EXHIBIT 10.44
DATED November 24, 2004
TCOMM (UK) LIMITED
and
TCOMM LIMITED
and
JAG MEDIA HOLDINGS, INC.
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BUSINESS SALE AGREEMENT
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THIS AGREEMENT is made the 24th day of November, 2004
BETWEEN:
1. TCOMM LIMITED, a company incorporated under the laws of England of 00
Xxxxxx Xxxxxx, Xxxxxx, Xxxx Xxxxxxxxx, XX00 0XX (registered in England
No. 4840591) (the "SELLER"); and
2. TCOMM (UK) LIMITED, a company incorporated under the laws of England of
00-00 Xxxxxxx Xxx, Xxxxxx XX0X 0XX (registered in England No. 5272730)
(the "PURCHASER"); and
3. JAG MEDIA HOLDINGS, INC., a Nevada corporation of 0000 XX 00xx Xxxxxx,
Xxxxx X00, Xxxx Xxxxx, XX 00000 ("JAG").
WHEREAS:
(A) The Seller carries on the Business (as defined in this agreement) and
is the beneficial owner or is otherwise able to procure the sale of the
Business Assets (as defined in this agreement).
(B) The Seller has agreed to sell (or procure the sale of) and the
Purchaser has agreed to purchase the Business (as defined in this
agreement) comprising the Business Assets (as defined in this
agreement) as a going concern on the terms set out in this agreement.
NOW IT IS AGREED as follows:
1. INTERPRETATION
1.1 In this agreement and the schedules to it:
"ASSUMED OBLIGATIONS" has the meaning given in clause 7;
"BUSINESS" means the business agreed to be sold
under this agreement of software
development and resale carried on by the
Seller as at Completion;
"BUSINESS ACCOUNTS DATE" 30 September 2004;
"BUSINESS ACCOUNTS" means the unaudited financial statements
of the Business from July 2003 to the
Business Accounts Date;
"BUSINESS ASSETS means all the assets relating to the
Business (including all the rights and
property relating to the assets) agreed
to be purchased under this agreement as
set out in Schedule 2;
"BUSINESS GOODWILL" means all the goodwill of the Seller in
relation to the Business;
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"BUSINESS INFORMATION" means all information, know-how and
techniques (whether or not confidential
and in whatever form held) including,
without limitation, all:
(i) formulae, designs, specifications,
drawings, data, manuals and
instructions;
(ii) customer lists, sales, marketing and
promotional information;
(iii) business plans and forecasts; and
(iv) technical or other expertise
relating to the Business;
"BUSINESS INTELLECTUAL means Intellectual Property owned by the
PROPERTY" Seller which relates to the Business and,
in particular, the Intellectual Property
in the Business Proprietary Software;
"BUSINESS PLANT AND means all the plant, machinery and other
MACHINERY" equipment including furniture, spares,
loose tools, computer hardware, fittings,
partitioning and other items owned or to
be owned by or in the Business as at the
Completion Date;
"BUSINESS PROPERTY" means the property located at 00, Xxxxxx
Xxxxxx, Xxxxxx, Xxxx Xxxxxxxxx XX00 0XX,
which is currently used by the Seller to
carry on the Business;
"BUSINESS PROPRIETARY means software used in the Business in
SOFTWARE" which the Seller owns any Intellectual
Property;
"BUSINESS RECORDS" means all books and records containing or
relating to Business Information or on
which the Business Information is
recorded (including, without limitation,
all documents and other material
(including all forms of computer or
machine readable material));
"COMMON STOCK" means 250,000 shares of common stock in
JAG;
"COMPLETION DATE" means the date on which Completion takes
place expected to be 24 November 2004 or
such other date as agreed upon between
the parties;
"COMPLETION" means completion of the sale and purchase
of the Business Assets under this
agreement;
"CONTRACTS" means all the contracts (which include
(amongst other things) all agreements,
arrangements and commitments relating to
the Business current at Completion to
which the Seller is a party or the
benefit of which is held in trust for or
has been assigned to it but excluding
contracts with Employees;
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"EMPLOYEES" means individuals who are employed in the
Business at the date of this agreement by
the Seller as listed in Schedule 4 and
whose contracts of employment shall
transfer pursuant to this agreement;
"INTELLECTUAL PROPERTY" means patents, trade marks, signs and
service marks, rights in designs, trade
or business names or signs, copyrights
(including all rights in computer
software), database rights and topography
rights (whether or not any of these is
registered and including applications for
registration of any such thing) and all
rights or forms of protection of a
similar nature or having equivalent or
similar effect to any of these which may
subsist anywhere in the world;
"REGULATIONS" means the Transfer of Undertakings
(Protection of Employment) Regulations
1981;
"TAX" OR "TAXATION" includes (without limitation) all taxes,
levies, duties, imposts, charges and
withholdings of any nature whatsoever,
whether of the United Kingdom or
elsewhere, together with all penalties,
charges and interest relating to any of
them or to any failure to file any return
required for the purposes of any of them;
"THIRD PARTY CONSENTS" means all consents, approvals,
authorisations or waivers required from
third parties for the transfer of any
Contract in favour of the Purchaser; and
"WARRANTIES" means the representations and warranties
set out in Schedule 3 given by the Seller
and any other representations or
warranties made by or on behalf of the
Seller in this agreement or which have
become terms of this agreement.
1.2 References to the knowledge, information, belief or awareness of any
person shall be treated as including any knowledge, information, belief
or awareness which the person would have if the person had made all
usual and reasonable inquiries.
2. SALE AND PURCHASE
2.1 The Seller agrees to sell or procure the sale of and the Purchaser
agrees to purchase the Business as a going concern and the Business
Assets listed below as at and with effect from Completion:
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2.1.1 the Business Goodwill;
2.1.2 the benefit of the rights vesting in the Business Property;
2.1.3 the Business Plant and Machinery;
2.1.4 the benefit of the Contracts;
2.1.5 the Business Intellectual Property;
2.1.6 the Business Proprietary Software;
2.1.7 all right, title and interest of the Seller in:
2.1.7.1 the Business Information; and
2.1.7.2 all Business Records but excluding;
all other assets not specified above.
2.2 The Seller confirms it has the right to transfer or to procure the
transfer of legal and beneficial title to the Business Assets and,
unless otherwise disclosed in writing to the Purchaser, sells or
procures the sale of the Business Assets free from all liens, charges
and encumbrances and from all other rights exercisable by or claims by
third parties.
2.3 Sub-clause 2.1 shall operate as an assignment of such of the Business
Intellectual Property as is not the subject of a registration or an
application for registration with effect from Completion.
3. CONSIDERATION
3.1 The consideration for the sale of the Business Assets shall be:
3.1.1 US$ 42,500; and
3.1.2 the discharge by the Purchaser of the Seller's obligations to
HSBC Bank plc of (pound)9,866.68 (being compirsed of a loan of
(pound)7.366.68 and an overdraft facility of (pound)2,500)
(the "HSBC DEBT").
3.2 The consideration for the sale of the Business Assets shall be
satisfied in accordance with clause 5.
4. VAT
4.1 The Seller and the Purchaser consider that the transfer of the Business
should for value added tax purposes constitute the transfer to the
Purchaser of all or part of the business of the Seller as a going
concern and should accordingly fall within Article 5 of the Value Added
Tax (Special Provisions) Order 1995 (SI 1995/1268) (Article 5) so as to
be treated as neither a supply of goods nor a supply of services for
the purposes of VAT.
4.2 The Seller represents and warrants to the Purchaser:
4.2.1 that it is registered for the purposes of VAT; and
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4.2.2 that the transfer pursuant to this agreement of the Business
Property would not fall within paragraph (a) of item 1 of
Group 1 of Schedule 9 to the VATA (new buildings, etc.).
4.3 If it has not done so already, the Seller shall forthwith after the
signing of this agreement provide to the Purchaser a certified copy of
its certificate of registration for VAT purposes.
4.4 The Purchaser represents and warrants to the Seller:
4.4.1 that it is, or will become, a registered taxable person for
the purposes of VAT; and
4.4.2 that it intends to use the Business Assets to carry on the
same kind of business as the Business with effect from
Completion.
4.5 If H.M. Customs and Excise rule in writing that the transfer of the
Business pursuant to this agreement does not fall within the provisions
of Article 5 then the Seller shall notify the Purchaser of such ruling
immediately upon its being so advised by H.M. Customs and Excise and
the Purchaser shall, in addition to the consideration, pay to the
Seller (against the production of a valid VAT invoice and a certified
copy of the ruling) the amount of any VAT which is chargeable in
respect of the transfer of the Business:
4.5.1 if the ruling is received before the latest date (the "VAT
PAYMENT DATE") on which the Seller may furnish a VAT return
(without incurring any interest or penalty) for the prescribed
accounting period (as defined in regulations 2(1) and 99(1) of
the Value Added Tax Regulations 1995 (SI 1995/2518)) of the
Seller in which Closing falls, on the VAT Payment Date; or
4.5.2 if later, or in any other case, within ten Business Days of
demand by the Seller
PROVIDED THAT the Purchaser shall not be required to pay any amount to
the Seller pursuant to this clause 4.5 on a date earlier than the date
which falls five days after the date on which the Purchaser shall
actually have received from the Seller the VAT invoice and other
documents referred to above together with notification in writing of
the date on which such payment falls due to be made in accordance with
the provisions of this clause 4.5.
4.6 If the Purchaser disagrees with the ruling of H.M. Customs and Excise
referred to in clause 4.5, it may, within 14 days of being notified by
the Seller of that ruling, give notice to the Seller that it requires
the Seller to obtain a review by the Commissioners of H.M. Customs and
Excise of that ruling and the Seller shall, as soon as practicable,
request the Commissioners to undertake that review.
4.7 Immediately upon the Seller being advised by the Commissioners of H.M.
Customs and Excise of their decision arising out of the review referred
to in clause 4.6, the Seller shall notify the Purchaser of that
decision and, if the Purchaser disagrees with that decision, the
Purchaser may:
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4.7.1 give notice to the Seller that it requires the Seller (subject
to clause 4.10) to appeal to the Value Added Tax Tribunal
against that decision in such manner as the Purchaser may
request; or
4.7.2 itself make all such appeals against that ruling as the
Purchaser shall consider appropriate with such assistance from
the Seller as the Purchaser shall reasonably request from time
to time and in either case, the Seller shall (subject to
clause 4.9) comply with any such request as soon as
practicable.
4.8 If the review referred to in clause 4.6 or the contest referred to in
clause 4.7 is successful the Seller will pay to the Purchaser
4.8.1 all amounts paid by the Purchaser pursuant to this clause 4.8,
and
4.8.2 any interest or other amounts received from H.M. Customs and
Excise and referable to the amount previously taken to be VAT
charged in respect of the transfer of the Business pursuant to
this agreement.
Such payment shall be made forthwith after the Seller becomes aware of
the successful result of such review or contest or, when the amount
previously taken to be VAT chargeable in respect of the transfer of the
Business pursuant to this Agreement has been accounted for to H.M.
Customs and Excise, immediately following receipt of repayment of, or
credit in respect of, such amount. The Seller agrees that it will
promptly make and prosecute all claims and take all other steps
necessary to ensure that it obtains repayment of and/or effective
credit for such purported VAT and the other amounts referred to above.
4.9 The Seller shall not be required to take any action under clause 4.7.1
or 4.7.2 unless it has been indemnified to its reasonable satisfaction
by the Purchaser against all reasonable costs and expenses the Seller
may properly incur in taking any such action.
4.10 The Seller shall (unless prior to Completion H.M. Customs and Excise
shall have ruled that the said transfer does not fall within Article 5)
deliver all records relating to the Business referred to in section 49
VATA to the Buyer at Completion and shall not make any request to H.M.
Customs and Excise for those records to be preserved by the Seller.
5. COMPLETION
5.1 Completion shall take place immediately after signature of this
agreement at the offices of Xxxxxx Xxxxx & Xxxxxxx at 0 Xxxxxxx Xxxxxx,
Xxxxxx, XX0X 0XX on the Completion Date.
5.2 At Completion, the Seller shall do or procure the carrying out of those
things listed in Schedule 1.
5.3 The Purchaser shall not be obliged to complete the purchase of any of
the Business Assets unless all of the requirements of sub-clause 5.2
and Schedule 1 have been complied with and all of the Business Assets
are included in the sale, although it is within the Purchaser's
discretion to proceed to Completion in any event or defer Completion to
a date when the Purchaser is satisfied that the obligations of the
Seller set out in sub-clause 5.2 and Schedule 1 have been satisfied.
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5.4 When the Purchaser is satisfied that the Seller has complied with its
obligations under sub-clause 5.2, the Purchaser shall:
5.4.1 pay the sum of US$ 42,500 to the Seller; and
5.4.2 discharge the HSBC Debt in full.
5.5 Immediately on receipt of the sum delivered to the Seller pursuant to
clause 5.5.1, the Seller shall subscribe for the Common Stock and pay
the sum of US$ 42,500 to JAG for such Common Stock (the "SUBSCRIPTION
SUM"). On receipt of the Subscription Sum, JAG shall issue the Common
Stock to the Seller and deliver a stock certificate evidencing
ownership of such Common Stock in the Seller's favour. The Seller shall
immediately enter into a lock-up agreement in relation to the Common
Stock in the form as set out in Schedule 5.
6. TRANSFER OF CONTRACTS
6.1 Subject to sub-clause 6.2, the Purchaser shall become entitled to the
benefits of the Seller under the Contracts and this agreement shall
constitute an assignment of the benefit of all Contracts to the
Purchaser with effect from Completion.
6.2 This agreement shall not constitute an assignment or attempted
assignment of any Contract if the assignment or attempted assignment
would constitute a breach of such Contract.
6.3 Where a Third Party Consent is required to the assignment of the
benefit of any of the Contracts to the Purchaser, the Seller shall be
responsible (both before and after Completion and at its own expense)
for obtaining, and shall use all reasonable endeavours to obtain, any
such Third Party Consent. Upon whichever is the later of Completion and
any such Third Party Consent being obtained, this agreement shall
constitute an assignment of the benefit of the Contract to which that
Third Party Consent relates.
6.4 The Seller shall be responsible (both before and after Completion and
at its own expense) for entering into and procuring that all relevant
third parties enter into a novation agreement (in a form satisfactory
to the Purchaser) in respect of each of the Contracts which cannot
legally be assigned to the Purchaser (the "UNASSIGNABLE CONTRACTS")
with the intent that, with effect from whichever is the later of
Completion and the date such novation agreement is entered into, the
Purchaser shall perform such Contract and be bound by it as if the
Purchaser were a party to that Contract in lieu of the Seller as from
the date of its novation.
6.5 The Purchaser shall not be liable for any liabilities, losses, charges,
costs, claims or demands whatsoever arising from the absence of or any
failure to obtain any Third Party Consent in accordance with this
agreement or to procure that any relevant third parties enter into
novation agreements in accordance with this agreement or from any
breach of any Contract caused by this agreement or its Completion and
the Seller shall indemnify the Purchaser against any such liabilities,
losses, charges, costs, claims or demands (including loss of sales or
diminution in the value of the Business).
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6.6 After Completion, and until any necessary Third Party Consent to the
assignment of a Contract is obtained or a novation agreement has been
entered into in respect of an unassignable Contract in accordance with
this agreement or the Purchaser makes an election pursuant to
sub-clause 6.7, the following provisions shall apply:
6.6.1 The Seller shall be treated as holding the benefit of that
Contract in trust for the Purchaser and any benefit will be
promptly paid over to the Purchaser.
6.6.2 If it is permissible under the Contract the Purchaser shall
perform on behalf of the Seller (but at the Purchaser's
expense) the obligations of the Seller under that Contract and
arising after Completion.
6.7 If any Third Party Consent to the assignment of a Contract is not
obtained or a novation agreement is not entered into in respect of an
unassignable Contract in accordance with this agreement in either case
within three months after the Completion Date (or such longer period as
the Purchaser may determine), that Contract shall, if the Purchaser
elects in writing, be treated as having been excluded from the sale
under this agreement so that the parties' obligations in respect of
that Contract shall end immediately after such election is made.
6.8 Upon any election by the Purchaser under sub-clause 6.7 above, the
Seller shall pay on demand to the Purchaser or at the Purchaser's
direction all the costs and expenses incurred by the Purchaser in
carrying out that Contract pursuant to sub-clause 6.6.2 or otherwise.
6.9 The Seller shall indemnify the Purchaser against any liabilities,
losses, charges, costs, claims or demands (including loss of sales or
diminution in the value of the Business) arising from the exclusion of
any Contract from the sale under this agreement.
7. OBLIGATIONS OF THE PURCHASER AFTER COMPLETION
7.1 Except as otherwise provided in this agreement, the Purchaser
undertakes to the Seller that, with effect from Completion, it will
properly perform, assume and pay and discharge when due, and indemnify
the Seller against, all Assumed Obligations.
7.2 In this agreement, "ASSUMED OBLIGATIONS" means the following:
7.2.1 subject to sub-clause 7.3, all obligations and liabilities of
the Seller under the Contracts; and
7.2.2 all business rents, rates and other periodic outgoings in
respect of the Business Property for any period of time after
Completion.
7.3 Except as otherwise provided in this agreement, the Purchaser
undertakes that from Completion it will perform the outstanding
obligations and liabilities under the Contracts to the extent that they
arise in respect of the carrying on of the Business by the Purchaser
provided that this undertaking shall cease to apply in relation to any
Contract in respect of which the Purchaser makes an election pursuant
to sub-clause 6.7. Notwithstanding this undertaking, nothing in this
agreement shall:
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7.3.1 require the Purchaser to perform any such obligation falling
due for performance, or which should have been performed,
before Completion or to pay for any product or service
delivered or supplied to the Seller before Completion;
7.3.2 make the Purchaser liable for any act, neglect, default or
omission in respect of any of the Contracts committed by the
Seller or occurring before Completion; or
7.3.3 impose any obligation on the Purchaser for or in respect of
any product delivered by the Seller or any service performed
by the Seller before Completion and the Seller shall indemnify
the Purchaser against any liabilities, losses, charges, costs,
claims or demands (including loss of sales or diminution in
the value of the Business) arising from any such matters.
7.4 The Seller shall continue to be responsible for and shall promptly
discharge all debts, liabilities and obligations in connection with the
Business not assumed by the Purchaser under the express terms of this
agreement (even if assumed by the Purchaser by operation of law) and
shall indemnify the Purchaser against all liabilities, losses, charges,
costs, claims or demands (including loss of sales or diminution in the
value of the Business) in respect of all such debts, liabilities and
obligations.
8. RISK
8.1 Risk in the Business Assets shall pass on Completion.
9. EMPLOYEES
9.1 The Regulations will apply to the transfer of the Business under this
agreement, so that the contracts of employment of the Employees will
have effect from the Completion Date as if originally made between the
Purchaser and the Employees.
9.2 If for any reason the contract of employment of any person who is not
an Employee is found or alleged to have effect after the date of this
agreement as if originally made with the Purchaser, the Seller, in
consultation with the Purchaser, will, within 14 days of being so
requested by the Purchaser, make to that person an offer in writing to
employ him under a new contract of employment, to take effect upon the
termination referred to in sub-clause 10.3, identical in all respects
to that person's contract of employment immediately before the date of
this agreement. However, the Purchaser must make the request no later
than 15 days after becoming aware of the finding or allegation.
9.3 Once that offer has been made (or after the expiry of 14 days after it
has been requested), the Purchaser may terminate the employment of the
person concerned and, so long as that termination is effected within
three months after the Completion Date, the Seller will indemnify the
Purchaser against the costs of that Employee's employment, the
termination of that employment and any liabilities, or costs relating
to that employee which transfer to the Purchaser under Regulation 5 of
the Regulations.
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9.4 If the contract of employment of any Employee is found or alleged not
to have effect after the date of this agreement as if originally made
with the Purchaser, other than by virtue of Regulation 5(4A) of the
Regulations, the Purchaser, in consultation with the Seller, will,
within 14 days of being so requested by the Seller, make to that
Employee an offer in writing to employ him under a new contract of
employment, to take effect upon the termination referred to in
sub-clause 9.5, on terms and conditions which (other than the identity
of the employer) will not differ from the corresponding provisions of
the Employee's contract of employment immediately before the date of
this agreement. However the Seller must make the request no later than
15 days after the Seller becomes aware of such finding or allegation.
9.5 Once that offer has been made (or after the expiry of 14 days after it
has been requested), the Seller shall terminate the employment of the
Employee concerned and, so long as that termination is effected within
three months after the Completion Date, the Purchaser shall indemnify
the Seller against the costs of that Employee's employment and its
termination.
9.6 All wages, salaries, liabilities in respect of the Pay As You Earn
System and National Insurance Contributions and other periodic
outgoings in respect of the Assumed Employees which relate to a period:
9.6.1 after the Completion Date shall be borne by the Purchaser; and
9.6.2 on or before the Completion Date shall be borne by the Seller.
9.7 The Seller shall indemnify the Purchaser against any claim in respect
of:
9.7.1 the employment of any of the Employees at any time prior to
the Completion Date by the Seller;
9.7.2 the termination of the employment prior to the Completion Date
of any person who was formerly assigned to the Business;
9.7.3 subject to sub-clause 9.8 any failure by the Seller to comply
with its obligations under Regulation 10 of the Regulations;
and
9.7.4 any breach of sub-clause 9.6.2.
9.8 The Purchaser shall indemnify the Seller against any claim in respect
of:
9.8.1 the employment of any Employee during the period after the
Completion Date including, without limitation, any changes to
terms and conditions of employment by the Purchaser;
9.8.2 any termination of the employment of any Employee by the
Purchaser after the Completion Date;
9.8.3 any failure by the Purchaser to comply with its obligations
under Regulation 10(3) of the Regulations; and
9.8.4 any breach of sub-clause 9.6.1.
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10. SELLER'S WARRANTIES
10.1 The Seller represents and warrants to the Purchaser that each of the
Warranties is accurate in all respects and not misleading at the date
of this agreement.
10.2 The Purchaser shall not be entitled to claim that any fact causes any
of the Warranties to be breached or renders any Warranty misleading if
it has been fully and fairly disclosed to the Purchaser in writing.
10.3 The Seller undertakes to disclose in writing to the Purchaser anything
which is or may constitute a breach of or be inconsistent with any of
the Warranties immediately it comes to its notice both before, at the
time of and after Completion.
10.4 The Seller acknowledges that the Purchaser is entering into this
agreement in reliance upon representations in the terms of the
Warranties, made by the Seller with the intention of inducing and
actually inducing the Purchaser to enter into this agreement.
10.5 Each of the Warranties shall be construed as being separate and
independent and (except where expressly provided to the contrary) shall
not be limited or restricted by reference to or inference from the
terms of any other Warranty or any other term of this agreement.
10.6 Subject to sub-clause 10.2 and to the limitations set out in clause 12,
the Purchaser shall be entitled to claim after Completion that any of
the Warranties has been breached or is inaccurate or misleading and,
without limitation, to claim under any indemnity or covenant even if
the Purchaser knew or could have discovered on or before Completion
that the Warranty in question had been breached or was inaccurate or
misleading.
11. PURCHASER'S REMEDIES
11.1 No liability shall attach to the Seller in respect of claims under the
Warranties if and to the extent that the limitations referred to in
clause 12 apply.
11.2 Without restricting the rights of the Purchaser or its ability to claim
damages on any basis, the Seller undertakes to indemnify the Purchaser
in respect of all liabilities, losses, charges, costs, claims or
demands (including loss of sales or diminution in the value of the
Business) incurred or made by the Purchaser as a consequence of, or
which would not have occurred or arisen either directly or indirectly
but for any Warranty being breached, inaccurate or misleading.
11.3 For the avoidance of doubt, any payment in respect of sub-clause 11.2
shall be calculated without reference to the rules of general law
relating to claims for damages for breach of warranty.
11.4 Any payment made by the Seller in respect of any claim under the
Warranties shall be treated as a repayment of and adjustment to the
consideration payable in accordance with clause 3.
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12. LIMITATIONS ON SELLER'S LIABILITY
12.1 The Purchaser shall not be entitled to damages in respect of any claim
or claims under any of the Warranties unless and until the aggregate
amount of all substantiated claims exceeds (pound)10,000 (but if this
amount is exceeded, the Seller's liability shall be for the total
amount of the claims and shall not be limited to the excess). For these
purposes, "substantiated" means a claim which is admitted by the Seller
or proved in a court of competent jurisdiction.
12.2 In any event the total aggregate liability of the Seller under or in
accordance with this agreement (whether for breach of the Warranties or
otherwise) shall not exceed the total of the consideration under this
agreement.
12.3 No claim shall be brought against the Seller in respect of any breach
of the Warranties unless the Purchaser shall have given to the Seller
written notice of the claim specifying (in reasonable detail) the
matter which gives rise to the breach or claim, its nature and the
amount claimed (detailing the Purchaser's calculation of the loss
alleged to have been suffered by it):
12.3.1 on or before the 7th anniversary of the Completion Date in
respect of claims relating to Taxation; and
12.3.2 on or before the 3rd anniversary of the Completion Date in
respect of any other matters.
12.4 If the Purchaser is entitled to claim under any policy of insurance in
respect of any matter which would give rise to a breach of the
Warranties, then no matter of this nature shall be the subject of a
claim under the Warranties unless and until the Purchaser shall have
made a claim against its insurers. Any insurance claim shall then
reduce any claims for breach of the Warranties by the amount recovered
(less all reasonable costs and expenses incurred by the Purchaser
recovering that sum from its insurers) or extinguish the claim.
12.5 Where the Purchaser is at any time entitled to recover from some other
person any sum in respect of any matter giving rise to a claim under
the Warranties the Purchaser shall take all necessary steps to enforce
recovery before making a claim against the Seller on condition that the
relevant time limit for bringing a claim against the Seller under
sub-clause 12.2 shall be calculated from the date of recovery from the
person in question instead of from the Completion Date.
12.6 In the event that the Purchaser shall recover any amount from another
person, the amount of the claim against the Seller shall then reduce by
the amount recovered (less all reasonable costs and expenses incurred
by the Purchaser recovering that sum from the other person) or
extinguish the claim.
13. USE OF NAMES AND MARKS ALREADY APPLIED, CORPORATE NAMES AND DOMAIN
NAMES
13.1 The Seller shall (at its own expense) procure that the corporate name
of the Seller or any other name of the Seller which includes the word
"TComm", any trade xxxx or business name (whether registered or
unregistered) forming part of the Business Intellectual Property or any
xxxx or name which is confusingly similar to such xxxx or name or
likely to be associated with it will be changed within 28 days after
Completion so as not to include those words, and that the Seller will
from time to time after Completion upon the request of the Purchaser
give any consent or confirmation necessary for the adoption by the
Purchaser or any person connected with it of any corporate name
incorporating those words. The Seller shall provide appropriate
documentary evidence to the Purchaser of any change of name pursuant to
this sub-clause within 30 days of the change of name occurring.
12
13.2 The Seller shall procure that any internet domain name registrations
relating to the Business (including the domain name xxx.xxxxx.xx.xx and
xxx.xxxxx.xx) are transferred into the name of the Purchaser and the
Purchaser shall take over operation of the relevant web sites with
effect from Completion. The Seller shall not register or seek to
register any internet domain names incorporating the name "TComm" or
any other name or sign comprised in the Business Intellectual Property
or any name or sign confusingly similar to such name or sign or likely
to be associated with it. The Seller shall upon Completion remove from
any web sites which it is retaining any reference to the Business and
delete any hypertext links which connect any such web sites to web
sites which relate to the Business.
14. RESTRICTIONS ON SELLER'S BUSINESS ACTIVITIES
14.1 The Seller undertakes that it will not either alone or in conjunction
with or on behalf of any other person, do any of the following things:
14.1.1 within two years after the Completion Date, establish, be
engaged or (except as the holder of shares in a listed company
which confer not more than one per cent. of the votes which
could normally be cast at a general meeting of the company) be
directly or indirectly interested in carrying on any business
in the United Kingdom which competes with the Business as it
is carried on at the Completion Date;
14.1.2 disclose to any other person or use any Business Information
which is not in the public domain;
14.1.3 within two years after Completion, directly or indirectly
solicit the custom, in relation to goods or services sold to
any person by the Seller in the course of the Business during
the two years before Completion, of that person in respect of
similar goods or services;
14.1.4 within two years after Completion, directly or indirectly
solicit or entice away from the employment of the Purchaser
any Employee; nor
14.1.5 assist any other person to do any of the foregoing things.
14.2 Each undertaking contained in this clause shall be construed as a
separate undertaking and if one or more of the undertakings is held to
be against the public interest or unlawful or in any way an
unreasonable restraint of trade, the remaining undertakings shall
continue to bind the Seller.
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15. GROSS PAYMENTS
15.1 If any amount payable to the Purchaser by the Seller:
15.1.1 in respect of or in connection with any Warranty being
breached, untrue or misleading or any indemnity or
undertaking; or
15.1.2 under any other clause of this agreement
is subject to Taxation, such additional amounts shall be paid to the
Purchaser by the Seller so as to ensure that the net amount received by
the Purchaser is equal to the amount the Purchaser should have received
had the payment not been so subject to Taxation.
16. FURTHER ASSURANCE
16.1 Each party shall at its own cost, from time to time on request, do or
procure the doing of all such acts and/or execute or procure the
execution of all such documents in a form satisfactory to the other
party which the other party may reasonably consider necessary for
giving full effect to this agreement and securing to the other party
the full benefit of the rights, powers and remedies conferred upon the
other party in this agreement.
17. ENTIRE AGREEMENT
17.1 Together the Specified Agreements constitute the whole and only
agreement between the parties relating to the sale and purchase of the
Business Assets.
18. NOTICES
18.1 Except where expressly stated otherwise, a notice under this agreement
shall only be effective if it is in writing. E-mail is permitted.
18.2 Notices under this agreement shall be sent to a party at its address or
number and for the attention of the individual set out below:
Party and title of individual Address E-mail address
----------------------------- ------- --------------
Xxxxxx X. Xxxxxxxxx of 0000 XX 00xx Xxxxxx, xxxxxxxxxxx@xxxxxxxx.xxx
TComm (UK) Limited Suite B13, Boca Raton,
Florida, USA
Xxxxxxx XxXxxx of TComm 00 Xxxxxx Xxxxxx, xxx@xxxxx.xx.xx
Xxxxxxx Xxxxxx, XX00 0XX
Xxxxxx X. Xxxxxxxxx of JAG 0000 XX 00xx Xxxxxx, xxxxxxxxxxx@xxxxxxxx.xxx
Media Holdings Inc Suite B13, Boca Raton,
Florida, USA
18.3 Any notice given under this agreement shall, in the absence of earlier
receipt, be deemed to have been duly given as follows:
18.3.1 if delivered personally, on delivery;
14
18.3.2 if sent by first class post, two clear days after the date of
posting; and
18.3.3 if sent by facsimile or e-mail, when despatched.
19. CONFIDENTIALITY
19.1 Each party shall treat as confidential all information obtained as a
result of entering into or performing this agreement which relates to:
19.1.1 the provisions of this agreement;
19.1.2 the negotiations relating to this agreement;
19.1.3 the subject matter of this agreement; or
19.1.4 the other party and the members of its respective group (as at
the date of this agreement).
19.2 Notwithstanding the other provisions of this clause, a party may
disclose confidential information:
19.2.1 if and to the extent required by law or for the purpose of any
judicial proceedings;
19.2.2 if and to the extent required by any securities exchange or
regulatory or governmental body to which any party is subject;
19.2.3 if and to the extent required to vest the full benefit of this
agreement in that party;
19.2.4 to its professional advisers, auditors and bankers;
19.2.5 if and to the extent the information has come into the public
domain through no fault of that party; or
19.2.6 if and to the extent the other party has given prior written
consent to the disclosure, such consent not to be unreasonably
withheld or delayed.
19.3 The restrictions contained in this clause shall continue to apply after
the termination of this agreement without limit in time.
20. COSTS AND EXPENSES
20.1 Except as otherwise stated in this agreement (or any agreement referred
to in this agreement), each party shall pay its own costs and expenses
in relation to the negotiations leading up to the sale of the Business
and to the preparation, execution and carrying into effect of this
agreement and all other documents referred to in it.
21. COUNTERPARTS
21.1 This agreement may be executed in any number of counterparts, and by
the parties on separate counterparts, but shall not be effective until
each party has executed at least one counterpart.
15
21.2 Each counterpart shall constitute an original of this agreement, but
all the counterparts shall together constitute but one and the same
instrument.
22. CONTRACTS (RIGHTS OF THIRD PARTIES) XXX 0000
22.1 The parties to this agreement do not intend that any term of this
agreement should be enforceable, by virtue of the Contracts (Rights of
Third Parties) Xxx 0000, by any person who is not a party to this
agreement.
23. CHOICE OF GOVERNING LAW
This agreement shall be governed by and construed in accordance with
English law.
24. JURISDICTION
The courts of England are to have jurisdiction to settle any dispute
arising out of or in connection with this agreement. Any legal
proceedings may be brought in the English courts.
EXECUTED BY:
For and on behalf of
TCOMM (UK) LIMITED /s/ Xxxxxx X. Xxxxxxxxx
-----------------------
Director
For and on behalf of
TCOMM LIMITED ------------------------
Director
For and on behalf of
JAG MEDIA HOLDINGS, INC. ------------------------
Director
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SCHEDULE 1
(COMPLETION ARRANGEMENTS)
1. MATTERS TO BE DEALT WITH BY THE SELLER
At Completion, the Seller shall:
1.1 Transfer of Business Assets capable of delivery.
Deliver to the Purchaser all the Business Assets which are capable of
transfer by delivery with the intent that legal and beneficial title to
these Business Assets shall pass by and upon delivery.
1.2 Other Matters.
Deliver to the Purchaser:
1.2.1 those Business Records transferred under clause 2;
1.2.2 the VAT records required to be delivered under clause 4;
1.2.3 a copy of the minutes of a meeting of the directors of the Seller
in a form approved by the Purchaser authorising the execution by the Seller of
this agreement and all other relevant documents referred to in this agreement
endorsed with a certificate by the secretary of the Seller that those copy
minutes are a true and accurate record of the meeting and that the authority
conferred remains valid and outstanding; and
1.2.4 a certified copy of a resolution changing the name of the Seller
"TComm" from TComm Limited to a name not including the word "TComm".
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SCHEDULE 2
(BUSINESS ASSETS)
EQUIPMENT
Desks Grey Workstation 1800 3
Desks Grey Training 4
Training Seats 6
Operator Chairs 4
Visitor Chairs 2
Mobile Desk Units 3
Filing Cabinet 1
Mobile filing cabinet 1
Wardrobe 1
Fax Table 1
Fax/Telephone 1
PC's P4 2
PC P3 Dell 1
PC's P3 1
Monitors Various 8
PC's Training Various 6
Printer 1
Scanner 1
PC Peripherals Various n/a
Stationary/Office Equipment n/a
SOFTWARE
Eye Contact
TComm Messenger
Mobile Video Messenger
TComm TV (including backend web software)
ICU (part ownership of licence under negotiation)
Live Auction Software (part ownership of licence under negotiation)
WEBSITES
XXX.XXXXX.XX
XXX.XXXXX.XX.XX
CONTRACTS (CURRENT
KIT (ICU) Phase one R&D completed, Phase two development awaiting approval, NDA
under consideration.
BALL & XXXX (Live Auction) Grant Stage, waiting for approval for (pound)15,000
feasibility study grant.
1
TCOMM TV
2
SCHEDULE 3
(WARRANTIES)
1. CAPACITY OF THE SELLER
1.1 The Seller is a company duly incorporated and validly existing
under the laws of England and Wales.
1.2 The Seller has the requisite capacity, power and authority to enter
into and perform this agreement and any Specified Agreements.
1.3 This agreement constitutes and the other Specified Agreements
executed by the Seller which are to be delivered at Completion will, when
executed, constitute valid and binding obligations of the Seller in accordance
with their respective terms.
1.4 The execution and delivery of this agreement and those of the
Specified Agreements to which the Seller is a party, and the performance by the
Seller of its obligations under it them, will not:
1.4.1 result in a breach of, or constitute a default under, any
instrument by which it is bound; or
1.4.2 result in a breach of any order, judgment or decree of any
court, governmental agency or regulatory body by which it is bound; or
1.4.3 require the consent of its shareholders or of any other
person.
2. INSOLVENCY
2.1 No order has been made, no petition has been presented, no meeting
has been convened to consider a resolution and no resolution has been passed for
the winding up of the Seller.
2.2 No administration order has been made and no petition for such an
order has been presented in respect of the Seller.
2.3 No voluntary arrangement has been proposed under section 1 of the
Insolvency Xxx 0000 in respect of the Seller.
2.4 No receiver (which expression shall include an administrative
receiver) has been appointed in respect of any of the Business Assets.
3. OWNERSHIP OF BUSINESS ASSETS
3.1 Each of the Business Assets is owned both legally and beneficially
by the Seller and each of the Business Assets capable of possession is in the
possession of the Seller and situated in the United Kingdom.
1
3.2 No option, right to acquire, mortgage, charge, pledge, lien (other
than a lien arising by operation of law in the ordinary course of business) or
other right exercisable by third parties or other form of security or
encumbrance or equity on, over or affecting the whole or any part of the
Business Assets is outstanding and there is no agreement or commitment to give
or create any and no claim has been made by any person to be entitled to any.
3.3 All consents, approvals, authorisations and waivers of third
parties which are required for the transfer of the Business Assets to the
Purchaser including, without limitation, Third Party Consents have been obtained
in writing.
4. OPERATION OF THE BUSINESS
4.1 The Business Assets comprise all the assets now used in the
Business and all the assets which are necessary or desirable for the
continuation of the Business as it is now carried on.
5. BUSINESS PLANT AND MACHINERY
5.1 All Business Plant and Machinery is in good repair and condition,
regularly maintained and fully serviceable and capable of being efficiently and
properly used in connection with the Business and none is dangerous,
inefficient, obsolete or in need of renewal or replacement.
6. CONTRACTS AND COMMITMENTS
6.1 Full, complete and accurate details of each Contract have been
supplied to the Purchaser including, without limitation, the full terms of each
oral Contract and details of all prepayments in respect of the Contracts.
6.2 All those Contracts which are material to the Business are listed
in Schedule 2 (Business Assets).
6.3 No Contract is an agency, distributorship, franchise, purchaser,
licensing, management or joint venture agreement or arrangement affecting the
Business.
6.4 No Contract falls within any of the cases specified below:
6.4.1 the Contract is of a value which has material consequences in
terms of expenditure or revenue expectations;
6.4.2 the Contract relates to matters not within the ordinary and
usual course of business; or
6.4.3 the Contract is of three years or greater duration, or if it
is of less than three years' duration, it is of a length which significantly
exceeds what is normal in the circumstances.
6.5 The Seller is under no obligation in relation to the Business, and
is not a party to any Contract, which cannot readily be fulfilled or performed
by it on time and without undue or unusual expenditure of money or effort.
2
6.6 No Contract restricts the Seller's freedom to carry on the whole or
any part of the Business or to use or exploit any of the Business Assets in any
part of the world in such manner as it thinks fit.
6.7 The Seller is not in material breach of any of the Contracts nor,
so far as the Seller is aware, is any other party to any Contract.
7. TRADING
7.1 No customer (except for Ifilm) or supplier of the Business has
during the 12 months preceding the date of this agreement:
7.1.1 ceased or indicated an intention to cease trading with or
supplying to the Business;
7.1.2 reduced, or indicated an intention to reduce or is likely to
reduce substantially its trading with or supplies to the Business; or
7.1.3 changed, or indicated an intention to change substantially
the terms on which it is prepared to trade with or supply the Business (other
than normal price and quota changes).
8. INTELLECTUAL PROPERTY
8.1 The Business Intellectual Property is valid, subsisting and
enforceable.
8.2 So far as the Seller is aware, no third party is infringing or
making unauthorised use, or has infringed or made unauthorised use, of any
Business Intellectual Property or Business Information.
8.3 The processes and methods employed, the services provided, the
businesses conducted and the products manufactured, used or dealt in by the
Seller in connection with the Business do not, and at the time of being
employed, provided, conducted, manufactured, used or dealt in did not, infringe
or make unauthorised use of the Intellectual Property rights or information,
know-how or techniques of any third party.
8.4 None of the Business Intellectual Property or Business Information
is the subject of any litigation, opposition or administrative proceedings.
8.5 The Seller has not assigned any Business Intellectual Property to
any third party in the two years prior to the date of this agreement and, so far
as the Seller is aware, the Seller is not restricted from using any of the
Business Intellectual Property anywhere in the world.
8.6 No third party has registered or uses any domain name which is
identical or similar to any trade xxxx (whether registered or unregistered and
including applications for registration) or name used in the Business.
8.7 The Seller does not use the Business Intellectual Property other
than in relation to the Business and no express or implied licence or
arrangement granted or entered into before Completion in relation to such rights
shall continue after such date.
3
9. EMPLOYEES
9.1 The Employees will be all of the employees necessary for the proper
and efficient operation of the Business at Completion.
9.2 The list of Employees in Schedule 4 is an accurate list of all the
Employees as at the date hereof and there is no omission which makes it
misleading.
9.3 For every Employee set out in Schedule 4 there are:
9.3.1 full details of the terms of employment (including the
emoluments);
9.3.2 the years of continuous service for redundancy purposes of
that Employee;
9.3.3 full details of any benefit received by any Employee
otherwise than in cash; and
9.3.4 full details of any benefit received by any Employee in cash
which is related to sales, profits, turnover or performance, or which is
otherwise variable (other than normal overtime).
9.4 Since the Business Accounts Date, no change has been made in the
emoluments or other terms of engagement of any Employee, and no such change, and
no negotiation or request for such a change, is due or expected within six
months from the date of this agreement.
9.5 The contract of employment of each Employee may be terminated by
the employer without damages or compensation (other than that payable by
statute) by giving at any time the minimum period of notice applicable to that
contract which is specified in the Employment Rights Xxx 0000.
9.6 No Employee has given or is expected to give notice terminating his
contract of employment nor is under notice of dismissal nor has made or
threatened (or is expected to do so) any litigation, arbitration or mediation,
administration or criminal proceeding in connection with or arising from his
employment and there is no obligation or amount due to or in respect of any
Employee in connection with or arising from his employment which is in arrear or
unsatisfied other than his normal salary for part of the month current at the
date of this agreement.
9.7 No trade union, works council, staff association or other body
representing employees is recognised in any way for bargaining, information or
consultation purposes in relation to the Current Employees.
9.8 There are no agreements (whether legally binding or not) with any
such representative body in relation to the Current Employees and there is no
dispute with any such representative body pending, threatened or expected in
relation to the Business.
9.9 There is no outstanding undischarged liability to pay to any
governmental or regulatory authority in any jurisdiction any contribution,
Taxation or other impost arising in connection with the employment or engagement
of personnel in the Business.
4
9.10 There are no claims threatened or in relation to the Business by
or in respect of any Current Employee in respect of any accident or injury or in
relation to any other matter arising from his employment.
10. BUSINESS ACCOUNTS
10.1 The Business Accounts:
10.1.1 were prepared in accordance with applicable law and
accounting principles and practices generally accepted in the United Kingdom at
the time they were audited and commonly adopted by companies carrying on
businesses similar to the Business;
10.1.2 were prepared on a basis consistent with previous years;
10.1.3 are complete and accurate in all material respects and, in
particular and without limitation, the Business Accounts include adequate
provision for bad and doubtful debts;
10.1.4 show a true and fair view of the state of affairs of the
Business at the Business Accounts Date and of the results of the Business for
the accounting period ended on the Business Accounts Date; and
10.1.5 except as the Business Accounts expressly disclose, are not
affected by any unusual or non-recurring items.
11. EVENTS SINCE THE BUSINESS ACCOUNTS DATE
11.1 Since the Business Accounts Date:
11.1.1 there has been no material adverse change in the financial
or trading position or prospects of the Business nor is any such change
expected;
11.1.2 the Business has been carried on in the ordinary and usual
course;
11.1.3 no materially unusual, abnormal or onerous contract,
agreement, arrangement or commitment has been entered into; and
11.1.4 no mortgage, charge (other than a lien arising by operation
of law), debenture or other security over any of the Business Assets has been
created, granted or issued or agreed to be credited, granted or issued.
12. LITIGATION
12.1 The Seller is not in respect of the Business involved in any
litigation, arbitration or other dispute resolution process, or administrative
or criminal proceedings, or regulatory agency action whether as claimant,
defendant or otherwise, and no litigation, arbitration or other dispute
resolution process, administrative or criminal proceedings by or against the
Seller in respect of the Business is pending, threatened or expected and is
aware, there is no fact or circumstance likely to give rise to any such
litigation, arbitration or other dispute resolution process, administrative or
criminal proceedings or regulatory agency action.
5
13. CONSENTS AND LICENCES
13.1 All licences, consents, permissions and approvals required for or
in connection with the carrying on of the Business in the manner currently
carried on:
13.1.1 have been obtained in writing;
13.1.2 are not limited in duration or subject to unusual or onerous
conditions; and
13.1.3 are in full force and effect.
14. TAX RETURNS, DISPUTES, RECORDS AND CLAIMS ETC.
14.1 In respect of the Business, the Seller has made all proper returns
required to be made, and has supplied or caused to be supplied all information
required to be supplied, to any revenue authority, including (but without
limitation) the Inland Revenue and H.M. Customs & Excise.
14.2 There is no dispute or disagreement outstanding nor is any
contemplated at the date of this agreement with any revenue authority regarding
the proper method of computing the profits of the Business (or any part of it)
for Tax purposes or the proper treatment for VAT purposes of any supplies of
goods or services made (or treated as made) in the course of the Business and
there are no circumstances which make it likely that any such dispute or
disagreement will commence.
14.3 The amount of Tax chargeable on the Seller in respect of the
Business during any accounting period ending on or within six years before the
Business Accounts Date has not, to any material extent, depended on any
concession, agreement or other formal or informal arrangement with any revenue
authority, including (but without limitation) the Inland Revenue and H.M.
Customs & Excise.
15. DUTIES ETC.
All customs duties and VAT payable to any revenue authority (including,
but without limitation, H.M. Customs & Excise) upon the importation of
any of the Business Assets and all excise duties payable to any revenue
authority (including, but without limitation, H.M. Customs & Excise) in
respect of any of the Business Assets have been paid in full, and none
of the Business Assets is liable to confiscation or forfeiture (whether
by virtue of non-payment or underpayment of any Tax or duty or by
virtue of non-compliance with any legislation or regulation relating to
any Tax or duty or otherwise howsoever).
16. OPTION TO ELECT TO TAX
No election (or application to elect) has been nor will before
Completion be made under paragraph 2 of Schedule 10 to the VATA 1994 in
relation to the Business Property or any part of any of it.
17. INHERITANCE TAX
17.1 No circumstances exist whereby any power conferred by section 212
Inheritance Tax Act 1984 could be exercised in relation to any of the Business
Assets.
6
17.2 There is no outstanding Inland Revenue charge within the meaning
of section 237 inheritance Tax Xxx 0000 over any of the Business Assets.
18. VAT
18.1 None of the Business Assets is a chargeable asset (as defined by
section 44 VATA 1994) which, if transferred to the Purchaser, would give rise to
a liability on the Purchaser or the purposes of section 44 VATA 1994.
18.2 All VAT payable in respect of goods and services supplied or
deemed to be supplied by the Seller before Completion and all interest payable
thereon and penalties attributable thereto has been paid to H.M. Customs &
Excise.
19. ACCURACY AND ADEQUACY OF INFORMATION
The information given in this agreement and all information contained
in any written document or communication which has been given by the
Seller or its directors, auditors, financial advisers, solicitors or
officials to the Purchaser or to the solicitors, accountants or agents
of the Purchaser in the course of negotiations leading to this
agreement is, so far as the Seller is aware, true and accurate and not
misleading and there is no omission from the information which makes it
misleading.
7
SCHEDULE 4
(EMPLOYEES)
---------------------------------------------------------------------------------------------------------------------
NAME TERMS OF EMPLOYMENT, INCLUDING SALARY YEARS OF BENEFITS DETAILS OF
CONTINUOUS OTHER THAN BONUSES,
SERVICE CASH COMMISSIONS ETC
---------------------------------------------------------------------------------------------------------------------
Xxxxxxx XxXxxx 3 years; (pound)24,000 pa for first 12 months 1 None None
and then (pound)36,000 pa thereafter
---------------------------------------------------------------------------------------------------------------------
Xxx Xxxxxxxxxx 3 years; (pound)12,500 pa for first 6 months and 1 None None
then (pound)15,000 pa thereafter
---------------------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxxxxxx 3 years; (pound)12,500 pa for first 6 months and 1 None None
then (pound)15,000 pa thereafter
---------------------------------------------------------------------------------------------------------------------
Xxxxxx XxXxxx 3 years; (pound)12,500 pa for first 6 months and 1 None None
then (pound)14,400 pa thereafter
---------------------------------------------------------------------------------------------------------------------
1
SCHEDULE 5
(LOCK UP AGREEMENT)
To: JAG Media Holdings, Inc.
Attention: Xxxxxx X. Xxxxxxxxx
0000 XX 00xx Xxxxxx, Xxxxx X00
Xxxx Xxxxx, XX 00000
Undertaking Concerning the Prohibition on Disposal
The undersigned, Video Codec Consultants Limited (formerly TComm Limited), a
company incorporated under the laws of England and Wales with registered number
4840591 is a stockholder of JAG Media Holdings, Inc., a Nevada corporation
("JAG") and holds 250,000 shares of common stock, par value US$ 0.00001 (the
"SECURITIES").
The undersigned hereby undertakes toward JAG irrevocably and subject to the
applicable provisions of Nevada law, that within a period of twelve months from
the date hereof, the undersigned will not offer or sell or otherwise dispose of
any of its Securities directly or indirectly, neither on an exchange nor in an
off-exchange transaction, or announce such action, or take any other action that
is economically equivalent to a sale unless the undersigned is voluntarily wound
up or stuck off in which case it may transfer the Securities to Xxxxxxx XxXxxx,
provided that he enters into a lock up agreement on substantially similar terms
for the remainder of the 12 month restricted period.
The undersigned agrees that JAG may furnish any regulatory body or recognised
stock exchange with information about the Securities held by the undersigned and
that it may provide a copy of this written undertaking to any such body or
exchange.
In the event of a breach of the prohibition on disposal, the undersigned waives
any claim against JAG concerning the execution of the transaction and delivery.
The undersigned is aware that delivery may be denied in the event of a breach of
the prohibition on disposal and that the undersigned may thus become liable for
damages toward the purchaser.
The undersigned expressly states that the undersigned agrees with the provisions
contained herein.
This undertaking is governed by and shall be construed in accordance with the
laws of the State of Nevada.
--------------------------------- ---------------------------
(place, date) (signature)
1
Dated: , 2004
-----------------------------
Print name of stockholder: Video Codec Consultants Limited (formerly
TComm Limited)
Signature of the duly authorised representative of Video Codec Consultants
Limited (formerly TComm Limited):
By:
---------------------------------------
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