Exhibit 10.30
HEALTHGATE DATA CORP.
WARRANT PURCHASE AGREEMENT
June 11, 1999
WARRANT PURCHASE AGREEMENT
This Warrant Purchase Agreement (this "Agreement"), is made as of June 11,
1999 by and between HealthGate Data Corp., Inc., a Delaware corporation (the
"COMPANY") and General Electric Company, a New York Corporation or one or more
of its affiliates (the "Purchaser").
RECITALS
WHEREAS, the Purchaser and the Company are contemporaneously entering into
a Distribution Agreement of even date herewith (the "DISTRIBUTION AGREEMENT");
and
WHEREAS, as a material condition to the Purchaser's willingness to enter
into the Distribution Agreement, the Company has agreed to issue to the
Purchaser a warrant to purchase shares of capital stock of the Company, subject
to the terms and conditions of this Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1 ISSUANCE OF WARRANT. Subject to the terms and conditions hereof, on
the date of the execution of this Agreement or such later date as the conditions
to closing herein are satisfied (the "Closing"), the Company shall issue to the
Purchaser, and the Purchaser shall accept from the Company, the Warrant in the
form attached as EXHIBIT A hereto.
2. DELIVERIES TO BE MADE AT THE CLOSING.
2.1. AGREEMENTS TO BE EXECUTED. The following documents shall be
executed prior to or simultaneously with the Closing:
(i) DISTRIBUTION AGREEMENT. The Company and the Purchaser will
have entered into a Distribution Agreement, in substantially the form set
forth in EXHIBIT B attached hereto (the "DISTRIBUTION AGREEMENT"), and the
Distribution Agreement will be in full force and effect as of the Closing.
(ii) REGISTRATION AGREEMENT. The Company and the Purchaser will
have entered into a Registration Agreement in substantially the form set
forth in Exhibit C attached hereto (the "REGISTRATION AGREEMENT") and the
Registration Agreement will be in full force and effect as of the Closing
and the Company shall have obtained any requisite consents, agreements or
waivers from the stockholders of the Company on or prior to the Closing.
(iii) STOCKHOLDERS AGREEMENT. The Company and the other parties
to the Amended and Restated Stockholders Agreement dated April 7, 1999
shall have executed and delivered an amendment to the Stockholders
Agreement adding Purchaser to such agreement, including tag-along rights
for Purchaser equivalent to those granted to GE Capital therein with
respect to the Common Stock and extending such rights for a term ending
upon the consummation of an IPO or the expiration of the 5 year term hereof
(the "STOCKHOLDERS AGREEMENT").
(iv) LOCK-UP AGREEMENT. The Purchaser shall have executed and
delivered to the Company a Lock-up Agreement in substantially the form
attached hereto as Exhibit D.
2.2 CLOSING DOCUMENTS. The Company will deliver, or cause to be
delivered, to the Purchaser all of the following documents:
(i) the opinion of Rich, May, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C., counsel
for the Company, which shall be in the form set forth in EXHIBIT E
attached hereto and which will be addressed to the Purchaser and dated
the date of the Closing;
(ii) certified copies of the resolutions duly adopted by the
Company's board of directors authorizing the execution, delivery and
performance of this Agreement, the Registration Agreement, the
Stockholders Agreement and each of the other agreements contemplated
hereby, the issuance and sale of the Warrant, the reservation for
issuance of 300,000 shares of Common Stock for issuance upon exercise
of the Warrant, and all other transactions contemplated by this
Agreement;
(iii) certified copies of the Certificate of Incorporation and
the Company's bylaws, each as in effect as of the Closing; and
(iv) such other documents relating to the transactions
contemplated by this Agreement as the Purchaser or its counsel may
reasonably request.
3. COVENANTS. The rights of the Purchaser under Article 3 (other than
Sections 3.1(vii), 3.4, 3.5, 3.6 and 3.8) shall terminate at the earlier of such
time as the Company consummates an IPO or the Warrant is exercised in full or
terminated.
3.1 FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company will,
upon the written request of the Purchaser, deliver to the Purchaser (so long as
the Purchaser holds any portion of the Warrant and this covenant is in effect,
except the Company shall have no such obligation while its Registration
Statement on Form S-1 (No. 333-76899) is on file with the SEC and has not been
abandoned or withdrawn) and to each transferee of the Purchaser who has acquired
and holds the Warrant
(i) as soon as available but in any event within 30 days after
the end of each monthly accounting period in each fiscal year, (a)
unaudited consolidated statements of income and cash flows and changes
in consolidated financial position of the Company and its Subsidiaries
for such monthly period and for the period from the beginning of the
fiscal year to the end of such monthly period and consolidated balance
sheets of the Company and its Subsidiaries as of the end of such
monthly period, setting forth in each case comparisons to the annual
budget
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and to the corresponding period in the preceding fiscal year, all
prepared in accordance with generally accepted accounting principles,
consistently applied, and (b) a management summary of the month's
events including new business development, material legal matters,
bookings, backlogs, staffing levels, and sales projections;
(ii) accompanying the statements referred to in subparagraph (i),
an Officer's Certificate stating that there is no Event of
Noncompliance in existence and that there has occurred no event of
default under any other material agreement to which the Company or any
of its Subsidiaries is a party or, if any Event of Noncompliance or
any such event of default exists, specifying the nature and period of
existence thereof, and what actions the Company and its Subsidiaries
have taken and propose to take with respect thereto;
(iii) as soon as practicable and in any event within 90 days
after the end of each fiscal year, audited consolidated statements of
income and cash flows and changes in financial position of the Company
and its Subsidiaries for such fiscal year, and consolidated balance
sheets of the Company and its Subsidiaries as of the end of such
fiscal year, setting forth in each case comparisons to the preceding
fiscal year, all prepared in accordance with generally accepted
accounting principles, consistently applied, and accompanied by, with
respect to the consolidated portions of such statements, an audit
opinion by a Big Five public accounting firm selected by the Company;
(iv) promptly upon receipt thereof, a copy of the annual
management letter of the Company's independent accountants to the
Company's board of directors and any additional reports, management
letters or other detailed information concerning significant aspects
of the Company's operations and financial affairs given to the Company
by its independent accountants (and not otherwise contained in other
materials provided hereunder);
(v) at least 30 days prior to the end of each fiscal year, an
annual operating budget prepared on a monthly basis for the Company
and its Subsidiaries for the succeeding fiscal year (displaying
anticipated statements of income, changes in financial position and
balance sheets) and an annual budget for capital expenditures of the
Company and its Subsidiaries, which budgets shall be approved by the
Company's board of directors, and promptly upon preparation thereof
any other significant budgets which the Company prepares, and any
revisions of such annual or other budgets;
(vi) promptly (but in any event within five business days) after
the discovery or receipt of notice of any Event of Noncompliance, any
event of default under any material agreement to which it or any of
its Subsidiaries is a party, or any other material adverse event or
circumstance affecting the Company or any Subsidiary (including the
filing of any material litigation against the Company or
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any Subsidiary which, if determined adversely, would have a material
adverse effect on the business, assets, financial condition, results
of operations or prospects of the Company and its Subsidiaries taken
as a whole), an Officer's Certificate specifying the nature and period
of existence thereof and what actions the Company and its Subsidiaries
have taken and propose to take with respect thereto;
(vii) promptly upon transmission thereof, copies of the Company's
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Annual
Reports to Stockholders filed with the Securities and Exchange
Commission; and
(viii) with reasonable promptness, such other information and
financial data concerning the Company as any Person entitled to
receive materials under this Section 3.1 may reasonably request.
Except as otherwise required by law or judicial order or decree or by any
governmental regulatory agency or authority, the Purchaser and each Person
receiving information regarding the Company pursuant to Sections 3.1 or 3.2 will
use commercially reasonable efforts to maintain the confidentiality of all
nonpublic information obtained by it hereunder which the Company has reasonably
designated as proprietary or confidential in nature; provided that each such
Person may disclose any financial information regarding the Company and its
Subsidiaries in connection with the transfer of the Warrant or Underlying Common
Stock if such Person's transferee agrees in writing to be bound by the
provisions hereof. As a condition to disclosure of such information to any
Person other than the Purchaser, the Company may request receipt of written
confirmation by such Person that such Person will abide by the foregoing
confidentiality provisions.
3.2 INSPECTION OF PROPERTY. The Company will permit any
representatives designated by any Person (so long as the Purchaser holds any
portion of the Warrant and this covenant is in effect, except the Company shall
have no such obligation while its Registration Statement on Form S-1 (No.
333-76899) is on file with the SEC and has not been abandoned or withdrawn) upon
reasonable notice and during normal business hours, to (i) visit and inspect any
of the properties of the Company, (ii) examine the corporate and financial
records of the Company and make copies thereof or extracts therefrom and (iii)
discuss the affairs, finances and accounts of the Company and its Subsidiaries
with the directors, officers, key employees and independent accountants of the
Company, in each case subject to the confidentiality provisions of the last
subsection of Section 3.1 and provided that such visits, inspections,
examinations and discussions will be at the Purchaser's expense and will not
unreasonably interfere with the Company's normal business operations and that
the Company will not be required to disclose hereunder any technical proprietary
information relating to its business.
3.3 AFFIRMATIVE COVENANTS. The Company will, and will cause each
Subsidiary to:
(i) at all times cause to be done all things reasonably necessary to
maintain, preserve and renew its corporate existence and all material
licenses, authorizations and permits necessary to the conduct of its
businesses;
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(ii) maintain and keep its properties in good repair, working order
and condition, ordinary wear and tear excepted, and from time to time make
all necessary or desirable repairs, renewals and replacements, so that its
businesses may be properly and advantageously conducted at all times,
except where the failure to so comply would not have a material adverse
effect on the business, assets, financial condition, results of operations
or prospects of the Company and its Subsidiaries taken as a whole;
(iii) pay and discharge when payable all taxes, assessments and
governmental charges imposed upon its properties or upon the income or
profits therefrom (in each case before the same become delinquent and
before penalties accrue thereon) and all claims for labor, materials or
supplies which if unpaid might by law become a lien upon any of its
property, to the extent to which the failure to so pay or discharge might
reasonably be expected to have a material adverse effect upon the business,
assets, financial condition, results of operations or prospects of the
Company and its Subsidiaries taken as a whole, unless and to the extent
that the same are being contested in good faith and by appropriate
proceedings and adequate reserves (as determined in accordance with
generally accepted accounting principles, consistently applied) have been
established on its books with respect thereto;
(iv) comply with all other obligations which it incurs pursuant to any
contract or agreement, whether oral or written, express or implied, as such
obligations become due to the extent to which the failure to so comply
might reasonably be expected to have a material adverse effect upon the
business, assets, financial condition, results of operations or prospects
of the Company and its Subsidiaries taken as a whole, unless and to the
extent that the same are being contested in good faith and by appropriate
proceedings and adequate reserves (as determined in accordance with
generally accepted accounting principles, consistently applied) have been
established on its books with respect thereto;
(v) comply with all applicable laws, rules, regulations and orders of
all domestic and foreign governmental authorities, including, without
limitation, the Foreign Corrupt Practices Act, the violation of which might
reasonably be expected to have a material adverse effect upon the business,
assets, financial condition, results of operations or prospects of the
Company and its Subsidiaries taken as a whole;
(vi) apply for and use its best efforts to continue in force with
responsible insurance companies adequate insurance covering risks of such
types and in such amounts as are customary for corporations of similar size
engaged in similar lines of business and, without limiting the foregoing,
maintain "key man" life insurance covering ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (so long as
such individual is an employee of the Company) and naming the Company as
beneficiary in the amount of $1,000,000 for each such policy, the proceeds
of which will be available for general corporate purposes of the Company;
and
(vii) maintain proper books of record and account which fairly present
its financial condition and results of operations and make provisions on
its financial statements
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for all such proper reserves as in each case are required in accordance
with generally accepted accounting principles, consistently applied.
3.4 COMPLIANCE WITH AGREEMENTS. The Company will use its best efforts
to perform and observe (i) all of its obligations to the Warrant Holders and all
of its obligations to each holder of the Underlying Common Stock including those
under the Stockholders Agreement and (ii) all of its obligations to each holder
of Registrable Securities set forth in the Registration Agreement.
3.5 CURRENT PUBLIC INFORMATION. At all times after the Company has
filed a registration statement with the Securities and Exchange Commission
pursuant to the requirements of either the Securities Act or the Securities
Exchange Act, the Company will file all reports required to be filed by it under
the Securities Act and the Securities Exchange Act and the rules and regulations
adopted by the Securities and Exchange Commission thereunder, and will take such
further action as any holder or holders of Restricted Securities may reasonably
request, all to the extent required to enable such holders to sell Restricted
Securities pursuant to Rule 144 adopted by the Securities and Exchange
Commission under the Securities Act (as such rule may be amended from time to
time) or any similar rule or regulation hereafter adopted by the Securities and
Exchange Commission.
3.6 RESERVATION OF COMMON STOCK. The Company will at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, solely for the purpose of issuance upon the exercise of the Warrant,
300,000 shares of Common Stock. All shares of Common Stock which are so issuable
will, when issued, be duly and validly issued, fully paid and nonassessable and
free from all taxes, liens and charges. The Company will take all such actions
as may be necessary to assure that all such shares of Common Stock may be so
issued without violation of any applicable law or governmental regulation or any
requirements of any domestic securities exchange upon which shares of stock may
be listed (except for official notice of issuance which will be promptly
transmitted by the Company upon issuance).
3.7 PROPRIETARY RIGHTS. The Company will, and will cause each
Subsidiary to, use its best efforts to possess and maintain all material
Proprietary Rights which the Company deems necessary to the conduct of their
respective businesses and own all right, title and interest in and to, or have a
valid license or right for, all material Proprietary Rights used by the Company
or any Subsidiary in the conduct of their respective businesses.
3.8 PUBLIC DISCLOSURES. The Company will not, nor will it permit any
Subsidiary to, disclose the Purchaser's name or identity as an investor in the
Company in any press release or other public announcement or in any document or
material filed with any governmental entity, without the prior written consent
of the Purchaser, unless such disclosure is required by applicable law or
governmental regulations or by order of a court of competent jurisdiction in
which case prior to making such disclosure the Company will use reasonable
efforts to give written notice to the Purchaser describing in reasonable detail
the proposed content of such disclosure and will permit the Purchaser to review
and comment upon the form and substance of such disclosure. Notwithstanding the
foregoing, the Company may describe its strategic affiliation with the
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Purchaser and GE Medical Systems in the Company's filings with the SEC provided
that it obtains the Purchaser's or GE Medical Systems prior review (which shall
be provided promptly) and written consent, which consent shall not be
unreasonably withheld.
3.9 CONTENT RESTRICTIONS. Neither the Company nor any of its
Subsidiaries will host, display, provide or aggregate non-healthcare information
on its proprietary and customer websites that might be considered pornographic,
lewd or obscene in nature. The Purchaser acknowledges that future issues of
"Healthy Sexuality" which are consistent with the format, content and tone of
issues prior to the date of this Agreement shall not constitute a breach of this
Section 3.9.
3.10 ERISA. Neither the Company nor any Subsidiary shall incur any
material liability with respect to retiree medical or death benefits or unfunded
benefits payable after termination of employment. All employee benefit plans and
arrangements maintained or contributed to by the Company, any Subsidiary or any
ERISA Affiliate shall be maintained in compliance in all material respects with
all applicable law, including any reporting requirements. With respect to any
plan maintained by or contributed to by the Company or any Subsidiary, neither
the Company nor any Subsidiary will fail to make any contribution due from it
under the terms of such plan or as required by law. An "ERISA Affiliate" for
purposes of this Section is any trade or business, whether or not incorporated,
which, together with the Company, is under common control, as described in
Section 414(b) or (c) of the Code.
3.11 BEST EFFORTS. The Company will take or cause to be taken all
actions and make or cause to be made all filings necessary or appropriate in
connection with the consummation of the transactions contemplated by this
agreement and the performance of the Company's obligations hereunder.
4. TRANSFER OF RESTRICTED SECURITIES.
(i) Restricted Securities are transferable pursuant to (a) public
offerings registered under the Securities Act, (b) Rule 144 of the
Securities and Exchange Commission (or any similar rule then in force) if
such rule is available, (c) to any Affiliate of the Purchaser and (d)
subject to the conditions specified in subparagraph (ii) below, any other
legally available means of transfer;
(ii) In connection with the transfer of any Restricted Securities
(other than a transfer described in Section 4(i)(a), (b) or (c) above), the
holder thereto will deliver written notice to the Company describing in
reasonable detail the transfer or proposed transfer, together with an
opinion of counsel which (to the Company's reasonable satisfaction) is
knowledgeable in securities law matters (an "Approved Counsel") to the
effect that such transfer of Restricted Securities may be effected without
registration of such Restricted Securities under the Securities Act. In
addition, if the holder of the Restricted Securities delivers to the
Company an opinion of an Approved Counsel that no subsequent transfer of
such Restricted Securities will require registration under the Securities
Act, the Company
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will promptly upon such contemplated transfer deliver new certificates for
such Restricted Securities which do not bear the Securities Act legend set
forth in Section 7.3. If the Company is not required to deliver new
certificates for such Restricted Securities not bearing such legend, the
holder thereof will not transfer the same until the prospective transferee
has confirmed to the Company in writing its agreement to be bound by the
conditions contained in this Section and Section 7.3.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. As a material
inducement to the Purchaser to enter into this Agreement and purchase the
Warrant, the Company hereby represents and warrants to Purchaser as of the date
of this Agreement (unless made as of a specific date) that:
5.1 ORGANIZATION AND CORPORATE POWER. Each of the Company and its
Subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated and is
duly qualified to do business in every jurisdiction in which its ownership of
property or its conduct of business requires it to qualify. The Company has all
requisite corporate power and authority and all material licenses, permits and
authorizations necessary to own and operate its properties, to carry on its
business as now conducted and presently proposed to be conducted and to carry
out the transactions contemplated by this Agreement. The copies of the Company's
and each Subsidiary's charter documents and bylaws, which have been furnished to
the Purchaser's counsel, reflect all amendments made thereto at any time prior
to the date of this Agreement and are correct and complete.
5.2 CAPITAL STOCK AND RELATED MATTERS. As of the Closing and
immediately thereafter, the authorized capital stock of the Company will consist
of (i) 1,000 shares of Series A Convertible Preferred Stock, $.01 par value (the
"Series A Preferred"), 1,000 of which are issued and outstanding, (ii) 1,000
shares of Series B Convertible Preferred Stock, $.01 par value (the "Series B
Preferred"), 1,000 of which are issued and outstanding, (iii) 1,000 shares of
the Series C Convertible Preferred Stock, $.01 par value (the "Series C
Preferred"), 1,000 of which are issued and outstanding, (iv) 1,667 shares of the
Series D Convertible Preferred Stock, $.0l par value (the "Series D Preferred"),
1,667 of which are issued and outstanding, (v) 829,962 shares of Series E
Preferred, 720,757 of which are issued and outstanding and (vi) 20,000,000
shares of Common Stock, of which 1,146,895 shares are issued and outstanding,
304,950 shares have been reserved for issuance upon conversion of the Series A
Preferred and 399,400 shares have been reserved for issuance upon conversion of
the Series B Preferred and 138,650 shares have been reserved for issuance upon
conversion of the Series C Preferred and 335,100 shares have been reserved for
issuance upon conversion of the Series D Preferred and 720,757 shares have been
reserved for issuance upon conversion of the Series E Preferred and 300,000
shares have been reserved for the issuance by all necessary corporate action
upon exercise of the Warrant. The 300,000 shares of Common Stock reserved for
issuance upon exercise of the Warrant will represent, as of the Closing, in
excess of 7.19% of the Company's Common Stock and options on a Fully-Diluted
Basis, as set forth in EXHIBIT F hereto. As of the Closing, neither the Company
nor any Subsidiary will have outstanding any stock or securities convertible or
exchangeable for any shares of its capital stock, nor will it have outstanding
any rights or options to subscribe for or to purchase its capital stock or any
stock or securities convertible into or exchangeable for its
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capital stock, except for the Series A Preferred, the Series B Preferred, the
Series C Preferred, the Series D Preferred, and the Series E Preferred and
except for this Warrant and any options, rights or warrants to purchase shares,
of capital stock of the Company issued to members of the board of directors,
employees, consultants and advisors of the Company, and GE Capital Equity
Investments, Inc. as more fully set forth on SCHEDULE 5.2 attached hereto. As of
the Closing, neither the Company nor any Subsidiary will be subject to any
obligation (contingent or otherwise) to repurchase or otherwise acquire or
retire any shares of its capital stock, except pursuant to the Certificate of
Incorporation. As of the Closing, all of the outstanding shares of the Company's
capital stock will be validly issued, fully paid and nonassessable.
5.3 SUBSIDIARIES. Except as set forth on SCHEDULE 5.3 attached
hereto, the Company does not own or hold any rights to acquire any shares of
stock or any other security or interest in any other Person.
5.4 AUTHORIZATION: NO BREACH. The execution, delivery and performance
of this Agreement, the Registration Agreement and the Stockholders Agreement and
all other agreements contemplated hereby and thereby, the transactions
contemplated hereby and thereby have been duly authorized by the Company and are
within the corporate power and authority of the Company. As of the date of their
execution and delivery by the Company, this Agreement, the Registration
Agreement, the Stockholders Agreement and all other agreements contemplated
hereby will be duly executed and delivered by the Company and each will
constitute a valid and binding obligation of the Company, enforceable in
accordance with its terms; except that such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally. The execution and
delivery by the Company of this Agreement, the Registration Agreement, the
Stockholders Agreement and all other agreements contemplated hereby and thereby,
the offering, sale and issuance of the Warrant hereunder, the issuance of the
Common Stock upon exercise of the Warrant do not and will not (i) conflict with
or result in a breach of the terms, conditions or provisions of, (ii) constitute
a default under, (iii) result in the creation of any lien, security interest,
charge or encumbrance upon the Company's or any Subsidiary's capital stock or
assets pursuant to, (iv) give any third party the right to accelerate any
obligation under, (v) result in a violation of, or (vi) require any
authorization, consent, approval, exemption or other action by or notice to any
court or administrative or governmental body pursuant to, the Certificate of
Incorporation or bylaws of the Company or any Subsidiary, or any law, statute,
rule or regulation to which the Company or any Subsidiary is subject, or any
agreement, instrument, order, judgment or decree to which the Company or any
Subsidiary is subject.
5.5 FINANCIAL STATEMENTS; BOOKS AND RECORDS. The audited consolidated
balance sheets of the Company and its Subsidiaries as of December 31, 1998 and
1997 and the related audited consolidated statements of income and cash flows
for each of the years ended December 31, 1998, 1997 and 1996 have been
previously delivered to Purchaser. Such financial statements (including the
notes thereto, if any) were prepared in accordance with GAAP, are accurate and
complete in all material respects, are in accordance with the books and records
of the Company. All the books, records and accounts of the Company and its
Subsidiaries are in all material respects true and complete, are maintained in
accordance with good business practice and
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all laws applicable to its business, and accurately present and reflect in all
material respects all of the transactions therein described. The Company has
previously delivered to the Purchaser true, correct and complete texts of all of
the minutes relating to meetings of the stockholders, board of directors and
committees of the board of directors of the Company and each Subsidiary since
their respective dates of incorporation.
5.6 ABSENCE OF UNDISCLOSED LIABILITIES. Neither the Company nor any
of its Subsidiaries has any material obligation or liability (whether accrued,
absolute, contingent, unliquidated or otherwise, whether or not known to the
Company, whether due or to become due) arising out of transactions entered into
at or prior to the Closing, or any action or inaction at or prior to the
Closing, or any state of facts existing at or prior to the Closing, other than:
(i) liabilities set forth on the Latest Balance Sheet (including the notes
thereto), (ii) liabilities and obligations which have arisen after the date of
the Latest Balance Sheet in the ordinary course of business (none of which is a
liability resulting from breach of contract, breach of warranty, tort,
infringement, claim or lawsuit) or in connection with the transactions described
in this Agreement and (iii) other liabilities and obligations expressly
disclosed in the other Schedules to this Agreement.
5.7 NO MATERIAL ADVERSE CHANGE. Since January 1, 1999, there has been
no material adverse change in the Company's business, assets, financial
condition, results of operations, prospects, employee relations, customer
relations or otherwise.
5.8 ABSENCE OF CERTAIN DEVELOPMENTS. Except as set forth on Schedule
5.8 hereto, the representations and warranties set forth in Section 6.8 of the
Stock Purchase Agreement dated as of April 5, 1999 between the Company, GE
Capital Equity Investments, Inc. and ▇▇▇▇▇▇▇▇▇ Science, Ltd. (the "April Stock
Purchase Agreement") remain true complete and correct in all material respects.
5.9 ASSETS. The Company and each Subsidiary have good and marketable
title to, or a valid and subsisting leasehold interest in, the properties and
assets used by them, located on their premises or shown on the Latest Balance
Sheet or acquired thereafter, free and clear of all liens, security interests,
charges and encumbrances, except as disclosed on the Latest Balance Sheet
(including the notes thereto). The Company's and each Subsidiary's buildings,
equipment and other tangible assets are in good operating condition in all
material respects and are fit for use in the ordinary course of business.
5.10 TAX MATTERS. The Company and each Subsidiary have filed or caused
to be filed all tax returns which they are required to file; all such returns
are true and correct in all material respects; the Company and each Subsidiary
have paid all taxes owed by them or which they are obligated to withhold from
amounts owing to any employee, creditor or third party; neither the Company nor
any Subsidiary has waived any statute of limitations with respect to taxes or
agreed to any extension of time with respect to a tax assessment or deficiency;
the assessment of any additional taxes for periods for which returns have been
filed is not expected; and there are no material unresolved questions or claims
concerning the Company's or any Subsidiary's tax liability. The Company and its
Subsidiaries have paid or caused to be paid, or have established reserves that
the Company reasonably believes to be adequate, for all federal income tax
liabilities and state
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income tax liabilities applicable to the Company or any of its Subsidiaries for
all fiscal years which have not been examined and reported on by the taxing
authorities. For the purpose of this Agreement, "tax" or "taxes" means any
federal, state, local or foreign income, gross receipts, windfall profits,
severance, property, production, sales, use, transfer, gains, license, excise,
employment, payroll, withholding, value added, estimated, alternative or add on
minimum tax, or any other tax, custom, duty, governmental fee or other like
assessment or charge of any kind whatsoever, together with any interest or any
penalty, addition to tax or additional amount imposed by any governmental
authority.
5.11 CONTRACTS AND COMMITMENTS. Except as set forth on Schedule 5.11
hereto, the representations and warranties set forth in Section 6.11 of the
April Stock Purchase Agreement remain true complete and correct in all material
respects.
5.12 PROPRIETARY RIGHTS. The Company and its Subsidiaries possess all
material Proprietary Rights necessary to the present and contemplated conduct of
their respective businesses and (i) the Company and its Subsidiaries own all
right, title, and interest in and to all of such Proprietary Rights, (ii) there
have been no claims made against the Company or any Subsidiary for the assertion
of the invalidity, abuse, misuse, or unenforceability of any of such rights, and
there are, to the best of the Company's knowledge, no grounds for the same,
(iii) neither the Company nor any Subsidiary has received a notice of conflict
with the asserted rights of others within the last five years, and (iv) the
conduct of the Company's and each Subsidiary's business has not, to the best of
the Company's knowledge, infringed any such rights of others. Each employee or
consultant of the Company or any Subsidiary is a party to a confidentiality
agreement relating to the business of the Company and its Subsidiaries. Each
technical employee or consultant of the Company or any Subsidiary, excluding
consultants hired for intellectual property expertise in a particular topic
distinct from the Company's business, is a party to an invention assignment
agreement relating to the business of the Company and its Subsidiaries.
5.13 LITIGATION, ETC. Except as set forth in SCHEDULE 5.13, there are
no actions, suits, proceedings, orders, investigations or claims pending or, to
the best of the Company's knowledge, threatened against or affecting the Company
or any Subsidiary at law or in equity, or before or by any governmental
department, commission, board, bureau, agency or instrumentality; neither the
Company nor any Subsidiary is subject to any arbitration proceedings under
collective bargaining agreements or otherwise or, to the best of the Company's
knowledge, any governmental investigations or inquiries (including inquiries as
to the qualification to hold or receive any license or permit); and, to the best
of the Company's knowledge, there is no basis for any of the foregoing. Neither
the Company nor any of its Subsidiaries is in default in any material respect
with respect to any judgment, order, writ, injunction, decree or award.
5.14 BROKERAGE. There are no claims for brokerage commissions,
finders' fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement binding
upon the Company or any Subsidiary; provided, however, that this representation
excludes any claim arising out of or due to any action of the Purchaser. The
Company will pay, and hold the Purchaser harmless against, any liability, loss
or expense
11
(including, without limitation, reasonable attorneys' fees and out-of-pocket
expenses) arising in connection with any such claim.
5.15 GOVERNMENTAL CONSENT, ETC. No permit, consent, approval or
authorization of, or declaration to or filing with, any governmental authority
is required in connection with the valid execution, delivery and performance by
the Company of this Agreement or the other agreements contemplated hereby, or
the consummation by the Company of any other transactions contemplated hereby or
thereby.
5.16 INSURANCE. The representations and warranties set forth in
Section 6.16 of the April Stock Purchase Agreement remain true complete and
correct in all material respects.
5.17 EMPLOYEES AND ERISA.
(i) The Company is not aware that any executive or key employee of
the Company or any Subsidiary or any group of employees of the Company or
any Subsidiary has any plans to terminate employment with the Company or
any Subsidiary, the Company and each Subsidiary have complied in all
material respects with all laws relating to the employment of labor,
including provisions thereof relating to wages, hours, equal opportunity,
collective bargaining and the payment of social security and other taxes,
and the Company is not aware that it or any Subsidiary has any material
labor relations problems.
(ii) Neither the Company, its Subsidiaries nor any of their respective
employees is a party to any consulting or employment agreements containing
any non-compete or confidentiality provisions relating to the present or
proposed business activities of the Company and its Subsidiaries;
(iii) Neither the Company nor any Subsidiary presently maintains or
contributes to, or ever has maintained or contributed to, any "employee
benefit plan," as such term is defined in Section 3 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), with respect
to which the Company is required to file Internal Revenue Service Form
5500, and neither the Company nor any Subsidiary presently contributes to
or ever has contributed to any "multiemployer plan," as such term is
defined in Section 3 of ERISA.
5.18 COMPLIANCE WITH LAWS. Neither the Company nor any Subsidiary is
in violation of any domestic or foreign law or any regulation or requirement,
including without limitation, the Foreign Corrupt Practices Act, which violation
might reasonably be expected to have a material adverse effect upon the
business, assets, financial condition, result of operations or prospects of the
Company and its Subsidiaries, and neither the Company nor any Subsidiary has
received notice of any such violation.
5.19 DISCLOSURE. Neither this Agreement nor any of the schedules,
attachments, written statements, documents, certificates or other items prepared
or supplied to the Purchaser by
12
or on behalf of the Company with respect to the transactions contemplated hereby
contain any untrue statement of a material fact or omit a material fact
necessary to make each statement contained herein or therein not misleading.
There is no fact which the Company has not disclosed to the Purchaser in writing
and of which any of its officers, directors or executive employees is aware and
which could reasonably be anticipated to have a material adverse effect upon the
existing or expected financial condition, operating results, assets, customer
relations, employee relations or business prospects of the Company and its
Subsidiaries.
5.20 POSSESSION OF FRANCHISES, LICENSES, ETC. The Company and its
Subsidiaries possess all franchises, certificates, licenses, permits and other
authorizations from governmental or political subdivisions or regulatory
authorities that are necessary in any material respect to the Company or any of
its Subsidiaries for the ownership, maintenance and operation of their
respective properties and assets, and neither the Company nor any of its
Subsidiaries is in violation of any thereof in any material respect.
5.21 HOLDING COMPANY ACT AND INVESTMENT COMPANY ACT. Neither the
Company nor any Subsidiary is: (i) a "public utility company" or a "holding
company," or an "affiliate" or a "subsidiary company" of a "holding company," or
an "affiliate" of such a "subsidiary company," as such terms are defined in the
Public Utility Holding Company Act of 1935, as amended, or (ii) a "public
utility," as defined in the Federal Power Act, as amended, or (iii) an
"investment company" or an "affiliated person" thereof or an "affiliated person"
of any such "affiliated person," as such terms are defined in the Investment
Company Act of 1940, as amended.
5.22 ENVIRONMENTAL AND OTHER REGULATIONS. The Company and its
Subsidiaries are in compliance with all applicable federal, state, local and
foreign laws and regulations relating to protection of the environment and human
health, and are in compliance in all material respects with all other applicable
federal, state, local and foreign laws and regulations, including, without
limitation, those relating to equal employment opportunity and employment
safety. There are no claims, notices, civil, criminal or administrative actions,
suits, hearings, investigations, inquiries or proceedings pending or, to the
best knowledge of the Company, threatened against the Company or any Subsidiary
that are based on or related to any environmental matters, including any
disposal of hazardous substances at any place, or the failure to have any
required environmental permits, and there are no past or present conditions that
are likely to give rise to any liability or other obligations of the Company or
any Subsidiary under any environmental laws.
5.23 YEAR 2000. The representations and warranties set forth in
Section 6.24 of the April Stock Purchase Agreement remain true complete and
correct in all material respects.
6. DEFINITIONS. For the purposes of this Agreement, the following terms
have the meanings set forth below:
"AFFILIATE" shall have the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations under the Securities Exchange Act of 1934,
as amended.
13
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"COMMON STOCK" means the Company's common stock, $.01 par value per
share, having the rights set forth in Article 4 of the Certificate of
Incorporation.
"CONSOLIDATED NET WORTH" means the consolidated stockholders' equity
of the Company determined in accordance with generally accepted accounting
principles consistently applied.
"CONVERTIBLE SECURITIES" means evidences of indebtedness, capital
shares or other securities which are convertible into or exchangeable for, with
or without payment of additional consideration, shares of Common Stock, either
immediately or upon the arrival of a specified date or the happening of a
specified event.
"EVENT OF NONCOMPLIANCE" means any instance of the Company's failure,
under the provisions of the Certificate of Incorporation, to perform its
obligations to the holders of Series A Preferred, Series B Preferred, Series C
Preferred, Series D Preferred or Series E Preferred.
"FACILITIES" means any facilities or equipment used by the Company or
its Subsidiaries in any location, including HVAC systems, mechanical systems,
elevators, security systems, fire suppression systems, telecommunications
systems, fax machines, copy machines, and equipment, whether or not owned by the
Company or its Subsidiaries.
"FULLY DILUTED BASIS" means the number of shares of Common Stock
outstanding, plus (x) the number of shares of Common Stock into which all
outstanding Convertible Securities of the Company would be convertible and (y)
the number of shares of Common Stock which would be issuable upon the exercise
of all warrants, rights or options to purchase shares of Common Stock then
outstanding.
"GAAP" means the generally accepted accounting principles in the
United States.
"INTERNAL MIS SYSTEMS" means any computer software and systems
(including hardware, firmware, operating system software, utilities, and
applications software) used in the ordinary course of business by or on behalf
of the Company or its Subsidiaries, including the Company's and its
Subsidiaries' payroll, accounting, billing/receivables, inventory, asset
tracking, customer service, human resources, and e-mail systems.
"INVESTMENT" as applied to any Person means (i) any direct or indirect
purchase or other acquisition by such Person of any note, stock, securities or
other ownership interest in any other Person and (ii) any capital contribution
by such Person to any other Person.
"OFFERING PRICE" means the price at which a share of the Company's
Common Stock will be offered at the Public Offering.
14
"OFFICER'S CERTIFICATE" means a certificate signed by the Company's
president or its chief financial officer, stating that (i) the officer signing
such certificate has made or has caused to be made such investigations as are
necessary in order to permit him to verify the accuracy of the information set
forth in such certificate and (ii) to the best of such officer's knowledge, such
certificate does not misstate any material fact and does not omit to state any
fact necessary to make the certificate not misleading.
"PERSON" means an individual, a partnership, a corporation, limited
liability company, limited liability partnership, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.
"PRODUCTS" means any products offered or furnished by the Company or
any of its Subsidiaries, or any predecessor in interest of the Company or any of
its Subsidiaries, currently or at any time in the past, including without
limitation each item of hardware, software, or firmware; any system, equipment,
or products consisting of or containing one or more thereof; and any and all
enhancements, upgrades, customizations, modifications, and maintenance thereto.
"PROPRIETARY RIGHTS" means any patents, registered and common law
trademarks, service marks, trade names, copyrights, licenses and other similar
rights (including, without limitation, know-how, trade secrets and other
confidential information) and applications for each of the foregoing, if any.
"PUBLIC OFFERING" means a firm commitment underwritten public offering
of the Company's Common Stock pursuant to a registration statement filed with
the Securities and Exchange Commission in which the Company's common stock is
issued at a price that implies a Company post-closing equity value of at least
$150,000,000.
"RELATED PARTY" means any officer, director or beneficial holder of 5%
or more of the outstanding shares of capital stock of the Company, any spouse,
former spouse, child, parent, parent of a spouse, sibling or a grandchild of any
such officer, director or beneficial holder of the Company, and any Affiliate of
any of the foregoing persons.
"RESTRICTED SECURITIES" means (i) the Warrant issued hereunder, (ii)
the Common Stock issued upon exercise of the Warrant and (iii) any securities
issued with respect to the securities referred to in clauses (i) or (ii) above
by way of a stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization. As to
any particular Restricted Securities, such securities will cease to be
Restricted Securities when they have (a) been effectively registered under the
Securities Act and disposed of in accordance with the registration statement
covering them, (b) been transferred pursuant to Rule 144 or become eligible for
sale pursuant to Rule 144(k) (or any similar rule then in force) under the
Securities Act or (c) been otherwise transferred and new certificates for them
not bearing the Securities Act legend set forth in Section 7.3 have been
delivered by the Company in accordance with Section 5(ii). Whenever any
particular securities cease to be Restricted Securities, the holder
15
thereof will be entitled to receive from the Company, without expense, new
securities of like tenor not bearing a Securities Act legend of the character
set forth in Section 7.3.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar federal law then in force.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended, or any similar federal law then in force.
"SECURITIES AND EXCHANGE COMMISSION" includes any governmental body or
agency succeeding to the functions thereof.
"SERVICES" means any services offered or furnished by the Company or
any of its Subsidiaries, or any predecessor in interest of the Company or any of
its Subsidiaries, currently or at any time in the past.
"SUBSIDIARY" means any corporation of which the securities having a
majority of the ordinary voting power in electing the board of directors are, at
the time as of which any determination is being made, owned by the Company
either directly or through one or more Subsidiaries;
"UNDERLYING COMMON STOCK" means (i) the Common Stock issued or
issuable upon exercise of the Warrant and (ii) any Common Stock issued or
issuable with respect to the Common Stock referred to in clause (i) above by way
of stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. Any Person who
holds the Warrant will be deemed to be the holder of the Underlying Common Stock
obtainable upon exercise of the Warrant, regardless of any restriction on the
exercise of the Warrant. As to any particular shares of Underlying Common Stock,
such shares will cease to be Underlying Common Stock when they have (a) been
effectively registered under the Securities Act and disposed of in accordance
with the registration statement covering them, (b) been distributed to the
public pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act or (c) ceased to be Restricted Securities other than for the
reasons set forth in clauses (a) and (b).
"YEAR 2000 COMPLIANT" means that (1) the products, services, or other
item(s) at issue accurately process, provide and/or receive all date/time data
(including calculating, comparing, sequencing, processing and outputting)
within, from, into, and between centuries (including the twentieth and
twenty-first centuries and the years 1999 and 2000), including leap year
calculations, and (2) neither the performance nor the functionality nor the
Company's or any of its Subsidiaries' provision of the products, services, and
other item(s) at issue will be affected by any dates/times prior to, on, after,
or spanning January 1, 2000.
7. MISCELLANEOUS.
16
7.1 EXPENSES; INDEMNIFICATION.
(i) The Company agrees to pay the Purchaser $15,000 simultaneously
with the execution and delivery of the Warrant in compensation for certain
of the Purchaser's expenses incurred in connection herewith. In addition,
the Company agrees to pay the Purchaser for all costs and expenses of the
Purchaser relating to the enforcement of the rights granted under this
Agreement and the agreements contemplated hereby, if the Company is found
to have breached its obligations under any such agreement.
(ii) The Company further agrees to indemnify and save harmless the
Purchaser and its respective officers, directors, partners, employees,
trustees and agents, each person who controls the Purchaser within the
meaning of the Securities Act or the Exchange Act, from and against any and
all costs, expenses, damages or other liabilities resulting from any breach
of any representation, warranty, covenant or agreement set forth in this
Agreement, and the agreements contemplated hereby by the Company or any
legal, administrative or other proceedings brought by any third party
arising out of the transactions contemplated hereby and thereby; provided
that, if and to the extent that such indemnification is unenforceable for
any reason, the Company shall make the maximum contribution to the payment
and satisfaction of such indemnified liability which shall be permissible
under applicable laws.
(iii) The indemnified party under this Section 7.1 will, promptly
after the receipt of notice of the commencement of any action against such
indemnified party in respect of which indemnity may be sought from the
Company on account of an indemnity agreement contained in this Section 7.1,
notify the Company in writing of the commencement thereof. The omission of
any indemnified party so to notify the Company of any such action shall not
relieve the Company from any liability which it may have to such
indemnified party except to the extent the Company shall have been
prejudiced by the omission of such indemnified party so to notify the
Company, pursuant to this Section 7.1. In case any such action shall be
brought against any indemnified party and it shall notify the Company of
the commencement thereof, the Company shall be entitled to participate
therein and, to the extent that it may wish, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party, and after
notice from the Company to such indemnified party of its election so to
assume the defense thereof, the Company will not be liable to such
indemnified party under this Section 7.1 for any legal or other expense
subsequently incurred by such indemnified party in connection with the
defense thereof nor for any settlement thereof entered into without the
consent of the Company; provided that (i) if the Company shall elect not to
assume the defense of such claim or action or (ii) if the indemnified party
reasonably determines (x) that there may be a conflict between the
positions of the Company and of the indemnified party in defending such
claim or action or (y) that there may be legal defenses available to such
indemnified party different from or in addition to those available to the
Company, then separate counsel for the indemnified party shall be entitled
to participate in and conduct the defense, in the case of (i) and (ii)(x),
or such
17
different defenses, in the case of (ii)(y), and the Company shall be liable
for any reasonable legal or other expenses incurred by the indemnified
party in connection with the defense.
7.2 REMEDIES. The Purchaser will have all rights and remedies set
forth in this Agreement, the Registration Agreement and the Stockholders
Agreement and all rights and remedies which such holders have been granted at
any time under any other agreement or contract and all of the rights which such
holders have under any law. Any Person having any rights under any provision of
this Agreement will be entitled to enforce such rights specifically, to recover
damages by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law.
7.3 PURCHASER'S INVESTMENT & OTHER REPRESENTATIONS The Purchaser
hereby represents and warrants as follows:
(i) INVESTMENT. The Purchaser is acquiring the Restricted Securities
purchased hereunder or acquired pursuant hereto for its own account for
investment and not with a view to, or for sale in connection with, any
public distribution thereof, nor with any present intention of distributing
or selling the same to the public; and the Purchaser is aware of the
restrictions and limitations affecting its right and ability to sell or
transfer such securities; provided that nothing contained herein will
prevent the Purchaser and subsequent holders of Restricted Securities from
transferring such securities in compliance with the provisions of Section 4
hereof.
(ii) AUTHORITY. The Purchaser has full power and authority to enter
into and to perform this Agreement in accordance with its terms. The
Purchaser has not been organized, reorganized or recapitalized specifically
for the purpose of investing in the Company.
(iii) ACCREDITED INVESTOR. The Purchaser is an Accredited Investor
within the definition set forth in Securities Act Rule 501(a).
(iv) RESTRICTIVE LEGEND. The Warrant Certificate will be imprinted
with a legend in substantially the following form:
"THE WARRANT EVIDENCED OR CONSTITUTED HEREBY, AND ALL SHARES OF
COMMON STOCK ISSUABLE HEREUNDER, HAVE BEEN AND WILL BE ISSUED
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("THE ACT") AND MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED,
PLEDGED OR HYPOTHECATED WITHOUT REGISTRATION UNDER THE ACT UNLESS
EITHER (I) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN
FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE
EFFECT THAT REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH
DISPOSITION OR (II) THE SALE OF SUCH SECURITIES IS MADE PURSUANT
TO SECURITIES AND EXCHANGE COMMISSION RULE 144."
18
(v) ORGANIZATION AND CORPORATE POWER. The Purchaser is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware. The Purchaser has all requisite corporate power and authority to
carry out the transactions contemplated by this Agreement.
(vi) AUTHORIZATION; NO BREACH. The execution, delivery and performance
of this Agreement and all other agreements and the transactions
contemplated hereby have been duly authorized by the Purchaser. This
Agreement and all other agreements contemplated hereby each constitutes a
valid and binding obligation of the Purchaser, enforceable in accordance
with its terms; except as enforcement thereof may be limited by any
applicable bankruptcy, reorganization, insolvency, moratorium, or similar
laws affecting rights of creditors generally. The execution and delivery by
the Purchaser of this Agreement and all other agreements contemplated
hereby and thereby and the fulfillment of and compliance with the
respective terms hereof and thereof by the Purchaser, do not and will not
(i) conflict with or result in a breach of the terms, conditions or
provisions of, (ii) result in a violation of, or (iii) require any
authorization, consent, approval, exemption or other action by or notice to
any court or administrative or governmental body pursuant to, the charter
or bylaws of the Purchaser, or any law, statute, rule or regulation to
which the Purchaser is subject, or any agreement, instrument, order,
judgment or decree to which the Purchaser is subject.
(vii) BROKERAGE. There are no claims for brokerage commissions,
finders' fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement
binding upon the Purchaser or Company or any Subsidiary; provided, however,
that this representation excludes any claim arising out of or due to any
action of the Company. The Purchaser will pay, and hold the Company
harmless against, any liability, loss or expense (including, without
limitation, reasonable attorneys' fees and out-of-pocket expenses) arising
in connection with any such claim.
(viii) GOVERNMENTAL CONSENT, ETC. No permit, consent, approval or
authorization of, or declaration to or filing with, any governmental
authority is required in connection with the execution, delivery and
performance by the Purchaser of this Agreement or the other agreements
contemplated hereby, or the consummation by the Purchaser of any other
transactions contemplated hereby or thereby.
7.4 RISK AND DUE DILIGENCE. Purchaser understands that the operation
of the Company's business is subject to numerous risks and that the Warrant and
Underlying Common Stock is a speculative investment that involves a high degree
of risk of loss of the entire investment therein. Purchaser is cognizant of and
understands such risks, including those set forth on Schedule 7.4 attached
hereto. Purchaser has been allowed, upon request, to examine any document or
agreement listed in the Schedules hereto, and has had the opportunity to obtain
any information concerning the Company, including the opportunity to ask
questions of and receive answers from authorized representatives of the Company
concerning this investment.
19
7.5 CONSENT TO AMENDMENTS. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended and the Company may take
any action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written consent of the
Purchaser. No other course of dealing between the Company and the holder of the
Warrant or Underlying Common Stock or any delay in exercising any rights
hereunder or under the Certificate of Incorporation will operate as a waiver of
any rights of any such holders.
7.6 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
issuance and delivery of the Warrant, regardless of any investigation made by or
on behalf of any party, but shall expire upon the earlier of (i) a fully
completed Public Offering by the Company or (ii) two years after the date of
Closing.
7.7 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto will bind and inure to the benefit of the
respective successors and assigns of the parties hereto whether so expressed or
not. This Agreement may be assigned by the Purchaser to any transferee of any
portion of the Warrant or any Underlying Common Stock. This Agreement may not be
assigned by the Company.
7.8 SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision will be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
this Agreement. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, void or unenforceable.
7.9 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more of the counterparts have been signed by
each party and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
7.10 DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
7.11 GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE UNITED
STATES OF AMERICA, IN EACH CASE LOCATED IN THE COUNTY OF NEW YORK,
20
FOR ANY ACTION, PROCEEDING OR INVESTIGATION IN ANY COURT OR BEFORE ANY
GOVERNMENTAL AUTHORITY ("LITIGATION") ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY (AND AGREES NOT TO COMMENCE
ANY LITIGATION RELATING THERETO EXCEPT IN SUCH COURTS), AND FURTHER AGREES THAT
SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY U.S. REGISTERED MAIL TO
ITS RESPECTIVE ADDRESS SET FORTH IN THIS AGREEMENT SHALL BE EFFECTIVE SERVICE OF
PROCESS FOR ANY LITIGATION BROUGHT AGAINST IT IN ANY SUCH COURT. EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION TO
THE LAYING OF VENUE OF ANY LITIGATION ARISING OUT OF THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY IN THE COURTS OF THE STATE OF NEW YORK OR THE
UNITED STATES OF AMERICA, IN EACH CASE LOCATED IN THE COUNTY OF NEW YORK, AND
HEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY SUCH COURT THAT ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE PARTIES IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
7.12 PUBLICITY. Each of the parties hereto agrees that it will make no
statement regarding the transactions contemplated hereby which is inconsistent
with any press release agreed to by the parties hereto. Notwithstanding the
foregoing, each of the parties hereto may, in documents required to be filed by
it with any regulatory body, make such statements with respect to the
transactions contemplated hereby as each may be advised is legally necessary
upon advice of its counsel.
7.13 NOTICES. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when delivered personally or
mailed by certified or registered mail, return receipt requested and postage
prepaid, to the recipient. Such notices, demands and other communications will
be sent
To the Company:
HealthGate Data Corp.
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Executive Officer
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
21
With a copy to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Rich, May, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone (▇▇▇) ▇▇▇-▇▇▇▇
Fax (▇▇▇) ▇▇▇-▇▇▇▇
To Purchaser:
GE Medical Systems
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
With a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
22
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first written above.
HEALTHGATE DATA CORP. GENERAL ELECTRIC COMPANY
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------- -------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Chairman and President GM, Global Business Development
23
Exhibit A
Form of Warrant
[Previously filed in Exhibit 10.30 to Form S-1 of the Registrant,
Registration No. 333-76899]
Exhibit B
Distribution Agreement
[Previously filed in Exhibit 10.27 to Form S-1 of the Registrant,
Registration No. 333-76899]
Exhibit C
Registration Agreement
[Previously filed in Exhibit 4.10 to Form S-1 of the Registrant,
Registration No. 333-76899]
Exhibit D
Form of Lock-up Agreement
June ___, 1999
▇▇ ▇▇▇▇▇ Securities Corporation
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
As representative of the
several Underwriters
Re: HealthGate Data Corp.
o Shares of Common Stock
Dear Sirs:
In order to induce ▇▇ ▇▇▇▇▇ Securities Corporation ("▇▇ ▇▇▇▇▇"),
Banc of America Securities LLC and ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC
(collectively, the "Underwriters") to enter into a certain underwriting
agreement with HealthGate Data Corp., a Delaware corporation (the "Company")
with respect to the public offering of shares of the Company's Common Stock, par
value $0.01 per share ("Common Stock"), the undersigned hereby agrees that for a
period of 180 days following the date of the final prospectus filed by the
Company with the Securities and Exchange Commission in connection with such
public offering, the undersigned will not, without the prior written consent of
▇▇ ▇▇▇▇▇, on behalf of the several Underwriters, (1) directly or indirectly,
offer, sell, assign, transfer, encumber, pledge, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase, lend, or otherwise dispose of, other
than by operation of law, any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock (including,
without limitation, Common Stock which may be deemed to be beneficially owned by
the undersigned in accordance with the rules and regulations promulgated under
the Securities Act of 1933, as the same may be amended or supplemented from time
to time (such shares, the "Beneficially Owned Shares")) or (2) enter into any
swap or other arrangement that transfers to another, in whole or in part, any of
the economic consequences of ownership of Common Stock whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise. The undersigned
shall, however, be entitled to (i) transfer the Company's Common Stock or
securities convertible into or exchangeable or exercisable for any Company's
Common Stock to an affiliate of the undersigned, provided however, that any such
transferee agrees to be bound by the terms of this letter and to enter into a
similar agreement with ▇▇ ▇▇▇▇▇ on its own behalf, and (ii) sell any Company
Common Stock purchased in the open market by the undersigned at or following
consummation of the initial public offering.
Anything contained herein to the contrary notwithstanding, any
person to whom shares of Common Stock or Beneficially Owned Shares are
transferred from the undersigned shall be bound by the terms of this Agreement.
The undersigned is executing and delivering this letter on the
express understanding that each director, each executive officer, each
individual and entity listed in the "Principal Stockholders" table in the
Company's Registration Statement on Form S-1 (Registration No. 333-76899) and
certain other holders of the Company's Common Stock representing in the
aggregate more than 93% of the Company's outstanding Common Stock (assuming
conversion of all outstanding preferred stock to common stock and including the
undersigned's stock) has executed and delivered to ▇▇ ▇▇▇▇▇ a letter
substantially similar to this letter. If such understanding is incorrect, this
letter shall immediately become null and void. If any holder of the Company's
Common Stock who has executed such a lock-up letter is released with respect to
some or all of such stockholder's shares of the Company's Common Stock to effect
a transfer in which the transferee will not be bound to the lock-up arrangements
of the transferor, ▇▇ ▇▇▇▇▇, upon written request
from the undersigned, will release in the aggregate the same number of the
undersigned's and its affiliates' shares from such lock-up provisions.
In addition, the undersigned hereby waives, from the date hereof
until the expiration of the 180 day period following the date of the Company's
final Prospectus, any and all rights, if any, to request or demand registration
pursuant to the Securities Act of any shares of Common Stock that are registered
in the name of the undersigned or that are Beneficially Owned Shares.
In order to enable the aforesaid covenants to be enforced, the
undersigned hereby consents to the placing of legends and/or stop-transfer
orders with the transfer agent of the Common Stock with respect to any shares of
Common Stock or Beneficially Owned Shares.
Whether or not the public offering actually occurs depends on a
number of factors, including market conditions. Any public offering will only be
made pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
This agreement shall terminate and be of no further force and effect
if the closing of the offering has not occurred by March 31, 2000.
This letter shall be governed by and construed in accordance with
the laws of the State of New York, without regard to principles of conflict of
laws.
General Electric Company
By: __________________________
Name: ________________________
Title: _______________________
____________________________
____________________________
____________________________
(Address)
June ___, 1999
▇▇ ▇▇▇▇▇ Securities Corporation
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
As representative of the
several Underwriters
Re: HealthGate Data Corp.
o Shares of Common Stock
Dear Sirs:
This is to confirm that prior to our execution and delivery of a lock-up
agreement addressed to you dated June __, 1999, HealthGate Data Corp., a
Delaware corporation (the "Company"), has informed us that in connection with a
lock-up agreement between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇ ▇▇▇▇▇ Securities Corporation,
as a representative of the several underwriters ("▇▇ ▇▇▇▇▇"), ▇▇. ▇▇▇▇▇▇ will be
permitted to transfer up to 20,000 shares of the Company's Common Stock as bona
fide gifts to individuals or entities, and, such transferee(s) shall not be
bound by the terms of this letter, without violating the term of his lock-up
agreement with ▇▇ ▇▇▇▇▇.
This letter is to confirm that the exemption of ▇▇. ▇▇▇▇▇▇'▇ 20,000 shares
of Company Common Stock as described above shall be deemed not to constitute a
release of ▇▇. ▇▇▇▇▇▇'▇ shares as described in the final sentence of the third
paragraph of our lock-up agreement with you. Accordingly, ▇▇. ▇▇▇▇▇▇'▇ transfer
of up to 20,000 shares of Company Common Stock, as described above, will not
require the release of an equal number of shares from the lock-up provision in
our lock-up agreement with you.
General Electric Company
By: __________________________
Name: ________________________
Title: _______________________
Exhibit E
June 17, 1999
General Electric Company
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
GE Medical Systems
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: HealthGate Data Corp.
Ladies and Gentlemen:
We have acted as counsel to HealthGate Data Corp., a Delaware corporation
(the "Company"), in connection with (i) the Development and Distribution
Agreement, dated as of June 11, 1999 (the "Distribution Agreement"), by and
between the Company and GE Medical Systems ("GEMS"), a division of General
Electric Company, a New York corporation ("GE"), and (ii) a Warrant Purchase
Agreement, dated as of June 11, 1999 (the "Warrant Purchase Agreement"), by and
between the Company and GE providing for, inter alia, the issuance of a Warrant
(the "Warrant") to GE for up to 300,000 shares of the Company's common stock
(the "Warrant Shares"). This opinion is being furnished to you pursuant to
Section 2.2(i) of the Warrant Purchase Agreement. Terms used herein without
definition shall have the meanings ascribed to them in the Warrant Purchase
Agreement.
We have examined the originals or certified, conformed or reproduction
copies of all such records, agreements, instruments and documents as we have
deemed relevant or necessary as the basis for the opinions hereinafter
expressed. In all such examinations, we have assumed the genuineness of all
signatures on original or certified copies and the conformity to original or
certified copies of all copies submitted to us as conformed or reproduction
copies. As to various questions of fact relevant to our opinion, we have relied
upon statements or certificates of public officials, officers or representatives
of the Company and others.
General Electric Company
GE Medical Systems
June 17, 1999
Page 2
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and has full
corporate power and authority to conduct its business as presently
conducted, to enter into and perform the Distribution Agreement, the
Warrant Purchase Agreement, the Warrant and the Registration
Agreement, and to carry out the transactions contemplated thereby.
The Company is duly qualified to do business and is in good standing
in the Commonwealth of Massachusetts, the only United States
jurisdiction in which, to our knowledge, the Company currently owns
property or conducts its business.
2. The authorized capital stock of the Company consists of 20,000,000
shares of Common Stock, par value $.01 (the "Common Stock"), of
which 1,151,895 shares are issued and outstanding, and 834,629
shares of Preferred Stock, par value $.01 (the "Preferred Stock"),
1,000 shares of which are designated "Series A Convertible Preferred
Stock," all of which are issued and outstanding, 1,000 shares of
which are designated "Series B Convertible Stock," all of which are
issued and outstanding, 1,000 shares of which are designated "Series
C Convertible Preferred Stock," all of which are issued and
outstanding, 1,667 of which are designated "Series D Convertible
Preferred Stock," all of which are issued and outstanding, and
829,962 of which are designated "Series E Redeemable Convertible
Preferred Stock," 720,757 of which are issued and outstanding. There
are no authorized classes of capital stock of the Company other than
those set forth in this paragraph. All of the issued and outstanding
shares of capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable. Except as
contemplated by the Warrant Purchase Agreement or the Company's
Amended and Restated Certificate of Incorporation, as amended, and
except as set forth on Schedule 5.2 to the Warrant Purchase
Agreement, to our knowledge, (i) no ------------ subscription,
warrant, option, convertible security or other right (contingent or
otherwise) to purchase or acquire any shares of capital stock of the
Company is authorized or outstanding, (ii) there is not any
commitment of the Company to issue any subscription, warrant,
option, convertible security or other such right or to issue or
distribute to holders of any shares of the Company's capital stock
any evidences of indebtedness or assets of the Company, and (iii)
the Company has no obligation (contingent or otherwise) to purchase,
redeem or otherwise acquire any shares of its capital stock or any
interest therein or to pay any dividend or make any other
distribution in respect thereof.
General Electric Company
GE Medical Systems
June 17, 1999
Page 3
3. The issuance and delivery of the Warrant by the Company in
accordance with the Warrant Purchase Agreement has been duly
authorized by all necessary corporate action on the part of the
Company, and the Warrant Shares of common stock issuable thereunder
when so issued, sold and delivered against payment therefor in
accordance with the provisions of the Warrant will be duly and
validly issued, fully paid and non-assessable.
4. The execution, delivery and performance by the Company of the
Distribution Agreement, the Warrant Purchase Agreement, the
Registration Agreement, the Agreement Concerning Stockholders
Agreement have been duly authorized by all necessary corporate
action, and each such agreement has been duly executed and delivered
by the Company. Each such agreement constitutes the valid and
binding obligation of the Company, and is enforceable against the
Company.
5. The execution, delivery and performance of the Distribution
Agreement, the Warrant Purchase Agreement and the Registration
Agreement, and the offer, issuance and sale of the common stock
under the Warrant, will not conflict with, or result in any breach
of any of the terms, conditions, or provisions of, or constitute a
default under, the Amended and Restated Certificate of Incorporation
or Bylaws of the Company, each as amended to date, or any material
indenture, lease, agreement or other instrument known to us to which
the Company is a party or by which it or any of its properties are
bound or any decree, judgment or order specifically naming the
Company and known to us.
6. Except as obtained and in effect at the Closing, no consent,
approval, order or authorization of, or registration, qualification,
designation, declaration or filing with any governmental authority
is required on the part of the Company in connection with the
execution and delivery of the Distribution Agreement, the Warrant
Purchase Agreement, the Warrant or the offer, issuance, sale and
delivery of the Warrant Shares, or the other transactions to be
consummated at the Closing pursuant to the Warrant Purchase
Agreement.
7. The offer and issuance of the Warrant and the Warrant Shares
pursuant to the Warrant Purchase Agreement are exempt, and the
issuance of Common Stock upon exercise of the Warrant will be
exempt, from registration under the Securities Act of 1933, as
amended.
General Electric Company
GE Medical Systems
June 17, 1999
Page 4
We express no opinion as to compliance with applicable anti-fraud
provisions of federal securities laws. We express no opinion as to compliance
with applicable state securities laws.
The opinions expressed herein are subject to the effect of generally
applicable rules of law that: (a) limit or affect the enforcement of provisions
of any contract that purport to require a waiver of the obligations of good
faith and fair dealing; (b) provide that forum selection clauses are not
necessarily binding on the courts in the forum selected; (c) limit the
enforceability of waivers of the right to trial by jury or rights to notice or
other rights or benefits conferred by operation of law; (d) limit the
availability of a remedy where another remedy has been elected or limit waivers
of remedies or defenses; (e) limit the enforceability of provisions releasing,
exculpating or exempting a party from, or requiring indemnification of a party
for, liability for its own action or inaction or on public policy grounds; (f)
where less than all of a contract may be unenforceable, limit the enforceability
of the balance of such contract to circumstances in which the unenforceable
portion is not an essential part of the agreed upon exchange under such
contract; and (g) govern and afford judicial discretion regarding the
entitlement to attorneys' fees and other costs.
The opinions on enforceability expressed herein are subject further to the
effect of applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws affecting the rights of creditors and
secured parties generally, and by general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law), as well
as possible limitations upon the exercise of remedial or procedural provisions
contained in the Distribution Agreement, the Warrant Purchase Agreement, the
Agreement Concerning Stockholders Agreement or the Registration Agreement,
provided, that such limitations do not, in our opinion, subject to the other
qualifications contained in this opinion letter, make the remedies and
procedures that will be afforded to GEMS or GE inadequate for the practical
realization of the principal benefits purported to be provided to GEMS or GE by
the Distribution Agreement, the Warrant Purchase Agreement, the Agreement
Concerning Stockholders Agreement and the Registration Agreement (subject to the
effect of any judicial or other delays in the availability of such remedies).
Notwithstanding the foregoing, however, we express no opinion as to the
enforceability of Section 6 of the Registration Agreement.
Whenever our opinion with respect to the existence or absence of facts is
indicated to be based on our knowledge or awareness, we are referring to the
actual knowledge or awareness of Rich, May, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C. attorneys
who have given substantive attention to such matters during the course of such
representation, which knowledge or awareness has been obtained by such attorneys
in their capacity as such and is intended to signify that in the course of such
representation, no information has come to their attention which has given them
actual knowledge or awareness of the existence or absence of such facts, and
that we have undertaken
General Electric Company
GE Medical Systems
June 17, 1999
Page 5
no independent investigation either within our firm, with our clients, or with
any other person to determine the existence or absence of such facts.
We are members of the bar of the Commonwealth of Massachusetts and do not
hold ourselves out as competent to opine as to matters of law governed by other
states. Accordingly, our opinions are limited to the laws of the Commonwealth of
Massachusetts, the General Corporation Law of the State of Delaware, and the
laws of the federal government of the United States. To the extent that any of
the laws of New York or other laws govern any of the matters as to which we
express an opinion herein, we have assumed, with your permission, that the law
of such jurisdiction is, in all material respects, the same as that of the law
of the Commonwealth of Massachusetts.
This opinion is rendered only to the addressees and is solely for their
benefit in connection with the transactions contemplated by the Warrant Purchase
Agreement, and may not be relied upon by any other person for any purpose
without the prior written consent of the undersigned.
Very truly yours,
RICH, MAY, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.
Exhibit F to Warrant Stock Purchase Agreement
HealthGate Data Corp.
GE Medical Systems Warrant
Calculations of Shares and Percentage
Common Stock 1,151,895 (Includes 6,345 exercised options)
Series A 304,868
Series B 399,400
Series C 138,642
Series D 335,097
Series E 720,757
Subtotal 3,050,659
Options 519,868 (464,268-Plan; 55,600 Non Plan)
Petra Warrant 114,950
▇▇▇▇ ▇▇▇▇▇▇▇▇ Warrant 5,460
Option and Warrant
Subtotal 640,278
Available Options 179,387 (650,000-464,268-6,345)
Subtotal 3,870,324
Post-Closing
Percentage
GEMS Warrant 300,000 7.19%
Total Post-Closing
Shares Fully Diluted 4,170,324
Schedule 5.2
to
Warrant Purchase Agreement
Capitalization of HealthGate
Attached hereto is HealthGate Data Corp.'s 3-page Capitalization Table (as
of May 14, 1999) which includes a listing of outstanding options, rights and
warrants to purchase shares of capital stock of the Company.
HealthGate Data Corp.
Capitalization Table (as of May 14, 1999)
SERIES A STOCK SERIES B STOCK
COMMON
STOCK
Series A Series B
Converted Converted
Stockholder Series A As shares Series B As Shares
Number Name Stock Converted(1) Rounded Stock Converted(2) Rounded
====================================================================================================================================
1 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 15 4,573.17 4,573
2 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
Account Management Corporation
3 Profit Sharing Plan 50 15,243.90 15,243
4 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 0.00
5 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 0.00
6 ▇▇▇▇▇▇▇▇▇ Science, Ltd. 0.00
7 ▇▇▇▇▇▇▇▇▇ Wissenschafts-Verlag GmbH 0.00
8 ▇▇▇▇▇, ▇▇▇▇ ▇., M.D. 2,550 250 76,219.51 76,219
9 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
10 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 70 0.00
11 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
12 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
13 ▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
14 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇. 0.00
15 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
16 Cabanas, Lazare 0.00
17 Capotoste, ▇▇▇▇▇▇▇▇▇▇▇ 0.00
18 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
19 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
20 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 6,650 0.00
21 ▇▇▇▇▇, ▇▇▇▇-▇▇▇▇ 0.00
22 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
23 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
24 ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
25 ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 8,550 0.00
26 ▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
27 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 20 6,097.56 6,097
28 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 5 1,524.39 1,524
29 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 50 15,243.90 15,243
30 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
31 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 0.00
32 ▇▇▇▇, ▇▇▇▇ ▇.
33 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 0.00
▇▇▇▇, ▇▇▇▇▇▇▇ ▇., Trustee of the 1995
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Revocable Trust under
34 Declaration of Trust dated March 29, 1995 0.00
▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇., Trustees
of the ▇▇▇▇▇▇▇ ▇. & ▇▇▇▇▇▇▇ ▇▇▇▇
Grandchildrens Trust under Declaration of
35 Trust dated June 29, 1994 0.00
Egan, Richard, Trustee of the 1986
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Trust under Declaration
36 of Trust dated May 27, 1986 0.00
37 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
38 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 0.00
39 ▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
40 ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
41 ▇▇▇▇▇▇, ▇▇▇▇▇ 54,200 150 45,731.71 45,731
42 G.E. Capital Equity Investments, Inc.
43 ▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
44 ▇▇▇▇▇▇, ▇▇▇▇ 0.00
45 ▇▇▇▇▇▇▇, Hardy 0.00
46 ▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
47 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 0.00
48 ▇▇▇▇▇▇, ▇▇▇▇ 5,000 0.00
49 ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 0.00
50 Kegels, ▇▇▇▇▇ 0.00
51 ▇▇▇▇▇▇, ▇▇▇▇ 0.00
52 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 16,000 0.00
54 Kudsi, Bashar 0.00
====================================================================================================================================
SERIES C STOCK SERIES D STOCK
Series C Series D
Converted Converted
Stockholder Series C As Shares Series D As Shares
Number Name Stock Converted(3) Rounded Stock Converted(4) Rounded
==========================================================================================================================
1 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ -
2 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
Account Management Corporation
3 Profit Sharing Plan -
4 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ -
5 ▇▇▇▇▇▇▇▇▇, ▇▇▇ -
6 ▇▇▇▇▇▇▇▇▇ Science, Ltd. - 1,333 267,957.652 267,957
7 ▇▇▇▇▇▇▇▇▇ Wissenschafts-Verlag GmbH - 334 67,140.177 67,140
8 ▇▇▇▇▇, ▇▇▇▇ ▇., M.D. -
9 ▇▇▇▇▇, ▇▇▇▇▇▇▇ -
10 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. -
11 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ -
12 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
13 ▇▇▇▇▇, ▇▇▇▇▇▇ -
14 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇. 20 2,773.0021 2,773
15 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ -
16 Cabanas, Lazare -
17 Capotoste, ▇▇▇▇▇▇▇▇▇▇▇ -
18 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
19 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ -
20 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. -
21 ▇▇▇▇▇, ▇▇▇▇-▇▇▇▇ -
22 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. -
23 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
24 ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ -
25 ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ -
26 ▇▇▇▇▇▇▇, ▇▇▇▇ -
27 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ -
28 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
29 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 35 4,852.7536 4,852
30 ▇▇▇▇▇▇, ▇▇▇▇▇▇ -
31 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 50 6,932.5051 6,932
32 ▇▇▇▇, ▇▇▇▇ ▇.
33 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 25 3,466.2526 3,466
▇▇▇▇, ▇▇▇▇▇▇▇ ▇., Trustee of the 1995
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Revocable Trust under
34 Declaration of Trust dated March 29, 1995 25 3,466.2526 3,466
▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇., Trustees
of the ▇▇▇▇▇▇▇ ▇. & ▇▇▇▇▇▇▇ ▇▇▇▇
Grandchildrens Trust under Declaration of
35 Trust dated June 29, 1994 25 3,466.2526 3,466
Egan, Richard, Trustee of the 1986
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Trust under Declaration
36 of Trust dated May 27, 1986 25 3,466.2526 3,466
37 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 20 2,773.0021 2,773
38 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 20 2,773.0021 2,773
39 ▇▇▇▇, ▇▇▇▇▇▇ ▇. 50 6,932.5051 6,932
40 ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
41 ▇▇▇▇▇▇, ▇▇▇▇▇ -
42 G.E. Capital Equity Investments, Inc.
43 ▇▇▇▇▇, ▇▇▇▇▇▇ 20 2,773.0021 2,773
44 ▇▇▇▇▇▇, ▇▇▇▇ -
45 ▇▇▇▇▇▇▇, Hardy -
46 ▇▇▇▇, ▇▇▇▇▇▇▇ -
47 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. -
48 ▇▇▇▇▇▇, ▇▇▇▇ -
49 ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ -
50 Kegels, ▇▇▇▇▇ -
51 ▇▇▇▇▇▇, ▇▇▇▇ -
52 ▇▇▇▇▇, ▇▇▇▇▇▇▇ -
54 Kudsi, Bashar -
==========================================================================================================================
SERIES E STOCK
Total
Shares
Outstanding Percentage Common Common
Stockholder Series E As as of Total Stock Stock
Number Name Stock Converted(6) Converted Outstanding Warrants Options
==========================================================================================================================
1 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 4,573 0.15%
2 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00% 1,000
Account Management Corporation
3 Profit Sharing Plan 15,243 0.50%
4 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ - 0.00% 2,000
5 ▇▇▇▇▇▇▇▇▇, ▇▇▇ - 0.00% 500
6 ▇▇▇▇▇▇▇▇▇ Science, Ltd. 174,729 174,729 442,686 14.51% 10,000
7 ▇▇▇▇▇▇▇▇▇ Wissenschafts-Verlag GmbH 67,140 2.20%
8 ▇▇▇▇▇, ▇▇▇▇ ▇., M.D. 78,769 2.58% 10,000
9 ▇▇▇▇▇, ▇▇▇▇▇▇▇ - 0.00% 1,500
10 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 70 0.00% 4,080
11 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ - 0.00% 500
12 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00% 1,500
13 ▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00% 500
14 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇. 2,773 0.09%
15 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ - 0.00% 1,000
16 Cabanas, Lazare - 0.00% 2,000
17 Capotoste, ▇▇▇▇▇▇▇▇▇▇▇ - 0.00% 1,500
18 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00% 5,000
19 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ - 0.00% 2,500
20 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 6,650 0.22%
21 ▇▇▇▇▇, ▇▇▇▇-▇▇▇▇ - 0.00% 500
22 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. - 0.00% 6,000
23 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00% 1,000
24 ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ - 0.00% 5,460
25 ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 8,550 0.28% 26,000
26 ▇▇▇▇▇▇▇, ▇▇▇▇ - 0.00% 1,000
27 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 6,097 0.20%
28 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 1,524 0.05%
29 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 20,095 0.66%
30 ▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00% 1,000
31 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 6,932 0.23%
32 ▇▇▇▇, ▇▇▇▇ ▇. - 0.00% 5,000
33 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 3,466 0.11%
▇▇▇▇, ▇▇▇▇▇▇▇ ▇., Trustee of the 1995
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Revocable Trust under
34 Declaration of Trust dated March 29, 1995 3,466 0.11%
▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇., Trustees
of the ▇▇▇▇▇▇▇ ▇. & ▇▇▇▇▇▇▇ ▇▇▇▇
Grandchildrens Trust under Declaration of
35 Trust dated June 29, 1994 3,466 0.11%
Egan, Richard, Trustee of the 1986
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Trust under Declaration
36 of Trust dated May 27, 1986 3,466 0.11%
37 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 2,773 0.09%
38 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 2,773 0.09%
39 ▇▇▇▇, ▇▇▇▇▇▇ ▇. 6,932 0.23%
40 ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00% 2,500
41 ▇▇▇▇▇▇, ▇▇▇▇▇ 99,931 3.28% 10,000
42 G.E. Capital Equity Investments, Inc. 546,028 546,028 546,028 17.90%
43 ▇▇▇▇▇, ▇▇▇▇▇▇ 2,773 0.09%
44 ▇▇▇▇▇▇, ▇▇▇▇ - 0.00% 20,000
45 ▇▇▇▇▇▇▇, Hardy - 0.00% 2,000
46 ▇▇▇▇, ▇▇▇▇▇▇▇ - 0.00% 2,500
47 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. - 0.00% 10,000
48 ▇▇▇▇▇▇, ▇▇▇▇ 5,000 0.16% 56,250
49 ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ - 0.00% ▇▇▇
▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00% 500
51 ▇▇▇▇▇▇, ▇▇▇▇ - 0.00% 2,500
52 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 16,000 0.52%
▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00% 1,000
==========================================================================================================================
Stock Stock
Options Options
Outstanding Exercised
Stockholder under the under the F/D
Number Name 1994 Plan 1994 Plan Total(7) F/D %(7)
==================================================================================================
1 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 4,573 0.12%
2 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 1,000 1,000 0.03%
Account Management Corporation
3 Profit Sharing Plan 15,243 0.41%
4 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 2,000 2,000 0.05%
5 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 500 500 0.01%
6 ▇▇▇▇▇▇▇▇▇ Science, Ltd. 10,000 452,686 12.26%
7 ▇▇▇▇▇▇▇▇▇ Wissenschafts-Verlag GmbH 67,140 1.82%
8 ▇▇▇▇▇, ▇▇▇▇ ▇., M.D. 10,000 88,769 2.41%
9 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 1,500 1,500 0.04%
10 ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 4,080 70 4,150 0.11%
11 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 500 500 0.01%
12 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 1,500 1,500 0.04%
13 ▇▇▇▇▇, ▇▇▇▇▇▇ 500 500 0.01%
14 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇ ▇. 2,773 0.08%
15 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 1,000 1,000 0.03%
16 Cabanas, Lazare 2,000 2,000 0.05%
17 Capotoste, ▇▇▇▇▇▇▇▇▇▇▇ 1,500 1,500 0.04%
18 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 5,000 5,000 0.14%
19 ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 2,500 2,500 0.07%
20 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 6,650 0.18%
21 ▇▇▇▇▇, ▇▇▇▇-▇▇▇▇ 500 500 0.01%
22 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 6,000 0.16%
23 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 1,000 1,000 0.03%
24 ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 5,460 0.15%
25 ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 20,000 34,550 0.94%
26 ▇▇▇▇▇▇▇, ▇▇▇▇ 1,000 1,000 0.03%
27 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 6,097 0.17%
28 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 1,524 0.04%
29 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 20,095 0.54%
30 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 1,000 1,000 0.03%
31 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 6,932 0.19%
32 ▇▇▇▇, ▇▇▇▇ ▇. 5,000 5,000 0.14%
33 ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ 3,466 0.09%
▇▇▇▇, ▇▇▇▇▇▇▇ ▇., Trustee of the 1995
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Revocable Trust under
34 Declaration of Trust dated March 29, 1995 3,466 0.09%
▇▇▇▇, ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇., Trustees
of the ▇▇▇▇▇▇▇ ▇. & ▇▇▇▇▇▇▇ ▇▇▇▇
Grandchildrens Trust under Declaration of
35 Trust dated June 29, 1994 3,466 0.09%
Egan, Richard, Trustee of the 1986
▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Trust under Declaration
36 of Trust dated May 27, 1986 3,466 0.09%
37 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 2,773 0.08%
38 ▇▇▇▇▇▇▇▇▇, ▇▇▇ 2,773 0.08%
39 ▇▇▇▇, ▇▇▇▇▇▇ ▇. 6,932 0.19%
40 ▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,500 2,500 0.07%
41 ▇▇▇▇▇▇, ▇▇▇▇▇ 10,000 109,931 2.98%
42 G.E. Capital Equity Investments, Inc. 546,028 14.79%
43 ▇▇▇▇▇, ▇▇▇▇▇▇ 2,773 0.08%
44 ▇▇▇▇▇▇, ▇▇▇▇ 20,000 20,000 0.54%
45 ▇▇▇▇▇▇▇, Hardy 2,000 2,000 0.05%
46 ▇▇▇▇, ▇▇▇▇▇▇▇ 2,500 2,500 0.07%
47 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 10,000 10,000 0.27%
48 ▇▇▇▇▇▇, ▇▇▇▇ 56,250 5,000 61,250 1.66%
49 ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 500 500 0.01%
50 Kegels, ▇▇▇▇▇ 500 500 0.01%
51 ▇▇▇▇▇▇, ▇▇▇▇ 2,500 2,500 0.07%
52 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 16,000 0.43%
▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ 1,000 1,000 0.03%
==================================================================================================
HealthGate Data Corp.
Capitalization Table (as of May 14, 1999)
SERIES A STOCK SERIES B STOCK
COMMON
STOCK
Series A Series B
Converted Converted
Stockholder Series A As Shares Series B As Shares
Number Name Stock Converted(1) Rounded Stock Converted(2) Rounded
====================================================================================================================================
55 ▇▇▇▇▇▇, ▇▇▇▇ ▇. 1,275 0.00
56 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 200,000 0.00
57 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
58 ▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
59 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
60 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 225,000 0.00
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
61 ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.00
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
62 ▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.00
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/91 l/b/o
63 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and his children 25,000 0.00
64 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 60 18,292.68 18,292
65 ▇▇▇▇▇▇, ▇▇▇ 0.00
66 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 0.00
67 ▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
68 ▇▇▇▇▇▇, ▇▇▇▇ ▇.
69 ▇▇▇▇▇▇, ▇▇▇ ▇. 0.00
70 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
71 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 0.00
72 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 54,200 150 45,731.71 45,731
73 ▇▇▇▇▇▇▇ Research Corporation 3,400 0.00 1,000 399,400.8987 399,400
74 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
75 ▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
76 ▇▇▇▇, ▇▇▇▇▇ 0.00
77 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 100 30,487.80 30,487
78 Petra Capital LLC(5) 0.00
79 Pignature, ▇▇▇▇ 0.00
80 ▇▇▇▇▇, ▇▇▇▇▇ 0.00
81 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.▇. and ▇▇▇▇ ▇▇▇▇ 5,000 0.00
82 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 495,000 0.00
83 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
84 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 0.00
85 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 0.00
86 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
87 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
88 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
89 ▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
90 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
91 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇. 5 1,524.39 1,524
92 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 35 10,670.73 10,670
93 ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. 5 1,524.39 1,524
94 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 5 1,524.39 1,524
95 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
96 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
97 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 0.00
98 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 0.00
99 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 0.00
100 ▇▇▇▇▇▇▇▇, ▇▇▇ 0.00
101 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 0.00
102 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 50 15,243.90 15,243
103 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇ 50 15,243.90 15,243
104 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 0.00
====================================================================================================================================
Totals 1,151,895 1,000 304,878.05 304,868 1,000 399,400.8987 399,400
SERIES C STOCK SERIES D STOCK
Series C Series D
Converted Converted
Stockholder Series C As Shares Series D As Shares
Number Name Stock Converted(3) Rounded Stock Converted(4) Rounded
==========================================================================================================================
55 ▇▇▇▇▇▇, ▇▇▇▇ ▇. -
56 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. -
57 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. -
58 ▇▇▇▇▇▇▇, ▇▇▇▇ -
59 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. -
60 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. -
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
61 ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children -
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
62 ▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children -
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/91 l/b/o
63 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and his children -
64 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 50 6,932.5051 6,932
65 ▇▇▇▇▇▇, ▇▇▇ -
66 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ -
67 ▇▇▇▇▇▇▇, ▇▇▇▇ -
68 ▇▇▇▇▇▇, ▇▇▇▇ ▇.
69 ▇▇▇▇▇▇, ▇▇▇ ▇. 15 2,079.7515 2,079
70 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 20 2,773.0021 2,773
71 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ -
72 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. -
73 ▇▇▇▇▇▇▇ Research Corporation 425 58,926.2936 58,926
74 ▇▇▇▇▇▇, ▇▇▇▇▇▇ -
75 ▇▇▇▇▇▇, ▇▇▇▇▇ -
76 ▇▇▇▇, ▇▇▇▇▇ -
77 ▇▇▇▇▇▇, ▇▇▇▇▇▇ -
78 Petra Capital LLC(5) -
79 Pignature, ▇▇▇▇ -
80 ▇▇▇▇▇, ▇▇▇▇▇ -
81 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.▇. and ▇▇▇▇ ▇▇▇▇ -
82 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. -
83 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. -
84 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 10 1,386.5010 1,386
85 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 10 1,386.5010 1,386
86 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
87 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
88 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
89 ▇▇▇▇▇▇▇, ▇▇▇▇▇ -
90 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
91 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇. -
92 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 35 4,852.7536 4,852
93 ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. -
94 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ -
95 ▇▇▇▇▇, ▇▇▇▇▇▇▇ -
96 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ -
97 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ -
98 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 20 2,773.0021 2,773
99 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 15 2,079.7515 2,079
100 ▇▇▇▇▇▇▇▇, ▇▇▇ -
101 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 50 6,932.5051 6,932
102 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. -
103 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇ 35 4,852.7536 4,852
104 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ -
==========================================================================================================================
Totals 1,000 138,650.1026 138,642 1,667 335,097.8290 335,097
SERIES E STOCK
Total
Shares
Outstanding Percentage Common
Stockholder Series E As as of Total Stock
Number Name Stock Converted(6) Converted Outstanding Warrants
==================================================================================================================
55 ▇▇▇▇▇▇, ▇▇▇▇ ▇. 1,275 0.04%
56 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 200,000 6.56%
57 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. - 0.00%
58 ▇▇▇▇▇▇▇, ▇▇▇▇ - 0.00%
59 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. - 0.00%
60 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 225,000 7.38%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
61 ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.82%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
62 ▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.82%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/91 l/b/o
63 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and his children 25,000 0.82%
64 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 25,224 0.83%
65 ▇▇▇▇▇▇, ▇▇▇ - 0.00%
66 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ - 0.00%
67 ▇▇▇▇▇▇▇, ▇▇▇▇ - 0.00%
68 ▇▇▇▇▇▇, ▇▇▇▇ ▇. - 0.00%
69 ▇▇▇▇▇▇, ▇▇▇ ▇. 2,079 0.07%
70 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 2,773 0.09%
71 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ - 0.00%
72 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 99,931 3.28%
73 ▇▇▇▇▇▇▇ Research Corporation 461,726 15.14%
74 ▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00%
75 ▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
76 ▇▇▇▇, ▇▇▇▇▇ - 0.00%
77 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 30,487 1.00%
78 Petra Capital LLC(5) - 0.00% 114,950
79 Pignature, ▇▇▇▇ - 0.00%
80 ▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
81 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.▇. and ▇▇▇▇ ▇▇▇▇ 5,000 0.16%
82 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 495,000 16.23%
83 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. - 0.00%
84 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 1,386 0.05%
85 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 1,386 0.05%
86 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00%
87 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
88 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
89 ▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
90 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00%
91 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇. 1,524 0.05%
92 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 15,522 0.51%
93 ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. 1,524 0.05%
94 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 1,524 0.05%
95 ▇▇▇▇▇, ▇▇▇▇▇▇▇ - 0.00%
96 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ - 0.00%
97 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ - 0.00%
98 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,773 0.09%
99 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 2,079 0.07%
100 ▇▇▇▇▇▇▇▇, ▇▇▇ - 0.00%
101 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 6,932 0.23%
102 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 15,243 0.50%
103 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇ 20,095 0.66%
104 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ - 0.00%
==================================================================================================================
Totals 720,757 720,757 3,050,659 100.00% 120,410
Stock Stock
Options Options
Common Outstanding Exercised
Stockholder Stock under the under the F/D
Number Name Options 1994 Plan 1994 Plan Total(7) F/D %(7)
===========================================================================================================
55 ▇▇▇▇▇▇, ▇▇▇▇ ▇. 1,275 1,275 0.03%
56 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 30,000 30,000 230,000 6.23%
57 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 6,000 6,000 0.16%
58 ▇▇▇▇▇▇▇, ▇▇▇▇ 2,500 2,500 2,500 0.07%
59 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 6,000 6,000 0.16%
60 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 5,600 230,600 6.25%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
61 ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.68%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/90 l/b/o
62 ▇▇▇▇ ▇. ▇▇▇▇▇▇ and her children 25,000 0.68%
▇▇▇▇▇▇, ▇▇▇▇▇ ▇., Trustee u/a 7/5/91 l/b/o
63 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and his children 25,000 0.68%
64 ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 25,224 0.68%
65 ▇▇▇▇▇▇, ▇▇▇ 3,000 3,000 3,000 0.08%
66 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ 2,500 2,500 2,500 0.07%
67 ▇▇▇▇▇▇▇, ▇▇▇▇ 500 500 500 0.01%
68 ▇▇▇▇▇▇, ▇▇▇▇ ▇. 51,188 51,188 51,188 1.39%
69 ▇▇▇▇▇▇, ▇▇▇ ▇. 2,079 0.06%
70 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 2,773 0.08%
71 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 500 500 500 0.01%
72 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 99,931 2.71%
73 ▇▇▇▇▇▇▇ Research Corporation 461,726 12.51%
74 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,000 2,000 2,000 0.05%
75 ▇▇▇▇▇▇, ▇▇▇▇▇ 1,500 1,500 1,500 0.04%
76 ▇▇▇▇, ▇▇▇▇▇ 2,500 2,500 2,500 0.07%
77 ▇▇▇▇▇▇, ▇▇▇▇▇▇ 30,487 0.83%
78 Petra Capital LLC(5) 114,950 3.11%
79 Pignature, ▇▇▇▇ 2,500 2,500 2,500 0.07%
80 ▇▇▇▇▇, ▇▇▇▇▇ 1,000 1,000 1,000 0.03%
81 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.▇. and ▇▇▇▇ ▇▇▇▇ 5,000 0.14%
82 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 75,000 75,000 570,000 15.44%
83 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 14,000 14,000 0.38%
84 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 1,386 0.04%
85 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 1,386 0.04%
86 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 6,000 6,000 0.16%
87 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 6,000 6,000 0.16%
88 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 2,500 2,500 2,500 0.07%
89 ▇▇▇▇▇▇▇, ▇▇▇▇▇ 55,000 55,000 55,000 1.49%
90 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 3,750 3,750 3,750 0.10%
91 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇. 1,524 0.04%
92 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. 15,522 0.42%
93 ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. 1,524 0.04%
94 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 1,524 0.04%
95 ▇▇▇▇▇, ▇▇▇▇▇▇▇ 2,500 2,500 2,500 0.07%
96 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 1,000 1,000 1,000 0.03%
97 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 41,000 41,000 41,000 1.11%
98 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,773 0.08%
99 ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. 2,079 0.06%
100 ▇▇▇▇▇▇▇▇, ▇▇▇ 2,500 2,500 2,500 0.07%
101 ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 6,932 0.19%
102 ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. 15,243 0.41%
103 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇ 20,095 0.54%
104 ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 1,500 1,500 1,500 0.04%
===========================================================================================================
Totals 519,868 464,268 6,345 3,690,937 100.00%
=========================================
7. Additional Shares Eligible
for Issuance Under the 1994
Stock Option Plan 179,387
=========================================
(1) Converted based on result of multiplying number of shares of Series A
Stock owned by $500 liquidation value per share, and dividing that result
by $1.64 conversion price.
(2) Converted based on result of multiplying number of shares of Series B
Stock owned by $1,600 liquidation value per share, and dividing that
result by $4.006 conversion price.
(3) Converted based on result of multiplying number of shares of Series C
Stock owned by $1,000 liquidation value per share, and dividing that
result by $7.2124 conversion price.
(4) Converted based on result of multiplying number of shares of Series D
Stock owned by $1,500 liquidation value per share, and dividing that
result by $7.462 conversion price.
(5) Excluding additional 139,400 if debt outstanding on 3/2000, 3/2001, or
3/2002.
(6) Converted based on result of multiplying number of shares of Series E
Stock owned by $11.4463 liquidation value per share (which increases as
dividends accrue at 7% per annum, compounded annually) and dividing that
result by $11.4463 conversion price.
(7) Fully Diluted Total does not include additional shares eligible for
Issuance under the 1994 Stock Option Plan includes Israel option exercise
for 5,000 shares and Abbe/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ stock transfer.
Schedule 5.3
to
Warrant Purchase Agreement
Subsidiaries
The following corporations are wholly-owned subsidiaries of HealthGate
Data Corp.:
- HealthGate Europe Ltd, a United Kingdom limited company; and
- HealthGate Acquisition Corp. (formerly known as ▇▇▇.▇▇▇, Inc.), a
Delaware corporation (this is an inactive "shell" corporation).
Schedule 5.8
to
Warrant Purchase Agreement
Absence of Certain Developments
- The Company issued 720,757 shares of Series E Preferred Stock to GE Equity
Capital and ▇▇▇▇▇▇▇▇▇ Science, Ltd. pursuant to the April 1999 Stock
Purchase Agreement. As consideration for its 174,729 shares, ▇▇▇▇▇▇▇▇▇
Science, Ltd. cancelled the principal balance of its $2,000,000
Convertible Bridge Promissory Note referred to in item a.i of Schedule 6.8
to the April 1999 Stock Purchase Agreement.
- The Company issued to ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ a Warrant for 5,460 shares of
the Company's common stock in connection with the sale of Series E
Preferred Stock .
- The Company issued 5,000 shares of common stock on May 14, 1999 to ▇▇▇▇
▇▇▇▇▇▇ in connection with Mr. Israel's exercise of a previously granted
stock option.
- In 1999, the Company has purchased from Dell Computer computer equipment
with a cost in excess of $260,000. The Company anticipates making
additional purchases of computer equipment from Dell Computer.
See also Schedule 5.11 for significant agreements involving the Company.
Schedule 5.11
to
Warrant Purchase Agreement
Contracts and Commitments
- HealthGate has granted registration rights to the holders of Series E
Preferred Stock pursuant to a Registration Agreement, dated as of April 7,
1999.
- In connection with the private placement of Series E Preferred Stock, the
Company paid ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ commissions and expenses of
approximately $300,000.
- In connection with a proposed public offering, the Company is obtaining
services from the following firms and entities and the costs of such
services could exceed $100,000 from each service provider:
- PricewaterhouseCoopers
- ▇▇▇▇▇▇▇ Corporation
- Rich, May, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.
- Underwriters.
- The Company is planning to obtain Directors and Officers liability
insurance, the cost of which is expected to exceed $100,000.
- The Company is receiving consulting services from Viant which services are
expected to cost more than $100,000.
See also Schedule 5.8 for recent matters involving the Company.
Schedule 5.13
to
Warrant Purchase Agreement
Litigation
NONE
Schedule 7.4
to
WARRANT PURCHASE AGREEMENT
"Risk Factors"
------------
The Risk Factors are substantially similar to the Risk Factors contained in
Amendment No. 2.