SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): February 10, 2000
URSUS TELECOM CORPORATION
(Exact name of registrant as specified in its charter)
Florida 65-0398306
(State or Other Jurisdiction (IRS Employer
of Incorporation or Organization) Identification No.)
440 Sawgrass Corporate Parkway, Suite 112, Sunrise, Florida 33325
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (954-846-7887)
N/A
(Former name, former address and
former fiscal year if changed since last report)
<PAGE>
ITEM 5 OTHER EVENTS
On February 10, 2000, the Company entered into a purchase agreement to sell
615,115 shares of the Company's common stock for $7 million to an institutional
group of investors. The net proceeds to the Company after deducting expenses is
expected to be approximately $6.6 million. The Company also granted the
investors 279,998 five year warrants to buy common stock at $15.3956 per share.
The Company has provided the investors with certain anti-dilution protections
for a maximum of 30 months with respect to the shares sold and warrants issued.
However, except for the warrants, the anti-dilution protection period will end
on the completion of a firm commitment underwritten primary public offering of
stock during calendar year 2000. Under the terms of the anti-dilution clause,
the investors would receive a share price adjustment in the event of a
subsequent issuance of common stock at a price which is less than the price they
paid. Existing employee stock options, warrants and certain other future
issuances as defined in the purchase agreement would be excluded from the
anti-dilution adjustment.
In connection with the sale, the Company entered into a registration rights
agreement with the investors which provides for the registration of the common
stock and the common stock underlying the warrants with the SEC.
ITEM 7 FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION and EXHIBITS
(a) Financial Statements of Businesses Acquired.
Not Applicable
(b) Pro Forma Financial Information.
Not Applicable
(c) Exhibits.
The following exhibits are filed with this Report.
Exhibit No. Description
10.1 Purchase Agreement dated February 10, 2000 by and
between Ursus Telecom Corporation and The Tail Wind
Fund Ltd., Emerge Capital and Resonance Limited
10.2 Registration Rights Agreement dated February 10,
2000 by and between Ursus Telecom Corporation and
The Tail Wind Fund Ltd., Emerge Capital and
Resonance Limited
10.3 Form of Warrant
99.1 Press release dated February 14, 2000
<PAGE>
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 thereunto duly authorized.
URSUS TELECOM CORPORATION
By: /S/ JOHANNES SEEFRIED
--------------------------
Johannes S. Seefried
Chief Financial Officer
and authorized officer of registrant
Dated: February 17, 2000
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
10.1 Purchase Agreement dated February 10, 2000 by and
between Ursus Telecom Corporation and The Tail Wind
Fund Ltd., Emerge Capital and Resonance Limited
10.2 Registration Rights Agreement dated February 10,
2000 by and between Ursus Telecom Corporation and
The Tail Wind Fund Ltd., Emerge Capital and
Resonance Limited
10.3 Form of Warrant
99.1 Press release dated February 14, 2000
Exhibit 10.1
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT ("Agreement") is made as of the 10th day of
February, 2000 by and between Ursus Telecom Corporation, a Florida corporation
(the "Company"), and the Investors set forth on the signature page affixed
hereto (each an "Investor" and collectively the "Investors").
RECITALS
A. The Company and the Investors are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by the provisions of Regulation D ("Regulation D"), as promulgated by the U.S.
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended;
B. The Investors wish to purchase, and the Company wishes to sell and
issue to the Investors, upon the terms and conditions stated in this Agreement,
that number of shares of the common stock of the Company, $0.01 par value per
share (the "Common Stock") and that number of warrants to purchase Common Stock
in the form attached hereto as EXHIBIT A (the "Warrants"), as are set forth on
the signature page attached hereto and executed by each such Investor; and
C. Contemporaneous with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement,
in the form attached hereto as EXHIBIT B (the "Registration Rights Agreement"),
pursuant to which the Company has agreed to provide certain registration rights
under the Securities Act of 1933, as amended and the rules and regulations
promulgated thereunder, and applicable state securities laws;
In consideration of the mutual promises made herein and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. DEFINITIONS. In addition to those terms defined above and elsewhere
in this Agreement, for the purposes of this Agreement, the following terms shall
have the meanings here set forth:
1.1 "AFFILIATE" means, with respect to any Person, any other
Person which directly or indirectly controls, is controlled by, or is under
common control with, such Person.
1.2 "AGREEMENTS" means this Agreement, the Registration
Rights Agreement, and the Warrants.
1.3 "CLOSING" means the consummation of the transactions
contemplated by this Agreement, and "CLOSING DATE" means the date of such
Closing.
1.4 "CONTROL" means the possession , direct or indirect, of
the power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.
1.5 "MARKET PRICE" means the average of the five lowest
closing bid prices of the Common Stock in the twenty-five (25) trading days
immediately preceding the date hereof.
1.6 "MATERIAL ADVERSE EFFECT" means a material adverse
effect on the condition (financial or otherwise), business, assets, or results
of operations of the Company as a whole.
1.7 "PERSON" means an individual, corporation, partnership,
trust, business trust, association, joint stock company, joint venture, pool,
syndicate, sole proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed herein.
1.8 "SEC FILINGS" has the meaning set forth in Section 4.6.
1.9 "SECURITIES" means the Shares, the Warrants and the
Warrant Shares (defined below).
1.10 "SHARES" means the shares of Common Stock being
purchased by the Investors hereunder.
1.11 "WARRANT SHARES" means the shares of Common Stock
issuable upon exercise of or otherwise pursuant to the Warrants.
1.12 "1933 ACT" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
1.13 "1934 ACT" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.
2. PURCHASE AND SALE OF THE SHARES AND WARRANTS. Subject to the terms
and conditions of this Agreement, each of the Investors hereby severally, and
not jointly, agrees to purchase, and the Company hereby agrees to sell and issue
to the Investors, the number of Shares and Warrants to purchase the number of
shares of Common Stock set forth on such Investor's signature page attached
hereto. The number of Shares to be purchased by each Investor shall be
determined by dividing such Investor's aggregate purchase price (as such
aggregate purchase price is set forth on such Investor's signature page attached
hereto), by an amount equal to 85% of the Market Price on the date of this
Agreement (the "Purchase Price"). The number of shares of Common Stock
purchasable by the Investors upon exercise of the Warrants shall be as set forth
on such Investor's signature page attached hereto and the exercise price of the
Warrants shall be 115% of the Market Price on the date of this Agreement;
provided, in no event shall the exercise price of the Warrants be less than the
closing bid price of the Common Stock on the day preceding the date of this
Agreement.
3. CLOSING. The Company shall promptly deliver to Investors' counsel,
in trust, a certificate or certificates, registered in such name or names as the
Investors may designate, representing all of the Shares and all of the Warrants,
with instructions that such certificates are to be held for release to the
Investors only upon payment of the Purchase Price to the Company. Upon receipt
by counsel to the Investors of the certificates, each Investor shall promptly
cause a wire transfer in same day funds to be sent to the account of the Company
as instructed in writing by the Company, in an amount representing such
Investor's Purchase Price. On the date the Company receives such funds, the
certificates evidencing the Shares and the Warrants shall be released to the
Investors (and such date shall be deemed the "Closing Date").
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to the Investors that:
4.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. Each of
the Company and its subsidiaries is a corporation duly incorporated, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and has all requisite corporate power and authority to carry on
its business as now conducted and own its properties. Each of the Company and
its subsidiaries is duly qualified to do business as a foreign corporation and
is in good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property makes such qualification or licensing
necessary unless the failure to so qualify would not have a Material Adverse
Effect. The Company's subsidiaries are reflected on SCHEDULE 4.1 hereto.
4.2 AUTHORIZATION. The Company has full power and authority
and has taken all requisite action on the part of the Company, its officers,
directors and stockholders necessary for (i) the authorization, execution and
delivery of the Agreements, (ii) authorization of the performance of all
obligations of the Company hereunder or thereunder, and (iii) the authorization,
issuance (or reservation for issuance) and delivery of the Securities. The
Agreements constitute the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability, relating to or affecting creditors'
rights generally.
4.3 CAPITALIZATION. Set forth on SCHEDULE 4.3 hereto is (a)
the authorized capital stock of the Company on the date hereof; (b) the number
of shares of capital stock issued and outstanding; (c) the number of shares of
capital stock issuable pursuant to the Company's stock plans; and (d) the number
of shares of capital stock issuable and reserved for issuance pursuant to
securities (other than the Shares and the Warrants) exercisable for, or
convertible into or exchangeable for any shares of capital stock. All of the
issued and outstanding shares of the Company's capital stock have been duly
authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights. Except as set forth on SCHEDULE 4.3, no Person is entitled to
preemptive or similar statutory or contractual rights with respect to any
securities of the Company. Except as set forth on SCHEDULE 4.3, there are no
outstanding warrants, options, convertible securities or other rights,
agreements or arrangements of any character under which the Company or any of
its subsidiaries is or may be obligated to issue any equity securities of any
kind and except as contemplated by this Agreement, neither the Company nor any
of its subsidiaries is currently in negotiations for the issuance of any equity
securities of any kind. Except as set forth on SCHEDULE 4.3, the Company has no
knowledge of any voting agreements, buy-sell agreements, option or right of
first purchase agreements or other agreements of any kind among any of the
securityholders of the Company relating to the securities of the Company held by
them. Except as set forth on SCHEDULE 4.3, the Company has not granted any
Person the right to require the Company to register any securities of the
Company under the 1933 Act, whether on a demand basis or in connection with the
registration of securities of the Company for its own account or for the account
of any other Person.
4.4 VALID ISSUANCE. The Company has reserved a sufficient
number of shares of Common Stock for the issuance of the Shares pursuant to this
Agreement and upon exercise of the Warrants. The Company will take such steps as
may be necessary to reserve sufficient shares for issuance pursuant to Section 7
below when such issuance is determinable. The Shares and Warrants are duly
authorized, and such Securities, along with the Warrant Shares when issued in
accordance herewith and with the terms of the Warrants, will be duly authorized,
validly issued, fully paid, non-assessable and free and clear of all
encumbrances and restrictions, except for restrictions on transfer imposed by
applicable securities laws.
4.5 CONSENTS. The execution, delivery and performance by the
Company of the Agreements and the offer, issuance and sale of the Securities
require no consent of, action by or in respect of, or filing with, any Person,
governmental body, agency, or official other than filings that have been made
pursuant to applicable state securities laws and post-sale filings pursuant to
applicable state and federal securities laws and the requirements of the Nasdaq
Stock Market, which the Company undertakes to file within the applicable time
periods.
4.6 DELIVERY OF SEC FILINGS; BUSINESS. The Company has
provided the Investors with copies of the Company's most recent Annual Report on
Form 10-K for the fiscal year ended March 31, 1999, and all other reports filed
by the Company pursuant to the 1934 Act since the filing of the Annual Report on
Form 10-K and prior to the date hereof (collectively, the "SEC Filings"); which
the Company hereby represents and warrants are all filings required of the
Company pursuant to the 1934 Act for such period. The Company is engaged only in
the business described in the SEC Filings and the SEC Filings contain a complete
and accurate description of the business of the Company.
4.7 USE OF PROCEEDS. The proceeds of the sale of the Common
Stock and the Warrants hereunder shall be used by the Company for working
capital and general corporate purposes.
4.8 NO MATERIAL ADVERSE CHANGE. Since the filing of the
Company's most recent Annual Report on Form 10-K or as otherwise identified and
described in subsequent reports filed by the Company pursuant to the 1934 Act or
as set forth on SCHEDULE 4.8 hereto, there has not been:
(i) any change in the consolidated assets, liabilities,
financial condition or operating results of the Company from that reflected in
the financial statements included in the Company's most recent Quarterly Report
on Form 10-Q, except changes in the ordinary course of business which have not
had, in the aggregate, a Material Adverse Effect;
(ii) any declaration or payment of any dividend, or any
authorization or payment of any distribution, on any of the capital stock of the
Company, or any redemption or repurchase of any securities of the Company;
(iii) any material damage, destruction or loss, whether
or not covered by insurance to any assets or properties of the Company;
(iv) any waiver by the Company of a valuable right or
of a material debt owed to it not in the ordinary course of business;
(v) any satisfaction or discharge of any lien, claim or
encumbrance or payment of any obligation by the Company, except in the ordinary
course of business and which is not material to the assets, properties,
financial condition, operating results or business of the Company taken as a
whole (as such business is presently conducted and as it is proposed to be
conducted);
(vi) any material change or amendment to a material
contract or arrangement by which the Company or any of its assets or properties
is bound or subject;
(vii) any material labor difficulties or labor union
organizing activities with respect to employees of the Company;
(viii) any transaction entered into by the Company
other than in the ordinary course of business; or
(ix) any other event or condition of any character that
might have a Material Adverse Effect.
4.9 SEC FILINGS; MATERIAL CONTRACTS.
(a) The SEC Filings complied as to form in all material
respects with the requirements of the 1934 Act and did not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
(b) During the preceding two years, each registration
statement and any amendment thereto filed by the Company pursuant to the 1933
Act and the rules and regulations thereunder, as of the date such statement or
amendment became effective, complied as to form in all material respects with
the 1933 Act and did not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements made therein, in light of the circumstances under which
they were made, not misleading; and each prospectus filed pursuant to Rule
424(b) under the 1933 Act, as of its issue date and as of the closing of any
sale of securities pursuant thereto did not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements made therein, in the light of the
circumstances under which they were made, not misleading.
(c) Except as set forth on SCHEDULE 4.3 hereto, there
are no agreements or instruments currently in force and effect that constitute a
warrant, option, convertible security or other right, agreement or arrangement
of any character under which the Company is or may be obligated to issue any
material amounts of any equity security of any kind, or to transfer any material
amounts of any equity security of any kind.
4.10 FORM S-3 ELIGIBILITY. The Company is currently eligible
to register the resale of its Common Stock on a registration statement on Form
S-3 under the 1933 Act.
4.11 NO CONFLICT, BREACH, VIOLATION OR DEFAULT. The
execution, delivery and performance of the Agreements by the Company and the
issuance and sale of the Securities will not conflict with or result in a breach
or violation of any of the terms and provisions of, or constitute a default
under (i) the Company's Certificate of Incorporation or the Company's Bylaws,
both as in effect on the date hereof (copies of which have been provided to the
Investors before the date hereof), or (ii) except where it would not have a
Material Adverse Effect, (a) any statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any of its properties, or (b) except as set
forth on SCHEDULE 4.11, any agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the properties of the
Company is subject.
4.12 TAX MATTERS. The Company has timely prepared and filed
all tax returns required to have been filed by the Company with all appropriate
governmental agencies and timely paid all taxes owed by it. The charges,
accruals and reserves on the books of the Company in respect of taxes for all
fiscal periods are adequate in all material respects, and there are no material
unpaid assessments against the Company nor, to the knowledge of the Company, any
basis for the assessment of any additional taxes, penalties or interest for any
fiscal period or audits by any federal, state or local taxing authority except
such as which are not material. All material taxes and other assessments and
levies that the Company is required to withhold or to collect for payment have
been duly withheld and collected and paid to the proper governmental entity or
third party when due. There are no tax liens or claims pending or threatened
against the Company or any of its respective assets or property. There are no
outstanding tax sharing agreements or other such arrangements between the
Company and any other corporation or entity.
4.13 TITLE TO PROPERTIES. Except as disclosed in the SEC
Filings or SCHEDULE 4.13, the Company has good and marketable title to all real
properties and all other properties and assets owned by it, in each case free
from liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or currently planned to be
made thereof by them; and except as disclosed in the SEC Filings, the Company
holds any leased real or personal property under valid and enforceable leases
with no exceptions that would materially interfere with the use made or
currently planned to be made thereof by them.
4.14 CERTIFICATES, AUTHORITIES AND PERMITS. The Company
possesses adequate certificates, authorities or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now operated
by it and has not received any notice of proceedings relating to the revocation
or modification of any such certificate, authority or permit that, if determined
adversely to the Company, would individually or in the aggregate have a Material
Adverse Effect.
4.15 NO LABOR DISPUTES. No material labor dispute with the
employees of the Company exists or, to the knowledge of the Company, is
imminent.
4.16 INTELLECTUAL PROPERTY. The Company has sufficient title
or adequate rights or licenses to the inventions, know-how, patents, copyrights,
trademarks, trade names, confidential information and other intellectual
property (collectively, "Intellectual Property Rights"), free and clear of any
material liens, security interests, charges, encumbrances, equities and other
adverse claims, necessary to conduct the business now operated by it, or
presently employed by it, and presently contemplated to be operated by it, and
the Company has not received any notice of infringement of or conflict with
asserted rights of others with respect to any Intellectual Property Rights. To
the knowledge of the Company, the Company's patents and other Intellectual
Property Rights and the present activities of the Company do not infringe any
patent, copyright, trademark, trade name or other proprietary rights of any
third party.
4.17 ENVIRONMENTAL MATTERS. The Company is not in violation
of any statute, rule, regulation, decision or order of any governmental agency
or body or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, "Environmental Laws"), does not own or operate any
real property contaminated with any substance that is subject to any
Environmental Laws, is not liable for any off-site disposal or contamination
pursuant to any Environmental Laws, and is not subject to any claim relating to
any Environmental Laws, which violation, contamination, liability or claim would
individually or in the aggregate have a Material Adverse Effect; and the Company
is not aware of any pending investigation that might lead to such a claim.
4.18 LITIGATION. Except as disclosed in the SEC Filings or
on SCHEDULE 4.18 hereto, there are no pending actions, suits or proceedings
against or affecting the Company, its subsidiaries or any of its or their
properties that, if determined adversely to the Company or such subsidiary,
would individually or in the aggregate have a Material Adverse Effect or would
materially and adversely affect the ability of the Company to perform its
obligations under this Agreement, or which are otherwise material in the context
of the sale of the Securities; and to the Company's knowledge, no such actions,
suits or proceedings are threatened or contemplated.
4.19 FINANCIAL STATEMENTS. The financial statements included
in each SEC Filing present fairly and accurately in all material respects the
consolidated financial position of the Company as of the dates shown and its
consolidated results of operations and cash flows for the periods shown, and
such financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis. Except as set
forth in the financial statements of the Company included in the SEC Filings
filed prior to the date hereof, to the best of the Company's knowledge, the
Company has no liabilities, contingent or otherwise, except those which
individually or in the aggregate would not have a Material Adverse Effect.
4.20 INSURANCE COVERAGE. The Company maintains in full force
and effect insurance coverage that is customary for comparably situated
companies for the business being conducted and properties owned or leased by the
Company, and the Company reasonably believes such insurance coverage to be
adequate against all liabilities, claims and risks against which it is customary
for comparably situated companies to insure.
4.21 COMPLIANCE WITH NASDAQ CONTINUED LISTING REQUIREMENTS.
The Company is in compliance with all applicable Nasdaq National Market
continued listing requirements. There are no proceedings pending or to the
Company's knowledge threatened against the Company relating to the continued
listing of the Company's Common Stock on the Nasdaq National Market and the
Company has not received any notice of, nor to the knowledge of the Company is
there any basis for, the delisting of the Common Stock from the Nasdaq National
Market.
4.22 ACKNOWLEDGEMENT OF DILUTION. The number of shares of
Common Stock issuable pursuant to this Agreement may increase substantially. The
Company's executive officers and directors have studied and fully understand the
nature of the transactions being contemplated hereunder and recognize that they
have a potential dilutive effect.
4.23 BROKERS AND FINDERS. The Investors shall have no
liability or responsibility for the payment of any commission or finder's fee to
any third party in connection with or resulting from this agreement or the
transactions contemplated by this Agreement by reason of any agreement of or
action taken by the Company. The Investors acknowledge that the Company is
obligated to pay a finder's fee to Swartz LLC equal to 4.5% of the gross
proceeds of this offering plus warrants to acquire 25,000 shares of Common
Stock.
4.24 NO DIRECTED SELLING EFFORTS OR GENERAL SOLICITATION.
Neither the Company nor any Person acting on its behalf has conducted any
general solicitation or general advertising (as those terms are used in
Regulation D) in connection with the offer or sale of any of the Securities.
4.25 NO INTEGRATED OFFERING. Neither the Company nor any of
its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would adversely affect reliance by
the Company on Section 4(2) for the exemption from registration for the
transactions contemplated hereby or would require registration of the Securities
under the 1933 Act.
4.26 DISCLOSURES. No representation or warranty made under
any Section hereof contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained herein, in
light of the circumstances under which the statements were made, not misleading.
5. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR. Each of the
Investors hereby severally, and not jointly, represents and warrants to the
Company that:
5.1 ORGANIZATION AND EXISTENCE. The Investor is a validly
existing corporation or limited liability company and has all requisite
corporate or limited liability company power and authority to invest in the
Securities pursuant to this Agreement.
5.2 AUTHORIZATION. The execution, delivery and performance
by the Investor of the Agreements have been duly authorized and the Agreements
will each constitute the valid and legally binding obligation of the Investor,
enforceable against the Investor in accordance with their terms.
5.3 PURCHASE ENTIRELY FOR OWN ACCOUNT. The Securities to be
received by the Investor hereunder will be acquired for the Investor's own
account, not as nominee or agent, and not with a view to the resale or
distribution of any part thereof, and the Investor has no present intention of
selling, granting any participation in, or otherwise distributing the same. The
Investor is not a registered broker dealer or an entity engaged in the business
of being a broker dealer.
5.4 INVESTMENT EXPERIENCE. The Investor acknowledges that it
can bear the economic risk and complete loss of its investment in the Securities
and has such knowledge and experience in financial or business matters that it
is capable of evaluating the merits and risks of the investment contemplated
hereby.
5.5 DISCLOSURE OF INFORMATION. The Investor has had an
opportunity to receive documents related to the Company and to ask questions of
and receive answers from the Company regarding the Company, its business and the
terms and conditions of the offering of the Securities. The Investor
acknowledges receipt of the SEC Filings and any other filings which it requested
be made by the Company with the SEC. Neither such inquiries nor any other due
diligence investigation conducted by the Investor shall modify, amend or affect
the Investor's right to rely on the Company's representations and warranties
contained in this Agreement.
5.6 RESTRICTED SECURITIES. The Investor understands that the
Securities are characterized as "restricted securities" under the U.S. federal
securities laws inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under
the 1933 Act only in certain limited circumstances.
5.7 LEGENDS. It is understood that, until registration for
resale pursuant to the Registration Rights Agreement, certificates evidencing
the Securities may bear one or all of the following legends:
(a) "The shares represented by this certificate may not
be transferred without (i) the opinion of counsel satisfactory to the
corporation that such transfer may lawfully be made without registration under
the Securities Act of 1933 or qualification under applicable state securities
laws; or (ii) such registration or qualification."
(b) If required by the authorities of any state in
connection with the issuance of sale of the Securities, the legend required by
such state authority.
Upon registration for resale pursuant to the Registration
Rights Agreement or upon Rule 144(k) becoming available, the Company shall
promptly cause certificates evidencing the Shares previously issued hereunder
(including Shares issued pursuant to Section 7.1 below) to be replaced with
certificates which do not bear such restrictive legends, and all Warrant Shares
subsequently issued shall not bear such restrictive legends. When the Company is
required to cause unlegended certificates to replace previously issued legended
certificates, if unlegended certificates are not delivered to an Investor within
ten (10) business days of submission by that Investor of legended stock
certificate(s) to the Company's transfer agent, the Company shall be liable to
the Investor for a penalty equal to 2% of the aggregate Purchase Price of the
Shares evidenced by such certificate(s) for each thirty day period (or portion
thereof) beyond such ten days that the unlegended certificates have not been so
delivered.
5.8 ACCREDITED INVESTOR. The Investor is an accredited
investor as defined in Rule 501(a) of Regulation D, as amended, under the 1933
Act.
5.9 NO GENERAL SOLICITATION. The Investor did not learn of
the investment in the Securities as a result of any public advertising or
general solicitation.
6. REGISTRATION RIGHTS AGREEMENT. The parties acknowledge and agree
that part of the inducement for the Investor to enter into this Agreement is the
Company's execution and delivery of the Registration Rights Agreement. The
parties acknowledge and agree that simultaneously with the execution hereof, the
Registration Rights Agreement is being duly executed and delivered by the
parties thereto.
7. COVENANTS AND AGREEMENTS OF THE COMPANY.
7.1 PURCHASE PRICE ADJUSTMENTS.
(a) REQUIRED ADJUSTMENTS. Subject to the exclusions
contained in Section 7.1(f) below, if during the period the MFN Period (defined
below) the Company issues or sells any shares of its Common Stock at a Per Share
Selling Price (as defined below) lower than the Purchase Price per share set
forth in Section 2 hereof, the Purchase Price per share of the Shares sold to
the Investors hereunder shall be adjusted downward to equal such lower Per Share
Selling Price and Investors shall be entitled to receive the additional shares
as provided by Section 7.1(c); provided, however, that in the event an Investor
then owns less than 51% of the Shares acquired by it hereunder, such Investor
shall be entitled to additional shares only with respect to the number of Shares
then owned by such Investor as provided in Section 7.1(c). The Company shall
give to the Investors written notice of any such sale within 24 hours of the
closing of any such issuance or sale. For so long as an Investor owns 51% or
more of the Shares originally acquired by such Investor hereunder, such Investor
shall be entitled to the full benefit of the Purchase Price adjustment required
by this Section 7.1. The term "Shares" as used in this Agreement shall include
shares issued to the Investors pursuant to this Section 7.1.
(b) DEFINITIONS.
(i) For the purposes of this Section 7.1, the term
"Per Share Selling Price" as used in this Section 7.1 shall include the amount
actually paid by third parties for each share of Common Stock. In the event a
fee in excess of 5.5% is paid by the Company in connection with such
transaction, any such excess amount shall be deducted from the selling price pro
rata to all shares sold in the transaction to arrive at the Per Share Selling
Price. A sale in a capital raising transaction of shares of Common Stock shall
include the sale or issuance of rights, options, warrants or convertible
securities under which the Company is or may become obligated to issue shares of
Common Stock, and in such circumstances the Per Share Selling Price of the
Common Stock covered thereby shall also include the exercise or conversion price
thereof (in addition to the consideration received by the Company upon such sale
or issuance less the excess fee amount as provided above). In case of any such
security issued within the MFN Period in a "Variable Rate Transaction" or an
"MFN Transaction" (each as defined below), the Per Share Selling Price shall be
deemed to be the lowest conversion or exercise price at which such securities
are converted or exercised or might have been converted or exercised in the case
of a Variable Rate Transaction, or the lowest adjustment price in the case of an
MFN Transaction, over the life of such securities. If shares are issued for a
consideration other than cash, the Per Share Selling Price shall be the fair
value of such consideration as determined in good faith by independent certified
public accountants mutually acceptable to the Company and the Investors.
(ii) The term "Variable Rate Transaction" shall
mean a transaction in which the Company issues or sells (a) any debt or equity
securities that are convertible into, exchangeable or exercisable for, or
include the right to receive additional shares of Common Stock either (x) at a
conversion, exercise or exchange rate or other price that is based upon and/or
varies with the trading prices of or quotations for the Common Stock at any time
after the initial issuance of such debt or equity securities, or (y) with a
fixed conversion, exercise or exchange price that is subject to being reset at
some future date after the initial issuance of such debt or equity security or
upon the occurrence of specified or contingent events directly or indirectly
related to the business of the Company or the market for the Common Stock (but
excluding standard stock split anti-dilution provisions), or (b) any securities
of the Company pursuant to an "equity line" structure which provides for the
sale, from time to time, of securities of the Company which are registered for
resale pursuant to the 1933 Act.
(iii) The term "MFN Transaction" shall mean a
transaction in which the Company issues or sells any securities in a capital
raising transaction or series of related transactions (the "New Offering") which
grants to the investor (the "New Investor") the right to receive additional
securities based upon future capital raising transactions of the Company on
terms more favorable than those granted to the New Investor in the New Offering.
(iv) The term "MFN Period" shall mean the period
ending thirty (30) months following the date of this agreement; provided,
however, that if during calendar year 2000 the Company completes a firm
commitment underwritten primary public offering (other than a "shelf"
registration of securities by the Company to which this proviso shall not apply)
of its Common Stock, the MFN period will terminate on the day after the public
sale of such Common Stock.
(c) ADJUSTMENT MECHANISM. If an adjustment of the
Purchase Price is required pursuant to Section 7.1(a), the Company shall deliver
to the Investors within twenty (20) calendar days of the closing of the
transaction giving rise to the adjustment ("Delivery Date") each Investor's
pro-rata share of such number of additional shares of Common Stock equal to (i)
the aggregate Purchase Price paid by the Investor divided by the adjusted per
share purchase price as required under Section 7.1(a), minus (ii) the total
number of shares of Common Stock previously delivered to that Investor
hereunder; provided however, that the Company shall effect such adjustment in
cash, in whole or in part, to the extent required by Section 7.1(d). In the
event the Company fails to deliver the additional shares (or cash, as the case
may be) by the Delivery Date, the Company shall be liable to the Investors for a
penalty equal to 2% of the aggregate Purchase Price adjustment per month (in
each instance to such Investor pro rata in accordance with its participation in
this offering), payable in Common Stock or cash, at each Investor's election.
(d) LIMITATION ON NUMBER OF SHARES.
(i) If by way of any adjustment required by this
Section 7.1, an Investor would receive a number of shares of Common Stock such
that the total number of such shares held by the Investor as of the date of such
adjustment would be greater than 9.90% but less than 13.0% of the total
outstanding Common Stock of the Company, then the Company shall not effect the
adjustment required by this Section to the extent necessary to avoid causing the
aforesaid limitation to be exceeded until 120 days following the date such
adjustment would have otherwise been made.
(ii) If by way of any adjustment required by this
Section 7.1, the Investor would receive a number of shares of Common Stock such
that the total number of such shares held by the Investor as of the date of such
adjustment would equal or exceed 13.0% of the total outstanding Common Stock of
the Company, then the Company shall not effect the adjustment required by this
Section to the extent necessary to avoid causing the aforesaid limitation to be
exceeded until 180 days following the date such adjustment would have otherwise
been made.
(iii) In the event that the Company would be
obligated to issue an amount of shares of Common Stock which, when aggregated
with all shares of Common Stock issued to an Investor, would constitute a breach
of the Company's obligations under the rules or regulations of Nasdaq as they
apply to the Company, or any other principal securities exchange or market upon
which the Common Stock is or becomes traded (the "Cap Regulations"), the Company
shall not be obligated to issue any such shares of Common Stock. Instead, the
Company shall immediately seek shareholder approval of this transaction (with
voting in accordance with the Cap Regulations and other applicable law) if such
approval would, under the Cap Regulations, permit the Company to issue the
shares of Common Stock without violation of the Cap Regulations. If such
shareholder approval will not afford a cure of the breach of the Cap
Regulations, or if such shareholder approval is not obtained within ninety (90)
days, then the Company shall promptly redeem the Investor at a redemption price
equal to 110% of the cash value of the adjustment. Only shares acquired pursuant
to this Agreement will be included in determining whether the limitations would
be exceeded for purposes of this Section 7.1(d)(iii).
(e) CAPITAL ADJUSTMENTS. In case of any stock split or
reverse stock split, stock dividend, reclassification of the common stock,
recapitalization, merger or consolidation, or like capital adjustment affecting
the Common Stock of the Company, the provisions of Section 7.1 shall be applied
in a fair, equitable and reasonable manner so as to give effect, as nearly as
may be, to the purposes hereof.
(f) EXCLUSIONS. Section 7.1(a) shall not apply to:
(i) issuances of options to acquire or shares of
Common Stock by the Company pursuant to the provisions of any existing
shareholder-approved option or similar employee benefit plan heretofore adopted
by the Company or issuances of up to 1,000,000 additional shares of Common Stock
to directors or employees of the Company pursuant to the provisions of any
subsequently adopted shareholder-approved option or similar employee benefit
plan; or
(ii) sales of shares of Common Stock by the
Company upon conversion or exercise of any convertible securities, options or
warrants outstanding prior to the date hereof; or
(iii) issuances by the Company of up to 2,000,000
shares of Common Stock in the aggregate so long as within the following
categories (issuances in excess of any of the thresholds in any of the
categories shall be subject to Section 7.1(a)): (A) the issuance by the Company
of up to 750,000 shares of Common Stock during each of the two fifteen (15)
month periods of the MFN Period as consideration for the acquisition by the
Company of one or more privately held entities; (B) the issuance by the Company
of up to 750,000 shares of Common Stock during each of the two fifteen (15)
month periods of the MFN Period as consideration for the acquisition by the
Company of one or more publicly traded companies; (C) the issuance by the
Company of up to 400,000 shares of Common Stock to corporate strategic partners
of the Company in connection with the formation of joint ventures or marketing
agreements; and (D) the issuance by the Company of up to 100,000 shares of
Common Stock to consultants of the Company in consideration for services to be
rendered to the Company.
7.2 LIMITATION ON TRANSACTIONS.
(a) Until the date of effectiveness of the
Registration Statement covering the Shares as contemplated by the Registration
Rights Agreement, without the prior written consent of the Investors (which
consent may be withheld in the Investors' discretion), the Company shall not
issue or sell or agree to issue or sell for cash any securities in a capital
raising transaction, and until the date that is at least 22 trading days (plus
that number of days, if any of an "Allowed Delay" or a "Blackout Period" under
the Registration Rights Agreement) after the Investors have received the
Company's written notice of the effectiveness of the Registration Statement
covering the Shares, a firm commitment underwritten primary public offering
(other than a "shelf" registration of securities by the Company) of the
Company's securities may not be declared effective.
(b) Until the expiration of the MFN Period,
without the prior written consent of the Investors (which consent may be
withheld in the Investors' discretion), the Company shall not (i) issue or sell
or agree to issue or sell for cash any securities in a MFN Transaction; or (ii)
issue or sell, or agree to issue or sell, for cash any securities in a Variable
Rate Transaction.
(c) Subject to any consent or approval rights of
the Investor hereunder, in the event the Company contemplates a private offering
of its equity or debt securities within six months of the date hereof, the
Company agrees that, upon the request of the Investors, the Company shall first
disclose the terms and conditions and other relevant facts of such proposed
transaction to Nasdaq and obtain from Nasdaq its assurance that such transaction
will not be integrated with the offering which is the subject of this Agreement
for purposes of the Nasdaq rules requiring shareholder approval of the issuance
of 20% or more of an issuer's outstanding common stock. In the event the Company
fails to seek or obtain such assurances, then, at the election of an Investor,
the Company shall redeem the Common Stock purchased by such Investor at 120% of
the original per share Purchase Price paid by the Investor for all Common Stock
then held by such Investor.
7.3 RIGHT OF THE INVESTORS TO PARTICIPATE IN FUTURE
TRANSACTIONS. Until the expiration of the MFN Period, the Investors will have a
right to participate in future capital raising transactions on the terms and
conditions set forth in this Section 7.3. During such period, the Company shall
give seven (7) business days advance written notice to the Investor prior to any
non-public offer or sale of any of the Company's equity securities or any
securities convertible into or exchangeable or exercisable for such securities
by providing to the Investors a comprehensive term sheet containing all
significant business terms of such a proposed transaction. The Investors shall
have the right (pro rata in accordance with the Investors' participation in this
offering) to purchase up to 50% of such securities which are the subject of such
a proposed transaction for the same consideration and on the same terms and
conditions as contemplated for such third-party sale. The Investor(s)' rights
hereunder must be exercised in writing by the Investor(s) within five (5)
business days following receipt of the notice from the Company. If, subsequent
to the Company giving notice to an Investor hereunder but prior to the Investor
exercising its right to participate (or the expiration of the five-day period
without response from the Investor), the terms and conditions of the proposed
third-party sale are changed from that disclosed in the comprehensive term sheet
provided to such Investor, the Company shall be required to provide a new notice
to the Investor hereunder and the Investors shall have the right, which must be
exercised within five (5) business days of such new notice, to exercise their
rights to purchase the securities on such changed terms and conditions as
provided hereunder. In the event the Investors do not exercise their rights
hereunder, or affirmatively decline to engage in the proposed transaction with
the Company, then the Company may proceed with such proposed transaction on the
same terms and conditions as noticed to the Investors (assuming the Investors
have consented to the transaction, if required, pursuant to Section 7.2 of this
Agreement). The rights and obligations of this Section 7.3 shall in no way
diminish the other rights of the Investor pursuant to this Section 7.
7.4 OPINION OF COUNSEL. On or prior to the Closing Date, the
Company will deliver to the Investors the opinion of legal counsel to the
Company, in form and substance reasonably acceptable to the Investors,
addressing those legal matters set forth in SCHEDULE 7.4 hereto.
7.5 RESERVATION OF COMMON STOCK PURSUANT TO SECTION 7.1 AND
EXERCISE OF WARRANTS. The Company hereby agrees at all times to reserve and keep
available out of its authorized but unissued shares of Common Stock, solely for
the purpose of providing for the exercise of the Warrants, such number of shares
of Common Stock as shall from time to time equal the number of shares sufficient
to permit the exercise of the Warrants in accordance with the terms of the
Warrants. In addition, as soon as such number is determinable, the Company
agrees to reserve such shares as may be necessary to permit the issuances to the
Investors required by Section 7.1.
In addition, as soon as such number is determinable, the
Company agrees to reserve such shares as may be necessary to permit the
issuances to the Investors required by Section 7.1.
7.6 REPORTS. For so long as the Investors beneficially own
any of the Securities, the Company will furnish to the Investors the following
reports, each of which shall be provided to the Investors by air mail (within
one week of filing with the SEC, in the case of SEC filings):
(a) QUARTERLY REPORTS. The Company's quarterly
report on Form 10-Q or, in the absence of such report, consolidated balance
sheets of the Company as at the end of such period and the related consolidated
statements of operations, stockholders' equity and cash flows for such period
and for the portion of the Company's fiscal year ended on the last day of such
quarter, all in reasonable detail and certified by a principal financial officer
of the Company to have been prepared in accordance with generally accepted
accounting principles, subject to year-end and audit adjustments.
(b) ANNUAL REPORTS. The Company's Form 10-K or, in
the absence of a Form 10-K, consolidated balance sheets of the Company as at the
end of such year and the related consolidated statements of earnings,
stockholders' equity and cash flows for such year, all in reasonable detail and
accompanied by the report on such consolidated financial statements of an
independent certified public accountant selected by the Company and reasonably
satisfactory to the Investor.
(c) SECURITIES FILINGS. Copies of (i) all notices,
proxy statements, financial statements, reports and documents as the Company
shall send or make available generally to its stockholders or to financial
analysts, promptly after providing same to the stockholders and (ii) all
periodic and special reports, documents and registration statements (other than
on Form S-8) which the Company furnishes or files, or any officer or director of
the Company (in such person's capacity as such) furnishes or files with the SEC.
(d) OTHER INFORMATION. Such other information
relating to the Company as from time to time may reasonably be requested by the
Investors provided the Company produces such information in its ordinary course
of business, and further provided that the Company, solely in its own
discretion, determines that such information is not confidential in nature and
disclosure to the Investor would not be harmful to the Company.
7.7 PRESS RELEASES. Any press release or other publicity
concerning this Agreement or the transactions contemplated by this Agreement
shall be submitted to the Investors for comment at least two (2) business days
prior to issuance, unless the release is required to be issued within a shorter
period of time by law or pursuant to the rules of a national securities
exchange.
7.8 NO CONFLICTING AGREEMENTS. The Company will not take any
action, enter into any agreement or make any commitment that would conflict or
interfere in any material respect with the obligations to the Investors under
the Agreements.
7.9 INSURANCE. So long as the Investors beneficially own any
Securities, the Company shall not materially reduce the insurance coverages set
forth in SCHEDULE 4.20.
7.10 COMPLIANCE WITH LAWS. So long as the Investors
beneficially own any Securities, the Company will use reasonable efforts to
comply with all applicable laws, rules, regulations, orders and decrees of all
governmental authorities, except to the extent non-compliance (in one instance
or in the aggregate) would not have a Material Adverse Effect.
7.11 LISTING OF UNDERLYING SHARES AND RELATED MATTERS. The
Company hereby agrees, promptly following the Closing of the transactions
contemplated by this Agreement, to take such action to cause the Shares and the
Warrant Shares to be listed on the Nasdaq National Market as promptly as
possible but no later than the effective date of the registration contemplated
by the Registration Rights Agreement. The Company further agrees that if the
Company applies to have its Common Stock or other securities traded on any other
principal stock exchange or market, it will include in such application the
Warrant Shares and will take such other action as is necessary to cause such
Common Stock to be so listed. For so long as the Investors beneficially own any
of the Securities, the Company will take all action necessary to continue the
listing and trading of its Common Stock on the Nasdaq National Market and will
comply in all respects with the Company's reporting, filing and other
obligations under the bylaws or rules of such exchange, as applicable, to ensure
the continued eligibility for trading of the Shares and the Warrant Shares
thereon.
7.12 CORPORATE EXISTENCE. So long as the Investors
beneficially own any of the Shares or Warrants, the Company shall maintain its
corporate existence, except in the event of a merger, consolidation or sale of
all or substantially all of the Company's assets, as long as the surviving or
successor entity in such transaction (a) assumes the Company's obligations
hereunder and under the agreements and instruments entered into in connection
herewith, regardless of whether or not the Company would have had a sufficient
number of shares of Common Stock authorized and available for issuance in order
to fulfill its obligations hereunder and effect the exercise in full of all
Warrants outstanding as of the date of such transaction; (b) has no legal,
contractual or other restrictions on its ability to perform the obligations of
the Company hereunder and under the agreements and instruments entered into in
connection herewith; and (c) is a publicly traded corporation whose common stock
and the shares of capital stock issuable upon exercise of the Warrants are (or
would be upon issuance thereof) listed for trading on the Nasdaq National
Market, the Nasdaq SmallCap Market, the New York Stock Exchange or the American
Stock Exchange.
8. SURVIVAL. All representations, warranties, covenants and agreements
contained in this Agreement shall be deemed to be representations, warranties,
covenants and agreements as of the date hereof and shall survive the execution
and delivery of this Agreement for a period of three years from the date of this
Agreement; provided, however, that the provisions contained in Section 7 hereof
shall survive in accordance therewith.
9. MISCELLANEOUS.
9.1 SUCCESSORS AND ASSIGNS. This Agreement may not be
assigned by a party hereto without the prior written consent of the other party
hereto, except that without the prior written consent of the Company, but after
notice duly given, an Investor may assign its rights and delegate its duties
hereunder in whole or in part to an Affiliate or to a third party acquiring some
portion or all of its Shares in a private transaction, and without the prior
written consent of the Investors, but after notice duly given and in compliance
with this Agreement, the Company may assign its rights and delegate its duties
hereunder to any successor-in-interest corporation in the event of a merger or
consolidation of the Company with or into another corporation, or any merger or
consolidation of another corporation with or into the Company that results
directly or indirectly in an aggregate change in the ownership or control of
more than 50% of the voting rights of the equity securities of the Company, or
the sale of all or substantially all of the Company's assets. The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
9.2 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.3 TITLES AND SUBTITLES. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
9.4 NOTICES. Unless otherwise provided, any notice required
or permitted under this Agreement shall be given in writing and shall be deemed
effectively given only upon delivery to each party to be notified by (i)
personal delivery, (ii) telex or telecopier, upon receipt of confirmation of
complete transmittal, or (iii) an internationally recognized overnight air
courier, addressed to the party to be notified at the address as follows, or at
such other address as such party may designate by ten days' advance written
notice to the other party:
If to the Company:
Ursus Telecom Corporation
440 Sawgrass Corporate Parkway
Sunrise, FL 33325
Attn: Johannes Seefried
Chief Financial Officer
Fax: (954) 846-7884
If to the Investors, to the addresses set forth on
the signature pages hereto.
9.5 EXPENSES. The parties hereto shall pay their own costs
and expenses in connection herewith, except that the Company shall pay to Tail
Wind, Inc. a sum equal to 1% of the Purchase Price paid by each Investor as and
for reimbursement for legal and due diligence expenses incurred in connection
herewith and such amount shall be paid at Closing from gross proceeds of the
offering.
9.6 AMENDMENTS AND WAIVERS. Any term of this Agreement may
be amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Investors.
Any amendment or waiver effected in accordance with this paragraph shall be
binding upon each holder of any Securities purchased under this Agreement at the
time outstanding, each future holder of all such securities, and the Company.
9.7 SEVERABILITY. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
9.8 ENTIRE AGREEMENT. This Agreement, including the Exhibits
and Schedules hereto, and the Registration Rights Agreement constitute the
entire agreement among the parties hereof with respect to the subject matter
hereof and thereof and supersede all prior agreements and understandings, both
oral and written, between the parties with respect to the subject matter hereof
and thereof.
9.9 FURTHER ASSURANCES. The parties shall execute and
deliver all such further instruments and documents and take all such other
actions as may reasonably be required to carry out the transactions contemplated
hereby and to evidence the fulfillment of the agreements herein contained.
9.10 APPLICABLE LAW. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York without
regard to principles of conflicts of laws.
[Remainder of Page Intentionally Blank.]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
The Company: URSUS TELECOM CORPORATION
By: /s/ Luca M. Giussani
---------------------
Name: Luca M. Giussani
Title: Chief Exeuctive Officer
<PAGE>
The Investor: THE TAIL WIND FUND LTD.
By: /s/ Jason McCarroll
------------------------
Name: Jason McCarroll
Title: Director
By: /s/ Joan Thompson
-------------------------
Name: Joan Thompson
Title: Director
Aggregate Purchase Price: $4,400,000
Number of Shares of Common Stock: 386,643
Number of Warrants: 248,798
(56,545 per $1 million invested)
Effective per share Purchase Price of Shares: $11.38
Exercise price of Warrants: $15.3956
Address for Notice:
The Tail Wind Fund Ltd.
MeesPierson (Bahamas) Ltd.
Attn: Jason McCarroll
Windemere House, 404 East Bay Street
P.O. Box SS 5539, Nassau, Bahamas
Tel: 242/393-8777 Fax: 242/393-9021
with a copy to:
David Crook, Esq.
The Tail Wind Fund Ltd.
c/o EASI
4th Floor, No. 1 Regent Street
London, SW1Y 4NS UK
Telephone: 44-171-468-7660
Facsimile: 44-171-468-7657
and with a copy to:
Bryan Cave LLP
700 Thirteenth Street, NW
Washington, DC 20005
Attn: LaDawn Naegle
Telephone: 202/508-6046
Facsimile: 202/508-6200
<PAGE>
The Investor: RESONANCE LIMITED
By: /s/ M. Mandel
------------------------
Name: M. Mandel
Title: President
Aggregate Purchase Price: $2,000,000
Number of Shares of Common Stock: 175,747
Number of Warrants: 24,000
(12,000 per $1 million invested)
Effective per share Purchase Price of Shares: $11.38
Exercise price of Warrants: $15.3956
Address for Notice:
[---------------------]
[---------------------]
[---------------------]
[---------------------]
[---------------------]
with a copy to:
Bryan Cave LLP
700 Thirtheenth Street, NW
Washington, DC 20005
Attn: LaDawn Naegle
Telephone: 202/508/6046
Facsimile: 202/508/6200
<PAGE>
The Investor: EMERGE CAPITAL
By: /s/ Michael de Beaumont
------------------------
Name: Michael de Beaumount
Title: Director
Aggregate Purchase Price: $600,010.50
Number of Shares of Common Stock: 52,725
Number of Warrants: 7,200
(12,000 per $1 million invested)
Effective per share Purchase Price of Shares: $11.38
Exercise price of Warrants: $15.3956
Address for Notice:
Emerge Capital
69, Route D'esch
L-2953
Luxembourg
with a copy to:
Bryan Cave LLP
700 Thirtheenth Street, NW
Washington, DC 20005
Attn: LaDawn Naegle
Telephone: 202/508/6046
Facsimile: 202/508/6200
Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and
entered into as of this 10th day of February, 2000 by and between Ursus Telecom
Corporation, a Florida corporation (the "Company"), and the "Investors" named in
that Purchase Agreement of even date herewith by and between the Company and the
Investors (the "Purchase Agreement").
The parties hereby agree as follows:
1. CERTAIN DEFINITIONS.
As used in this Agreement, the following terms shall have the
following meanings:
"ADDITIONAL REGISTRABLE SECURITIES" shall mean the shares of
Common Stock, if any, issued to the Investors pursuant to Section 7.1 of the
Purchase Agreement.
"COMMON STOCK" shall mean the Company's Common Stock, par value
$0.01 per share.
"INVESTORS" shall mean the purchasers identified in the Purchase
Agreement and any affiliate or permitted transferee of any Investor who is a
subsequent holder of any Warrants, Registrable Securities or Additional
Registrable Securities.
"PROSPECTUS" shall mean the prospectus included in any
Registration Statement, as amended or supplemented by any prospectus supplement,
with respect to the terms of the offering of any portion of the Registrable
Securities or Additional Registrable Securities covered by such Registration
Statement and by all other amendments and supplements to the prospectus,
including post-effective amendments and all material incorporated by reference
in such prospectus.
"REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration made by preparing and filing a registration statement or similar
document in compliance with the 1933 Act (as defined below), and the declaration
or ordering of effectiveness of such registration statement or document.
"REGISTRABLE SECURITIES" shall mean the shares of Common Stock
issued and issuable to the Investors pursuant to the Purchase Agreement (other
than additional shares of Common Stock issuable pursuant to Section 7.1 of the
Purchase Agreement) and issuable upon the exercise of the Warrants, and any
other securities issued or issuable with respect to or in exchange for
Registrable Securities.
"REGISTRATION STATEMENT" shall mean any registration statement of
the Company filed under the 1933 Act that covers the resale of any of the
Registrable Securities or Additional Registrable Securities pursuant to the
provisions of this Agreement, amendments and supplements to such Registration
Statement, including post-effective amendments, all exhibits and all material
incorporated by reference in such Registration Statement.
"SEC" means the U.S. Securities and Exchange Commission.
"1933 ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"1934 ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"WARRANTS" mean the warrants to purchase shares of Common Stock
issued to the Investors pursuant to the Purchase Agreement, the form of which is
attached to the Purchase Agreement as Exhibit A.
2. REGISTRATION.
(a) REGISTRATION STATEMENTS.
(i) REGISTRABLE SECURITIES. Promptly following the closing
of the purchase and sale of Common Stock and Warrants contemplated by the
Purchase Agreement (the "Closing Date") (but no later than thirty (30) days
after the Closing Date), the Company shall prepare and file with the SEC one
Registration Statement on Form S-3 (or, if Form S-3 is not then available to the
Company, on such form of registration statement as is then available to effect a
registration for resale of the Registrable Securities, subject to the Investors'
consent), covering the resale of the Registrable Securities in an amount equal
to the number of shares of Common Stock issued to the Investors on the Closing
Date plus the number of shares of Common Stock necessary to permit the exercise
in full of the Warrants. Such Registration Statement also shall cover, to the
extent allowable under the 1933 Act and the Rules promulgated thereunder
(including Rule 416), such indeterminate number of additional shares of Common
Stock resulting from stock splits, stock dividends or similar transactions with
respect to the Registrable Securities. The Company shall use its best efforts to
obtain from each person who now has piggyback registration rights a waiver of
those rights with respect to the Registration Statement. Except up to 50,000
shares of Common Stock underlying certain warrants issued by the Company and
identified to the Investors, no securities shall be included in the Registration
Statement without the consent of each Investor. The Registration Statement (and
each amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section 3(c) to the
Investors and their counsel prior to its filing or other submission.
(ii) ADDITIONAL REGISTRABLE SECURITIES. Upon the written
demand of any Investor and following the issuance of any additional shares of
Common Stock to such Investor pursuant to Section 7.1, of the Purchase
Agreement, the Company shall prepare and file with the SEC one Registration
Statement on Form S-3 (or, if Form S-3 is not then available to the Company, on
such form of registration statement as is then available to effect a
registration for resale of the Additional Registrable Securities, subject to the
Investor's consent) covering the resale of the Additional Registrable Securities
in an amount equal to the number of shares of Common Stock issued to such
Investor. Such Registration Statement also shall cover, to the extent allowable
under the 1933 Act and the Rules promulgated thereunder (including Rule 416),
such indeterminate number of additional shares of Common Stock resulting from
stock splits, stock dividends or similar transactions with respect to the
Additional Registrable Securities. The Company shall use its best efforts to
obtain from each person who now has piggyback registration rights a waiver of
those rights with respect to the Registration Statement. Except up to 50,000
shares of Common Stock underlying certain warrants issued by the Company and
identified to the Investors, no securities shall be included in the Registration
Statement without the consent of the Investor. The Registration Statement (and
each amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section 3(c) to the
Investor and its counsel prior to its filing or other submission.
(b)EXPENSES. The Company will pay all expenses associated
with each registration, including the Investors' reasonable expenses in
connection with the registration but excluding discounts, commissions, fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals.
(c) EFFECTIVENESS.
(i) The Company shall use its best efforts to have each
Registration Statement declared effective as soon as practicable. if (A) the
Registration Statement covering Registrable Securities is not declared effective
by the SEC within three (3) months following the Closing Date, or the
Registration Statement covering Additional Registrable Securities is not
declared effective by the SEC within three (3) months following the demand of an
Investor relating to the Additional Registrable Securities covered thereby, or
with respect to either a Registration Statement which is subject to full review
by the SEC staff (which shall not include a "plain English" review), within four
(4) months following the Closing Date or demand, as the case may be (each, a
"Registration Date"), (B) after a Registration Statement has been declared
effective by the SEC, sales cannot be made pursuant to such Registration
Statement for any reason (including without limitation by reason of a stop
order, or the Company's failure to update the Registration Statement) but except
as excused pursuant to subparagraph (ii) below, or (C) the Common Stock
generally or the Registrable Securities specifically are not listed or included
for quotation on the Nasdaq National Market System, the Nasdaq Small Cap Market,
the New York Stock Exchange or the American Stock Exchange, then the Company
will make pro-rata payments to each Investor, as liquidated damages and not as a
penalty, in an amount equal to 2% of the aggregate amount paid by such Investor
on the Closing Date to the Company for shares of Common Stock still held by such
Investor for any month or pro rata for any portion thereof following the
Registration Date during which any of the events described in (A) or (B) or (C)
above occurs and is continuing (the "Blackout Period"), provided, however, that
in the case of the events described in (A) or (B) above with respect only to the
Additional Registrable Securities, such penalty shall equal 2% of the aggregate
market value of such Additional Registrable Securities for the duration of the
Blackout Period. Each such payment shall be due and payable within five (5) days
of the end of each month (or ending portion thereof) of the Blackout Period.
Such payments shall be in partial compensation to the Investors, and shall not
constitute the Investors' exclusive remedy for such events. The Blackout Period
shall terminate upon (x) the effectiveness of the applicable Registration
Statement in the case of (A) and (B) above; (y) listing or inclusion of the
Common Stock on the Nasdaq National Market System, the Nasdaq Small Cap Market,
the New York Stock Exchange or the American Stock Exchange in the case of (C)
above; and (z) in the case of the events described in (A) or (B) above, the
earlier termination of the Registration Period (as defined in Section 3(a)
below). The amounts payable as liquidated damages pursuant to this paragraph
shall be payable, at the option of the Investors, in lawful money of the United
States or in shares of Common Stock at the Market Price (as defined in the
Purchase Agreement), and amounts payable as liquidated damages shall be paid
monthly within two (2) business days of the last day of each month following the
commencement of the Blackout Period until the termination of the Blackout
Period. Amounts payable as liquidated damages hereunder shall cease when an
Investor no longer holds Warrants or Registrable Securities, or Additional
Registrable Securities, as applicable.
(ii) For not more than ten (10) consecutive trading days or
for a total of not more than twenty (20) trading days in any twelve (12) month
period, the Company may delay the disclosure of material non-public information
concerning the Company, by terminating or suspending effectiveness of any
registration contemplated by this Section containing such information, the
disclosure of which at the time is not, in the good faith opinion of the
Company, in the best interests of the Company (an "Allowed Delay"); provided,
that the Company shall promptly (a) notify the Investors in writing of the
existence of (but in no event, without the prior written consent of an Investor,
shall the Company disclose to such Investor any of the facts or circumstances
regarding) material non-public information giving rise to an Allowed Delay, and
(b) advise the Investors in writing to cease all sales under the Registration
Statement until the end of the Allowed Delay. The duration of the Restricted
Period provided for in the Purchase Agreement will be extended by the number of
days of any and all Allowed Delays.
(d) UNDERWRITTEN OFFERING. If any offering pursuant to a
Registration Statement pursuant to Section 2(a) hereof involves an underwritten
offering, the Company shall have the right to select an investment banker and
manager to administer the offering, which investment banker or manager shall be
reasonably satisfactory to the Investors.
3. COMPANY OBLIGATIONS. The Company will use its best efforts to
effect the registration of the Registrable Securities and Additional Registrable
Securities in accordance with the terms hereof, and pursuant thereto the Company
will, as expeditiously as possible:
(a) use its best efforts to cause such Registration
Statement to become effective and to remain continuously effective for a period
that will terminate upon the earlier of (i) the date on which all Registrable
Securities or Additional Registrable Securities, as the case may be, covered by
such Registration Statement, as amended from time to time, have been sold, and
(ii) the date on which all Registrable Securities or Additional Registrable
Securities, as the case may be, may be sold pursuant to Rule 144(k) (the
"Registration Period");
(b) prepare and file with the SEC such amendments and
post-effective amendments to the Registration Statement and the Prospectus as
may be necessary to keep the Registration Statement effective for the period
specified in Section 3(a) and to comply with the provisions of the 1933 Act and
the 1934 Act with respect to the distribution of all Registrable Securities and
Additional Registrable Securities; provided that, at least five (5) business
days prior to the filing of a Registration Statement or Prospectus, or any
amendments or supplements thereto, the Company will furnish to the Investors
copies of all documents proposed to be filed, which documents will be subject to
the comments of the Investors, which must be received within such five (5)
business day period;
(c) permit counsel designated by the Investors to review
each Registration Statement and all amendments and supplements thereto no fewer
than seven (7) days prior to their filing with the SEC and not file any document
to which such counsel reasonably objects;
(d) furnish to the Investors and their legal counsel (i)
promptly after the same is prepared and publicly distributed, filed with the
SEC, or received by the Company, one copy of any Registration Statement and any
amendment thereto, each preliminary prospectus and Prospectus and each amendment
or supplement thereto, and each letter written by or on behalf of the Company to
the SEC or the staff of the SEC, and each item of correspondence from the SEC or
the staff of the SEC, in each case relating to such Registration Statement
(other than any portion of any thereof which contains information for which the
Company has sought confidential treatment), and (ii) such number of copies of a
Prospectus, including a preliminary prospectus, and all amendments and
supplements thereto and such other documents as each Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities and
Additional Registrable Securities owned by such Investor;
(e) in the event the Company selects an underwriter for the
offering, the Company shall enter into and perform its reasonable obligations
under an underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
underwriter of such offering;
(f) if required by the underwriter, or if any Investor is
described in the Registration Statement as an underwriter, the Company shall
furnish, on the effective date of the Registration Statement, on the date that
Registrable Securities or Additional Registrable Securities, as applicable, are
delivered to an underwriter, if any, for sale in connection with the
Registration Statement and at periodic intervals thereafter from time to time on
request, (i) an opinion, dated as of such date, from independent legal counsel
representing the Company for purposes of such Registration Statement, in form,
scope and substance as is customarily given in an underwritten public offering,
addressed to the underwriter and the Investors and (ii) a letter, dated such
date, from the Company's independent certified public accountants in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriter
and the Investors;
(g) make effort to prevent the issuance of any stop order or
other suspension of effectiveness and, if such order is issued, obtain the
withdrawal of any such order at the earliest possible moment;
(h) furnish to each Investor at least five copies of the
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules by air mail within two business days of the
effective date thereof;
(i) prior to any public offering of Registrable Securities
or Additional Registrable Securities, use its reasonable best efforts to
register or qualify or cooperate with the Investors and their counsel in
connection with the registration or qualification of such Registrable Securities
or Additional Registrable Securities, as applicable, for offer and sale under
the securities or blue sky laws of such jurisdictions requested by the Investor
and do any and all other reasonable acts or things necessary or advisable to
enable the distribution in such jurisdictions of the Registrable Securities or
Additional Registrable Securities covered by the Registration Statement;
(j) cause all Registrable Securities or Additional
Registrable Securities covered by a Registration Statement to be listed on each
securities exchange, interdealer quotation system or other market on which
similar securities issued by the Company are then listed;
(k) immediately notify the Investors, at any time when a
Prospectus relating to the Registrable Securities or Additional Registrable
Securities is required to be delivered under the Securities Act, upon discovery
that, or upon the happening of any event as a result of which, the Prospectus
included in such Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing, and at the request of any such holder,
promptly prepare and furnish to such holder a reasonable number of copies of a
supplement to or an amendment of such Prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities or
Additional Registrable Securities, as applicable, such Prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing; and
(l) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act,
take such other actions as may be reasonably necessary to facilitate the
registration of the Registrable Securities and Additional Registrable
Securities, if applicable, hereunder; and make available to its security
holders, as soon as reasonably practicable, but not later than the Availability
Date (as defined below), an earnings statement covering a period of at least
twelve months, beginning after the effective date of each Registration
Statement, which earnings statement shall satisfy the provisions of Section
11(a) of the 1933 Act (for the purpose of this subsection 3(l), "Availability
Date" means the 45th day following the end of the fourth fiscal quarter that
includes the effective date of such Registration Statement, except that, if such
fourth fiscal quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth fiscal
quarter).
4. DUE DILIGENCE REVIEW; INFORMATION. The Company shall make
available, during normal business hours, for inspection and review by the
Investors, advisors to and representatives of the Investors (who may or may not
be affiliated with the Investors and who are reasonably acceptable to the
Company), any underwriter participating in any disposition of Common Stock on
behalf of the Investors pursuant to the Registration Statement or amendments or
supplements thereto or any blue sky, NASD or other filing, all financial and
other records, all SEC Documents and other filings with the SEC, and all other
corporate documents and properties of the Company as may be reasonably necessary
for the purpose of such review, and cause the Company's officers, directors and
employees, within a reasonable time period, to supply all such information
reasonably requested by the Investors or any such representative, advisor or
underwriter in connection with such Registration Statement (including, without
limitation, in response to all questions and other inquiries reasonably made or
submitted by any of them), prior to and from time to time after the filing and
effectiveness of the Registration Statement for the sole purpose of enabling the
Investors and such representatives, advisors and underwriters and their
respective accountants and attorneys to conduct initial and ongoing due
diligence with respect to the Company and the accuracy of the Registration
Statement.
The Company shall not disclose material nonpublic information to the
Investors, or to advisors to or representatives of the Investors, unless prior
to disclosure of such information the Company identifies such information as
being material nonpublic information and provides the Investors, such advisors
and representatives with the opportunity to accept or refuse to accept such
material nonpublic information for review. The Company may, as a condition to
disclosing any material nonpublic information hereunder, require the Investors'
advisors and representatives to enter into a confidentiality agreement
(including an agreement with such advisors and representatives prohibiting them
from trading in Common Stock during such period of time as they are in
possession of material nonpublic information) in form reasonably satisfactory to
the Company and the Investors. Nothing herein shall require the Company to
disclose material nonpublic information to the Investors or their advisors or
representatives.
5. OBLIGATIONS OF THE INVESTORS.
(a) Each Investor shall furnish in writing to the Company
such information regarding itself, the Registrable Securities or Additional
Registrable Securities, as applicable, held by it and the intended method of
disposition of the Registrable Securities or Additional Registrable Securities,
as applicable, held by it, as shall be reasonably required to effect the
registration of such Registrable Securities or Additional Registrable
Securities, as applicable, and shall execute such documents in connection with
such registration as the Company may reasonably request. At least fifteen (15)
business days prior to the first anticipated filing date of any Registration
Statement, the Company shall notify each Investor of the information the Company
requires from such Investor if such Investor elects to have any of the
Registrable Securities or Additional Registrable Securities included in the
Registration Statement. An Investor shall provide such information to the
Company at least five (5) business days prior to the first anticipated filing
date of such Registration Statement if such Investor elects to have any of the
Registrable Securities or Additional Registrable Securities included in the
Registration Statement.
(b) Each Investor, by its acceptance of the Registrable
Securities and Additional Registrable Securities, if any, agrees to cooperate
with the Company as reasonably requested by the Company in connection with the
preparation and filing of a Registration Statement hereunder, unless such
Investor has notified the Company in writing of its election to exclude all of
its Registrable Securities or Additional Registrable Securities, as applicable,
from the Registration Statement.
(c) In the event the Company, at the request of the
Investors, determines to engage the services of an underwriter, such Investor
agrees to enter into and perform its obligations under an underwriting
agreement, in usual and customary form, including, without limitation, customary
indemnification and contribution obligations, with the managing underwriter of
such offering and take such other actions as are reasonably required in order to
expedite or facilitate the dispositions of the Registrable Securities or
Additional Registrable Securities, as applicable.
(d) Each Investor agrees that, upon receipt of any notice
from the Company of the happening of any event rendering a Registration
Statement no longer effective, such Investor will immediately discontinue
disposition of Registrable Securities or Additional Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities or
Additional Registrable Securities, until the Investor's receipt of the copies of
the supplemented or amended prospectus filed with the SEC and declared effective
and, if so directed by the Company, the Investor shall deliver to the Company
(at the expense of the Company) or destroy (and deliver to the Company a
certificate of destruction) all copies in the Investor's possession of the
prospectus covering the Registrable Securities or Additional Registrable
Securities, as applicable, current at the time of receipt of such notice.
(e) No Investor may participate in any third party
underwritten registration hereunder unless it (i) agrees to sell the Registrable
Securities or Additional Registrable Securities, as applicable, on the basis
provided in any underwriting arrangements in usual and customary form entered
into by the Company, (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements, and (iii) agrees to
pay its pro rata share of all underwriting discounts and commissions and any
expenses in excess of those payable by the Company pursuant to the terms of this
Agreement.
6. INDEMNIFICATION.
(a) INDEMNIFICATION BY COMPANY. The Company agrees to
indemnify and hold harmless, to the fullest extent permitted by law the
Investors, each of their officers, directors, partners and employees and each
person who controls the Investors (within the meaning of the 1933 Act) against
all losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorney's fees) and expenses imposed on such person caused by (i)
any untrue or alleged untrue statement of a material fact contained in any
Registration Statement, Prospectus or any preliminary prospectus or any
amendment or supplement thereto or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as the same are based upon any
information furnished in writing to the Company by such Investors, expressly for
use therein, or (ii) any violation by the Company of any federal, state or
common law, rule or regulation applicable to the Company in connection with any
Registration Statement, Prospectus or any preliminary prospectus, or any
amendment or supplement thereto, and shall reimburse in accordance with
subparagraph (c) below, each of the foregoing persons for any legal and any
other expenses reasonably incurred in connection with investigating or defending
any such claims. The foregoing is subject to the condition that, insofar as the
foregoing indemnities relate to any untrue statement, alleged untrue statement,
omission or alleged omission made in any preliminary prospectus or Prospectus
that is eliminated or remedied in any Prospectus or amendment or supplement
thereto, the above indemnity obligations of the Company shall not inure to the
benefit of any indemnified party if a copy of such corrected Prospectus or
amendment or supplement thereto had been made available to such indemnified
party and was not sent or given by such indemnified party at or prior to the
time such action was required of such indemnified party by the 1933 Act and if
delivery of such Prospectus or amendment or supplement thereto would have
eliminated (or been a sufficient defense to) any liability of such indemnified
party with respect to such statement or omission. Indemnity under this Section
5(a) shall remain in full force and effect regardless of any investigation made
by or on behalf of any indemnified party and shall survive the permitted
transfer of the Registrable Securities and Additional Registrable Securities.
(b) INDEMNIFICATION BY HOLDER. In connection with any
registration pursuant to the terms of this Agreement, each Investor will furnish
to the Company in writing such information as the Company reasonably requests
concerning the holders of Registrable Securities and Additional Registrable
Securities or the proposed manner of distribution for use in connection with any
Registration Statement or Prospectus and agrees, severally but not jointly, to
indemnify and hold harmless, to the fullest extent permitted by law, the
Company, its directors, officers, employees, stockholders and each person who
controls the Company (within the meaning of the 1933 Act) against any losses,
claims, damages, liabilities and expense (including reasonable attorney's fees)
resulting from any untrue statement of a material fact or any omission of a
material fact required to be stated in the Registration Statement or Prospectus
or preliminary prospectus or amendment or supplement thereto or necessary to
make the statements therein not misleading, to the extent, but only to the
extent that such untrue statement or omission is contained in any information
furnished in writing by such Investor to the Company specifically for inclusion
in such Registration Statement or Prospectus or amendment or supplement thereto
and that such information was substantially relied upon by the Company in
preparation of the Registration Statement or Prospectus or any amendment or
supplement thereto. In no event shall the liability of an Investor be greater in
amount than the dollar amount of the proceeds (net of all expense paid by such
Investor and the amount of any damages such holder has otherwise been required
to pay by reason of such untrue statement or omission) received by such Investor
upon the sale of the Registrable Securities or Additional Registrable Securities
included in the Registration Statement giving rise to such indemnification
obligation.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any person
entitled to indemnification hereunder shall (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim with
counsel reasonably satisfactory to the indemnified party; PROVIDED that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person unless (a)
the indemnifying party has agreed to pay such fees or expenses, or (b) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such person or (c) in the reasonable
judgment of any such person, based upon written advice of its counsel, a
conflict of interest exists between such person and the indemnifying party with
respect to such claims (in which case, if the person notifies the indemnifying
party in writing that such person elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such claim on behalf of such person); and
PROVIDED, FURTHER, that the failure of any indemnified party to give notice as
provided herein shall not relieve the indemnifying party of its obligations
hereunder, except to the extent that such failure to give notice shall
materially adversely affect the indemnifying party in the defense of any such
claim or litigation. It is understood that the indemnifying party shall not, in
connection with any proceeding in the same jurisdiction, be liable for fees or
expenses of more than one separate firm of attorneys at any time for all such
indemnified parties. No indemnifying party will, except with the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
that does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
in respect of such claim or litigation.
(d) CONTRIBUTION. If for any reason the indemnification
provided for in the preceding paragraphs (a) and (b) is unavailable to an
indemnified party or insufficient to hold it harmless, other than as expressly
specified therein, then the indemnifying party shall contribute to the amount
paid or payable by the indemnified party as a result of such loss, claim, damage
or liability in such proportion as is appropriate to reflect the relative fault
of the indemnified party and the indemnifying party, as well as any other
relevant equitable considerations. No person guilty of fraudulent
misrepresentation within the meaning of Section 11(f) of the 1933 Act shall be
entitled to contribution from any person not guilty of such fraudulent
misrepresentation. In no event shall the contribution obligation of a holder of
Registrable Securities or Additional Registrable Securities be greater in amount
than the dollar amount of the proceeds (net of all expenses paid by such holder
and the amount of any damages such holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission) received by it upon the sale of the Registrable Securities or
Additional Registrable Securities giving rise to such contribution obligation.
7. MISCELLANEOUS.
(a) AMENDMENTS AND WAIVERS. This Agreement may be amended
only by a writing signed by the parties hereto. The Company may take any action
herein prohibited, or omit to perform any act herein required to be performed by
it, only if the Company shall have obtained the written consent to such
amendment, action or omission to act, of each Investor.
(b) NOTICES. All notices and other communications provided
for or permitted hereunder shall be made as set forth in Section 9.4 of the
Purchase Agreement.
(c) ASSIGNMENTS AND TRANSFERS BY INVESTORS. This Agreement
and all the rights and obligations of the Investors hereunder may not be
assigned or transferred to any transferee or assignee except to an affiliate or
permitted transferee of an Investor who is a subsequent holder of any Warrants,
Registrable Securities or Additional Registrable Securities.
(d) ASSIGNMENTS AND TRANSFERS BY THE COMPANY. This Agreement
may not be assigned by the Company without the prior written consent of each
Investor, except that without the prior written consent of the Investors, but
after notice duly given, the Company shall assign its rights and delegate its
duties hereunder to any successor-in-interest corporation, and such
successor-in-interest shall assume such rights and duties, in the event of a
merger or consolidation of the Company with or into another corporation or the
sale of all or substantially all of the Company's assets.
(e) BENEFITS OF THE AGREEMENT. The terms and conditions of
this Agreement shall inure to the benefit of and be binding upon the respective
permitted successors and assigns of the parties. Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
(f) COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(g) TITLES AND SUBTITLES. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
(h) SEVERABILITY. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms to the fullest extent permitted by law.
(i) FURTHER ASSURANCES. The parties shall execute and
deliver all such further instruments and documents and take all such other
actions as may reasonably be required to carry out the transactions contemplated
hereby and to evidence the fulfillment of the agreements herein contained.
(j) ENTIRE AGREEMENT. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
(k) APPLICABLE LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to principles of conflicts of law.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
The Company: URSUS TELECOM COMMUNICATIONS
By: /s/ Luca M. Giussami
------------------------
Name: Luca M. Giussami
Title: Chief Executive Officer
The Investors:
By: /s/ Michael de Beaumont
------------------------
Name: Michael de Beaumont
Title: Director
By: /s/ Jason McCarroll
------------------------
Name: Jason McCarroll
Title: Director
By: /s/ Joan Thompson
------------------------
Name: Joan Thompson
Title: Director
RESONANCE LIMITED
By: /s/ M. Mandel
------------------------
Name: M. Mandel
Title: President
Exhibit 10.3
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
OR EXEMPTION FROM REGISTRATION UNDER THE FOREGOING LAWS.
VOID AFTER 5:00 P.M. EASTERN TIME ON FEBRUARY 10, 2005 ("EXPIRATION
DATE").
URSUS TELECOM CORPORATION
WARRANT TO PURCHASE _______ SHARES OF
COMMON STOCK, PAR VALUE $0.01 PER SHARE ("COMMON STOCK")
For VALUE RECEIVED, _________________ ("Warrantholder"), is
entitled to purchase, subject to the provisions of this Warrant, from Ursus
Telecom Corporation, a Florida corporation ("Company"), at any time not later
than 5:00 P.M., Eastern time, on the Expiration Date, at an exercise price per
share equal to $15.3956 (the exercise price in effect being herein called the
"Warrant Price"), _______ shares ("Warrant Shares") of Common Stock. The number
of Warrant Shares purchasable upon exercise of this Warrant and the Warrant
Price shall be subject to adjustment from time to time as described herein.
Section 1. REGISTRATION. The Company shall maintain books for the
transfer and registration of the Warrant. Upon the initial issuance of the
Warrant, the Company shall issue and register the Warrant in the name of the
Warrantholder.
Section 2. TRANSFERS. As provided herein, this Warrant may be
transferred only pursuant to a registration statement filed under the Securities
Act of 1933, as amended ("Securities Act") or an exemption from such
registration; provided, however, this Warrant may only be transferred to an
affiliate of the Warrantholder. Subject to such restrictions, the Company shall
transfer this Warrant from time to time upon the books to be maintained by the
Company for that purpose, upon surrender thereof for transfer properly endorsed
or accompanied by appropriate instructions for transfer and such other documents
as may be reasonably required by the Company to establish that such transfer is
being made in accordance with the terms hereof, and a new Warrant shall be
issued to the transferee and the surrendered Warrant shall be canceled by the
Company.
Section 3. EXERCISE OF WARRANT. Subject to the provisions hereof, the
Warrantholder may exercise this Warrant in whole or in part at any time upon
surrender of the Warrant, together with delivery of the duly executed Warrant
exercise form attached hereto (the "Exercise Agreement") and payment by cash,
certified check or wire transfer of funds for the Warrant Price for that number
of Warrant Shares then being purchased, to the Company during normal business
hours on any business day at the Company's principal executive offices (or such
other office or agency of the Company as it may designate by notice to the
holder hereof). The Warrant Shares so purchased shall be deemed to be issued to
the holder hereof or such holder's designee, as the record owner of such shares,
as of the close of business on the date on which this Warrant shall have been
surrendered (or evidence of loss, theft or destruction thereof and security or
indemnity satisfactory to the Company), the Warrant Price shall have been paid
and the completed Exercise Agreement shall have been delivered. Certificates for
the Warrant Shares so purchased, representing the aggregate number of shares
specified in the Exercise Agreement, shall be delivered to the holder hereof
within a reasonable time, not exceeding seven (7) business days, after this
Warrant shall have been so exercised. The certificates so delivered shall be in
such denominations as may be requested by the holder hereof and shall be
registered in the name of such holder or such other name as shall be designated
by such holder. If this Warrant shall have been exercised only in part, then,
unless this Warrant has expired, the Company shall, at its expense, at the time
of delivery of such certificates, deliver to the holder a new Warrant
representing the number of shares with respect to which this Warrant shall not
then have been exercised.
Each exercise hereof shall constitute the representation and warranty
of the Warrantholder to the Company that the representations and warranties
contained in Article 5 of the Purchase Agreement (as defined below) are true and
correct in all material respects with respect to the Warrantholder as of the
time of such exercise.
Section 4. COMPLIANCE WITH THE SECURITIES ACT OF 1933. Neither this
Warrant nor the Common Stock issued upon exercise hereof nor any other security
issued or issuable upon exercise of this Warrant may be offered, sold or
transferred except as provided in this agreement and in conformity with the
Securities Act, and then only against receipt of an agreement of such person to
whom such offer of sale is made to comply with the provisions of this Section 4
with respect to any resale or other disposition of such security. The Company
may cause the legend set forth on the first page of this Warrant to be set forth
on each Warrant or similar legend on any security issued or issuable upon
exercise of this Warrant, unless counsel for the Company is of the opinion as to
any such security that such legend is unnecessary.
Section 5. PAYMENT OF TAXES. The Company will pay any documentary
stamp taxes attributable to the initial issuance of Warrant Shares issuable upon
the exercise of the Warrant; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issuance or delivery of any certificates for Warrant Shares in a
name other than that of the registered holder of this Warrant in respect of
which such shares are issued, and in such case, the Company shall not be
required to issue or deliver any certificate for Warrant Shares or any Warrant
until the person requesting the same has paid to the Company the amount of such
tax or has established to the Company's satisfaction that such tax has been
paid. The holder shall be responsible for income taxes due under federal, state
or other law, if any such tax is due.
Section 6. MUTILATED OR MISSING WARRANTS. In case this Warrant shall
be mutilated, lost, stolen, or destroyed, the Company shall issue in exchange
and substitution of and upon cancellation of the mutilated Warrant, or in lieu
of and substitution for the Warrant lost, stolen or destroyed, a new Warrant of
like tenor and for the purchase of a like number of Warrant Shares, but only
upon receipt of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of the Warrant, and with respect to a lost, stolen or
destroyed Warrant, reasonable indemnity or bond with respect thereto, if
requested by the Company.
Section 7. RESERVATION OF COMMON STOCK. The Company hereby represents
and warrants that there have been reserved, and the Company shall at all
applicable times keep reserved until issued (if necessary) as contemplated by
this Section 7, out of the authorized and unissued Common Stock, sufficient
shares to provide for the exercise of the rights of purchase represented by the
Warrant. The Company agrees that all Warrant Shares issued upon exercise of the
Warrant shall be, at the time of delivery of the certificates for such Warrant
Shares, duly authorized, validly issued, fully paid and non-assessable shares of
Common Stock of the Company.
Section 8. ADJUSTMENTS. Subject and pursuant to the provisions of this
Section 8, the Warrant Price and number of Warrant Shares subject to this
Warrant shall be subject to adjustment from time to time as set forth
hereinafter.
(a) If the Company shall at any time or from time to time while
the Warrant is outstanding, pay a dividend or make a distribution on its Common
Stock in shares of Common Stock, subdivide its outstanding shares of Common
Stock into a greater number of shares or combine its outstanding shares into a
smaller number of shares or issue by reclassification of its outstanding shares
of Common Stock any shares of its capital stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing corporation), then the number of Warrant Shares
purchasable upon exercise of the Warrant and the Warrant Price in effect
immediately prior to the date upon which such change shall become effective,
shall be adjusted by the Company so that the Warrantholder thereafter exercising
the Warrant shall be entitled to receive the number of shares of Common Stock or
other capital stock which the Warrantholder would have received if the Warrant
had been exercised immediately prior to such event upon payment of a Warrant
Price that has been adjusted to reflect a fair allocation of the economics of
such event to the Warrantholder. Such adjustments shall be made successively
whenever any event listed above shall occur.
(b) If any capital reorganization, reclassification of the
capital stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor, or sale, transfer
or other disposition of all or substantially all of the Company's assets to
another corporation shall be effected, then, as a condition of such
reorganization, reclassification, consolidation, merger, sale, transfer or other
disposition, lawful and adequate provision shall be made whereby each
Warrantholder shall thereafter have the right to purchase and receive upon the
basis and upon the terms and conditions herein specified and in lieu of the
Warrant Shares immediately theretofore issuable upon exercise of the Warrant,
such shares of stock, securities or assets as would have been issuable or
payable with respect to or in exchange for a number of Warrant Shares equal to
the number of Warrant Shares immediately theretofore issuable upon exercise of
the Warrant, had such reorganization, reclassification, consolidation, merger,
sale, transfer or other disposition not taken place, and in any such case
appropriate provision shall be made with respect to the rights and interests of
each Warrantholder to the end that the provisions hereof (including, without
limitations, provision for adjustment of the Warrant Price) shall thereafter be
applicable, as nearly equivalent as may be practicable in relation to any shares
of stock, securities or properties thereafter deliverable upon the exercise
thereof. The Company shall not effect any such consolidation, merger, sale,
transfer or other disposition unless prior to or simultaneously with the
consummation thereof the successor corporation (if other than the Company)
resulting from such consolidation or merger, or the corporation purchasing or
otherwise acquiring such assets or other appropriate corporation or entity shall
assume the obligation to deliver to the holder of the Warrant such shares of
stock, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase and the other obligations under this
Warrant. The provisions of this paragraph (b) shall similarly apply to
successive reorganizations, reclassifications, consolidations, mergers, sales,
transfers or other dispositions.
(c) In case the Company shall fix a payment date for the making
of a distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of evidences of indebtedness or assets
(other than cash dividends or cash distributions payable out of consolidated
earnings or earned surplus or dividends or distributions referred to in Section
8(a)), or subscription rights or warrants, the Warrant Price to be in effect
after such payment date shall be determined by multiplying the Warrant Price in
effect immediately prior to such payment date by a fraction, the numerator of
which shall be the total number of shares of Common Stock outstanding multiplied
by the Market Price per share of Common Stock (as defined below), less the fair
market value (as determined by the Company's Board of Directors in good faith)
of said assets or evidences of indebtedness so distributed, or of such
subscription rights or warrants, and the denominator of which shall be the total
number of shares of Common Stock outstanding multiplied by such Market Price per
share of Common Stock. "Market Price" shall mean the average of the five lowest
closing bid prices of the Common Stock in the twenty-five (25) trading days
immediately preceding the date in question. Such adjustment shall be made
successively whenever such a payment date is fixed.
(d) For a period ending thirty (30) months after the original
issuance date of this Warrant, the Warrant Price shall be subject to adjustment
on a basis consistent with the provisions of Section 7.1(a) of the Purchase
Agreement by and between the Company and the Investors named therein dated
February 10, 2000 (the "Purchase Agreement") (regardless of whether the "MFN
Period" as therein defined has ended for purposes of adjustments of the Purchase
Price of the Shares), except that the Warrant Price shall be adjusted to a price
equal to 115% of the Market Price (as defined above) of the Common Stock on the
date of the event requiring such adjustment, if such adjustment to the Warrant
Price would result in a lower Warrant Price. Such adjustments shall be made
successively whenever required.
(e) An adjustment shall become effective immediately after the
payment date in the case of each dividend or distribution and immediately after
the effective date of each other event which requires an adjustment.
(f) In the event that, as a result of an adjustment made pursuant
to Section 8(a), the holder of this Warrant shall become entitled to receive any
shares of capital stock of the Company other than shares of Common Stock, the
number of such other shares so receivable upon exercise of this Warrant shall be
subject thereafter to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the Warrant
Shares contained in this Warrant.
Section 9. FRACTIONAL INTEREST. The Company shall not be required to
issue fractions of Warrant Shares upon the exercise of the Warrant. If any
fraction of a Warrant Share would, except for the provisions of this Section, be
issuable upon the exercise of the Warrant (or specified portions thereof), the
fractional share shall be disregarded and the number of shares to be issued upon
exercise shall be the number of whole shares only.
Section 10. BENEFITS. Nothing in this Warrant shall be construed to
give any person, firm or corporation (other than the Company and the
Warrantholder) any legal or equitable right, remedy or claim, it being agreed
that this Warrant shall be for the sole and exclusive benefit of the Company and
the Warrantholder.
Section 11. NOTICES TO WARRANTHOLDER. Upon the happening of any event
requiring an adjustment of the Warrant Price, the Company shall promptly give
written notice thereof to the Warrantholder at the address appearing in the
records of the Company, stating the adjusted Warrant Price and the adjusted
number of Warrant Shares resulting from such event and setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based. In the event of a dispute with respect to any such
calculation, the certificate of the Company's independent certified public
accountants shall be conclusive evidence of the correctness of any computation
made, absent manifest error. Failure to give such notice to the Warrantholder or
any defect therein shall not affect the legality or validity of the subject
adjustment.
Section 12. IDENTITY OF TRANSFER AGENT. The Transfer Agent for the
Common Stock is Continental Stock Transfer & Trust Company. Upon the appointment
of any subsequent transfer agent for the Common Stock or other shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrant, the Company will mail to the Warrantholder a
statement setting forth the name and address of such transfer agent.
Section 13. NOTICES. Any notice pursuant hereto to be given or made by
the Warrantholder to or on the Company shall be sufficiently given or made if
sent by certified mail, return receipt requested, postage prepaid, addressed as
follows:
Ursus Telecom Corporation
440 Sawgrass Corporate Parkway
Sunrise, FL 33325
Attn: Johannes Seefried
Chief Financial Officer
Fax: (954) 846-7884
or such other address as the Company may specify in writing by notice to the
Warrantholder complying as to delivery with the terms of this Section 13.
Any notice pursuant hereto to be given or made by the Company to or on
the Warrantholder shall be sufficiently given or made if personally delivered or
if sent by an internationally recognized courier services by overnight or
two-day service, to the address set forth on the books of the Company or, as to
each of the Company and the Warrantholder, at such other address as shall be
designated by such party by written notice to the other party complying as to
delivery with the terms of this Section 13. All such notices, requests, demands,
directions and other communications shall, when sent by courier be effective two
(2) days after delivery to such courier as provided and addressed as aforesaid.
Section 14. REGISTRATION RIGHTS. The initial holder of this Warrant is
entitled to the benefit of certain registration rights in respect of the Warrant
Shares as provided in the Registration Rights Agreement dated as of as of
February 10, 2000.
Section 15. SUCCESSORS. All the covenants and provisions hereof by or
for the benefit of the Warrantholder shall bind and inure to the benefit of its
respective successors and assigns hereunder.
Section 16. GOVERNING LAW. This Warrant shall be deemed to be a
contract made under the laws of the State of New York, without giving effect to
its conflict of law principles, and for all purposes shall be construed in
accordance with the laws of said State.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Warrant to be
duly executed, as of the day and year first above written.
URSUS TELECOM CORPORATION
By:
----------------------
Name:
Title:
<PAGE>
Ursus Telecom Corporation
WARRANT EXERCISE FORM
To: Ursus Telecom Corporation
This undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant ("Warrant") for, and to purchase
thereunder by the payment of the Warrant Price and surrender of the Warrant,
_______________ shares of Common Stock ("Warrant Shares") provided for therein,
and requests that certificates for the Warrant Shares be issued as follows:
-------------------------------
Name
--------------------------------
Address
--------------------------------
--------------------------------
Federal Tax ID or Social Security No.
and delivered by / / certified mail to the above address, or
/ / electronically (provide DWAC Instructions:_______), or
/ / other (specify: _________________________________).
and, if the number of Warrant Shares shall not be all the Warrant Shares
purchasable upon exercise of the Warrant, that a new Warrant for the balance of
the Warrant Shares purchasable upon exercise of this Warrant be registered in
the name of the undersigned Warrantholder or the undersigned's Assignee as below
indicated and delivered to the address stated below.
By exercising the rights represented by this Warrant, the undersigned
hereby certifies that, as of the date of exercise of this Warrant, the
representations and warranties contained in Section 5 of the Purchase Agreement
are true and correct in all material respects with respect to the undersigned.
Dated:___________________, ____
Note: The signature must correspond with Signature:______________________
the name of the registered holder as written
on the first page of the Warrant in every ______________________________
particular, without alteration or enlargement Name (please print)
or any change whatever, unless the Warrant
has been assigned. ______________________________
______________________________
Address
______________________________
Federal Identification or
Social Security No.
Assignee:
______________________________
______________________________
______________________________
Exhibit 99.1
COMPANY PRESS RELEASE
URSUS TELECOM CORPORATION RAISES $ 7 MILLION OF EQUITY FINANCING IN A PRIVATE
PLACEMENT LED BY THE TAIL WIND FUND, LTD. SUNRISE, Fla.--(BUSINESS WIRE)--Feb.
14, 2000--Ursus Telecom Corporation (Nasdaq: UTCC) announced today a private
equity financing of $7 million for shares of UTCC common stock. The funding was
led by the Tail Wind Fund, Ltd., a worldwide investor in emerging growth
companies.
The private placement consisted of 615,115 newly issued, unregistered shares of
Common Stock and a five-year warrant for 279,998 additional shares at a strike
price of $15.3956. As part of the placement agreement, Ursus Telecom will
register the new shares with the Securities and Exchange Commission. The Company
said the funds would be used for the marketing of its e-business unit
theSTREAM.com (www.theSTREAM.com), global expansion of its Internet telephony
operations and IP telephony network, as well as general working capital
purposes.
Commenting on the funding, Johannes Seefried, Chief Financial Officer of Ursus
Telecom Corporation, said, "We are delighted in having concluded this financing
at this very important time for the Company's ongoing development and growth
strategy in the internet telephony space, and are indeed very pleased to have
attracted institutional investors like the Tail Wind Fund. This funding will
strengthen our efforts to capitalize on the dramatic opportunity that we believe
exists in internet telephony and allow us to aggressively develop our IP network
and operations overseas as well as in the United States."
About Ursus Telecom
Ursus Telecom Corporation is a global facilities-based telecommunications
company that provides international services, including long distance,
direct-dial, value-added and Internet-based services to more than 100,000
customers - individuals, businesses and carriers - worldwide. The Company
operates directly and through a network of agents on five continents and over 45
countries that account for more than 80% of the World's international traffic.
Ursus Telecom operates switching facilities and points of presence in Sunrise,
Florida, Frankfurt, Lima, Buenos Aires, Johannesburg and Tokyo. Ursus Telecom is
the source of theSTREAM.com.
Together with theSTREAM.com as the Company's global marketing and provisioning
mechanism, Ursus believes it is well positioned to prosper in the next
generation of services which combine the Internet, telephony, fax, data and
video services into a single broadband platform offering a rich, multi-media
experience to its customers throughout the world.
Statements in this news release that relate to future plans, financial results
or projections, events or expected performance in future periods are
forward-looking statements and fall within the safe harbor provision of the
Private Securities Litigation Reform Act of 1995. While management wishes to
provide readers with reasonable opinions and viewpoints with respect to the
Company's progress, marketplace acceptance, business opportunities, and fiscal
performance, such statements, opinions and viewpoints are forward-looking and
involve risks and uncertainties, including risks of changing conditions in the
overall economy, the capital markets, the computer and telecommunications
industries, as well as risks of changing consumer demand and the success of the
Company's business strategies and other factors detailed in the Company's annual
and other reports filed with the Securities and Exchange Commission.
