SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): October 6, 1999
VOICENET, INC.
(Exact name of registrant as specified in its charter)
Delaware 333-12979 13-3896031
(State of incorporation) (Commission File Number) (IRS Employer
Identification No.)
1040 First Avenue
Suite 101
New York, New York 10022
(Address of principal executive offices)
(212)572-4861
(Issuer's telephone number)
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ITEM 5. OTHER EVENTS.
On October 6, 1999, Voicenet, Inc. (the "Company") completed the placement
of 100,000 shares of Series A Convertible Preferred Stock, stated value $30 per
share (the "Series A Preferred Stock"), of the Company for $3.0 million in cash.
The securities were issued in a private placement pursuant to Regulation D of
the Securities Act of 1933, as amended. The Series A Preferred Stock was
purchased by Voicenet (Aust.), Ltd., which was the majority shareholder of the
Company prior to the offering.
The holders of the Series A Preferred Stock are not entitled to receive
dividends. The shares of Series A Preferred Stock are convertible into shares of
the Company's Common Stock. Each share of Series A Preferred Stock is
convertible into the number of shares of Common Stock equal to the quotient of
(i) $30.00 divided by (ii) the Conversion Price. The Conversion Price will be
equal to 90% of the average closing "bid" price of the Company's publicly traded
common stock for the thirty (30) consecutive trading days immediately preceding
the date of conversion (the "Conversion Date") as reported by Bloomberg
Financial L.P.
Copies of the form of Preferred Stock Subscription Agreement and the
Certificate of Designations of the Series A Preferred Stock are filed as
exhibits to this Current Report on Form 8-K.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
The following are filed as exhibits to this Current Report on Form 8-K:
99.1 Press Release dated October 20, 1999.
99.2 Certificate of Designations of Series A Convertible Preferred Stock.
99.3 Form of Preferred Stock Subscription Agreement dated as of September 10,
1999 between Voicenet, Inc. and investors.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
VOICENET, INC.
By: /s/ Howard J. Messer
--------------------------------
Name: Howard J. Messer
Title: Chief Financial Officer
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EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
99.1 Press Release dated October 20, 1999.
99.2 Certificate of Designations of Series A Convertible Preferred
Stock.
99.3 Form of Preferred Stock Subscription Agreement dated as of
September 10, 1999 between Voicenet, Inc. and investors.
FOR IMMEDIATE RELEASE
OCTOBER 20, 1999
CONTACTS:
Howard J. Messer,CFO
(973)809-9445
VOICENET, INC. ANNOUNCES PREFERRED STOCK FINANCING
NEW YORK, NEW YORK - OCTOBER 20, 1999 -- Voicenet, Inc. (Nasd OTCBB:VNET), today
announced the completion of a convertible preferred stock financing to
strengthen the Company's balance sheet.
"The new financing has successfully positioned Voicenet, Inc. to direct all its
fiscal 2000 energies on growing revenue behind its new strategy," said Frank
Carr, CEO of Voicenet. "With a strengthened balance sheet, and exciting products
in the pipeline, the management team is ready to mount a focused attack on the
fast-expanding market for speech recognition technologies."
The financing involved the private placement, under Regulation D of the
Securities Act of 1933, of approximately $3.0 million in zero-dividend Series A
convertible preferred stock to an investor group lead by Voicenet (Aust.), Ltd.,
which already was the majority shareholder of the Company.
The Series A Preferred Stock is convertible into common stock at the conversion
rate equal to 90% of the average closing "bid" price of the Company's publicly
traded common stock for the thirty (30) consecutive trading days immediately
preceding the date of conversion as reported by Bloomberg Financial L.P.
ABOUT VOICENET
Voicenet is a technology company involved in the development of advanced speech
recognition solutions specifically addressing technology applications in the
telecommunications arena and is committed to the delivery of leading edge
software applications by applying its SPEECHware( technology as a powerful,
enabling force.
# # #
This press release contains forward-looking statements which are made pursuant
to the safe-harbor provisions of the Private Securities Litigation Reform Act of
1995. Expressions of future goals and similar expressions including without
limitation such words as "expects","believes", "hopes", "anticipates",
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"expected", "does not currently expect" and "forecast", reflecting something
other than historical fact are intended to identify forward-looking statements,
but are not the exclusive means of identifying such statements. These
forward-looking statements involve a number of risks and uncertainties,
including the timely development and market acceptance of products and
technologies, and other factors described in the Company's filings with the
Securities and Exchange Commission. The actual results may differ materially
from any forward-looking statements due to such risks and uncertainties. The
Company undertakes no obligations to revise or update any forward-looking
statements in order to reflect events or circumstances that may arise after the
date of this release.
CERTIFICATE OF DESIGNATION
OF
SERIES A CONVERTIBLE PREFERRED STOCK
OF
VOICENET, INC.
The undersigned, Frank Carr and Howard J. Messer, do hereby certify:
1. That they are the duly elected and acting Chief Executive Officer and
Secretary, respectively, of Voicenet, Inc., a Delaware corporation (together
with its successors the "Corporation").
2. That pursuant to the authority conferred upon the Board of Directors by
the Restated Certificate of Incorporation of the Corporation, the Board of
Directors has adopted the following resolution creating the powers,
designations, preferences and other rights of a newly authorized series of
100,000 shares of Preferred Stock designated as Series A Convertible Preferred
Stock as required by Section 151 of the Delaware General Corporation Law:
RESOLVED, that pursuant to the authority granted to and vested in the Board
of Directors of the Corporation (the "Board of Directors") in accordance with
the provisions of the Corporation's Restated Certificate of Incorporation (the
"Certificate of Incorporation"), the Board of Directors hereby creates a new
series of Series A Convertible Preferred Stock, par value $.01 per share, of the
Corporation and hereby states the designation and number of shares, and fixes
the relative rights, preferences and limitations thereof, as follows:
Series A Convertible Preferred Stock:
SECTION 1. DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series A Convertible Preferred Stock" ("Series A Preferred
Stock") and the number of shares constituting Series A Preferred Stock shall be
100,000. Such number of shares may be increased or decreased by resolution of
the Board of Directors, provided that no decrease shall reduce the number of
shares of Series A Preferred Stock to a number less than the number of shares
then outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the conversion of
any outstanding securities issued by the Corporation convertible into Series A
Preferred Stock.
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SECTION 2. VOTING RIGHTS.
A. The holders of shares of Series A Preferred Stock shall be entitled
to vote on all matters that may properly come before the common shareholders of
the Corporation. The number of shares that the holders of the Series A Preferred
Stock shall be entitled to vote shall equal that number of shares of Common
Stock into which the Series A Preferred Stock are convertible assuming that the
conversion took place on the record date established for voting at the
shareholders' meeting.
SECTION 3. CONVERSION.
A. Subject to Section 3(B) and Section 3(C), a holder of shares of
Series A Preferred Stock may, at any time after the date of issuance of such
shares by delivering to the Corporation written notice ("Conversion Notice"),
convert one or more shares of Series A Preferred Stock into the number of shares
of the Corporation's common stock (the "Common Stock") equal to (i) $30.00
divided by (ii) the Conversion Price (as defined in Section 3(C)). The
Conversion Notice shall specify the number of shares of Series A Preferred Stock
to be converted, the applicable Conversion Price, the number of shares of Common
Stock issuable on conversion (which shall not be less than 1,000 shares of
Series A Preferred Stock, except if all shares of Series A Preferred Stock then
outstanding are being converted to Common Stock). From and after the date on
which the Corporation received a Conversion Notice from a holder of a share of
Series A Preferred Stock (or if such date is not a business day in the State of
New York, the next succeeding business day) (the "Conversion Date"), such share
shall cease to be outstanding and the converting holder shall be deemed the
owner of the number of shares of Common Stock into which such share of Series A
Preferred Stock was converted. The Corporation shall deliver to such holder an
uncertificated security evidencing such shares of Common Stock through
book-entry transfer within three business days following the Conversion Date or,
at the written request of the holder as specified in the Conversion Notice, a
physical stock certificate evidencing such shares within ten business days
following the Conversion Date (such date of delivery referred to as the "Issue
Date"). For purposes of the preceding sentence, the first business day following
the Conversion Date shall count as the first business day for delivery of
evidence of such shares of Common Stock.
B. On the Issue Date, the Corporation shall issue and cause to be
delivered (against delivery of the certificate representing the Series A
Preferred Stock (the "Preferred Certificate")) to the registered holder thereof
at such address as such holder shall specify in the Conversion Notice a
certificate or certificates (including uncertificated securities) for the number
of full shares of Common Stock issuable upon the conversion, registered in such
holder's name, together with cash (if any) as provided in Section 5. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such shares as of
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such Conversion Date. If on such Issue Date the number of shares of Series A
Preferred Stock to be delivered shall be less than the total number of shares
represented by the Preferred Certificate, there shall be issued to the holder
thereof or his assignee on such Issue Date a new Preferred Certificate
evidencing the remaining Series A Preferred Stock.
C. "Conversion Price" means ninety percent (90%) of the average
closing "bid" price of the Corporation's publicly-traded Common Stock for the
thirty (30) trading days immediately preceding the Conversion Date.
SECTION 4. FRACTIONAL SHARES. Fractional shares of Common Stock shall not
be issued upon conversion of shares of Series A Preferred Stock. In lieu of
issuance of a fractional share, the Corporation shall pay to the holder of the
share of Series A Preferred Stock being converted a cash amount equal to such
fraction multiplied by the Conversion Price.
SECTION 5. RESERVATION OF STOCK ISSUABLE UPON CONVERSION. The Corporation
shall at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
the shares of the Series A Preferred Stock, such number of its shares of Common
Stock as shall from time to time be sufficient to effect the conversion of all
outstanding shares of the Series A Preferred Stock.
SECTION 6. LIQUIDATION, DISSOLUTION OR WINDING UP. In the event of any
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary, before any payment or distribution of the assets of the Corporation
(whether capital or surplus) shall be made to or set apart for the holders of
Common Stock or any other series or class or classes of stock of the Corporation
ranking junior to the Series A Preferred Stock upon liquidation, dissolution or
winding up, the holders of the shares of Series A Preferred Stock shall be
entitled to receive an amount equal to the greater of (i) $30.00 per share , or
(ii) the amount payable assuming conversion of the Series A Preferred Stock
immediately prior to such liquidation, dissolution of winding up (the
"Liquidation Preference"). If, upon any liquidation, dissolution or winding up
of the Corporation, the assets of the Corporation, or proceeds thereof,
distributable among the holders of the shares of Series A Preferred Stock shall
be insufficient to pay in full the preferential amount aforesaid and liquidating
payments on any other shares of stock ranking, as to liquidation, dissolution or
winding up, on a parity with the Series A Preferred Stock, if any, then such
assets, or the proceeds thereof, shall be distributed among the holders of
shares of Series A Preferred Stock and any such other stock ratably in
accordance with the respective amounts which would be payable on such shares of
Series A Preferred Stock and any such other stock if all amounts payable thereon
were paid in full.
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<PAGE>
SECTION 7. CONSOLIDATION, MERGER, ETC. In the event that the Corporation
shall be a party to any transaction providing for (i) any acquisition of the
Corporation by means of merger or other form of corporate reorganization in
which outstanding shares of the Corporation are exchanged for securities or
other consideration issued, or caused to be issued, by the acquiring corporation
or its subsidiary or (ii) a sale of all or substantially all of the assets of
the Corporation or (iii) any other transaction or series of related transactions
by the Corporation in which in excess of 50% of the Corporation's voting power
is transferred to a single entity or group acting in concert, the holders of the
shares of Series A Preferred Stock shall be entitled to (i) receive the
Liquidation Preference as set forth in Section 6 above or (ii) have each share
of Series A Preferred Stock which is not converted by the holder into the right
to receive Common Stock of the Corporation prior to such Transaction become
exchangeable at the election of the holder of the Series A Preferred Stock for
an equal number of shares of preferred stock of the Surviving Entity (the
"Similar Stock"), which preferred stock shall have terms substantially identical
to the terms provided in this Certificate of Designation, including without
limitation, rights specified in Sections 2 and 3 hereof and be convertible, at
the holder's option, into shares of any class of publicly traded common stock of
the Surviving Entity. For purposes hereof, "Surviving Entity" shall mean an
acquirer, purchaser or transferee contemplated by clauses (i), (ii) and (iii),
respectively, of the immediately preceding sentence. The Corporation shall not
be a party to any Transaction unless the terms of such Transaction are
consistent with the provisions of this Section 7 and it shall not consent or
agree to the occurrence of any Transaction until the Corporation has entered
into an agreement with the successor or purchasing entity, as the case may be,
for the benefit of the holders of the Series A Preferred Stock which will
contain provisions ensuring the benefits contemplated by this Section 7 to the
holders of the Series A Preferred Stock which remains outstanding after such
Transaction. The provisions of this Section 7 shall apply similarly to
successive Transactions.
SECTION 8. STOCK DIVIDENDS, STOCK SPLITS, ETC. In case the Corporation
shall after the date of first issuance of shares of Series A Preferred Stock (A)
pay a dividend or make a distribution on its Common Stock in shares of its
Common Stock, (B) subdivide its outstanding Common Stock into a greater number
of shares, or (C) combine its outstanding Common Stock into a smaller number of
shares, then the Conversion Price shall be proportionately adjusted to reflect
such event in calculating the Conversion Price. If the event in question causes
an increase in the total number of outstanding Common Stock, then the Conversion
Price will be proportionately decreased. If the event in question causes a
decrease in the total number of outstanding Common Stock, then the Conversion
Price will be proportionately increased. In case the Corporation shall after the
date of the first issuance of the Series A Preferred Stock issue any shares of
capital stock by reclassification of its Common Stock (excluding any transaction
as to which Section 7 applies), each share of Series A Preferred Stock shall
thereafter be convertible into the kind and in the proportion of shares of stock
and other
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securities and property ("Reclassification Consideration") receivable by a
holder of one share of Common Stock immediately prior to the record date or
effective date of such reclassification, as appropriate, and the Conversion
Price in such circumstances shall be determined based upon weighted prices of
the Reclassification Consideration. In the event the market price of any portion
of the Reclassification Consideration cannot be determined in a manner
reasonably consistent with Section 3(C), the market value of such portion of the
Reclassification Consideration shall be determined in good faith by the
Corporation's Board of Directors. In addition, the Conversion Price following
such a reclassification shall be adjusted as appropriate in a manner consistent
with the first three sentences of this Section 8. Adjustments made pursuant to
this Section 8 shall become effective immediately after the close of business on
the record date in the case of a dividend or distribution and shall become
effective immediately after the close of business on the record date in the case
of subdivision, combination or reclassification.
SECTION 9. AMENDMENT. So long as any shares of Series A Preferred Stock are
outstanding, the Corporation shall not, without first obtaining the approval by
vote or written consent, in the manner provided by law, of the holders of at
least a 66-2/3rd percent majority of the total number of shares of Series A
Preferred Stock outstanding, voting separately as a series, amend or repeal any
provision of, or add any provision to, the Corporation's Certificate of
Incorporation if such action would adversely affect the preferences, rights,
privileges or powers of, or the restrictions provided for the benefit of, the
Series A Preferred Stock.
SECTION 10. RANK.
A. With respect to liquidation preferences, the Series A Preferred
Stock shall rank senior to all other existing capital stock of the Corporation
and shall rank senior to all series of any class of the Corporation's capital
stock issued after the date of the filing of this Certificate of Designation.
B. So long as any shares of the Series A Preferred Stock are
outstanding, no Common Stock nor any other such stock of the Corporation ranking
junior to the Series A Preferred Stock will be redeemed, purchased or otherwise
acquired for any consideration by the Corporation (except by conversion into or
exchange for stock of the Corporation ranking junior to the Series A Preferred
Stock and except pursuant to restricted employee benefit plans) unless, in each
case the Corporation offers to redeem all outstanding shares of the Series A
Preferred Stock on substantially the same terms (provided that the redemption
price per share shall not be less than the Liquidation Preference).
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IN WITNESS WHEREOF, this Certificate of Designation is executed on behalf
of the Corporation by the Chief Executive Officer and attested by its Secretary
as of the 8th day of October, 1999.
--------------------------
Frank Carr
Chief Executive Officer
Attest:
/s/ Howard J. Messer
- -------------------------------
Howard J. Messer
Secretary
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VOICENET, INC.
100,000 Shares of Series A Convertible Preferred Stock
ACCREDITED INVESTOR SUBSCRIPTION AGREEMENT
To: VOICENET, INC.
1040 First Avenue
New York, NY 10023
Dear Gentlemen:
The undersigned purchaser (the "Purchaser") hereby confirms its agreement with
Voicenet, Inc., a Delaware corporation (the "Company"), as follows:
1. Issuance of Securities. The Company proposes to issue and sell up to 100,000
Series A Convertible Preferred Stock (the "Shares") at a price of $30 per Share,
representing $3,000,000 in principal amount of its Shares. Commencing
immediately, the Shares sold hereunder shall be convertible at the option of the
Purchaser of the Shares into the Company's Common Stock, par value $.001 per
share (the "Common Stock"), at a price per share of Common Stock equal to ninety
percent (90%) of the average closing "bid" price of the Company's publicly
traded Common Stock for the thirty (30) trading days prior to the conversion
date as reported by Bloomberg Financial L.P. All 100,000 Shares are convertible
into shares of Common Stock. The terms, rights and preferences for the Shares
shall be substantially as set forth on the Certificate attached as exhibit A
hereto and made a part hereof.
The Shares will be offered and sold to you pursuant to an exemption from
registration provided by Regulation D ("Regulation D") and Rule 144A ("Rule
144A") promulgated under the Securities Act of 1933, as amended (the "Act"). The
Company has provided you with a copy of the Form 10-KSB of the Company for the
year ended December 31, 1997 and 1998 and its Form 10-QSB of the Company for the
period ended June 30, 1999 as filed with the Securities and Exchange Commission
(collectively, the "Disclosure Documents"), relating to the Company, the Common
Stock and the Shares.
Upon original issuance thereof, and until such time as the same is no longer
required under the applicable requirements of the Act, the Shares (and all
securities issued in exchange therefor, in substitution thereof or upon
conversion thereof, including the Common Stock) shall bear the following legend:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.
THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE
OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED."
2. Agreement to Sell and Purchase Shares. On the basis of the representations
and warranties contained in this Accredited Investor Stock Purchase Agreement
(this "Agreement"), and subject to its terms and conditions and further subject
to acceptance of this Agreement by the Company, the Company agrees to issue and
sell the Shares to the Purchaser and the Purchaser agrees, to purchase from the
Company the amount of Shares set forth on the signature page hereof which is
$3,000,000 in principal amount of Shares in the aggregate.
<PAGE>
3. Delivery and Payment. Payment for the Shares shall be made in cash upon
subscription. Upon acceptance of the subscription by the Company, the Company
shall deliver the Shares to Purchaser. There is no minimum offering amount, and
accordingly subscription funds shall be immediately available for disbursement
to and use by the Company.
4. Representations and Warranties of the Purchaser. The Purchaser hereby
represents and warrants to the Company as follows:
(a) The Purchaser has received a copy of the Disclosure Documents and the
Purchaser has carefully reviewed the Disclosure Documents and this Agreement.
The Purchaser has had full opportunity to ask questions of the Company, or one
of its representatives regarding the Company. All documents and information
reasonably requested by the Purchaser from the Company or its representatives
have been provided to Purchaser?s satisfaction.
(b) The Purchaser has the full right, power and authority to enter into this
Agreement and to carry out and consummate the transactions contemplated herein.
This Agreement constitutes the legal, valid and binding obligation of the
Purchaser enforceable in accordance with its terms.
(c) The Purchaser is acquiring the Shares for his own account and risk and not
as part of any plan or scheme to evade the registration requirements of the Act,
and no other person has any interest in or participation in the Shares or any
right, option, security interest, pledge or other interest in or to the Shares.
The Purchaser understands and agrees that he must bear the economic risk of its
investment in the Shares for an restricted period of time as set forth in the
Agreement.
(d) The Purchaser understands that the offer and sale of the Shares is being
made only by means of this Agreement. In deciding to subscribe for Shares, the
Purchaser has not considered any information other than that contained in the
Disclosure Documents and this Agreement and any documents provided to the
Purchaser by the Company upon request. The Purchaser acknowledges that each of
such documents contain on the cover thereof a legend as to the absence of
registration of the Shares under the Act and the restrictions arising under the
Act. The Purchaser is aware that the purchase of the Shares involves a high
degree of risk, the Company has a limited operating history, the Company has had
no operating income, the Company is in the development stage and has not
commercialized any products, the Company has an significant accumulated deficit,
the Company has incurred losses since inception and will likely incur losses for
the near foreseeable future and that the Purchaser may sustain, and has the
financial ability to sustain, the loss of his entire investment. The Purchaser
understands and agrees that it must bear the economic risk of its investment in
the Shares for an indefinite period of time. The Shares and the shares of Common
Stock issuable upon conversion of the Shares have not been registered under the
Act. The Shares and the shares of Common Stock issuable upon conversion may not
be offered or sold, directly or indirectly unless registered or exempt from
registration under the Act and any applicable state securities or blue sky laws
(the "State Acts").
(e) If the Purchaser is a corporation or trust or other entity, the officer or
trustee or other person executing this Agreement represents and warrants that he
is authorized to so sign; that the entity is authorized by the governing
documents of the entity as the case may be, to make this investment;
(f) The Purchaser is an "accredited investor" as defined under Regulation D,
promulgated under the Securities Act.
(g) The undersigned (i) has adequate means of providing for his current needs
and possible personal contingencies, and has no need for liquidity of his
investment in the Company, (ii) can bear the economic risk of losing his entire
investment herein, and (iii) has alone, or together with
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his Purchaser Representative (as hereinafter defined), such knowledge and
experience in financial matters that he is capable of evaluating the relative
risks and merits of this investment.
(h) He acknowledges that (i) the person or persons, if any, named at the foot
of this Agreement has or have acted as his "Purchaser Representative" as defined
in Rule 501 under Regulation D of the Securities Act, (ii) in evaluating his
investment as contemplated hereby, he has been advised by his Purchaser
Representative(s), as to the merits and risks of the investment in general and
the suitability of the investment for the undersigned in particular, and (iii)
his Purchaser Representative, if any, has or have confirmed to the undersigned
in writing (a copy of which instrument shall be annexed to this Agreement by the
undersigned upon execution) of any past, present or future material
relationship, actual or contemplated, between the Purchaser Representative and
the Company or any affiliate of the Company.
(i) That it never has been represented, guaranteed, or warranted to him by any
broker, the Company, its officers, directors, its agents, or employees or any
other person, expressly or by implication, as to the percentage of profits
and/or amount of or type of consideration, gain, profit, income or loss
(including tax write-offs and/or tax benefits) to be realized, if any, as a
result of this venture.
(j) That the Company will rely on this offer and the Purchaser's
representations and accordingly this offer may not be canceled, rescinded or
otherwise revoked by the undersigned.
(k) In addition, in the event the undersigned is executing this Agreement on
behalf of an employee benefit plan ("Plan") subject to Title I of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), in accordance with
the provisions of the instrument or instruments governing such Plan and its
related trust, the undersigned is a "fiduciary" of such Plan and trust (within
the meaning of section 3(21) (A) of ERISA), the execution and delivery of this
Agreement with respect to the Plan and trust have been duly authorized; and the
undersigned is aware of, in making this investment, and has taken into
consideration, among other things, risk and return factors and the anticipated
effect of an investment in the Company on the diversification, liquidity and
cash flow needs of the Plan and the projected effect of the investment in
meeting the Plan's funding objectives and has concluded that this investment is
a prudent one.
The foregoing representations and warranties are true and accurate as of the
date hereof and shall be true and accurate as of the date of delivery of the
subscription funds to the Company and shall survive such delivery.
If in any respect such representations and warranties shall not be true and
accurate prior to delivery of the funds, the undersigned shall give written
notice of such fact to the Company, specifying which representations and
warranties are not true and accurate and the reasons therefor. To insure receipt
of such letter by the Company, it should be sent by Certified Mail, Return
Receipt Requested.
5. Representations and Warranties of the Company. The Company represents and
warrants to the Purchaser, except as otherwise disclosed in the Disclosure
Documents, that:
(a) True and correct copies of the Disclosure Documents and the amendments
thereto have been delivered by the Company to the Purchaser.
(b) This Agreement has been duly authorized, validly executed and delivered by
the Company and is a legally valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms.
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(c) The authorized, issued and outstanding capital stock and other securities
of the Company conform in all material respects to the descriptions thereof in
the Disclosure Documents. The shares of authorized, issued and outstanding
capital stock of the Company have been duly authorized and validly issued and
are fully paid, nonassessable and free of preemptive or similar rights. The
Shares to be issued by the Company and the shares of Common Stock to be issued
upon conversion of the Shares have been duly authorized and, when issued and
delivered against payment therefor in accordance with the terms of this
Agreement in the case of the Shares, or upon conversion, with respect to the
Common Stock, will be in the case of the Shares validly issued and outstanding
and will constitute valid and legal obligations of the Company enforceable
against it in accordance with their terms and in the case of the Common Stock,
validly issued, fully paid, nonassessable and free of preemptive or similar
rights.
(d) The Company has been duly organized and is validly existing as corporation
in good standing under the laws of the State of Delaware. The Company has the
power and authority necessary to enter into and perform its obligations under
this Agreement, and to issue, sell and deliver the Shares to be sold by it
pursuant hereto.
6. Indemnification. The undersigned acknowledges that he understands the
meaning and legal consequences of the representations and warranties contained
in Paragraph 4 hereof, and he hereby agrees to indemnify and hold harmless the
Company, the officers, directors, shareholders, employees, agents and each
affiliate, agent or employee thereof from and against any and all loss, damage
or liability due to or arising out of a breach of any representation or warranty
of the undersigned contained in this Agreement.
7. Transferability. The undersigned agrees not to transfer or assign this
Agreement, or any of his interest herein, and further agrees that the assignment
and transferability of the Shares acquired pursuant hereto shall be made only in
accordance with this Agreement.
8. Revocation. The undersigned agrees that he shall not cancel, terminate or
revoke this Agreement or any agreement of the undersigned made hereunder and
that this Agreement shall survive the death or disability of the undersigned.
9. Miscellaneous. Notices given pursuant to any provision of this Agreement
shall be addressed as follows: (i) if to the Company, Voicenet, Inc., attention:
Chief Executive Officer, to the address set forth above, (ii) if to the
Purchaser at the address set forth at the signature page of this Agreement, or
in any case to such other address as the person to be notified may have
requested in writing.
Except as otherwise provided, this Agreement has been and is made solely for the
benefit of and shall be binding upon the Company, you, any controlling persons
referred to herein, and their respective successors and assigns, all as and to
the extent provided in this Agreement, and no other persons shall acquire or
have any right under or by virtue of this Agreement. Your rights under this
Agreement are not assignable.
THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS
THEREOF.
<PAGE>
This Agreement may be signed in various counterparts, which together shall
constitute one and the same instrument. Please confirm that the foregoing
correctly sets forth the agreement between the Company the Purchaser by signing
this Agreement and completing the information requested below.
IN WITNESS WHEREOF, the Purchaser has executed this Agreement, the date set
forth below.
Amount of Shares
subscribed for: US$
-------------------------------------
Name of Purchaser:
By:
(Signature) -------------------------------------
Date:
----------------
Title, if applicable
-------------------------
Address:
-----------------------------------------------------------------------
- -------------------------------------------------------------------------------
Telephone Number:
------------------------
Telecopier Number:
------------------------
Social Security No. or Tax I.D. No. (if applicable):
---------------------
Accepted this day of
-------
, l999
- --------------------
VOICENET, INC.
By:
--------------------------
