Warrant Agreement - Siden Investments Ltd. and Communicate.com Inc.
WARRANT AGREEMENT
BETWEEN:
SIDEN INVESTMENTS LTD., a company having its principal
business office at 1729 Acadia Road, Vancouver, BC, CANADA,
V6T 1R2
(the "Warrant Holder")
AND:
COMMUNICATE.COM, INC., a corporation incorporated under the
laws of the State of Nevada, the United States of America,
having a business address at 1300 - 1090 West Georgia Street,
Vancouver, BC, CANADA, V6E 3V7
(the "Company")
RECITALS:
A. As an inducement for the Warrant Holder to enter into a loan agreement (the
"Loan Agreement") dated October 10th, 2001 with the Company and its subsidiary,
Communicate.com Inc., a corporation incorporated under the laws of Alberta,
Canada, the Company has agreed to grant the Warrant Holder a Warrant to
subscribe for and purchase shares in its capital as set forth below.
THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and for
value received, the Company hereby grants the Warrant Holder the Warrant (the
"Warrant") to subscribe for and purchase 10,000,000 fully paid and
non-assessable common shares ("Common Shares") in the capital of the Company at
a price calculated at the weighted average daily closing price the Company as
recorded on the OTCBB for the month of October, or $_____ per share (the
"Warrant Price") at any time prior to 4:30 p.m. (Vancouver Time) on October
10th, 2004, (the "Expiry Time") upon the terms and conditions hereinafter set
forth.
1. This Warrant may be exercised by the Warrant Holder, in whole or in part (but
not as to a fractional share) by delivery of a Notice of Exercise of Warrant in
substantially the form set out in Schedule "A" hereto. Payment of the Warrant
Price shall be tendered with the Notice of Exercise of Warrant and shall be (a)
by certified cheque payable to or to the order of the Company; (b) by set-off of
against the amount owed pursuant to the Loan Agreement; or (c) by a combination
of the foregoing, as designated in the Notice of Exercise of Warrant.
2. In the event of any exercise of the rights represented by this Warrant,
certificates for the Common Shares so purchased shall be delivered to the
Warrant Holder within a reasonable time, not exceeding three business days after
the rights represented by this Warrant shall have been so exercised and, unless
this Warrant has expired, a new Warrant representing the number of Common
Shares, if any, with respect to which this Warrant shall not then have been
exercised shall also be issued to the Warrant Holder within such time. This
Warrant will be void if not exercised prior to the Expiry Time.
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3. The Company covenants and agrees that all Common Shares which are issued upon
the exercise of this Warrant will, upon issuance, be fully paid and
non-assessable and free of all liens, charges and encumbrances. The Company
further covenants and agrees that during the period within which the rights
represented by this Warrant may be exercised, the Company will at all times have
authorized and reserved, a sufficient number of Common Shares to provide for the
exercise of the rights represented by this Warrant.
4. If the Company shall at any time while this Warrant is outstanding subdivide
its outstanding common shares into a greater number of shares, the Warrant Price
shall be proportionately reduced and the number of subdivided Common Shares
entitled to be purchased proportionately increased, and conversely, in case the
outstanding common shares of the Company shall be combined into a smaller number
of shares, the Warrant Price shall be proportionately increased and the number
of combined Common Shares entitled to be purchased hereunder shall be
proportionately decreased.
5. If any capital reorganization, reclassification or consolidation of the
capital stock of the Company, or the merger or amalgamation of the Company with
another corporation shall be effected while this Warrant is outstanding, then as
a condition of such reorganization, reclassification, consolidation, merger or
amalgamation, adequate provision shall be made whereby the Warrant Holder shall
have the right to purchase and receive upon the basis and upon the terms and
conditions specified in this Warrant and in lieu of the Common Shares
immediately theretofore purchasable and receivable upon the exercise of the
rights represented hereby, such shares of stock, or other securities as may be
issued with respect to or in exchange for such number of outstanding Common
Shares equal to the number of Common Shares purchasable and receivable upon the
exercise of this Warrant had such reorganization, reclassification,
consolidation, merger or amalgamation not taken place. The Company shall not
effect any merger or amalgamation unless prior to or simultaneously with the
consummation thereof the successor corporation (if other than the Company)
resulting from such merger or amalgamation shall assume by written instrument
executed and mailed or delivered to the Warrant Holder of this Warrant the
obligation to deliver to such Warrant Holder such shares of stock or securities
in accordance with the foregoing provisions.
6. In case at any time while this Warrant is outstanding:
(d) Company shall pay any dividend payable in stock upon its common
shares or make any distribution to the holders of its Common
Shares;
(e) the Company shall offer for subscription pro rata to the holders
of its Common Shares any additional shares of stock of any class
or other rights;
(f) there shall be any capital reorganization, or reclassification of
the capital stock of the Company, or consolidation or merger or
amalgamation of the Company with, or sale of all or substantially
all of its assets to another corporation; or
(g) there shall be a voluntary or involuntary dissolution, liquidation
or winding-up of the Company;
then, and in any one or more of such cases, the Company shall give to the
Warrant Holder of this Warrant, at least twenty days prior written notice of the
date on which the books of the Company shall close or a record shall be taken
for such dividend, distribution or subscription rights, or for determining
rights to vote with respect to such reorganization, reclassification,
consolidation, merger, or amalgamation, dissolution, liquidation or winding-up
and in the case of any such reorganization, reclassification, consolidation,
merger, amalgamation, sale, dissolution, liquidation or winding-up, at least
twenty (20) days prior written notice of the date when the same shall take
place. Such notice in accordance with the foregoing clause, shall also specify,
in the case of any such dividend, distribution or subscription rights, the date
on which the holders of Common Shares shall be entitled thereto, and such notice
in accordance with the foregoing shall also specify the date on which the
holders of Common Shares shall be entitled to exchange their Common Shares for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, amalgamation, sale, dissolution,
liquidation or winding-up as the case may be. Each such written notice shall be
given by first class mail, registered postage prepaid, addressed to the Warrant
Holder of this Warrant at the address of such Warrant Holder, as shown on the
books of the Company.
7. As used herein, the term "Common Shares" shall mean and include the Company's
presently authorized common shares and shall also include any capital stock of
any class of the Company hereafter authorized which shall not be limited to a
fixed sum or percentage in respect of the rights of the holders thereof to
participate in dividends and in the distribution of assets upon the voluntary or
involuntary liquidation, dissolution or winding-up of the Company.
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8. This Warrant shall not entitle the Warrant Holder hereof to any rights as a
shareholder of the Company, including without limitation, voting rights.
9. Any notice or delivery or surrender of documents shall be valid and effective
if delivered personally or if sent by registered letter, postage prepaid, or if
electronically transmitted by facsimile transmission tested for reception prior
to use, addressed to the party to its address set out at the beginning of this
Agreement and shall be deemed to have been effectively given, received and made
on the date of personal delivery or on the fourth business day after the time of
mailing or upon actual receipt, whichever is sooner, or upon the day, other than
Saturday, Sunday, or statutory holiday, after the time of facsimile
transmission. In the case of disruption in postal services any notice, if
mailed, shall not be deemed to have been effectively given until it is
personally delivered. The Company or the Warrant Holder may from time to time
notify the other in writing of a change of address.
10. All monetary references in this Agreement are in lawful currency of the
United States of America and all payments made under this Agreement shall be
made in such currency.
11. This Agreement shall be governed and construed by the laws of the Province
of British Columbia, including the laws of Canada applicable thereto, but
excepting any of its conflict of laws rules which would have the effect of
applying the laws of any other jurisdiction. The parties further agree that the
courts of British Columbia shall have exclusive jurisdiction over all disputes
relating to this Agreement.
12. Time shall be of the essence hereof.
IN WITNESS WHEREOF the Company has caused this Warrant to be signed by its duly
authorized officers under its corporate seal, and this Warrant to be dated
SIDEN INVESTMENTS LTD. COMMUNICATE.COM, INC.
Per: Per:
----------------------------- ----------------------------
Authorized Signatory Authorized Signatory
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NOTICE OF EXERCISE OF WARRANT
-----------------------------
TO: COMMUNICATE.COM, INC.
1300 - 1090 West Georgia Street
Vancouver, BC
V6E 3V7
THE UNDERSIGNED, the Warrant Holder of the within Warrant Agreement, subscribes
for ________________ of the common shares referred to in the said Warrant
Agreement at according to the conditions thereof, and herewith makes payment of
$_________________________ as follows:
(a) by set off against the amount owing under pursuant to the
Loan Agreement (as described in the Warrant Agreement) in the
amount of
$_______________________________________________________; and
(b) the sum of $____________________ by way of certified cheque
enclosed herewith.
All
The undersigned hereby directs that the shares hereby subscribed for be issued
and delivered as follows:
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NAME(S) IN FULL
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ADDRESS(ES)
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NO. OF SHARES
DATED this ______ day of _________________, 200 __.
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