EXHIBIT 2(b)
OPTION AGREEMENT
OPTION AGREEMENT, dated as of November 22, 2000 (the "Agreement")
between Thinking Technologies, L.P., a Delaware limited partnership ("Optionee")
whose address is 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Xxxxxxx Xxx, an
individual ("Xxx"), whose address is c/o XxxxxXxxx.xxx, 00000 Xxxxxxxxxx Xxxx,
Xxxxx 000, Xxxxxxxxxx, Xxxx, 00000, and Tritium Networks, Inc., a Delaware
Corporation ("Tritium") whose address is c/o XxxxxXxxx.xxx, 00000 Xxxxxxxxxx
Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxx, 00000.
RECITALS:
Reference is made to the bridge loans made by Optionee to Thinking
Tools, Inc. (the "Company") in the aggregate principal amount of up to
$1,000,000 (the "Bridge Loans") evidenced by a Convertible Demand Promissory
Note (the "Note"), dated as of November 22, 2000. Unless otherwise defined
herein, capitalized terms shall have the meaning given to such terms in the
Note.
This Option Agreement is integral to the advances made and which may be
made by Optionee to the Company.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledged, and in connection with advances to the Company
under and in accordance with the terms of the Note, the parties hereto hereby
agree as follows:
1. Reference to the Note. The terms, conditions and provisions of the
Note are incorporated herein by reference, the same as if set forth herein
verbatim, which terms, conditions, and provisions shall continue to be in full
force and effect hereunder until all sums due and to become due thereunder or
under any other documents in connection with the Bridge Loans have been paid or
repaid in full.
2. Grant of Option. Upon the terms and subject to the conditions set
forth herein, Xxx hereby grants to Optionee the right and option (the "Option")
to purchase from him up to 600,000 shares (the "Option Shares") of the Company's
Series A Convertible Preferred Stock, par value $.001 per share (the "Preferred
Shares"), which shares shall include, without limitation, any dividends,
distributions and other securities issued upon conversion of the Preferred
Shares. Further, in the event that this Option becomes exercisable prior to the
liquidation of Tritium and, at such time, Tritium is then the record owner of
the Preferred Shares, Tritium hereby grants to the Optionee the right and option
to purchase from Tritium the Preferred Shares on the same terms and conditions
as the Option granted by Xxx to Optionee.
3. Purchase Price. The purchase price (the "Purchase Price") for the
Option Shares shall be an aggregate price of $100, reduced proportionately if
less than all of the Option Shares are purchased, subject to adjustment as set
forth herein.
4. Time of Exercise; Term. (a) The Option shall become exercisable with
respect to the underlying Option Shares upon the failure of the Company to pay,
when due, the principal of and interest on the Note upon demand therefor. No
waiver, amendment, modification, compromise or settlement in respect of the Note
or exercise of Optionee's right to convert the Note into shares of Common Stock
of the Company shall in any way affect Optionee's rights under the Option.
(b) The Option shall expire and cease to have any force or effect on
the date on which all amounts and obligations under the Note have been paid and
performed in full (the "Expiration Date").
5. Method of Exercising Option and Payment of Purchase Price. The
Option shall be exercised by the delivery by the Optionee to Xxx or Tritium, as
the case may be, at the respective addresses set forth above of written notice
of the number of Option Shares with respect to which the Option is exercised,
accompanied by payment in full of the aggregate Purchase Price for such Option
Shares. Payment for such Option Shares shall be made in U.S. dollars by check
payable to the order of Xxx or Tritium, as the case may be, or by wire transfer
to an account designated by Xxx or Tritium, as the case may be. Within ten days
after each such exercise of this Option, Xxx or Tritium, as the case may be,
shall cause to be delivered to Optionee a certificate or certificates evidencing
the Option Shares registered in the name of Optionee or its designee. Upon
receipt by Xxx or Tritium, as the case may be, of a notice of exercise of the
Option, Optionee shall be deemed to be the holder of record of the Option Shares
transferable upon such exercise, notwithstanding that the stock transfer books
of the Company shall then be closed or that certificates representing such
Option Shares shall not then be physically delivered to Optionee.
6. Representations. Xxx and Tritium hereby represent that (i) each of
Xxx and Tritium has the legal capacity or authority, as the case may be, to
enter into and execute this Agreement and that Tritium is authorized to enter
into this Agreement; (ii) Xxx is entitled to receive the Preferred Shares upon
the liquidation of Tritium, of which Xxx is a principal shareholder; and (iii)
other than the Voting Agreement, dated as of March 7, 2000, by and among the
Company, Optionee, Xxxx Xxxxx, Tritium and the stockholders of Tritium whose
names appear on the signature pages thereof, the Preferred Shares are not
subject to any option, warrant, put, call or other right to purchase, stock
transfer restriction, other agreement, understanding or arrangement of any kind
relating to the voting or disposition thereof, lien, encumbrance, security
interest or pledge.
7. Restrictions on Transfer. Other than the distribution to Xxx upon
the liquidation of Tritium and as otherwise provided in the Voting Agreement,
until the purchase of the Option Shares pursuant to this Option Agreement or the
expiration of the period for exercise of the Option, neither Xxx nor Tritium
shall Transfer (defined below) the Option Shares. For the purposes of this
Agreement, "Transfer", means any transfer, sale, exchange, assignment, the
creation of any option or right to purchase, security interest or other
encumbrance, and any other disposition of any kind, whether voluntary or
involuntary, affecting title to, possession of or voting rights of the Option
Shares.
8. Legend. Until such time as the Option is exercised with respect to
all of the Option Shares, all stock certificates evidencing the Option Shares
shall include a legend as follows:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AN OPTION
AGREEMENT DATED NOVEMBER 22, 2000 BETWEEN THINKING TECHNOLOGIES, L.P.,
XXXXXXX XXX, AND TRITIUM NETWORKS, INC., A COPY OF WHICH IS ON FILE
WITH THE SECRETARY OF THE COMPANY."
9. Transfer and Investment Representation. Optionee represents that,
unless at the time of exercise of the Option the Option Shares are registered
under the Securities Act of 1933, any and all Option Shares purchased hereunder
shall be acquired for investment only and without a view to the resale or
distribution thereof. If the Option Shares are not so registered, certificates
for the Option Shares shall bear a legend reciting the fact that such Option
Shares may only be transferred pursuant to an effective registration statement
under the Securities Act of 1933 or an opinion of counsel to the Company (or an
opinion of counsel to Optionee reasonably satisfactory to the Company) that such
registration is not required.
10. No Rights in Option Shares. Optionee shall have none of the rights
of a shareholder with respect to the Option Shares unless and until the Option
Shares are issued to it upon exercise of the Option.
11. Governing Law/Jurisdiction. This Option Agreement shall be governed
by and construed and enforced in accordance with the laws of the State of New
York applicable to contracts made and to be performed wholly within such State.
Any action or proceeding in connection with this Agreement may be brought in a
court of record of the State of New York, County of New York or any federal
court located therein, the parties hereby consenting to the jurisdiction
thereof, and service of process may be made upon any party by mailing a copy
thereof to such party, by registered mail, at its address to be used for the
giving of notices under this Agreement. IN ANY ACTION OR PROCEEDING RELATING TO
THIS AGREEMENT, THE PARTIES MUTUALLY WAIVE TRIAL BY JURY AND ANY CLAIM THAT NEW
YORK COUNTY IS AN INCONVENIENT FORUM.
12. Miscellaneous. This Option Agreement cannot be changed or terminated orally.
This Option Agreement contains the entire agreement between the parties relating
to the subject matter hereof. The paragraph headings herein are intended for
reference only and shall not affect the interpretation hereof. All notices under
this Agreement shall be given in accordance with Section 12 of the Note. This
Agreement may be executed in any number of counterparts and by telecopier, each
of which shall constitute an original, and all of which taken together shall
constitute one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have executed this Option
Agreement as of the day and year first above written.
THINKING TECHNOLOGIES, L.P.
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx
Title:
XXXXXXX XXX
By: /s/ Xxxxxxx Xxx
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Name: Xxxxxxx Xxx
TRITIUM NETWORKS, INC.
By: /s/ Xxxxxxx Xxx
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Name: Xxxxxxx Xxx
Title: President
