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EXHIBIT 10.99(h)(1)  


 
 

FASTVOICE
  TERM SHEET    
  


    This Term Sheet is an outline of the basic terms of our proposal. It is a commitment subject to the completion of due diligence, approval by our investment
committee and the execution and delivery of final documentation satisfactory to all parties. 


OCTOBER 31, 2000



	Company:	 	FastVoice ("Borrower" or "Company")
	

Lenders:	
 	

Zilkha Venture Partners, L.P. ("ZVP"), and other Participants (collectively "Lenders")
	

Facility:	
 	

Up to $1,500,000 bridge loan payable as follows:
	

 	
 	

 	
 	

a) ZVP to fund $300,000 on Closing Date
	

 	
 	

 	
 	

b) ZVP with option to fund $200,000 on the following schedule: (i) $100,000 on December 1, 2000 and (ii) $100,000 on January 5, 2001.
	

 	
 	

 	
 	

c) Other Participants to fund $200,000 on Closing Date, or at their option to commit on or before Closing Date to exercise any existing subscription agreements, warrants or options (as the case may be) to purchase Common Stock for the aggregate price
of not less than $200,000; provided that such commitment to exercise shall be closed not later than November 14, 2000, and
	

 	
 	

 	
 	

d) Other Participants with option to fund (i) $400,000 on December 1, 2000 and (ii) $400,000 on January 5, 2001.
	

Closing Date:	
 	

On or before November 7, 2000
	

Due Diligence:	
 	

ZVP to conduct and complete due diligence, reasonably satisfactory to ZVP, by (i) December 1, 2000 for purposes of exercising its option to fund the second and third tranches of the bridge loan and (ii) January 31, 2001 for purposes of submitting a
term sheet to lead the Next Round (defined below)
	

Repayment in Cash

or by Exchange:	
 	

At the Maturity Date the outstanding principal and accrued interest of the Notes (the "Debt"), the Borrower shall repay the Debt to the Lenders by exchanging the Debt for a number of Series A Convertible Preferred ("Series A") shares (or, if no
Series A shares are offered, an equivalent number of other equity securities offered) which number shall equal the quotient of i) the Debt, divided by ii) the product of the lowest price per share for which shares are sold at the Next Round times .80
(the "conversion formula"). In the event ZVP does not lead the Next Round and the Next Round does not close on or before July 1, 2001, ZVP at its option may require that the Debt be repaid in immediately available funds pursuant to the terms of the
Note.
	

Interest Rate:	
 	

Eleven percent (11%) per annum, compounded daily, based upon a 360-day year.
	

Senior Notes:	
 	

Promissory Notes to be senior to all future debt and all other existing unsecured or unencumbered debt obligations (the "Notes").
	

Maturity Date:	
 	

The earlier of July 1, 2001, or upon closing of the Next Round.
	
 	
 	

 	
 	

 



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Extension:	
 	

At the Borrower's option, the Maturity Date may be extended for a period of 30 days; provided, however, in the event of any such extension, the multiplier in the conversion formula shall be decreased from ".80" to ".72."
	

Collateral:	
 	

Lenders shall have a first priority security interest in all unencumbered personal property and assets of Borrower, including intellectual property, see Exhibit A hereto
	

Equity:	
 	

For a period of 30 days after the opening of the Next Round, Lenders shall have the right to purchase up to 50% of the Series A shares (or such other equity securities), which are offered for sale by the Company in the next round of financing in
which Borrower receives at least $5,000,000 ("Next Round").
	

Liquidity Event:	
 	

In the event of a Liquidity Event prior to the Next Round, Lenders shall have the right to convert the Notes to common stock on the same basis as the conversion formula and participate in the Liquidity Event, or at Lenders' option, accelerate the
Note and require Borrower to repay the Debt. For purposes hereof, Liquidity Event shall include a merger, consolidation, sale, disposition, dissolution or related transaction resulting in a sale of all or substantially all of the stock or assets of
the Borrower.
	

Closing Conditions:	
 	

On or before the Closing Date, each person with a right to purchase securities in the Company, whether such right arises from a subscription agreement or other instrument (including a certain Common Stock Purchase Right Agreement, dated as of January,
 2000 (the "Rights Agreement")) shall have exercised, committed to exercise or waived such right. For purposes of the initial funding of the Facility by "other Participants," any exercise pursuant to the preceding sentence shall be applied toward the
initial $200,000 tranche. In addition, on or before the Closing Date each such person shall indicate their understanding that any waiver of one's right under any such subscription agreement, pre-emptive right or related anti-dilution protection,
including the Rights Agreement, shall constitute a waiver of such person's right to participate in the Next Round on a preferential pre-emptive basis.
	

Financial Covenants:	
 	

None.
	

Reporting:	
 	

Monthly financials within 25 days, FYE audited and unqualified opinion within 180 days. Other reports on request.
	

Documentation:	
 	

Lender's standard documents, including: conditions to advances, representations and warranties on company status, legal compliance, liens, legal compliance; covenants on investments, liens, debt, dispositions, insurance; remedies, jury waiver and WA
law.
	

Expenses:	
 	

Company to reimburse ZVP.
	

Confidentiality:	
 	

This Term Sheet is confidential and proprietary to Lenders. Please treat it with the same respect that we treat your private information and do not disclose it to any third parties.



[Remainder of this Page is Intentionally Left Blank] 


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To confirm your agreement with these basic terms, please fax a signed copy of this Term Sheet to our office. 



	Zilkha Venture Partners L.P.	 	 	 	 
	

By: 	
 	

/s/ [ILLEGIBLE]
 Its: General Partner	
 	

 	
 	

 
	Date:	 	 October 31, 2000	 	Agreed and confirmed:
	

 	
 	

 	
 	

FASTVOICE.COM
	

 	
 	

 	
 	

By: 	
 	

/s/ [ILLEGIBLE]

	 	 	 	 	Title:	 	 President

	 	 	 	 	Date:	 	 Nov. 3, 2000





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EXHIBIT A    
  


 
 

Schedule of Unsecured Assets    
  


    
See attached schedule. Does not include intellectual property. 


4





 
 
 

FastVoice.com
  Assets by Category    
  



	Asset Category
	 	Barcode

#
	 	Asset Description
	 	Serial Number
	 	Date

Acquired
	 	Purchase Price
	 	Location

	Software	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	76	 	Visio 2000 Ent CD	 	SHP 123165	 	14-Mar-2000	 	992.21	 	Seattle
	 	 	75	 	CDW Software—Adobe Photoshop, Visio 2000, Adobe Illustrator	 	HS45PE-0197634820	 	19-Jan-2000	 	1,141.42	 	Seattle
	 	 	74	 	TOAD Debugger Software	 	NVTBPSU01	 	21-Jul-2000	 	2,067.64	 	Seattle
	 	 	46	 	Veritas Media/Documentation Kit & netbackup shared storage option	 	SLNSS115000	 	5-Jun-2000	 	6,914.34	 	SD
	 	 	71	 	Together/Solo	 	SOLO	 	13-Sep-2000	 	7,797.48	 	Seattle
	 	 	70	 	Toplink JAVA	 	10140	 	25-Sep-2000	 	19,792.35	 	Seattle
	Laptops	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	16	 	Fijitsu - E5140	 	R9Y01190	 	22-Dec-1999	 	1,840.77	 	Seattle
	 	 	17	 	Fijitsu - E5140	 	R9Y04048	 	22-Dec-1999	 	1,840.77	 	Seattle
	 	 	22	 	HP Omnibook Laptop	 	TW01010262	 	14-Mar-2000	 	2,168.18	 	Seattle
	 	 	24	 	Dell Inspirion 6000	 	9003WCC1FC68	 	15-Mar-2000	 	4,127.93	 	Seattle
	 	 	23	 	Dell Inspirion 5000	 	9003WCC1FC68	 	15-Mar-2000	 	4,127.94	 	Seattle
	 	 	1	 	Dell Inspirion 7500 (Y1GXN)	 	0009963T129619BH1632	 	3-Jan-2000	 	4,272.31	 	Seattle
	 	 	2	 	Dell Inspirion 7500	 	57155479-Y1GXP	 	3-Jan-2000	 	4,272.32	 	Seattle
	 	 	61	 	Boxlight Projector	 	2400X0-9M	 	5-Jun-2000	 	6,038.70	 	Seattle
	Servers	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	11	 	Hard Drives	 	7BV00EJS	 	22-Mar-2000	 	469.15	 	Seattle
	 	 	10	 	Hard Drive	 	7BV00RGS	 	22-Mar-2000	 	469.15	 	Seattle
	 	 	9	 	Exchange Server	 	 	 	16-Dec-1999	 	480.00	 	SD
	 	 	39	 	Color Frame Buffer	 	N/A	 	6-Apr-2000	 	690.69	 	SD
	 	 	8	 	File Server (Odd-Job)	 	Clone	 	16-Dec-1999	 	802.56	 	Seattle
	 	 	40	 	APC Smart 1400 RM UPS	 	N/A	 	11-Apr-2000	 	828.97	 	Seattle
	 	 	61	 	Ultra SCSI	 	Sg-XDSK010C-9G	 	30-Jun-2000	 	978.49	 	Seattle
	 	 	28	 	Switches for Servers	 	ALA20049	 	8-Apr-2000	 	1,046.66	 	SD
	 	 	14	 	Web Server	 	Clone	 	13-Jan-2000	 	1,283.02	 	Seattle
	 	 	47	 	Sun Switches	 	 	 	28-Apr-2000	 	2,293.82	 	SD
	 	 	35	 	AG 4000/800 2T1/E1 BD Licence 48 Ports	 	311931	 	25-Apr-2000	 	3,226.50	 	SD
	 	 	10	 	Sun Enterprise Ultra 5 Server	 	FW95210356	 	6-Jan-2000	 	3,910.68	 	Seattle
	 	 	55	 	HP LPR Rack Mounting Server	 	VS02316326	 	12-Jul-2000	 	5,483.46	 	Seattle
	 	 	11	 	Sun Enterprise Ultra 5 Server	 	FW95210292	 	6-Jan-2000	 	3,910.69	 	Seattle




5






  



 
 

FastVoice.com
  Assets By Category    
  



	Asset Category
	 	Barcode

#
	 	Asset Description
	 	Serial Number
	 	Date Acquired
	 	Purchase Price
	 	Location

	 	 	78	 	Telephony Board T1 48 port PCI	 	AG4000DT	 	7-Apr-2000	 	19,023.00	 	SD
	 	 	77	 	Redundant MM7 server hardware platform	 	SS7SRVRT1	 	7-Apr-2000	 	105,400.00	 	SD
	Networking Equipment	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	37	 	HP Procurve 2224 24 Port	 	STW94320824	 	31-Mar-2000	 	720.49	 	Seattle
	 	 	15	 	Watchguard Firebox II Security System	 	3008443	 	16-Dec-1999	 	3,650.61	 	Seattle
	Office Equip/Rack Shelves	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	38	 	Netshelter Shelfs	 	N/A	 	4-Apr-2000	 	1,302.30	 	SD
	 	 	29	 	Surgearrest Rackmount w/Fan	 	 	 	27-Mar-2000	 	1,349.16	 	SD
	 	 	26	 	Rack Base Cabinet	 	 	 	1-Apr-2000	 	1,419.00	 	SD
	 	 	32	 	Netshelter Cabinet w/Vent	 	 	 	14-Apr-2000	 	1,440.80	 	SD
	 	 	45	 	Toshiba Speakerphones	 	 	 	8-June-2000	 	1,597.88	 	Seattle
	 	 	60	 	Movincool Classic 14	 	6990008140	 	21-Aug-2000	 	1,873.90	 	Seattle
	 	 	25	 	LCD Rack Mount Display, kbd and Touchpad	 	STL0003FR-145	 	7-Apr-2000	 	2,310.94	 	SD
	 	 	48	 	Quick Silver Rack & Shelves	 	 	 	18-Apr-2000	 	2,348.48	 	SD
	 	 	36	 	Netserver Rack Mount System	 	SMF-9101389	 	6-Apr-2000	 	2,513.03	 	Seattle
	 	 	64	 	Cow Sofa & Chair	 	N/A	 	25-Aug-2000	 	2,733.75	 	Seattle
	 	 	66	 	Office Units for workstations	 	N/A	 	23-Aug-2000	 	5,000.00	 	Seattle
	 	 	27	 	Netshelter Cabinet	 	 	 	6-Apr-2000	 	5,494.07	 	SD
	 	 	34	 	9176 Cabinet w/mounting kit	 	N/A	 	26-Apr-2000	 	9,426.48	 	SD
	 	 	65	 	IKEA Furniture	 	N/A	 	12-Sep-2000	 	15,605.10	 	Seattle
	 	 	33	 	Misc Assets From Grant Norwitz	 	N/A	 	1-Dec-1999	 	30,780.62	 	Seattle
	 	 	80	 	Industrial Rack Mount PC (Dual Processor) with 16 Quick Connect slots	 	PCXXX	 	7-Apr-2000	 	51,506.84	 	SD
	Computers	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	42	 	Computer	 	 	 	6-Jun-2000	 	664.09	 	Seattle
	 	 	12	 	Workstation - 012 (Contract Use)	 	Clone	 	4-Dec-1999	 	944.92	 	Seattle
	 	 	4	 	Workstation - 004	 	Clone	 	29-Nov-1999	 	1,045.81	 	Seattle
	 	 	7	 	Workstation - 007	 	Clone	 	29-Nov-1999	 	1,045.82	 	Seattle
	 	 	6	 	Workstation - 006	 	Clone	 	29-Nov-1999	 	1,045.82	 	Seattle
	 	 	5	 	Workstation - 005	 	Clone	 	29-Nov-1999	 	1,045.82	 	Seattle
	 	 	21	 	Workstation - 014 (Contract Use)	 	Clone	 	8-Mar-2000	 	1,122.92	 	Seattle
	 	 	72	 	Computer Parts and Components	 	 	 	22-Sep-2000	 	1,225.01	 	Seattle
	 	 	54	 	Computer - Workstation	 	 	 	11-Jul-2000	 	1,303.20	 	Seattle
	 	 	30	 	Apple IMAC DV	 	SXB0132Y7HSE	 	14-Apr-2000	 	1,334.69	 	Seattle
	 	 	13	 	Workstation - 013	 	Clone	 	24-Jan-2000	 	1,362.93	 	Seattle
	 	 	52	 	Computer - Workstation	 	 	 	17-Jul-2000	 	1,374.87	 	Seattle
	 	 	53	 	Computer - Workstation	 	 	 	17-Jul-2000	 	1,374.88	 	Seattle




6






  



 
 

FastVoice.com
  Assets By Category    
  



	Asset Category
	 	Barcode

#
	 	Asset Description
	 	Serial Number
	 	Date Acquired
	 	Purchase Price
	 	Location

	 	 	58	 	18 GB Hard Drive	 	50337052	 	26-Jun-2000	 	 	1,441.23	 	Seattle
	 	 	57	 	18GB Hard Drive	 	50337173	 	26-Jun-2000	 	 	1,441.23	 	Seattle
	 	 	31	 	Apple PM G4	 	SXB0132Y7HSE	 	14-Apr-2000	 	 	1,627.92	 	Seattle
	 	 	41	 	Computer	 	 	 	23-May-2000	 	 	1,641.49	 	Seattle
	 	 	49	 	Computer Workstion	 	 	 	30-Jun-2000	 	 	1,943.93	 	Seattle
	 	 	63	 	Dell - Dimension 4100 Series	 	60CH001	 	16-Aug-2000	 	 	3,508.87	 	Seattle
	 	 	68	 	Dell - Dimension 4100	 	50CH001	 	16-Aug-2000	 	 	3,508.87	 	Seattle
	 	 	44	 	Dell - Dimension XPS B Series	 	 	 	12-Jun-2000	 	 	3,547.99	 	Seattle
	 	 	43	 	Dell - Dimension XPS B Series	 	 	 	12-Jun-2000	 	 	3,547.99	 	Seattle
	 	 	59	 	Toshiba Tecra 8100	 	70785354U	 	8-Aug-2000	 	 	4,324.90	 	Seattle
	 	 	58	 	Presentation LapTop	 	264781U	 	17-Jul-2000	 	 	4,355.11	 	Seattle
	 	 	62	 	Sun Ultra 10	 	PR05168332	 	30-Aug-2000	 	 	7,274.73	 	Seattle
	Printer	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	18	 	Hewlett Packard - Laser Jet Printer 4	 	USBB032197	 	16-Dec-1999	 	 	360.00	 	Seattle
	 	 	20	 	Hewlett Packard Printer	 	SG762120HY	 	16-Dec-1999	 	 	499.00	 	Seattle
	 	 	3	 	QMS SC-200 Digital Copier/Scanner	 	90901444-QMSUSA	 	22-Nov-1999	 	 	388.00	 	Seattle
	 	 	3	 	QMS Magicolor 6100 DP, 384MB 12PPM Color - 24PPM Blk/Wht 1200DPI	 	Q0194843	 	22-Nov-1999	 	 	8,250.50	 	Seattle
	 	 	19	 	Canon Copier	 	CNP408012345?	 	16-Dec-1999	 	 	18,661.00	 	Seattle
	License	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	79	 	MasterVox, Host-Base Text-to-Speech	 	MVRU3-98	 	7-Apr-2000	 	 	158,732.00	 	SD
	 	 	81	 	Veritas Licenses & Oracle	 	OR-03065V801	 	31-Mar-2000	 	 	337,650.50	 	SD
	Intellectual Properties	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total	 	 	 	 	 	 	 	 	 	$	986,300.70	 	 




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QuickLinks


FASTVOICE TERM SHEET


EXHIBIT A

Schedule of Unsecured Assets

FastVoice.com Assets by Category


FastVoice.com Assets By Category


FastVoice.com Assets By Category