EXHIBIT 9.1
VOTING AND SHAREHOLDERS AGREEMENT dated as of May 21, 1999 by and among
Advanced Medical Sciences, Inc., a Virginia corporation ("Advanced"), the sole
shareholder of America's Shopping Mall, Inc., a Nevada corporation (the
"Company"), Pioneer Ventures Associates Limited Partnership, having an office at
000 Xxx Xxxx Xxxx, Xxxxxxx, Xxxxxxxxxxx 00000 (the "Pioneer Partnership"), AND
certain Shareholders of Advanced, who are parties hereto (collectively
hereinafter referred to as the "Principal Shareholders").
WHEREAS, the Principal Shareholders have "beneficial ownership," as that
term is defined under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") of an aggregate of 28,550,000 shares of common stock, $.001 par
value per share ("Common Shares") of Advanced as more specifically set forth in
Exhibit A attached hereto;
WHEREAS, pursuant to a certain Investment Agreement dated the date hereof
(the "Investment Agreement"), the Pioneer Partnership is investing in the
Company through the purchase of Preferred Stock and Warrants and may make
additional investments in the Company through the exercise of the Warrants in
the future and the Company is assuming Two Million Dollars ($2,000,000) in
principal amount of debt owed from Initio, Inc. to the Company and, in
connection therewith is issuing to the Pioneer Partnership a debenture in the
principal amount of Two Million Dollars ($2,000,000) of even date herewith (the
"Debenture"); and
WHEREAS, Advanced and the Company are parties to an Agreement and Plan of
Merger dated May 21, 1999 pursuant to which Advanced is to be merged into the
Company (the "Merger");
WHEREAS, the execution of this Agreement by the parties hereto is a
condition precedent to the consummation of the transactions provided for in the
Investment Agreement.
NOW, THEREFORE, in consideration of the mutual promises contained herein,
the parties hereto agree as follows:
ARTICLE I.
1.1 Voting by Principal Shareholders; Agreement to Vote.
Each of Advanced and the Principal Shareholders agrees that, so long as (i)
the Pioneer Partnership, its Partners or affiliates shall own any Preferred
Stock, Warrants or Common Stock obtained either through conversion of the
Preferred Stock or exercise of the Warrants, or (ii) any amounts remain
outstanding under the Debenture Advanced, and upon consummation of the Merger,
each of the Principal Shareholders shall vote all of their Common Shares,
whether now owned or hereafter acquired, for the election as a director(s) of
the Company of the designee(s) of the Pioneer Partnership in accordance with
paragraph 1.10 of the Investment Agreement at any meeting of the Company's
shareholders at which such designee shall be nominated as a director. Without
limiting the generality of the foregoing, Advanced and the Principal
Shareholders agree to execute and deliver any and all documents, agreements and
instruments, including, without limitation, proxies,
as the Pioneer Partnership shall reasonably request so that at least one (1)
designee of the Pioneer Partnership shall be a director of the Company at all
times while any Preferred Stock or such Common Stock is held by the Pioneer
Partnership or any amounts remain outstanding under the Debenture.
1.2 Special Meeting Upon Default.
In the event of a default under, or a breach of, this Agreement which (in
the judgment of the Pioneer Partnership) adversely affects the Pioneer
Partnership, or the Investment Agreement, or the Certificate of Designation of
Preferred Stock under which the Pioneer Partnership or its assigns are a holder
of Preferred Stock, or under the Debenture, Advanced and the Principal
Shareholders agree to call and the Company agrees to pay the expenses associated
with a special meeting of the Shareholders at the sole expense of the Company,
and Advanced and the Principal Shareholders each agree that they shall vote in
favor of that number of and those nominees to the Board of Directors designated
by the Pioneer Partnership such that the nominees of the Pioneer Partnership,
taken in the aggregate, shall constitute a majority of the directors of the
Company, after any such defaults, for so long as the Pioneer Partnership, its
partners or affiliates own Preferred Stock, Warrants or Common Stock obtained
through the conversion of Preferred Stock or the exercise of Warrants or there
remains any amount outstanding under the Debenture. Advanced and the Principal
Shareholders hereby agree to take no action to contravene, limit or otherwise
terminate the Pioneer Partnership board election mechanism. Advanced and the
Principal Shareholders agree to vote in favor of such Pioneer Partnership
nominees for so long as the Pioneer Partnership, its partners or affiliates own
Preferred Stock, Warrants or Common Stock obtained through the conversion of
Preferred Stock or the exercise of Warrants or there remains any amount
outstanding under the Debenture.
1.3 Preservation of Bylaws.
The provisions of Sections 1(a) and 1(b) above are in consonance with the
amendments to of the Bylaws of the Company as set forth in the minutes of a
special meeting (Unanimous Written Consent) of the Board of Directors of the
Company, attached hereto as Exhibit B, and incorporated herein by this reference
(the "Resolutions"). If the directors or the shareholders of the Company further
amend such Bylaws at any time during which the Pioneer Partnership shall own any
Preferred Stock, Warrants or Common Stock obtained upon conversion of Preferred
Stock or exercise of Warrants or there remains any amount outstanding under the
Debenture, notice shall be given to the Pioneer Partnership, and upon the
written demand therefor by the Pioneer Partnership, Advanced or the Principal
Shareholders shall promptly call a special meeting of the Shareholders and the
Company hereby agrees to pay all expenses in connection with such meeting, at
the sole expense of the Company, and Advanced and the Principal Shareholders
each agree that they shall vote all of their Common Shares, whether now owned or
hereafter acquired, for the Bylaws to be restored to or retained, as the case
may be, to the form as set forth in the Resolutions, in accordance with the
Bylaws.
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ARTICLE II. Transfers
2.1 Transfer of Common Shares to Affiliates.
During the term of this Agreement, neither Advanced, the Principal
Shareholders nor any other person who shall become a party to or bound by this
Agreement shall transfer any Common Shares, whether now or hereafter acquired,
other than (i) to any person who agrees to be bound by and be subject to the
terms and conditions of this Agreement with the same force and effect as if such
person were named as a party to this Agreement or as a Principal Shareholder
hereunder, provided that the Pioneer Partnership consents to such transfer, such
consent not to be unreasonably withheld, and (ii) beginning May 21, 2000,
pursuant to any sale of securities pursuant to a distribution to the public,
whether pursuant to a registered public offering, a Rule 144 sale or otherwise,
provided that the Pioneer Partnership consents to such sale, such consent not to
be unreasonably withheld.
2.2 Legend on Stock Certificates.
Advanced and the Principal Shareholder shall submit to the Transfer Agent
for the Common Stock the certificates evidencing the Common Stock owned by
Advanced or the Principal Shareholders at any time during the term of this
Agreement (the "Restricted Shares") and the Company shall cause the Transfer
Agent to imprint upon such certificates (or replacement certificates) a
restrictive legend as follows:
The shares of stock represented by this certificate are subject to all of
the terms of a certain Voting and Shareholders Agreement dated May 21, 1999, a
copy of which is on file at the offices of the issuer of this certificate. The
shares are subject to certain voting, co-sale and transfer restrictions. Any
actions taken in contravention to that agreement shall be null and void.
The terms of such endorsement and restrictions are hereby expressly
consented to and accepted.
ARTICLE III. Co-Sale Provisions
3.1 Third-Party Offer and Notice.
Any voluntary or involuntary transfer of the Common Shares by Advanced or
any Principal Shareholder will be subject to a participation right of co-sale by
the Pioneer Partnership or its assigns on a pro rata fully diluted basis. If any
one or more of Advanced or the Principal Shareholders obtain from a third party
("Third Party Purchaser") an offer to purchase any amount of his or her Shares,
and Advanced or the Principal Shareholder(s) wish to accept such offer, Advanced
or the Principal Shareholder(s) shall submit a written notice (the "Co-Sale
Notice") to the Pioneer Partnership disclosing the amount of Common Shares
proposed to be sold, the offered
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purchase price, the proposed closing date, and the total number of Common Shares
owned by the Principal Shareholder(s).
3.2 Co-Sale Right of Participation.
Upon receipt of a Co-Sale Notice from Advanced or any Principal
Shareholder, the Pioneer Partnership or its assigns may elect to participate in
such transaction and shall have the right to offer its securities, at the same
price and on the same terms, on a fully diluted pro rata basis with the proposed
selling shareholder(s) as set forth in the offer made by the Third Party
Purchaser. Each participating selling party shall in turn be entitled to receive
at the applicable closing the net proceeds of the sale allocable to the
securities sold on behalf of each selling shareholder, after deduction of such
selling shareholder's proportionate share of the reasonable expenses of the
sale. These co-sale provisions will not apply to any sale of securities pursuant
to a distribution to the public, whether pursuant to a registered public
offering, a Rule 144 sale or otherwise. If less than all of a shareholder's
securities are being sold pursuant to this Article III, the securities to be
sold shall be determined on a pro rata fully diluted basis.
3.3 Notice of Intent to Participate in Co-Sale.
If the Pioneer Partnership wishes to participate in any sale under this
Article III, then the Pioneer Partnership shall notify Advanced or the selling
Principal Shareholder(s) in writing of such intention as soon as practicable
after such Pioneer Partnership's receipt of the Co-Sale Notice made pursuant to
Section 3.1, and in any event within fifteen (15) business days after the date
of such Co-Sale Notice has been delivered. Such notification shall be delivered
in person or by facsimile to Advanced or the Principal Shareholder(s) at the
Company's offices.
ARTICLE IV. Remedies
4.1. Violation of Agreement; Consent to Injunctive Relief.
Each of Advanced and the Principal Shareholders recognizes and agrees that
any violation of any of his or her obligations set forth in this Agreement would
cause irreparable damage which could not be compensated by monetary damages.
Such violation shall constitute an Event of Default under the Investment
Agreement. Accordingly, in the event of any breach of any obligations of
Advanced or any Principal Shareholder under this Agreement, Advanced or such
Principal Shareholder consents to the entry of injunctive relief, including the
remedy of specific performance, by a court of competent jurisdiction restraining
any such violation or threatened violation, and/or granting full voting
authority to the Pioneer Partnership for purposes of this Agreement, in addition
to any other remedies available at law or in equity. Advanced or the Principal
Shareholders agree to pay the reasonable costs of the Pioneer Partnership,
including reasonable attorneys fees, incurred in enforcing the provisions of
this Article IV.
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ARTICLE V. Miscellaneous
5.1. Representations.
Advanced and the Principal Shareholders represent and warrant that, at the
date hereof, they are the sole record and beneficial owners of the securities of
the Company set forth opposite his name on Exhibit A to this Agreement and has
full power to enter into this Agreement and to perform its obligations
hereunder. Each of Advanced and the Principal Shareholders represents that
he/she is not the beneficial owner of any Common Shares or any warrants,
options, rights to acquire or securities convertible into Common Shares NOT
disclosed herein, whether directly, through any affiliate or otherwise.
5.2 Term.
This Agreement shall terminate on the earlier to occur of (i) ten (10)
years from the Closing Date or (ii) the date upon which the Pioneer Partnership,
its partners and affiliates no longer own five percent (5%) of the Preferred
Stock (including for purposes of such calculation all shares of Common Stock
received upon conversion of the Preferred Stock), and no amounts remain
outstanding under the Debenture.
5.3 Further Assurances.
From and after the date of this Agreement, the parties hereto shall
from time to time, at the request of any other party and without further
consideration, do, execute and deliver, or cause to be done, executed and
delivered, all such further acts, things and instruments as may be reasonably
requested or required more effectively to evidence and give effect to the
transactions provided for in this Agreement.
5.4 Notices.
All notices, requests, demands and other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been duly given if personally delivered or if mailed by first class registered
or certified mail return receipt requested, or by first class mail or overnight
courier if received, addressed to the parties at their respective addresses set
forth on the first page of this Agreement, or to such other person or address as
may be designated by like notice hereunder.
5.5 Modifications.
This Agreement may not be modified or discharged orally, but only in
writing duly executed by the party to be charged. In the event the Merger is
consummated, Advanced shall cease to exist as a separate corporation and this
Agreement shall remain in full force and effect between Pioneer and the
Principal Shareholders.
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5.6 Successors and Assigns.
All the covenants, stipulations, promises and agreements in this
Agreement shall bind the parties' respective heirs, successors and assigns,
whether so expressed or not.
5.7 Headings.
The headings of the various sections of this Agreement are for
convenience of reference only and shall in no way modify any of the terms or
provisions of this Agreement.
5.8 Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Nevada applicable to instruments made and to be performed
entirely within such State.
5.9 Counterparts.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original but all of which together shall constitute one and
the same document.
5.10 Gender.
All pronouns used herein are inserted for convenience only and shall be
applied in the masculine, feminine, or third person as appropriate for each
party signing hereto.
5.11 Use of Term "Pioneer Partnership". Notwithstanding any provision of
this Agreement to the contrary, included in the definition and meaning of the
"Pioneer Partnership" shall be any one or more parallel limited partnerships
which have been or shall be organized by Ventures Management Partners LLC as the
general partner to invest in parallel with Pioneer Ventures Associates Limited
Partnership on the same economic terms and pro rata based upon their aggregate
subscriptions. The limited partners of Pioneer Ventures Associates Limited
Partnership and the parallel partnerships shall be referred to herein as the
"limited partners".
5.12 Capitalized terms use in this Agreement but not otherwise defined
herein shall have the meanings given to them in the Investment Agreement.
[ SIGNATURE PAGE TO FOLLOW ]
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date and year first above written.
By the Pioneer Partnership:
PIONEER VENTURES ASSOCIATES LIMITED PARTNERSHIP
By: Pioneer Ventures Corp.,
Managing Member
of the General Partner
Ventures Management Partners LLC
By: /s/ Xxxx X. Xxxxxxx
-------------------------------
Xxxx X. Xxxxxxx, Director
ADVANCED MEDICAL SCIENCES, INC.
By: /s/ Xxxxx Xxxxxxxxxxx, President
---------------------------------
Name:
Title:
Consented to, and the obligation set forth in Article I to pay for such special
meetings of the Shareholders is hereby agreed to:
AMERICA'S SHOPPING MALL, INC.
By: /s/ Xxxxx Xxxxxxxxxxx, President
---------------------------------
Name:
Title:
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By: /s/ Xxxxx Xxxxxxxxxxx
------------------------------------
Xxxxx Xxxxxxxxxxx
By: /s/ Xxxxxx XxXxxx
------------------------------------
Xxxxxx XxXxxx
By: /s/ Xxxxxx Xxxxxx
------------------------------------
Xxxxxx Xxxxxx
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Xxxxxx X. Xxxxxx Xx.
By: /s/ Xxx Xxxxxx
------------------------------------
Xxx Xxxxxx
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Xxxx X. Xxxxxx
By: /s/ Xxx X. Xxxxxx
------------------------------------
Xxx X. Xxxxxx
By: /s/ Xxxxxxxx Xxxxxx
------------------------------------
Xxxxxxxx Xxxxxx
By: /s/ Xxxxxxxx Xxxxxx
------------------------------------
Xxxxxxxx Xxxxxx
Cust. Xxxx Xxxxxx
By: /s/ Xxxxx X. Xxxxxx
------------------------------------
Xxxxx X. Xxxxxx
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EXHIBIT A
to
VOTING AGREEMENT
Principal Shareholders No. of Common Shares
Xxxxx Xxxxxxxxxxx 3,000,000
Xxxxxx XxXxxx 300,000
Xxxxxx Xxxxxx 300,000
Xxxxxx X. Xxxxxx Xx. 1,200,000
Xxx Xxxxxx 3,000,000
Xxxx X. Xxxxxx 2,740,000
Xxx X. Xxxxxx 2,840,000
Xxxxxxxx Xxxxxx 10,000,000
Xxxxxxxx Xxxxxx
Cust. Xxxx Xxxxxx 2,670,000
Xxxxx X. Xxxxxx 2,500,000
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28,550,000
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EXHIBIT B
to
VOTING AGREEMENT
(Resolutions approved by Board of Directors)
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