DIGITALPOST INTERACTIVE, INC. SECURITIES PURCHASE AGREEMENT
Exhibit
99.01
This
Securities Purchase Agreement (this “Agreement”)
is made as of September __, 2008 by and between (i) DigitalPost Interactive, Inc.,
a Nevada corporation (the “Company”),
and (ii) Agile Opportunity
Fund, LLC, a Delaware limited liability company (“Agile”
or the “Investor”).
In
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Purchase
and Sale of Securities.
1.1 Sale and
Issuance of Note; Closing.
(a) Subject
to the terms and conditions of this Agreement and in reliance on the
representations and warranties set forth or referred to herein, the Company
hereby agrees to sell and issue to the Investor, and the Investor hereby agrees
to purchase from the Company, (i) at the Closing (as hereinafter defined), an
Original Issue Discount Term Secured Convertible Promissory Notes in the face
amount of $180,000 for an aggregate purchase price of $150,000 (the “Note
Purchase Price”), such Secured Convertible Promissory Note to be in the
form attached hereto as Exhibit A
(the "Note")
with a maturity date of September __, 2009 (the “Maturity
Date”). The Note, including accrued but unpaid interest
thereon, will be convertible into shares of Common Stock of the Company (“Common
Stock”), at a conversion price of $0.123 per share, subject to adjustment
as provided therein, (the “Common
Stock Conversion Shares”).
(b) In
connection with the purchase and sale of the Note hereunder and in addition
thereto, the Company agrees to issue to the Investor (i) warrants to purchase an
aggregate of 750,000 shares of Common Stock at the exercise price of $0.123 per
share of Common Stock and in the form attached as Exhibit
B-1 hereto (the “Series C
Warrants”) and (ii) warrants to purchase an aggregate of 750,000 shares
of Common Stock at an exercise price of $0.15 per share and in the form attached
as Exhibit
B-2 hereto (the “Series D
Warrants”), with the exercise prices subject to adjustment as provided
therein (the Series C Warrants and Series D Warrants being collectively referred
to as the “Warrants”). The
Note and the Warrants are collectively referred to herein as the “Securities”.
1.2 Closing. The closing of
the purchase, sale and issuance of the Note shall take place at the offices of
▇▇▇▇▇▇▇▇▇ Ball ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, LLP (“WBEMS”),
▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, simultaneous with
the execution hereof (the "Closing"). At
the Closing (i) the Company will deliver to the Investor the duly executed Note
and the duly executed Warrants to be delivered thereat pursuant to Section
1.1(b) hereof against delivery by the Investor to the Company of the Note
Purchase Price by wire transfer of the amount thereof to the Company’s account
or by such other method agreed to between the Investor and the Company and (ii)
the Company shall execute the Amendment to Security Agreement amending the
existing Security Agreement between the Company and the
Investor
extending the first priority security interest in the “Collateral” referred to
therein previously granted to the Investor to secure the repayment of the Note
hereunder in the form of Exhibit C
attached hereto (the “Security
Agreement Amendment”). Further, at or prior to the Closing,
certain executive officers of the Company shall simultaneously close on an
aggregate investment in the Company of $150,000, the closing of such investment
being a condition precedent to the obligation of the Investor to consummate the
transactions hereunder at the Closing.
1.3 Fees and
Expenses. At the Closing,
the Company shall pay an aggregate of $11,000 in fees due to third party agents
and expenses incurred by the Investor and/or Agile Investments, LLC in
connection with the transactions hereunder, including (i) the legal fees and
expenses of WBEMS incurred in connection with the preparation of this Agreement
and the consummation of the transactions contemplated hereby in the amount of
$5,000 and (ii) $6,000 payable to Agile Investments, LLC for due diligence
costs, structuring and monitoring fees.
1.4 Defined
Terms Used in this Agreement. In addition to
the terms defined elsewhere in this Agreement, the following terms used in this
Agreement shall be construed to have the meanings set forth below.
“Approvals”
means, collectively, all actions, approvals, consents, waivers, exemptions,
Orders, authorizations, registrations, declarations, filings and
recordings.
“Business
or Condition” of the Company means the business, operations, assets,
properties, earnings, prospects or condition (financial or other) of the
Company.
“Exchange
Act” means the Securities Exchange Act of 1934, as amended.
“Governmental
Body” means any federal, state, municipal, local or other governmental
department, commission, board, bureau, agency, instrumentality, political
subdivision or taxing authority, of any country.
“Intellectual
Property” any patents, patent applications, trademarks, trademark
applications, service marks, service ▇▇▇▇ applications, trade names, copyrights,
manufacturing processes, formulae, trade secrets and know-how of a
Person.
“Material
Adverse Change; Material Adverse Effect; Materially Adverse” in, on or
with respect to, the Company, shall mean a material adverse change in the
Company’s Business or Condition, a material adverse effect on the Company’s
Business or Condition or an event which is materially adverse to the Company's
Business or Condition.
“Order”
means any order, writ, injunction, decree, judgment, award, determination,
direction or demand by a Governmental Body, arbitrator or court.
“Person”
means any individual, corporation, association, partnership, joint venture,
limited liability company, trust or estate, organization, business, government
or agency or political subdivision thereof, or any other
entity.
“Public
Offering” means any offering by the Company of its capital stock or
equity securities to the public pursuant to an effective registration statement
under the Securities Act or any comparable statement under any similar federal
statute then in force.
“Sale of
the Company” means either (i) the sale, lease, transfer, conveyance
or other disposition, in one or a series of related transactions, of all or
substantially all of the assets of the Company or (ii) a transaction or
series of transactions (including, without limitation, by way of merger,
consolidation, or sale of equity) the result of which is that the holders of the
Company’s outstanding voting securities immediately prior to such transactions
are after giving effect to such transactions no longer, in the aggregate, the
“beneficial owners” (as such term is defined in Rule 13d-3 and
Rule 13D-5 promulgated under the Securities Exchange Act), directly or
indirectly through one or more intermediaries, of more than 50% of the voting
power of the outstanding voting securities of the Company.
“Securities
Act” means the Securities Act of 1933, as amended.
1.5 Beneficial
Ownership Limitations. Notwithstanding anything to the
contrary contained herein, at no time shall the Investor together with any
“affiliates” of the Investor (as defined in the Exchange Act) “beneficially own”
(as defined in the Exchange Act) in excess of Four and 99/00 percent (4.99%) of
the outstanding shares of Common Stock of the Company. Accordingly,
the Investor shall not convert any portion of the Note or exercise any of the
Warrants if, as a result of such conversion or exercise, the Investor (together
with the Investor’s affiliates) would beneficially own in excess of Four and
99/00 percent (4.99%) of the outstanding shares of Common Stock, inclusive of
shares of Common Stock beneficially owned by the Investor and acquired other
than through the conversion of the Note or exercise of the Warrants, without the
prior written consent of the Company.
2. Representations
and Warranties of the Company. The Company
hereby represents and warrants to the Investor that:
2.1 Organization,
Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Nevada and has all requisite corporate power and authority to
carry on its business as presently conducted or proposed to be
conducted. The Company is duly qualified to transact business and is
in good standing in each jurisdiction in which the failure so to qualify would
have a Material Adverse Effect.
2.2 Capitalization. As of immediately
prior to the Initial Closing, the authorized capital stock of the Company
consists of 480,000,000 shares of Common Stock, of which 59,014,607 are issued
and outstanding. All of the outstanding shares of Common Stock have
been duly authorized, are fully paid and nonassessable. Schedule
2.2 describes all securities exercisable or convertible into Common Stock
and also identifies the stockholders of record and beneficially and the holders
and amounts of all other outstanding securities of the Company, including,
without limitation, any securities convertible or exchangeable into shares of
Common Stock, in any such case in excess of five (5%) percent of the
“fully-diluted” outstanding shares of Common Stock.
2.3 Authorization. All corporate
action on the part of the Company necessary for the authorization, execution and
delivery of this Agreement and the Security Agreement Amendment and the
authorization, issuance and delivery of the Securities has been taken and this
Agreement and the Security Agreement Amendment, when executed and delivered by
the Company and assuming due execution and delivery by the Investors, shall
constitute valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, or other laws of general application relating to or affecting the
enforcement of creditors’ rights generally, and as limited by laws relating
to the availability of specific performance, injunctive relief, or other
equitable remedies.
2.4 Valid
Issuance of Securities. The Securities
when issued, sold and delivered in accordance with the terms hereof for the
consideration expressed herein, will be duly and validly issued, fully paid and
nonassessable and free of restrictions on transfer other than restrictions on
transfer under applicable state and federal securities laws.
2.5 Consents
and Approvals. No Approval by,
from or with and no other action in respect of, any Governmental Body or any
other Person (including any trustee or holder of any indebtedness, securities or
other obligations of the Company) is required (a) for or in
connection with the valid execution and/or delivery by the Company of
or the performance by the Company of its obligations under this Agreement
or the Security Agreement Amendment or the consummation by the Company of the
transactions contemplated hereby, including the offer, issuance, sale and
delivery by the Company of the Securities, or (b) as a condition to
the legality, validity or enforceability as against the Company of this
Agreement or the Security Agreement Amendment.
2.6 Intellectual
Property. The Company represents and warrants that it has full
right, title and interest in and to, or otherwise has the right to license its
Intellectual Property. Schedule
2.6 identifies the Company’s material Intellectual Property. To the best
of the Company's knowledge, no claim is pending nor has the Company received
notice to the effect that its Intellectual Property infringes or will infringe
upon or conflict with the asserted rights of any other Person, and to the best
of the Company’s knowledge, there is no basis for any such claim (whether or not
pending or threatened). Except as set forth on Schedule
2.6, there are no outstanding options, licenses, or agreements of any
kind relating to the foregoing, nor is the Company bound by or a party to any
options, licenses, or agreements of any kind with respect to its Intellectual
Property. The Company is not obligated or under any liability
whatsoever to make any payments by way of royalties, fees or otherwise to any
owner of or licensor or other claimant to its Intellectual
Property. No claim is pending or, to the Company's knowledge,
threatened to the effect that the Intellectual Property is invalid or
unenforceable by the Company, and there is no basis for any such claim (whether
or not pending or, to the Company's knowledge, threatened).
2.7 Subsidiaries. The Company does
not own or control, directly or indirectly, any interest in any other company or
subsidiary and is not a participant in any joint venture, partnership or similar
arrangement.
2.8 Financial
Statements. The Company has
made available to the Investors its audited financial statements (including
balance sheet, income statement and statement of cash flows) as of December 31,
, 2007 and its unaudited financial statements as of March 31, 2008 and June 30,
2008 (collectively, the “Financial
Statements”). The Financial Statements (i) have been prepared
in accordance with generally accepted accounting principles, (ii) are true,
complete and correct and (iii) fairly present in all material respects the
financial condition and operating results of the Company as of the dates and for
the periods indicated therein, except that the unaudited statements are subject
to normal year-end audit adjustments.
2.9 Disclosure. No representation
or warranty of the Company contained in this Agreement, any certificate or
document furnished or to be furnished to the Investors at the Initial Closing or
the Financial Statements contains any untrue statement of a material fact or
omits to state a material fact necessary in order to make the statement
contained herein or therein not misleading in light of the circumstances under
which they were made.
3. Representations
and Warranties of the Investor. The Investor
hereby represents and warrants to the Company that:
3.1 Authorization. The Investor has
full power and authority to enter into this Agreement. This
Agreement, when executed and delivered by the Investor, assuming due execution
and delivery by the other parties hereto, will constitute a valid and legally
binding obligation of the Investor, enforceable in accordance with its terms,
except as limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance, and any other laws of general application
affecting enforcement of creditors’ rights generally, and as limited by laws
relating to the availability of a specific performance, injunctive relief, or
other equitable remedies.
3.2 Restricted
Securities. The Investor
understands that the Securities are “restricted securities” under applicable
U.S. federal and state securities laws and that, pursuant to these laws, the
Investor must hold the Securities indefinitely unless they
are registered with the Securities and Exchange Commission and qualified by
state authorities, or an exemption from such registration and qualification
requirements is available.
3.3 Indemnification. The Investor
agrees to indemnify and hold harmless the Company and each of its directors,
officers, agents, and affiliates from and against any and all loss, damage or
liability due to or arising out of a breach of any representation or warranty of
the Investor contained in this Agreement.
3.4 Purchase
for Own Account. The Securities will be acquired for investment for the
Investor's own account, not as a nominee or agent, and not with a view to the
public resale or distribution thereof within the meaning of the 1933 Act, and
the Investor has no present intention of selling, granting any participation in
or otherwise distributing the same. The investor has not been formed for the
specific purpose of acquiring the Securities.
3.5 Investment
Experience. The Investor understands that the acquisition of the
Securities involves substantial risk. The Investor has experience as an investor
in securities of companies and acknowledges that it is able to fend for itself,
can bear the economic risk of its
investment
and has such knowledge and experience in financial or business matters that it
is capable of evaluating the merits and risks of its investment and protecting
its own interests in connection with this investment.
3.6 Accredited
Investor Status. The Investor is an "accredited investor" within the
meaning of Regulation D and has suitably answered the Investor Questionnaire
attached as Schedule 1 hereto.
4. Miscellaneous.
4.1 Put Right
for Series D Warrants. Commencing on September 30, 2009 and
ending on March 31, 2010, the Investor shall have the right, at its sole option
and demand, immediately upon notice to the Company, to sell all or any portion
of the Series D Warrants, and/or the shares underlying thereunder to the extent
the Series D Warrants have been previously exercised, back to the Company for a
total consideration equal to thirty percent (30%) of the Note Purchase Price if
all such Warrants or underlying shares were “put” to the Company (with
pro-ration as applicable).
4.2 Registration
Rights. Each time the Company proposes to register any of its
securities under the Securities Act of 1933, as amended, whether for its own
account or for the account of holders of its securities or both (except with
respect to registration statements on Forms ▇-▇, ▇-▇ or any successor or similar
form or “Rule 145” transactions), it shall include all Common Stock Conversion
Shares as well as all of the shares of Common Stock underlying the Warrants
(collectively, "Conversion
Stock") in the registration initiated by the Company. If any
particular registration to be effected pursuant to this Section
4.2 shall be, in whole or in part, an underwritten public offering of
Common Stock for the account of the Company, the number of shares of Conversion
Stock to be included in such an underwriting on behalf of the Investor may be
reduced if, and to the extent that, the managing underwriter shall be of the
opinion (a written copy of which shall be delivered to the Investor) that the
inclusion of all of the shares requested to be included in such underwriting by
the Investor would materially and adversely affect the marketing of the Common
Stock to be sold by the Company under such registration
statement. The Company shall comply with all legal requirements to
maintain “evergreen” any registration statement that includes any Conversion
Stock for so long as any portion of the Note or any Warrants are outstanding or
any Conversion Stock is outstanding that has not yet been sold
thereunder.
4.4 Successors
and Assigns. This Agreement
may not be assigned by the Company without the prior written consent of Agile,
which consent shall not be unreasonably withheld. The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and permitted assigns of the
parties. Nothing in this Agreement, express or implied, is intended
to confer upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or liabilities
under or by reason of this Agreement, except as expressly provided in this
Agreement.
4.5 Governing
Law. This Agreement
and all acts and transactions pursuant hereto and the rights and obligations of
the parties hereto shall be governed, construed and interpreted in accordance
with the laws of the State of New York, without giving effect to
principles
of conflicts of law. Each of the parties hereto submits to the
personal jurisdiction of and each agrees that all proceedings relating hereto
shall be brought in federal or state courts located within Nassau or Suffolk
Counties in the State of New York.
4.6 Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed an
original and all of which together shall constitute one instrument.
4.7 Titles
and Subtitles. The titles and
subtitles used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
4.8 Notices. Any notice
required or permitted by this Agreement shall be in writing and shall be deemed
sufficient upon delivery, when delivered personally or by overnight courier or
sent by fax (upon customary confirmation of receipt), or 48 hours after being
deposited in the U.S. mail, as certified or registered mail, with postage
prepaid, addressed to the party to be notified at such party’s address as set
forth on the signature page hereto, or as subsequently modified by written
notice, and if to any Investor, with a copy to ▇▇▇▇▇▇▇▇▇ Ball ▇▇▇▇▇▇ ▇▇▇▇▇▇ and
▇▇▇▇▇▇▇▇▇▇, LLP, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
4.9 Confidentiality. This Agreement is
confidential, and none of its provisions or terms shall be disclosed to anyone
who is not an Investor or an officer or director of the Company or their agents,
advisers or legal counsel, unless required by law.
4.10 Entire
Agreement. This Agreement
constitutes the entire agreement between the parties hereto pertaining to the
subject matter hereof, and any and all other written or oral agreements relating
to the subject matter hereof existing between the parties hereto are expressly
canceled. This Agreement may be modified or amended only with the
written consent of all of the parties hereto.
[Remainder of Page
Intentionally Left Blank]
IN
WITNESS WHEREOF, the parties have duly executed this Securities Purchase
Agreement as of the date first written above.
By:
Name:
▇▇▇▇ ▇▇▇▇▇▇▇
Title:
CEO/President
Address:
▇▇▇▇ ▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ #▇▇▇
▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
AGILE
OPPORTUNITY FUND, LLC
By: AGILE
INVESTMENTS, LLC, Managing Member
By:___________________________________________
Name:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing
Member
Address:
▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
SCHEDULE
1
INVESTOR
SUITABILITY QUESTIONNAIRE
By
execution below, the undersigned acknowledges that the Company is relying upon
the accuracy and completeness of the representations contained herein in
complying with its obligations under applicable laws.
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1.
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The
undersigned acknowledges and represents as
follows:
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(a)
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That
the undersigned alone or with the assistance of the undersigned's own
professional advisor who is unaffiliated with and who is not compensated
by the Company or any of their affiliates has such knowledge and
experience in financial and business matters that the undersigned is
capable of evaluating the merits and risks of an investment in the
Company, has the capacity to protect the undersigned's own interests in
connection with a loan to the Company and has the net worth to undertake
such risks such that the undersigned could be reasonably assumed to have
the capacity to protect his own interests in connection with such
investment;
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(b)
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The
undersigned has been given reasonable opportunity to ask questions of, and
receive answers from, representatives of the Company concerning the terms
and conditions of this investment and to obtain any additional
information, to the extent reasonably available. The Company
has requested that the undersigned seek advice from its own legal counsel,
accountant or investment advisor on the risks associated with the
investment;
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(c)
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That
the undersigned realizes that the transferability of any Securities is
restricted and that a legend may be placed on any certificate representing
the Securities substantially to the following
effect:
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THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"). THE
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF A CURRENT AND EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT WITH RESPECT TO SUCH SECURITIES, OR AN
OPINION OF THE ISSUER'S COUNSEL TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED
UNDER THE 1933 ACT.
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2.
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The
undersigned acknowledges that the issuance of any securities in connection
with this investment are subject to the Federal securities laws of the
United States, and that, pursuant to the U.S. Federal securities laws and
state securities laws, the Securities may be acquired only by persons who
come within the definition of an “Accredited Investor” as that term is
defined in Rule 501(a) of Regulation D promulgated under the 1933 Act and
no more than thirty-five (35) non-Accredited Investors. Furthermore, if the undersigned
is an accredited investor, the undersigned has acknowledged that it
qualifies as an “Accredited Investor” by
checking the appropriate category below:
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{Securities
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FOR
INDIVIDUALS
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Category
I: ___
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The
undersigned is an individual (not a partnership, corporation, etc.) whose
individual net worth, or joint net worth with the undersigned's spouse,
presently exceeds U.S. $1,000,000.
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Explanation. In
calculation of net worth the undersigned may include equity in personal property
and real estate, including the undersigned's principal residence, cash,
short-term investments, stocks and securities. Equity in personal
property and real estate should be based on the fair market value of such
property less debt secured by such property.
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Category
II: ___
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The
undersigned is an individual (not a partnership, corporation, etc.) who
had an individual income in excess of U.S.$200,000 in 2006 and 2007, or
joint income with the undersigned's spouse in excess of $300,000 in 2006
and 2007, and has a reasonable expectation of reaching the same income
level in 2008.
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Category
III: ___
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The
undersigned otherwise meets the definition of "Accredited Investors" as
defined in Section 230.501(a) of the
Act.
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FOR
ENTITIES
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An
entity in which all of the equity owners are Accredited
Investors
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A
corporation, partnership, business trust, limited liability company or
Section 501 (c)(3) organization with total assets in excess of $5 million
that was not formed for the specific purpose of investing
herein.
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A
trust with total assets in excess of $5 million, which is not formed for
the specific purpose of investing herein, whose purpose is directed by a
person who has such knowledge and experience in financial and business
matters that he is capable of evaluating the merits and risks of this
prospective investment.
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A
broker-dealer registered pursuant to section 15 of the Securities Exchange
Act of 1934. A bank or savings and loan association as defined in Section
3(a) of the Securities Act of 1933, whether acting in its individual or
fiduciary capacity.
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An
insurance company as defined in section 2(13) of the Securities Act of
1933.
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An
investment company registered under the Investment Company Act of 1940 or
a business development company as defined in section 2(a)(48) of that Act
not formed for the specific purpose of investing
herein.
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A
plan established and maintained by a state, its political subdivisions or
any agency or instrumentality of a state or its political subdivisions,
for the benefit of its employees, if such plan has total assets in excess
of $5 million.
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An
employee benefit plan within the meaning of ERISA, provided, that the
investment decision is made by a plan fiduciary, as defined in section
3(21) of such Act, which is a bank, savings and loan association,
insurance company or registered investment advisor, or that the employee
benefit plan has total assets in excess of $5 million; or, if the plan
is
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{Securities
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self-directed,
with investment decisions made solely by persons that are Accredited
Investors.
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4.
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The
undersigned, if other than an individual, makes the following additional
representations:
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(a)
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The
undersigned was not organized for the specific purpose of acquiring the
investment; and
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(b)
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This
Agreement have been duly authorized by all necessary action on the part of
the undersigned, have been duly executed by an authorized representative
of the undersigned, and are legal, valid and binding obligations of the
undersigned enforceable in accordance with their respective
terms.
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Executed
this ____ day of September __________, 2008.
The
undersigned hereby represents he has read this entire Agreement.
____________________________
Signature
{Securities
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SCHEDULE
2.2
CAPITALIZATION
SCHEDULE
2.6
INTELLECTUAL
PROPERTY
[Redacted]
{Securities
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EXHIBIT
A
NEITHER
THIS NOTE NOR ANY SHARES OF STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR
UNDER THE SECURITIES LAWS OF ANY STATE. NEITHER THIS NOTE NOR ANY SHARES OF
STOCK ISSUABLE UPON CONVERSION OF THIS NOTE MAY BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT
WITH RESPECT TO THIS NOTE OR SHARES OF STOCK ISSUABLE UPON CONVERSION OF THIS
NOTE UNDER SUCH ACT UNLESS SUCH REGISTRATION IS NOT REQUIRED PURSUANT TO A VALID
EXEMPTION THEREFROM UNDER THE ACT.
THE ISSUE
PRICE OF THIS NOTE IS $150,000.00 (THE "ISSUE PRICE"). THE AMOUNT OF
ORIGINAL ISSUE DISCOUNT ON THIS NOTE IS $30,000.00 (THE “OID
AMOUNT”). THE ISSUE DATE OF THIS NOTE IS SEPTEMBER __,
2008.
Original
Issue Discount Term Secured Convertible Promissory Note
$180,000.00 September
__, 2008
FOR VALUE
RECEIVED, the undersigned DigitalPost Interactive, Inc.,
a Nevada corporation (referred to herein as "Borrower"
or the "Company"),
promises to pay to the order of Agile Opportunity Fund LLC,
its successors or assigns (the "Lender"),
the principal sum of One Hundred Eighty Thousand and 00/100 Dollars
($180,000.00) (the "Face
Amount") on September __, 2009 (the "Maturity
Date"), together with interest on the $150,000 Issue Price of this Note
at a rate equal to fifteen percent (15%) per annum calculated on the basis of a
360 day year (the "Interest
Rate"). Interest payments shall be due and payable on the last
day of each month prior to the Maturity Date and on the Maturity
Date. Notwithstanding any other provision hereof, interest paid or
becoming due hereunder and any other payments hereunder which may constitute
interest shall in no event exceed the maximum rate permitted by applicable
law.
Interest
due hereunder is payable in lawful money of the United States of America to the
Lender at the address set forth in that certain Securities Purchase Agreement
between the Borrower and the Lender of even date herewith, as amended from time
to time (the "Securities
Purchase Agreement") and pursuant to which this Note is
issued. The terms and conditions of the Securities Purchase Agreement
and all other loan documents executed in connection therewith ("Loan
Documents") are incorporated by reference herein and made a part
hereof. All capitalized terms not otherwise defined herein shall have
the respective meanings as set forth in the Securities Purchase
Agreement.
Section
1. Conversion.
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(a) At
any time from the original issue date hereof through the date that this Note is
paid in full, Lender shall have the right, in its sole discretion, to convert
the then outstanding Face Amount of this Note less the then as yet unamortized
portion of the OID Amount (the “Convertible
Principal Balance”) plus accrued but unpaid interest under this Note, in
whole or in part, into shares (each, a “Conversion
Share”) of Common Stock at a conversion price equal to $0.123 per
Conversion Share, subject to adjustment as provided in Section 2 herein (the
“Conversion
Price”).
(b) Lender
may convert this Note at the Conversion Price by the surrender of this Note
(properly endorsed) to the Company at the principal office of the Borrower,
together with the form of Notice of Conversion attached hereto as Annex A (a
“Notice of
Conversion”) duly completed, dated and executed, specifying therein the
principal amount of this Note and/or outstanding interest to be
converted. The “Conversion Date” shall be the date that such Notice
of Conversion and this Note is duly provided to Borrower hereunder (or, at
Lender's option, the next interest payment date with respect to Lender's
conversion of any scheduled interest payment). In the event that the
Lender shall specify a name or names other than that of the Lender to receive
any of the Conversion Shares issuable upon such exercise of the conversion
option, the Notice of Conversion also shall be accompanied by payment of all
transfer taxes payable upon the issuance of the Conversion Shares to such
specified person(s).
(c) On
the date of receipt by the Company of the duly completed, dated and executed
Notice of Conversion, this Note and applicable transfer taxes, if any, all in
accordance with Section 1(b) with respect to a conversion of any portion of this
Note, the Lender (and any person(s) receiving Conversion Shares in lieu of the
Lender) shall be deemed to have become the holder of record for all purposes of
the Conversion Shares to which such valid conversion relates.
(d) As
soon as practicable, but not in excess of five business days, after the valid
conversion of any portion of this Note, the Company, at the Company’s expense
(including the payment by Company of any applicable issuance and similar taxes,
but excluding the transfer taxes referred to in Section 1(b)), will cause to be
issued in the name of and delivered to the Lender (and/or such other person(s)
identified in the Notice of Conversion with respect to such conversion),
certificates evidencing the number of duly authorized, validly issued, fully
paid and non-assessable Conversion Shares to which the Lender (and/or such other
person(s) identified in such Notice of Conversion, shall be entitled to receive
upon the conversion), such certificates to be in such reasonable denominations
as Lender may request when delivering the Notice of Conversion.
(e) If
less than the entire Convertible Principal Balance of this Note is being
converted, the Company shall execute and deliver to the Lender a new replacement
Note (dated as of the date hereof) evidencing a face amount which is the
percentage of the original Face Amount equal to the portion of the Convertible
Principal Balance that has not been so converted.
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Section
2. Conversion Price
Adjustment.
(a) If
the Borrower, at any time while this Note is outstanding, (i) shall pay a stock
dividend or otherwise make a distribution or distributions on shares of its
Common Stock or any other equity or equity equivalent securities payable in
shares of Common Stock, (ii) subdivide outstanding shares of Common Stock into a
larger number of shares, (iii) combine (including by way of reverse stock split)
outstanding shares of Common Stock into a smaller number of shares, or (iv)
issue by reclassification of shares of the Common Stock any shares of capital
stock of the Borrower, then the Conversion Price shall be multiplied by a
fraction of which the numerator shall be the number of shares of Common Stock
(excluding treasury shares, if any) outstanding before such event and of which
the denominator shall be the number of shares of Common Stock (excluding
treasury shares, if any) outstanding after such event. Any adjustment made
pursuant to this paragraph shall become effective immediately after the record
date for the determination of stockholders entitled to receive such dividend or
distribution and shall become effective immediately after the effective date in
the case of a subdivision, combination or reclassification.
(b) In
case of any consolidation or merger of the Borrower with or into another
corporation or the conveyance of all or substantially all of the assets of the
Borrower to another corporation, this Note shall thereafter be convertible (to
the extent such conversion is permitted hereunder) into the number of shares of
stock or other securities or property to which a holder of the number of shares
of Common Stock of the Borrower deliverable upon conversion of this Note would
have been entitled upon such consolidation, merger or conveyance; and, in any
such case, appropriate adjustment shall be made in the application of the
provisions herein set forth with respect to the rights and interest thereafter
of the holders of this Note, to the end that the provisions set forth herein
shall be thereafter applicable, as nearly as reasonably may be, in relation to
any shares of stock or other property thereafter deliverable upon the conversion
of the Note.
Section
3. Reservation of
Stock. The Borrower covenants that it will at all times
reserve and keep available out of its authorized and unissued shares of Common
Stock solely for the purpose of issuance upon conversion of this Note as herein
provided, free from preemptive rights or any other actual contingent purchase
rights of persons other than the Lender, not less than such number of shares of
the Common Stock as shall be issuable upon the conversion of the outstanding
Face Amount of this Note and accrued and unpaid interest
hereunder. If at any time, the Company does not have available an
amount of authorized but unissued Common Stock or Common Stock held in treasury
necessary to satisfy any conversion of all amounts outstanding under this Note,
the Company shall call and hold a special meeting of its stockholders within 30
days of the occurrence of any shortfall in authorized shares for the purpose of
approving an increase in the number of shares of authorized Common Stock to an
amount sufficient to enable conversion all amounts outstanding under this Note,
subject in all respects to compliance with the requirements of Section 14 of the
Securities Exchange Act of 1934 to which the Borrower is subject. The
Board of Directors of the Company shall recommend that stockholders vote in
favor of increasing the number of authorized shares of Common Stock at any such
meeting. Each Member of the Board of Directors of the Company shall
also vote all of such Director’s voting securities of the Company in favor of
such increase in authorized shares. The Borrower
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covenants
that all shares of Common Stock that may be issuable upon conversion of this
Note shall, upon issue, be duly and validly authorized, issued and fully paid
and nonassessable. No consent of any other party and no consent,
license, approval or authorization of, or registration or declaration with, any
governmental authority, bureau or agency is required in connection with the
execution, delivery or performance by the Borrower, or the validity or
enforceability of this Note other than such as have been met or obtained. The
execution, delivery and performance of this Note and all other agreements and
instruments executed and delivered or to be executed and delivered pursuant
hereto or thereto or the securities issuable upon conversion of this will not
violate any provision of any existing law or regulation or any order or decree
of any court, regulatory body or administrative agency or the certificate of
incorporation or by-laws of the Borrower or any mortgage, indenture, contract or
other agreement to which the Borrower is a party or by which the Borrower or any
property or assets of the Borrower may be bound.
Section
4. No
Fractional Shares. Upon a conversion hereunder, the Borrower
shall not be required to issue stock certificates representing fractions of
shares of Common Stock, and in lieu of any fractional shares which would
otherwise be issuable, the Borrower shall issue the next highest whole number of
shares of Common Stock, as the case may be.
Section
5. Redemption.
(a) Mandatory
Redemption. If at any time while this Note shall be
outstanding, the Company shall consummate: (i) a “going-private” transaction
whereby the Common Stock shall thereafter cease to be registered under the
Exchange Act; (ii) a Sale of the Company; or (iii) the closing of a financing in
excess of five million dollars ($5,000,000), then the Company shall deliver a
written notice to the Lender of the pending consummation of any transaction
described in clauses (i)-(iii) of this Section 5 (each, a "Liquidity
Event") fifteen (15) days prior thereto and shall redeem this Note
immediately following the closing of a Liquidity Event by paying the applicable
Redemption Price. As used herein, "Redemption
Price" shall equal the accrued but unpaid interest outstanding under this
Note, plus: (i) if the effective date or closing date, as applicable, of the
Liquidity Event giving rise to such repayment obligation (the “Repayment
Date”) is prior to the six (6) month anniversary of the date hereof, one
hundred ten percent (110%) of the Face Amount of this Note; or (ii) if the
Repayment Date is on or after the six (6) month anniversary of the date hereof,
one hundred fifteen percent (115%) of the Face Amount of this
Note. The Borrower shall deliver to the Lender the Redemption Price
on the Repayment Date in immediately available funds. For the purpose
of clarification, after delivery of a notice of a Liquidity Event as provided
for in this Section, the Lender shall continue to be entitled to effectuate
conversions as contemplated under this Note until such time as the redemption
under this Section is consummated.
(b) Voluntary
Prepayment. At any time while
the Note shall be outstanding, the Company may deliver a written notice of
prepayment to the Lender of its intention to prepay the Note in full, or in
part, fifteen (15) days prior thereto and shall redeem such portion of the Note
as indicated in the notice by paying the applicable Redemption Price
above. The date of the notice in this instance is the Repayment
Date. For the purpose of clarification, after delivery of a notice of
prepayment as provided for in this Section, the Lender shall continue to be
entitled to
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effectuate
conversions as contemplated under this Note until such time as the redemption
under this Section is consummated.
Section
6. Transferability. This
Note and any of the rights granted hereunder are freely transferable by the
Lender, in its sole discretion, subject to federal and state securities law
restrictions, if any.
Section
7. Event of
Default.
(a) An
"Event of Default", wherever used herein, means any one of the following events
(whatever the reason and whether it shall be voluntary or involuntary or
effected by operation of law or pursuant to any judgment, decree or order of any
court, or any order, rule or regulation of any administrative or governmental
body):
(i) Any
default in the payment of the principal of, interest on or other charges in
respect of this Note, as and when the same shall become due and payable (whether
the Maturity Date or by acceleration or otherwise);
(ii) The
Borrower or any subsidiary shall fail to observe or perform any other material
covenant, agreement or warranty contained in, or otherwise commit any breach or
default of any provision of this Note or any Loan Document to which it is a
party;
(iii) The
Borrower or any subsidiary shall commence, or there shall be commenced against
the Borrower or any Subsidiary any applicable bankruptcy or insolvency laws as
now or hereafter in effect or any successor thereto, or the Borrower or any
Subsidiary commences any other proceeding under any reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or
similar law of any jurisdiction whether now or hereafter in effect relating to
the Borrower or Subsidiary or there is commenced against the Borrower or
Subsidiary any such bankruptcy, insolvency or other proceeding which remains
undismissed for a period of 60 days; or the Borrower or Subsidiary is
adjudicated insolvent or bankrupt; or any order of relief or other order
approving any such case or proceeding is entered; or the Borrower or Subsidiary
suffers any appointment of any custodian, private or court appointed receiver or
the like for it or any substantial part of its property which continues
undischarged or unstayed for a period of 60 days; or the Borrower or Subsidiary
makes a general assignment for the benefit of creditors; or the Borrower or
Subsidiary shall fail to pay, or shall state that it is unable to pay, or shall
be unable to pay, its debts generally as they become due; or the Borrower or
Subsidiary shall by any act or failure to act expressly indicate its consent to,
approval of or acquiescence in any of the foregoing; or any corporate or other
action is taken by the Borrower or Subsidiary for the purpose of effecting any
of the foregoing;
(iv) The
Borrower or any subsidiary shall default in any of its obligations under any
other note or any mortgage, credit agreement or other facility, indenture
agreement, factoring agreement or other instrument under which there may be
issued, or by which there may be secured or evidenced any indebtedness for
borrowed money or money due under any leasing or factoring arrangement of the
Borrower, whether such indebtedness now exists or shall hereafter be created and
such default shall result in such indebtedness becoming or
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being
declared due and payable prior to the date on which it would otherwise become
due and payable.
(b) Following
an Event of Default, the Interest Rate shall increase to twenty percent (20%)
per annum (but not exceeding the maximum rate permitted by law) immediately
following such Event of Default. Upon
the occurrence of an Event of Default hereunder, the entire Face Amount of this
Note together with any accrued but unpaid interest shall automatically become
due and payable. The failure of the Lender to exercise any of its
rights hereunder in any particular instance shall not constitute a waiver of the
same or of any other right in that or any subsequent instance with respect to
the Lender or any subsequent holder. The Lender need not provide and
the Borrower hereby waives any presentment, demand, protest or other notice of
any kind, and the Lender may immediately and without expiration of any grace
period enforce any and all of its rights and remedies hereunder and all other
remedies available to it under applicable law.
Section
8. Registration
Rights. The Lender is entitled to certain registration rights
with respect to the Common Stock issuable upon conversion of this Note as set
forth in the Securities Purchase Agreement.
Section
9. Notices. Any
and all notices, requests, documents or other communications or deliveries
required or permitted to be given or delivered hereunder shall be delivered in
accordance with the notice provisions of the Securities Purchase
Agreement.
Section
10. Governing Law; Waiver of
Jury Trial. This Note and the provisions hereof are to be
construed according to and are governed by the laws of the State of New York,
without regard to principles of conflicts of laws thereof. Borrower
agrees that the New York State Supreme Court located in the County of Nassau,
State of New York shall have exclusive jurisdiction in connection with any
dispute concerning or arising out of this Note, the Loan Documents, or otherwise
relating to the parties relationship. In any action, lawsuit or
proceeding brought to enforce or interpret the provisions of this Note, the Loan
Documents and/or arising out of or relating to any dispute between the parties,
the Lender shall be entitled to recover all of his or its costs and expenses
relating collection and enforcement of this Note (including without limitation,
reasonable attorney’s fees and disbursements) in addition to any other relief to
which the Lender may be entitled.
THE
BORROWER HEREBY WAIVES TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR
COUNTERCLAIM, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, ARISING OUT OF
OR IN ANY WAY RELATING TO THIS NOTE.
Section 11. Successors and
Assigns. Subject to applicable securities laws, this Note and
the rights and obligations evidenced hereby shall inure to the benefit of and be
binding upon the successors of the Company and the successors and assigns of
Lender.
Section 12. Amendment. This
Note may be modified or amended or the provisions hereof waived only with the
written consent of the Lender and the Company.
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Section 13. Severability. Wherever
possible, each provision of this Note shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this Note
shall be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Note.
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IN
WITNESS WHEREOF, the Borrower has caused this Note to be duly executed by a duly
authorized officer as of the date first above indicated.
By: [
Name:
▇▇▇▇ ▇▇▇▇▇▇▇
Title: CEO/President
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ANNEX
A
NOTICE OF
CONVERSION
To Be
Executed by the Lender
in Order
to Convert Promissory Note
The
undersigned Lender hereby elects to convert $__________ principal (equal to
$______ Face Amount less, if Conversion Date is prior to Maturity Date, $____
unamortized OID Amount, capitalized terms used as defined in the Note) and
$_____ interest currently outstanding and owed under the Original Issue Discount
Term Secured Convertible Promissory Note issued to Agile Opportunity Fund, LLC at
a Conversion Price of $___ (the “Note”)
and to purchase ___________ shares of Common Stock of DigitalPost Interactive, Inc.
issuable upon conversion of such Note, and requests that certificates for such
securities shall be issued in the name of:
___________________________________________________________
(please
print or type name and address)
___________________________________________________________
(please
insert social security or other identifying number)
and be
delivered as follows:
___________________________________________________________
please
print or type name and address)
___________________________________________________________
(please
insert social security or other identifying number)
Lender
Name:_______________________________________________
By:________________________________________________________
Name:
Title:
Conversion
Date:___________________________________________
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EXHIBIT
B-1
WARRANT
(SERIES C)
September __, 2008
THIS
WARRANT, AND ALL SHARES OF STOCK ISSUABLE UNDER THIS WARRANT, HAVE BEEN AND WILL
BE ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("THE ACT"). SUCH SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.
These are
Series C Warrants issued pursuant to the Securities Purchase Agreement dated as
of September __, 2008 between DigitalPost, Inc., a Nevada
corporation (the “Company”) and the
Investor identified below (the “Securities Purchase
Agreement”). This Warrant is entitled to certain registration
rights pursuant to Section 4.2 of the Securities Purchase Agreement. The number
of shares issuable upon exercise of this Warrant shall be subject to adjustment
in accordance with the terms hereof.
THIS
CERTIFIES THAT, for value received, AGILE OPPORTUNITY FUND, LLC
(the "Investor", “Lender” or the “Holder”), or its
permitted assigns is entitled, subject to the terms and conditions of this
Warrant, at any time following the Effective Date and before 5:30 P.M. New York
City time on the Expiration Date, to purchase from the Company, 750,000 shares of Common Stock
(such shares and all other shares issued or issuable pursuant to this Warrant
referred to hereinafter as "Warrant Stock"). The
initial "Purchase
Price" per share shall be equal to $0.123 for an aggregate
Purchase Price for all Warrant Stock equal to $92,250.00.
1. DEFINITIONS: As used in this
Warrant, the following terms shall have the following respective
meanings:
“Affiliate” when used
with respect to any Person, shall mean (a) any other Person which, directly
or indirectly, controls or is controlled by or is under common control with such
Person, and (b) any executive officer or director of such Person and any
executive officer, director or general partner of the other Person which
controls such Person. For the purposes of this definition, "control"
(including the correlative meanings of the terms "controlling", "controlled by"
and "under common control with"), with respect to any Person, shall mean
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
“Common Stock” shall
mean the common stock, $.001 par value, of the Company.
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“Effective Date" shall
mean the date hereof.
"Expiration Date"
shall mean the fifth anniversary of the date hereof.
"Fair Market Value" of
a share of Warrant Stock as of a particular date shall mean:
(a) If
traded on a securities exchange or the Nasdaq National Market, the Fair Market
Value shall be deemed to be the average of the closing price of the Warrant
Stock on such exchange or market over the five (5) business days ending on the
day immediately prior to the applicable date of valuation;
(b) If
actively traded over-the-counter, the Fair Market Value shall be deemed to be
the average of the closing bid prices over the 30-day period ending on the day
immediately prior to the applicable date of valuation; and
(c) If
there is no active public market, the Fair Market Value shall be the value
thereof, as agreed upon by the Company and the Holder; provided, however, that if the
Company and the Holder cannot agree on such value, such value shall be
determined by an independent valuation firm experienced in valuing businesses
such as the Company and jointly selected in good faith by the Company and the
Holder. Fees and expenses of the valuation firms shall be paid solely by the
Company.
"Holder" shall mean
the Investor, its successors or assigns.
"Notes" shall mean the
Notes as defined in and issued pursuant to the Securities Purchase
Agreement.
"Person" shall mean
any individual, corporation, partnership, limited liability company, trust or
other entity or organization, including any governmental authority or political
subdivision thereof.
"Registered Holder"
shall mean any Holder in whose name this Warrant is registered upon the books
and records maintained by the Company.
"SEC" shall mean the
United States Securities and Exchange Commission.
"Warrant" shall mean
this Warrant and any warrant delivered in substitution or exchange therefor as
provided herein.
2. EXERCISE
OF WARRANT.
2.1 Payment. Subject
to compliance with the terms and conditions of this Warrant and applicable
securities laws, this Warrant may be exercised, in whole or in part at any time
or from time to time, from and after the Effective Date and on or before the
Expiration Date by delivery (including, without limitation, delivery by
facsimile) of the form of Notice of Exercise attached
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hereto as
Exhibit 1 (the
"Notice of
Exercise"), duly executed by the Holder, to the Company at its then
principal office, and as soon as practicable after such date,
surrendering:
(a) this
Warrant at the principal office of the Company, and
(b) payment
in cash, by check or by wire transfer of an amount equal to the product obtained
by multiplying the number of shares of Warrant Stock being purchased upon such
exercise by the then effective Purchase Price (the "Exercise
Amount").
Notwithstanding the foregoing, in the
event that the Company becomes subject to the reporting requirements under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), then at no
time thereafter shall Holder, together with any “affiliates” of Holder (as
defined in the Securities and Exchange Act of 1934, as amended) “beneficially
own” (as defined in the Exchange Act) in excess of Four and 99/100 percent
(4.99%) of the outstanding shares of Common Stock of the
Company. Accordingly, in the event that the Company becomes subject
to the reporting requirements under the Exchange Act, Holder may not exercise
any portion of this Warrant if, as a result of such exercise, Holder (together
with Holder’s affiliates) would beneficially own in excess of Four and 99/100
percent (4.99%) of the outstanding shares of Common Stock of the Company,
inclusive of shares of Common Stock beneficially owned by the Holder and
acquired other than through exercise of this Warrant, without the prior written
consent of the Company.
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2.2 Net Issue
Exercise. In lieu of the payment methods set forth in Section
2.1(b) above, the Holder may elect to exchange all or some of the Warrant for
shares of Warrant Stock equal to the value of the amount of the Warrant being
exchanged on the date of exchange. If the Holder elects to exchange this Warrant
as provided in this Section 2.2, the Holder shall tender to the Company the
Warrant for the amount being exchanged, along with written notice of the
Holder's election to exchange some or all of the Warrant, and the Company shall
issue to the Holder the number of shares of the Warrant Stock computed using the
following formula:
X = Y (A-B)
A
Where:
X = the
number of shares of Warrant Stock to be issued to the Holder;
Y = the
total number of shares of Warrant Stock as to which this Warrant is being
exercised;
A = the
Fair Market Value of one share of Warrant Stock; and
B = the
Purchase Price of one share of Warrant Stock (as adjusted to the date of such
calculation).
All
references herein to an "exercise" of the Warrant shall include an exchange
pursuant to this Section 2.2.
The
provisions in this Section 2.2 shall not be available during the effectiveness
of the registration statement covering all Warrant Stock referred to in Section
4.2 of the Securities Purchase Agreement, but only so long as there does not
exist any Event of Default under any of the Notes.
2.3 "Easy Sale"
Exercise In lieu of the payment methods set forth in Section
2.1 (b) above, when permitted by law and applicable regulations (including
exchange, Nasdaq and NASD rules and including that all shares so issued will be
deemed to be fully paid, non-assessable and properly listed or admitted for
trading), the Holder may pay the Purchase Price through a "same day sale"
commitment from the Holder (and if applicable a broker-dealer that is a member
of the National Association of Securities Dealers (a "NASD Dealer')), whereby
the Holder irrevocably elects to exercise this Warrant and to sell a portion of
the shares so purchased to pay for the Purchase Price and the Holder (or, if
applicable, the NASD Dealer) commits upon sale (or, in the case of the NASD
Dealer, upon receipt) of such shares to forward the Purchase Price directly to
the Company. The Company does not have an “easy sale” process
established with a broker-dealer; however, the Company will use its best efforts
to establish such a process within six (6) months of the date of this
warrant.
2.4 Stock Certificates;
Fractional Shares. As soon as practicable on or after any date
of exercise of this Warrant pursuant to this Section 2, the Company shall issue
and deliver to the
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Person or
Persons entitled to receive the same a certificate or certificates for the
number of whole shares of Warrant Stock issuable upon such exercise, together
with cash in lieu of any fraction of a share equal to such fraction of the
current Fair Market Value of one whole share of Warrant Stock as of the date of
exercise of this Warrant. No fractional shares or scrip representing fractional
shares shall be issued upon an exercise of this Warrant.
2.5 Partial Exercise; Effective
Date of Exercise. In case of any partial exercise of this
Warrant, the Company shall cancel this Warrant upon surrender hereof and shall
execute and deliver a new Warrant of like tenor and date for the balance of the
shares of Warrant Stock purchasable hereunder. This Warrant shall be deemed to
have been exercised immediately prior to the close of business on the date of
its surrender for exercise as provided above. The Person entitled to receive the
shares of Warrant Stock issuable upon exercise of this Warrant shall be treated
for all purposes as the holder of record of such shares as of the close of
business on the date the Holder is deemed to have exercised this
Warrant.
2.6 Purchase Price
Adjustment.
(a) If
the Company shall effect a subdivision of the outstanding Common Stock, the
Purchase Price then in effect immediately before such subdivision shall be
proportionately decreased. If the Company shall combine the
outstanding shares of Common Stock, the Purchase Price then in effect
immediately before the combination shall be proportionately
increased. If the Company shall make or issue a dividend or other
distribution payable in securities, then and in each such event provision shall
be made so that the holder of this Warrant shall receive upon exercise hereof,
in addition to the number of shares of Common Stock receivable thereupon, the
amount of securities that the holder of this Warrant would have received had
this Warrant been exercised for Common Stock on the date of such event and had
such holder thereafter during the period from the date of such event to and
including the date of exercise of this Warrant retained such securities
receivable by such holder as aforesaid during such period, giving effect to all
adjustments called for during such period under this paragraph. If
the Company shall reclassify its Common Stock (including any reclassification in
connection with a consolidation or merger in which the Company is the surviving
corporation), then and in each such event provision shall be made so that such
holder shall receive upon exercise hereof the amount of such reclassified Common
Stock that such holder would have received had this Warrant been exercised for
Common Stock immediately prior to such reclassification and had such holder
thereafter, during the period from the date of such event to and including the
date of exercise of this Warrant, retained such reclassified Common Stock,
giving effect to all adjustments called for during such period under this
paragraph with respect to the rights of the holder of this Warrant.
(b) Whenever
the Purchase Price shall be adjusted as provided in this Section 2.6, the
Company shall forthwith provide notice of such adjustment to the holder of this
Warrant together with a statement, certified by the chief financial officer of
the Company, showing in detail the facts requiring such adjustment and the
Purchase Price that shall be in effect after such
adjustment. Notwithstanding the foregoing, no adjustment in the
Purchase Price shall be required unless such adjustment would require a change
of at least 1% in such Purchase Price; provided, however, that any
adjustments which by reason of this paragraph (b) are not
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required
to be made shall be carried forward and taken into account in any subsequent
adjustment.
(c) In
case of any consolidation or merger of the Company with or into another
corporation or the conveyance of all or substantially all of the assets of the
Company to another corporation, this Warrant shall thereafter be exercisable (to
the extent such exercise is permitted hereunder) into the number of shares of
stock or other securities or property to which a holder of the number of shares
of Common Stock of the Company deliverable upon exercise of this Warrant would
have been entitled upon such consolidation, merger or conveyance; and, in any
such case, appropriate adjustment shall be made in the application of the
provisions herein set forth with respect to the rights and interest thereafter
of the holder of this Warrant, to the end that the provisions set forth herein
shall be thereafter applicable, as nearly as reasonably may be, in relation to
any shares of stock or other property thereafter deliverable upon the exercise
of the this Warrant.
3. VALID ISSUANCE;
TAXES. All shares of Warrant Stock issued upon the exercise of
this Warrant shall be validly issued, fully paid and non-assessable; provided
that the Company shall pay all taxes and other governmental charges that may be
imposed in respect of the issue or delivery thereof. The Company shall not be
required to pay any tax or other charge imposed in connection with any transfer
involved in the issuance of any certificate for shares of Warrant Stock in any
name other than that of the Registered Holder of this Warrant, and in such case
the Company shall not be required to issue or deliver any stock certificate or
security until such tax or other charge has been paid, or it has been
established to the Company's reasonable satisfaction that no tax or other charge
is due.
4. LOSS OR MUTILATION. Upon
receipt of evidence reasonably satisfactory to the Company of the ownership of
and the loss, theft, destruction or mutilation of this Warrant, and of indemnity
reasonably satisfactory to it, and (in the case of mutilation) upon surrender
and cancellation of this Warrant, the Company shall execute and deliver in lieu
thereof a new Warrant of like tenor as the lost, stolen, destroyed or mutilated
Warrant.
5. RESERVATION OF WARRANT STOCK .
Notwithstanding anything to the contrary in this Agreement, Holder acknowledges
that as of the date hereof, the number of authorized but unissued (and otherwise
unreserved) shares of Common Stock is less than the minimum required to honor
conversion requests hereunder (the “Share Deficiency”). The Company
agrees to take action as soon as practicably possible to remedy the Share
Deficiency. After remedy of the Share Deficiency, the Company hereby
covenants that at all times there shall be reserved for issuance and delivery
upon exercise of this Warrant such number of shares of Warrant Stock, Common
Stock or other shares of capital stock of the Company as are from time to time
issuable upon exercise of this Warrant and, from time to time, will take all
steps necessary to amend its Articles of Incorporation to provide sufficient
reserves of shares of Warrant Stock issuable upon exercise of this Warrant. All
such shares shall be duly authorized, and when issued upon such exercise, shall
be validly issued, fully paid and non-assessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale and
free and clear of all preemptive rights, except encumbrances or restrictions
arising under federal or state securities laws. Issuance of this Warrant shall
constitute full authority to the Company's officers who are
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charged
with the duty of executing stock certificates to execute and issue the necessary
certificates for shares of Warrant Stock upon the exercise of this
Warrant.
6. RESTRICTIONS ON TRANSFER. The
Holder, by acceptance hereof, agrees that, absent an effective registration
statement filed with the SEC under the Securities Act of 1933, as amended (the
"Securities Act"), covering the disposition or sale of this Warrant or the
Warrant Stock issued or issuable upon exercise hereof, as the case may be, and
registration or qualification under applicable state securities laws, such
Holder will not sell, transfer, pledge, or hypothecate any or all such Warrants
or Warrant Stock, as the case may be, unless either (a) the Company has received
an opinion of counsel, in form and substance reasonably satisfactory to the
Company, to the effect that such registration is not required in connection with
such disposition or (b) the sale of such securities is made pursuant to SEC Rule
144.
7. NOTICE. All notices
and other communications from the Company to the Holder shall be sent to the
Holder at the address for such Holder set forth on the Company’s books and
records.
8. HEADINGS; SECTION
REFERENCE. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof. All Section references herein are references, to Sections of
this Warrant unless specified otherwise.
9. LAW GOVERNING. .
This Warrant shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflict of laws
provisions. The parties agree that the New York State Supreme Court
located in the County of Nassau, State of New York shall have exclusive
jurisdiction in connection with any dispute concerning or arising out of this
Warrant, or otherwise relating to the parties relationship. In any
action, lawsuit or proceeding brought to enforce or interpret the provisions of
this Warrant and/or arising out of or relating to any dispute between the
parties, the prevailing party with respect to each specific issue in a matter
shall be entitled to recover all of his or its costs and expenses relating to
such issue (including without limitation, reasonable attorney’s fees and
disbursements) in addition to any other relief to which such party may be
entitled..
10. NO IMPAIRMENT. The Company
will not, by amendment of its Articles of Incorporation or bylaws, or through
reorganization, consolidation, merger, dissolution, issue or sale of securities,
sale of assets or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Registered Holder of this Warrant against impairment. Without
limiting the generality of the foregoing, the Company: (a) will not increase the
par value of any shares of stock issuable upon the exercise of this Warrant
above the amount payable therefor upon such exercise and (b) will take all such
action as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and nonassessable shares of Warrant Stock upon
exercise of this Warrant.
11. SEVERABILITY. If any term,
provision, covenant or restriction of this Warrant is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the
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terms,
provisions, covenants and restrictions of this Warrant shall remain in full
force and effect and shall in no way be affected, impaired or
invalidated.
12. COUNTERPARTS. For the
convenience of the parties, any number of counterparts of this Warrant may be
executed by the parties hereto and each such executed counterpart shall be, and
shall be deemed to be, an original instrument.
13. NO INCONSISTENT AGREEMENTS.
The Company will not on or after the date of this Warrant enter into any
agreement with respect to its securities which is inconsistent with the rights
granted to the Holder or otherwise conflicts with the provisions
hereof.
14. SATURDAYS, SUNDAYS AND
HOLIDAYS. If the Expiration Date falls on a Saturday, Sunday or legal
holiday, the Expiration Date shall automatically be extended until 5:30 P.M. the
next business day.
[Remainder
of Page Intentionally Left Blank’ Signature Page Follows]
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IN WITNESS WHEREOF, the
undersigned duly authorized representative of the Company has executed this
Series C Warrant as of the day and date first written above.
By: [Missing
Graphic Reference]
Name:
▇▇▇▇ ▇▇▇▇▇▇▇
Title:
CEO/President
{Securities
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EXHIBIT
1
NOTICE
OF EXERCISE
(To
be executed upon exercise of Warrant)
The
undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, ___ shares of Warrant
Stock:
|
|
1.
|
Tenders
herewith payment of the exercise price in full in the form of cash or a
certified or official bank check in same-day funds in the amount of
$_______ for __________ such
securities.
|
|
|
2.
|
Elects
the Net Issue Exercise option pursuant to Section 2.2 of the Warrant, and
accordingly requests delivery of a net of _________ of such securities,
according to the following
calculation:
|
|
|
X =
Y
(A-B)
|
( )=
( )
[( ) -
( )]
|
A (_______)
Where:
X = the
number of shares of Warrant Stock to be issued to the Holder;
Y = the
total number of shares of Warrant Stock as to which this Warrant is being
exercised;
A = the
Fair Market Value of one share of the Warrant Stock; and
B = the
Purchase Price of one share of Warrant Stock.
|
|
3.
|
Elects
the Easy Sale Exercise option pursuant to Section 2.3 of the Warrant, and
accordingly requests delivery of a net of ________ of such securities to
the brokerage firm identified below and attaches the agreement of said
firm to pay to the Company out of the proceeds of sale the purchase price
of the Warrant Shares.
|
Unless
Easy Sale Exercise is elected above, in which case the Warrant Shares shall be
issued to the Warrant Holder’s account at said brokerage firm, please issue a
certificate or certificates for such securities in the name of, and pay any cash
for any fractional share to (please print name, address and social security
number):
Name: ______________________________________
Address: ______________________________________
Signature: ______________________________________
Date: ______________________________________
{Securities
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Note: The
above signature should correspond exactly with the name on the first page of
this Warrant Certificate or with the name of the assignee appearing in the
assignment form below.
If said
number of shares shall not be all the shares purchasable under the within
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the shares purchasable thereunder
rounded up to the next higher whole number of shares.
{Securities
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EXHIBIT
B-2
WARRANT
(SERIES D)
September __, 2008
THIS
WARRANT, AND ALL SHARES OF STOCK ISSUABLE UNDER THIS WARRANT, HAVE BEEN AND WILL
BE ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("THE ACT"). SUCH SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT
AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.
These are
Series D Warrants issued pursuant to the Securities Purchase Agreement dated as
of September __, 2008 between DigitalPost, Inc., a Nevada
corporation (the “Company”) and the
Investor identified below (the “Securities Purchase
Agreement”). This Warrant is subject to a certain Put Right
pursuant to Section 4.1 of the Securities Purchase Agreement and is entitled to
certain registration rights pursuant to Section 4.2 of the Securities Purchase
Agreement. The number of shares issuable upon exercise of this Warrant shall be
subject to adjustment in accordance with the terms hereof.
THIS
CERTIFIES THAT, for value received, AGILE OPPORTUNITY FUND, LLC
(the "Investor", “Lender” or the “Holder”), or its
permitted assigns is entitled, subject to the terms and conditions of this
Warrant, at any time following the Effective Date and before 5:30 P.M. New York
City time on the Expiration Date, to purchase from the Company, 750,000 shares of Common Stock
(such shares and all other shares issued or issuable pursuant to this Warrant
referred to hereinafter as "Warrant Stock"). The
initial "Purchase
Price" per share shall be equal to $0.15 for an aggregate
Purchase Price for all Warrant Stock equal to $112,500.00.
1. DEFINITIONS: As used in this
Warrant, the following terms shall have the following respective
meanings:
“Affiliate” when used
with respect to any Person, shall mean (a) any other Person which, directly
or indirectly, controls or is controlled by or is under common control with such
Person, and (b) any executive officer or director of such Person and any
executive officer, director or general partner of the other Person which
controls such Person. For the purposes of this definition, "control"
(including the correlative meanings of the terms "controlling", "controlled by"
and "under common control with"), with respect to any Person, shall mean
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
“Common Stock” shall
mean the common stock, $.001 par value, of the Company.
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“Effective Date" shall
mean the date hereof.
"Expiration Date"
shall mean the fifth anniversary of the date hereof.
"Fair Market Value" of
a share of Warrant Stock as of a particular date shall mean:
(a) If
traded on a securities exchange or the Nasdaq National Market, the Fair Market
Value shall be deemed to be the average of the closing price of the Warrant
Stock on such exchange or market over the five (5) business days ending on the
day immediately prior to the applicable date of valuation;
(b) If
actively traded over-the-counter, the Fair Market Value shall be deemed to be
the average of the closing bid prices over the 30-day period ending on the day
immediately prior to the applicable date of valuation; and
(c) If
there is no active public market, the Fair Market Value shall be the value
thereof, as agreed upon by the Company and the Holder; provided, however, that if the
Company and the Holder cannot agree on such value, such value shall be
determined by an independent valuation firm experienced in valuing businesses
such as the Company and jointly selected in good faith by the Company and the
Holder. Fees and expenses of the valuation firms shall be paid solely by the
Company.
"Holder" shall mean
the Investor, its successors or assigns.
"Notes" shall mean the
Notes as defined in and issued pursuant to the Securities Purchase
Agreement.
"Person" shall mean
any individual, corporation, partnership, limited liability company, trust or
other entity or organization, including any governmental authority or political
subdivision thereof.
"Registered Holder"
shall mean any Holder in whose name this Warrant is registered upon the books
and records maintained by the Company.
"SEC" shall mean the
United States Securities and Exchange Commission.
"Warrant" shall mean
this Warrant and any warrant delivered in substitution or exchange therefor as
provided herein.
2. EXERCISE
OF WARRANT.
2.1 Payment. Subject
to compliance with the terms and conditions of this Warrant and applicable
securities laws, this Warrant may be exercised, in whole or in part at any time
or from time to time, from and after the Effective Date and on or before the
Expiration Date by delivery (including, without limitation, delivery by
facsimile) of the form of Notice of Exercise attached
{Securities
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hereto as
Exhibit 1 (the
"Notice of
Exercise"), duly executed by the Holder, to the Company at its then
principal office, and as soon as practicable after such date,
surrendering:
(a) this
Warrant at the principal office of the Company, and
(b) payment
in cash, by check or by wire transfer of an amount equal to the product obtained
by multiplying the number of shares of Warrant Stock being purchased upon such
exercise by the then effective Purchase Price (the "Exercise
Amount").
Notwithstanding the foregoing, in the
event that the Company becomes subject to the reporting requirements under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), then at no
time thereafter shall Holder, together with any “affiliates” of Holder (as
defined in the Securities and Exchange Act of 1934, as amended) “beneficially
own” (as defined in the Exchange Act) in excess of Four and 99/100 percent
(4.99%) of the outstanding shares of Common Stock of the
Company. Accordingly, in the event that the Company becomes subject
to the reporting requirements under the Exchange Act, Holder may not exercise
any portion of this Warrant if, as a result of such exercise, Holder (together
with Holder’s affiliates) would beneficially own in excess of Four and 99/100
percent (4.99%) of the outstanding shares of Common Stock of the Company,
inclusive of shares of Common Stock beneficially owned by the Holder and
acquired other than through exercise of this Warrant, without the prior written
consent of the Company.
[Remainder
of Page Intentionally Left Blank]
{Securities
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2.2 Net Issue
Exercise. In lieu of the payment methods set forth in Section
2.1(b) above, the Holder may elect to exchange all or some of the Warrant for
shares of Warrant Stock equal to the value of the amount of the Warrant being
exchanged on the date of exchange. If the Holder elects to exchange this Warrant
as provided in this Section 2.2, the Holder shall tender to the Company the
Warrant for the amount being exchanged, along with written notice of the
Holder's election to exchange some or all of the Warrant, and the Company shall
issue to the Holder the number of shares of the Warrant Stock computed using the
following formula:
X = Y (A-B)
A
Where:
X = the
number of shares of Warrant Stock to be issued to the Holder;
Y = the
total number of shares of Warrant Stock as to which this Warrant is being
exercised;
A = the
Fair Market Value of one share of Warrant Stock; and
B = the
Purchase Price of one share of Warrant Stock (as adjusted to the date of such
calculation).
All
references herein to an "exercise" of the Warrant shall include an exchange
pursuant to this Section 2.2.
The
provisions in this Section 2.2 shall not be available during the effectiveness
of the registration statement covering all Warrant Stock referred to in Section
4.2 of the Securities Purchase Agreement, but only so long as there does not
exist any Event of Default under any of the Notes.
2.3 "Easy Sale"
Exercise In lieu of the payment methods set forth in Section
2.1 (b) above, when permitted by law and applicable regulations (including
exchange, Nasdaq and NASD rules and including that all shares so issued will be
deemed to be fully paid, non-assessable and properly listed or admitted for
trading), the Holder may pay the Purchase Price through a "same day sale"
commitment from the Holder (and if applicable a broker-dealer that is a member
of the National Association of Securities Dealers (a "NASD Dealer')), whereby
the Holder irrevocably elects to exercise this Warrant and to sell a portion of
the shares so purchased to pay for the Purchase Price and the Holder (or, if
applicable, the NASD Dealer) commits upon sale (or, in the case of the NASD
Dealer, upon receipt) of such shares to forward the Purchase Price directly to
the Company. The Company does not have an “easy sale” process
established with a broker-dealer; however, the Company will use its best efforts
to establish such a process within six (6) months of the date of this
warrant.
2.4 Stock Certificates;
Fractional Shares. As soon as practicable on or after any date
of exercise of this Warrant pursuant to this Section 2, the Company shall issue
and deliver to the
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Person or
Persons entitled to receive the same a certificate or certificates for the
number of whole shares of Warrant Stock issuable upon such exercise, together
with cash in lieu of any fraction of a share equal to such fraction of the
current Fair Market Value of one whole share of Warrant Stock as of the date of
exercise of this Warrant. No fractional shares or scrip representing fractional
shares shall be issued upon an exercise of this Warrant.
2.5 Partial Exercise; Effective
Date of Exercise. In case of any partial exercise of this
Warrant, the Company shall cancel this Warrant upon surrender hereof and shall
execute and deliver a new Warrant of like tenor and date for the balance of the
shares of Warrant Stock purchasable hereunder. This Warrant shall be deemed to
have been exercised immediately prior to the close of business on the date of
its surrender for exercise as provided above. The Person entitled to receive the
shares of Warrant Stock issuable upon exercise of this Warrant shall be treated
for all purposes as the holder of record of such shares as of the close of
business on the date the Holder is deemed to have exercised this
Warrant.
2.6 Purchase Price
Adjustment.
(a) If
the Company shall effect a subdivision of the outstanding Common Stock, the
Purchase Price then in effect immediately before such subdivision shall be
proportionately decreased. If the Company shall combine the
outstanding shares of Common Stock, the Purchase Price then in effect
immediately before the combination shall be proportionately
increased. If the Company shall make or issue a dividend or other
distribution payable in securities, then and in each such event provision shall
be made so that the holder of this Warrant shall receive upon exercise hereof,
in addition to the number of shares of Common Stock receivable thereupon, the
amount of securities that the holder of this Warrant would have received had
this Warrant been exercised for Common Stock on the date of such event and had
such holder thereafter during the period from the date of such event to and
including the date of exercise of this Warrant retained such securities
receivable by such holder as aforesaid during such period, giving effect to all
adjustments called for during such period under this paragraph. If
the Company shall reclassify its Common Stock (including any reclassification in
connection with a consolidation or merger in which the Company is the surviving
corporation), then and in each such event provision shall be made so that such
holder shall receive upon exercise hereof the amount of such reclassified Common
Stock that such holder would have received had this Warrant been exercised for
Common Stock immediately prior to such reclassification and had such holder
thereafter, during the period from the date of such event to and including the
date of exercise of this Warrant, retained such reclassified Common Stock,
giving effect to all adjustments called for during such period under this
paragraph with respect to the rights of the holder of this Warrant.
(b) Whenever
the Purchase Price shall be adjusted as provided in this Section 2.6, the
Company shall forthwith provide notice of such adjustment to the holder of this
Warrant together with a statement, certified by the chief financial officer of
the Company, showing in detail the facts requiring such adjustment and the
Purchase Price that shall be in effect after such
adjustment. Notwithstanding the foregoing, no adjustment in the
Purchase Price shall be required unless such adjustment would require a change
of at least 1% in such Purchase Price; provided, however, that any
adjustments which by reason of this paragraph (b) are not
{Securities
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required
to be made shall be carried forward and taken into account in any subsequent
adjustment.
(c) In
case of any consolidation or merger of the Company with or into another
corporation or the conveyance of all or substantially all of the assets of the
Company to another corporation, this Warrant shall thereafter be exercisable (to
the extent such exercise is permitted hereunder) into the number of shares of
stock or other securities or property to which a holder of the number of shares
of Common Stock of the Company deliverable upon exercise of this Warrant would
have been entitled upon such consolidation, merger or conveyance; and, in any
such case, appropriate adjustment shall be made in the application of the
provisions herein set forth with respect to the rights and interest thereafter
of the holder of this Warrant, to the end that the provisions set forth herein
shall be thereafter applicable, as nearly as reasonably may be, in relation to
any shares of stock or other property thereafter deliverable upon the exercise
of the this Warrant.
3. VALID ISSUANCE;
TAXES. All shares of Warrant Stock issued upon the exercise of
this Warrant shall be validly issued, fully paid and non-assessable; provided
that the Company shall pay all taxes and other governmental charges that may be
imposed in respect of the issue or delivery thereof. The Company shall not be
required to pay any tax or other charge imposed in connection with any transfer
involved in the issuance of any certificate for shares of Warrant Stock in any
name other than that of the Registered Holder of this Warrant, and in such case
the Company shall not be required to issue or deliver any stock certificate or
security until such tax or other charge has been paid, or it has been
established to the Company's reasonable satisfaction that no tax or other charge
is due.
4. LOSS OR MUTILATION. Upon
receipt of evidence reasonably satisfactory to the Company of the ownership of
and the loss, theft, destruction or mutilation of this Warrant, and of indemnity
reasonably satisfactory to it, and (in the case of mutilation) upon surrender
and cancellation of this Warrant, the Company shall execute and deliver in lieu
thereof a new Warrant of like tenor as the lost, stolen, destroyed or mutilated
Warrant.
5. RESERVATION OF WARRANT STOCK .
Notwithstanding anything to the contrary in this Agreement, Holder acknowledges
that as of the date hereof, the number of authorized but unissued (and otherwise
unreserved) shares of Common Stock is less than the minimum required to honor
conversion requests hereunder (the “Share Deficiency”). The Company
agrees to take action as soon as practicably possible to remedy the Share
Deficiency. After remedy of the Share Deficiency, the Company hereby
covenants that at all times there shall be reserved for issuance and delivery
upon exercise of this Warrant such number of shares of Warrant Stock, Common
Stock or other shares of capital stock of the Company as are from time to time
issuable upon exercise of this Warrant and, from time to time, will take all
steps necessary to amend its Articles of Incorporation to provide sufficient
reserves of shares of Warrant Stock issuable upon exercise of this Warrant. All
such shares shall be duly authorized, and when issued upon such exercise, shall
be validly issued, fully paid and non-assessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale and
free and clear of all preemptive rights, except encumbrances or restrictions
arising under federal or state securities laws. Issuance of this Warrant shall
constitute full authority to the Company's officers who are
{Securities
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charged
with the duty of executing stock certificates to execute and issue the necessary
certificates for shares of Warrant Stock upon the exercise of this
Warrant.
6. RESTRICTIONS ON TRANSFER. The
Holder, by acceptance hereof, agrees that, absent an effective registration
statement filed with the SEC under the Securities Act of 1933, as amended (the
"Securities Act"), covering the disposition or sale of this Warrant or the
Warrant Stock issued or issuable upon exercise hereof, as the case may be, and
registration or qualification under applicable state securities laws, such
Holder will not sell, transfer, pledge, or hypothecate any or all such Warrants
or Warrant Stock, as the case may be, unless either (a) the Company has received
an opinion of counsel, in form and substance reasonably satisfactory to the
Company, to the effect that such registration is not required in connection with
such disposition or (b) the sale of such securities is made pursuant to SEC Rule
144.
7. NOTICE. All notices
and other communications from the Company to the Holder shall be sent to the
Holder at the address for such Holder set forth on the Company’s books and
records.
8. HEADINGS; SECTION
REFERENCE. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof. All Section references herein are references, to Sections of
this Warrant unless specified otherwise.
9. LAW GOVERNING. .
This Warrant shall be governed by and construed in accordance with the laws of
the State of New York without regard to the conflict of laws
provisions. The parties agree that the New York State Supreme Court
located in the County of Nassau, State of New York shall have exclusive
jurisdiction in connection with any dispute concerning or arising out of this
Warrant, or otherwise relating to the parties relationship. In any
action, lawsuit or proceeding brought to enforce or interpret the provisions of
this Warrant and/or arising out of or relating to any dispute between the
parties, the prevailing party with respect to each specific issue in a matter
shall be entitled to recover all of his or its costs and expenses relating to
such issue (including without limitation, reasonable attorney’s fees and
disbursements) in addition to any other relief to which such party may be
entitled..
10. NO IMPAIRMENT. The Company
will not, by amendment of its Articles of Incorporation or bylaws, or through
reorganization, consolidation, merger, dissolution, issue or sale of securities,
sale of assets or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Registered Holder of this Warrant against impairment. Without
limiting the generality of the foregoing, the Company: (a) will not increase the
par value of any shares of stock issuable upon the exercise of this Warrant
above the amount payable therefor upon such exercise and (b) will take all such
action as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and nonassessable shares of Warrant Stock upon
exercise of this Warrant.
11. SEVERABILITY. If any term,
provision, covenant or restriction of this Warrant is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the
{Securities
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terms,
provisions, covenants and restrictions of this Warrant shall remain in full
force and effect and shall in no way be affected, impaired or
invalidated.
12. COUNTERPARTS. For the
convenience of the parties, any number of counterparts of this Warrant may be
executed by the parties hereto and each such executed counterpart shall be, and
shall be deemed to be, an original instrument.
13. NO INCONSISTENT AGREEMENTS.
The Company will not on or after the date of this Warrant enter into any
agreement with respect to its securities which is inconsistent with the rights
granted to the Holder or otherwise conflicts with the provisions
hereof.
14. SATURDAYS, SUNDAYS AND
HOLIDAYS. If the Expiration Date falls on a Saturday, Sunday or legal
holiday, the Expiration Date shall automatically be extended until 5:30 P.M. the
next business day.
[Remainder
of Page Intentionally Left Blank’ Signature Page Follows]
{Securities
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IN WITNESS WHEREOF, the
undersigned duly authorized representative of the Company has executed this
Series D Warrant as of the day and date first written above.
DIGITALPOST
INTERACTIVE, INC.
By:
Name:
▇▇▇▇ ▇▇▇▇▇▇▇
Title:
CEO/President
{Securities
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EXHIBIT
1
NOTICE
OF EXERCISE
(To
be executed upon exercise of Warrant)
The
undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, ___ shares of Warrant
Stock:
|
|
4.
|
Tenders
herewith payment of the exercise price in full in the form of cash or a
certified or official bank check in same-day funds in the amount of
$_______ for __________ such
securities.
|
|
|
5.
|
Elects
the Net Issue Exercise option pursuant to Section 2.2 of the Warrant, and
accordingly requests delivery of a net of _________ of such securities,
according to the following
calculation:
|
|
|
X =
Y
(A-B)
|
( )=
( )
[( ) -
( )]
|
A (_______)
Where:
X = the
number of shares of Warrant Stock to be issued to the Holder;
Y = the
total number of shares of Warrant Stock as to which this Warrant is being
exercised;
A = the
Fair Market Value of one share of the Warrant Stock; and
B = the
Purchase Price of one share of Warrant Stock.
|
|
6.
|
Elects
the Easy Sale Exercise option pursuant to Section 2.3 of the Warrant, and
accordingly requests delivery of a net of ________ of such securities to
the brokerage firm identified below and attaches the agreement of said
firm to pay to the Company out of the proceeds of sale the purchase price
of the Warrant Shares.
|
Unless
Easy Sale Exercise is elected above, in which case the Warrant Shares shall be
issued to the Warrant Holder’s account at said brokerage firm, please issue a
certificate or certificates for such securities in the name of, and pay any cash
for any fractional share to (please print name, address and social security
number):
Name: ______________________________________
Address: ______________________________________
Signature: ______________________________________
Date: ______________________________________
{Securities
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Note: The
above signature should correspond exactly with the name on the first page of
this Warrant Certificate or with the name of the assignee appearing in the
assignment form below.
If said
number of shares shall not be all the shares purchasable under the within
Warrant Certificate, a new Warrant Certificate is to be issued in the name of
said undersigned for the balance remaining of the shares purchasable thereunder
rounded up to the next higher whole number of shares.
{Securities
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EXHIBIT
C
AMENDMENT
TO SECURITY AGREEMENT
This Amendment to Security Agreement
(this “Amendment”),
dated as of September __, 2008, is by and between (i) DigitalPost Interactive, Inc.,
a Nevada corporation (the “Debtor”),
and (ii) Agile Opportunity
Fund, LLC, a Delaware limited liability company (“Agile”),
and other secured parties that may hereafter become a party hereto (collectively
with Agile, the “Secured
Parties”).
Background
|
|
1.
|
On
May 30, 2008, the Debtor entered into a Security Agreement with the
Secured Parties (the “Security
Agreement”) granting the Secured Parties a first priority security
interest in the Collateral (as therein defined and described) securing
certain Original Issue Discount Term Promissory Notes (the “Original
Notes”) purchased or to be purchased by the Secured Parties from
the Debtor pursuant to a Securities Purchase Agreement between the Debtor
and the Secured Parties dated as of the date of the Security Agreement
(the “Original
Securities Purchase
Agreement”).
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|
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2.
|
Agile
has purchased from the Debtor an additional Original Issue Discount Term
Promissory Note (the “Follow-on
Note”) in the face amount of $180,000.00, pursuant to an additional
Securities Purchase Agreement between the Debtor and Agile dated as of the
date hereof (the “Follow-on
Securities Purchase Agreement”). Capitalized terms used
herein and not otherwise defined herein shall have the meanings specified
in the Follow-on Securities Purchase
Agreement.
|
|
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3.
|
To
induce Agile to purchase the Follow-on Note, the Debtor has agreed to
extend the first priority security interest in the Collateral granted to
the Secured Parties pursuant to the Security Agreement to secure repayment
of the Follow-On Note as herein set
forth.
|
N O W, T
H E R E F O R E,
In consideration of the promises and
the mutual covenants and agreements herein set forth, and in order to induce
Agile to purchase the Note, the Debtor hereby agrees with the Secured Parties as
follows:
Section
1. Amendment
of Security Agreement. The Security Agreement is hereby
amended by (i) amending the definition of the term “Obligations” contained in
Section 6 thereof to include collectively all obligations of the Debtor to the
Secured Parties under the Original Notes and the Follow-on Note, whether now
existing or hereafter arising and whether for principal, interest, costs, fees
or otherwise (collectively, the “Obligations”)
and (ii) amending Section 20 thereof (Termination) such that the reference
therein to the “Notes” shall include and extend to the Follow-on
Note.
Section
2. Representations
and Warranties; Covenants. The Debtor hereby represents and
warrants that all representations and warranties in the Security Agreement were
true and correct when made and are true and correct as of the date hereof as if
they were made on and as of the date hereof and that the Debtor has properly
complied and continues to comply with all covenants of the Debtor made in the
Security Agreement.
Section
3. Governing
Law; Jurisdiction. This Security Agreement Amendment shall be
governed by the laws of the State of New York, without giving effect to such
jurisdiction’s principles of conflict of laws, except to the extent that the
validity or the perfection of the security interest hereunder, or remedies
hereunder, in respect of any particular Collateral are governed by the laws of a
jurisdiction other than the State of New York. Each of the parties
hereto submits to the personal jurisdiction of and each agrees that all
proceedings relating hereto shall be brought in federal or state courts located
within Nassau or Suffolk Counties in the State of New York.
Section
4. Counterparts. This
Security Agreement Amendment may be executed in any number of counterparts, each
of which will be deemed an original, but all of which together shall constitute
one and the same instrument.
[Remainder
of Page Intentionally Left Blank]
{Securities
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IN
WITNESS WHEREOF, the parties hereto, by their duly authorized agents, have
executed this Amendment to Security Agreement as of the date set forth
above.
DIGITALPOST
INTERACTIVE, INC.
By:
Name:
▇▇▇▇ ▇▇▇▇▇▇▇
Title:
CEO/President
AGILE
OPPORTUNITY FUND, LLC
By: AGILE
INVESTMENTS, LLC, Managing Member
By:___________________________________________
Name:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing
Member
{Securities
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