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EXHIBIT 4.2
CONVERSION AGREEMENT
THIS CONVERSION AGREEMENT, dated as of March 29, 2000 (this
"AGREEMENT"), by and among General Magic, Inc., a Delaware corporation (the
"COMPANY"), and the undersigned holders of the Company's Series D Preferred
Stock and Series F Preferred Stock (each individually an "INVESTOR" and
collectively the "INVESTORS").
WITNESSETH:
WHEREAS, the Company and each Investor are parties to a Securities
Purchase Agreement, dated as of March 30, 1999 (the "SERIES D PURCHASE
AGREEMENT"), pursuant to which the Company issued to the respective Investor the
Company's Series D Preferred Stock (the "SERIES D PREFERRED SHARES"), and an
Exchange Agreement, dated as of September 9, 1999 (the "EXCHANGE AGREEMENT")
pursuant to which the Company issued to the respective Investor the Company's
Series F Preferred Stock (the "SERIES F PREFERRED SHARES");
WHEREAS, in connection with the Securities Purchase Agreement by and
among the Company and the Investors of even date herewith (the "SERIES H
PURCHASE AGREEMENT"), the Company has agreed, upon the terms and subject to the
conditions of the Series H Purchase Agreement, to issue and sell to the
Investors 2,200 shares of the Company's Series H Convertible Preferred Stock,
which will be convertible into shares of the Company's common stock (the "COMMON
STOCK") and warrants to purchase Common Stock;
WHEREAS, to induce the Company to execute and deliver the Series H
Purchase Agreement, Each Investor has agreed to convert the Preferred Shares as
provided herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and each
Investor hereby agree as follows:
1. Provided that the Closing (as defined in the Series H Purchase
Agreement) shall have occurred, each of the Investors agrees that on or prior to
the date which is 186 days after the Closing Date (as defined in the Series H
Purchase Agreement) (the "REQUIRED CONVERSION DATE"), such Investor shall have
delivered one or more conversion notices for the conversion of all of the Series
D Preferred Shares and Series F Preferred Shares held by such Investor as of the
date hereof, provided that: (a) each time that the Company delivers a Put Notice
during such 186 day period pursuant to the Common Stock Investment Agreement
dated as of July 30, 1999, as amended, between the Company and Cripple Creek
Securities, LLC, such date shall be extended for Halifax Fund, L.P., Palladin
Partners I., L.P., Palladin Overseas Fund, Limited, The Gleneagles Fund Company
and Lancer Securities, Ltd., as may be reasonably requested by Halifax Fund,
L.P. so that compliance with this conversion obligation will not force the
undersigned to become the beneficial owner of more than 4.99% of Company common
stock in the aggregate; and (b) such Investor shall not be required to deliver
any further conversion notices if at any time during such period the closing bid
price for Company Common Stock is less than $4.00.
2. Except as provided in the Series H Purchase Agreement, the
Series D Purchase Agreement and the Exchange Agreement shall remain in full
force and effect in accordance with their respective terms.
3. Miscellaneous.
(a) This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York without regard to the
principles of conflict of laws.
(b) If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.
(c) This Agreement may be executed in two or more identical
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once
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executed by a party, may be delivered to the other party hereto by facsimile
transmission of a copy of this Agreement bearing the signature of the party so
delivering this Agreement.
(d) Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
(e) The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
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IN WITNESS WHEREOF, the parties have caused this Conversion Agreement to
be duly executed as of day and year first above written.
COMPANY: BUYERS:
GENERAL MAGIC, INC. HFTP INVESTMENT L.L.C.
By: Promethean Asset Management
L.L.C.
Its: Investment Manager
By: _______________________
Name:
Its: By:
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Name: Xxxxx X. X'Xxxxx, Xx.
Its: Managing Member
RGC INTERNATIONAL INVESTORS,
LDC
By: Xxxx Xxxx Capital
Management, L.P.
Its: Investment Manager
By: RGC General Partner Corp.
Its: General Partner
By:
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Name: Xxxxx Xxxxx
Its: Managing Director
HALIFAX FUND, L.P.
By: The Palladin Group, L.P.
Its: Attorney-in-Fact
By:
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Name: Xxxxxx Xxxxxxx
Title: Managing Director
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[PAGE 2 OF 3 OF THE CONVERSION AGREEMENT SIGNATURE PAGES]
PALLADIN PARTNERS I, L.P.
By: Palladin Asset Management, L.L.C.
Its: General Partner
By:
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Name: Xxxxxx Xxxxxxx
Title: Managing Director
PALLADIN OVERSEAS FUND
LIMITED
By: The Palladin Group L.P.
Its: Attorney-in-Fact
By:
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Name: Xxxxxx Xxxxxxx
Title: Managing Director
THE GLENEAGLES FUND COMPANY
By: The Palladin Group L.P
Its: Attorney-in-Fact
By:
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Name: Xxxxxx Xxxxxxx
Title: Managing Director
LANCER SECURITIES LTD.
By: The Palladin Group L.P
Its: Attorney-in-Fact
By:
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Name: Xxxxxx Xxxxxxx
Title: Managing Director
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[PAGE 3 OF 3 OF THE CONVERSION AGREEMENT SIGNATURE PAGES]
XXXXXX CAPITAL LTD.
By:
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Name: Xxxxxx Xxxxxxx
Its: Authorized Signatory
XXXXXXX CAPITAL LTD.
By:
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Name: Xxxxxx Xxxxxxx
Its: Authorized Signatory
CONSECO DIRECT LIFE
By:
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Name:
Its: