JFAX.com Snatches Up eFAX.com

JFAX.com bought rival eFAX.com in a stock exchange worth about $75
million.

JFAX (JFAX)
will issue approximately 18.5 million shares of its common stock to the
holders of eFAX.com (EFAX)
common and preferred stock, subject to an adjustment of this number in
certain circumstances.

In a merger of the world’s largest unified messaging services providers,
JFAX will reap the rewards of more than 125,000 paid subscribers
generating monthly subscription and usage revenue and over 2.8 million free
users.

In other terms of the deal, JFAX has committed to loan eFAX up to $5
million on a secured basis. This loan will
enable eFAX to fund its working capital needs and continuing growth
until the consummation of the merger. The loan commitment also includes a
warrant for JFAX to purchase 250,000 shares of eFAX common stock at
yesterday’s close-of-market price.

JFAX will be able to purchase either 750,000 or 1.75 million shares,
depending on certain circumstances, of eFAX common stock at an exercise
price of $1.00 per share, in the event the merger does not occur.

“With the combined capabilities of both companies, we will expand our
services beyond message management to a full suite of unified communications
solutions,” said Steven J. Hamerslag chief executive officer and president
of JFAX. “This will enable customers to access and initiate business
communications easily and seamlessly through a single communications
provider.”