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EXHIBIT 4.1.2
INVESTMENT AGREEMENT
INVESTMENT AGREEMENT (this "Agreement") dated as of August 27, 1998
between Bristol Asset Management V LLC, a limited liability company organized
and existing under the laws of the State of Delaware (the "Investor"), and Jaws
Technology, Inc., a corporation organized and existing under the laws of the
State of Nevada (the "Company").
WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Investor shall invest up to $7,000,000 in the
Company's Common Stock, par value $.01 per share (the "Common Stock").
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE 1
Purchase and Sale of Common Stock; Issuance of Warrants
Section 1.1 Purchase and Sale of Common Stock. Upon the terms and
subject to the conditions set forth herein, the Company shall issue and sell to
the Investor, and the Investor shall purchase from the Company, up to $7,000,000
of Common Stock, such stock to be valued as provided in Section 1.3(b) herein.
Section 1.2 Delivery of Put Notices.
(a) At any time prior to the date which is three years from the
effective date of the Registration Statement (as defined below), the Company may
deliver written notices to the Investor (each such notice hereinafter referred
to as a "Put Notice") in the form of the Put Notice annexed to this Agreement as
Exhibit A stating a dollar amount (the "Dollar Amount") of Common Stock which
the Company intends to sell to the Investor five business days following the
date (the "Put Notice Date") on which the Put Notice is given to the Investor by
the Company in accordance with Section 5.4 herein, provided that each Put Notice
Date and Dollar Amount shall be subject to Section 1.3(a) below. "Business
day(s)" shall mean any day on which the New York Stock Exchange is open for
trading. The Dollar Amount designated by the Company in any given Put Notice
shall be an amount equal to at least $50,000.
(b) Notwithstanding any of the foregoing, the Company may not
deliver a Put Notice if (i) trading of the Common Stock on the principal market
on which it is then traded (the "Principal Market") is then suspended or the
Common Stock is then delisted from or is no longer eligible to be traded on the
Principal Market, (ii) the closing price of the Common Stock on the Principal
Market is less than $.10 per share (appropriately adjusted for any stock splits,
reverse splits or combinations, stock dividends and similar events), (iii) the
Dow Xxxxx Industrial Average has dropped more than 3% within the preceding five
business days, or (iv) the Common Stock is not then registered under the
Securities Exchange Act of 1934, as amended (the "Exchange
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Act"). If any of the events described in clauses (i), (ii), (iii) or (iv) above
occurs after a Put Notice is delivered but prior to the Closing (as defined
below) associated with such Put Notice, such Put Notice shall be null, void and
of no force and effect and a new Put Notice shall be required following the
termination of any such event.
Section 1.3 Determination of Share Number; Valuation Period
(a) Within ten days after the end of each calendar month, at the
option of the Company it may require a purchase of Common Stock by the Investor
(except as hereinafter in this Agreement provided), subject to the procedures
set forth in Section 1.2(a), in a maximum amount not to exceed the lesser of (i)
$7,000,000, less all amounts previously paid by the Investor pursuant to this
Section 1.3(a), (ii) $583,333, (iii) the product of (x) the number of shares of
Common Stock traded on the Principal Market during the preceding calendar month,
multiplied by (y) the average of the closing bid prices as reported by Bloomberg
L.P. ("Bloomberg") (or other appropriate published source) for the Common Stock
during the prior calendar month, multiplied by (z) 10% and (iv) such Dollar
Amount which, together with the related Warrants (as defined below) to be issued
pursuant to Section 1.4 below, would result in the Investor beneficially owning
no more than 4.9% of the Common Stock outstanding on the Closing Date (as
defined below) in question (including without limitation Common Stock deemed
beneficially owned by the Investor pursuant to any Warrants), as determined in
accordance with Section 13(d) of the Exchange Act and the regulations
promulgated thereunder. The Put Notice shall include a representation of the
Company as to the Common Stock outstanding on the Put Notice Date as determined
in accordance with Section 13(d) of the Exchange Act and the regulations
promulgated thereunder. In the event that the amount of Common Stock outstanding
as determined in accordance with Section 13(d) of the Exchange Act and the
regulations promulgated thereunder is different on a Closing Date than on the
Put Notice Date associated with such Closing Date, the amount of Common Stock
outstanding on such Closing Date shall govern for purposes of determining
whether the Investor would own more than 4.9% of the Common Stock as of such
Closing Date.
For example, if a total of 2,000,000 shares of Common Stock
traded during January of a particular year on the Principal Market and the
average of the closing bid prices was $1.00, on or before February 10 the
Company could request a draw down not to exceed 10% of $2,000,000 or $200,000,
so long as such amount was available under this Agreement and so long as such
amount did not result in the Investor beneficially owning more than 4.9% of the
Common Stock.
(b) Simultaneously with the deposit of the funds from the
Investor in the amount of the draw down (except as otherwise provided in Section
1.4 below) the Company shall issue and sell to the Investor and the Investor
shall be deemed to have purchased, in consideration of the funds so deposited,
the number of shares of Common Stock equal to the draw down divided by 77% of
the lowest sale price for the Common Stock on the Principal Market as reported
by Bloomberg (or other appropriate published source) (the "Lowest Sale Price")
during the ten trading days prior to the Put Notice Date (the "Look Back
Period"). For example, if the Lowest
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Sale Price for the Look Back Period was $1.00 and the draw down was $100,000,
the number of shares of Common Stock to be issued would be 129,870 shares.
Notwithstanding the foregoing, in the event that the Lowest Sale Price during
the 20 trading days after a particular Closing is less than 95% of the Lowest
Sale Price applicable to such Closing, then the Company shall promptly issue to
the Investor an additional number of shares of Common Stock with respect to such
Closing such that the number of shares of Common Stock issued to the Investor at
such Closing plus such additional number of shares to be issued are equal to the
funds drawn down at such Closing divided by 77% of the Lowest Sale Price during
such 20 trading day period. The Investor shall also be issued additional
Warrants equal to 12% of the number of additional shares so issued and the
exercise price of such additional Warrants shall equal, and the exercise price
of the Warrants issued at such prior Closing shall be adjusted to, 94% of the
average closing bid price for the Common Stock on the Principal Market as
reported by Bloomberg (or other appropriate published source) during such 20
trading day period.
(c) The Company shall not be required to issue fractional shares
of Common Stock and instead shall refund to the Investor an amount equal to the
fraction which would otherwise have been issued times 77% of the average closing
bid price during the Look Back Period determined as provided in Section 1.3(b)
above.
Section 1.4 Closing.
(a) Each Closing of a purchase and sale of Common Stock (a
"Closing") shall take place at 10:00 a.m. Los Angeles time on the fifth business
day following the Put Notice Date to which such Closing relates or the earliest
date thereafter on which all conditions to Closing have been satisfied. Each
date on which a Closing occurs is referred to herein as a "Closing Date."
(b) On each Closing Date the Investor shall deliver to the
Company the Dollar Amount with respect to such Closing by cashier's check or
wire transfer to such account as shall be designated in writing by the Company;
provided however, that to the extent the Company has not paid fees and expenses
of the Investor's representatives and counsel which are payable by the Company
under this Agreement, the amount of such fees and expenses may be withheld by
the Investor and applied to such unpaid fees and expenses with no reduction in
the number of shares to be issued and sold to the Investor. On each Closing
Date, the Company shall deliver to the Investor unlegended certificates
representing the number of shares to be issued and sold to the Investor on such
date and registered in the name of the Investor. In addition, each of the
Company and the Investor shall deliver all documents, instruments and writings
required to be delivered by either of them pursuant to this Agreement at or
prior to each Closing.
(c) On each Closing Date, except as provided in Section 1.4(d)
below, the Company shall also deliver to the Investor warrants in the form
annexed to this Agreement as Exhibit B ("Warrants") to purchase shares of Common
Stock (the "Warrant Shares"), which Warrants shall expire on the fifth
anniversary of the date of issuance thereof. The Warrants issuable at any
Closing shall entitle the holders thereof from time to time (the "Warrant
Holders")
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to purchase a number of Warrant Shares equal to 12% of the number of shares of
Common Stock purchased at the Closing in question at an initial exercise price
(subject to the provisions of Section 1.3(b) above) equal to 94% of the average
closing bid price for the Common Stock on the Principal Market as reported by
Bloomberg (or other appropriate published source) during the Look Back Period in
question.
(d) (i) To the extent that the Investor has not purchased shares
of Common Stock in an aggregate Dollar Amount equal to $2,333,333 on or before
one year from the date of this Agreement for any reason (other than the
Investor's breach of this Agreement and then only to the extent of such breach),
additional Warrants shall be issued within ten days thereafter to the Investor
as follows. The number of Warrants to be so issued shall be equal to 12% of the
difference between (x) $2,333,333 and (y) the aggregate Dollar Amount of Common
Stock purchased by the Investor on or prior to such one year anniversary
(including any amounts withheld by the Investor pursuant to Section 1.4(b)),
divided by (z) 77% of the Lowest Sale Price for the Common Stock on the
Principal Market as reported by Bloomberg (or other appropriate published
source) during the ten trading days prior to such one year anniversary. The
initial exercise price of such Warrants shall be equal to the lower of (A) 94%
of the average closing bid price for the Common Stock on the Principal Market as
reported by Bloomberg (or other appropriate published source) during the ten
trading days prior to such one year anniversary and (B) 94% of the average of
the Monthly Closing Prices (as defined below) for any months in the year ending
on such one year anniversary with respect to which no Shares were purchased by
the Investor. The term Monthly Closing Price means the average closing bid price
for the Common Stock on the Principal Market as reported by Bloomberg (or other
appropriate published source) during the last ten trading days of the calendar
month in question.
(ii) To the extent that the Investor has not purchased shares
of Common Stock in an aggregate Dollar Amount equal to $4,666,667 on or before
two years from the date of this Agreement for any reason (other than the
Investor's breach of this Agreement and then only to the extent of such breach),
additional Warrants shall be issued within ten days thereafter to the Investor
as follows. The number of Warrants to be so issued shall be equal to 12% of the
difference between (x) $4,666,667 and (y) the aggregate Dollar Amount of Common
Stock purchased by the Investor on or prior to such two year anniversary
(including any amounts withheld by the Investor pursuant to Section 1.4(b)),
divided by (z) 77% of the Lowest Sale Price for the Common Stock on the
Principal Market as reported by Bloomberg (or other appropriate published
source) during the ten trading days prior to such two year anniversary. The
initial exercise price of such Warrants shall be equal to the lower of (A) 94%
of the average closing bid price for the Common Stock on the Principal Market as
reported by Bloomberg (or other appropriate published source) during the ten
trading days prior to such two year anniversary and (B) 94% of the average of
the Monthly Closing Prices for any months in the year ending on such two year
anniversary with respect to which no Shares were purchased by the Investor.
(iii) To the extent that the Investor has not purchased
shares of Common Stock in an aggregate Dollar Amount equal to $7,000,000 on or
before three years from the date of this Agreement for any reason (other than
the Investor's breach of this Agreement and then
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only to the extent of such breach), additional Warrants shall be issued within
ten days thereafter to the Investor as follows. The number of Warrants to be so
issued shall be equal to 12% of the difference between (x) $7,000,000 and (y)
the aggregate Dollar Amount of Common Stock purchased by the Investor on or
prior to such three year anniversary (including any amounts withheld by the
Investor pursuant to Section 1.4(b)), divided by (z) 77% of the Lowest Sale
Price for the Common Stock on the Principal Market as reported by Bloomberg (or
other appropriate published source) during the ten trading days prior to such
three year anniversary. The initial exercise price of such Warrants shall be
equal to the lower of (A) 94% of the average closing bid price for the Common
Stock on the Principal Market as reported by Bloomberg (or other appropriate
published source) during the ten trading days prior to such three year
anniversary and (B) 94% of the average of the Monthly Closing Prices for any
months in the year ending on such three year anniversary with respect to which
no Shares were purchased by the Investor.
On each Closing Date subsequent to the issuance of Warrants pursuant to
this Section 1.4(d), notwithstanding the provisions of Section 1.4(c) above, the
Company shall only be obligated to issue Warrants pursuant to Section 1.4(c) at
such times as and to the extent that the total Dollar Amount of Common Stock
purchased by the Investor exceeds the Dollar Amount set forth in the clause
pursuant to which the Warrants were issued, in each case including any amounts
withheld by the Investor pursuant to Section 1.4(c). For example, if Warrants
are issued pursuant to clause (i) above, then no Warrants shall thereafter be
issuable pursuant to Section 1.4(c) until such time as the aggregate Dollar
Amount of Common Stock purchased by the Investor pursuant to this Agreement
exceeds $2,500,000.
Section 1.5. Registration.
(a) The Company agrees that all shares of Common Stock issued to
the Investor pursuant to this Agreement shall, at the time of such issuance and
for so long thereafter as is required by this Agreement, be subject to an
effective registration statement covering the resale or other disposition of
such shares thereof by the Investor at any time and from time to time after each
such issuance and, with respect to the Warrant Shares, covering the resale or
other disposition by the holders of the Warrant Shares at any time and from time
to time after each such issuance for so long as is required by this Agreement.
The shares of Common Stock to be issued to the Investor pursuant to this
Agreement and any Warrant Shares are collectively referred to as the "Shares."
The Company agrees that the registration statement described in this Section
1.5(a) (together with all amendments and supplements thereto, including any
additional registration statements filed in accordance with Section 1.5(b)
below, the "Registration Statement") shall, in accordance with Section 1.5(c)
below, remain effective pursuant to the provisions of the Securities Act of
1933, as amended (the "Securities Act"), or otherwise, (x) in the case of any
Shares issued pursuant to this Agreement at all times during the term of this
Agreement and for a period of 120 days thereafter and (y) in the case of any
Warrant Shares at all times during the term of the Warrants and for a period of
three years thereafter (as applicable, the "Registration Period").
(b) The Company shall use its best efforts in order that the
Registration Statement may become effective within 30 days of the date of this
Agreement. The Registration
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Statement shall register at least 50% of the number of shares of Common Stock
and 100% of the number of Warrant Shares issuable during the term of this
Agreement. In the event that the Company has not initially registered all shares
of Common Stock issuable under this Agreement, a new registration statement
shall be filed covering the remaining shares of Common Stock, and the Company
shall use its best efforts in order that the new registration statement may
become effective within 60 days of the first anniversary of this Agreement.
(c) The Company shall, as expeditiously as reasonably possible
and in accordance with Section 1.5(a) herein:
(i) Prepare and file with the Securities and Exchange
Commission (the "SEC") such amendments and supplements to such Registration
Statement and the prospectus used in connection therewith as may be necessary to
comply with this Agreement and the provisions of the Securities Act with respect
to the disposition of all securities covered by such Registration Statement.
(ii) Furnish to the Investor and any Warrant Holders, as the
case may be, such numbers of conformed copies of the Registration Statement and
of each amendment and supplement thereto (in each case including all exhibits
and documents incorporated by reference), such number of copies of the
prospectus contained in the Registration Statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed under Rule
424 promulgated under the Securities Act, and such other documents as the
Investor and Warrant Holders, as the case may be, may reasonably require in
order to facilitate the disposition of shares sold pursuant to this Agreement or
issued pursuant to the Warrants.
(iii) Insure that all Shares subject to the Registration
Statement shall at all times during the applicable Registration Period be
registered and qualified under such other securities or "Blue Sky" laws of such
jurisdictions as shall be requested by the Investor and/or the Warrant Holders,
as the case may be, provided that the Company shall not be required in
connection herewith or as a condition hereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions.
(iv) Notify the Investor and/or any Warrant Holders of (A)
the happening of any event or the existence of any circumstance as a result of
which the prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing and as soon as may be
practicable prepare and file with the SEC such amendments and supplements to
such Registration Statement and prospectus used in connection therewith as may
be necessary to eliminate or correct such untrue statement or omission and
otherwise to cause such Registration Statement and prospectus to remain current
and useable for the purposes intended hereunder; (B) receipt of any request by
the SEC or any other federal or state governmental authority for additional
information, amendments or supplements to the Registration Statement or related
prospectus; (C) the issuance by the SEC or any other federal or state
governmental authority of
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any stop order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose; or (D) receipt of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose.
(v) Make available for inspection by the Investor's
designated representatives upon request from time to time, all documents filed
by the Company with the SEC (including any documents which may be filed pursuant
to the Exchange Act), require the Company's employees to supply all information
reasonably required by the Investor's designated representatives in connection
with the Registration Statement, require the Company's employees to meet with
representatives of the Investor's designated representatives during normal
business hours and on such basis as the Investor's designated representatives
may reasonably request, and make available to the Investor's designated
representatives, contemporaneously with the provision of such information, any
and all information about the Company provided by the Company to securities
analysts. In addition, the Company will permit the Investor's designated
representatives access to the Company's premises and personnel, consultants,
agents, attorneys, accountants, customers, suppliers, bankers and others who
have significant relationships or agreements with the Company and the Company's
assets, books and records and the Company will provide the Investor's designated
representatives with information (financial and otherwise) concerning the
Company to enable the Investor's designated representatives to conduct
reasonably appropriate ongoing due diligence review of the Company. The Company
will disseminate to the Investor's designated representatives all press releases
and public information disseminated by the Company at the same time it
disseminates such releases and information to others.
(vi) Except as required, in the opinion of the Company's
counsel, by law or consented to in advance by the Investor (which consent shall
not be unreasonably withheld), refrain from using the name of the Investor in
the Registration Statement or other regulatory filings (including the SEC
Documents).
(vii) The Company shall enter into reasonably customary
agreements and take such other actions as are reasonably required in order to
expedite or facilitate the disposition of the Shares (whereupon the Investor
and/or the Warrant Holders, as the case may be, may at their option require that
any or all of the representations, warranties and covenants of the Company also
be made to and for the benefit of the Investor and/or the Warrant Holders, as
the case may be).
(d) (i) The Company shall indemnify, defend and hold harmless the
Investor and Warrant Holders and each of their respective officers, directors,
partners, employees, agents and counsel and each person, if any, who controls
any such person within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (each, an "Indemnified Party") from and against,
and shall reimburse the Indemnified Parties with respect to, any and all claims,
suits, demands, causes of action, losses, damages, liabilities, costs or
expenses ("Liabilities") to which such Indemnified Parties may become subject
under the Securities Act or otherwise, arising from or relating to (A) any
untrue statement or alleged untrue
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statement of any material fact contained in the Registration Statement or any
prospectus contained therein or (B) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading; provided, however, that the Company shall not be liable in any such
case to the extent that any such Liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission so
made in conformity with information furnished by the Investor or any Warrant
Holder in writing specifically for use in the preparation thereof.
(ii) The Investor and/or the Warrant Holder, as the case may
be, shall indemnify, defend and hold harmless the Company and each of its
respective officers, directors, partners, employees, agents and counsel and each
person, if any, who controls any such person within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act (each, an "Indemnified
Party") from and against, and shall reimburse the Indemnified Parties with
respect to, any and all Liabilities to which such Indemnified Parties may become
subject under the Securities Act or otherwise, arising from or relating to (A)
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement or any prospectus contained therein or (B) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, in each case to the
extent and only to the extent that any such Liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission so made in conformity with information furnished by the Investor or the
Warrant Holder, as the case may be, in writing specifically for use in the
preparation thereof. In addition, if a Registration Statement is suspended by
the SEC as a result of any untrue statement of a material fact intentionally
made by the Investor in the Registration Statement, then the Investor shall
indemnify, defend and hold harmless the Company from losses actually incurred by
the Company (excluding any speculative or consequential damages or damages for
loss of profits or lost opportunities) from its failure to be able to require
purchases of Common Stock under this Agreement during the period of such
suspension provided that the Company proves that (a) it would have required such
purchases and (b) no alternative sources of financing were available.
(iii) Promptly after receipt by an Indemnified Party of
notice of the commencement of any action, the Indemnified Party shall, if a
claim in respect thereof is to be made against the other party (the
"Indemnifying Party") hereunder, notify the Indemnifying Party in writing
thereof, but the omission so to notify the Indemnifying Party shall not relieve
the Indemnifying Party from any Liability which it may have to any Indemnified
Party other than under this section and shall only relieve it from any Liability
which it may have to the Indemnified Party under this section if and to the
extent the Indemnifying Party is materially prejudiced by such omission. In case
any such action shall be brought against an Indemnified Party and the
Indemnified Party shall notify the Indemnifying Party of the commencement
thereof, the Indemnifying Party shall be entitled to participate in the defense
thereof with counsel reasonably satisfactory to the Indemnified Parties. If the
Investor is a defendant in such action, the Investor shall select separate
counsel to represent the Investor and all Indemnified Parties; however, if the
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Investor is not a defendant, such separate counsel shall be selected by the
majority of the Indemnified Parties named as defendants; in each case the fees
and expenses of such counsel and other expenses related to the action shall be
reimbursed by the Indemnifying Party as such fees and expenses are incurred. The
legal fees and expenses of any Indemnified Party choosing not to be represented
by such separate counsel selected by the Investor or the majority of the
Indemnified Parties, as the case may be, shall be borne by such Indemnified
Party.
(e) If the indemnification provided for in Section 1.5(d) above
is unavailable to an Indemnified Party in respect of any Liabilities, then the
Indemnifying Party, in lieu of indemnifying the Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Liabilities such proportion of such Liabilities as is appropriate to
reflect the relative fault of the Indemnifying Party and of the Indemnified
Party in connection with such statements or omissions described in Section
1.5(d)(i) or (ii) above, as well as any other relevant equitable considerations.
The relative fault of the Indemnifying Party and of the Indemnified Party shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Indemnifying Party or by
the Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
"Liabilities" pursuant to this Section 1.5(e) and Section 1.5(d) shall be deemed
to include without limitation any legal or other expenses reasonably incurred by
the Indemnified Parties in connection with investigating or defending any action
or claim by a third party and in connection with any enforcement of this Section
1.5(e) and Section 1.5(d).
(f) (i) All legal, accounting and other fees, costs and expenses
of and incidental to the Registration Statement (including without limitation
the fees, costs and expenses of the Investor's designated representatives as
provided in Section 1.5(c)(v) and the fees, costs and expenses of the Investor's
counsel) shall be borne by the Company (other than such fees, costs and expenses
as are in the nature of commissions incurred in connection with the sale of
Shares by the Investor or any Warrant Holder). The Company shall pay such
advances and retainers toward such expenses as the Investor may from time to
time reasonably request.
(ii) The fees, costs and expenses to be borne by the Company
as provided in this subsection (f) shall include, without limitation, all
registration, filing and NASD fees, printing expenses, fees and disbursements of
counsel and accountants for the Company and all legal fees and disbursements and
other expenses of complying with state securities or "Blue Sky" laws of any
jurisdiction or jurisdictions in which securities to be offered are to be
registered and qualified. The Company shall pay such advances and retainers
toward such expenses as the Investor may from time to time reasonably request.
Section 1.6 Distributions. In the event the Company delivers a Put
Notice, the Company shall not make any distributions to its shareholders
(including without limitation any rights to purchase securities or properties)
or have any record dates with respect thereto from the beginning of the Look
Back Period until five business days after the Closing.
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Section 1.7 Delisting and Registration Statement Suspension. If within
60 days after a Closing the Common Stock is delisted from or is no longer
eligible to be traded on the then Principal Market or the Common Stock is not
registered under the Exchange Act, the Investor shall have the right, at its
option in its sole discretion, which right shall be exercised within 30 days of
such delisting or deregistration, to sell to the Company, and the Company agrees
to buy, promptly upon the exercise of such right by the Investor, a number of
Shares up to the number of the Shares purchased by the Investor at such Closing
and the immediately prior Closing at a price equal to the purchase price
therefor, as well as all Warrants then held by the Investor and/or the Warrant
Holders at a price equal to the average closing sales prices for the Common
Stock on the Principal Market as reported by Bloomberg (or other appropriate
published source) for the five trading days prior to the commencement of the
event in question (less any applicable exercise price for unexercised Warrants).
In addition if at any time during the Registration Period the Registration
Statement is not effective for a five-day period or if the Investor and/or the
Warrant Holders are not otherwise able to sell their Shares pursuant to the
Registration Statement for a five-day period or trading is halted in the Common
Stock for more than a five-day period, then the Investor and/or the Warrant
Holders, as the case may be, shall have the right, at their option in their sole
discretion, which right shall be exercised within 90 days after such five-day
period to sell to the Company, and the Company agrees to buy, promptly upon the
exercise of such right, all or any part of the Shares then held by the Investor
and/or the Warrant Holders, as the case may be, and/or the Warrants held by the
Warrant Holders at a price equal to the average closing sales prices for the
Common Stock on the Principal Market as reported by Bloomberg (or other
appropriate published source) for the ten trading days prior to the commencement
of the event in question (less any applicable exercise price for unexercised
Warrants).
ARTICLE 2
Representations and Warranties
Section 2.1 Representations and Warranties of the Company. The Company
makes the following representations and warranties to the Investor as of the
date hereof and as of each Closing Date:
(a) Organization and Qualification. The Company is a corporation
duly incorporated in and existing in good standing under the laws of the State
of Nevada and has the requisite corporate power to own its properties and to
carry on its business as now being conducted. Each of the Company and its
subsidiaries is duly qualified as a foreign corporation to do business and is in
good standing in every jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary and where
the failure to so qualify would have a Material Adverse Effect. "Material
Adverse Effect" means any adverse effect on the operations, properties,
prospects or financial condition of the Company and/or any of its subsidiaries
which is material to the Company and its subsidiaries taken as a whole.
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(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and perform this Agreement and to
issue all Shares and Warrants in accordance with the terms hereof and thereof.
The execution and delivery of this Agreement and the Warrants by the Company and
the consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate action, and no further consent or
authorization of the Company or its Board of Directors or stockholders is
required. This Agreement has been and the Warrants will be duly executed and
delivered by the Company. This Agreement constitutes and the Warrants will
constitute a valid and binding obligation of the Company enforceable against the
Company in accordance with their respective 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. As of ____________, 1998, the authorized
capital stock of the Company and the shares thereof currently issued and
outstanding (and shares subject to issuance upon outstanding options, warrants,
purchase agreements and rights and/or convertible securities) were as follows:
_______________________________________. All of the outstanding shares of Common
Stock have been validly issued and are fully paid and non-assessable. No shares
of Common Stock are entitled to preemptive rights. The Company owns 100% of the
equity securities of any of its subsidiaries, and no other person has the right
(contingent or otherwise) to acquire any such securities.
(d) Issuance of Shares. The issuance of all Shares and Warrants
to be issued hereunder has been duly authorized and all such Shares, when paid
for and issued in accordance with the terms hereof and the Warrants, shall be
validly issued, fully paid and non-assessable. The Company has authorized and
reserved and will continue to reserve for issuance the requisite number of
shares of Common Stock to be issued pursuant to the Warrants.
(e) Agreements. There has been no breach or default by the
Company or by any other party thereto of any provisions of any material
agreements to which the Company is a party which would result in a Material
Adverse Effect, and nothing has occurred which, with lapse of time or the giving
of notice of both, would constitute such a breach or default by the Company by
any other party thereto.
(f) Brokers. The Investor shall not be responsible for any fees
of any broker, finder, commission agent or other person employed by the Company
in connection with this Agreement and the transactions contemplated hereby.
(g) No Conflicts. The execution, delivery and performance of this
Agreement and the Warrants by the Company and the consummation by the Company of
the transactions contemplated hereby and thereby do not and will not (i) result
in a violation of the Company's charter documents or by-laws or (ii) conflict
with, or constitute a default (or an event which with notice or lapse of time or
both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument
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to which the Company is a party, or result in a violation of any Federal, state,
local or foreign law, rule, regulation, order, judgment or decree (including
Federal and state securities laws and regulations) applicable to the Company or
by which any property or asset of the Company is bound or affected (except for
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 Company is not being conducted in violation
of any law, ordinance or regulations of any governmental entity, except for
violations which either singly or in the aggregate do not have a Material
Adverse Effect. The Company is not required under law, rule or regulation to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under this Agreement or issue and sell
any shares in accordance with the terms hereof or to enable the Investor to sell
Shares on the Principal Market (other than the filing and effectiveness of the
Registration Statement and compliance with applicable state securities or "Blue
Sky" laws).
(h) SEC Documents, Financial Statements. Upon the effectiveness
of the Registration Statement and at all times thereafter, the Common Stock will
be registered pursuant to Section 12 of the Exchange Act, and the Company will
timely file all reports, schedules, forms, statements and other documents,
together with all exhibits, financial statements and schedules thereto, required
to be filed by it with the SEC pursuant to the reporting requirements of the
Exchange Act, including material filed pursuant to Section 13(a) or 15(d) (all
of the foregoing, including materials filed with the SEC and the Registration
Statement, when declared effective and as it may be amended from time to time,
being hereinafter referred to herein as the "SEC Documents"). As of their
respective dates, the SEC Documents will comply in all material respects with
the requirements of the Exchange Act or the Securities Act, as the case may be,
and the rules and regulations of the SEC promulgated thereunder and other
Federal, state and local laws, rules and regulations applicable to such SEC
Documents, and none of the SEC Documents will contain any untrue statement of a
material fact or will omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. As of the date of
delivery by the Investor and/or a holder of Warrant Shares of the prospectus
contained in the Registration Statement in connection with sales of Shares by
the Investor and/or holder of Warrant Shares, such prospectus will comply in all
material respects with the requirements of the Securities Act and the rules and
regulations of the SEC promulgated thereunder, and other Federal, state and
local laws, rules and regulations applicable to such prospectus. The financial
statements of the Company included in the SEC Documents will comply as to form
in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC or other applicable rules and
regulations with respect thereto. Such financial statements will be prepared in
accordance with generally accepted accounting principles applied on a consistent
basis during the periods involved (except (x) as may be otherwise indicated in
such financial statements or the notes thereto or (y) in the case of unaudited
interim statements, to the extent they may not include footnotes or may be
condensed or summary statements) and will fairly present in all material
respects the financial position of the Company as of the dates thereof and the
results of operations
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and cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).
(i) There is not in effect any agreement by the Company pursuant
to which any holders of securities of the Company have a right to cause the
Company to register or qualify such securities under the Securities Act or any
securities or blue sky laws of any jurisdiction.
(j) The SEC has not issued an order preventing or suspending the
use of any prospectus relating to the offering of any Shares nor instituted
proceedings for that purpose.
(k) No Material Adverse Change. No Material Adverse Effect has
occurred or exists with respect to the Company since the date of this Agreement.
(l) No Undisclosed Events or Circumstances. No material event or
circumstance has occurred or exists with respect to the Company or its business,
properties, prospects, operations or financial condition which should be
disclosed by the Company under the Exchange Act or other applicable law if the
Company were selling Common Stock but which has not been so publicly announced
or disclosed.
(m) There has been no material adverse change in the number
and/or stature of firms making a market in the Common Stock since the date of
this Agreement.
Section 2.2 Representations and Warranties of the Investor. The Investor
makes the following representations and warranties to the Company as of the date
hereof and as of each Closing Date:
(a) Authorization; Enforcement. The Investor is duly organized
and validly existing under the laws of the State of Delaware. The Investor has
the requisite power and authority to enter into and perform this Agreement and
to purchase the Shares to be sold hereunder. The execution and delivery of this
Agreement by the Investor and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary corporate or
other action, and no further consent or authorization of the Investor is
required. This Agreement has been duly authorized, executed and delivered by the
Investor. This Agreement constitutes a valid and binding obligation of the
Investor enforceable against the Investor in accordance with its terms, except
as 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.
(b) No Conflicts. The execution, delivery and performance of this
Agreement and the consummation by the Investor of the transactions contemplated
hereby or relating hereto do not and will not (i) result in a violation of the
Investor's charter documents or (ii) conflict with, or constitute a default (or
an event which with notice of lapse of time or both would become a default)
under, or give to others any rights of termination, amendment, acceleration or
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cancellation of, any agreement, indenture or instrument to which the Investor is
a party, or result in a violation of any law, rule, or regulation, or any order,
judgment or decree of any court or governmental agency applicable to the
Investor or any of its properties (except for such conflicts, defaults and
violations as would not individually or in the aggregate have a material adverse
effect on the Investor or a Material Adverse Effect on the Company or the
transactions contemplated hereunder). The Investor is not required to obtain any
consent, authorization or order of, or make any filing or registration with, any
court or governmental agency in order for it to execute, deliver or perform any
of its obligations under this Agreement or purchase securities in accordance
with the terms hereof.
(c) Opportunity for Review. The Investor has been afforded, to
the satisfaction of the Investor, the opportunity to review the SEC Documents
and obtain such additional information concerning the Company and its business,
and to ask such questions and receive such answers, as the Investor deems
necessary to make an informed investment decision and to evaluate the merits and
risks of entering into this Agreement.
(d) Investment Representation. The Investor is an "accredited
investor" as that term is defined by the Securities Act. The Investor is
purchasing the shares of Common Stock and the Warrants for its own account. The
Investor has no present intention to sell any such securities (or shares of
Common Stock issuable upon exercise of the Warrants) except in compliance with
the Securities Act.
ARTICLE 3
Covenants
Section 3.1 Securities Compliance.
(a) The Company shall notify the SEC and the Principal Market and
any other applicable market in accordance with their requirements, if any, of
the transactions contemplated by this Agreement and shall take all other
necessary action and proceedings as may be required by applicable law, rule and
regulation for the legal and valid issuance of all securities to be issued to
the Investor hereunder.
(b) The Company will cause its Common Stock to continue to be
registered under Section 12 of the Exchange Act, will comply in all material
respects with its reporting and filing obligations under said Act, will comply
with all requirements related to the Registration Statement, and will not take
any action or file any document (whether or not permitted by said Act or the
rules thereunder) to terminate or suspend such Registration Statement or to
terminate or suspend its reporting and filing obligations under the Exchange
Act, expect as permitted herein. The Company will take all action necessary to
continue the listing or trading of its Common Stock on the Principal Market and
will comply in all material respects with the Company's reporting, filing and
other obligations under the bylaws or rules of the Principal Market.
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(c) The Company will file in a timely manner information,
documents and reports in compliance with the Securities Act and the Exchange Act
and will, at its expense, promptly take such further action as holders of Shares
and/or holders of Warrants may reasonably request to enable such holders to sell
Shares without registration under the Securities Act within the limitation of
the exemptions provided by (i) Rule 144 under the Securities Act ("Rule 144"),
as such Rule may be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the SEC. If at any time the Company is not
required to file such reports, it will, at its expense, forthwith upon the
written request of any holder of Shares, make available adequate current public
information with respect to the Company within the meaning of paragraph (c)(2)
of Rule 144 or such other information as may be necessary to permit sales
pursuant to Rule 144. Upon the request of the Investor, the Company will deliver
to the Investor a written statement, signed by the Company's principal financial
officer, as to whether it has complied with such requirements.
Section 3.2 Preliminary Put Notice. The Company shall deliver to the
Investor, at least seven calendar days prior to the delivery of each Put Notice,
a preliminary Put Notice which notice shall state that the Company is
considering delivery of a Put Notice to the Investor ten or more calendar days
following delivery of the preliminary Put Notice and the maximum Dollar Amount
of such Put Notice. In no event shall delivery of a preliminary Put Notice to
the Investor obligate the Company to deliver any Put Notice to the Investor, but
any Put Notice so delivered shall not require the Investor to purchase a Dollar
Amount greater than the amount set forth in such preliminary Put Notice.
Notwithstanding anything to the contrary contained in this Agreement, the
Investor shall have the right to decline to purchase the Common Stock which the
Investor would otherwise be required to purchase under any two Put Notices
designated by the Investor in any 12 month period.
ARTICLE 4
Conditions
Section 4.1 Conditions Precedent to the Obligation of the Company to
Issue Shares. The obligation hereunder of the Company to issue shares of Common
Stock hereunder to the Investor is further subject to the satisfaction at or
before each Closing of each of the following conditions set forth below. These
conditions are for the Company's sole benefit and may be waived by the Company
at any time in its sole discretion.
(a) Accuracy of the Investor Representations and Warranties. The
representations and warranties of the Investor shall be true and correct in all
material respects as of the date when made and as of the date of each Closing
Date as though made at that time.
(b) Performance by the Investor. The Investor shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Investor at or prior to such Closing.
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(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
Section 4.2 Conditions Precedent to the Obligation of the Investor to
Purchase any Shares. The obligation of the Investor to purchase any Shares under
this Agreement is subject to the satisfaction, at or before each Closing, of
each of the following conditions set forth below. These conditions are for the
Investor's sole benefit and may be waived by the Investor at any time in its
sole discretion.
(a) Accuracy of the Company's Representations and Warranties. The
representations and warranties of the Company shall be true and correct in all
material respects as of the date when made and as of each Closing Date as though
made at that time (except for representations and warranties that speak as of a
particular date or refer to a particular point in time).
(b) Performance by the Company. The Company shall have performed,
satisfied and complied in all material respects with all covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to such Closing.
(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
(d) No Adverse Change and Proper Disclosure. There shall have
been no adverse change in the business, assets, liabilities or prospects of the
Company since the date of this Agreement which the Investor reasonably believes
could have a Material Adverse Effect. The Investor shall not have advised the
Company that the Investor believes in good faith that the disclosures contained
in the Registration Statement may not comply with applicable law.
(e) Principal Market. Trading in the Company's Common Stock shall
not have been suspended by the SEC or the Principal Market, and trading in
securities generally as reported by the Principal Market shall not have been
suspended or limited or minimum prices shall not have been established on
securities whose trades are reported by the Principal Market.
(f) Opinion of Counsel, Etc. At each Closing the Investor shall
have received an opinion of counsel to the Company, which counsel shall be
reasonably satisfactory to the Investor, dated the effective date of such
Closing concerning such matters as the Investor shall reasonably request, a copy
of a "cold comfort" letter addressed to the Company from an accounting firm
satisfactory to the Investor, dated the effective date of such Closing
concerning such matters as the Investor shall reasonably request, and such other
certificates, opinions of other
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counsel, and documents as the Investor or its counsel shall reasonably request
incident to such Closing. The form of all such certificates, opinions, "cold
comfort" letters and other documents shall be satisfactory to the Investor.
(g) Effectiveness of Registration Statement. The Registration
Statement covering the Shares previously issued to the Investor (to the extent
the Investor has not disposed of such Shares in accordance with the Registration
Statement) and the Warrant Shares underlying the Warrants previously issued to
the Investor (to the extent the Investor has not disposed of such Warrant Shares
in accordance with the Registration Statement) and covering the Shares and the
Warrant Shares underlying the Warrants to be issued at the Closing shall be
effective at the time of each Closing and no stop order suspending the
effectiveness of the Registration Statement shall have been instituted, be
pending or be threatened.
(h) Accuracy of Registration Statement. The Registration
Statement (including information or documents incorporated by reference therein)
and any amendments or supplements thereto shall not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(i) Officers' Certificate. At each Closing the Investor shall
have received certificates from the CEO and the CFO of the Company concerning
such matters as the Investor shall reasonably request incident to such Closing.
The form of such certificates shall be satisfactory to the Investor.
ARTICLE 5
Miscellaneous
Section 5.1 Fees and Expenses. The Company shall pay the legal and other
fees and expenses of the Investor in connection with the negotiation,
preparation, execution, delivery and performance of this Agreement, which are
agreed to be $10,000 for services through the date of this Agreement. The
Company shall pay all stamp and other taxes and duties levied in connection with
the issuance of any Shares issued pursuant hereto.
Section 5.2 Specific Enforcement; Consent to Jurisdiction.
(a) The Company and the Investor acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties shall be entitled
to an injunction or injunctions to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof, this
being in addition to any other remedy to which either of them may be entitled by
law or equity.
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(b) Except as hereinafter provided, each of the Company and the
Investor (i) hereby irrevocably submits to the exclusive jurisdiction of the
Federal and state courts in Los Angeles County, California for the purposes of
any suit, action or proceeding arising out of or relating to this Agreement and
(ii) hereby waives, and agrees not to assert in any such suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that the suit, action or proceeding is brought in an
inconvenient forum or that the venue of the suit, action or proceeding is
improper. Notwithstanding the foregoing, at the option of the Investor, all
controversies, claims, disputes or counterclaims arising under or relating to
Section 1.4(d) of this Agreement, whether they involve a disagreement about its
meaning, interpretation, application, performance, breach, termination,
enforceability or validity and whether based on statute, tort, contract, common
law or otherwise (a "Dispute") shall be arbitrable (an "Arbitration"). Any such
Arbitration shall be conducted in Los Angeles, California by the American
Arbitration Association, and the judgment rendered by the arbitrator may be
entered in any court having jurisdiction thereof. Any such Arbitration shall
commence within 14 days of the date of filing a demand for arbitration, and the
arbitrator shall render his or her decision within 30 days of the date of filing
a demand for arbitration. In any such Arbitration, the arbitrator, who shall be
a certified public accountant, shall determine all questions or arbitrability,
including, without limitation, the scope of this agreement to arbitrate a
Dispute, whether an agreement to arbitrate exists and if so whether it covers
the Dispute in question or any other form of disagreement or conflict among the
parties to this Agreement whether such Dispute existed, prior to or arises after
the date of this Agreement.
Any such Arbitration shall be administered by the American
Arbitration Association in accordance with its Commercial Arbitration Rules. The
arbitrator, shall have no power to order discovery. The arbitration award shall
be in writing. The arbitrator may not make any ruling, finding or award that
does not conform to the terms and conditions of this Agreement. The arbitrator
shall have the authority to award any remedy or relief that a court of the State
of California could order or grant, including, without limitation, specific
performance of any obligation created under Section 1.4(d) of this Agreement
(including specific performance of the issuance of the Warrants provided for
thereunder). To the extent that the Company has not timely issued Warrants to
the Investor in accordance with Section 1.4(d) above, in any such Arbitration
the arbitrator shall order the Company to issue such Warrants at an exercise
price equal to the lower of the exercise price specified in Section 1.4(d) and a
price equal to 94% of the average closing bid price for the Common Stock on the
Principal Market as reported by Bloomberg (or other appropriate published
source) during the ten trading days prior to the date the Warrants are actually
issued by the Company, which date shall be no later than ten days after the date
or the arbitrator's ruling, finding or award. The arbitrator is empowered to
award damages in excess of compensatory damages, including punitive damages. The
parties and the arbitrator may not disclose the existence, content or results of
any Arbitration hereunder without the prior written consent of all of the
parties, except as required by the Civil Code of Procedure of California Section
1281-9 or as required by applicable law.
Each of the Company and the Investor consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address in effect for
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notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing in this
paragraph shall affect or limit any right to serve process in any other manner
permitted by law. The prevailing party in any such suit, action or proceeding
shall be entitled to attorney's fees and costs.
Section 5.3 Entire Agreement; Amendments. This Agreement contains the
entire understanding of the parties with respect to the transactions
contemplated hereby and, except as specifically set forth herein, neither the
Company nor the Investor makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may be
waived or amended other than by a written instrument signed by the party against
whom enforcement of any such amendment or waiver is sought.
Section 5.4 Notices. Any notice or other communication required or
permitted to be given hereunder shall be in writing and shall be effective upon
hand delivery or delivery by facsimile at the address or number designated below
(if delivered on a business day during normal business hours where such notice
is to be received). The addresses for such communications shall be:
to the Company: Jaws Technology, Inc.
000 0xx Xxxxxx XX, Xxxxx 000
Xxxxxxx, Xxxxxxx Xxxxxx X0X 0X0
Attn:___________________
Facsimile No. (___) _______
with copies to: Jeffer, Mangels, Xxxxxx & Xxxxxxx LLP
2121 Avenue of the Stars, Xxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile No. (000) 000-0000
to the Investor: Bristol Asset Management V LLC
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Facsimile No. (000) 000-0000
with copies to: Christensen, Miller, Fink, Jacobs,
Xxxxxx, Weil & Xxxxxxx, LLP
2121 Avenue of the Stars, l8th fl.
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Facsimile No. (000) 000-0000
Either party hereto may from time to time change its address for notices under
this Section 5.4 by giving written notice of such changed address to the other
party hereto.
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Section 5.5 Waivers. No waiver by either party 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
provisions, 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. The parties hereto waive any and
all rights to a jury trial in connection with any action or proceeding arising
under this Agreement or the transactions contemplated hereby.
Section 5.6 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.
Section 5.7 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties and their permitted successors and
permitted assigns. The parties hereto may amend this Agreement without notice to
or the consent of any third party. Neither the Company nor the Investor shall
assign this Agreement or any rights or obligations hereunder without the prior
written consent of the other (which consent may be withheld for any reason in
the sole discretion of the party from whom consent is sought).
Section 5.8 No Third Party Beneficiaries. This Agreement is intended for
the benefit of the parties hereto and the holders of Warrants and their
respective permitted successors and assigns and is not for the benefit of, nor
may any provisions hereof be enforced by, any other person other than a holder
of Warrants. Notwithstanding the foregoing, this Agreement may be amended
(and/or requirements hereunder may be waived) from time to time by the Company
and the Investor.
Section 5.9 Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of California,
without regard to the principles of conflict of laws.
Section 5.10 Execution. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart.
Section 5.11 Publicity and Confidentiality. The Company and the Investor
shall consult and cooperate with each other in issuing any press releases or
otherwise making public statements with respect to the transactions contemplated
hereby, provided the foregoing shall not interfere with the legal obligations of
either party with respect to public disclosure.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the date hereof.
"The Company"
Jaws Technology, Inc.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title: Secretary
"The Investor"
Bristol Asset Management V LLC
By:
--------------------------------------
Name:
Title:
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EXHIBIT A
Jaws Technology, Inc.
000 0xx Xxxxxx XX, Xxxxx 000
Xxxxxxx, Xxxxxxx Xxxxxx X0X 0X0
--------------------, -----
Bristol Asset Management V LLC
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Gentlemen:
Reference is made to that certain Investment Agreement (the
"Agreement") dated as of August 27, 1998 between you and the undersigned. This
is a Put Notice as that term is defined in Section 1.2 of the Agreement.
This is to advise you that the undersigned will sell to you five
business days (as that term is defined in the Agreement) following the date this
Put Notice is given to you in accordance with Section 5.4 of the Agreement
$______________ of the undersigned's Common Stock.
The undersigned hereby represents that the number of shares of
Common Stock outstanding as of the date hereof and expected to be outstanding as
of five business days after the date hereof, determined in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended, is
_________________.
Very truly yours,
Jaws Technology, Inc.
By
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