. Xxxx
Xxxxxxx & Xxxxx
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000 $40,000 53,333 13,334
Cornerstone Management
0000 Xxxx Xxxx Xxxx
Xxxx. 0, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attn: J. Xxxxxxx Xxxxxxx $10,000 13,333 3,334
Xxxxx X. Xxxxxx
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X 00000 $10,000 13,333 3,334
Xxxxxxx X. Xxxxxx
Xxxxxx Associates
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000 $10,000 13,333 3,334
Xxxxxx X. Xxxxxxx/(1)/
000 Xxx Xxxxx Xxx.
Xxxxxx, Xxx Xxxxxx 00000 $10,000 13,333 3,334
Xxxxxx X. Xxxxxx
Xxxxxxx & Xxxxx
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000 $15,000 20,000 5,000
Xxxx X. Xxxxxx
0000X Xxxxxxxxx
Xxxxxxx, Xxxxx 00000 $10,000 13,333 3,334
Xxxx X. Lego
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000 $20,000 26,666 6,667
--------------------------
/(1)/Interest assigned by Xxxxxxx X. Xxxxxxx, III to wife.
-22-
Amount No. of Shares
of of No. of
Investor Subscription Series A Pfd. Warrants
-------- ------------ ------------- --------
Xxxx X. Xxxxx/(2)/ $ 5,000 6,667 1,667
c/o Xxxxxxx X. Xxxxx
0000 Xxxx Xxx Xxxx
Xxxxxxx, Xxxxx 00000
Xxxxxxxx X. Xxxxx/(2)/ $ 5,000 6,666 1,667
c/o Xxxxxxx X. Xxxxx
0000 Xxxx Xxx Xxxx
Xxxxxxx, Xxxxx 00000
Xxxxx X. Xxxxxx $ 10,000 13,333 3,334
Xxxxxxx & Xxxxx
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Xx. X. Xxxxxx Parks $ 10,000 13,333 3,334
Xxxxxxx & Xxxxxxx
Biotechnology Center
X.X. Xxx 0000
Xx Xxxxx, Xxxxxxxxxx 00000
Xxxxx X. Xxxxxxxx III $ 10,000 13,333 3,334
Xxxxxxx & Xxxxx
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Xxxxxx X. Xxxxxx, Xx. $ 40,000 53,333 13,334
00000 Xxxxx Xxx-Xx
Xxxxxxx, Xxxxx 00000
Xxxxxxx X. Xxxxxx $ 10,000 13,333 3,334
X.X. Xxx 000
Xxxxxxxxx, Xxxxx 00000
Van Saun Associates, Inc. $ 10 000 13,333 3,334
X.X. Xxx 000 -------- ------- ------
Middletown, Conn. 06457
Total $225,000 299,995 75,009
---------------------------------
/(2) /Interest assigned by Xxxxxxx X. Xxxxx to daughters.
-23-
