1
EXHIBIT 10.1
AMENDMENT NUMBER NINE TO LOAN AGREEMENT
THIS AMENDMENT to the Loan Agreement entered into as of October 4, 1993,
between ARI NETWORK SERVICES, INC. ("ARI") and WITECH CORPORATION ("WITECH") as
amended (the "Loan Agreement") is entered into as of the 5th day of November,
1996 between ARI and WITECH.
BACKGROUND
This Amendment to the Loan Agreement reflects the mutual understanding and
agreement of the parties to amend the Loan Agreement regarding the provision by
WITECH of a revolving credit facility to ARI.
NOW THEREFORE, the parties agree as follows:
1. Paragraph 2.2(a) is amended to read as follows: "(a) Two Million Dollars
($2,000,000) or". The "Bridge Loan" referenced in Amendment Number Seven to the
Loan Agreement shall bear interest at the rate per annum equal to the Prime Rate
plus 2.0%, retroactive to August 1, 1996.
2. In Exhibit 1.1 in the definition of "Total Loan Commitment" on page
1.1-4, the reference to "One Million Five Hundred Thousand Dollars ($1,500,000)"
is deleted and "Two Million Dollars ($2,000,000)" is substituted therefor.
3. In Exhibit 2.2(a), the reference to $1,500,000.00" is deleted and
$2,000,000.00" is substituted therefor.
4. In Exhibit 1.1 in the definition of "Termination Date" and in the
Revolving Credit Note, the references to December 31, 1996 is deleted and
December 31, 1997 is substituted therefor.
5. The number of shares available for purchase under the Commitment Warrant
described in Paragraph 2.8 of the Loan Agreement is hereby increased to a total
of Six Hundred Thousand (600,000). An Amended and Restated Commitment Warrant
is being executed and delivered contemporaneously herewith.
6. As further consideration hereunder, upon execution hereof, ARI is
delivering to WITECH a Usage Warrant for up to 100,000 Shares of Common Stock of
ARI.
7. Subject to the amendments described herein, the Loan Agreement and
associated documents and agreements remain in full force and effect.
A-1
2
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers as of the date first
above written.
WITECH CORPORATION ARI NETWORK SERVICES, INC.
By: /s/ Xxxxxxx Xxxxxxxxxx By: /s/ Xxxxx Xxxxxxx
------------------------------- -------------------------------------
Xxxxxxx Xxxxxxxxxx, President Xxxxx Xxxxxxx,
President and Chief Executive Officer
A-2
3
AMENDED AND RESTATED COMMITMENT WARRANT
This is to certify that for value received, including, without limitation,
the agreement of WITECH Corporation ("WITECH") to enter into a Loan Agreement
dated October 4, 1993, as amended (the "Loan Agreement") with ARI NETWORK
SERVICES, INC. (the "Company"), WITECH is entitled to purchase shares of the
Company's $.001 par value Common Stock, subject to the terms and conditions more
fully set forth herein.
1. Definitions. This Warrant is the "Commitment Warrant" referred to in
the Loan Agreement. Except as otherwise provided herein, capitalized terms used
herein shall be defined as provided in the Loan Agreement.
2. Number of Shares. This Warrant shall permit WITECH to purchase Six
Hundred Thousand (600,000) shares of Common Stock, as adjusted hereunder (the
"Underlying Shares"). In the event of any stock dividend, stock split, reverse
stock split, recapitalization or reorganization or any similar transaction, the
number of shares of the Common Stock that the holder hereof may acquire upon
exercise hereof and the Exercise Price shall be proportionately and
appropriately adjusted.
3. Exercise Price. The Underlying Shares of the Common Stock that may be
acquired by WITECH pursuant to the exercise of this Warrant may be acquired by
WITECH at a per share price of Two Dollars ($2.00) with respect to 500,000
Underlying Shares and at a per share price of $2.25 with respect to 100,000
Underlying Shares (the "Exercise Price").
4. Adjustment of Exercise Price. In the event that ARI issues any shares
of Common Stock (other than to directors, employees or former employees of the
Company upon the exercise of stock options) ("Newly Issued Common Stock") or
warrants (other than the Usage Warrant) or other securities convertible into
Common Stock (other than stock option grants to directors or employees) ("Newly
Issued Securities") at any time while this Warrant is outstanding and the price
per share of such Newly Issued Common Stock or the exercise price per share
under such Newly Issued Securities is less than the Exercise Price hereunder,
the Exercise Price hereunder with respect to any Underlying Shares shall be
reduced to the per share price of such Newly Issued Common Stock or the exercise
price under such Newly Issued Securities.
5. Exercise. This Warrant may be exercised at any time on or before
September 30, 2000, as to all or part of the Underlying Shares. To exercise
this Warrant, WITECH shall present to the Company this Warrant, together with
the Exercise Price for the number of Underlying Shares to be purchased, in cash
or by certified check or bank draft drawn on immediately available funds,
whereupon this Warrant shall be exercised to the extent specified, and WITECH
shall be the holder of record of the number of shares of Common Stock purchased.
Certificates evidencing such shares shall be delivered to WITECH within a
reasonable time but not exceeding ten (10) days after this Warrant shall have
been exercised as provided herein.
4
6. Representations and Warranties. The Company hereby represents and
warrants to WITECH as follows:
(a) The Company has full corporate power and authority to execute this
Warrant and perform its obligations hereunder.
(b) The execution and delivery of this Warrant and the consummation of the
transactions contemplated hereby have been duly and validly authorized
by all necessary corporate action on the part of the Company. This
Warrant has been duly executed by properly authorized officers of the
Company, and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(c) Neither the execution and delivery of this Warrant nor the
consummation of the transactions contemplated hereby will violate or
result in any violation of or be in conflict with or constitute a
default under any term or condition contained in any judgment, decree,
order, statute, rule or governmental regulation applicable to the
Company or any of its subsidiaries or any of its or their assets.
(d) The Company shall at all times from the date hereof until such time as
its obligations hereunder terminate, reserve for issuance upon
exercise of this Warrant, that number of shares of the Common Stock
equal to the maximum number of shares of the Common Stock which may be
acquired pursuant hereto. Any shares issued pursuant to the exercise
of this Warrant shall be duly and validly issued, fully paid and
nonassessable (other than as provided in Section 180.0622(2)(b) of the
Wisconsin Statutes and the case law interpreting such statute), shall
be free and clear of all liens, security interests, charges, claims or
encumbrances, and shall not have been issued in violation of any
preemptive rights of any stockholders of the Company.
7. Miscellaneous.
(a) This Warrant has not been registered under the Securities Act of 1993
as amended (the "Act"), but rather has been issued pursuant to an
exemption therefrom. This Warrant may not be transferred or assigned
except as expressly permitted herein, and then only in accordance with
a valid registration statement or an exemption form registration under
the provisions of the Act.
(b) This Warrant shall not entitle the holder hereof to any rights as a
stockholder of the Company, either at law or in equity; specifically,
this Warrant shall not entitle the holder hereof to vote on any matter
presented to the stockholders of the Company or to any notice of any
meetings of Stockholders or any other proceedings of the Company.
2
5
(c) If any term, provision, covenant or restriction contained in this
Warrant is held by a court or a federal regulatory agency of competent
jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions and covenants and restrictions contained in this
Warrant shall remain in full force and effect, and shall in no way be
affected, impaired or invalidated. If for any reason such court or
regulatory agency determines that this Warrant will not permit the
holder hereof to acquire the full number of shares of the Common Stock
provide in Paragraph 2, above, it is the express intention of the
Company to allow the holder hereof to acquire such lesser number of
shares as may be permissible, without any amendment or modification
hereof.
(d) This Warrant shall in all respects be governed by and construed in
accordance with the internal laws of the State of Wisconsin.
(e) This Warrant may not be modified, amended, altered or supplemented,
except upon the execution and delivery of a written agreement executed
by the Company and the holder hereof.
(f) This Warrant constitutes the entire agreement of WITECH and the
Company with respect to the matters contained herein, and supersedes
all prior agreements and understandings between the parties with
respect thereto, including the Amended and Restated Commitment
Warrant issued to WITECH dated October 18, 1995 which is superseded
hereby.
IN WITNESS WHEREOF, the Company has executed and delivered this Warrant
effective as of this 5th day of November, 1996.
ARI NETWORK SERVICES, INC.
By:/s/ Xxxxx Xxxxxxx
-------------------------------------
Xxxxx Xxxxxxx
President and Chief Executive Officer
Attest:
By:/s/ Xxxx X. Xxxxxxx
-------------------------------------
Xxxx X. Xxxxxxx, Secretary
3
6
USAGE WARRANT
This is to certify that for value received, including, without limitation,
the agreement of WITECH Corporation ("WITECH") to enter into an Amendment
Number Nine to Loan Agreement on even date herewith with ARI NETWORK SERVICES,
INC. (the "Company"), WITECH is entitled to purchase shares of the Company's
$.001 par value Common Stock, subject to the terms and conditions more fully
set forth herein. Such Loan Agreement, as amended, is referred to herein as
the "Loan Agreement."
1. Number of Shares. This Warrant shall permit WITECH to purchase from
the Company at any time or from time to time during the term hereof the
following number of shares of Common Stock (the "Usage Shares") of the Company:
If the maximum amount of borrowings
under the Loan Agreement at any time The number of
hereafter exceeds Usage Shares shall be
----------------------------------------------- ---------------------
$1.0 million but does not exceed $1.25 million 25,000
$1.25 million but does not exceed $1.50 million 50,000
$1.50 million but does not exceed $1.75 million 75,000
$1.75 million 100,000
In the event of any stock dividend, stock split, reverse stock split,
recapitalization or reorganization or any similar transaction, the number of
shares of the Common Stock that the holder hereof may acquire upon exercise
hereof and the Exercise Price shall be proportionately and appropriately
adjusted.
2. Exercise Price. The exercise price for the Usage Shares that may be
acquired by WITECH pursuant to the exercise of this Warrant shall be $2.25 per
share (the "Exercise Price").
3. Adjustment of Exercise Price. In the event that ARI issues any shares
of Common Stock (other than to directors, employees or former employees of the
Company upon the exercise of stock options) ("Newly Issued Common Stock") or
warrants (other than the Amended and Restated Commitment Warrant) or other
securities convertible into Common Stock (other than stock option grants to
directors or employees) ("Newly Issued Securities") at any time while this
Warrant is outstanding and the price per share of such Newly Issued Common Stock
or the exercise price per share under such Newly Issued Securities is less than
the Exercise Price hereunder, the Exercise Price hereunder with respect to any
Usage Shares shall be reduced to the per share price of such Newly Issued Common
Stock or the exercise price under such Newly Issued Securities.
4. Exercise. This Warrant may be exercised at any time on or before
September 30, 2000, as to all or part of the Usage Shares. To exercise this
Warrant, WITECH shall present to the Company this Warrant, together with the
Exercise Price for the number of Usage Shares to
7
be purchased, in cash or by certified check or bank draft drawn on immediately
available funds, whereupon this Warrant shall be exercised to the extent
specified, and WITECH shall be the holder of record of the number of shares of
Common Stock purchased. Certificates evidencing such shares shall be delivered
to WITECH within a reasonable time but not exceeding ten (10) days after this
Warrant shall have been exercised as provided herein.
5. Representations and Warranties. The Company hereby represents and
warrants to WITECH as follows:
(a) The Company has full corporate power and authority to execute this
Warrant and perform its obligations hereunder.
(b) The execution and delivery of this Warrant and the consummation of the
transactions contemplated hereby have been duly and validly authorized
by all necessary corporate action on the part of the Company. This
Warrant has been duly executed by properly authorized officers of the
Company, and constitutes a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(c) Neither the execution and delivery of this Warrant nor the
consummation of the transactions contemplated hereby will violate or
result in any violation of or be in conflict with or constitute a
default under any term or condition contained in any judgment, decree,
order, statute, rule or governmental regulation applicable to the
Company or any of its subsidiaries or any of its or their assets.
(d) The Company shall at all times from the date hereof until such time as
its obligations hereunder terminate, reserve for issuance upon
exercise of this Warrant, that number of shares of the Common Stock
equal to the maximum number of shares of the Common Stock which may be
acquired pursuant hereto. Any shares issued pursuant to the exercise
of this Warrant shall be duly and validly issued, fully paid and
nonassessable (other than as provided in Section 180.0622(2)(b) of the
Wisconsin Statutes and the case law interpreting such statute), shall
be free and clear of all liens, security interests, charges, claims or
encumbrances, and shall not have been issued in violation of any
preemptive rights of any stockholders of the Company.
6. Miscellaneous.
(a) This Warrant has not been registered under the Securities Act of 1993
as amended (the "Act"), but rather has been issued pursuant to an
exemption therefrom. This Warrant may not be transferred or assigned
except as expressly permitted herein, and then only in accordance with
a valid registration statement or an exemption form registration under
the provisions of the Act.
2
8
(b) This Warrant shall not entitle the holder hereof to any rights as a
stockholder of the Company, either at law or in equity; specifically,
this Warrant shall not entitle the holder hereof to vote on any matter
presented to the stockholders of the Company or to any notice of any
meetings of Stockholders or any other proceedings of the Company.
(c) If any term, provision, covenant or restriction contained in this
Warrant is held by a court or a federal regulatory agency of competent
jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions and covenants and restrictions contained in this
Warrant shall remain in full force and effect, and shall in no way be
affected, impaired or invalidated. If for any reason such court or
regulatory agency determines that this Warrant will not permit the
holder hereof to acquire the full number of shares of the Common Stock
provide in Paragraph 1, above, it is the express intention of the
Company to allow the holder hereof to acquire such lesser number of
shares as may be permissible, without any amendment or modification
hereof.
(d) This Warrant shall in all respects be governed by and construed in
accordance with the internal laws of the State of Wisconsin.
(e) This Warrant may not be modified, amended, altered or supplemented,
except upon the execution and delivery of a written agreement executed
by the Company and the holder hereof.
(f) This Warrant constitutes the entire agreement of WITECH and the
Company with respect to the matters contained herein, and supersedes
all prior agreements and understandings between the parties with
respect thereto.
IN WITNESS WHEREOF, the Company has executed and delivered this Warrant
effective as of this 5th day of November, 1996.
ARI NETWORK SERVICES, INC.
By:/s/ Xxxxx Xxxxxxx
------------------------------------
Xxxxx Xxxxxxx
President and Chief Executive Officer
Attest:
By:/s/ Xxxx X. Xxxxxxx
------------------------------
Xxxx X. Xxxxxxx, Secretary
3
