STOCK PURCHASE AGREEMENT
Between
DIRECTVIEW, INC.
and
XXXXXXX PARK INVESTMENTS PLC
July 12, 2004
TABLE OF CONTENTS
ARTICLE I CERTAIN DEFINITIONS........................................1
1.1 Certain Definitions..........................................1
ARTICLE II PURCHASE AND SALE OF SHARES................................4
2.1 Purchase and Sale; Purchase Price............................4
2.2 Execution and Delivery of Documents; The Closing.............5
ARTICLE III REPRESENTATIONS AND WARRANTIES............................5
3.1 Representations, Warranties and Agreements of the Target
Company......................................................5
3.2 Representations and Warranties of Xxxxxxx....................8
ARTICLE IV OTHER AGREEMENTS OF THE PARTIES...........................11
4.1 Manner of Offering..........................................11
4.2 Notice of Certain Events....................................12
4.3 Blue Sky Laws...............................................12
4.4 Integration.................................................12
4.5 Furnishing of Rule 144(c) Materials.........................12
4.6 Solicitation Materials......................................12
4.7 Listing of Common Stock.....................................13
4.8 Indemnification.............................................13
4.9 Sale of Xxxxxxx Shares......................................15
4.10 Lock Up by Xxxxxxx..........................................15
4.11 London Stock Exchange.......................................15
ARTICLE V MISCELLANEOUS.............................................15
5.1 Fees and Expenses...........................................15
5.2 Entire Agreement............................................15
5.3 Notices.....................................................15
5.4 Amendments; Waivers.........................................16
5.5 Headings....................................................16
5.6 Successors and Assigns......................................16
5.7 No Third Party Beneficiaries................................17
5.8 Governing Law; Venue; Service of Process....................17
5.9 Survival....................................................17
5.10 Counterpart Signatures......................................17
5.11 Publicity...................................................17
5.12 Severability................................................17
5.13 Limitation of Remedies......................................17
LIST OF SCHEDULES:
Schedule 3.1(a)...Subsidiaries
Schedule 3.1(c)...Capitalization and Registration Rights
Schedule 3.1(d)...Equity and Equity Equivalent Securities
Schedule 3.1(e)...Conflicts
Schedule 3.1(f)...Consents and Approvals
Schedule 3.1(g) ..Litigation
Schedule 3.1(h)...Defaults and Violations
LIST OF EXHIBITS:
Exhibit A.........Escrow Agreement
Exhibit B Officer's Certificate
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of July 12, 2004, between DirectView, Inc., a corporation organized and
existing under the laws of the State of Nevada (the "Target Company"), and
Xxxxxxx Park Investments PLC, a corporation organized under the laws of England
and Wales with its offices at 00 Xxxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX (
"Xxxxxxx").
WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Target Company desires to issue and sell to Xxxxxxx and Xxxxxxx
desires to acquire from the Target Company the shares of the Target Company's
common stock, par value $.001 (the "Common Stock") for the Total Purchase Price
set forth in Section 2.1(b) below. The consideration to be paid by Xxxxxxx for
the Common Stock shall be subject to certain downside price protection (the
"Downside Price Protection") provided in Section 2 of the Escrow Agreement.
IN CONSIDERATION of the mutual covenants contained in this Agreement,
the Target Company and Xxxxxxx agree as follows:
ARTICLE I.........
CERTAIN DEFINITIONS
1.1 Certain Definitions. As used in this Agreement, and
unless the context requires a different meaning, the following terms have the
meanings indicated:
"Affiliate" means, with respect to any Person, any Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person. For the purposes of this definition, "control" (including,
with correlative meanings, the terms "controlled by" and "under common control
with") shall mean the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such Person, whether
through the ownership of voting securities or by contract or otherwise.
"Agreement" shall have the meaning set forth in the introductory
paragraph of this Agreement.
"Business Day" means any day except Saturday, Sunday, any day which
shall be a legal holiday or a day on which banking institutions in the State of
New York are authorized or required by law or other government actions to close.
"Closing" shall have the meaning set forth in Section 2.2(a) hereof.
"Closing Bid Price" shall mean the closing bid price for a share of
Common Stock on such date on the OTCBB (or such other exchange, market, or other
system that the Common Stock is then traded on), as reported on Bloomberg, L.P.
(or similar organization or agency succeeding to its functions of reporting
prices).
"Closing Date" shall have the meaning set forth in Section 2.2(a)
hereof.
"Closing Price" shall be the Closing Bid Price of the Common Stock on
the day of Closing.
"Common Stock" shall have the meaning in the recital.
"Consideration Stock" shall have the meaning set forth in Section
2.1(a) hereof.
"Control Person" shall have the meaning set forth in Section 4.8(a)
hereof.
"Disclosure Documents" means the Target Company's reports filed under
the Exchange Act with the SEC.
"Downside Price Protection" shall have the meaning in the recital.
"Escrow Agent" means Gottbetter & Partners, LLP, 000 Xxxxxxx Xxxxxx, 00
Xxxxx, Xxx Xxxx, XX 00000; Tel: 000-000-0000; Fax: 000-000-0000.
"Escrow Agreement" means the escrow agreement, dated the date hereof,
by and among the Target Company, Xxxxxxx and the Escrow Agent annexed hereto as
Exhibit A.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"G&P" means Gottbetter & Partners, LLP.
"Indemnified Party" shall have the meaning set forth in Section 4.8(b)
hereof.
"Indemnifying Party" shall have the meaning set forth in Section
4.8(b) hereof.
.........
"Xxxxxxx" shall have the meaning in the introductory paragraph.
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"Xxxxxxx Consideration Shares" shall have the meaning in Section 2.1(c)
hereof.
"Xxxxxxx Escrow Shares" means the Xxxxxxx Consideration Shares
deposited into escrow by the Target Company under the terms of the Escrow
Agreement in Exhibit A.
"Xxxxxxx Protection Shares" means the Xxxxxxx Escrow Shares that the
Target Company is required to sell to Xxxxxxx under the terms of the Escrow
Agreement in Exhibit A.
"Xxxxxxx Shares" shall mean ordinary shares of 1.0p each in Xxxxxxx.
"Losses" shall have the meaning set forth in Section 4.8(a) hereof.
"Material" shall mean having a financial consequence in excess of
$25,000.
"Material Adverse Effect" shall have the meaning set forth in Section
3.1(a) hereof.
"NASD" means the National Association of Securities Dealers, Inc.
----
"Nasdaq" shall mean the Nasdaq Stock Market, Inc.(R)
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"OTCBB" shall mean the NASD over-the counter Bulletin Board(R).
"Person" means an individual or a corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind.
"Private Placement Memorandum" shall have the meaning set forth in
Section 3.1(l) hereof.
"Proceeding" means an action, claim, suit, investigation or proceeding
(including, without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Subsidiaries" shall have the meaning set forth in Section 3.1(a)
hereof.
"Target Company" shall have the meaning set forth in the introductory
paragraph.
"Total Purchase Price" shall have the meaning set forth in Section
2.1(b).
"Trading Day" means (a) a day on which the Common Stock is quoted on
Nasdaq, the OTCBB or the principal stock exchange on which the Common Stock has
been listed, or (b) if the Common Stock is not quoted on Nasdaq, the OTCBB or
any stock exchange, a day on which the Common Stock is quoted in the
over-the-counter market, as reported by the Pinksheets LLC (or any similar
organization or agency succeeding its functions of reporting prices).
"Transaction Documents" means this Agreement and all exhibits and
schedules hereto and all other documents, instruments and writings required
pursuant to this Agreement.
"U.S." means the United States.
ARTICLE II........
PURCHASE AND SALE OF SHARES
2.1 Purchase and Sale; Purchase Price.
---------------------------------
(a) Subject to the terms and conditions set forth herein, the Target
Company shall issue and sell and Xxxxxxx shall purchase Forty Seven
Million Five Hundred Thousand (47,500,000) shares of the Target
Company's Common Stock (the "Consideration Stock").
(b) The total purchase price (the "Total Purchase Price") shall be the
number of shares of Consideration Stock multiplied by the average of
the Closing Bid Price per share of Common Stock during the ten (10)
Trading Days immediately preceding July 30, 2004.
(c) The Total Purchase Price shall be paid by delivery to the Target
Company of the number of Xxxxxxx Shares (the "Xxxxxxx Consideration
Shares") equal to the Total Purchase Price divided by the conversion
rate of the British Pound Sterling to purchase US Dollars as
determined below on the July 30, 2004. The Xxxxxxx Shares shall have
a value of (pound)1 per share. The number of Xxxxxxx Shares to be
issued will be based on the conversion rate of the British Pound
Sterling to the US Dollar in effect as of the close of business on the
day preceding the Closing Date, as quoted by Xxxxxx & Co. as the
commercial rate it gives to purchase US Dollars. For example, if
the effective conversion rate is $1.80/(pound) 1 and the Total
Purchase Price is $8,000,000, then the number of Xxxxxxx Shares the
Target Company will receive shall equal the $8,000,000/$1.80, or
4,444,444 Xxxxxxx Shares. The Xxxxxxx Consideration Shares shall
be subject to the "Downside Price Protection" provided in Section
2 of the Escrow Agreement.
2.2 Execution and Delivery of Documents; The Closing.
------------------------------------------------
(a) The Closing of the purchase and sale of the shares of Consideration
Stock (the "Closing") shall take place by August 20, 2004 (the "Closing
Date"). On the Closing Date,
(i) the Target Company shall execute and deliver to the Escrow Agent
certificates in the name of Xxxxxxx representing the shares of
Consideration Stock;
(ii) the Target Company shall execute and deliver to Xxxxxxx a certificate
of its President, in the form of Exhibit B annexed hereto, certifying
that attached thereto is a copy of resolutions duly adopted by the
Board of Directors of the Target Company authorizing the Target Company
to execute and deliver the Transaction Documents and to enter into the
transactions contemplated thereby;
(iii) the Target Company, Xxxxxxx and the Escrow Agent shall execute and
deliver to each other the Escrow Agreement;
(iv) Xxxxxxx shall execute and deliver to the Escrow Agent certificates in
the name of the Target Company representing the Xxxxxxx Consideration
Shares to the Escrow Agent; and
(v) the Target Company shall wire the monies owed to G&P pursuant to
Section 5.1 hereof for legal fees with the following wire instructions:
Citibank, N.A.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX
ABA Routing No.: 000000000
Account Name: Gottbetter & Partners, LLP
Account No. 00000000
Reference: DirectView, Inc.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 Representations, Warranties and Agreements of the Target Company. The
Target Company hereby makes the following representations and warranties to
Xxxxxxx, all of which shall survive the Closing:
(a) Organization and Qualification. The Target Company is a corporation, duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its formation, with the requisite corporate power and
authority to own and use its properties and assets and to carry on its
business as currently conducted. The Target Company has no subsidiaries
other than as set forth on Schedule 3.1(a) attached hereto (collectively,
the "Subsidiaries"). Each of the Subsidiaries is a corporation, duly
incorporated, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with the full corporate power and
authority to own and use its properties and assets and to carry on its
business as currently conducted. Each of the Target Company and the
Subsidiaries is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which the nature of the
business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing,
as the case may be, would not, individually or in the aggregate, have a
material adverse effect on the results of operations, assets, prospects, or
financial condition of the Target Company and the Subsidiaries, taken as a
whole (a "Material Adverse Effect").
(b) Authorization, Enforcement. The Target Company has the requisite corporate
power and authority to enter into and to consummate the transactions
contemplated hereby and by each other Transaction Document and to otherwise
to carry out its obligations hereunder and thereunder. The execution and
delivery of this Agreement and each of the other Transaction Documents by
the Target Company and the consummation by it of the transactions
contemplated hereby and thereby has been duly authorized by all necessary
action on the part of the Target Company. Each of this Agreement and each
of the other Transaction Documents has been or will be duly executed by the
Target Company and when delivered in accordance with the terms hereof or
thereof will constitute the valid and binding obligation of the Target
Company enforceable against the Target Company in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
laws relating to, or affecting generally the enforcement of, creditors'
rights and remedies or by other equitable principles of general
application.
(c) Capitalization. The authorized, issued and outstanding capital stock of the
Company is set forth on Schedule 3.1(c). No shares of Common Stock are
entitled to preemptive or similar rights, nor is any holder of the Common
Stock entitled to preemptive or similar rights arising out of any agreement
or understanding with the Target Company by virtue of this Agreement.
Except as disclosed in Schedule 3.1(c), there are no outstanding options,
warrants, script, rights to subscribe to, registration rights, calls or
commitments of any character whatsoever relating to securities, rights or
obligations convertible into or exchangeable for, or giving any person any
right to subscribe for or acquire, any shares of Common Stock, or
contracts, commitments, understandings, or arrangements by which the Target
Company or any Subsidiary is or may become bound to issue additional shares
of Common Stock, or securities or rights convertible or exchangeable into
shares of Common Stock. Neither the Target Company nor any Subsidiary is in
violation of any of the provisions of its Certificate of Incorporation,
bylaws or other charter documents.
(d) Issuance of Securities. The shares of Consideration Stock have been
duly and validly authorized for issuance, offer and sale pursuant to
this Agreement and, when issued and delivered as provided hereunder
against payment in accordance with the terms hereof, shall be valid and
binding obligations of the Target Company enforceable in accordance
with their respective terms.
(e) No Conflicts. The execution, delivery and performance of this Agreement and
the other Transaction Documents by the Target Company and the consummation
by the Target Company of the transactions contemplated hereby and thereby
do not and will not (i) conflict with or violate any provision of its
Certificate of Incorporation or bylaws (each as amended through the date
hereof) or (ii) be subject to obtaining any consents except those referred
to in Section 3.1(f), conflict with, or constitute a default (or an event
which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Target
Company is a party, or (iii) result in a violation of any law, rule,
regulation, order, judgment, injunction, decree or other restriction of any
court or governmental authority to which the Target Company or its
Subsidiaries is subject (including, but not limited to, those of other
countries and the federal and state securities laws and regulations), or by
which any property or asset of the Target Company or its Subsidiaries is
bound or affected, except in the case of clause (ii), such conflicts,
defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect. The business of the Target Company and its Subsidiaries is
not being conducted in violation of any law, ordinance or regulation of any
governmental authority.
(f) Consents and Approvals. Except as specifically set forth in Schedule
3.1(f), neither the Target Company nor any Subsidiary is required to
obtain any consent, waiver, authorization or order of, or make any
filing or registration with, any court or other federal, state, local
or other governmental authority or other Person in connection with the
execution, delivery and performance by the Target Company of this
Agreement and each of the other Transaction Documents.
(g) Litigation; Proceedings. Except as specifically disclosed in Schedule
3.1(g), there is no Proceeding threatened against or affecting the Target
Company or any of its Subsidiaries or any of their respective properties
before or by any court, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign) which (i) relates to
or challenges the legality, validity or enforceability of any of the
Transaction Documents or the shares of Consideration Stock, (ii) could,
individually or in the aggregate, have a Material Adverse Effect or (iii)
could, individually or in the aggregate, materially impair the ability of
the Target Company to perform fully on a timely basis its obligations under
the Transaction Documents.
(h) No Default or Violation. Except as set forth in Schedule 3.1(h) hereto,
neither the Target Company nor any Subsidiary (i) is in default under or in
violation of any indenture, loan or credit agreement or any other agreement
or instrument to which it is a party or by which it or any of its
properties is bound, except such conflicts or defaults as do not have a
Material Adverse Effect, (ii) is in violation of any order of any court,
arbitrator or governmental body, except for such violations as do not have
a Material Adverse Effect, or (iii) is in violation of any statute, rule or
regulation of any governmental authority which could (individually or in
the aggregate) (a) adversely affect the legality, validity or
enforceability of this Agreement, (b) have a Material Adverse Effect or (c)
adversely impair the Target Company's ability or obligation to perform
fully on a timely basis its obligations under this Agreement.
(i) Disclosure Documents. The Disclosure Documents are accurate in all
material respects and do not contain any untrue statement of material
fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they
were made, not misleading.
(j) Non-Registered Offering. Neither the Target Company nor any Person
acting on its behalf has taken or will take any action (including,
without limitation, any offering of any securities of the Target
Company under circumstances which would require the integration of such
offering with the offering of the Consideration Stock under the
Securities Act) which might subject the offering, issuance or sale of
the Consideration Stock to the registration requirements of Section 5
of the Securities Act.
(k) Placing Agent. The Target Company accepts and agrees that Dungarvon
Associates, Inc. ("Dungarvon") is acting for Xxxxxxx and does not
regard any person other than Xxxxxxx as its customer in relation to
this Agreement, and that it has not made any recommendation to the
Target Company, in relation to this Agreement and is not advising the
Target Company, with regard to the suitability or merits of the Xxxxxxx
Shares and in particular Dungarvon has no duties or responsibilities to
the Target Company for the best execution of the transaction
contemplated by this Agreement.
(l) Private Placement Representations. The Target Company (i) has received and
carefully reviewed such information and documentation relating to Xxxxxxx
that the Target Company has requested, including, without limitation,
Xxxxxxx'x Confidential Private Offering Memorandum, dated June 17, 2004
(the "Private Placement Memorandum"); (ii) has had a reasonable opportunity
to ask questions of and receive answers from Xxxxxxx concerning the Xxxxxxx
Shares, and all such questions, if any, have been answered to the full
satisfaction of the Target Company; (iii) has such knowledge and expertise
in financial and business matters that it is capable of evaluating the
merits and risks involved in an investment in the Xxxxxxx Shares; (iii)
understands that Xxxxxxx has determined that the exemption from the
registration provisions of the Securities Act, provided by Section 4(2) of
the Securities Act is applicable to the offer and sale of the Xxxxxxx
Shares, based, in part, upon the representations, warranties and agreements
made by the Target Company herein; and (iv) except as provided herein and
in the Private Placement Memorandum, no representations or warranties have
been made to the Target Company by Xxxxxxx or any agent, employee or
affiliate of Xxxxxxx and in entering into this transaction the Target
Company is not relying upon any information, other than the results of
independent investigation by the Target Company.
Xxxxxxx acknowledges and agrees that the Target Company makes no representation
or warranty with respect to the transactions contemplated hereby other than
those specifically set forth in Section 3.1 hereof.
3.2 Representations and Warranties of Xxxxxxx. Xxxxxxx hereby makes the
following representations and warranties to the Target Company, all of which
shall survive the Closing:
(a) Organization; Authority. Xxxxxxx is a corporation, duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
formation with the requisite power and authority to enter into and to
consummate the transactions contemplated hereby and by the other
Transaction Documents and otherwise to carry out its obligations hereunder
and thereunder. The acquisition of the shares of Consideration Stock to be
purchased by Xxxxxxx hereunder has been duly authorized by all necessary
action on the part of Xxxxxxx. This Agreement has been duly executed and
delivered by Xxxxxxx and constitutes the valid and legally binding
obligation of Xxxxxxx, enforceable against it in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to, or
affecting generally the enforcement of, creditors rights and remedies or by
other general principles of equity.
(b) Investment Intent. Xxxxxxx is acquiring the shares of Consideration
Stock to be purchased by it hereunder, for its own account for
investment purposes only and not with a view to or for distributing or
reselling such shares of Consideration Stock, or any part thereof or
interest therein, without prejudice, however, to Xxxxxxx'x right,
subject to the provisions of this Agreement, at all times to sell or
otherwise dispose of all or any part of such shares of Consideration
Stock in compliance with applicable federal and state securities laws.
(c) Experience of Xxxxxxx. Xxxxxxx, either alone or together with its
representatives, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the
merits and risks of an investment in the shares of Consideration Stock
to be acquired by it hereunder, and has so evaluated the merits and
risks of such investment.
(d) Ability of Xxxxxxx to Bear Risk of Investment. Xxxxxxx is able to bear
the economic risk of an investment in the Consideration Stock to be
acquired by it hereunder and, at the present time, is able to afford a
complete loss of such investment.
(e) Access to Information. Xxxxxxx acknowledges that it has been afforded (i)
the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Target Company concerning the
terms and conditions of the Consideration Stock offered hereunder and the
merits and risks of investing in such securities; (ii) access to
information about the Target Company and the Target Company's financial
condition, results of operations, business, properties, management and
prospects sufficient to enable it to evaluate its investment in the
Consideration Stock; and (iii) the opportunity to obtain such additional
information which the Target Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed
investment decision with respect to the investment and to verify the
accuracy and completeness of the information that it has received about the
Target Company.
(f) Reliance. Xxxxxxx understands and acknowledges that (i) the shares of
Consideration Stock being offered and sold to it hereunder are being
offered and sold without registration under the Securities Act in a
private placement that is exempt from the registration provisions of
the Securities Act under Section 4(2) of the Securities Act and (ii)
the availability of such exemption depends in part on, and that the
Target Company will rely upon the accuracy and truthfulness of, the
foregoing representations and Xxxxxxx hereby consents to such reliance.
(g) Regulation X. Xxxxxxx understands and acknowledges that (A) the shares of
Consideration Stock have not been registered under the Securities Act, are
being sold in reliance upon an exemption from registration afforded by
Regulation S; and that such shares of Consideration Stock have not been
registered with any state securities commission or authority; (B) pursuant
to the requirements of Regulation S, the shares of Consideration Stock may
not be transferred, sold or otherwise exchanged unless in compliance with
the provisions of Regulation S and/or pursuant to registration under the
Securities Act, or pursuant to an available exemption hereunder; and (C)
the Target Company is under no obligation to register the shares of
Consideration Stock under the Securities Act or any state securities law,
or to take any action to make any exemption from any such registration
provisions available.
Xxxxxxx is not a U.S. Person and is not acquiring the shares of
Consideration Stock for the account of any U.S. Person; (B) no director or
executive officer of Xxxxxxx is a national or citizen of the United States; and
(C) it is not otherwise deemed to be a "U.S. Person" within the meaning of
Regulation X.
Xxxxxxx was not formed specifically for the purpose of acquiring the
shares of Consideration Stock purchased pursuant to this Agreement.
Xxxxxxx is purchasing the shares of Consideration Stock for its own
account and risk and not for the account or benefit of a U.S. Person as defined
in Regulation S and no other person has any interest in or participation in the
shares of Consideration Stock or any right, option, security interest, pledge or
other interest in or to the shares of Consideration Stock. Xxxxxxx understands,
acknowledges and agrees that it must bear the economic risk of its investment in
the shares of Consideration Stock for an indefinite period of time and that
prior to any such offer or sale, the Target Company may require, as a condition
to effecting a transfer of the shares of Consideration Stock, an opinion of
counsel, acceptable to the Target Company, as to the registration or exemption
therefrom under the Securities Act and any state securities acts, if applicable.
Xxxxxxx will, after the expiration of the Restricted Period, as set
forth under Regulation S Rule 903(b)(3)(iii)(A), offer, sell, pledge or
otherwise transfer the shares of Consideration Stock only in accordance with
Regulation S, or pursuant to an available exemption under the Securities Act
and, in any case, in accordance with applicable state securities laws. The
transactions contemplated by this Agreement have neither been pre-arranged with
a purchaser who is in the U.S. or who is a U.S. Person, nor are they part of a
plan or scheme to evade the registration provisions of the United States federal
securities laws.
The offer leading to the sale evidenced hereby was made in an "offshore
transaction." For purposes of Regulation S, Xxxxxxx understands that an
"offshore transaction" as defined under Regulation S is any offer or sale not
made to a person in the United States and either (A) at the time the buy order
is originated, the purchaser is outside the United States, or the seller or any
person acting on his behalf reasonably believes that the purchaser is outside
the United States; or (B) for purposes of (1) Rule 903 of Regulation S, the
transaction is executed in, or on or through a physical trading floor of an
established foreign exchange that is located outside the United States or (2)
Rule 904 of Regulation S, the transaction is executed in, on or through the
facilities of a designated offshore securities market, and neither the seller
nor any person acting on its behalf knows that the transaction has been
prearranged with a buyer in the U.S.
Neither Xxxxxxx nor any affiliate or any Person acting on Xxxxxxx'x
behalf, has made or is aware of any "directed selling efforts" in the United
States, which is defined in Regulation S to be any activity undertaken for the
purpose of, or that could reasonably be expected to have the effect of,
conditioning the market in the United States for any of the shares of
Consideration Stock being purchased hereby.
Xxxxxxx understands that the Target Company is the seller of the shares
of Consideration Stock which are the subject of this Agreement, and that, for
purpose of Regulation S, a "distributor" is any underwriter, dealer or other
person who participates, pursuant to a contractual arrangement, in the
distribution of securities offered or sold in reliance on Regulation S and that
an "affiliate" is any partner, officer, director or any person directly or
indirectly controlling, controlled by or under common control with any person in
question. Xxxxxxx agrees that Xxxxxxx will not, during the Restricted Period set
forth under Rule 903(b)(iii)(A), act as a distributor, either directly or though
any affiliate, nor shall it sell, transfer, hypothecate or otherwise convey the
shares of Consideration Stock other than to a non-U.S. Person.
Xxxxxxx acknowledges that the shares of Consideration Stock will bear a
legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD IN AN
"OFFSHORE TRANSACTION" IN RELIANCE UPON REGULATION S AS PROMULGATED BY THE
SECURITIES AND EXCHANGE COMMISSION. ACCORDINGLY, THE SECURITIES REPRESENTED BY
THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT") AND MAY NOT BE TRANSFERRED OTHER THAN IN ACCORDANCE WITH
REGULATION S, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, THE
AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE CANNOT BE THE SUBJECT OF HEDGING
TRANSACTIONS UNLESS SUCH TRANSACTIONS ARE CONDUCTED IN COMPLIANCE WITH THE
SECURITIES ACT.
THE SALE OF THE SHARES REPRESENTED BY THIS CERTIFICATE IS RESTRICTED PURSUANT TO
THE TERMS OF A STOCK PURCHASE AGREEMENT, DATED JULY __, 2004, BETWEEN THE
COMPANY AND XXXXXXX PARK INVESTMENTS PLC, A COPY OF WHICH IS AVAILABLE UPON
REQUEST.
The Target Company acknowledges and agrees that Xxxxxxx makes no representations
or warranties with respect to the transactions contemplated hereby other than
those specifically set forth in this Section 3.2.
ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
4.1 Manner of Offering. The Consideration Stock are being issued pursuant to
section 4(2) of the Securities Act and Regulation S thereunder. The Xxxxxxx
Consideration Shares are being issued pursuant to section 4(2) of the Securities
Act.
4.2 Notice of Certain Events. The Target Company shall, on a continuing basis,
(i) advise Xxxxxxx promptly after obtaining knowledge of, and, if requested by
Xxxxxxx, confirm such advice in writing, of (A) the issuance by any state
securities commission of any stop order suspending the qualification or
exemption from qualification of the shares of Consideration Stock, for offering
or sale in any jurisdiction, or the initiation of any proceeding for such
purpose by any state securities commission or other regulatory authority, or (B)
any event that makes any statement of a material fact made by the Target Company
in Section 3.1 or in the Disclosure Documents untrue or that requires the making
of any additions to or changes in Section 3.1 or in the Disclosure Documents in
order to make the statements therein, in the light of the circumstances under
which they are made, not misleading, (ii) use its best efforts to prevent the
issuance of any stop order or order suspending the qualification or exemption
from qualification of the Consideration Stock under any state securities or Blue
Sky laws, and (iii) if at any time any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Consideration Stock under any such laws, and
use its best efforts to obtain the withdrawal or lifting of such order at the
earliest possible time.
4.3 Blue Sky Laws. The Target Company agrees that it will execute all necessary
documents and pay all necessary state filing or notice fees to enable the Target
Company to sell the Consideration Stock to Xxxxxxx.
4.4 Integration. The Target Company shall not and shall use its best efforts to
ensure that no Affiliate shall sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in Section 2 of the
Securities Act) that would be integrated with the offer or sale of the
Consideration Stock in a manner that would require the registration under the
Securities Act of the sale of the Consideration Stock to Xxxxxxx.
4.5 Furnishing of Rule 144(c) Materials. The Target Company shall, for so long
as any of the Consideration Stock remain outstanding and during any period in
which the Target Company is not subject to Section 13 or 15(d) of the Exchange
Act, make available to any registered holder of the Consideration Stock in
connection with any sale thereof and any prospective purchaser of such
Consideration Stock from such Person, such information in accordance with Rule
144(c) promulgated under the Securities Act as is required to sell the
Consideration Stock under Rule 144 promulgated under the Securities Act.
4.6 Solicitation Materials. The Target Company shall not (i) distribute any
offering materials in connection with the offering and sale of the shares of
Consideration Stock other than the Disclosure Documents and any amendments and
supplements thereto prepared in compliance herewith or (ii) solicit any offer to
buy or sell the shares of Consideration Stock by means of any form of general
solicitation or advertising.
4.7 Listing of Common Stock. If the Common Stock is or shall become listed on
the OTCBB or on another exchange, the Target Company shall (a) use its best
efforts to maintain the listing of its Common Stock on the OTCBB or such other
exchange on which the Common Stock is then listed until two years from the date
hereof, and (b) shall provide to Xxxxxxx evidence of such listing.
4.8 Indemnification.
---------------
(a) Indemnification.
(i) The Target Company shall, notwithstanding termination of this Agreement and
for a period of six (6) years, indemnify and hold harmless Xxxxxxx and its
officers, directors, agents, employees and Affiliates, each Person who
controls or Xxxxxxx (within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act) (each such Person, a "Control Person")
and the officers, directors, agents, employees and Affiliates of each such
Control Person, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, costs (including,
without limitation, costs of preparation and attorneys' fees) and expenses
(collectively, "Losses"), as ------ incurred, arising out of, or relating
to, a breach or breaches of any representation, warranty, covenant or
agreement by the Target Company under this Agreement or any other
Transaction Document.
(ii) Xxxxxxx shall, notwithstanding termination of this Agreement and for a
period of six (6) years, indemnify and hold harmless the Target
Company, its officers, directors, agents and employees, each Control
Person and the officers, directors, agents and employees of each
Control Person, to the fullest extent permitted by applicable law, from
and against any and all Losses, as incurred, arising out of, or
relating to, a breach or breaches of any representation, warranty,
covenant or agreement by Xxxxxxx under this Agreement or the other
Transaction Documents, except for Losses solely arising out of
negligence, bad faith or breach of this Agreement by the Target
Company.
(iii) The Target Company and Xxxxxxx acknowledge that in the SEC's opinion,
directors, officers and persons controlling a company subject to the
Securities Act can not be indemnified for liabilities arising under the
Securities Act by such company.
(b) Conduct of Indemnification Proceedings. If any Proceeding shall be brought
or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party promptly shall notify the
Person from whom indemnity is sought (the "Indemnifying Party") in writing,
and the Indemnifying Party shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to the Indemnified Party and
the payment of all fees and expenses incurred in connection with defense
thereof; provided, that the failure of any Indemnified Party to give such
notice shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent
that it shall be finally determined by a court of competent jurisdiction
(which determination is not subject to appeal or further review) that such
failure shall have proximately and materially adversely prejudiced the
Indemnifying Party.
An Indemnified Party shall have the right to employ separate
counsel in any such Proceeding and to participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed to
pay such fees and expenses; or (2) the Indemnifying Party shall have failed
promptly to assume the defense of such Proceeding and to employ counsel
reasonably satisfactory to such Indemnified Party in any such Proceeding; or (3)
the named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party and the Indemnifying Party, and such
Indemnified Party shall have been advised by counsel that a conflict of interest
is likely to exist if the same counsel were to represent such Indemnified Party
and the Indemnifying Party (in which case, if such Indemnified Party notifies
the Indemnifying Party in writing that it elects to employ separate counsel at
the expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense of the claim against the Indemnified Party but will
retain the right to control the overall Proceedings out of which the claim arose
and such counsel employed by the Indemnified Party shall be at the expense of
the Indemnifying Party). The Indemnifying Party shall not be liable for any
settlement of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, effect any settlement of any
pending Proceeding in respect of which any Indemnified Party is a party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability on claims that are the subject matter of such Proceeding.
All fees and expenses of the Indemnified Party to which the
Indemnified Party is entitled hereunder (including reasonable fees and expenses
to the extent incurred in connection with investigating or preparing to defend
such Proceeding in a manner not inconsistent with this Section) shall be paid to
the Indemnified Party, as incurred, within ten (10) Business Days of written
notice thereof to the Indemnifying Party.
No right of indemnification under this Section shall be
available as to a particular Indemnified Party if the Indemnifying Party obtains
a non-appealable final judicial determination that such Losses arise solely out
of the negligence, breach of agreement or bad faith of such Indemnified Party in
performing the obligations of such Indemnified Party under this Agreement or a
breach by such Indemnified Party of its obligations under this Agreement.
(c) Contribution. If a claim for indemnification under this Section is
unavailable to an Indemnified Party or is insufficient to hold such
Indemnified Party harmless for any Losses in respect of which this Section
would apply by its terms (other than by reason of exceptions provided in
this Section), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses in such proportion as is
appropriate to reflect the relative benefits received by the Indemnifying
Party on the one hand and the Indemnified Party on the other and the
relative fault of the Indemnifying Party and Indemnified Party in
connection with the actions or omissions that resulted in such Losses as
well as any other relevant equitable considerations. The relative fault of
such Indemnifying Party and Indemnified Party shall be determined by
reference to, among other things, whether there was a judicial
determination that such Losses arise in part out of the negligence or bad
faith of the Indemnified Party in performing the obligations of such
Indemnified Party under this Agreement or the Indemnified Party's breach of
its obligations under this Agreement. The amount paid or payable by a party
as a result of any Losses shall be deemed to include any attorneys' or
other fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such
fees or expenses if the indemnification provided for in this Section was
available to such party.
(d) Non-Exclusivity. The indemnity and contribution agreements contained in
this Section are in addition to any obligation or liability that the
Indemnifying Parties may have to the Indemnified Parties.
4.9 Sale of Xxxxxxx Consideration Shares. Xxxxxxx shall assist the Target
Company in setting up and maintaining a trading account at a registered broker
in the United Kingdom to facilitate the sale of the Xxxxxxx Consideration
Shares. Broker's commissions in the trading account shall not exceed one half
percent (0.5%).
4.10 Lock Up by Xxxxxxx. Xxxxxxx shall not sell, transfer or assign all or any
of the shares of Consideration Stock for a period of two (2) years following the
Closing, without the written consent of the Target Company, which consent may be
withheld in the Target Company's sole discretion.
ARTICLE V
MISCELLANEOUS
5.1 Fees and Expenses. Except as set forth in this Agreement, each party shall
pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the
negotiation, preparation, execution, delivery and performance of this Agreement.
The Target Company shall pay all stamp and other taxes and duties levied in
connection with the issuance of the shares of Consideration Stock pursuant
hereto. Xxxxxxx shall be responsible for any taxes payable by Xxxxxxx that may
arise as a result of the investment hereunder or the transactions contemplated
by this Agreement or any other Transaction Document. The Target Company agrees
to pay $7,500 to G&P for legal fees associated with the transactions
contemplated by this Agreement at Closing. The Target Company shall pay all
costs, expenses, fees and all taxes incident to and in connection with: (A) the
issuance and delivery of the Consideration Stock, (B) the exemption from
registration of the Consideration Stock for offer and sale to Xxxxxxx under the
securities or Blue Sky laws of the applicable jurisdictions, and (C) the
preparation of certificates for the Consideration Stock (including, without
limitation, printing and engraving thereof), and (D) all fees and expenses of
counsel and accountants of the Target Company.
5.2 Entire Agreement This Agreement, together with all of the Exhibits and
Schedules annexed hereto, and any other Transaction Document contains the entire
understanding of the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, with respect
to such matters. This Agreement shall be deemed to have been drafted and
negotiated by both parties hereto and no presumptions as to interpretation,
construction or enforceability shall be made by or against either party in such
regard.
5.3 Notices. Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given upon
facsimile transmission (with written transmission confirmation report) at the
number designated below (if delivered on a Business Day during normal business
hours where such notice is to be received), or the first Business Day following
such delivery (if delivered other than on a Business Day during normal business
hours where such notice is to be received) whichever shall first occur. The
addresses for such communications shall be:
If to the Target Company: DirectView, Inc.
0000 Xxxx Xxxxxx Xxxx, Xxxxx 000
Xxxx Xxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, President
Tel: (000) 000-0000 Ext 105
Fax: (000) 000-0000
If to Xxxxxxx: Xxxxxxx Park Investments PLC
00 Xxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attn: Xxxxx Xxxxx
Tel: 00.000.000.0000
Fax: 00.000.000.0000
With copies to: Gottbetter & Partners, LLP
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxx X. Xxxxxxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
or such other address as may be designated hereafter by notice given pursuant to
the terms of this Section 5.3.
5.4 Amendments; Waivers. No provision of this Agreement may be waived or amended
except in a written instrument signed, in the case of an amendment, by both the
Target Company and Xxxxxxx, or, in the case of a waiver, by the party against
whom enforcement of any such waiver is sought. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
either party to exercise any right hereunder in any manner impair the exercise
of any such right accruing to it thereafter.
5.5 Headings. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.
5.6 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and permitted
assigns. The assignment by a party of this Agreement or any rights hereunder
shall not affect the obligations of such party under this Agreement.
5.7 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.
5.8 Governing Law; Venue; Service of Process. The parties hereto acknowledge
that the transactions contemplated by this Agreement and the exhibits hereto
bear a reasonable relation to the State of New York. The parties hereto agree
that the internal laws of the State of New York shall govern this Agreement and
the exhibits hereto, including, but not limited to, all issues related to usury.
Any action to enforce the terms of this Agreement or any of its exhibits, or any
other Transaction Document shall be brought exclusively in the state and/or
federal courts situated in the County and State of New York. If and only if New
York declines jurisdiction within the State of New York, such action shall be
brought in the State and County where the Target Company's principle place of
business is situated. Service of process in any action by Xxxxxxx or the Target
Company to enforce the terms of this Agreement may be made by serving a copy of
the summons and complaint, in addition to any other relevant documents, by
commercial overnight courier to the other party at its principal address set
forth in this Agreement.
5.9 Survival. The representations and warranties of the Target Company and
Xxxxxxx contained in Article III and the agreements and covenants of the parties
contained in Article IV and this Article V shall survive the Closing.
5.10 Counterpart Signatures. This Agreement may be executed in two or more
counterparts, all of which when taken together 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, it being understood that both
parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
5.11 Publicity. The Target Company and Xxxxxxx shall consult with each other in
issuing any press releases or otherwise making public statements with respect to
the transactions contemplated hereby and neither party shall issue any such
press release or otherwise make any such public statement without the prior
written consent of the other, which consent shall not be unreasonably withheld
or delayed, unless counsel for the disclosing party deems such public statement
to be required by applicable federal and/or state securities laws. Except as
otherwise required by applicable law or regulation, the Target Company will not
disclose to any third party (excluding its legal counsel, accountants and
representatives) the name of Xxxxxxx.
5.12 Severability. In case any one or more of the provisions of this Agreement
shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision which shall be a reasonable substitute
therefore, and upon so agreeing, shall incorporate such substitute provision in
this Agreement.
5.13 Limitation of Remedies. With respect to claims by the Target Company or any
person acting by or through the Target Company, or by Xxxxxxx or any person
acting through Xxxxxxx, for remedies at law or at equity relating to or arising
out of a breach of this Agreement, liability, if any, shall, in no event,
include loss of profits or incidental, indirect, exemplary, punitive, special or
consequential damages of any kind.
[ SIGNATURE PAGE FOLLOWS ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first indicated above.
Target Company:
DirectView, Inc.
By: _________________________
Name: _______________________
Title: _______________________
Xxxxxxx Park Investments PLC:
By: _______________________
Name: _____________________
Title: ____________________
Schedule 3.1(a)
Subsidiaries
Xxxxxxx Communications, Inc., a Florida corporation.
Meeting Technologies, Inc., a Delaware corporation.
Schedule 3.1(c)
Capitalization and Registration Rights
Common Stock
Total 216,860,090 outstanding
Options and Warrants
0
Schedule 3.1(e)
Conflicts
None
Schedule 3.1(f)
Consents and Approvals
None
Schedule 3.1(g)
Litigation
None pertaining to DirectView, Inc.
SEC 10Q dated 3/31/04 for Xxxxxxx Communications, Inc. -No material changes
since 10Q.
Schedule 3.1(h)
Defaults and Violations
None
EXHIBIT A
ESCROW AGREEMENT
ESCROW AGREEMENT (this "Agreement"), dated as of July 12, 2004, by and
between DirectView, Inc., a Nevada corporation with its principal place of
business at 0000 Xxxx Xxxxxx Xxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000 (the
"Target Company"); Gottbetter & Partners, LLP with its principal place of
business at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000 (the "Escrow Agent"); and
Xxxxxxx Park Investments Plc, a corporation organized under the laws of England
and Wales with its offices at 00 Xxxxxxxxxx Xxxxxx, Xxxxxx XX0X 0XX ("Xxxxxxx").
Recitals
A. Simultaneously with the execution of this Agreement,
Xxxxxxx and the Target Company entered into a Stock Purchase Agreement (the
"Stock Purchase Agreement"), dated as of the date hereof and incorporated herein
by reference, pursuant to which the Target Company has agreed to issue to
Xxxxxxx the Consideration Stock in exchange for the Xxxxxxx Consideration
Shares.
B. The parties have agreed that the Consideration Stock and
the Xxxxxxx Consideration Shares shall be deposited into escrow pursuant to this
Agreement, including fifty percent (50%) of the Xxxxxxx Consideration Shares to
be deposited into escrow as Downside Price Protection (the "Xxxxxxx Escrow
Shares").
C. The Escrow Agent is willing to act as escrow agent pursuant
to the terms of this Agreement with respect to the purchase of the shares of
Consideration Stock.
D. All capitalized terms used but not defined herein shall
have the meanings ascribed thereto in the Stock Purchase Agreement.
NOW, THEREFORE, IT IS AGREED:
1. Deposit into Escrow. At Closing, the parties shall deposit
into escrow (i) the Xxxxxxx Consideration Shares and (ii) the Consideration
Stock. The Escrow Agent shall hold the Xxxxxxx Consideration Shares and the
Consideration Stock in escrow when delivered.
2. Terms of Escrow. (a) If the Market Value of the Common
Stock on the date occurring two years after Closing (the "Two Year Anniversary")
is less than the Closing Price, the Target Company shall sell to Xxxxxxx and
Xxxxxxx shall purchase the number of Xxxxxxx Escrow Shares (the "Xxxxxxx
Protection Shares") equal to (a) the Xxxxxxx Consideration Shares multiplied by
(b) the Percentage Decrease, at a purchase price of 1p per Xxxxxxx Consideration
Share (the "Escrow Purchase Price"). The "Percentage Decrease" shall be equal to
1 - Market Value/the Closing Price. "Market Value" shall be the average of the
ten (10) closing bid prices per share of the Common Stock during the ten (10)
trading days immediately preceding the Two Year Anniversary.
Within three (3) Business Days of the Two Year Anniversary of the
Closing, Xxxxxxx shall (i) send a notice ("Sale Notice") to the Target Company
and the Escrow Agent of the Xxxxxxx Protection Shares to be sold by the Target
Company to Xxxxxxx, if any, and (ii) deposit the Escrow Purchase Price with the
Escrow Agent, if necessary. Within fourteen (14) Business Days of the Target
Company's and the Escrow Agent's receipt of the Sale Notice and Escrow Agent's
receipt of the Escrow Purchase Price, the Escrow Agent is authorized and
directed simultaneously (i) to pay the Escrow Purchase Price to the Target
Company, if any, (ii) to deliver the Xxxxxxx Protection Shares, if any, to
Xxxxxxx and (iii) to deliver the remaining Xxxxxxx Escrow Shares, if any, to the
Target Company.
(b) If at any time before September 30, 2004, the Escrow Agent
receives written notice (the "LSE Notice") from Xxxxxxx that the Xxxxxxx
Consideration Shares are listed on the London Stock Exchange plc (the "London
Exchange"), the Escrow Agent is authorized and directed to distribute, within
fourteen (14) Business Days of receipt of such LSE Notice, (i) the Consideration
Stock to Xxxxxxx and (ii) fifty percent (50%) of the Xxxxxxx Consideration
Shares to the Target Company. If the Escrow Agent does not receive such LSE
Notice by September 30, 2004, the Escrow Agent is authorized and directed to
distribute, no later than October 5, 2004, (i) the Consideration Stock to the
Target Company and (ii) the Xxxxxxx Consideration Shares to Xxxxxxx; provided,
however, that the Target Company shall have the option to extend the September
30, 2004 deadline by providing written notice to the Escrow Agent with a written
acknowledgement from Xxxxxxx.
3. Duties and Obligations of the Escrow Agent.
(a) The parties hereto agree that the duties and obligations
of the Escrow Agent shall be only those obligations herein specifically provided
and no other. The Escrow Agent's duties are those of a depositary only, and the
Escrow Agent shall incur no liability whatsoever, except as a direct result of
its willful misconduct or gross negligence in the performance of its duties
hereunder;
(b) The Escrow Agent may consult with counsel of its choice,
and shall not be liable for any action taken, suffered or omitted to be taken by
it in accordance with the advice of such counsel;
(c) The Escrow Agent shall not be bound in any way by the
terms of any other agreement to which Xxxxxxx and the Target Company are
parties, whether or not the Escrow Agent has knowledge thereof, and the Escrow
Agent shall not in any way be required to determine whether or not any other
agreement has been complied with by Xxxxxxx and the Target Company, or any other
party thereto. The Escrow Agent shall not be bound by any modification,
amendment, termination, cancellation, rescission or supersession of this
Agreement unless the same shall be in writing and signed jointly by Xxxxxxx and
the Target Company and agreed to in writing by the Escrow Agent;
(d) If the Escrow Agent shall be uncertain as to its duties or
rights hereunder or shall receive instructions, claims or demands which, in its
opinion, are in conflict with any of the provisions of this Agreement, the
Escrow Agent shall be entitled to refrain from taking any action other than
keeping safely the Consideration (as defined below) or taking certain action
until the Escrow Agent is directed otherwise in writing jointly by Xxxxxxx and
the Target Company or by a final judgment of a court of competent jurisdiction;
(e) The Escrow Agent shall be fully protected in relying upon
any written notice, demand, certificate or document which the Escrow Agent, in
good faith, believes to be genuine. The Escrow Agent shall not be responsible
for the sufficiency or accuracy of the form, execution, validity or genuineness
of documents or securities now or hereafter deposited hereunder or of any
endorsement thereon, or for any lack of endorsement thereon, or for any
description therein; nor shall the Escrow Agent be responsible or liable in any
respect on account of the identity, authority or rights of the persons executing
or delivering or purporting to execute or deliver any such document, security or
endorsement;
(f) The Escrow Agent shall not be required to institute legal
proceedings of any kind and shall not be required to defend any legal
proceedings which may be instituted against it or in respect of the
Consideration;
(g) If the Escrow Agent at any time, in its sole discretion,
deems it necessary or advisable to relinquish custody of any of the securities
(to the extent delivered to the Escrow Agent pursuant hereto, the
"Consideration"), it may do so by delivering the same to another Person that
agrees to act as escrow agent hereunder and whose substitution for the Escrow
Agent is agreed upon in writing by Xxxxxxx and the Target Company; provided,
however, that such successor Escrow Agent must be resident in the United States.
If no such escrow agent is selected within three (3) days after the Escrow Agent
gives notice to Xxxxxxx and the Target Company of the Escrow Agent's desire to
so relinquish custody of the Consideration and resign as Escrow Agent, then the
Escrow Agent may do so by delivering the Consideration to the clerk or other
proper officer of a state or federal court of competent jurisdiction situate in
the state and county of New York. The fee of any court officer shall be borne by
the Target Company. Upon such delivery, the Escrow Agent shall be discharged
from any and all responsibility or liability with respect to the Consideration
and this Agreement and each of the Target Company and Xxxxxxx shall promptly pay
all monies it may owe to the Escrow Agent for its services hereunder, including,
but not limited to, reimbursement of its out-of-pocket expenses pursuant to
paragraph (i) below;
(h) This Agreement shall not create any fiduciary duty on the
Escrow Agent's part to Xxxxxxx or the Target Company, nor disqualify the Escrow
Agent from representing either party hereto in any dispute with the other,
including any dispute with respect to the Stock Purchase Agreement; provided,
however, that in the event of such dispute, the Escrow Agent shall have the
right to commence an interpleader action in any court of competent jurisdiction
of the state of New York or of the United States located in the county and state
of New York, deposit the Consideration with such court;
(i) The parties acknowledge and agree that the Escrow Agent is
counsel to Xxxxxxx. The parties agree to, and agree not to object to, the Escrow
Agent's engagement as Escrow Agent hereunder;
(j) Upon the full performance of this Agreement, the Escrow
Agent shall be deemed released and discharged of any further obligations
hereunder.
4. Indemnification.
(a) Xxxxxxx hereby indemnifies and holds free and harmless the
Escrow Agent from any and all losses, expenses, liabilities and damages
(including but not limited to reasonable attorney's fees, and amounts paid in
settlement) resulting from claims asserted by the Target Company against the
Escrow Agent with respect to the performance of any of the provisions of this
Agreement;
(b) The Target Company hereby indemnifies and holds free and
harmless the Escrow Agent from any and all losses, expenses, liabilities and
damages (including but not limited to reasonable attorney's fees, and amount
paid in settlement) resulting from claims asserted by Xxxxxxx against the Escrow
Agent with respect to the performance of any of the provisions of this
Agreement;
(c) Xxxxxxx and the Target Company, jointly and severally,
hereby indemnify and hold the Escrow Agent harmless from and against any and all
losses, damages, taxes, liabilities and expenses that may be incurred by the
Escrow Agent, arising out of or in connection with its acceptance of appointment
as the Escrow Agent hereunder and/or the performance of its duties pursuant to
this Agreement, the Purchase Agreement and the securities, including, but not
limited to, all legal costs and expenses of the Escrow Agent incurred defending
itself against any claim or liability in connection with its performance
hereunder, provided that the Escrow Agent shall not be entitled to any indemnity
for any losses, damages, taxes, liabilities or expenses that directly result
from its willful misconduct or gross negligence in its performance as Escrow
Agent hereunder
(d) In the event of any legal action or Proceeding involving
any of the parties to this Agreement which is brought to enforce or otherwise
adjudicate any of the rights or obligations of the parties hereunder, the
non-prevailing party or parties shall pay the legal fees of the prevailing party
or parties and the legal fees, if any, of the Escrow Agent.
5. Miscellaneous.
(a) All notices, including Notices of Conversion and Notices of Exercise,
objections, requests, demands and other communications sent to any party
hereunder shall be deemed duly given if (x) in writing and sent by
facsimile transmission to the Person for whom intended if addressed to such
Person at its facsimile number set forth below or such other facsimile
number as such Person may designate by notice given pursuant to the terms
of this Section 5 and (y) the sender has confirmation of transmission:
(i) If to the Target Company: DirectView, Inc.
0000 Xxxx Xxxxxx Xxxx, Xxxxx 000
Xxxx Xxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, President
Tel: (000) 000-0000 Ext 150
Fax: (000) 000-0000
(ii) If to Xxxxxxx: Xxxxxxx Park Investments PLC
00 Xxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attn: Xxxxx Xxxxx
Tel: 00.000.000.0000
Fax: 00.000.000.0000
(iii) If to the Escrow
Agent: Gottbetter
& Partners, LLP
000 Xxxxxxx Xxx.
Xxx Xxxx, Xxx Xxxx
00000 Attn: Xxxx
X. Xxxxxxxxxx,
Esq. Tel: (212)
000-0000 Fax:
(000) 000-0000
(b) This Agreement has been prepared, negotiated and delivered in the state of
New York and shall be governed by and construed and enforced in accordance
with the laws of the state of New York applicable to contracts entered into
and performed entirely within New York, without giving effect to the
principles of New York law relating to the conflict of laws.
(c) This Agreement may be executed in two or more counterparts, all of which
when taken together 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, it being understood that both parties need
not sign the same counterpart. In the event that any signature is delivered
by facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile
signature page were an original thereof.
(d) This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The assignment by a
party of this Agreement or any rights hereunder shall not affect the
obligations of such party under this Agreement.
6. Termination of Escrow. The term of this Escrow Agreement shall begin
upon the date hereof and shall continue until terminated upon the earlier to
occur of (i) the Xxxxxxx Escrow Shares are fully distributed or (ii) the written
agreement of the parties to terminate this Agreement. Upon the termination of
this Escrow Agreement pursuant to subsection (ii), the Escrow Agent shall
distribute any of the Xxxxxxx Escrow Shares then held by it pursuant to the
terms of the written agreement of the parties.
[ SIGNATURE PAGE FOLLOWS ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed the day and year first above written.
The Target Company:
DirectView, Inc.
By: ______________
Name:
Title:
Xxxxxxx Park Investments PLC:
By: _______________
Name:
Title:
Escrow Agent:
Gottbetter & Partners, LLP
By:____________________
Name: Xxxx X Xxxxxxxxxx
Title: Managing Partner
EXHIBIT B
DirectView, Inc.
OFFICER'S CERTIFICATE
I, Xxxxxxx X. Xxxxxxx, being the President of DirectView, Inc., a
Nevada corporation (the "Target Company"), pursuant to Section 2.2(a)(ii) of
that certain Stock Purchase Agreement (the "Purchase Agreement"), dated as of
July 12, 2004, by and between the Target Company and Xxxxxxx Park Investments
PLC, do hereby certify on behalf of the Target Company that attached hereto is a
copy of the resolutions duly adopted by the Board of Directors of the Target
Company authorizing the Target Company to execute and deliver the Transaction
Documents, as such term is defined in the Purchase Agreement and to enter into
the transactions contemplated thereby.
IN WITNESS WHEREOF, I have executed this Officer's Certificate on
behalf of the Target Company this 12 day of July, 2004.
DirectView, Inc.
By:
------------------------------------
Xxxxxxx X. Xxxxxxx, President
