EXHIBIT 4.3
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT
BE SOLD OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS IN ACCORDANCE WITH THE
REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS OR SOME OTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS IS
AVAILABLE WITH RESPECT THERETO.
PREFERRED STOCK PURCHASE WARRANT
Warrant No. _________
PLUMTREE SOFTWARE INC
Void after March 31, 2004
1. Issuance. This Warrant is issued to LIGHTHOUSE CAPITAL PARTNERS II,
L.P. by PLUMTREE SOFTWARE, INC., a California corporation (hereinafter with its
successors called the "Company").
2. Purchase Price; Number of Shares. The registered holder of this
Warrant (the "Holder"), commencing on the date hereof, is entitled upon
surrender of this Warrant with the subscription form annexed hereto duly
executed, at the principal office of the Company, to purchase from the Company
the following securities (collectively, the "Shares") at a price per share (the
"Next Round Purchase Price") equal to the price per share of the Company's next
round of preferred stock raising at least $2,500,000 upon substantially the
terms set forth in Exhibit C (the "Next Round"), that number of fully paid and
nonassessable shares of preferred stock offered in the Next Round (the "Next
Round Preferred Stock") equal to $14,000 divided by the Next Round Purchase
Price; provided however, that if (a) the Next Round does not close on or before
May 31, 1997, or (b) there is a Reorganization (defined below) on or before May
31, 1997, then Holder shall be entitled to purchase, at a price per share equal
to $0.58 (the "Series A Purchase Price"), 24,137 fully paid and nonassessable
shares of Series A Preferred Stock, no par value, of the Company (the "Series A
Preferred Stock").
(The Next Round Purchase Price and the Series A Purchase Price are
sometimes referred to herein collectively, as the "Purchase Price" and the Next
Round Preferred Stock and the Series A Preferred Stock are sometimes referred to
herein collectively, as the "Preferred Stock"). Until such time as this Warrant
is exercised in full or expires, the Purchase Price and the securities issuable
upon exercise of this Warrant are subject to adjustment as hereinafter provided.
The person or persons on whose name or names any certificate representing shares
of Preferred Stock is issued hereunder shall be deemed to have become the holder
of record of the shares represented thereby as at the close of business on the
date this Warrant is exercised with respect to such shares, whether or not the
transfer books of the Company shall be closed.
3. Payment of Purchase Price. The Purchase Price may be paid (i) in cash
or by check, (ii) by the surrender by the Holder to the Company of any
promissory notes or other obligations issued by the Company, with all such notes
and obligations so surrendered being credited against the Purchase Price in an
amount equal to the principal amount thereof plus accrued interest to the date
of surrender, or (iii) by any combination of the foregoing.
4. Net Issue Election. The Holder may elect to receive, without the
payment by the Holder of any additional consideration, shares of Preferred Stock
equal to the value of this Warrant or any portion hereof by the surrender of
this Warrant or such portion to the Company, with the net issue election notice
annexed hereto duly
executed, at the principal office of the Company. Thereupon, the Company shall
issue to the Holder such number of fully paid and nonassessable shares of
Preferred Stock as is computed using the following formula:
X = Y(A-B)
------
A
where: X = the number of shares of Preferred Stock to be issued to the
Holder pursuant to this Section 4.
Y = the number of shares of Preferred Stock covered by this
Warrant in respect of which the net issue election is made
pursuant to this Section 4.
A = the Fair Market Value (defined below) of one share of
Preferred Stock, as determined at the time the net issue
election is made pursuant to this Section 4.
B = the Purchase Price in effect under this Warrant at the time
the net issue election is made pursuant to this Section 4.
"Fair Market Value" of a share of Preferred Stock (or Common Stock if the
Preferred Stock has been automatically converted into Common Stock) as of a
particular date (the "Determination Date") shall mean:
(i) If the net issue election is made in connection with and
contingent upon the closing of the sale of the Company's Common Stock
to the public in a public offering pursuant to a Registration
Statement under the Act (a "Public Offering"), and if the Company's
Registration Statement relating to such Public Offering ("Registration
Statement") has been declared effective by the SEC, then the initial
"Price to Public" specified in the final prospectus with respect to
such offering multiplied by the number of shares of Common Stock into
which each share of Preferred Stock is then convertible.
(ii) If the net issue election is not made in connection with and
contingent upon a Public Offering, then as follows:
(A) If traded on a securities exchange or the Nasdaq
National Market, the fair market value of the Common Stock shall
be deemed to be the average of the closing or last reported sale
prices of the Common Stock on such exchange or market over the
30-day period ending five business days prior to the
Determination Date, and the fair market value of the Preferred
Stock shall be deemed to be such fair market value of the Common
Stock multiplied by the number of shares of Common Stock into
which each share of Preferred Stock is then convertible;
(B) If otherwise traded in an over-the-counter market, the
fair market value of the Common Stock shall be deemed to be the
average of the closing ask prices of the Common Stock over the
30-day period ending five business days prior to the
Determination Date, and the fair market value of the Preferred
Stock shall be deemed to be such fair market value of the Common
Stock multiplied by the number of shares of Common Stock into
which each share of Preferred Stock is then convertible; and
(C) If there is no public market for the Common Stock, then
fair market value shall be determined in good faith by the
Company's Board of Directors.
5. Partial Exercise. This Warrant may be exercised in part, and the
Holder shall be entitled to receive a new warrant, which shall be dated as of
the date of this Warrant, covering the number of shares in respect of which this
Warrant shall not have been exercised.
6. Fractional Shares. In no event shall any fractional share of Preferred
Stock be issued upon any exercise of this Warrant. If, upon exercise of this
Warrant as an entirety, the Holder would, except as provided in this Section 6,
be entitled to receive a fractional share of Preferred Stock, then the Company
shall make a cash payment therefore based upon the Purchase Price then in
effect.
7. Expiration Date; Automatic Exercise. This Warrant shall expire at the
close of business on March 31, 2004, and shall be void thereafter.
Notwithstanding the foregoing, this Warrant shall automatically be deemed to be
exercised in full pursuant to the provisions of Section 4 hereof, without any
further action on behalf of the Holder, immediately prior to the time this
Warrant would otherwise expire pursuant to the preceding sentence.
8. Reserved Shares; Valid Issuance. The Company covenants that it will at
all times from and after June 5, 1997 reserve and keep available such number of
its authorized shares of Preferred Stock and Common Stock, no par value, of the
Company (the "Common Stock"), free from all preemptive or similar rights
therein, as will be sufficient to permit, respectively, the exercise of this
Warrant in full and the conversion into shares of Common Stock of all shares of
Preferred Stock receivable upon such exercise. The Company further covenants
that such shares as may be issued pursuant to such exercise and/or conversion
will, upon issuance, be duly and validly issued, fully paid and nonassessable
and free from all taxes, liens and charges with respect to the issuance thereof.
9. Stock Splits and Dividends. If after the date hereof the Company shall
subdivide the Preferred Stock, by split-up or otherwise, or combine the
Preferred Stock, or issue additional shares of Preferred Stock in payment of a
stock dividend on the Preferred Stock, the number of shares of Preferred Stock
issuable on the exercise of this Warrant shall forthwith be proportionately
increased in the case of a subdivision or stock dividend, or proportionately
decreased in the case of a combination, and the Purchase Price shall forthwith
be proportionately decreased in the case of a subdivision or stock dividend, or
proportionately increased in the case of a combination.
10. Adjustments for Diluting Issuances. The other antidilution rights
applicable to the Preferred Stock and the Common Stock of the Company are set
forth in the Amended and Restated Articles of Incorporation, as amended from
time to time (the "Articles"), a true and complete copy in its current form
which is attached hereto as Exhibit A. Such rights shall not be restated,
amended or modified in any manner which effects the Holder differently than the
holders of Series A Preferred without such Holder's prior written consent. The
Company shall promptly provide the Holder hereof with any restatement, amendment
or modification to the Articles promptly after the same has been made.
11. Mergers and Reclassifications. If after the date hereof the Company
shall enter into any Reorganization (as hereinafter defined), then the Holder
shall thereafter have the right to purchase, at a total price not to exceed that
payable upon the exercise of this Warrant in full, the kind and amount of shares
of stock and other securities and property receivable upon such Reorganization
by a holder of the number of shares of Preferred Stock which might have been
purchased by the Holder immediately prior to such Reorganization, and in any
such case appropriate provisions shall be made with respect to the rights and
interest of the Holder to the end that the provisions hereof (including without
limitation, provisions for the adjustment of the Purchase Price and the number
of shares issuable hereunder and the provisions relating to the net issue
election) shall thereafter be applicable in relation to any shares of stock or
other securities and property thereafter deliverable upon exercise hereof. For
the purposes of this Section 11, the term "Reorganization" shall include without
limitation any reclassification, capital reorganization or change of the
Preferred Stock (other than as a result of a subdivision, combination or stock
dividend provided for in Section 9 hereof or a change in par value or from par
value to no par value or no par value to par value), or any consolidation of the
Company with, or merger of the Company into, another corporation or other
business organization (other than a merger in which the Company is the surviving
corporation and which does not result in any reclassification or change of the
outstanding Preferred Stock), or any sale or conveyance to another corporation
or other business organization of all or substantially all of the assets of the
Company.
12. Certificate of Adjustment. Whenever the Purchase Price is adjusted, as
herein provided, the Company shall promptly deliver to the Holder a certificate
of the Company's chief financial officer setting forth the Purchase Price after
such adjustment and setting forth a brief statement of the facts requiring such
adjustment.
13. Notices of Record Date, Etc. In the event of:
(a) any taking by the Company of a record of the holders of any class
of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution, or any right to
subscribe for, purchase, sell or otherwise acquire or dispose of any shares of
stock of any class or any other securities or property, or to receive any other
right;
(b) any reclassification of the capital stock of the Company, capital
reorganization of the Company, consolidation or merger involving the Company, or
sale or conveyance of all or substantially all of its assets; or
(c) any voluntary or involuntary dissolution, liquidation or winding-
up of the Company;
then in each such event the Company will provide or cause to be provided to the
Holder the notice as provided to the holders of the Preferred Stock or Common
Stock, whichever is applicable, as set forth in the Company's Articles, by-laws,
or the California Corporations Code.
14. Representations, Warranties and Covenants. This Warrant is issued and
delivered by the Company and accepted by each Holder on the basis of the
following representations, warranties and covenants made by the Company:
A. The Company has all necessary authority to issue, execute and
deliver this Warrant and to perform its obligations hereunder. This Warrant has
been duly authorized issued, executed and delivered by the Company and is the
valid and binding obligation of the Company, enforceable in accordance with its
terms.
B. The shares of Series B Preferred Stock issuable upon the exercise
of this Warrant have been duly authorized and reserved for issuance by the
Company and, when issued in accordance with the terms hereof, will be validly
issued, fully paid and nonassessable.
C. The issuance, execution and delivery of this Warrant do not, and
the issuance of the shares of Preferred Stock upon the exercise of this Warrant
in accordance with the terms hereof will not, (i) violate or contravene the
Company's Articles or by-laws, or any law, statute, regulation, rule, judgment
or order applicable to the Company, (ii) violate, contravene or result in a
breach or default under any material contract, agreement or instrument to which
the Company is a party or by which the Company or any of its assets are bound or
(iii) require the consent or approval of or the filing of any notice or
registration with any person or entity except for the filing of notice pursuant
to federal and state securities laws which, if required, the Company covenants
and agrees to file within the prescribed period.
D. So long as this Warrant has not terminated, Holder shall be
entitled to receive such financial and other information as the Holder would be
entitled to receive under the Series A and Series B Preferred Stock Purchase
Agreement if Holder were a holder of that number of shares issuable upon full
exercise of this Warrant.
E. As of the date hereof, the authorized capital stock of the
Company consists of (i) 15,971,421 shares of Common Stock, of which 3,200,000
shares are issued and outstanding and 2,800,000 shares of which are reserved for
future issuance to key employees pursuant to the Company's equity incentive plan
and as founder's stock to key employees and 14,141 shares are reserved for
issuance upon the exercise of this Warrant and the conversion of the Preferred
Stock issued upon such exercise, (ii) 948,276 shares of Series A Preferred
Stock, all of which are issued
and outstanding shares, and (iii) 3,080,303 shares of Series B Preferred Stock,
none of which are issued and outstanding shares and 3,050,303 shares of which
are reserved for future issuance pursuant to the Series A and Series B Stock
Purchase Agreement and 14,141 shares are reserved for issuance upon the exercise
of this Warrant. Attached hereto as Exhibit B is a capitalization table
summarizing the capitalization of the Company, including, without limitation,
the current Conversion Price of the Series A Preferred Stock and Series B
Preferred Stock.
15. Registration Rights. The Company grants to the Holder registration
rights contained in Section 2 of the Company's Investor Rights Agreement dated
as of February 13, 1997 (the "Investor Rights Agreement"), so that (i) the
shares of Common Stock issuable upon conversion of the shares of Preferred Stock
issuable upon exercise of this Warrant shall be "Registrable Securities".
16. Amendment. The terms of this Warrant may be amended, modified or
waived only with the written consent of the Holder.
17. Representations and Covenants of the Holder. This Preferred Stock
Purchase Warrant has been entered into by the Company in reliance upon the
following representations and covenants of the Holder, which by its execution
hereof the Holder hereby confirms:
A. Investment Purpose. The right to acquire Preferred Stock or the
Preferred Stock issuable upon exercise of the Holder's rights contained herein
will be acquired for investment and not with a view to the sale or distribution
of any part thereof, and the Holder has no present intention of selling or
engaging in any public distribution of the same except pursuant to a
registration or exemption.
B. Accredited Investor. Holder is an "accredited investor" within
the meaning of the Securities and Exchange Rule 501 of Regulation D, as
presently in effect.
C. Private Issue. The Holder understands (i) that the Preferred
Stock issuable upon exercise of the Holder's rights contained herein is not
registered under the 1933 Act or qualified under applicable state securities
laws on the ground that the issuance contemplated by this Warrant will be exempt
from the registration and qualifications requirements thereof, and (ii) that the
Company's reliance on such exemption is predicated on the representations set
forth in this Section 17.
D. Financial Risk. The Holder has such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of its investment and has the ability to bear the economic risks of its
investment.
18. Notices, Transfers, Etc.
A. Any notice or written communication required or permitted to be
given to the Holder may be given by certified mail or delivered to the Holder at
the address most recently provided by the Holder to the Company.
B. Subject to compliance with applicable federal and state
securities laws, this Warrant may be transferred by the Holder with respect to
any or all of the shares purchasable hereunder. Upon surrender of this Warrant
to the Company, together with the assignment notice annexed hereto duly
executed, for transfer of this Warrant as an entirety by the Holder, the Company
shall issue a new warrant of the same denomination to the assignee. Upon
surrender of this Warrant to the Company, together with the assignment hereof
properly endorsed, by the Holder for transfer with respect to a portion of the
shares of Preferred Stock purchasable hereunder, the Company shall issue a new
warrant to the assignee, in such denomination as shall be requested by the
Holder hereof, and shall issue to such Holder a new warrant covering the number
of shares in respect of which this Warrant shall not have been transferred.
C. In case this Warrant shall be mutilated, lost, stolen or
destroyed, the Company shall issue a new warrant of like tenor and denomination
and deliver the same (i) in exchange and substitution for and upon surrender and
cancellation of any mutilated Warrant, or (ii) in lieu of any Warrant lost,
stolen or destroyed, upon receipt of an affidavit of the Holder or other
evidence reasonably satisfactory to the Company of the loss, theft or
destruction of such Warrant.
19. No Impairment. The Company will not, by amendment of its Articles or
through any reclassification, capital reorganization, consolidation, merger,
sale or conveyance of assets, dissolution, liquidation, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
of performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the Holder.
20. Governing Law. The provisions and terms of this Warrant shall be
governed by and construed in accordance with the internal laws of the State of
California.
21. Successors and Assigns. This Warrant shall be binding upon the
Company's successors and assigns and shall inure to the benefit of the Holder's
successors, legal representatives and permitted assigns.
22. Business Days. If the last or appointed day for the taking of any
action required or the expiration of any rights granted herein shall be a
Saturday or Sunday or a legal holiday in California, then such action may be
taken or right may be exercised on the next succeeding day which is not a
Saturday or Sunday or such a legal holiday.
23. Qualifying Public Offering. If the Company shall effect a firm
commitment underwritten public offering of shares of Common Stock which results
in the conversion of the Preferred Stock into Common Stock pursuant to the
Company's Articles in effect immediately prior to such offering, then, effective
upon such conversion, this Warrant shall change from the right to purchase
shares of Preferred Stock to the right to purchase shares of Common Stock, and
the Holder shall thereupon have the right to purchased, at a total price equal
to that payable upon the exercise of this Warrant in full, the number of shares
of Common Stock which would have been receivable by the Holder upon the exercise
of this Warrant for shares of Preferred Stock immediately prior to such
conversion of such shares of Preferred Stock into shares of Common Stock, and in
such event appropriate provisions shall be made with respect to the rights and
interest of the Holder to the end that the provisions hereof (including, without
limitation, the provisions for the adjustment of the Purchase Price and of the
number of shares purchasable upon exercise of this Warrant and the provisions
relating to the net issue election) shall thereafter be applicable to any shares
of Common Stock deliverable upon the exercise hereof.
24. Value. The Company and the Holder agree that the value of this
Warrant on the date of grant is $100.
Dated: April 8, 1997 PLUMTREE SOFTWARE, INC.
-----------------------
By: /s/ XXXXXX XXXXXXXXX
---------------------------------
[CORPORATE SEAL] Name: Xxxxxx Xxxxxxxxx
-------------------------------
Title: President and CEO
------------------------------
Attest:
_____________________________
Subscription
To: ____________________________ Date: ___________________________
The undersigned hereby subscribes for _______________________________
shares of Preferred Stock covered by this Warrant. The certificate(s) for such
shares shall be issued in the name of the undersigned or as otherwise indicated
below:
____________________________________
Signature
____________________________________
Name for Registration
____________________________________
Mailing Address
Net Issue Election Notice
To: _________________________ Date:__________________________
The undersigned hereby elects under Section 4 to surrender the right to
purchase ____________________ shares of Preferred Stock pursuant to this
Warrant. The certificate(s) for such shares issuable upon such net issue
election shall he issued in the name of the undersigned or as otherwise
indicated below:
____________________________________
Signature
____________________________________
Name for Registration
____________________________________
Mailing Address
Assignment
For value received _____________________________________________ hereby
sells, assigns and transfers unto ______________________________________________
________________________________________________________________________________
[Please print or typewrite name and address of Assignee]
________________________________________________________________________________
the within Warrant, and does hereby irrevocably constitute and appoint
_________________________________ its attorney to transfer the within Warrant on
the books of the within named Company with full power of substitution on the
premises.
Dated: ___________________________
In the Presence of
__________________________________
