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EXHIBIT 99.16
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO
THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD
PURSUANT TO RULE 144 OF SUCH ACT.
STOCK PURCHASE WARRANT
To Purchase Shares of Common Stock of
QUADRAMED CORPORATION
THIS CERTIFIES that, for value received, Xxxxx X. Xxxxxx (the
"Executive"), is entitled, upon the terms and subject to the conditions
hereinafter set forth, to subscribe for and purchase, from QuadraMed
Corporation, a California corporation (the "Company"), up to 8,890,000 shares of
Common Stock. The purchase price of one share of Common Stock under this Warrant
shall be equal to $0.15, subject to adjustment as set forth herein (the "Common
Price"), the fair market value of one share of the Company's Common Stock on the
date of this Warrant as determined by the Company's Board of Directors.
1. Exercisability of this Warrant. Provided Executive is performing
services for the Company in the capacity of an employee, consultant or director
at September 26, 2000, this Warrant will thereupon become exercisable for all of
the underlying shares of Common Stock and may be exercised in whole or in part
at any time after September 26, 2000 and before the close of business on
September 26, 2001 after which time this Warrant shall terminate and shall be
void and of no further force or effect.
This Warrant will become exercisable in full before September 26, 2000
upon the following events (each a "Full Acceleration Event"), provided that
Executive is performing services for the Company in the capacity of an employee,
consultant or director at the time of such event:
A. Sale of Assets.
(i) Sale of all or substantially all of the Company's assets
for cash at or above the "Minimum Value" (as determined below) on or before June
30, 2000; or
(ii) Not more than eighteen months after the sale of all or
substantially all of the Company's assets for stock at or above the "Minimum
Value", provided (1) the stock is publicly traded and has a market value of
public float prior to such sale of at least $100 million, (2) the "lockup"
period, if any, limiting sales by officers, directors and principal shareholders
has expired, (3) at the time the lockup period has expired
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the valuation for the Company is at or above the "Minimum Value," and (4) such
event occurs on or before June 30, 2000.
B. Sale of Stock.
(i) Sale of 80% or more of the outstanding capital stock of
the Company for cash at or above the "Minimum Value" on or before June 30, 2000;
or
(ii) Not more than eighteen months after the sale of 80% or
more of the outstanding capital stock of the Company for stock at or above the
"Minimum Value", provided (1) the stock is publicly traded and has a market
value of public float prior to such sale of at least $100 million, (2) the
"lockup" period, if any, limiting sales by officers, directors and principal
shareholders has expired, (3) at the time the lockup period has expired the
valuation for the Company is at or above the "Minimum Value", and (4) such event
occurs on or before June 30, 2000.
C. Merger. Merger of the Company on or before June 30, 2000 with
a corporation, which has a publicly traded security with a market value or
public float prior to the merger of at least $100 million, at a valuation for
the Company at or above the "Minimum Value".
D. Public Offering. Not less than six nor more than eighteen
months after the completion of an initial public offering of the Company's
securities with net proceeds to the Company of not less than $15 million;
provided (1) the "lockup" period limiting sales by officers, directors and
principal shareholders in such offering has expired; (2) at the time the lockup
period has expired the valuation for the Company is at or above the "Minimum
Value" and (3) such lockup period expires on or before June 30, 2000.
As used herein, "Minimum Value" shall mean a value for the Company such
that the value for each share of Common Stock outstanding on the date of
issuance of this Warrant (based on the number of shares then outstanding, on a
fully-diluted basis, including those that would be outstanding upon full
exercise of the Warrant) equals or exceeds the levels set forth below. If the
Minimum Value is not met, but would be met if this Warrant were reduced to a
lesser number of shares, then the number of shares for which this Warrant shall
become exercisable at the time of the Full Acceleration Event shall be reduced
to such number of shares as will permit the Minimum Value to be met. However,
any shares for which this Warrant does not become so exercisable at the time of
the Full Acceleration Event shall remain subject to this Warrant and shall
become exercisable in accordance with the other provisions of this Warrant.
Quarter Share
Ended Price
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Sep 95 $0.96
Dec 95 $0.96
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Mar 96 $0.96
Jun 96 $0.96
Sep 96 $0.96
Dec 96 $0.96
Mar 97 $0.96
Jun 97 $1.09
Sep 97 $1.24
Dec 97 $1.42
Mar 98 $1.59
Jun 98 $1.82
Sep 98 $1.92
Dec 98 $1.92
Mar 99 $1.92
Jun 99 $1.92
Sep 99 $2.01
Dec 99 $2.11
Mar 00 $2.20
In the event the Minimum Value is to be determined at a time when the
Company's Common Stock is traded on an exchange or is quoted on the Nasdaq
National Market, the determination shall be made on the basis of the average
closing sales price for the 20 business days preceding the applicable quarter
ended period. If the Company's Common Stock is not traded on an exchange or on
the Nasdaq National Market, but is traded in the over-the-counter market, the
determination shall be made on the basis of the average closing bid and ask
prices for the 20 business days preceding the applicable quarter ended period.
E. The Board of Directors of the Company shall have complete
discretion, exercisable at any time while this Warrant remains outstanding, to
accelerate the exercisability of this Warrant in full or in part.
2. Procedures to Exercise Warrant. The purchase rights represented by
this Warrant are exercisable by the registered holder hereof by the surrender of
this Warrant and the Subscription Form annexed hereto duly executed at the
office of the Company in Larkspur, California (or other such office or agency of
the Company as it may designate by notice in writing to the registered holder
hereof at the address of such holder appearing on the books of the Company), and
upon payment of the purchase price of the shares thereby purchased (by cash or
by check or bank draft payable to the order of the Company or by cancellation of
indebtedness of the Company to the holder hereof, if any, at the time of
exercise in an amount equal to the purchase price of the shares thereby
purchased) whereupon the holder of this Warrant shall be entitled to receive a
certificate for the number of shares of Common Stock so purchased. The Warrant
may also be exercised in whole or in part through a special sale and remittance
procedure pursuant to which the Executive shall concurrently provide irrevocable
written instructions (a) to a Company-designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Company, out of the sale
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proceeds available on the settlement date, sufficient funds to cover the
aggregate exercise price payable for the purchased shares plus all applicable
Federal, state and local income and employment taxes required to be withheld by
the Company by reason of such exercise and (b) to the Company to deliver the
certificates for the purchased shares directly to such brokerage firm in order
to complete the sale. The Company agrees that if at the time of the surrender of
this Warrant and purchase the holder hereof shall be entitled to exercise this
Warrant, the shares so purchased shall be and be deemed to be issued to such
holder as the record owner of such shares as of the close of business on the
date on which this Warrant shall have been exercised as aforesaid. Certificates
for shares purchased hereunder shall be delivered to or on behalf of the holder
hereof within a reasonable time after the date on which this Warrant shall have
been exercised as aforesaid. The Company covenants that all shares of Common
Stock which may be issued upon the exercise of rights represented by this
Warrant will, upon exercise of the rights represented by this Warrant, be fully
paid and nonassessable and free from all taxes, liens and charges in respect of
the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).
3. No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon the exercise of
this Warrant, an amount equal to such fraction multiplied by the then current
price at which each share may be purchased hereunder shall be paid in cash to
the holder of this Warrant.
4. Charges, Taxes and Expenses. Issuance of certificates for shares
of Common Stock upon the exercise of this Warrant shall be made without charge
to the holder hereof for any issue or transfer tax or other incidental expense
in respect of the issuance of such certificate, all of which taxes and expenses
shall be paid by the Company, and such certificates shall be issued in the name
of the holder of this Warrant or in such name or names as may be directed by the
holder of this Warrant; provided, however, that in the event certificates for
shares of Common Stock are to be issued in a name other than the name of the
holder of this Warrant, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form attached hereto duly executed by the holder
hereof; and provided, further, that upon any transfer involved in the issuance
or delivery of any certificates for shares of Common Stock, the Company may
require, as a condition thereto, the payment of a sum sufficient to reimburse it
for any transfer tax incidental thereto.
5. No Rights as Shareholder. This Warrant does not entitle the holder
hereof to any voting rights or other rights as a shareholder of the Company
prior to the exercise thereof.
6. Exchange and Registry of Warrant. This Warrant is exchangeable,
upon the surrender hereof by the registered holder at the above-mentioned office
or agency of the Company, for a new warrant of like tenor and dated as of such
exchange. The Company shall maintain at the above-mentioned office or agency a
registry showing the name and address of the registered holder of this Warrant.
This Warrant may be surrendered for exchange, transfer
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or exercise, in accordance with its terms, at such office or agency of the
Company, and the Company shall be entitled to rely in all respects, prior to
written notice to the contrary, upon such registry.
7. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by
the Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to it, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new Warrant of like tenor and dated as of such cancellation,
in lieu of this Warrant.
8. Saturdays, Sundays, Holidays, etc. If the last or appointed day
for the taking of any action or the expiration of any right required or granted
herein shall be a Saturday or a Sunday or shall be a legal holiday, then such
action may be taken or such right may be exercised on the next succeeding day
not a legal holiday.
9. Adjustment to Number and Type of Securities and Authorized Shares.
A. Adjustment. If the Company at any time shall, by subdivision,
combination or reclassification of securities or otherwise, change any of the
securities to which purchase rights under this Warrant exist into the same or a
different number of securities of any class or classes, this Warrant shall
thereafter represent the right to acquire such number and kind of securities as
would have been issuable as the result of such change with respect to the
securities which were subject to the purchase rights under this Warrant
immediately prior to such subdivision, combination, reclassification or other
change. If shares of the Company's Common Stock are subdivided or combined into
a greater or smaller number of shares of Common Stock, the purchase price under
this Warrant shall be proportionately reduced in the case of subdivision of
shares or proportionately increased in the case of combination of shares, in
both cases by the ratio which the total number of shares of Common Stock to be
outstanding immediately after such event bears to the total number of shares of
Common Stock outstanding immediately prior to such event.
B. Mergers, Consolidations or Sale of Assets. If at any time
there shall be a capital reorganization of the Common Stock (other than a
combination, reclassification, exchange or subdivision otherwise provided for
herein), or a merger or consolidation of the Company with or into another
corporation in which the Company is not the surviving corporation, or the sale
of the Company's properties and assets as, or substantially as, an entirety to
any other person, then, as a part of such reorganization, merger, consolidation
or sale, lawful provision shall be made so that the Executive shall thereafter
be entitled to receive upon exercise of this Warrant, during the period
specified in this Warrant and upon payment of the purchase price then in effect,
the number of shares of stock or other securities or property of the successor
corporation resulting from such reorganization, merger, consolidation or sale,
to which a holder of the Company's Common Stock would have been
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entitled under the provisions of the agreement in such reorganization, merger,
consolidation or sale if this Warrant had been exercised immediately before that
reorganization, merger, consolidation or sale. In any such case, appropriate
adjustment (as determined in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Warrant with respect
to the rights and interests of the Executive after the reorganization, merger,
consolidation or sale to the end that the provisions of this Warrant (including
adjustment of the purchase price then in effect and the number of shares
issuable hereunder) shall be applicable after that event, as near as reasonably
may be, in relation to any shares or other property deliverable after that event
upon exercise of this Warrant.
C. Cash Distributions. No adjustment on account of cash
dividends or interest on the Company's Common Stock or other securities
purchasable hereunder will be made to the purchase price under this Warrant.
D. Authorized Shares. The Company covenants that during the
period the Warrant is outstanding, it will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of Common Stock upon the exercise of any purchase rights under this Warrant. The
Company further covenants that its issuance of this Warrant shall constitute
full authority to its officers who are charged with the duty of executing stock
certificates to execute and issue the necessary certificates for shares of the
Company's Common Stock upon the exercise of the purchase rights under this
Warrant.
10. Miscellaneous.
A. Issue Date. The provisions of this Warrant shall be construed
and shall be given effect in all respects as if it had been issued and delivered
by the Company on the date hereof. This Warrant shall be binding upon any
successors or assigns of the Company. This Warrant shall constitute a contract
under the laws of the State of California and for all purposes shall be
construed in accordance with and governed by the laws of said state.
B. Restrictions; Registration. The holder hereof acknowledges
that the Common Stock acquired upon the exercise of this Warrant may have
restrictions upon its resale imposed by state and federal securities laws. The
Company acknowledges that this Warrant has been issued to Executive in
consideration of services provided and to be provided to the Company, and that
absent registration of the Common Stock issuable hereunder under the Securities
Act of 1933, upon exercise Executive will be unable to sell such Common Stock
into the public market. Accordingly, Company agrees to include such Common Stock
in a registration statement on Form S-8 (or similar successor form) promptly
following the completion of an initial public offering of the Company's Common
Stock and to keep such registration statement effective until the earlier of (i)
the termination of the Warrant or (ii) 90 days following the exercise of the
Warrant for all of the shares issuable hereunder.
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C. Non-Assignment. This Warrant and any rights hereunder are not
transferable by the Executive, other than a transfer by will or the laws of
intestate succession following the Executive's death, and the transferee shall
have all the rights of the Executive to exercise this Warrant in accordance with
its terms.
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IN WITNESS WHEREOF, QuadraMed Corporation has caused this Warrant to be
executed by its officer thereunto duly authorized.
Dated: September 27, 1995
QUADRAMED CORPORATION
By: /s/Xxxx X. Xxxxxxxxxx
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Title: Executive V.P., CFO & Secretary
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NOTICE OF EXERCISE
To:_________________
(1) The undersigned hereby elects to purchase shares of Common Stock
of QuadraMed Corporation pursuant to the terms of the attached Warrant, and
tenders herewith payment of the purchase price in full, together with all
applicable transfer taxes, if any.
(2) Please issue a certificate or certificates representing said
shares of Common Stock in the name of the undersigned or in such other name as
is specified below:
______________________________
(Name)
______________________________
(Address)
____________________ _________________________________________
(Date) (Signature)
