APPLICATION SOFTWARE PURCHASE AGREEMENT
THIS AGREEMENT made as of the 6th day of May, 1997 (the "Effective
Date").
BETWEEN: 605285 ONTARIO INC., an Ontario corporation, having an office
in Etobicoke, Ontario ("Purchaser")
OF THE FIRST PART
AND
DATALINK SYSTEMS CORPORATION, a Nevada corporation, having an office in
San Jose, California (hereinafter referred to as "Systems")
OF THE SECOND PART
WHEREAS:
1. Systems is the beneficial owner of the Purchased Assets; and
2. Systems has agreed to sell and assign the Purchased Assets to
Purchaser and Purchaser has agreed to purchase the Purchased Assets on the
terms and conditions hereinafter set forth and contained.
NOW THEREFORE, THIS AGREEMENT WITNESSETH THAT in consideration of the
premises and mutual covenants herein contained, the parties hereto agree as
follows:
ARTICLE 1
INTERPRETATION
1.1 Definitions
In this Agreement, the recitals and the schedules, if any, the following
words, phrases and expressions shall have the following meanings:
a. "Application Software" means the computer programs consisting
of the modules and having the functional and technical specifications more
particularly described in Schedule A to this Agreement together with
Enhancements;
b. "Asset Valuation Report" means the Indication of Fair Market
Value report dated __________, 1997, prepared for Purchaser by Corporate
Valuation Services Limited effective as of the Valuation Date, as defined in
the Asset Valuation Report;
c. "Closing" has the meaning set out in Section 7.1;
d. "Closing Date" means May 6,1997, or such other date as the
parties may agree;
e. "Confidential Information" of a party (the "Disclosing
Party") shall mean information of a confidential and proprietary nature
relative to the Disclosing Party or its business and other matters deemed
confidential and proprietary by the Disclosing Party, written notice of which
is given to the party receiving such information (the "Receiving Party").
Notwithstanding the foregoing, "Confidential Information" of the Disclosing
Party shall not include:
i. written information not clearly marked as confidential
or oral disclosures not subsequently confirmed in writing as confidential;
ii. information which the Receiving Party can demonstrate
A. was published or generally known in the industry at
the time of its disclosure by the Disclosing Party, or became published or
generally known in the industry without breach of this Agreement by the
Receiving Party;
B. was known to the Receiving Party at the time of
disclosure by the Disclosing Party, independently of the Disclosing Party and
without breach of an obligation of confidentiality to the Disclosing Party;
C. is disclosed to the Receiving Party by a third
party which had a right to disclose such information and was not in breach of
an obligation of confidentiality to the Disclosing Party;
D. is independently developed by the Receiving Party
without use, directly or indirectly, of any Confidential Information of the
Disclosing Party; or
E. information required to be disclosed pursuant to
applicable law, regulation, judicial or administrative order, lawful subpoena
or enforceable discovery demand, provided the Receiving Party uses
commercially reasonable efforts to obtain confidential treatment of such
information.
f. "Customers" means any person using the Service;
g. "Documentation" has the meaning specified in Subsection v. of
the definition of Purchased Assets;
h. "Enhancement" means any improvement, revision or other
modification made to the Application Software by Vendor to be utilized with
the Service, including, without limitation, any improvement, revision or other
modification made by Vendor which is necessary:
i. to provide Customers with a then current Service;
ii. to keep the Service compatible with the personal
computer and networking technology then in use; and
iii. to maintain the Service as a state of the art or
industry leading technology,
including, without limitation, the changes set out in Appendix A.1
to Schedule A to the extent that Purchaser's Manager pursuant to the
Management Agreement continues to believe that they make sense in light of
then current market conditions and technical developments;
i. "Infringement Claims" has the meaning specified in Subsection
5.1.b.;
j. "Intellectual Property" has the meaning specified in
Subsection iv. of the definition of Purchased Asset";
k. "Letter of Representation" means a letter from Systems to
Corporate Valuation Services Limited in substantially the form attached as
Schedule B;
l. "Management Agreement" means the Management and Marketing
Agreement to be entered into by Purchaser and Systems on Closing for the
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management and marketing of the Purchased Assets;
m. "Note" means the 6.0% Secured Term Note, secured by the
Purchased Assets, in substantially the form attached as Schedule D;
n. "Originality Certificate" means the Officer's Certificate in
the form attached as Schedule C;
o. "Purchase Price" has the meaning specified in Section 2.1;
p. "Purchased Assets" means the Application Software and all of
Systems' property and rights necessary for the ownership of, operation of, or
the realization of benefits from, the Service, including, without limitation:
i. all products associated with or derivatives of the
Application Software utilized to provide the Service;
ii. the benefit of all agreements necessary for the
ownership of, operation of, or the realization of the benefit from, the
Service, including, without limitation, all service agreements and third party
license agreements;
iii. all inventions necessary for the ownership of,
operation of, or realization of the benefit from, the Service, including,
without limitation, ideas, research, discoveries, designs, systems, patterns,
specifications, technology, know-how, formulae, confidential information,
data, computer software development tools, operating systems, subroutines,
algorithms, methods and processes;
iv. all intellectual property rights necessary for the
ownership of, operation of, or realization of the benefit from, the Service,
including, without limitation, patents, trademarks, copyrights and trade
secrets and applications for and the right to apply for any intellectual
property, but excluding all trademark rights to the word QUOTEXPRESS subject
to Section ___, herein (the "Intellectual Property"); and
v. copies of all records, documents (including, without
limitation, user documentation and source code listings), correspondence,
notes and rights related to the foregoing ("Documentation");
q. "Purchase Price" has the meaning set out in Section 2.1;
r. "Section" means any section, subsection, article, clause,
subclause, paragraph or subparagraph of this Agreement;
s. "Security Agent Agreement" means the Security Agent Agreement
to be entered into by Systems, Purchaser and ▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇, as security
agent, on the Closing, for the purpose of holding the Purchased Assets
pursuant to the terms thereof;
t. "Service" means a service that provides for the delivery of
real time stock quotes utilizing the Application Software, wireless technology
and alphanumeric paging services, and commonly known as the "QUOTEXPRESS."
u. "Warrant" means the warrant entitling Purchaser to acquire
Two Hundred Thousand (200,000) shares of Common Stock of Systems, commencing
on the Effective Date and continuing until the third anniversary of the
Effective Date.
1.2 Interpretation
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a. The terms "this Agreement", " hereof", "hereunder" and
similar expressions refer to this Agreement and not to any particular Section,
Subsection or other portion of this Agreement and include any agreement
amending or supplementing this Agreement. Unless something in the subject
matter or context is inconsistent therewith, reference herein to Sections and
Subsections are to Sections and Subsections of this Agreement.
b. Except as specifically stated in this Agreement, all
references to currency are to Canadian dollars.
c. This Agreement shall be governed by and interpreted in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable therein, except the conflict of laws rules, and the parties attorn
to the jurisdiction of the courts of the Province of Ontario and the Federal
Courts of Canada. The parties expressly exclude the application of the Vienna
Convention for the International Sale of Goods.
d. Wherever the singular, plural, masculine, feminine or neuter
is used throughout this Agreement the same will be construed as meaning the
singular, plural, masculine, feminine, neuter, body politic or body corporate
where the fact or context so requires and the provisions hereof and all
covenants herein will be construed to be joint and several when applicable to
more than one party.
e. Headings are inserted in the Agreement for convenience of
reference only and are not intended to affect the Agreement's interpretation.
1.3 Schedules
The following schedules are incorporated into and made part of this
Agreement:
Schedule A - Application Software Specifications
Schedule B - Letter of Representation to Corporate
Valuation Services Limited
Schedule C - Originality Certificate
Schedule D - Form of Note
Schedule E - Exceptions to the representations and
warranties set out in Article 4, if any
Schedule F - Warrant
ARTICLE 2
AGREEMENT TO SELL, ASSIGN AND PURCHASE
2.1 Systems hereby sells, assigns and transfers all its right, title
and interest in the Purchased Assets to Purchaser and Purchaser hereby
purchases the entire right, title and interest of Systems therein, as of the
Effective Date, at and for $18,100,000 Canadian (the "Purchase Price") payable
in accordance with Article 3 hereof.
2.2 The parties agree that the fair market value of the Purchased
Assets is equal to the Purchase Price and agree that this determination is
final and conclusive between them.
2.3 Subject to the terms and conditions of this Agreement, Systems
shall grant to Purchaser, and Purchaser shall accept, the Warrant, entitling
Purchaser to acquire Two Hundred Thousand (200,000) shares of Common Stock of
Systems upon the terms and conditions set forth therein.
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2.4 Systems hereby grants Purchaser an option to acquire all right,
title and interest in, to and under the trademark "QUOTEXPRESS", together with
any good will of the business connected with the use of and symbolized by said
trademark, at an exercise price of Canadian Ten Dollars (Cdn. $10.00). The
option set forth herein shall become exercisable, if at all, in the event of
termination or expiration of the Marketing Agreement, provided that Purchaser
is not then in default thereof. This option shall terminate and be of no
further force and effect on the 180th day following termination or expiration
of the Marketing Agreement.
In the event of exercise of the option described herein and at
Purchaser's request, Systems will (i) promptly execute a written assignment of
title to Purchaser for the QUOTEXPRESS trademark and waive all moral rights
therein, (ii) assist Purchaser in every proper way (but at Purchaser's
expense) to obtain and from time to time enforce trademark and other rights
and protections relating to the QUOTEXPRESS trademark, and to that end, agrees
to execute all documents for use in applying for and obtaining trademark
registration, rights and protections, as Purchaser may desire, together with
any assignments thereof to Purchaser or persons designated by it. In the
event Purchaser is unable, after reasonable effort, to secure signatures on
any documents needed to apply for any trademark registration or other right or
protection relating to the QUOTEXPRESS invention, whether because of physical
or mental incapacity or for any other reason whatsoever, Systems hereby
irrevocably designates and appoints Purchaser and its duly authorized officers
and agents as his agent and attorney-in-fact, to act for and in its behalf and
stead, to execute and file any such application or applications and to do all
other lawfully permitted acts to further the issuance of trademark
registrations or similar protections thereon with the same legal force and
effect as if executed by it.
ARTICLE 3
PURCHASE PRICE AND PAYMENT
3.1 The Purchase Price will be payable partly in cash and partly by
execution and delivery of the Note for the balance of the Purchase Price as
follows:
a. $100,000 to be paid to the solicitors of the Purchaser and
credited against the purchase price on the Closing Date; and
b. $4,072,500 on Closing, by wire transfer; and
c. $14,027,500 by execution and delivery of the Note;
3.2 Purchaser will deduct and remit any withholding tax required to
be deducted and remitted in connection with any payment made under this
Section 3.1.
3.3 Purchaser will not be responsible for any taxes, levies or other
similar assessments including, without limitation, sales or use taxes payable
in connection with the purchase and sale contemplated by this Agreement, if
any.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES
4.1 Representations of Systems
Systems hereby, undertakes, represents and warrants to Purchaser at the
date hereof, at the Closing Date, and acknowledges that Purchaser is relying
on such undertakings, representations and warranties that:
a. Systems is a corporation (i) duly incorporated and organized,
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validly subsisting and in good standing under the laws of the jurisdiction of
its incorporation; (ii) duly authorized, with necessary and sufficient permits
and licenses to enable it to own its properties and to carry on its business
as presently owned and carried on by it; and (iii) having the power and
authority and right to enter into this Agreement and each and every agreement
and document to be executed and delivered by it pursuant hereto and to perform
each of its obligations as therein and herein contained;
b. neither execution nor delivery of this Agreement and each and
every other agreement executed and delivered by Systems pursuant hereto nor
the fulfillment or compliance with any of the terms hereof or thereof will
conflict with, or result in a breach of the terms, conditions or provisions
of, or constitute a default under, the articles and by-laws, as amended, of
Systems or any material agreement or instrument to which Systems is subject or
will require any consent or other action by any person or administrative or
governmental body;
c. Systems now has and on the Closing Date will have good and
marketable title, free and clear of any and all claims, liens, encumbrances,
mortgages, security interests and charges, licenses or rights of other persons
whatsoever to all of the Purchased Assets except as set out in Subsection 4.1
c. of Schedule E;
d. there are no agreements or contracts or other documents
pertaining to the acquisition or development of the Purchased Assets except as
set out in Subsection 4.1 d. of Schedule E, copies of which have been
delivered to Purchaser and its counsel;
e. the names of the individuals involved in the development of
the Application Software, the Purchased Assets or any element thereof, are set
out in Subsection 4.1.e. of Schedule E and all these individuals were:
i. employees of Systems or its predecessor in interest who
worked within the scope of their employment to develop the Application
Software, the Purchased Assets, or any element thereof, and who executed a
written waiver of their moral rights in the copyright to the foregoing in
favour of Systems;
ii. independent contractors or employees of independent
contractors which contractors were subject to agreements assigning their
interest, if any, in the Application Software, Purchased Assets, or any
element thereof to Systems or its predecessor in interest, and who executed a
written waiver of their moral rights in the copyright to the foregoing in
favour of Systems; a description of which agreements is set out in Subsection
4.1 d. of Schedule E and copies of which agreements have been delivered to
Purchaser and its counsel;
f. the Application Software does not contain any third party
software except as set out in Subsection 4.1 f. of Schedule E, and Systems has
licenses for such third party software which allow Systems to market such
software, directly or indirectly through sublicensees, as part of the
Application Software and those licenses which are assignable, will be assigned
to Purchaser on Closing, and with respect to those licenses which are not
assignable, Systems will procure new licenses in the name of Purchaser, or if
unavailable, Systems will procure new licenses in the name of Purchaser to
similar products and will modify the source code of the Application Software,
if necessary, to be compatible at its own cost and expense. None of the third
party software is custom software developed specifically for use with the
Application Software; or, if the third party software is so customized; the
license is assignable to the Purchaser, perpetual in term, and terminable only
for material breach following a reasonable cure period. All of the third
party software is readily
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available in the open market and capable of being obtained by the Purchaser in
the event a license terminates, or if the particular software is not capable
of being obtained at such time, other software suitable for substitution
therefor is readily available in the open market and Systems will modify, at
its own cost
and expense, the source code of the Application Software, if necessary, to be
compatible;
g. the Application Software, and any other aspect of the
Service, was not derived from any third party's pre-existing material except
as set out in Subsection 4.1 g. of Schedule E;
h. Systems has not used or enforced or failed to use or enforce
any Intellectual Property rights or other rights associated with the
Application Software or Purchased Assets in any manner which could adversely
affect the validity or enforceability of the Intellectual Property;
i. to the best of its knowledge there is not, and has not been,
any infringement or violation of Systems' rights in and to the Intellectual
Property;
j. Systems has not received notice of any claim of adverse
ownership, invalidity or other opposition to or conflict with the Purchased
Assets;
k. there are now no and at the Closing Date will be no action,
claim or demand or other proceedings pending or, to the best of its knowledge,
threatened against Systems before any court or administrative agency which
could materially adversely affect the financial condition or overall
operations of Systems or the Purchased Assets, and no judgment, order or
decree enforceable against Systems which does involve or may require the
expenditure of money as a condition to or a necessity for the right or ability
of Purchaser to conduct its business involving the Purchased Assets;
l. it has not entered into any agreement which would entitle any
person to any valid claim against Purchaser for a broker's commission,
finder's fee or any like payment in respect of the purchase and sale of the
Purchased Assets or any other matters contemplated by this Agreement;
m. the Application Software has been developed in accordance
with good professional standards applicable in the computer software industry
including, without limitation, using modern flexible programming languages and
development tools and writing computer code to allow the relevant Application
Software to run efficiently and ensure year 2000 complaint operation;
n. the Application Software operates in accordance with the
applicable associated user Documentation;
o. there are no licenses, agreements approvals or consents
required or advisable to enable Systems to lawfully and properly market the
Application Software and the Service in Canada and the United States and no
such licenses, agreements, approvals or consents will be required by
Purchaser;
p. it has not done anything so as to preclude Purchaser from
having full enjoyment and quiet possession of the Purchased Assets;
q. there are no outstanding options, agreements of purchase and
sale or other agreements or commitments obligating Systems to sell the
Purchased Assets or any of them, except pursuant to this Agreement;
r. there are no taxes, levies or other similar assessments
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including, without limitation, sales, use or other taxes payable by Systems in
connection with the purchase and sale contemplated by this Agreement;
s. the Application Software is available for use;
t. the Purchased Assets are not used in carrying on a business
in Canada;
u. the assumptions, referred to in the Asset Valuation Report,
are true and correct;
v. the Application Software is application software and is not
systems software as the terms "application software" and "systems software"
are generally used and understood in the computer industry; and
w. all copyright, patent or trademark registrations or
applications for registration of the Application Software in any jurisdiction
have been disclosed to the Purchaser, including complete and accurate
documentation relating thereto; if there are no such applications or
registrations, then Systems shall supply to the Purchaser, on closing, all
relevant or necessary information and documentation which will enable the
Purchaser to make such application for registration of patent, copyright or
trademark as Purchaser may determine.
All of the representations, warranties and covenants contained in this
Agreement made and to be made by Systems will survive the Closing Date and
continue in full force and effect for the benefit of Purchaser until the later
of (i) full payment of all amounts owing under the Note; and (ii) the third
anniversary of the Effective Date.
4.2 Representations and Warranties of Purchaser
Purchaser undertakes, represents and warrants to Systems at the date
hereof and at the Closing Date and acknowledges that Systems is relying on
such undertakings, representations and warranties that Purchaser is now and on
the Closing Date will be a corporation (i) duly incorporated and organized,
validly subsisting and in good standing under the laws of the jurisdiction of
its incorporation; (ii) duly authorized, with necessary and sufficient permits
and licenses to enable it to own its properties and to carry on its business
as presently owned and carried on by it; and (iii) having the corporate power
and authority and right to enter into this Agreement and each and every
agreement to be executed and delivered by Purchaser pursuant hereto and to
perform each of its obligations as therein and herein contained to purchase
the Purchased Assets in accordance with the terms of this Agreement.
The representations, warranties and covenants contained in this Agreement
and made and to be made by Purchaser will survive the Closing Date and
continue in full force and effect for the benefit of Systems while any money
due on the Note is outstanding.
ARTICLE 5
COVENANTS
5.1 Systems' Assumption of Liability and Indemnity
Systems hereby covenants and agrees to be liable to Purchaser for and to
indemnify and save harmless Purchaser from and against, effective as and from
the Closing Date, any claims, demands, actions, causes of action, damage,
loss, costs (including legal costs of a solicitor), liability or expense which
may be made
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or brought against Purchaser and which it may suffer or incur as a result of,
in respect of, or arising out of:
a. any non-fulfillment of or breach of any covenant,
undertaking, representation or warranty on the part of Systems, under this
Agreement or any document or instrument contemplated by this Agreement; and
b. subject to Section 5.3, infringement of any third party
rights to the Intellectual Property as a result of the use of the Intellectual
Property by Purchaser on or after the Closing Date ("Infringement Claims").
5.2 Purchaser's Assumption of Liability and Indemnity
Purchaser hereby covenants and agrees to be liable to Systems for and to
indemnify and save harmless Systems from and against, effective as and from
the Closing Date, any claims, demands, actions, causes of action, damage,
loss, costs (including legal costs of a solicitor), liability or expense which
may be made or brought against Systems and which it may suffer or incur as a
result of, in respect of, or arising out of any non-fulfillment of or breach
of any covenant, undertaking, representation or warranty on the part of
Purchaser under this Agreement or any document or instrument contemplated by
this Agreement.
5.3 Limitation on Indemnity for Infringement Claims
Systems' obligation to indemnify Purchaser, set out in subsection 5.1 b.
is subject to Purchaser providing Systems with prompt notice of any
Infringement Claims forthwith upon Purchaser receiving notice of such claims.
Purchaser may defend the claim, at its own expense. Systems, at its own
expense, also has the right to defend any Infringement Claim either by itself,
if Purchaser has elected not to do so, or jointly with Purchaser. Purchaser
will provide reasonable assistance to Systems with respect to the defense of
any Infringement Claim, at Systems' reasonable expense. Systems will provide
reasonable assistance to Purchaser with respect to the defense of any
Infringement Claim, at Purchaser's reasonable expense.
5.4 Other Covenants
Systems (and with respect to Section 5.4 d. only, Purchaser) covenants
and agrees as follows:
a. until the Closing Date, Systems will not sell, license or
otherwise dispose of any of the Purchased Assets or any part thereof or
interest therein, or agree to do so, or enter into any negotiations with a
view to any of the foregoing, without the prior approval of Purchaser;
b. Systems will make available to Purchaser for due diligence
investigations, all information, documents and agreements pertaining to the
development, acquisition and marketing of the Application Software and Service
including, without limitation, computer code and related documentation,
marketing and product business plans and the full cooperation of Systems
management;
c. Systems will complete the Certificate of Originality and
deliver it to Purchaser and Purchaser's counsel on or before Closing;
d. each Receiving Party that receives Confidential Information
from the Disclosing Party shall maintain such Confidential Information in
confidence, shall not reveal the same to any third party (other than its
employees on a need to know basis in connection with the Receiving Party's
performance under this Agreement or the Management Agreement) and shall not
use such Confidential
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Information, directly or indirectly, for any purpose other than as required in
the performance of this Agreement or the Management Agreement; and
e. Systems will acquire, at its expense and in Purchaser's name,
licenses for any third party software comprising part of the Purchased Assets
not assignable or assigned by Systems to Purchaser.
ARTICLE 6
CONDITIONS PRECEDENT
6.1 Conditions to Purchaser's Obligations
The obligations of Purchaser hereunder will be subject to the
satisfaction or compliance with, at or before Closing, of each of the
following conditions precedent (each of which is hereby acknowledged to be
included for the exclusive benefit of Purchaser and may be waived in writing
in whole or in part):
a. the execution and delivery of all of the closing deliveries
identified in Section 7.3;
b. all legal and regulatory approvals and consents, whether from
shareholders, governmental authorities or other third parties necessary to the
completion of the transactions contemplated by the terms of this Agreement
have been obtained;
c. there will have been no material adverse change, financial or
otherwise, in Systems or the Purchased Assets;
d. Systems will have performed or complied with, in all
respects, all of its undertakings, covenants and agreements hereunder to be
performed or complied with; and
e. the representations and warranties of Systems contained in
Section 4.1 will be true and correct on Closing.
6.2 Conditions to Systems' Obligations
The obligations of Systems hereunder will be subject to the satisfaction
or compliance with, at or before Closing, of each of the following conditions
precedent (each of which is hereby acknowledged to be included for the
exclusive benefit of Systems and may be waived in writing in whole or in
part):
a. delivery of the Purchase Price, and the execution and
delivery of all closing deliveries identified in Section 7.4;
b. Purchaser will have performed or complied with, in all
respects, all of its undertakings, covenants and agreements hereunder to be
performed or complied with; and
c. the representations and warranties of Purchaser contained in
Section 4.2 will be true and correct on Closing.
ARTICLE 7
CLOSING
7.1 Closing Date
The transaction of purchase and sale contemplated by this Agreement will
be completed at 3:00 P.M. on the Closing Date at the offices of Purchaser's
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Solicitors ("Closing").
7.2 Survival
This Agreement and its component parts will not merge upon Closing or on
execution, delivery or registration of any documents executed, delivered or
registered pursuant to this Agreement or otherwise, but will survive Closing.
Without limiting the generality of the foregoing, the parties hereto expressly
acknowledge and agree that the option to acquire the "QUOTEXPRESS" trademark
will survive the Closing and continue in full force.
7.3 Systems' Closing Deliveries
At the Closing, Systems will duly execute and deliver or cause to be
executed and delivered to Purchaser the following:
a. a ▇▇▇▇ of sale assigning the Purchased Assets to Purchaser;
b. the Management Agreement;
c. the Originality Certificate;
d. the Letter of Representation;
e. the Security Agent Agreement;
f. the Warrant;
g. copies of the Purchased Assets including, without limitation,
copies of all Documentation;
h. certified copies of resolutions of the directors of Systems
authorizing the transactions; and
i. such other agreements and documents as Purchaser may
reasonably request to give effect to the terms and conditions of this
Agreement.
j. originals of all authors' assignments of copyright, patent
and trademark and waivers of moral rights in the Application Software;
j. copies of all patent, trademark and copyright registrations
in respect of the Application Software; and
k. information sufficient to enable the Purchaser to apply for
and receive registration of copyright, patent or trademark in or relating to
the Application Software.
7.4 Purchaser's Closing Deliveries
At Closing Purchaser will execute and deliver or cause to be executed and
delivered the following:
a. wire transfer, bank draft or solicitor's trust cheque for the
cash amount of the Purchase Price payable on Closing pursuant to Section 3.1,
subject to any withholding tax payable in connection with such payment;
b. the Note;
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c. the Management Agreement;
d. the Security Agent Agreement;
e. any representations or other documentation reasonably
required by Systems in connection with the issuance of the Stock Certificate;
f. the Warrant;
g. a certified copy of a resolution of the directors of
Purchaser authorizing the transactions; and
h. such other agreements and documents as Systems may reasonably
request to give effect to the terms and conditions of this Agreement.
7.5 Delivery to Security Agent
At Closing and as security for its obligations under the Note, Purchaser
will electronically deliver to the Security Agent, under the Security Agent
Agreement, the source code for the Application Software delivered to Purchaser
by Systems.
ARTICLE 8
NOTICES
Every request, notice, statement, communication, ▇▇▇▇ or waiver provided
for in this Agreement shall be in writing and shall be directed to whom it is
to be given, made or delivered at such person's address for service as
specified in this Section and may be served:
a. personally, by delivering it to whom it is to be served
during that person's normal business hours. Any personally served notice
shall be deemed to be received by the addressee, for the purposes of this
Agreement, when actually delivered as aforesaid; or
b. by telecopy (or by any other like method by which a written
and recorded message may be sent) directed to whom it is to be given, unless
the sender is aware that the relevant receiving equipment is not functioning
properly. Any notice so served shall be received by the addressee, for the
purposes of this Agreement upon written acknowledgment of receipt of such
telecopy.
The addresses for service of notices hereunder of the following persons
shall be:
Systems: DataLink Systems Corporation
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▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Purchaser: 605285 Ontario Inc.
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▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇
Attention: Secretary-Treasurer
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Any of the foregoing may change their address for service in this Section
by notice given in accordance with this Section.
ARTICLE 9
MISCELLANEOUS
9.1 Severability
If any one or more of the provisions or parts thereof contained in this
Agreement should be or become invalid, illegal or unenforceable in any respect
in any jurisdiction, the remaining provisions or parts thereof contained
herein will be and will be conclusively deemed to be, as to such jurisdiction,
severable therefrom and:
a. the validity, legality or enforceability of such remaining
provisions or parts thereof will not in any way be affected or impaired by the
severance of the provisions or parts thereof severed; and
b. the invalidity, illegality or unenforceability of any
provision or part thereof contained in this Agreement in any jurisdiction will
not affect or impair such provision or part thereof or any other provisions of
this Agreement in any other jurisdiction.
9.2 Further Assurances
Each of the parties will, at any time and from time to time at the
request of the other, execute and deliver any and all such further instruments
or assurances as may be necessary or desirable to give effect to the terms and
conditions of this Agreement.
9.3 Counterpart and Facsimile Execution
This Agreement, and any and all ancillary documents contemplated herein,
may be executed in one or more counterparts and may be executed by facsimile
signatures and all such counterparts and facsimile signatures taken together
will constitute one and the same Agreement and will be binding on the parties
as if they had originally signed one copy of this Agreement.
9.4 Assignment
Purchaser may assign any part of its interest in this Agreement or the
Purchased Assets, except that any assignment to a competitor of Systems
requires the prior written consent of Systems. Such assignment shall be
effected by:
a. giving written notice of the name and address of the
assignee;
b. by delivering to Systems a written undertaking of the
assignees acknowledging receipt of a copy of this Agreement and agreeing to be
bound by the terms and conditions of this Agreement.
Systems may not assign this Agreement, without the prior written consent
of Purchaser, except that Systems may assign this Agreement in whole, but not
in part, and only with an assignment of all of its rights and obligations
under the Note and the Security Agent Agreement, to (I) any corporation,
partnership or other entity which is controlled by, controlling or under
common control with, Systems; or (ii) a purchaser of all or substantially all
the assets of Systems, or any person or entity into which systems is merged or
consolidated by:
a. giving written notice of the name and address of the
assignee;
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b. by delivering to Purchaser a written undertaking of the
assignees acknowledging receipt of a copy of this Agreement and agreeing to be
bound by the terms and conditions of this Agreement.
9.5 Binding Effect
This Agreement and all of its provisions will enure to the benefit of the
parties and their respective successors and assigns, and will be binding upon
the parties and their respective successors and assigns. The expressions
"Systems" and "Purchaser". as used herein will include Systems' and
Purchaser's assigns whether immediate or derivative, respectively.
9.6 Time of the Essence
Time will be of the essence of this Agreement.
9.7 Amendment
This Agreement may be altered or amended in any of its provisions when
any such changes are reduced to writing and signed by the parties hereto but
not otherwise.
9.8 Costs
Each party hereto will bear its own legal, accounting and other costs
relating to all matters involved in this transaction.
9.9 Confidentiality
Each of the parties will treat this Agreement and all information
relating to this Agreement and the transactions contemplated by this Agreement
confidentially and no public disclosure by any party will be made without the
prior approval of the other, not to be unreasonably withheld, except as
legally required by a party to satisfy disclosure obligations to shareholders
and regulators, in which case simultaneous notice of such disclosure will be
given to the other parties.
9.10 Entire Agreement
This Agreement, the Management Agreement, the Security Agent Agreement,
the Note and the exhibits and schedules referenced in each of the foregoing
constitute the entire Agreement among the parties and supersedes all
proposals, oral or written, and all other Systems among them relating to the
subject matter hereof.
IN WITNESS WHEREOF the Parties hereto have executed this Agreement on the
day first above written.
DATALINK SYSTEMS CORPORATION
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Chief Executive Officer
605285 ONTARIO INC.
By:/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Secretary-Treasurer
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