EXHIBIT 10.49
THIS WARRANT, THE SHARES OF SERIES C PREFERRED STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH
SHARES OF SERIES C PREFERRED STOCK HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT
IN EFFECT WITH RESPECT TO SUCH SECURITIES, OR DELIVERY OF AN OPINION OF COUNSEL
IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES THAT SUCH
OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE WITH THE
SECURITIES ACT.
Banyan Systems Incorporated
Series C Convertible Preferred
Stock Purchase Warrant
Expiring March 5, 2005
Banyan Systems Incorporated (the "Company"), a Massachusetts
corporation, for value received, hereby certifies that HarbourVest Venture
Partners V-Direct Fund L.P., or registered assigns, is entitled to purchase from
the Company 65,790 duly authorized, validly issued, fully paid and nonassessable
shares of Series C Convertible Preferred Stock, par value $.01 per share, of the
Company (the "Warrant Shares") at an exercise price per share of $50.00 (as
adjusted as provided herein, the "Exercise Price"), at any time or from time to
time prior to 5 P.M., New York City time, on March 5, 2005, all subject to the
terms, conditions and adjustments set forth below in this Warrant, provided
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that, notwithstanding anything contained herein to the contrary, if the Series C
Preferred Stock is automatically converted into Common Stock of the Company
pursuant to Section 3(b) of the Certificate of Vote of Directors Establishing a
Class or Series of Stock, then this Warrant shall be exercisable for such number
of shares of Common Stock of the Company deliverable upon the conversion of the
Series C Preferred Stock issuable upon exercise of this Warrant immediately
prior to such automatic conversion, at an exercise price equal to the then
Series C Convertible Preferred Stock Conversion Price (as such number of shares
of Common Stock of the Company and such exercise price may be further adjusted
for stock splits, subdivisions or combinations) and thereafter all references in
this Warrant to"Warrant Shares" and "Series C Preferred Stock" shall mean such
shares of Common Stock of the Company.
Section 1. Exercise of Warrants.
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(a) Upon the terms and subject to the conditions set forth in this
Warrant, each holder of Warrants shall have the right, which may be exercised
until 5:00 p.m., New York City time, on March 5, 2005 (the "Expiration Time"),
to receive from the Company the number of fully paid and nonassessable Warrant
Shares which the holder may at the time be entitled to receive upon exercise of
this Warrant and payment of the Exercise Price then in effect for such Warrant
Shares. Each Warrant not exercised prior to the Expiration Time shall be deemed
automatically exercised in accordance with the last sentence of the following
paragraph (even if the form of election to purchase attached hereto is not
delivered) immediately prior to such Expiration Time.
(b) Warrants may be exercised upon surrender to the Company of this
Warrant with the form of election to purchase attached hereto duly filed in and
signed and upon payment to the Company of the Exercise Price for each of the
Warrant Shares in respect of which such Warrants are then exercised. Payment of
the aggregate Exercise Price shall be made at the principal offices of the
Company by certified or official bank check to the order of the Company. In
lieu of exercising any Warrant by paying in full the Exercise Price plus
transfer taxes (if applicable pursuant to Section 2), if any, the holder may,
from time to time, convert such Warrant, in whole or in part, into such number
of Warrant Shares determined by dividing (a) the aggregate Current Market Value
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of the number of Warrant Shares represented by such Warrant, minus the sum of
the aggregate Exercise Price for such Warrant Shares plus transfer taxes, if
any, by (b) the Current Market Value of one Warrant Share (such conversion, a
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"Cashless Exercise").
Current Market Value at any date means:
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(i) if the Company's Common Stock is not registered under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
determined in good faith by the Company's Board of Directors, upon review
of the relevant facts,
(ii) if the Company's Common Stock is registered under the Ex change
Act, the product of (A) the number of shares of the Company's Common Stock
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issuable upon conversion of one Warrant Share times (B) the average of the
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daily closing sale prices (or if sale prices are not available, bid prices)
for each business day during the period commencing 10 business days before
the date one day prior to the exercise date and ending on the date one day
prior to date of exercise.
(c) Subject to the provisions of Section 2 hereof, upon such
surrender of Warrants and (other than in a Cashless Exercise) payment of the
Exercise
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Price, the Company shall issue and cause to be delivered with all
reasonable dispatch to or upon the written order of the Warrant holder and in
such name or names as the Warrant holder may designate, a certificate or
certificates for the number of full Warrant Shares issuable upon the exercise of
such Warrants together with cash as provided in Section 1(e); provided, however,
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that if any consolidation, merger, transfer or lease of assets is proposed to be
effected by the Company as described in Section 5 hereof, or a tender offer or
an exchange offer for Warrant Shares shall be made, upon such surrender of
Warrants and payment of the Exercise Price as aforesaid, the Company shall, as
soon as possible, but in any event not later than three business days
thereafter, issue and cause to be delivered the full number of Warrant Shares
issuable upon the exercise of such Warrants in the manner described in this
sentence and/or any other consideration to be issued to such Warrant holder
pursuant to Section 5 hereof together with cash as provided in Section 1(e).
Such certificate or certificates shall be deemed to have been issued and any
person so designated to be named therein shall be deemed to have become a holder
of record of such Warrant Shares as of the date of the surrender of such
Warrants and (other than in a Cashless Exercise) payment of the Exercise Price.
(d) The Warrants shall be exercisable, at the election of the holders
thereof, either in full or from time to time in part, and, in the event that a
certificate evidencing Warrants is exercised in respect of fewer than all of the
Warrant Shares issuable upon such exercise at any time prior to the date of
expiration of the Warrants, a new certificate evidencing the remaining Warrant
or Warrants will be issued and delivered pursuant to the provisions of this
Section 1.
(e) The Company shall not be required to issue fractional Warrant
Shares upon the exercise of Warrants. In lieu of any fractional Warrant Share,
the Company shall make a cash payment equal to the Exercise Price multiplied by
such fraction.
(f) Until the exercise of this Warrant, the registered holder of this
Warrant shall not have any rights by virtue hereof as a stockholder of the
Company.
Section 2. Payment of Taxes. The Company will pay all
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documentary stamp taxes attributable to the initial issuance of Warrant Shares
upon the exercise of Warrants; provided, however, that the Company shall not be
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required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issue of any Warrant or any certificates for Warrant Shares in a
name other than that of the registered holder of a Warrant surrendered upon the
exercise of such Warrant, and the Company shall not be required to issue or
deliver such Warrant or certificates for Warrant Shares unless or until the
person or persons requesting the issuance thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid.
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Section 3. Mutilated or Missing Warrant. Upon receipt by the
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Company of evidence and indemnity satisfactory to it of the loss, theft,
destruction or mutilation of, and upon surrender and cancellation of this
Warrant, if mutilated, the Company will make and deliver in lieu of this Warrant
a new Warrant of the same series and of like tenor of this Warrant.
Section 4. Reservation of Warrant Shares and Conversion Shares.
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(a) The Company will at all times reserve and keep available, free
from preemptive rights, out of the aggregate of its authorized but unissued
Series C Preferred Stock or its authorized and issued Series C Preferred Stock
held in its treasury, for the purpose of enabling it to satisfy any obligation
to issue Warrant Shares upon exercise of Warrants, the maximum number of shares
of Series C Preferred Stock which may then be deliverable upon the exercise of
all outstanding Warrants. The Company covenants that all Warrant Shares which
may be issued upon exercise of Warrants will, upon payment of the Exercise Price
therefor and the issuance thereof, be fully paid, nonassessable, free of
preemptive rights, free from all taxes (subject to Section 2 hereof) and free
from all liens, charges and security interests, created by or through the
Company, with respect to the issue thereof. Notwithstanding anything to the
contrary contained herein, this warrant shall not be exercised until July 30,
1998.
(b) At all times after July 30, 1998, the Company will at all times
reserve and keep available, free from preemptive rights, out of the aggregate of
its authorized but unissued Common Stock or its authorized and issued Common
Stock held in its treasury, for the purpose of enabling it to satisfy any
obligation to issue Common Stock upon conversion of Series C Preferred Stock
issued or issuable upon exercise of Warrants, the maximum number of shares of
Common Stock (the "Conversion Shares") which may then be deliverable upon the
conversion of all Series C Preferred Stock issuable upon exercise of all
outstanding Warrants. The Company covenants that all Conversion Shares which
may be issued thereof, be fully paid, nonassessable, free of preemptive rights,
free from all taxes and free from all liens, charges and security interests,
created by or through the Company, with respect to the issue thereof.
Section 5. Reorganization of the Company. If the Company
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consolidates or mergers with or into, or transfers or leases all or
substantially all its assets to, any person, upon consummation of such
transaction the Warrants shall automatically become exercisable for the kind and
amount of securities, cash or other assets which the holder of a Warrant would
have owned immediately after the consolidation, merger, transfer or lease if
the holder had exercised the Warrant (and, if the holder so elects, if the
holder had exercised the Warrant and converted the Warrant Shares issuable upon
exercise of such Warrant) immediately before the effective date of the
transaction. Concurrently with the consummation of such transaction, the
cor-
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poration formed by or surviving any such consolidation or merger if other
than the Company, or the person to which such sale or conveyance shall have been
made, shall enter a Warrant Agreement (in form and substance satisfactory to
holders of two-thirds of the outstanding shares of Series C Preferred Stock as
determined in accordance with Paragraph 5) so providing and further providing
for adjustments which shall be as nearly equivalent as may be practical to the
adjustments provided for in this Section 5.
Section 6. Changes Affecting the Series C Preferred Stock. The
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Company shall not, without the written consent of the holders of two-thirds of
the outstanding shares of Series C Preferred Stock, issue any shares of Series C
Preferred Stock except upon the exercise of Warrants. The Company shall not,
without the written consent of the holders of two-thirds of the outstanding
shares of Series C Preferred Stock, split, subdivide, combine or reclassify the
Series C Preferred Stock or change, in any manner adverse to any holder of
Series C Preferred Stock, any pro vision of the Articles of Organization of the
Company relating to the designations, preferences, powers, rights and privileges
of the Series C Preferred Stock. For purposes of the preceding sentences and
Paragraph 5, holders of outstanding Warrants shall be deemed to hold the shares
of Series C Preferred Stock issuable under such Warrants. If the Company at any
time while this Warrant, or any portion thereof, remains outstanding and
unexpired shall (with the consent referred to above) split, subdivide or combine
the Series C Preferred Stock into a different number of securities of the same
class, the Exercise Price for such securities shall be proportionately decreased
in the case of a split or subdivision or proportionately increased in the case
of a combination and the number of the securities as to which purchase rights
under this Warrant exist shall be increased or decreased proportionately in
accordance with such split subdivision or combination.
Section 7. Adjustments to Conversion Price. If any one or more
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events specified in Section 3 of the Certificate of Vote of Directors
Establishing a Class or Series of Stock of the Series A Preferred Stock, Series
B Preferred Stock and Series C Preferred Stock of the Corporation which would
give rise to an adjustment of the Series C Preferred Conversion Price (as
defined in such Certificate of Vote of Directors Establishing a Class or Series
of Stock) of the Series C Preferred Stock shall occur, the Series C Preferred
Conversion Price of the shares of Series C Preferred Stock issued upon the
exercise thereafter of any Warrant shall be adjusted retroactively to reflect
the adjustment as if such shares of Series C Preferred Stock had been
outstanding at the time of such event or events.
Section 8. Governing Law. THIS WARRANT SHALL BE DEEMED TO BE A
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CONTRACT MADE UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS AND FOR ALL
PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF
MASSACHUSETTS.
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IN WITNESS WHEREOF, Banyan Systems Incorporated has caused this
Warrant to be duly executed, as of March 5, 1998.
BANYAN SYSTEMS INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President, Chief Financial
Officer, Treasurer and Secretary
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Form of Election to Purchase
(To be Executed Upon Exercise of Warrant)
The undersigned hereby irrevocably elects to exercise Warrants
containing the right to receive ____ shares of Series C Preferred Stock and
herewith (check item) tenders payment for such shares to the order of Banyan
Systems Incorporated in the amount of ______ per share of Series C Preferred
Stock in accordance with the terms hereof, as follows:
____ $_____ by certified or official bank check to the order of
Banyan Systems Incorporated; or
____ $_____ by surrender of Warrant Shares having a Current
Market Value (as defined in the Warrant Agreement) of $_______.
The undersigned requests that a certificate for such shares be
registered in the name of _______________, whose address
is_____________________, and that such shares be delivered to
__________________, whose address is ____________________.
If said numbers of shares is less than all of the shares of Series C
Preferred Stock purchasable under the Warrant, the undersigned requests that a
new Warrant representing the remaining balance of such Warrants be registered in
the name of _______________, whose address is_____________________, and that
such shares be delivered to __________________, whose address is
____________________.
Date:_____________ Your Signature:__________________________
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