JATO COMMUNICATIONS CORP.
SERIES C PREFERRED STOCK
PURCHASE AGREEMENT
SEPTEMBER 16, 1999
JATO COMMUNICATIONS CORP.
SERIES C PREFERRED STOCK PURCHASE AGREEMENT
THIS SERIES C PREFERRED STOCK PURCHASE AGREEMENT (the "AGREEMENT") is
entered into as of this 16th day of September, 1999, by and among JATO
COMMUNICATIONS CORP., a Delaware corporation (the "COMPANY"), and each of those
persons and entities, severally and not jointly, whose names are set forth on
the Schedule of Purchasers attached hereto as EXHIBIT A (which persons and
entities are hereinafter collectively referred to as "PURCHASERS" and each
individually as a "PURCHASER").
RECITALS
WHEREAS, the Company has authorized the sale and issuance of up to an
aggregate of five million seven hundred fourteen thousand two hundred
eighty-five (5,714,285) shares of its Series C Preferred Stock, $.01 par value
(the "SHARES"); and
WHEREAS, the Company desires to issue and sell the Shares to the Purchasers
and the Purchasers severally desire to purchase some or all of the Shares from
the Company on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises hereinafter set forth, the parties hereto agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE
1.1 AUTHORIZATION OF SHARES. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized (i) the sale and issuance to
Purchasers of the Shares and (ii) the issuance of such shares of Common Stock to
be issued upon conversion of the Shares (the "CONVERSION SHARES"). The Shares
and the Conversion Shares shall have the rights, preferences, privileges and
restrictions set forth in the Restated Certificate of Incorporation of the
Company, in the form attached hereto as EXHIBIT B (the "CERTIFICATE").
1.2 SALE AND PURCHASE. Subject to the terms and conditions hereof, at the
Closing (as hereinafter defined), the Company hereby agrees to issue and sell to
each Purchaser, severally and not jointly, and each Purchaser agrees to purchase
from the Company, severally and not jointly, the number of Shares set forth
opposite such Purchaser's name on EXHIBIT A at a purchase price of $ 7.00 per
share.
SECTION 2. CLOSING, DELIVERY AND PAYMENT
2.1 CLOSING. The closing of the sale and purchase of the Shares under this
Agreement (the "CLOSING") shall take place on the date hereof, at the offices of
Xxxxxx Godward LLP, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000,
or at such other time or place as the Company and the Purchasers acquiring in
the aggregate more than half of the Shares may mutually agree (such date is
hereinafter referred to as the "CLOSING DATE").
1.
2.2 DELIVERY. At the Closing, subject to the terms and conditions hereof,
the Company will deliver to the Purchasers one or more stock certificates, as
each Purchaser may request, representing the number of Shares to be purchased at
the Closing by each Purchaser, registered in such Purchaser's name, against
payment of the purchase price therefor, by check or wire transfer made payable
to the order of the Company. In addition, TCI Satellite Entertainment, Inc.
shall deliver a promissory note to the Company, in the form previously approved
by the Company, in the amount of $3,000,000.00 (the "TCI NOTE") against payment
of the purchase price therefor of the number of Shares set forth opposite such
purchaser's name on EXHIBIT A hereto.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth on a Schedule of Exceptions delivered by the Company to
the Purchasers at the Closing, the Company hereby represents and warrants to
each Purchaser as of the date of this Agreement as follows:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company and each
Subsidiary (as defined in Section 3.2 below) is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
or, with respect to Jato Communications Corp. of Virginia, the Commonwealth of
Virginia. Each of the Company and Subsidiary has all requisite corporate power
and authority to own and operate their respective properties and assets. The
Company has all requisite corporate power and authority to execute and deliver
this Agreement, the Amended and Restated Investors' Rights Agreement, in the
form attached hereto as EXHIBIT C (the "INVESTORS' RIGHTS AGREEMENT"), and the
Amended and Restated Stockholders' Agreement, in the form attached hereto as
EXHIBIT D (the "STOCKHOLDERS' AGREEMENT"), issue and sell the Shares and the
Conversion Shares and to carry out the provisions of this Agreement, the
Investors' Rights Agreement, the Stockholders' Agreement and the Certificate.
Each of the Company and Subsidiary has the requisite corporate power and
authority to carry on its business as presently conducted and as presently
proposed to be conducted. Each of the Company and Subsidiary is duly qualified
and is authorized to do business and is in good standing as a foreign
corporation in all jurisdictions in which the nature of their respective
activities and of their respective properties (both owned and leased) make such
qualifications necessary, except for those jurisdictions in which failure to do
so would not have a material adverse effect on the Company or Subsidiary or
their respective businesses. The Company has made available to the Purchasers
true, correct and complete copies of the Company's Restated Certificate of
Incorporation and Amended Bylaws, each as amended to date and in full force and
effect on the date hereof. The Company has made available to the Purchasers
true, correct and complete copies of Subsidiary's Certificate of Incorporation
and Bylaws, each as amended to date and in full force and effect on the date
hereof. Since its inception, Subsidiary has had no operations and has not
incurred any material obligations.
3.2 SUBSIDIARIES. Other than Jato Operating Corp., a Delaware corporation,
Jato Operating Two Corp., a Delaware corporation, and Jato Communications Corp.
of Virginia, a Virginia corporation (collectively, the "SUBSIDIARY"), the
Company owns no equity securities of any other corporation, limited partnership
or similar entity. The Company is not a participant in any joint venture,
partnership or similar arrangement. The Company owns shares of the Subsidiary
free and clear of all encumbrances.
2.
3.3 CAPITALIZATION; VOTING RIGHTS.
(a) The authorized capital stock of the Company, immediately prior to
the Closing, will consist of (a) eighty million (80,000,000) shares of Common
Stock, of which six million seven hundred sixty-five thousand two (6,765,002)
shares are issued and outstanding, and (b) twenty-five million (25,000,000)
shares of Preferred Stock, of which one million seven hundred fifty-one thousand
nine hundred eighty-five (1,751,985) shares are designated Series A Preferred
Stock, of which one million seven hundred fifty-one thousand nine hundred eighty
five (1,751,985) are issued and outstanding, of which thirteen million six
hundred fifteen thousand three hundred twenty-two (13,615,322) shares are
designated Series B Preferred Stock, of which thirteen million six hundred
fifteen thousand three hundred twenty-two (13,615,322) are issued and
outstanding, and of which five million seven hundred fourteen thousand two
hundred eighty-five (5,714,285) shares are designated Series C Preferred Stock,
none of which are issued and outstanding. All issued and outstanding shares of
the Company's Common Stock and Preferred Stock (i) have been duly authorized and
validly issued, (ii) are fully paid and nonassessable and (iii) were issued in
compliance with all applicable state and federal laws concerning the issuance of
securities. The rights, preferences, privileges and restrictions of the Shares
are as stated in the Certificate. The Conversion Shares have been duly and
validly reserved for issuance. As of the Closing, there has been no action taken
by the Company which would have required an adjustment to the Series C
Conversion Price, as defined in the Certificate. Except as set forth on the
Schedule of Exceptions and except as may be granted pursuant to this Agreement
or the Investors' Rights Agreement, there are no outstanding options, warrants,
rights (including conversion or preemptive rights and rights of first refusal),
proxy or stockholder agreements, or agreements of any kind for the purchase or
acquisition from the Company of any of its securities. The Shares and the
Conversion Shares have been duly authorized and, when issued in compliance with
the provisions of this Agreement and the Certificate, will be validly issued
(including, without limitation, issued in compliance with applicable state and
federal securities laws), fully paid and nonassessable, subject to no preemptive
rights, and will be free of any liens or encumbrances; PROVIDED, HOWEVER, that
the Shares and the Conversion Shares may be subject to restrictions on transfer
under state and/or federal securities laws as set forth herein or as otherwise
required by such laws at the time transfer is proposed.
(b) The authorized capital stock of (i) Jato Operating Corp. consists
of eleven hundred (1,100) shares of Common Stock, (ii) Jato Operating Two Corp.
consists of one hundred (100) shares of Common Stock, and (iii) Jato
Communications Corp. of Virginia consists of one hundred (100) shares of Common
Stock, all of which shares are issued and outstanding and held of record by the
Company.
3.4 AUTHORIZATION; BINDING OBLIGATIONS. All corporate action on the part of
the Company, its officers, directors and stockholders necessary for the
authorization of this Agreement, the Investors' Rights Agreement and the
Stockholders' Agreement, the performance of all obligations of the Company
hereunder and thereunder at the Closing and the authorization, sale, issuance
and delivery of the Shares pursuant hereto and the Conversion Shares pursuant to
the Certificate has been taken or will be taken prior to the Closing. The
Agreement, the Investors' Rights Agreement and the Stockholders' Agreement, when
executed and delivered, will be valid and binding obligations of the Company
enforceable in accordance with their terms, except (i) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other
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laws of general application affecting enforcement of creditors' rights; (ii)
general principles of equity that restrict the availability of equitable
remedies; and (iii) to the extent that the enforceability of the indemnification
provisions in Section 3.12 of the Investors' Rights Agreement may be limited by
applicable laws. The sale of the Shares and the subsequent conversion of the
Shares into Conversion Shares are not and will not be subject to any preemptive
rights or rights of first refusal that have not been properly waived or complied
with.
3.5 FINANCIAL STATEMENTS. The Company has delivered to each Purchaser (i)
its audited balance sheet as at December 31, 1998 and audited statement of
income and cash flows for the period from inception and ending December 31, 1998
and (ii) its unaudited balance sheet as at June 30, 1999 (the "STATEMENT DATE")
and unaudited consolidated statement of income for the six-month period ending
on the Statement Date (collectively, the "FINANCIAL STATEMENTS"). The Financial
Statements, together with the notes thereto, are complete and correct in all
material respects, have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis throughout the periods
indicated, except as disclosed therein, and present fairly the financial
condition and position of the Company as of December 31, 1998 and the Statement
Date; PROVIDED, HOWEVER, that the unaudited financial statements are subject to
normal recurring year-end audit adjustments (which are not expected to be
material), and may not contain all footnotes required under generally accepted
accounting principles.
3.6 LIABILITIES. The Company has no material liabilities and, to its
knowledge, knows of no material contingent liabilities not otherwise disclosed
in the Financial Statements, except current liabilities incurred in the ordinary
course of business subsequent to the Statement Date which have not been, either
in any individual case or in the aggregate, materially adverse.
3.7 AGREEMENTS; ACTION.
(a) Except as set forth on the Schedule of Exceptions and except for
agreements explicitly contemplated hereby, there are no agreements,
understandings or proposed transactions between the Company and any of its
officers, directors, affiliates or their respective affiliates.
(b) There are no agreements, understandings, instruments, contracts,
proposed transactions, judgments, orders, writs or decrees to which the Company
is a party or to its knowledge by which it is bound which may involve (i)
obligations (contingent or otherwise) of, or payments to, the Company in excess
of $25,000, or (ii) the license of any patent, copyright, trade secret or other
proprietary right to or from the Company (other than licenses arising from the
purchase of "off the shelf" or other standard products), or (iii) provisions
restricting or affecting the development, manufacture or distribution of the
Company's products or services, or (iv) indemnification by the Company with
respect to infringements of proprietary rights.
(c) The Company has not (i) declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) incurred any indebtedness for money borrowed or any
other liabilities (other than with respect to indebtedness and other obligations
incurred in the ordinary course of business or as disclosed in the Financial
Statements) individually in excess of $25,000 or, in the case of indebtedness
and/or liabilities individually less than $25,000, in excess of $75,000 in the
aggregate, (iii) made any
4.
loans or advances to any person, other than ordinary advances for travel
expenses, or (iv) sold, exchanged or otherwise disposed of any of its assets or
rights, other than the sale of its inventory in the ordinary course of business.
(d) For the purposes of subsections (b) and (c) above, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including persons
or entities the Company has reason to believe are affiliated therewith) shall be
aggregated for the purpose of meeting the individual minimum dollar amounts of
such subsections.
3.8 OBLIGATIONS TO RELATED PARTIES. There are no obligations of the Company
to officers, directors, stockholders, or employees of the Company other than (a)
for payment of salary for services rendered, (b) reimbursement for reasonable
expenses incurred on behalf of the Company and (c) for other standard employee
benefits made generally available to all employees (including stock option
agreements outstanding under any stock option plan approved by the Board of
Directors of the Company). No such officer, director or stockholder, or any
member of their immediate families is, directly or indirectly, interested in any
material contract with the Company (other than such contracts as relate to any
such person's ownership of capital stock or other securities of the Company).
The Company is not a guarantor or indemnitor of any indebtedness of any other
person, firm or corporation.
3.9 ABSENCE OF CHANGES. Except as set forth on the Schedule of Exceptions,
since the Statement Date, there has not been:
(a) Any change in the assets, liabilities, financial condition,
earnings or operations of the Company from that reflected in the Financial
Statements, other than changes in the ordinary course of business, none of which
individually or in the aggregate has had or is expected to have a material
adverse effect on such assets, liabilities, financial condition, earnings or
operations of the Company;
(b) Any resignation or termination of any key officers of the Company;
and the Company, to the best of its knowledge, does not know of the impending
resignation or termination of employment of any such officer;
(c) Any material change in the contingent obligations of the Company by
way of guaranty, endorsement, indemnity, warranty or otherwise;
(d) Any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties, business or
prospects or financial condition of the Company;
(e) Any waiver by the Company of a valuable right or of a material debt
owed to it;
(f) Any direct or indirect loans made by the Company to any
stockholder, employee, officer or director of the Company, other than immaterial
advances made in the ordinary course of business;
5.
(g) Any material change in any compensation arrangement or agreement
with any employee, officer, director or stockholder including, without
limitation, any (i) increase in the compensation payable or to become payable by
the Company to any of the Company's employees, (ii) any bonus, incentive
compensation, service award or other like benefit, granted, made or accrued,
contingently or otherwise, to or for the credit of the Company's employees, or
(iii) any employee welfare, pension, retirement, profit-sharing or similar
payment or arrangement (whether or not subject to ERISA) made or agreed to by
the Company;
(h) Any declaration or payment of any dividend or other distribution of
the assets of the Company;
(i) Any labor organization activity;
(j) Any debt, obligation or liability incurred, assumed or guaranteed
by the Company, except those for immaterial amounts and for current liabilities
incurred in the ordinary course of business;
(k) Any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets;
(l) Any change in any material agreement to which the Company is a
party or by which it is bound which materially and adversely affects the
business, assets, liabilities, financial condition, operations or prospects of
the Company;
(m) (i) Any change in practice with respect to taxes, (ii) any making,
changing or revoking of any tax election, or (iii) any settlement or compromise
of any dispute involving a tax liability;
(n) Any change in the number of shares of capital stock of the Company
issued and outstanding;
(o) Any failure to conduct the business of the Company in the ordinary
course;
(p) Any change in the method of accounting or accounting practice of
the Company;
(q) Any change in the Company's lines of business; or
(r) Any other event or condition of any character that, either
individually or cumulatively, has materially and adversely affected the
business, assets, liabilities, financial condition, operations or prospects of
the Company. For purposes of this subsection (r), a material and adverse effect
shall only be deemed to occur if its monetary impact exceeds, or with the
passage of time, will exceed $75,000.
6.
3.10 REAL PROPERTIES; TANGIBLE PERSONAL PROPERTY.
(a) REAL PROPERTIES. The Schedule of Exceptions sets forth each lease
or other agreement (including easements) under which the Company leases or has
rights in any real property (the "REAL PROPERTY LEASES," and, each individually,
a "REAL PROPERTY LEASE"). The Company has a valid and subsisting leasehold
interest in all the real property which is the subject of each Real Property
Lease. The Company does not presently own, and has never owned, any real
property and does not presently operate, and has never operated, any real
property, other than as a lessee.
(b) TANGIBLE PERSONAL PROPERTY. Except as set forth on the Schedule of
Exceptions, (i) the Company has good, marketable and valid title to all of the
items of tangible personal property used in its operations and (ii) all such
tangible personal property is reflected on the Company's unaudited Financial
Statements, except as sold or disposed of subsequent to the date thereof in the
ordinary course of business consistent with past practices. The tangible
personal property of the Company is in good repair and working order, reasonable
wear and tear excepted, and constitutes all of the tangible personal property
necessary for the operation of the business as currently conducted.
3.11 PATENTS AND TRADEMARKS. The Company is the sole owner, free of any
lien or encumbrance, of, or has a valid license, on commercially reasonable
terms, to, all U.S. and foreign patents, registered designs, copyrights,
computer software and databases, trademarks, service marks and trade names,
whether or not registered, and other trade secrets, research and development,
formulae, inventions, processes, know-how and proprietary and intellectual
property rights and information, including all grants, registrations and
applications relating thereto (collectively, the "PROPRIETARY RIGHTS") necessary
for the conduct of its business as now conducted (the "COMPANY RIGHTS"). The
Company's rights in the Company Rights are, to the Company's knowledge, valid
and enforceable. The Company has received no demand, claim, notice or inquiry
from any person in respect of the Company Rights which challenges, threatens to
challenge or inquires as to whether there is any basis to challenge, the
validity of, or the rights of the Company in, any such Company Rights. There are
no outstanding options, licenses or agreements of any kind relating to the
Company Rights, nor is the Company bound by or a party to any options, licenses
or agreements of any kind with respect to the Proprietary Rights of any other
person or entity other than such licenses or agreements arising from the
purchase of "off the shelf" or standard products. The Company has taken, and
will take, all actions which are necessary in order to protect the Company
Rights and to acquire additional Proprietary Rights, consistent with prudent
commercial practices in the telecommunications industry. To the knowledge of the
Company, the Company is not in violation or infringement of, and has not
violated or infringed, any Proprietary Rights of any other person. To the
knowledge of the Company, no person is infringing any Company Rights. The
Company is not aware that any of its employees is obligated under any contract
(including licenses, covenants or commitments of any nature) or other agreement,
or subject to any judgment, decree or order of any court or administrative
agency, that would interfere with their duties to the Company's business by the
employees of the Company, nor will, to the Company's knowledge, the conduct of
the Company's business as proposed conflict with or result in a breach of the
terms, conditions or provisions of, or constitute a default under, any contract,
covenant or instrument under which any employee is now obligated. The Company
does not believe it is or will be necessary to
7.
utilize any inventions, trade secrets or proprietary information of any of its
employees made prior to their employment by the Company, except for inventions,
trade secrets or proprietary information that have been assigned to the Company.
3.12 COMPLIANCE WITH OTHER INSTRUMENTS. The Company is not in violation or
default of any term of its Certificate or Amended Bylaws, or of any provision of
any mortgage, indenture, contract, agreement, instrument or contract to which it
is party or by which it is bound or of any judgment, decree, order, writ or any
statute, rule or regulation applicable to the Company which would materially and
adversely affect the business, assets, liabilities, financial condition,
operations or prospects of the Company. The execution, delivery, and performance
of and compliance with this Agreement, the Investors' Rights Agreement, the
Stockholders' Agreement and the Compliance Certificate to be delivered pursuant
to Section 5.1(f) hereof, and the issuance and sale of the Shares pursuant
hereto and of the Conversion Shares pursuant to the Certificate, will not, with
or without the passage of time or giving of notice, result in any such material
violation, or be in conflict with or constitute a default under any such term,
or result in the creation of any mortgage, pledge, lien, encumbrance or charge
upon any of the properties or assets of the Company or the suspension,
revocation, impairment, forfeiture or nonrenewal of any permit, license,
authorization or approval applicable to the Company, its business or operations
or any of its assets or properties.
3.13 LITIGATION. There is no action, suit, proceeding or investigation
pending, or to the Company's knowledge, currently threatened against the Company
that questions the validity of this Agreement, the Investors' Rights Agreement
or the Stockholders' Agreement or the right of the Company to enter into any of
such agreements, or to consummate the transactions contemplated hereby or
thereby, or which might result, either individually or in the aggregate, in any
material adverse change in the assets, condition, affairs or prospects of the
Company, financially or otherwise, or any change in the current equity ownership
of the Company, nor is the Company aware that there is any basis for the
foregoing. The foregoing includes, without limitation, actions pending or
threatened (or any basis therefor known to the Company) involving the prior
employment of any of the Company's employees, their use in connection with the
Company's business of any information or techniques allegedly proprietary to any
of their former employers, or their obligations under any agreements with prior
employers. The Company is not a party or subject to the provisions of or in
violation of any order, writ, injunction, judgment or decree or any rule or
regulation of any court or government agency or instrumentality. There is no
action, suit, proceeding or investigation by the Company currently pending or
which the Company intends to initiate.
3.14 TAX RETURNS AND PAYMENTS. The Company has timely filed all tax returns
(federal, state and local) required to be filed by it. All taxes shown to be due
and payable on such returns, any assessments imposed, and to the Company's
knowledge all other taxes due and payable by the Company on or before the
Closing have been paid or will be paid prior to the time they become delinquent.
The Company has not been advised (i) that any of its returns, federal, state or
other, have been or are being audited as of the date hereof, or (ii) of any
deficiency in assessment or proposed judgment to its federal, state or other
taxes. The Company has no knowledge of any liability of any tax to be imposed
upon its properties or assets as of the date of this Agreement that is not
adequately provided for. Neither the Company nor the Subsidiary is a party to
any agreement relating to allocating or sharing the payment of, or liability for
taxes with
8.
respect to, any taxable period. Neither the Company nor Subsidiary
has any deferred income reportable for a period ending after the Closing Date
that is attributable to a transaction (e.g., an installment sale) occurring in,
or resulting from a change of accounting method for, a period ending on or prior
to the Closing Date.
3.15 EMPLOYEES. The Company is not a party to or bound by any currently
effective employment contract, deferred compensation arrangement, bonus plan,
incentive plan, profit sharing plan, retirement agreement or other employee
compensation plan or agreement. Neither the Company, nor any entity which is
required to be aggregated with the Company pursuant to Sections 414(b), (c), (m)
or (o) of the Internal Revenue Code of 1986 has any liability whether actual or
contingent, with respect to any employee benefit plan or arrangement. To the
Company's knowledge, no employee of the Company, nor any consultant with whom
the Company has contracted, is in violation of any term of any employment
contract, proprietary information agreement or any other agreement relating to
the right of any such individual to be employed by, or to contract with, the
Company because of the nature of the business to be conducted by the Company;
and to the Company's knowledge the continued employment by the Company of its
present employees, and the performance of the Company's contracts with its
independent contractors, will not result in any such violation. The Company has
not received any notice alleging that any such violation has occurred. No
employee of the Company has been granted the right to continued employment by
the Company or to any material compensation following termination of employment
with the Company. The Company is not aware that any officer or key employee, or
that any group of key employees, intends to terminate their employment with the
Company, nor does the Company have a present intention to terminate the
employment of any officer, key employee or group of key employees. To the
Company's knowledge, the Company is in compliance with all laws and orders
relating to the employment of labor, including, without limitation, all such
laws and orders relating to wages, hours, discrimination, civil rights, safety
and the collection and payment of withholding and/or Social Security taxes and
similar taxes. There are no complaints, charges or claims against the Company
pending, or, to the Company's knowledge, threatened to be brought or filed, with
any governmental entity or arbitrator based on, arising out of, in connection
with, or otherwise relating to the employment or termination of employment of
any individual by the Company.
3.16 PROPRIETARY INFORMATION AND INVENTIONS AGREEMENTS. Each current
employee, officer and consultant of the Company has executed a Proprietary
Information and Inventions Agreement that effectively waives any ownership
rights in the invention or authorship of any Company Rights and has assigned to
the Company all rights with respect thereto. No current employee, officer or
consultant of the Company has excluded works or inventions made prior to his or
her employment with the Company from his or her assignment of the works or
inventions pursuant to such employee, officer or consultant's Non-Competition,
Proprietary Information and Inventions Agreement in the form attached hereto as
EXHIBIT E.
3.17 OBLIGATIONS OF MANAGEMENT. Each officer of the Company is currently
devoting one hundred percent (100%) of his business time to the conduct of the
business of the Company. The Company is not aware of any officer or key employee
of the Company planning to work less than full time at the Company in the
future.
9.
3.18 REGISTRATION RIGHTS. Except as required pursuant to the Investors'
Rights Agreement, the Company is presently not under any obligation, and has not
granted any rights, to register (as defined in Section 1 of the Investors'
Rights Agreement) any of the Company's presently outstanding securities or any
of its securities that may hereafter be issued.
3.19 COMPLIANCE WITH LAWS; PERMITS. The Company is not in violation of any
applicable statute, rule, regulation, order or restriction of any domestic or
foreign government or any instrumentality or agency thereof in respect of the
conduct of its business or the ownership of its properties which violation would
materially and adversely affect the business, assets, liabilities, financial
condition, operations or prospects of the Company. No governmental orders,
permissions, consents, approvals or authorizations are required to be obtained
and no registrations or declarations are required to be filed in connection with
the execution and delivery of this Agreement and the issuance of the Shares or
the Conversion Shares, except such as has been duly and validly obtained or
filed, or with respect to any filings that must be made after the Closing, as
will be filed in a timely manner. The Schedule of Exceptions sets forth the
states in which the Company has obtained all franchises, permits, licenses and
any similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, properties, prospects or financial condition of the Company.
3.20 OFFERING VALID. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.2 hereof, the offer, sale
and issuance of the Shares and the Conversion Shares will be exempt from the
registration requirements of the Securities Act of 1933, as amended (the
"SECURITIES ACT"), and will have been registered or qualified (or are exempt
from registration and qualification) under the registration, permit or
qualification requirements of all applicable state securities laws. Neither the
Company nor any agent on its behalf has solicited or will solicit any offers to
sell or has offered to sell or will offer to sell all or any part of the Shares
to any person or persons so as to bring the sale of such Shares by the Company
within the registration provisions of the Securities Act or any state securities
laws.
3.21 FULL DISCLOSURE. This Agreement, the Exhibits hereto, the Schedule of
Exceptions, the Investors' Rights Agreement, the Stockholders' Agreement and all
other documents delivered by the Company to Purchasers or their attorneys or
agents in connection herewith or therewith or with the transactions contemplated
hereby or thereby, do not contain any untrue statement of a material fact nor
omit to state a material fact necessary in order to make the statements
contained herein or therein not misleading. There is no fact peculiar to the
Company and known to the Company which materially adversely affects, or
reasonably could be expected to materially adversely affect in the future, the
business, property or assets, or financial condition of the Company, which has
not been set forth in this Agreement or in the other documents described herein
or furnished to the Purchasers by or on behalf of the Company prior to the date
hereof in connection with the transactions contemplated hereby.
3.22 APPLICATION OF PROCEEDS. The proceeds of the sale of the Shares will
be used by the Company to fund the capital expenditures and working capital
needs of the Company and for other general corporate purposes. The Company does
not own any "margin security' within the meaning of Regulation T (12 CFR Part
220) of the Board of Governors of the Federal Reserve System (herein called a
"margin security") or "margin stock" within the meaning of Regulation
10.
U (12 CFR Part 221) of the Board of Governors of the Federal Reserve System
(herein called "margin stock"). Neither the Company nor any agent acting on its
behalf, has taken or will take any action which might cause this Agreement to
violate Regulation T, Regulation U, Regulation X or any other regulation of the
Board of Governors of the Federal Reserve System or to violate the Securities
Exchange Act of 1934, in each case as in effect now or as the same hereafter may
be in effect.
3.23 CERTAIN LIMITATIONS. Neither the nature of the Company, nor any of its
respective businesses or properties, nor any relationship between the Company
and any other person, nor any circumstance in connection with the offer, issue,
sale or delivery of the Shares (other than in any such case, any matter relating
to the Purchasers) is, such as to require or give rise to any limitation on any
Purchaser's ownership of any equity securities of the Company.
3.24 ENVIRONMENTAL.
(a) To the Company's knowledge, the Company complies, and at all times
has complied, in all material respects with all applicable Environmental Laws.
For the purposes hereof, "ENVIRONMENTAL LAW" shall mean any judgment, decree,
order, law, permit, license, rule, regulation or agency requirement relating to
or addressing the environment, health or safety (to the extent relating to
exposure to any hazardous substance), including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, as
amended, the Resource Conservation and Recovery Act, as amended, the Superfund
Amendments and Reauthorization Act of 1986, the Federal Clean Water Act, the
Federal Clean Air Act, the Toxic Substances Control Act and any federal, state,
local or foreign statute, regulation, ordinance, order or decree relating to
health, safety (in the case of health and safety to the extent relating to
exposure in the workplace or otherwise to any Hazardous Substance) or the
environment.
(b) There is not now pending or, to the Company's knowledge, threatened
any action, claim, proceeding or investigation nor has the Company received any
notice, claim, demand letter, or request for information at any time, alleging
that the Company may be in violation of, or liable under, any Environmental Law.
(c) To the Company's knowledge, without initiating any inquiry, there
are no hazardous substances located on the properties currently or formerly
owned or operated by the Company (including soil, groundwater or surface
features and buildings or structures thereon) other than as permitted under
applicable Environmental Laws, and none of the properties contain, or has
contained, any underground storage tank.
3.25 INSURANCE. The Company maintains and/or is covered by valid policies
of workers' compensation insurance and of insurance with respect to its
properties and business. The Company currently maintains, in full force,
insurance covering the risks of the Company, if any, of such types and in such
amounts and with such deductibles as are customary for other companies engaged
in similar lines of business and with good and responsible insurance companies.
3.26 SMALL BUSINESS MATTERS. The Company acknowledges that ABN AMRO Private
Equity is a federally licensed Small Business Investment Company (an "SBIC
HOLDER") under
11.
the Small Business Investment Company Act. The information regarding the Company
and its affiliates in Small Business Administration Form 480, Form 652 and Parts
A and B of Form 1031 delivered at or promptly following the Closing is accurate
in all material respects. Neither the Company nor any subsidiary of the Company
presently engages in, or shall hereinafter engage in, any activities, nor shall
the Company nor any subsidiary of the Company use the proceeds from the sale of
Series C Stock directly or indirectly for any purpose for which an SBIC Holder
is prohibited from providing funds by Small Business Investment Company Act
regulations.
3.27 QUALIFIED SMALL BUSINESS. The Company represents and warrants to the
Purchasers that, to the best of its knowledge, the Company is a "qualified small
business" within the meaning of Section 1202(d) of the Internal Revenue Code of
1986, as amended (the "Code") as of the date hereof and the Shares should
qualify as "qualified small business stock" as defined in Section 1202(c) of the
Code as of the date hereof. The Company further represents and warrants that, as
of the date hereof, it meets the "active business requirement" of Section
1202(e) of the Code, and it has made no "significant redemptions" within the
meaning of Section 1202(c)(3)(B) of the Code.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company as follows
(such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 REQUISITE POWER AND AUTHORITY. Purchaser has all necessary power and
authority under all applicable provisions of law to execute and deliver this
Agreement, the Investors' Rights Agreement, the Stockholders' Agreement and to
carry out their provisions. All action on Purchaser's part required for the
lawful execution and delivery of this Agreement, the Investors' Rights Agreement
and the Stockholders' Agreement has been or will be effectively taken prior to
the Closing. Upon their execution and delivery, this Agreement, the Investors'
Rights Agreement and the Stockholders' Agreement will be valid and binding
obligations of Purchaser, enforceable in accordance with their terms, except (i)
as limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws of general application affecting enforcement of creditors' rights,
(ii) general principles of equity that restrict the availability of equitable
remedies and (iii) to the extent that the enforceability of the indemnification
provisions of the Investors' Rights Agreement may be limited by applicable laws.
4.2 INVESTMENT REPRESENTATIONS. Purchaser understands that neither the
Shares nor the Conversion Shares have been registered under the Securities Act.
Purchaser also understands that the Shares are being offered and sold pursuant
to an exemption from registration contained in the Securities Act based in part
upon Purchaser's representations contained in the Agreement. Purchaser hereby
represents and warrants as follows:
(a) PURCHASER BEARS ECONOMIC RISK. Purchaser has substantial experience
in evaluating and investing in private placement transactions of securities in
companies similar to the Company so that it is capable of evaluating the merits
and risks of its investment in the
12.
Company and has the capacity to protect its own interests. Purchaser must bear
the economic risk of this investment indefinitely unless the Shares (or the
Conversion Shares) are registered pursuant to the Securities Act, or an
exemption from registration is available. Purchaser also understands that there
is no assurance that any exemption from registration under the Securities Act
will be available and that, even if available, such exemption may not allow
Purchaser to transfer all or any portion of the Shares or the Conversion Shares
under the circumstances, in the amounts or at the times Purchaser might propose.
(b) ACQUISITION FOR OWN ACCOUNT. Purchaser is acquiring the Shares and
the Conversion Shares for Purchaser's own account for investment only, and not
with a view towards their distribution.
(c) ACCREDITED INVESTOR. Purchaser represents that it is an "accredited
investor" within the meaning of Regulation D under the Securities Act.
(d) RULE 144. Purchaser acknowledges and agrees that the Shares, and,
if issued, the Conversion Shares must be held indefinitely unless they are
subsequently registered under the Securities Act or an exemption from such
registration is available. Purchaser has been advised or is aware of the
provisions of Rule 144 promulgated under the Securities Act as in effect from
time to time, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things, the availability of certain current public information about the
Company, the resale occurring following the required holding period under Rule
144 and the number of shares being sold during any three-month period not
exceeding specified limitations.
(e) RESIDENCE. If the Purchaser is an individual, then the Purchaser
resides in the state or province identified in the address of the Purchaser set
forth on EXHIBIT A; if the Purchaser is a partnership, corporation, limited
liability company or other entity, then the office or offices of the Purchaser
in which its investment decision was made is located at the address or addresses
of the Purchaser set forth on EXHIBIT A.
4.3 TRANSFER RESTRICTIONS. Each Purchaser acknowledges and agrees that the
Shares and, if issued, the Conversion Shares are subject to restrictions on
transfer as set forth in the Investors' Rights Agreement and the Stockholders'
Agreement.
SECTION 5. CONDITIONS TO CLOSING
5.1 CONDITIONS TO PURCHASERS' OBLIGATIONS AT THE CLOSING. Purchasers'
obligations to purchase the Shares at the Closing are subject to the
satisfaction, at or prior to the Closing, of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF OBLIGATIONS.
The representations and warranties made by the Company in Section 3 hereof shall
be true and correct in all respects as of the Closing Date with the same force
and effect as if they had been made as of the Closing Date, and the Company
shall have performed all obligations and conditions herein required to be
performed or observed by it on or prior to the Closing.
13.
(b) LEGAL INVESTMENT. On the Closing Date, the sale and issuance of the
Shares and the proposed issuance of the Conversion Shares shall be legally
permitted by all laws and regulations to which Purchasers and the Company are
subject.
(c) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained any
and all consents, permits and waivers necessary or appropriate for consummation
of the transactions contemplated by the Agreement, the Investors' Rights
Agreement and the Stockholders' Agreement (except for such as may be properly
obtained subsequent to the Closing).
(d) FILING OF CERTIFICATE. The Certificate shall have been approved by
the Board of Directors of the Company and filed with the Secretary of State of
the State of Delaware and shall be in full force and effect.
(e) RESERVATION OF CONVERSION SHARES. The Conversion Shares issuable
upon conversion of the Shares shall have been duly authorized and reserved for
issuance upon such conversion.
(f) COMPLIANCE CERTIFICATE. The Company shall have delivered to
Purchasers a Compliance Certificate, executed by the Chief Executive Officer of
the Company, dated as of the Closing Date, to the effect that the conditions
specified in subsections (a), (c), (d) and (e) of this Section 5.1 have been
satisfied.
(g) AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT. An Amended and
Restated Investors' Rights Agreement, substantially in the form attached hereto
as EXHIBIT C, shall have been executed and delivered by the parties thereto.
(h) AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT. An Amended and
Restated Stockholders' Agreement, substantially in the form attached hereto as
EXHIBIT D, shall have been executed and delivered by the parties thereto.
(i) BOARD OF DIRECTORS. Upon the Closing, the authorized size of the
Board of Directors of the Company shall be six (6) members and the Board shall
consist of Xxxxxxx Xxxxxx, Xxxxx Xxxx, Xxxxx Xxxxxxxxxxx, Xxxxx Xxxxxx, Xxxxxx
X. Xxxxxxxx, and Xxxx Xxxxxx.
(j) LEGAL OPINION. The Purchasers shall have received from Xxxxxx
Godward LLP an opinion addressed to them, dated as of the Closing Date, in
substantially the form attached hereto as EXHIBIT F.
(k) MINIMUM AMOUNT OF INVESTMENT. A minimum of three million five
hundred seventy-one thousand four hundred twenty-eight (3,571,428) shares of the
Company's Shares shall be sold at the Closing.
(l) PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at the Closing hereby, all
documents and instruments incident to such transactions and all documents,
instruments and proceedings related to the Purchasers' business, technical and
legal due diligence shall be reasonably satisfactory in substance and form to
the Purchasers and their special counsel, and the Purchasers and their
14.
special counsel shall have received all such counterpart originals or certified
or other copies of such documents as they may reasonably request.
(m) EXPENSES. On the Closing Date, the Company shall have paid the
reasonable fees and expenses of Xxxxx Xxxxxxxxxx LLP as special counsel for the
Purchasers, in an amount not to exceed $15,000.
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation to
issue and sell the Shares at the Closing is subject to the satisfaction, on or
prior to the Closing, of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all respects at the date of the Closing, with the same force and effect as if
they had been made on and as of said date.
(b) PERFORMANCE OF OBLIGATIONS. Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchasers on or before the Closing.
(c) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained any
and all consents, permits and waivers necessary or appropriate for consummation
of the transactions contemplated by the Agreement, the Investors' Rights
Agreement and the Stockholders' Agreement (except for such as may be properly
obtained subsequent to the Closing).
(d) FILING OF CERTIFICATE. The Certificate shall have been approved by
the Board of Directors of the Company and filed with the Secretary of State of
the State of Delaware and shall be in full force and effect.
(e) AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT. An Amended and
Restated Investors' Rights Agreement, substantially in the form attached hereto
as EXHIBIT C, shall have been executed and delivered by the Purchasers.
(f) AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT. An Amended and
Restated Stockholders' Agreement, substantially in the form attached hereto as
EXHIBIT D, shall have been executed and delivered by Purchasers.
(g) MINIMUM AMOUNT OF INVESTMENT. A minimum of three million five
hundred seventy-one thousand four hundred twenty-eight (3,571,428) shares of the
Company's Shares shall be sold at the Closing.
SECTION 6. MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be construed and enforced in
accordance with the laws of the State of Colorado without regard to its
conflict-of-laws rules.
15.
6.2 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
6.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto
and shall inure to the benefit of and be enforceable by each person who shall be
a holder of the Shares from time to time.
6.4 ENTIRE AGREEMENT. This Agreement, the Exhibits and Schedules hereto,
including the Investors' Rights Agreement, the Stockholders' Agreement and the
Schedule of Exceptions, and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
6.5 SEVERABILITY. In case any provision of the Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
6.6 AMENDMENT AND WAIVER.
(a) This Agreement may be amended or modified only upon the written
consent of the Company and holders of at least sixty-six and two-thirds percent
(66 2/3%) of the Shares (treated as if converted and including any Conversion
Shares into which the Shares have been converted that have not been sold to the
public).
(b) The obligations of the Company and the rights of the holders of the
Shares and the Conversion Shares under the Agreement may be waived only with the
written consent of the holders of at least sixty-six and two thirds percent (66
2/3%) of the Shares (treated as if converted and including any Conversion Shares
into which the Shares have been converted that have not been sold to the
public).
6.7 DELAYS OR OMISSIONS. It is agreed that no delay or omission to exercise
any right, power or remedy accruing to any party, upon any breach, default or
noncompliance by another party under this Agreement, the Investors' Rights
Agreement, the Stockholders' Agreement or the Certificate, shall impair any such
right, power or remedy, nor shall it be construed to be a waiver of any such
breach, default or noncompliance thereafter occurring. It is further agreed that
any waiver, permit, consent or approval of any kind or character on any
Purchaser's part of any breach, default or noncompliance under this Agreement,
the Investors' Rights Agreement, the Stockholders' Agreement or under the
Certificate or any waiver on such party's part of any provisions or conditions
of the Agreement, the Investors' Rights Agreement, the Stockholders' Agreement
or the Certificate must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, the Investors'
16.
Rights Agreement, the Stockholders' Agreement, the Certificate, by law, or
otherwise afforded to any party, shall be cumulative and not alternative.
6.8 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) upon receipt after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address set forth on EXHIBIT A attached hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
6.9 TITLES AND SUBTITLES. The titles of the sections and subsections of the
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement.
6.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
6.11 BROKER'S FEES. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 6.11 being untrue.
6.12 ATTORNEYS' FEES. In the event that any dispute among the parties to
this Agreement, the Investors' Rights Agreement or the Stockholders' Agreement,
the prevailing party in such dispute shall be entitled to recover from the
losing party all fees, costs and expenses of enforcing any right of such
prevailing party under or with respect to this Agreement, the Investors' Rights
Agreement, the Stockholders' Agreement, including without limitation, such
reasonable fees and expenses of attorneys and accountants, which shall include,
without limitation, all fees, costs and expenses of appeals.
6.13 EXPENSES. The Company shall pay all reasonable costs and expenses
incurred with respect to the negotiation, execution and delivery of any
amendment to this Agreement, the Certificate, the Investors' Rights Agreement
and the Stockholders' Agreement, to the extent any such amendment would
adversely affect the holders of Series C Stock.
6.14 HSR FILING FEES. The Company shall pay all costs and expenses of each
Purchaser, as they are incurred, with respect to any filing under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, and the rules
and regulations promulgated thereunder, in connection with such Purchaser's
investment in the Company, regardless of when such costs or expenses are
incurred.
6.15 EXCULPATION AMONG PURCHASERS. Each Purchaser acknowledges that it is
not relying upon any person, firm, or corporation, other than the Company and
its officers and
17.
directors, in making its investment or decision to invest in the Company. Each
Purchaser agrees that no Purchaser nor the respective controlling persons,
officers, directors, partners, agents, or employees of any Purchaser shall be
liable for any action heretofore or hereafter taken or omitted to be taken by
any of them in connection with the Shares and Conversion Shares.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
18.
IN WITNESS WHEREOF, the parties hereto have executed the SERIES C PREFERRED
STOCK PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.
COMPANY: PURCHASERS:
JATO COMMUNICATIONS CORP.
--------------------------------------
Please Print Name of Purchaser
By: /s/ Xxxxx X. Xxxx By:
------------------------------ -----------------------------------
Name: Xxxxx X. Xxxx Name:
---------------------------- ---------------------------------
Title: Title:
--------------------------- --------------------------------
0000 00xx Xxxxxx, Xxxxx 000 Address:
Xxxxxx, XX 00000 ------------------------------
--------------------------------------
SERIES C PREFERRED STOCK PURCHASE AGREEMENT
EXHIBIT A
SERIES C PREFERRED STOCK PURCHASE AGREEMENT
SCHEDULE OF PURCHASERS
NAME AND ADDRESS NUMBER OF SHARES PURCHASE PRICE
---------------- ---------------- --------------
Xxxxxxxx X, L.P. 1,367,143 $9,570,001.00
0000 Xxxx Xxxx Xxxx
Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx
Xxxxxxxx Associates Fund IV, L.P. 47,143 $330,001.00
0000 Xxxx Xxxx Xxxx
Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx
Xxxxxxxx Principals Fund, L.L.C. 157,143 $1,100,001.00
0000 Xxxx Xxxx Xxxx
Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx
Crest Communications Partners L.P. 428,571 2,999,997.00
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxxx
CEA Capital Partners USA, L.P. 327,557 $2,292,899.00
00 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx XxXxxx
CEA Capital Partners USA CI, L.P. 101,014 $707,098.00
00 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx XxXxxx
A-1
ABN AMRO Capital (USA), Inc. 198,096 $1,386,672.00
000 X. XxXxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
I Eagle Trust 71,690 $501,830.00
000 X. XxXxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
ABN AMRO Incorporated 15,928 $111,496.00
000 X. XxXxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
Access Technology Partners, L.P. 228,571 $1,599,997.00
Xxxxxxxxx & Xxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Access Technology Partners Brokers Fund, 4,286 $30,002.00
X.X.
Xxxxxxxxx & Xxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Xxxxxxxxx & Xxxxx California 14,286 $100,002.00
Xxxxxxxxx & Xxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
Xxxxxxxxx & Xxxxx Employee Venture Fund, 14,286 $100,002.00
X.X. XX
Xxxxxxxxx & Xxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
H&Q JATO Communications Investors, L.P. 24,285 $169,995.00
Xxxxxxxxx & Xxxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxx
TCI Satellite Entertainment, Inc. 714,286 $5,000,002.00(1)
0000 X. Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Xxxxx Xxxxxxx 5,000 $35,000.00
00000 X. Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Xxxxxxx X. Xxxxxx 14,286 $100,002.00
0000 Xxx Xxxx Xxxx
Xxxxxxx, XX 00000
Xxxxx X. Xxxxxx 14,285 $99,995.00
0000 Xxx Xxxx Xxxx
Xxxxxxx, XX 00000
Xxxx X. Xxxxxx, Xx. and Xxxxxxx X. Xxxxxx, 50,000 $350,000.00
as Joint Tenants
0000 X. Xxxxxxxx Xx.
Xxxxxxxxx Xxxxxxx, XX 00000
Xxxxxxx X. Xxxxxxxx 28,571 $199,997.00
000 Xxxxxxx Xxxxxx
Xxx. X
Xxx Xxxxxxxxx, XX 00000
-----------------------------
(1) Payment to made by delivery of $2,000,000.00 and a note in the amount of
$3,000,002.00.
Xxxxxx X. Xxxxxxxx 30,000 $210,000.00
c/o Jato Communications Corp.
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Xxxxxx X. Xxxxxx 8,000 $56,000.00
000 Xxxxxxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Xxxxxx X. Xxxxx and Xxxx X. Xxxxx, 5,000 $35,000
as Joint Tenants
0 Xxxxx Xxx Xxxx
Xxxxxxxxx, XX 00000
Xxxxxx X. Xxxxxx 14,286 $100,002.00
0000 X. Xxxxxxxx Xxxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Xxx Xxxxxxx 7,143 $50,001.00
0000 X. Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxx 14,286 $100,002.00
000 Xxxxxx Xxxx Xxxx
Xxxxxx Xxxx, XX 00000
Trustee F.B.O. FWD Corporation Savings & 14,286 $100,002.00
Profit Sharing Trust,
Xxxxx X. Xxxxx, Segregated Account
c/o - Xxxxx X. Xxxxxx, President
Pension Inc., Trustee
000 X. Xxxxx Xxxxxx
Xxxxx Xxx, XX 00000
COPY OF ANY CORRESPONDENCE TO :
Xxxxx X. Xxxxx, Segregated Account
X0000 Xxxxxxxxxx Xxxx Xxxx
Xxxxxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxx 2,143 $15,001.00
00000 X. 00xx Xxxxx
Xxxxxx, XX 00000
Xxxxxxx X. Xxxxx and Xxxx X. Xxxxx, as 7,143 $50,001.00
Joint Tenants
0000 Xxxxx Xxxxxxx Xxxxx
Xxxxxx, XX 00000
Xxxxx X. Xxxxxxx 10,000 $70,000.00
0000 Xxxxx Xxx Xxxxx ------ ----------
Xxxxxxxxx, XX 00000
Total 3,938,714 $27,570,998.00
--------- --------------
--------- --------------
EXHIBIT B
RESTATED CERTIFICATE OF INCORPORATION
B-1
EXHIBIT C
AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
C-1
EXHIBIT D
AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
D-1
EXHIBIT E
FORM OF PROPRIETARY INFORMATION
AND INVENTIONS AGREEMENT
E-1
EXHIBIT F
LEGAL OPINION
F-1
TABLE OF CONTENTS
PAGE
SECTION 1.AGREEMENT TO SELL AND PURCHASE......................................1
1.1 Authorization of Shares.....................................1
1.2 Sale and Purchase...........................................1
SECTION 2.CLOSING, DELIVERY AND PAYMENT.......................................1
2.1 Closing.....................................................1
2.2 Delivery....................................................2
SECTION 3.REPRESENTATIONS AND WARRANTIES OF THE COMPANY.......................2
3.1 Organization, Good Standing and Qualification...............2
3.2 Subsidiaries................................................2
3.3 Capitalization; Voting Rights...............................3
3.4 Authorization; Binding Obligations..........................3
3.5 Financial Statements........................................4
3.6 Liabilities.................................................4
3.7 Agreements; Action..........................................4
3.8 Obligations to Related Parties..............................5
3.9 Absence of Changes..........................................5
3.10 Real Properties; Tangible Personal Property.................7
3.11 Patents and Trademarks......................................7
3.12 Compliance with Other Instruments...........................8
3.13 Litigation..................................................8
3.14 Tax Returns and Payments....................................8
3.15 Employees...................................................9
3.16 Proprietary Information and Inventions Agreements...........9
3.17 Obligations of Management...................................9
3.18 Registration Rights........................................10
3.19 Compliance with Laws; Permits..............................10
3.20 Offering Valid.............................................10
3.21 Full Disclosure............................................10
3.22 Application of Proceeds....................................10
3.23 Certain Limitations........................................11
3.24 Environmental..............................................11
i.
3.25 Insurance..................................................11
3.26 Small Business Matters.....................................11
3.27 Qualified Small Business...................................12
SECTION 4.REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS...................12
4.1 Requisite Power and Authority..............................12
4.2 Investment Representations.................................12
4.3 Transfer Restrictions......................................13
SECTION 5.CONDITIONS TO CLOSING..............................................13
5.1 Conditions to Purchasers' Obligations at the Closing.......13
5.2 Conditions to Obligations of the Company...................15
SECTION 6.MISCELLANEOUS......................................................15
6.1 Governing Law..............................................15
6.2 Survival...................................................16
6.3 Successors and Assigns.....................................16
6.4 Entire Agreement...........................................16
6.5 Severability...............................................16
6.6 Amendment and Waiver.......................................16
6.7 Delays or Omissions........................................16
6.8 Notices....................................................17
6.9 Titles and Subtitles.......................................17
6.10 Counterparts...............................................17
6.11 Broker's Fees..............................................17
6.12 Attorneys' Fees............................................17
6.13 Expenses...................................................17
6.14 HSR Filing Fees............................................17
6.15 Exculpation Among Purchasers...............................17
ii.
INDEX OF EXHIBITS
Schedule of Purchasers Exhibit A
Restated Certificate of Incorporation Exhibit B
Amended and Restated Investors' Rights Agreement Exhibit C
Amended and Restated Stockholders' Agreement Exhibit D
Form of Non-Competition Proprietary
Information and Inventions Agreement Exhibit E
Form of Legal Opinion Exhibit F
