EXHIBIT 10.24
VOTING AGREEMENT
This VOTING AGREEMENT (the "Agreement") is entered into as of the 31/st/
day of December, 1998 (the "Effective Date"), by and among VOICE TECHNOLOGIES
PARTNERS, LTD., a Texas limited partnership ("Partners"), L & H INVESTMENT
COMPANY N.V., a Belgium corporation ("L&H"), and APPLIED VOICE RECOGNITION,
INC., a Delaware corporation (the "Company"), with respect to all of the issued
and outstanding common stock and preferred stock of the Company (the "Shares"),
presently or hereinafter owned by Partners and L&H (Partners, L&H and the
Company are sometimes hereinafter referred to individually as a "Party" and
collectively as the "Parties").
W I T N E S S E T H:
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WHEREAS, L&H and the Company are parties to that certain Applied Voice
Recognition, Inc. Series D Preferred Stock and Warrant Purchase Agreement dated
of even date herewith (the "Purchase Agreement"), pursuant to which L&H has
acquired two thousand (2,000) shares of Series D Preferred Stock, $0.10 par
value, of the Company ("Series D Preferred Stock"), and may acquire up to three
thousand (3,000) additional shares of Series D Preferred Stock;
WHEREAS, Partners currently owns five million nine hundred twenty thousand
(5,920,000) shares of common stock, $0.001 par value, of the Company ("Common
Stock"); and
WHEREAS, it is the desire of the Parties to ensure that Partners shall have
the right to designate three (3) of the directors of the Company and that L&H
shall have the right to designate two (2) of the directors of the Company;
NOW THEREFORE, in consideration of the promises, mutual representations,
agreements and covenants herein contained, the Parties hereby mutually covenant
and agree as follows:
ARTICLE I
VOTING OF SHARES
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1.1 VOTING FOR DIRECTOR DESIGNEES. Until the termination of this
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Agreement or as set forth in Section 1.3 below, in any election of the directors
of the Company, all of the Shares of the Company subject to this Agreement shall
be voted (a) for each of three (3) directors designated by Partners (the
"Partners' Directors"), and (b) for each of two (2) directors designated by L&H
(the "L&H Directors"). One of the L&H Directors shall be Xxx Lernout for so long
as he is willing and able to carry of the duties of a director of the Company.
Each person nominated by L&H as an L&H Director and each person nominated by
Partners as a Partners' Director must be qualified and shall be subject to the
approval of a majority of the members of the Board of Directors of the Company,
which approval shall not unreasonably be withheld.
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1.2 ADDITIONAL VOTING AGREEMENTS. Each of the Parties agrees to use its
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best efforts to cause designees to be elected to the Board of Directors as
provided in Section 1.1. In the event of any vacancy in the Board of Directors,
each of Partners and L&H agrees to vote all Shares owned or controlled by such
stockholder and to otherwise use such stockholder's best efforts to fill such
vacancy so that the Board of Directors of the Company will include directors
designated as provided in Section 1.1. Each of Partners and L&H agrees to vote
all Shares owned or controlled by such stockholder for the removal of a director
whenever (but only whenever) there shall be presented to the Board of Directors
the written consent that such director be removed, signed (i) by Partners, in
the case of any Partners' Director, or (ii) by L&H, in the case of any L&H
Director.
1.3 TERMINATION WITH RESPECT TO ELECTION OF PARTNERS' DIRECTORS. Any and
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all obligations of the parties hereto to cause designees of Partners to be
elected to the Board of Directors shall terminate upon termination of that
certain Co-Sale and Tag-Along Rights Agreement among the Parties dated December
31, 1998.
ARTICLE II
RESTRICTION ON CERTIFICATES
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2.1 LEGEND. The Parties agree that all certificates representing all
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Shares of the Company which at any time are subject to the provisions of this
Agreement shall have conspicuously placed upon their faces the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE PROVISIONS OF
A VOTING AGREEMENT DATED AS OF DECEMBER 31, 1998, BY AND AMONG CERTAIN
STOCKHOLDERS OF THE CORPORATION AND THE CORPORATION, A COPY OF WHICH IS ON
FILE WITH THE SECRETARY OF THE CORPORATION AT ITS PRINCIPAL PLACE OF
BUSINESS AND SHALL BE SUBJECT TO THE SAME RIGHT OF EXAMINATION BY A
STOCKHOLDER OF THE CORPORATION, IN PERSON OR BY AGENT OR ATTORNEY, AS ARE
THE BOOKS AND RECORDS OF THE CORPORATION.
2.2 EFFECT OF SALE OR TRANSFER. Unless the Parties agree otherwise, any
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sale or other transfer of any of the Shares subject hereto shall cause the
provisions of this Agreement to be inapplicable to any such transferee and the
Shares so transferred, unless such transfer is to an affiliate of the
transferring party.
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ARTICLE III
COPY OF AGREEMENT ON FILE
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A copy of this Agreement shall be placed on file at the Company's principal
place of business and shall be subject to the same right of examination by a
stockholder of the Company, in person or by agent or attorney, as are the books
and records of the Company.
ARTICLE IV
TERMINATION OF AGREEMENT
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This Agreement shall terminate and be of no further force and effect upon
the happening of any of the following:
(a) The written agreement of all of the Parties;
(b) The dissolution of the Company;
(c) Such time as all Parties shall cease to own any Shares of the
Company; or
(d) The conversion to Common Stock of at least 90% of the originally
issued Series D Preferred Stock.
Upon any such termination, the Parties shall submit the certificates
representing all Shares of the Company which are at such time subject to the
provisions of this Agreement and which have had placed on their face the legend
set forth in Article II in order that the Company reissue the Shares deleting
said legend.
ARTICLE V
MISCELLANEOUS PROVISIONS
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5.1 AGREEMENT TO PERFORM NECESSARY ACTS. Each of the Parties agrees to
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perform any further acts and execute and deliver any documents that may be
reasonably necessary to carry out the provisions of this Agreement.
5.2 AMENDMENTS. The provisions of this Agreement may be waived, altered,
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amended, or repealed, in whole or in part, only on the written consent of each
of the Parties.
5.3 SEVERABILITY. In the event that any of the provisions or portions
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thereof, of this Agreement are held to be unenforceable or invalid by any court
of competent jurisdiction, the validity and enforceability of the remaining
provisions, or portions thereof, shall not be affected thereby.
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5.4 SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall inure
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to the benefit of and shall be binding on the assigns, successors in interest,
personal representatives, estates, heirs and legatees of each of the Parties.
5.5 ENTIRE AGREEMENT. This Agreement contains the entire understanding
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between the Parties concerning the subject matter contained herein. There are
no representations, agreements, arrangements, or understandings, oral or
written, between or among the Parties, relating to the subject matter of this
Agreement, which are not fully expressed herein.
5.6 SPECIFIC ENFORCEMENT. This Agreement shall be specifically
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enforceable by the Parties.
5.7 CONSIDERATION. This Agreement is made by the Parties in consideration
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of the mutual promises contained herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged.
5.8 GENDER AND NUMBER. Whenever required by the context of this
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Agreement, the singular includes the plural, the masculine includes the feminine
or the neuter and the feminine includes the masculine or the neuter.
5.9 GOVERNING LAW. This Agreement shall be governed by and construed in
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accordance with the laws of the State of Delaware.
5.10 NOTICE. Any notice required or permitted under this Agreement
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shall be given in writing and shall be delivered in person or by telecopy or by
overnight courier guaranteeing no later than second business day delivery, or
five days after deposit with the United States Post Office, by registered or
certified mail, postage prepaid, in any case directed to the appropriate party
at the address set forth below its signature hereto. Any party may change its
address for notice by giving ten (10) days advance written notice to the other
parties. Every notice or other communication hereunder shall be deemed to have
been duly given or served on the date on which personally delivered, or on the
date actually received, if sent by telecopy or overnight courier service, with
receipt acknowledged.
5.11 ARBITRATION. All disputes, claims, and/or requests for specific
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contractual performance, or other equitable relief, or damages or any other
matters in question between the parties arising out of this Agreement shall be
submitted for arbitration, provided that the parties have first made a good
faith effort to resolve such matters together. Demand shall be made to the
American Arbitration Association ("AAA") and shall be conducted in New York, New
York by a panel of three (3) arbitrators. L&H and the Company shall each choose
one (1) panel member (unless L&H is not a party to the dispute, in which case
Partners and the Company shall each choose one (1) panel member) from a panel of
person having experience with and knowledge of the purchase and sale of
securities. The third member shall be an independent party, chosen by the first
two members. At least one member of the panel must have a legal background.
Arbitration shall be in accordance with the commercial rules of the AAA. The
Award of the Arbitrators shall be final and judgement may be entered upon it in
any court having jurisdiction
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thereof, and the prevailing party shall be entitled to costs and reasonable
attorneys' fees arising out of Arbitration.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
Effective Date.
PARTNERS:
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Address for Notice: VOICE TECHNOLOGIES PARTNERS,
LTD., a Texas limited partnership
0000 Xxxx Xxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000 By: Voice Technologies Management Corp.,
Telephone: (000) 000-0000 a Texas corporation, its general partner
Telecopier: (000) 000-0000
/s/ Xxxxxxx X. Xxxxxxxx
By:______________________________________
Xxxxxxx X. Xxxxxxxx, President
L&H:
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Address for Notice: L & H INVESTMENT COMPANY X.X.
Xxxx-Xxxxxxxxxxxxxx 0
0000 Xxxxx
Xxxxxxx /s/ Xxxxxx Xxxxx
Telephone: 000-00-0-000-0000 By:______________________________________
Telecopier: 011-32-5-722-9545 C.V.B.A. Xxxxxx Xxxxx, Director
THE COMPANY:
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Address for Notice: APPLIED VOICE RECOGNITION, INC.,
a Delaware corporation
0000 Xxxx Xxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000 /s/ Xxxxxxx X. Xxxxxxxx
Telephone: (000) 000-0000 By:______________________________________
Telecopier: 011-32-5-722-9545 Xxxxxxx X. Xxxxxxxx, Chief
Executive Officer
[SIGNATURE PAGE TO VOTING AGREEMENT]
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