IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
AG SUPERFUND INTERNATIONAL
PARTNERS, L.P.; GAM ARBITRAGE
INVESTMENTS, INC.; LEONARDO, L.P.; : Civil Action No.
RAMIUS FUND, LTD.; RAPHAEL, L.P., :
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Plaintiffs, : :i !
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INTELECT COMMUNICATIONS, INC., : ..,,,
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Defendant, : --yLJ cn
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COMPLAINT
Plaintiffs AG Superfund International Partners, L.P. ("AG Superfund"), GAM
Arbitrage Investments, Inc. ("GAM"), Leonardo, L.P. ("Leonardo"), Ramius Fund, Ltd.
("Ramius"), Raphael, L.P. ("Raphael"), by and through their attorneys, as and for their
Complaint against Defendant Intelect Communications, Inc. ("Intelect" or the "Company")
allege as follows:
INTRODUCTION
1. Defendant Intelect pocketed over a million dollars from the
in good faith had purchased from Intelect certain convertible preferred stock, i.e., preferred stock
that could be converted into Intelect common stock in accordance with an agreed-upon formula.
Having received Plaintiffs' money into its corporate coffers, Intelect now refuses to honor the
rights of the Plaintiffs to convert their convertible preferred stock into Intelect common stock.
SNIPPETS:
Complaint against Defendant Intelect Communications,
in good faith had purchased from Intelect certain convertible preferred stock, i.e.,
that could be converted into Intelect common stock in accordance with an agreed-upon formula.
Having received Plaintiffs' money into its corporate coffers, Intelect now refuses to honor
rights of the Plaintiffs to convert their convertible preferred stock into Intelect common
a mere two business days after Intelect received $1.5 million from the
rights of conversion under Intelect's certificate of incorporation and contracts for the
under and by virtue of the laws of the Cayman Islands.
Plaintiffs purchased from Intelect shares of the Series E
(4 The Securities Purchase Agreement, dated as of February 24, 1999,
The Certificate of Designations, Preferences and Rights of the
copy of the Waiver Letter is attached hereto as Exhibit C.
Stock in the aggregate principal face amount of $100,000, which sum it duly paid in accordance
Ramius purchased from Intelect 200 shares of the Convertible Preferred
conversions shall be "in accordance with the terms" of the Certificate of Designation.
applicable rights for the conversion of the preferred shares, by which each of the Plaintiffs
times on or after the Issuance Date, any holder of Preferred Shares
Upon receipt by of a copy of a Conversion Notice,
Transfer Agent is participating in The Depository Trust Company
for the Conversion Shares and the Warrant Shares in such amounts as specified from
any breach or threatened breach by Intelect of its obligations
Intelect's Failure to Honor its Contractual Obligations Owed to Plaintiffs
A true and correct copy of Intelect's press release, dated April 26, 1999, is attached hereto
Intelect has failed and refused to honor the conversion requests reflected in
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