Exhibit 4.32
AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into as of November
1, 2000 by and between Insynq, Inc., a Delaware corporation (the "Company"), and
Plazacorp Investments Limited, an Ontario, Canada corporation ("Plazacorp").
WHEREAS, the parties have entered into that certain Registration and
Repurchase Agreement dated as of April 26, 2000 (the "Registration Agreement")
under which Plazacorp has the right to "put" 285,714 shares of the Company's
common stock, par value $.001 per share (the "Common Stock") purchased under the
Subscription Agreement between the parties dated as of the same date as the
Registration Agreement back to the Company at $2.50 per share under certain
conditions; and
WHEREAS, the Company has issued that certain Promissory Note dated as of
October 20, 2000 (the "Note") under which Plazacorp has loaned the Company
$250,000; and
WHEREAS, the parties agree that it will be less burdensome and more
administratively feasible for the Company, in exchange for canceling
Plazacorp's "put" rights valued at $714,285 (285,714 shares multiplied by
$2.50), to issue 1,428,730 shares of its Common Stock to Plazacorp at an agreed
to, arms-length negotiated value of $0.50 per share (the "Put Conversion
Shares"); and
WHEREAS, the parties further agree that it will be less burdensome and more
administratively feasible for the Company, in exchange for canceling Plazacorp's
right to receive payment under the Note, which is due and payable on November 3,
2000, to issue 500,000 shares of its Common Stock to Plazacorp at an agreed to,
arms-length negotiated value of $0.50 per share (the "Note Conversion Shares").
NOW, THEREFORE, in consideration of the foregoing, and of the mutual
covenants hereinafter contained, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. Conversion of Put Shares. The 285,746 shares of Common Stock which
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Plazacorp currently has the right to "put" to the Company at $2.50 per
share under the Registration Agreement (the "Put Shares") are hereby
converted into the right to receive 1,428,730 shares of Common Stock
pursuant to an agreed-to value of $0.50 per share. If the effective
date of a registration statement filed with the U.S. Securities
Exchange Commission ("SEC") registering the Put Conversion Shares (the
"Effective Date") occurs prior to April 26, 2001, Plazacorp shall
promptly return the Put Shares to the Company after the Effective
Date, and the certificates representing the Put Conversion Shares
shall thereafter promptly be issued to Plazacorp. If, however, the
Effective Date occurs after April 26, 2001, Plazacorp shall be
entitled to retain the Put Shares and the Company shall be obligated
to issue such number of additional shares to Plazacorp equal to the
number of Put Conversion Shares less the number of Put Shares retained
by Plazacorp.
2. Conversion of Note. The $250,000 Note under which Plazacorp
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currently has the right to receive payment from the Company on
November 3, 2000, is hereby converted into 500,000 shares of Common
Stock pursuant to an agreed-to value of $0.50 per share. Such Note
Conversion Shares shall be issued upon the execution of this Agreement
by Plazacorp and the return of the $250,000 Note to the Company.
3. Termination of Certain Provisions of Registration Agreement. Sections
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1(a) and 1(b) of the Registration Agreement are hereby terminated in
their entirety.
4. Remaining Provisions of Registration Agreement. The remaining
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provisions of the Registration Agreement shall remain in effect with
respect to the two Warrant Agreements issued to Plazacorp on April 26,
2000 (the "Warrant Agreements") and the Common Stock subject to those
Warrant Agreements.
5. Registration Rights. The Put Conversion Shares issued in exchange for
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the cancellation of the Put Shares and the Note Conversion Shares
issued in exchange for the cancellation of the Note pursuant to this
Agreement are hereby granted the same registration rights as set forth
in the remaining provisions of the Registration Agreement pursuant to
which the Company will promptly file a registration statement with the
SEC. The term "Shares" as defined under the Registration Agreement
shall be amended to include only the shares of Common Stock subject to
the Warrant Agreements, the Put Conversion Shares issued hereunder,
the remaining Put Shares that Plazacorp does not return pursuant to
Section 1 above, and the Note Conversion Shares issued hereunder.
6. Certain Acknowledgments and Agreements of Plazacorp. Plazacorp hereby
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acknowledges and agrees that:
(a) All documents pertaining to the investment in the Put Conversion
Shares and the Note Conversion Shares (collectively, the
"Shares") have been made available for inspection by Plazacorp,
and the books and records of the Company will be available, upon
reasonable notice, for inspection by Plazacorp during reasonable
business hours at the Company's principal place of business.
(b) NO U.S. FEDERAL OR STATE AUTHORITY OR ANY CANADIAN AUTHORITY HAS
MADE ANY FINDINGS OR DETERMINATIONS TO THE FAIRNESS FOR
INVESTMENT IN THE SHARES, AND NO U.S. FEDERAL OR STATE AUTHORITY
OR CANADIAN AUTHORITY HAS RECOMMENDED OR ENDORSED OR WILL
RECOMMEND OR ENDORSE THE SHARES.
(C) The issuance of the Shares was made only through direct, personal
communication between Plazacorp and an authorized representative
of the Company.
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(d) Plazacorp agrees not to sell nor attempt to sell all or any part
of the Shares allocated to Plazacorp unless the offer and sale of
such Shares have first been registered under the Securities Act
of 1933, as amended (the "Securities Act"), and all applicable
state securities laws, or the undersigned furnishes, at the
option of the Company, an opinion of counsel satisfactory to the
Company and its counsel and knowledgeable as to the securities
matters stating that exemptions from such registration
requirements are available and that the proposed sale is not, and
will not place the Company or any affiliate thereof, in violation
of any applicable U.S. Federal or state securities law, or any
rule or regulation promulgated thereunder or under any Canadian
law, rule or regulation. Plazacorp also agrees that any sale or
attempted sale of the Shares within one year of the date of this
Agreement shall be made only in accordance with Section 7(f) of
this Agreement.
(e) The certificate evidencing Shares shall bear a legend
substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION. THESE SHARES MAY NOT BE
TRANSFERRED TO OR ON BEHALF OF ANY UNITED STATES
PERSON, AND MAY NOT BE OFFERED FOR SALE, SOLD OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO REGULATION S
UNDER THE SECURITIES ACT, AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT, OR AN EXEMPTION FROM
REGISTRATION. AS A PREREQUISITE TO ANY TRANSFER OF
SHARES WITHOUT SUCH REGISTRATION, THE CORPORATION MAY
REQUIRE THAT IT BE FURNISHED AN OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION THAT SUCH TRANSFER DOES
NOT REQUIRE SUCH REGISTRATION AND THAT SUCH TRANSFER IS
MADE IN ACCORDANCE WITH REGULATION S OF THE SECURITIES
ACT, INCLUDING BUT NOT LIMITED TO A PROHIBITION ON
TRANSFERS TO U.S. PERSONS WITHOUT REGISTRATION OR AN
EXEMPTION.
7. Representations and Warranties of Plazacorp. Plazacorp understands
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that the Shares are being sold in reliance upon the exemptions
provided in the Securities Act, Regulation D and/or Regulation S
thereunder, together with exemptions provided under applicable state
securities laws, for transactions involving limited
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offers and sales, and Plazacorp, for itself and for its representatives,
successors and assigns, makes the following representations, declarations
and warranties with the intention that the same may be relied on by the
Company in determining the suitability of Plazacorp as an investor in the
Company:
(a) Plazacorp has consulted its attorney, accountant or investment advisor
with respect to the investment contemplated hereby and its suitability
for Plazacorp. The undersigned has received no representations or
warranties from the Company or its officers, directors, employees or
agents, or any other person, and, in making an investment decision,
Plazacorp is relying solely on independent investigations made by
Plazacorp or representative(s) of Plazacorp.
(b) Plazacorp has read and fully understands the public filings of the
Company as filed with the SEC.
(c) The Company has made available to Plazacorp, during the course of this
transaction and prior to the acquisition of any of the Shares, the
opportunity to ask questions of and receive answers from the Company
or any of its representatives concerning the Company, and
to obtain any additional information relative to the financial
condition and business of the Company, to the extent that such parties
possess such information or can acquire it without unreasonable effort
or expense. All such questions, if asked, have been answered
satisfactorily, and all such documents, if requested, have been
received and found to be fully satisfactory. In connection therewith,
Plazacorp is not relying on any documents, records or other
information, except that contained in written form and signed by the
President of the Company.
(d) Plazacorp understands and acknowledges that: (i) while the Company has
an operating history, the acquisition of Shares by Plazacorp involves
a high degree of risk of loss of Plazacorp's entire investment, and
there is no assurance of any income from such investment; (ii)
Plazacorp must bear the economic risk of an investment in the Shares
for an indefinite period because the offer and sale of the Shares have
not been registered under the Securities Act or any state securities
laws and are being offered and sold in reliance upon exemptions
provided in the Securities Act and state securities laws for
transactions not involving any public offering and, therefore, cannot
be resold or transferred unless they are subsequently registered under
the Securities Act and applicable state laws, or unless an exemption
from such registration is available; (iii) there may not be a public
market for the Shares in the future; (iv) Plazacorp is purchasing the
Shares for investment purposes only for Plazacorp's account and not
for the benefit of any other person or with any view toward the resale
or distribution thereof; (v) Plazacorp is not a U.S. person (defined
generally as any natural person residing in the United States, any
entity organized
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under the laws of the United States or estate, trust or other
account administered by or held for the benefit of a U.S. person)
and the Shares are not being acquired for the benefit of any U.S.
person; (vi) because there are substantial restrictions on the
transferability of the Shares, it may not be possible for
Plazacorp to liquidate an investment therein readily in case of
an emergency; and (vii) Plazacorp has no contract, undertaking,
agreement or arrangement with any person to sell, transfer or
pledge to such person or anyone else any of the Shares which
Plazacorp hereby subscribes to purchase or any part thereof, and
Plazacorp has no present plans to enter into any such contract,
undertaking, agreement or arrangement.
(e) The undersigned is an "accredited investor" within the meaning of
Regulation D promulgated under the Securities Act. The net worth,
annual income and total assets, as the case may be, of Plazacorp
and the other information set forth herein are true, correct and
complete in all material respects. Any information which
Plazacorp has heretofore furnished to the Company with respect to
Plazacorp is correct and complete as of the date of this
Agreement, and if there should be any material change in such
information prior to the purchase of Shares, Plazacorp will
immediately furnish such revised or corrected information to the
Company.
(f) Plazacorp understands, acknowledges and agrees that an offer or
sale of these securities, if made prior to the expiration of one
year from the issuance date of the Shares, may not be made to a
U.S. person (defined generally as any natural person residing in
the United States, any entity organized under the laws of the
United States or estate, trust or other account administered by
or held for the benefit of a U.S. person) or for the account or
benefit of a U.S. person and must be made in accordance with the
following: (i) the purchaser must certify that it is not a U.S.
person and is not acquiring the securities for the account or
benefit of any U.S. person or is a U.S. person who purchased
securities in a transaction that did not require registration
under the Securities Act, (ii) the purchaser must agree to
resell the securities only in accordance with the provision of
Regulation S, pursuant to a registration under the Securities
Act, or pursuant to an available exemption from registration and
must agree not to engage in hedging transactions with regard to
these Securities unless in compliance with the Securities Act
(iii) the securities must contain a legend stating that transfer
is prohibited except in accordance with the provisions of
Regulation S, pursuant to registration under the Securities Act,
or pursuant to an available exemption from registration and that
hedging transactions involving these securities may not be
conducted unless in compliance with the Securities Act, (iv) that
the Company may not register any transfer of the Shares not made
in accordance with the provisions of Regulation S, pursuant to
registration under the Securities
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Act, or pursuant to an available exemption from registration and
(v) any distributor selling the Shares to a distributor, a dealer
or a person receiving a selling concession, fee or other
remuneration, prior to the expiration of one year from the
issuance date of the Shares must send a confirmation or other
notice to the purchaser stating that the purchaser is subject to
the same restrictions on offers and sales that apply to a
distributor.
(g) Plazacorp is knowledgeable and experienced in evaluating
investments and is experienced in financial and business matters
and it has evaluated the risks of investing in the Shares, and
has determined that the Shares are a suitable investment for it.
Plazacorp has adequate net worth and means of providing for its
current needs and possible contingencies and has no need, and
anticipates no need in the foreseeable future, to sell the Shares
the purchase of which is subscribed. Plazacorp can bear the
economic risk of an investment in the Shares and has a sufficient
net worth to sustain a complete loss of his investment. The
aggregate amount of the investments of Plazacorp in, and its
commitments to, all similar investments that are illiquid is
reasonable in relation to its net worth.
(h) Plazacorp maintains its domicile, and is not merely a transient
or temporary resident, at the residence address shown on the
signature page of this Agreement.
(i) The representations, warranties, agreements and acknowledgements
made by Plazacorp in this Agreement are made with the intention
that they be relied upon by the Company in determining the
suitability of Plazacorp as a purchaser of Shares, and shall
survive their purchase. In addition, Plazacorp undertakes to
notify the Company immediately of any change in any
representation or warranty of Plazacorp set forth herein.
8. Indemnification. Plazacorp understands that the offer and sale of
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Shares to it is being made, and the sale of Shares will be made, in
reliance upon the acknowledgements and agreements of Plazacorp set
forth in Section 6 and the representations and warranties of Plazacorp
set forth in Section 7. Plazacorp agrees to provide, if requested, any
additional information that may reasonably be required to determine
the eligibility of Plazacorp to purchase Shares. Plazacorp hereby
agrees to indemnify the Company and its affiliates, agents, attorneys
and representatives and to hold each of them harmless, from and
against all claims, losses, damages or liability, including costs and
reasonable attorneys' fees (collectively, "Claims"), that may arise in
connection with, due to or as a result of the breach of any
representation, warranty, acknowledgement or agreement of Plazacorp
contained in this Agreement or in any other document provided by
Plazacorp to the Company in connection with Plazacorp's offer to
purchase Shares. Plazacorp agrees to indemnify the Company and any of
its affiliates agents, attorneys and representatives and to hold each
of them harmless, from and against all Claims that may arise in
connection with, due to or as a result of the
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sale or distribution of Shares by Plazacorp in violation of the Securities
Act or other applicable law. Notwithstanding any provision of this
Agreement, Plazacorp does not waive any rights granted to him under
applicable securities laws. Plazacorp agrees that the affiliates, agents,
attorneys and representatives of the Company are intended third-party
beneficiaries to this Agreement for the purposes of the indemnification
provided above.
9. Arbitration. Any dispute or controversy arising under or in connection with
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this Agreement shall be resolved by binding arbitration. The arbitration
shall be held in the City of Tacoma, Washington, and except to the extent
inconsistent with this Agreement, shall be conducted in accordance with the
rules of the American Arbitration Association in effect at the time of the
arbitration, and otherwise in accordance with principles which would be
applied by a court of law or equity. The arbitrator shall be acceptable to
both the Company and Plazacorp. If the parties cannot agree on an
acceptable arbitrator, the dispute shall be heard by a panel of three
arbitrators, one of which shall be appointed by each of the parties, and
the third shall be appointed by the other two arbitrators.
10. Suitability. Plazacorp warrants and represents to the Company that the
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following information supplied by Plazacorp pursuant to Section 7 is
correct and complete.
11. General. This Agreement (i) shall be binding on Plazacorp and the heirs,
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personal representatives, successors and permitted assigns of Plazacorp,
(ii) shall be governed construed and enforced in accordance with the laws
of the State of Washington, without reference to any principles of
conflicts of law, and (iii) shall survive the acceptance by the Company of
the subscription evidenced by this Agreement and the admission of Plazacorp
as a shareholder in the Company.
12. Notices. Any notice, request, instruction or other document to be given
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under this Agreement after the date hereof by any party hereto to any other
party shall be in writing and shall be deemed to have been duly given on
the date of service if delivered personally or by telecopier with confirmed
receipt via overnight delivery, or on the third day after mailing if sent
by certified mail, postage prepaid, at the addresses set forth below, or to
such other address or person as any party may designate by written notice
to the others:
If to the Company: Insynq, Inc.
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1101 Broadway Plaza
Tacoma, Washington 98402
Attention: President
Telecopier No.: (253) 404-3842
If to Plazacorp: At the last address indicated on the Company's books
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and records.
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13. Assignment. Plazacorp agrees that neither this Agreement nor any
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rights which accrue to him hereunder may be transferred or assigned.
14. Entire Agreement. This Agreement contains the entire understanding of
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the parties relating to the subject matter contained herein and
supersedes all prior agreements and understandings, written or oral,
relating to the subject matter hereof. This Agreement shall not be
modified, amended or terminated except in a writing signed by the
party against whom enforcement is sought.
15. Confidentiality. Plazacorp acknowledges that all Confidential
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Information (as defined herein) shall be and remain the exclusive
property of the Company at all times. Plazacorp hereby agrees to keep
in strict confidence all Confidential Information. Plazacorp shall not
disclose any Confidential Information, or any portion thereof, to any
person or entity nor use, license, sell, convey or otherwise exploit
any Confidential Information, or any portion thereof, for any purpose
other than for the benefit of the Company. As used in this Agreement,
the term "Confidential Information" refers to all information
proprietary to, used by or in the possession of the Company and not
generally known in the industry, which is disclosed to or learned by
Plazacorp, whether or not reduced to writing and whether or not
conceived, originated, discovered or developed in whole or in part by
Plazacorp, including, without limitation: (a) information not
generally known in the industry which relates to the business,
products or work of the Company (x) of a technical nature, such as
trade secrets, methods, know-how, formulas, compositions, designs,
processes, information regarding product development and other similar
information and materials, and (y) of a business or commercial nature,
such as information or compilation of data about the Company's costs,
pricing, profits, compensation, sales, product plans, markets,
marketing plans and strategies, equipment and operational
requirements, operating policies or plans, finances, financial
records, methods of operation and competition, management organization
customers and suppliers, and other similar information and materials;
and (b) any other technical business or commercial information
designated as confidential or proprietary that the Company or any of
its affiliates may receive belonging to any supplier, customer or
others who do business with the Company or any of its affiliates. The
foregoing limitations on use and disclosure shall not apply to
information that (i) was lawfully known to the recipient before the
receipt thereof, (ii) is learned by the recipient from a third party
that is entitled to disclose same, (iii) becomes publicly known other
than through the actions of the recipient, or (iv) is required by law
or court order to be disclosed by the recipient.
16. Pronouns; Headings. All pronouns and any variations hereof shall be
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deemed to refer to the masculine, feminine, neuter, singular or
plural, as the identity of the entities or persons referred may
require. The headings of the sections of this Agreement are inserted
for convenience only and shall not constitute a part hereof nor affect
in any way the meaning or interpretation of this agreement.
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17. Severability. In the event that any provision contained herein shall
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be held to be invalid, illegal or unenforceable for any reason, such
invalidity, illegality or unenforceability shall not affect any other
provision hereof, and this Agreement shall be construed as if such
invalid, illegal or unenforceable provision had never been contained
herein.
18. Conflict. If any conflict shall arise between the terms of the
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Registration Agreement and this Agreement, or the Warrant Agreements
and this Agreement, this Agreement shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
INSYNQ, INC.
a Delaware corporation
By: /s/ John P. Gorst
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Name: John P. Gorst
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Title: Chairman CEO
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PLAZACORP INVESTMENTS LIMITED
an Ontario, Canada corporation
By: /s/ Anthony Heller
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Name: ANTHONY HELLER
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Title: PRESIDENT
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Residence or Office Address:
______________________________
______________________________
______________________________
Mailing Address (only if
different from Residence
Address):
______________________________
______________________________
______________________________
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