Exhibit 4.5
YOUNG LLC
Xxxxxxx Xxxxx
0xx Xxxxx
P.O. Box 972
Road Town
British Virgin Island, Tortola
February 3, 2000
Interactive Xxxxxxxxxxxx.Xxx, Ltd.
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx Xxxxx, Xxxxxxx 00000
Attention: President
Re: Interactive Xxxxxxxxxxxx.Xxx, Ltd., (the "Company")
Gentlemen:
Reference is made to the Common Stock Purchase Agreement (the "Purchase
Agreement"), of even date hereof, between the Company and the undersigned (the
"Purchasers").
During the eighteen (18) month period following the Effective Date, the
Purchasers additionally commit, subject to and upon the terms and conditions
hereof, to purchase from the Company, and the Company shall sell to the
Purchasers shares of Common Stock (the "Additional Shares") for an aggregate
purchase price of up to $16,000,000 at a price equal to 90% of the two (2)
lowest closing bid prices of the Common Stock (not necessarily consecutive) for
the ten (10) trading days prior to each Additional Financing Notice.
The commitment of the Purchasers set forth in this letter is subject to
the terms, conditions and qualifications set forth below:
1. Additional Documentation. In order to effectuate a purchase and sale of
the Additional Shares, prior to their issuance, the Company and the Purchasers
shall enter into the following agreements: (a) a securities purchase agreement
(the "Additional Purchase Agreement") setting forth the terms and conditions of
the purchase and sale, and (b) a registration rights agreement identical to the
Registration Rights Agreement (the "Additional Registration Rights Agreement",
and together with the Additional Purchase Agreement, collectively the
"Additional Transaction Documents"). The Purchasers shall prepare the Additional
Transaction Documents, which shall be in form mutatis mutandis to the initial
Transaction Documents.
2. The Additional Closing. (i) The Company shall have the right to deliver
one or more written notices to the Purchasers (the "Additional Financing
Notice") requiring such parties to buy the Additional Shares for an aggregate
purchase price of $16,000,000 (the "Additional Purchase Price"), but not to
exceed $2,000,000 per Additional Financing Notice. The Company agrees to deliver
one or more Additional Financing Notices for a minimum of $4,000,000. An
Additional Financing Notice may be delivered no earlier than fifteen (15)
Trading Days following the Effective Date or the prior Additional Financing
Notice. The closing of the purchase and sale of the Additional Securities (the
"Additional Closing") shall take place at the offices of Xxxxxxx & Xxxxxx, LLP,
Suite 1440, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 on the fifth (5th) Business
Day after the Additional Financing Notice is received by the Purchasers or the
Company, as the case may be, or on such other date as otherwise agreed to by the
parties hereto; provided, however, that in no case shall the Additional Closing
take place unless and until all of the conditions listed in Section 3 of this
letter and the Additional Purchase Agreement shall have been satisfied by the
Company or waived by the Purchasers. The date of each Additional Closing is
hereinafter referred to as the "Additional Closing Date." Notwithstanding
anything to the contrary contained in this letter, each Purchaser may designate
an Affiliate thereof to acquire all or any portion of the Additional Securities.
(ii) At the Additional Closing, the parties shall deliver or shall
cause to be delivered the following: (a) the Company shall deliver to (x) each
Purchaser or its designated Affiliate, (1) the number of Additional Shares
registered in the name of such Purchaser or its designated Affiliate,
representing the shares of Common Stock to be issued and sold to such Purchaser
at the Additional Closing; (2) a legal opinion in form and substance acceptable
to the Purchasers, and (3) executed Additional Transaction Documents and the
Transfer Agent Instructions relating to the Additional Securities, and (4) a
four (4) year transferable divisible warrant in the form of the Transaction
Documents to purchase shares equal to 20% of the Additional Financing Notice
with an exercise price equal to 120% of the average of the closing bid prices
for the five day trading period immediately preceding the Additional Closing
Date with provisions for cashless exercise at the Purchaser's option and with
"piggy back" registration rights, (y) to Xxxxxxx & Prager, LLP, $15,000 at the
First Additional Closing and $3,500 at each Additional Closing thereof, as
payment of the legal fees and expenses incurred by the Purchasers to prepare the
Additional Transaction Documents, which amount shall be deducted by the
Purchasers from the amount due to the Company for the Additional Securities and
shall be paid directly to Xxxxxxx & Xxxxxx, LLP., (z) the fees of Ladenburg
Xxxxxxxx Co., Inc.; and (b) each Purchaser shall deliver to the Company (1) its
pro rata portion of the Additional Purchase Price, in United States dollars in
immediately available funds by wire transfer to an account designated in writing
by the Company for such purpose prior to the Additional Closing Date and (2) the
executed Additional Transaction Documents.
3. Conditions precedent to the Additional Closing. Notwithstanding
anything to the contrary contained in this letter, the commitment of a Purchaser
to purchase the Additional Securities is subject to the satisfaction or waiver
by the Purchasers of each of the following conditions:
(a) Closing of Initial Shares and Initial Warrants. The Initial
Closing shall have occurred;
(b) Performance by the Company. The Company shall have performed,
satisfied and complied with all covenants, agreements and conditions required by
the Transaction Documents to be performed, satisfied or complied with by the
Company between the Closing Date and the Additional Closing Date and no
Potential Material Event (as defined in the Registration Rights Agreement )
shall have occurred;
(c) Underlying Shares Registration Statement. The Additional Shares
Registration Statement shall have been declared effective under the Securities
Act by the Commission and shall have remained effective at all times, not
subject to any actual or threatened stop order or subject to any actual or
threatened suspension at any time prior to the Additional Closing Date;
(d) Shares of Common Stock. The Company shall have duly reserved the
number of shares of Common Stock as required by the Additional Transaction
Documents;
(e) Closing Threshold. For the twenty (20) Trading Days immediately
preceding both the Additional Financing Notice and the Additional Closing Date,
the average daily weighted dollar trading volume of the Common Stock on the
NASDAQ, based on the Closing Bid Price, shall be at least 50 % of the amount of
the Additional Financing Notice and the average of the Per Share Market Value
for such twenty (20) Trading Day period shall be greater than $2.00.
(f) Deliveries pursuant to Additional Transaction Documents. At the
Additional Closing, the Company shall deliver the Additional Securities and
executed Additional Transaction Documents relating to the Additional Securities
in the forms contemplated by this letter.
(g) Restriction on Future Financing. (i) The Company covenants and
agrees that it will not, without the prior written consent of the Purchasers,
enter into any subsequent or further offer or sale of Common Stock or securities
convertible into Common Stock (collectively, New Common Stock ) with any third
party on any date which is thirty (30) trading days prior or subsequent to any
Additional Closing Date.
(ii) The provisions of subparagraph (g)(I) will not apply to
(w) Common Stock issued pursuant to an exemption from registration under the
Securities Act of 1933; (x) an underwritten public offering of shares of Common
Stock or Preferred Stock; (y) an offering of convertible Preferred Stock or
Debentures at market or above; or (z) the issuance of securities (other than for
cash) in connection with an acquisition, merger, consolidation, sale of assets,
disposition or the exchange of the capital stock for assets, stock or other
joint venture interests.
4. Governing Law. This letter shall be governed by and construed and
enforced in accordance with the internal laws of the State of Delaware, without
regard to the principles of conflicts of law thereof.
5. Execution. This letter may be executed in two or more counterparts, all
of
which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.
Please indicate your agreement with the foregoing by executing a
countersigned copy of this letter and returning the same to our attention,
whereupon effective immediately thereafter this letter shall become a legally
valid and binding agreement between the Purchasers and the Company.
We look forward to our continuing relationship.
Sincerely,
Young LLC
By:__________________________________________
Name:________________________________________
Title:_______________________________________
Agreed and accepted
February 3, 2000
INTERACTIVE XXXXXXXXXXXX.XXX, LTD.
By:__________________________________________
Xxxxxxx X. Xxxxxx, Chief Executive Officer
