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EXHIBIT 10.13
WARRANT PURCHASE AGREEMENT
THIS WARRANT PURCHASE AGREEMENT ("Agreement") is made as of November
16, 1999, by and between Software Technologies Corporation (the "Company"), and
▇▇▇▇▇▇▇▇ Consulting LLP ("AC").
WHEREAS, AC intends to purchase a warrant from the Company, which
warrant will be exercisable for shares of the Company's common stock; and
WHEREAS, the parties hereto wish to provide for the sale and
issuance of such warrant in consideration for services rendered and to be
rendered to the Company by AC as contemplated by Section 3 of the Warrant;
NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Issuance of the Warrant. The Company hereby sells and issues to
AC a warrant (the "Warrant") to purchase shares of the Company's common stock
(collectively, the "Common Stock") as set forth therein in consideration for
services rendered and to be rendered to the Company by AC as contemplated by
Section 3 of the Warrant. The Warrant shall be in the form attached hereto as
Exhibit A.
2. Representations and Warranties of the Company. In connection with
the transactions provided for herein, the Company hereby represents and warrants
to AC that:
2.1 Organization, Good Standing, and Qualification. The Company is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of California and has all requisite corporate power and
authority to carry on its business as now conducted. The Company is duly
qualified to transact business and is in good standing in each jurisdiction in
which the failure so to qualify would have a material adverse effect on its
business or properties.
2.2 Authorization. All corporate action on the part of the Company,
its officers, directors and stockholders necessary for the authorization,
execution and delivery of this Agreement, the performance of all obligations of
the Company hereunder, and the authorization, issuance (or reservation for
issuance), and delivery of the Warrant and the Common Stock issuable upon
exercise of the Warrant has been taken or will be taken prior to the Closing.
2.3 Valid Issuance of Common Stock. The Common Stock, when issued,
sold, and delivered in accordance with the terms of the Warrant for the
consideration expressed therein, will be duly and validly issued, fully paid,
and nonassessable and, based upon the representations of AC in this Agreement,
will be issued in compliance with all applicable federal and state securities
laws.
3. Representations and Warranties of AC. In connection with the
transactions provided for herein, AC hereby represents and warrants to the
Company that:
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3.1 Authorization. This Agreement constitutes AC's valid and legally
binding obligation, enforceable in accordance with its terms.
3.2 Purchase Entirely for Own Account. AC acknowledges that this
Agreement is made with AC in reliance upon AC's representation to the Company
that the Warrant and the Common Stock issuable upon exercise of the Warrant
(collectively, the "Securities") will be acquired for investment for AC's own
account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and that AC has no present intention of
selling, granting any participation in, or otherwise distributing the same. By
executing this Agreement, AC further represents that AC does not have any
contract, undertaking, agreement, or arrangement with any person to sell,
transfer, or grant participations to such person or to any third person, with
respect to the Securities. AC represents that it has full power and authority to
enter into this Agreement.
3.3 Disclosure of Information. AC acknowledges that it has received
all the information it considers necessary or appropriate for deciding whether
to acquire the Securities. AC further represents that it has had an opportunity
to ask questions and receive answers from the Company regarding the terms and
conditions of the offering of the Securities.
3.4 Investment Experience. AC is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment, and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment in the Securities. AC also represents it has
not been organized solely for the purpose of acquiring the Securities.
3.5 Accredited Investor. AC is an "accredited investor" within the
meaning of Rule 501 of Regulation D of the Securities and Exchange Commission
(the "SEC"), as presently in effect.
3.6 Restricted Securities. AC understands that the Securities are
characterized as "restricted securities" under the federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act of
1933, as amended (the "Act"), only in certain limited circumstances. In this
connection, AC represents that it is familiar with SEC Rule 144, as presently in
effect, and understands the resale limitations imposed thereby and by the Act.
3.7 Further Limitations on Disposition. Without in any way limiting
the representations set forth above, AC further agrees not to make any
disposition of all or any portion of the Securities unless and until the
transferee has agreed in writing for the benefit of the Company to be bound by
this Section 3 and:
(a) There is then in effect a Registration Statement under the
Act covering such proposed disposition and such disposition is made in
accordance with such Registration Statement; or
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(b) (i) AC shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, and (ii) if reasonably
requested by the Company, AC shall have furnished the Company with an opinion of
counsel, reasonably satisfactory to the Company, that such disposition will not
require registration of such shares under the Act. It is agreed that the Company
will not require opinions of counsel for transactions made pursuant to Rule
144(k) or pursuant to Rule 144 if the transfer is to an affiliate of the
transferor.
3.8 Legend. It is understood that the Securities shall bear the
following legend:
"These securities have not been registered under the Securities Act
of 1933. They may not be sold, offered for sale, pledged, hypothecated, or
otherwise transferred except pursuant to an effective registration statement
under the Securities Act of 1933 or an opinion of counsel satisfactory to the
Company that registration is not required under such Act or unless sold pursuant
to Rule 144 under such Act."
4. California Corporate Securities Law. THE SALE OF THE SECURITIES
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION FOR SUCH
SECURITIES PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF
SECURITIES IS EXEMPT FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE
CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE
EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS
SO EXEMPT.
5. Right of First Refusal.
5.1 Right of First Refusal. In the event that AC proposes to sell,
pledge or otherwise transfer to a third party (other than an affiliate of AC)
any shares of Common Stock, or any interest in such Common Stock, the Company
shall have the Right of First Refusal to purchase all (or less than all) of such
shares of Common Stock. If AC desires to transfer the Common Stock, AC shall
give a written Transfer Notice to the Company describing fully the proposed
transfer, including the number of shares of Common Stock proposed to be
transferred, the proposed transfer price, the name and address of the proposed
transferee and proof satisfactory to the Company that the proposed sale or
transfer will not violate any applicable federal or state securities laws. The
Transfer Notice shall be signed both by AC and by the proposed transferee and
must constitute a binding commitment of both parties to the transfer of the
Common Stock. The Company shall have the right to purchase all, or less than
all, of the Common Stock on the terms of the proposal described in the Transfer
Notice (subject, however, to any change in such terms permitted under Subsection
5.2 below) by delivery to AC of a notice of exercise of the Right of First
Refusal within 30 days after the date when the Transfer Notice 3
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was received by the Company. The Company's rights under this Subsection 5.1
shall be assignable, in whole or in part.
5.2 Transfer of Shares. If the Company fails to exercise its Right
of First Refusal within 30 days after the date when it received the Transfer
Notice, AC may, not later than 90 days following receipt of the Transfer Notice
by the Company, conclude a transfer of the Common Stock subject to the Transfer
Notice on the terms and conditions described in the Transfer Notice, provided
that any such sale is made in compliance with applicable federal and state
securities laws and not in violation of any other contractual restrictions to
which AC is bound. Any proposed transfer on terms and conditions different from
those described in the Transfer Notice, as well as any subsequent proposed
transfer by AC, shall again be subject to the Right of First Refusal and shall
require compliance with the procedure described in Subsection 5.1 above. If the
Company exercises its Right of First Refusal, the parties shall consummate the
sale of the Common Stock on the terms set forth in the Transfer Notice within 60
days after the date when the Company received the Transfer Notice (or within
such longer period as may have been specified in the Transfer Notice); provided,
however, that in the event the Transfer Notice provided that payment for the
Common Stock was to be made in a form other than cash or cash equivalents paid
at the time of transfer, the Company shall have the option of paying for the
Common Stock with cash or cash equivalents equal to the present value of the
consideration described in the Transfer Notice or as may otherwise be agreed to
by AC and the Company.
5.3 Additional Shares or Substituted Securities. In the event of the
declaration of a stock dividend, the declaration of an extraordinary dividend
payable in a form other than stock, a spin-off, a stock split, a
recapitalization or a similar transaction affecting the Company's outstanding
securities without receipt of consideration, any new, substituted or additional
securities or other property (including money paid other than as an ordinary
cash dividend) which are by reason of such transaction distributed with respect
to any Common Stock subject to this Section 5 or into which such Common Stock
thereby become convertible shall immediately be subject to this Section 5.
Appropriate adjustments to reflect the distribution of such securities or
property shall be made to the number and/or class of Common Stock subject to
this Section 5.
5.4 Termination of Right of First Refusal. The Right of First
Refusal shall lapse upon the earliest to occur of (i) such time as the Company
becomes obligated to file reports pursuant to the Securities Exchange Act of
1934, as amended, or (ii) the closing of a firm commitment underwritten public
offering, pursuant to an effective registration statement on Form S-1 or Form
SB-2 under the Act, covering the offer and sale of the Company's common stock.
However, the market stand-off (described below) shall continue to remain in full
force and effect following the lapse of the right of first refusal set forth in
this Section 5.
5.5 Termination of Rights as Stockholder. If the Company makes
available, at the time and place and in the amount and form provided in this
Agreement, the consideration for the Common Stock to be purchased in accordance
with this Section 5, then after such time the person from whom such Common Stock
is to be purchased shall no longer have any rights as a holder of such Common
Stock (other than the right to receive payment of such consideration in
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accordance with this Agreement). Such Common Stock shall be deemed to have been
purchased in accordance with the applicable provisions hereof, whether or not
the certificate(s) therefor have been delivered as required by this Agreement.
6. Miscellaneous.
6.1 Successors and Assigns. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement. The Warrant cannot be assigned
by AC without the express written consent of the Company, except when such
assignment is to an affiliate of AC.
6.2 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of California as applied to agreements among
California residents, made and to be performed entirely within the State of
California.
6.3 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
6.4 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
6.5 Notices. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified, by
delivery by confirmed facsimile or upon deposit with the United States Post
Office, by registered or certified mail, postage prepaid and addressed to such
party at the address set forth below, or at such other address as such party may
designate by ten (10) days' advance written notice to the other parties.
If to the Company:
Software Technologies Corporation
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: Chief Executive Officer
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
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If to AC:
▇▇▇▇▇▇▇▇ Consulting LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Facsimile:
6.6 Finder's Fee. Each party represents that it neither is or will
be obligated for any finder's fee or commission in connection with this
transaction. AC agrees to indemnify and to hold harmless the Company from any
liability for any commission or compensation in the nature of a finder's fee
(and the costs and expenses of defending against such liability or asserted
liability) for which AC or any of its officers, partners, employees, or
representatives is responsible.
The Company agrees to indemnify and hold harmless AC from any
liability for any commission or compensation in the nature of a finder's fee
(and the costs and expenses of defending against such liability or asserted
liability) for which the Company or any of its officers, employees, or
representatives is responsible.
6.7 Expenses. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
6.8 Entire Agreement; Amendments and Waivers. This Agreement and the
Warrant constitute the full and entire understanding and agreement between the
parties with regard to the subjects hereof and thereof. Any term of this
Agreement may be amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively), with the written consent of the Company and AC. Any waiver or
amendment effected in accordance with this Section shall be binding upon AC,
each holder of any securities purchased under this Agreement at the time
outstanding (including securities into which such securities have been
converted), each future holder of all such securities, and the Company.
6.9 Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
SOFTWARE TECHNOLOGIES CORPORATION
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Chief Executive Officer
Address: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SIGNATURE PAGE TO SOFTWARE TECHNOLOGIES CORPORATION
WARRANT PURCHASE AGREEMENT
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▇▇▇▇▇▇▇▇ CONSULTING LLP
By:
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Name:
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Title:
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Address: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
SIGNATURE PAGE TO SOFTWARE TECHNOLOGIES CORPORATION
WARRANT PURCHASE AGREEMENT