EXHIBIT 10.15
MERCATA, INC.
SERIES C PREFERRED STOCK PURCHASE AGREEMENT
Table of Contents
Page
1. Agreement To Sell And Purchase............................. 1
1.1 Authorization of Shares............................... 1
1.2 Sale and Purchase..................................... 1
2. Closing, Delivery And Payment.............................. 2
2.1 Closing............................................... 2
2.2 Delivery.............................................. 2
2.3 Subsequent Sales of Shares............................ 2
3. Representations And Warranties Of The Company.............. 2
3.1 Organization, Good Standing and Qualification......... 2
3.2 Subsidiaries.......................................... 3
3.3 Capitalization; Voting Rights......................... 3
3.4 Authorization; Binding Obligations.................... 3
3.5 Financial Statements.................................. 4
3.6 Liabilities........................................... 4
3.7 Agreements; Action.................................... 4
3.8 Obligations to Related Parties........................ 5
3.9 Changes............................................... 5
3.10 Title to Properties and Assets; Liens, Etc............ 6
3.11 Patents and Trademarks................................ 7
3.12 Compliance with Other Instruments..................... 7
3.13 Litigation............................................ 7
3.14 Tax Returns and Payments.............................. 8
3.15 Employees............................................. 8
3.16 Proprietary Information and Inventions Agreements..... 8
3.17 Registration Rights and Voting Rights................. 9
3.18 Compliance with Laws; Permits......................... 9
3.19 Offering Valid........................................ 9
3.20 Full Disclosure....................................... 9
3.21 Insurance............................................. 10
i
Table of Contents
(continued)
Page
4. Representations And Warranties Of The Purchasers............. 10
4.1 Requisite Power and Authority........................... 10
4.2 Investment Representations.............................. 10
4.3 Transfer Restrictions................................... 11
5. Conditions To Closing........................................ 12
5.1 Conditions to Purchasers' Obligations at the Closing.... 12
5.2 Conditions to Obligations of the Company................ 13
6. Miscellaneous................................................ 14
6.1 Governing Law........................................... 14
6.2 Survival................................................ 14
6.3 Successors and Assigns.................................. 14
6.4 Entire Agreement........................................ 14
6.5 Severability............................................ 14
6.6 Amendment and Waiver.................................... 14
6.7 Delays or Omissions..................................... 15
6.8 Waiver of Conflicts..................................... 15
6.9 Notices................................................. 15
6.10 Expenses................................................ 16
6.11 Attorneys' Fees......................................... 16
6.12 Titles and Subtitles.................................... 16
6.13 Counterparts............................................ 16
6.14 Broker's Fees........................................... 16
6.15 Exculpation Among Purchasers............................ 16
6.16 Confidentiality......................................... 16
6.17 Pronouns................................................ 17
6.18 California Corporate Securities Law..................... 17
ii
List Of Exhibits
Exhibit A Schedule of Purchasers
Exhibit B Form of Convertible Promissory Note
Exhibit C Amended and Restated Certificate of Incorporation
Exhibit D Amended and Restated Investor Rights Agreement
Exhibit E Amended and Restated Co-Sale Agreement
Exhibit F Amended and Restated Voting Agreement
Exhibit G Proprietary Information and Inventions Agreement
Exhibit H Form of Legal Opinion
iii
MERCATA, INC.
SERIES C PREFERRED STOCK PURCHASE AGREEMENT
This Series C Preferred Stock Purchase Agreement (this "Agreement") is
entered into as of March 1, 2000, by and among Mercata, Inc., a Delaware
corporation (the "Company") and each of those persons and entities, severally
and not jointly, whose names are set forth on the Schedule of Purchasers
attached hereto as Exhibit A (which persons and entities are hereinafter
collectively referred to as "Purchasers" and each individually as a
"Purchaser").
Recitals
Whereas, the Company has authorized the sale and issuance of an aggregate
of three million three hundred sixty-three thousand (3,363,000) shares of its
Series C Preferred Stock (the "Shares") and the sale and issuance of Convertible
Promissory Notes in the aggregate principle amount of nine million nine hundred
ninety-nine thousand nine hundred ninety-nine dollars and eighty-nine cents
($9,999,999.89) and convertible into eight hundred forty thousand seven hundred
fifty shares (840,750) shares of the Shares in substantially the form attached
hereto as Exhibit B (each a "Note" and collectively the "Notes");
Whereas, Purchasers desire to purchase the Shares and/or the Notes on the
terms and conditions set forth herein; and
Whereas, the Company desires to issue and sell the Shares and the Notes to
Purchasers on the terms and conditions set forth herein;
Now, Therefore, in consideration of the foregoing recitals and the mutual
promises hereinafter set forth, the parties hereto agree as follows:
1. Agreement To Sell And Purchase.
1.1 Authorization of Shares. On or prior to the Closing (as defined
in Section 2 below), the Company shall have authorized (a) the sale and issuance
to Purchasers of the Shares; (b) the issuance of such shares of Common Stock to
be issued upon conversion of the Shares (the "Conversion Shares") and; (c) the
issuance of such shares of Preferred Stock to be issued upon conversion of the
Notes. The Shares and the Conversion Shares shall have the rights, preferences,
privileges and restrictions set forth in the Amended and Restated Certificate of
Incorporation of the Company, in the form attached hereto as Exhibit C (the
"Restated Charter"). The shares of Series C Preferred Stock issued upon
conversion of the Notes shall be deemed "Shares" for all purposes under this
Agreement.
1.2 Sale and Purchase. Subject to the terms and conditions hereof, at
the Closing (as defined in Section 2 below) the Company hereby agrees to issue
and sell to each Purchaser, severally and not jointly, and each Purchaser agrees
to purchase from the Company, severally and not jointly, the number of Shares
set forth opposite such Purchaser's name on Exhibit A, at a purchase price of
eleven dollars and eighty-nine and four thousand one hundred
1.
forty-two ten-thousands cents ($11.894142) per share and the Note in the
principal amount, if any, specified for such Purchaser on Exhibit A.
2. Closing, Delivery And Payment.
2.1 Closing. The closing of the sale and purchase of the Shares and
the Notes under this Agreement (the "Closing") shall take place at 5:00 p.m. on
the date hereof, at the offices of Xxxxxx Godward LLP, 0000 Xxxxxxxx Xxxxx,
Xxxxxxxx, XX 00000 or at such other time or place as the Company and Purchasers
may mutually agree (such date is hereinafter referred to as the "Closing Date").
2.2 Delivery. At the Closing, subject to the terms and conditions
hereof, the Company will deliver to each Purchaser a certificate representing
the number of Shares and, if applicable, the Note to be purchased at the Closing
by such Purchaser, against payment of the purchase price therefor by check, wire
transfer made payable to the order of the Company, cancellation of indebtedness
or any combination of the foregoing.
2.3 Subsequent Sales of Shares. At any time on or before February
29, 2000, the Company may sell up to the balance of the authorized shares of
Series C Preferred Stock not sold at the Closing to such persons as may be
approved by the Board of Directors of the Company. All such sales shall be made
on the terms and conditions set forth in this Agreement, including, without
limitation, the representations and warranties by such Purchasers as set forth
in Section 4. Any Shares of Series C Preferred Stock sold pursuant to this
Section 2.3 shall be deemed to be "Shares" for all purposes under this Agreement
and any purchasers thereof shall be deemed to be "Purchasers" for all purposes
under this Agreement.
3. Representations And Warranties Of The Company.
Except as set forth on a Schedule of Exceptions delivered by the
Company to the Purchasers at the Closing, the Company hereby represents and
warrants to each Purchaser as of the date of this Agreement as follows:
3.1 Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
this Agreement, the Amended and Restated Investor Rights Agreement in the form
attached hereto as Exhibit D (the "Investor Rights Agreement"), the Amended and
Restated Co-Sale Agreement in the form attached hereto as Exhibit E (the "Co-
Sale Agreement") and the Amended and Restated Voting Agreement in the form
attached hereto as Exhibit F (the "Voting Agreement') (collectively, the
"Related Agreements"), to issue and sell the Shares and the Conversion Shares,
and to carry out the provisions of this Agreement, the Related Agreements and
the Restated Charter and to carry on its business as presently conducted and as
presently proposed to be conducted. The Company is duly qualified and is
authorized to do business and is in good standing as a foreign corporation in
all jurisdictions in which the nature of its activities and of its properties
(both owned and leased)
2.
makes such qualification necessary, except for those jurisdictions in which
failure to do so would not have a material adverse effect on the Company or its
business.
3.2 Subsidiaries.The Company does not own or control any equity
security or other interest of any other corporation, limited partnership or
other business entity. The Company is not a participant in any joint venture,
partnership or similar arrangement.
3.3 Capitalization; Voting Rights. The authorized capital stock of
the Company, immediately prior to the Closing, will consist of 40,000,000 shares
of Common Stock, (par value $0.001 per share), 4,059,701 shares of which are
issued and outstanding and 30,000,000 shares of Preferred Stock (par value
$0.001 per share), 14,000,000 of which are designated Series A Preferred Stock,
all of which are issued and outstanding, 12,000,000 of which are designated
Series B Preferred Stock, 11,200,000 shares of which are issued and outstanding,
and 4,000,000 shares of Series C Preferred Stock, none of which are issued and
outstanding. All issued and outstanding shares of the Company's Common Stock and
Preferred Stock (a) have been duly authorized and validly issued, and (b) are
fully paid and non-assessable. The rights, preferences, privileges and
restrictions of the Shares are as stated in the Restated Charter. Each series of
Preferred Stock is convertible into Common Stock on a one-for-one basis. The
Conversion Shares have been duly and validly reserved for issuance. Other than
the 7,400,000 shares reserved for issuance under the Company's 1999 Equity
Incentive Plan, and except as may be granted pursuant to the Related Agreements,
there are no outstanding options, warrants, rights (including conversion or
preemptive rights and rights of first refusal), proxy or shareholder agreements,
or agreements of any kind for the purchase or acquisition from the Company of
any of its securities. Of such reserved shares of Common Stock, (i) 3,029,701
shares have been issued pursuant to the exercise of options, (ii) options to
purchase 3,118,594 shares have been granted and are currently outstanding, and
(iii) 1,664,205 shares of Common Stock remain available for issuance to
officers, directors, employees and consultants pursuant to such Equity Incentive
Plan. When issued in compliance with the provisions of this Agreement and the
Restated Charter, the Shares and the Conversion Shares will be validly issued,
fully paid and non-assessable, and will be free of any liens or encumbrances;
provided, however, that the Shares and the Conversion Shares may be subject to
restrictions on transfer under state and/or federal securities laws as set forth
herein or as otherwise required by such laws at the time a transfer is proposed.
3.4 Authorization; Binding Obligations. All corporate action on the
part of the Company, its officers, directors and shareholders necessary for the
authorization of this Agreement and the Related Agreements, the performance of
all obligations of the Company hereunder and thereunder at the Closing and the
authorization, sale, issuance and delivery of the Shares pursuant hereto, the
Notes pursuant hereto and the Conversion Shares pursuant to the Notes and the
Restated Charter has been taken or will be taken prior to the Closing. The
Agreement, the Notes and the Related Agreements, when executed and delivered,
will be valid and binding obligations of the Company enforceable in accordance
with their terms, except (a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors' rights, (b) general principles of equity that restrict
the availability of equitable remedies, and (c) to the extent that the
enforceability of the indemnification provisions in Section 2.9 of the Investor
Rights Agreement may be limited by
3.
applicable laws. The sale of the Shares and the Notes and the subsequent
conversion of the Shares and the Notes into Conversion Shares are not and will
not be subject to any preemptive rights or rights of first refusal that have not
been properly waived or complied with.
3.5 Financial Statements. The Company has made available to each
Purchaser its unaudited balance sheet as at December 31, 1999 (the "Statement
Date") and unaudited consolidated statement of income and cash flows for the
eight month period ending on the Statement Date (collectively, the "Financial
Statements"), copies of which were delivered by the Company to the Purchasers
prior to the Closing. The Financial Statements, together with the notes thereto
have been prepared in accordance with generally accepted accounting principles
applied on a consistent basis throughout the periods indicated, except as
disclosed therein, and present fairly the financial condition and position of
the Company as of the Statement Date; provided, however, that the unaudited
financial statements are subject to normal recurring year-end audit adjustments
(which are not expected to be material), and do not contain all footnotes
required under generally accepted accounting principles.
3.6 Liabilities. The Company has no material liabilities and, to the
best of its knowledge, knows of no material contingent liabilities not disclosed
in the Financial Statements, except current liabilities incurred in the ordinary
course of business subsequent to the Statement Date which have not been, either
in any individual case or in the aggregate, materially adverse.
3.7 Agreements; Action.
(a) Except for agreements explicitly contemplated hereby and
agreements between the Company and its employees with respect to the sale of the
Company's Common Stock, there are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, affiliates
or any affiliate thereof.
(b) There are no agreements, understandings, instruments,
contracts, proposed transactions, judgments, orders, writs or decrees to which
the Company is a party or to its knowledge by which it is bound which may
involve (i) obligations (contingent or otherwise) of, or payments to, the
Company in excess of $100,000 (other than obligations of, or payments to, the
Company arising from purchase or sale agreements entered into in the ordinary
course of business), or (ii) the transfer or license of any patent, copyright,
trade secret or other proprietary right to or from the Company (other than
licenses arising from the purchase of "off the shelf" or other standard
products), or (iii) indemnification by the Company with respect to infringements
of proprietary rights (other than indemnification obligations arising from
purchase, sale or license agreements entered into in the ordinary course of
business).
(c) The Company has not (i) declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) incurred any indebtedness for money borrowed or any
other liabilities (other than with respect to dividend obligations,
distributions, indebtedness and other obligations incurred in the ordinary
course of business or as disclosed in the Financial Statements) individually in
excess of $100,000 or, in the case of indebtedness and/or liabilities
individually less than $100,000, in excess of $200,000 in the aggregate, (iii)
made any loans or advances to any person, other than ordinary
4.
advances for travel expenses, or (iv) sold, exchanged or otherwise disposed of
any of its assets or rights, other than the sale of its inventory in the
ordinary course of business.
(d) For the purposes of subsections (b) and (c) above, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including persons
or entities the Company has reason to believe are affiliated therewith) shall be
aggregated for the purpose of meeting the individual minimum dollar amounts of
such subsections.
3.8 Obligations to Related Parties. There are no obligations of the
Company to officers, directors, greater than 5% shareholders, or employees of
the Company other than (a) for payment of salary for services rendered, (b)
reimbursement for reasonable expenses incurred on behalf of the Company and (c)
for other standard employee benefits made generally available to all employees
(including stock option agreements outstanding under any stock option plan
approved by the Board of Directors of the Company). None of the officers,
directors or greater than 5% shareholders of the Company, or any members of
their immediate families, are indebted to the Company or have any direct or
indirect ownership interest in any firm or corporation with which the Company is
affiliated or with which the Company has a business relationship, or any firm or
corporation which competes with the Company, except that officers, directors
and/or greater than 5% shareholders of the Company may own stock in publicly
traded companies which may compete with the Company. No officer, director or
greater than 5% shareholder, or any member of their immediate families, is,
directly or indirectly, interested in any material contract with the Company
(other than such contracts as relate to any such person's ownership of capital
stock or other securities of the Company). Except as may be disclosed in the
Financial Statements, the Company is not a guarantor or indemnitor of any
indebtedness of any other person, firm or corporation.
3.9 Changes. Since the Statement Date, there has not been:
(a) Any change in the assets, liabilities, financial condition
or operations of the Company from that reflected in the Financial Statements,
other than changes in the ordinary course of business, none of which
individually or in the aggregate has had or is expected to have a material
adverse effect on such assets, liabilities, financial condition, operations or
prospects of the Company;
(b) Any resignation or termination of any officer or key
employee of the Company; and the Company, to the best of its knowledge, does not
know of the impending resignation or termination of employment of any such
officer or key employee;
(c) Any material change, except in the ordinary course of
business, in the contingent obligations of the Company by way of guaranty,
endorsement, indemnity, warranty or otherwise;
(d) Any damage, destruction or loss, whether or not covered by
insurance, materially and adversely affecting the properties, business or
prospects or financial condition of the Company;
5.
(e) Any waiver by the Company of a valuable right or of a
material debt owed to it;
(f) Any direct or indirect loans made by the Company to any
shareholder, employee, officer or director of the Company, other than advances
made in the ordinary course of business;
(g) Any material change in any compensation arrangement or
agreement with any employee, officer, director or shareholder;
(h) Any declaration or payment of any dividend or other
distribution of the assets of the Company;
(i) Any labor organization activity;
(j) Any debt, obligation or liability incurred, assumed or
guaranteed by the Company, except those for immaterial amounts and for current
liabilities incurred in the ordinary course of business;
(k) Any sale, assignment or transfer of any patents, trademarks,
copyrights, trade secrets or other intangible assets;
(l) Any change in any material agreement to which the Company is
a party or by which it is bound which materially and adversely affects the
business, assets, liabilities, financial condition, operations or prospects of
the Company;
(m) Any other event or condition of any character that, either
individually or cumulatively, has materially and adversely affected the
business, assets, liabilities, financial condition, operations or prospects of
the Company; or
(n) Any arrangement or commitment by the Company to do any of
the acts described in subsection (a) through (m) above.
3.10 Title to Properties and Assets; Liens, Etc. The Company has good
and marketable title to its properties and assets, including the properties and
assets reflected in the most recent balance sheet included in the Financial
Statements, and good title to its leasehold estates, in each case subject to no
mortgage, pledge, lien, lease, encumbrance or charge, other than (a) those
resulting from taxes which have not yet become delinquent, (b) minor liens and
encumbrances which do not materially detract from the value of the property
subject thereto or materially impair the operations of the Company, and (c)
those that have otherwise arisen in the ordinary course of business. All
facilities, machinery, equipment, fixtures, vehicles and other properties owned,
leased or used by the Company are in good operating condition and repair and are
reasonably fit and usable for the purposes for which they are being used. The
Company is in compliance with all material terms of each lease to which it is a
party or is otherwise bound.
3.11 Patents and Trademarks. To the best of its knowledge, the Company
owns or possesses sufficient legal rights to all patents, trademarks, service
marks, trade names,
6.
copyrights, trade secrets, licenses, information and other proprietary rights
and processes necessary for its business as now conducted and as presently
proposed to be conducted, without any known infringement of the rights of
others. There are no outstanding options, licenses or agreements of any kind
relating to the foregoing, nor is the Company bound by or a party to any
options, licenses or agreements of any kind with respect to the patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes of any other person or
entity other than such licenses or agreements arising from the purchase of "off
the shelf" or standard products. The Company has not received any communications
alleging that the Company has violated or, by conducting its business as
presently proposed, would violate any of the patents, trademarks, service marks,
trade names, copyrights or trade secrets or other proprietary rights of any
other person or entity. The Company is not aware that any of its employees is
obligated under any contract (including licenses, covenants or commitments of
any nature) or other agreement, or subject to any judgment, decree or order of
any court or administrative agency, that would interfere with their duties to
the Company or that would conflict with the Company's business as presently
proposed to be conducted. Neither the execution nor delivery of this Agreement
or the Related Agreements, nor the carrying on of the Company's business by the
employees of the Company, nor the conduct of the Company's business as presently
proposed, will, to the Company's knowledge, conflict with or result in a breach
of the terms, conditions or provisions of, or constitute a default under, any
contract, covenant or instrument under which any employee is now obligated. The
Company does not believe it is or will be necessary to utilize any inventions,
trade secrets or proprietary information of any of its employees made prior to
their employment by the Company, except for inventions, trade secrets or
proprietary information that have been assigned to the Company.
3.12 Compliance with Other Instruments. The Company is not in
violation or default of any term of its Restated Charter or Bylaws, or, to the
Company's knowledge, of any provision of any mortgage, indenture, contract,
agreement, instrument or contract to which it is party or by which it is bound
or of any judgment, decree, order, or writ. The execution, delivery, and
performance of and compliance with this Agreement, the Notes and the Related
Agreements, and the issuance and sale of the Shares pursuant hereto and of the
Conversion Shares and the Notes pursuant to the Notes and Restated Charter, will
not, with or without the passage of time or giving of notice, result in any such
material violation, or be in conflict with or constitute a default under any
such term, or result in the creation of any mortgage, pledge, lien, encumbrance
or charge upon any of the properties or assets of the Company or the suspension,
revocation, impairment, forfeiture or non-renewal of any permit, license,
authorization or approval applicable to the Company, its business or operations
or any of its assets or properties.
3.13 Litigation. There is no action, suit, proceeding or
investigation pending or to the Company's knowledge currently threatened in
writing against the Company that questions the validity of this Agreement, the
Notes or the Related Agreements or the right of the Company to enter into any of
such agreements, or to consummate the transactions contemplated hereby or
thereby, or which might result, either individually or in the aggregate, in any
material adverse change in the assets, condition, affairs or prospects of the
Company, financially or otherwise, or any change in the current equity ownership
of the Company, nor is the Company aware that there is any basis for any of the
foregoing. The foregoing includes, without limitation, actions pending or
threatened in writing (or any basis therefor known to the Company) involving the
prior
7.
employment of any of the Company's employees, their use in connection with the
Company's business of any information or techniques allegedly proprietary to any
of their former employers, or their obligations under any agreements with prior
employers. The Company is not a party or subject to the provisions of any order,
writ, injunction, judgment or decree of any court or government agency or
instrumentality. There is no action, suit, proceeding or investigation by the
Company currently pending or which the Company intends to initiate.
3.14 Tax Returns and Payments. The Company has filed all tax returns
(federal, state and local) required to be filed by it. All taxes shown to be
due and payable on such returns, any assessments imposed, and all other taxes
due and payable by the Company on or before the Closing, have been paid or will
be paid prior to the time they become delinquent. The Company has not been
advised (a) that any of its returns, federal, state or other, have been or are
being audited as of the date hereof, or (b) of any deficiency in assessment or
proposed judgment to its federal, state or other taxes. The Company has no
knowledge of any liability for any tax to be imposed upon its properties or
assets as of the date of this Agreement that is not adequately provided for.
3.15 Employees. The Company has no collective bargaining agreements
with any of its employees. There is no labor union organizing activity pending
or, to the Company's knowledge, threatened with respect to the Company. To the
Company's knowledge, no employee of the Company, nor any consultant with whom
the Company has contracted, is in violation of any term of any employment
contract, proprietary information agreement or any other agreement relating to
the right of any such individual to be employed by, or to contract with, the
Company because of the nature of the business to be conducted by the Company;
and to the Company's knowledge the continued employment by the Company of its
present employees, and the performance of the Company's contracts with its
independent contractors, will not result in any such violation. The Company has
not received any notice alleging that any such violation has occurred. No
employee of the Company has been granted the right to continued employment by
the Company or to any material compensation following termination of employment
with the Company. The Company is not aware that any officer or key employee, or
that any group of key employees, intends to terminate his, her or their
employment with the Company, nor does the Company have a present intention to
terminate the employment of any officer, key employee or group of key employees.
3.16 Proprietary Information and Inventions Agreements. Each
employee, officer and consultant of the Company has executed a Proprietary
Information and Inventions Agreement in the form of Exhibit G attached hereto.
No current employee, officer or consultant of the Company has excluded works or
inventions made prior to his or her employment with the Company from his or her
assignment of inventions pursuant to such employee, officer or consultant's
Proprietary Information and Inventions Agreement.
3.17 Registration Rights and Voting Rights.
(a) Except as required pursuant to the Investor Rights
Agreement, the Company is presently not under any obligation, and has not
granted any rights, to register (as
8.
defined in Section 1.1 of the Investor Rights Agreement) any of the Company's
presently outstanding securities or any of its securities that may hereafter be
issued.
(b) Except as provided for in the Voting Agreement, to the
Company's knowledge, no shareholder of the Company has entered into any
agreement with respect to the voting of equity securities of the Company.
3.18 Compliance with Laws; Permits. To its knowledge, the Company is
not in violation of any applicable statute, rule, regulation, order or
restriction of any domestic or foreign government or any instrumentality or
agency thereof in respect of the conduct of its business or the ownership of its
properties which violation would materially and adversely affect the business,
assets, liabilities, financial condition, operations or prospects of the
Company. No governmental orders, permissions, consents, approvals or
authorizations are required to be obtained and no registrations or declarations
are required to be filed in connection with the execution and delivery of this
Agreement and the issuance of the Shares, the Notes or the Conversion Shares,
except such as has been duly and validly obtained or filed, or with respect to
any filings that must be made after the Closing, as will be filed in a timely
manner. The Company has all franchises, permits, licenses and any similar
authority necessary for the conduct of its business as now being conducted by
it, the lack of which could materially and adversely affect the business,
properties, prospects or financial condition of the Company and believes it can
obtain, without undue burden or expense, any similar authority for the conduct
of its business as planned to be conducted.
3.19 Offering Valid. Assuming the accuracy of the representations
and warranties of the Purchasers contained in Section 4.2 hereof, the offer,
sale and issuance of the Shares, the Notes and the Conversion Shares will be
exempt from the registration requirements of the Securities Act of 1933, as
amended (the "Securities Act"), and will have been registered or qualified (or
are exempt from registration and qualification) under the registration, permit
or qualification requirements of all applicable state securities laws. Neither
the Company nor any agent on its behalf has solicited or will solicit any offers
to sell or has offered to sell or will offer to sell all or any part of the
Shares or the Notes to any person or persons so as to bring the sale of such
Shares by the Company within the registration provisions of the Securities Act
or any state securities laws.
3.20 Full Disclosure. The Company has provided the Purchasers with
all information requested by the Purchasers in connection with their decision to
purchase the Shares and/or the Notes, including all information the Company
believes is reasonably necessary to make such investment decision. To the
Company's knowledge, neither this Agreement, the Exhibits hereto, the Related
Agreements nor any other document delivered by the Company to Purchasers or
their attorneys or agents in connection herewith or therewith or with the
transactions contemplated hereby or thereby, contain any untrue statement of a
material fact nor, to the Company's knowledge, omit to state a material fact
necessary in order to make the statements contained herein or therein not
misleading.
3.21 Insurance. The Company has fire and casualty insurance policies
with coverage customary for companies similarly situated to the Company.
9.
4. Representations And Warranties Of The Purchasers.
Each Purchaser hereby represents and warrants to the Company as
follows (such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 Requisite Power and Authority. Purchaser has all necessary power
and authority under all applicable provisions of law to execute and deliver this
Agreement, the Notes (if applicable) and the Related Agreements and to carry out
their provisions. All action on Purchaser's part required for the lawful
execution and delivery of this Agreement, the Notes (if applicable) and the
Related Agreements have been or will be effectively taken prior to the Closing.
Upon their execution and delivery, this Agreement, the Notes (if applicable) and
the Related Agreements will be valid and binding obligations of Purchaser,
enforceable in accordance with their terms, except (a) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other laws of general
application affecting enforcement of creditors' rights, (b) general principles
of equity that restrict the availability of equitable remedies, and (c) to the
extent that the enforceability of the indemnification provisions of Section 2.9
of the Investor Rights Agreement may be limited by applicable laws.
4.2 Investment Representations. Purchaser understands that neither
the Shares, the Notes nor the Conversion Shares have been registered under the
Securities Act. Purchaser also understands that the Shares and the Notes are
being offered and sold pursuant to an exemption from registration contained in
the Securities Act based in part upon Purchaser's representations contained in
this Agreement. Purchaser hereby represents and warrants as follows:
(a) Purchaser Bears Economic Risk. Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Purchaser must bear the economic risk of
this investment indefinitely unless the Shares (or the Notes or the Conversion
Shares) are registered pursuant to the Securities Act, or an exemption from
registration is available. Purchaser understands that the Company has no present
intention of registering the Shares, the Notes, the Conversion Shares or any
shares of its Common Stock. Purchaser also understands that there is no
assurance that any exemption from registration under the Securities Act will be
available and that, even if available, such exemption may not allow Purchaser to
transfer all or any portion of the Shares, the Notes or the Conversion Shares
under the circumstances, in the amounts or at the times Purchaser might propose.
(b) Acquisition for Own Account. Purchaser is acquiring the
Shares, the Notes (if applicable) and the Conversion Shares for Purchaser's own
account for investment only, and not with a view towards their distribution.
(c) Purchaser Can Protect Its Interest. Purchaser represents
that by reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement,
10.
and the Related Agreements. Further, Purchaser is aware of no publication of any
advertisement in connection with the transactions contemplated in the Agreement.
(d) Accredited Investor. Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(e) Company Information. Purchaser has received and read the
Financial Statements and has had an opportunity to discuss the Company's
business, management and financial affairs with directors, officers and
management of the Company and has had the opportunity to review the Company's
operations and facilities. Purchaser has also had the opportunity to ask
questions of and receive answers from, the Company and its management regarding
the terms and conditions of this investment.
(f) Rule 144. Purchaser acknowledges and agrees that the Shares,
the Notes and, if issued, the Conversion Shares must be held indefinitely unless
they are subsequently registered under the Securities Act or an exemption from
such registration is available. Purchaser has been advised or is aware of the
provisions of Rule 144 promulgated under the Securities Act as in effect from
time to time, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things: the availability of certain current public information about the
Company, the resale occurring following the required holding period under Rule
144 and the number of shares being sold during any three-month period not
exceeding specified limitations.
(g) Residence. If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its investment decision was made is located at
the address or addresses of the Purchaser set forth on Exhibit A.
4.3 Transfer Restrictions. Each Purchaser acknowledges and agrees
that the Shares and, if issued, the Conversion Shares are subject to
restrictions on transfer as set forth in the Investor Rights Agreement.
5. Conditions To Closing.
5.1 Conditions to Purchasers' Obligations at the Closing. Purchasers'
obligations to purchase the Shares and/or the Notes at the Closing are subject
to the satisfaction, at or prior to the Closing Date, of the following
conditions:
(a) Representations and Warranties True; Performance of
Obligations. The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing Date
with the same force and effect as if they had been made as of the Closing Date,
and the Company shall have performed all obligations and conditions herein
required to be performed or observed by it on or prior to the Closing.
11.
(b) Consents, Permits, and Waivers. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the Related
Agreements (except for such as may be properly obtained subsequent to the
Closing).
(c) Filing of Restated Charter. The Restated Charter shall have
been filed with the Secretary of State of the State of Delaware and shall
continue to be in full force and effect as of the Closing Date.
(d) Corporate Documents. The Company shall have delivered to
Purchasers or their counsel, copies of all corporate documents of the Company as
Purchasers shall reasonably request.
(e) Reservation of Conversion Shares. The Conversion Shares
issuable upon conversion of the Shares and the Notes shall have been duly
authorized and reserved for issuance upon such conversion.
(f) Compliance Certificate. The Company shall have delivered to
Purchasers a Compliance Certificate, executed by the President of the Company,
dated the Closing Date, to the effect that the conditions specified in
subsections (a), (b), (c) and (e) of this Section 5.1 have been satisfied.
(g) Investor Rights Agreement. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit D shall have been executed
and delivered by the parties thereto.
(h) Co-Sale Agreement. The Co-Sale Agreement substantially in
the form attached hereto as Exhibit E shall have been executed and delivered by
the parties thereto. The stock certificates representing the shares subject to
the Co-Sale Agreement shall have been delivered to the Secretary of the Company
and shall have had appropriate legends placed upon them to reflect the
restrictions on transfer set forth on the Co-Sale Agreement.
(i) Board of Directors. Upon the Closing, the authorized size of
the Board of Directors of the Company shall be six members and the Board shall
consist of Xxxx Xxxxx, Xxxxxxx Xxxxx, Xxx Nova, Xxxxx Xxxxx Xxxxxxxx, Xxx Xxx
Xxxx, and Xxxxx Xxxxxxx.
(j) Voting Agreement. The Voting Agreement substantially in the
form attached hereto as Exhibit F shall have been executed and delivered by the
parties thereto.
(k) Legal Opinion. The Purchasers shall have received from legal
counsel to the Company an opinion addressed to them, dated as of the Closing
Date, in substantially the form attached hereto as Exhibit H.
(l) Proceedings and Documents. All corporate and other
proceedings in connection with the transactions contemplated at the Closing
hereby and all documents and instruments incident to such transactions shall be
reasonably satisfactory in
12.
substance and form to the Purchasers and their special counsel, and the
Purchasers and their special counsel shall have received all such counterpart
originals or certified or other copies of such documents as they may reasonably
request.
5.2 Conditions to Obligations of the Company. The Company's
obligation to issue and sell the Shares and the Notes at each Closing is subject
to the satisfaction, on or prior to such Closing, of the following conditions:
(a) Representations and Warranties True. The representations and
warranties in Section 4 made by those Purchasers acquiring Shares and the Notes
hereof shall be true and correct in all material respects at the date of the
Closing, with the same force and effect as if they had been made on and as of
said date.
(b) Performance of Obligations. Such Purchasers shall have
performed and complied with all agreements and conditions herein required to be
performed or complied with by such Purchasers on or before the Closing.
(c) Filing of Restated Charter. The Restated Charter shall have
been filed with the Secretary of State of the State of Delaware.
(d) Investor Rights Agreement. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit D shall have been executed
and delivered by the Purchasers.
(e) Co-Sale Agreement. The Co-Sale Agreement substantially in
the form attached hereto as Exhibit E shall have been executed and delivered by
the parties thereto.
(f) Voting Agreement. The Voting Agreement substantially in the
form attached hereto as Exhibit F shall have been executed and delivered by the
parties thereto.
(g) Consents, Permits, and Waivers. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the Related
Agreements (except for such as may be properly obtained subsequent to the
Closing).
6. Miscellaneous.
6.1 Governing Law. This Agreement shall be governed in all respects
by the laws of the State of Washington as such laws are applied to agreements
between Washington residents entered into and performed entirely in Washington.
6.2 Survival. The representations, warranties, covenants and
agreements made herein shall survive any investigation made by any Purchaser and
the closing of the transactions contemplated hereby. All statements as to
factual matters contained in any certificate or other instrument delivered by or
on behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
13.
6.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of the Shares from time to time.
6.4 Entire Agreement. This Agreement, the Exhibits and Schedules
hereto, the Related Agreements and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
6.5 Severability. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 Amendment and Waiver.
(a) This Agreement may be amended or modified only upon the
written consent of the Company and holders of at least a majority of the Shares
(treated as if converted and including any Conversion Shares into which the
Shares have been converted that have not been sold to the public).
(b) The obligations of the Company and the rights of the holders
of the Shares and the Conversion Shares under the Agreement may be waived only
with the written consent of the holders of at least a majority of the Shares
(treated as if converted and including any Conversion Shares into which the
Shares have been converted that have not been sold to the public).
(c) Notwithstanding the foregoing, this Agreement may be amended
with only the written consent of the Company to include additional purchasers of
the Shares at subsequent sales pursuant to Section 2.3.
6.7 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement, the Related
Agreements or the Restated Charter, shall impair any such right, power or
remedy, nor shall it be construed to be a waiver of any such breach, default or
noncompliance, or any acquiescence therein, or of or in any similar breach,
default or noncompliance thereafter occurring. It is further agreed that any
waiver, permit, consent or approval of any kind or character on any Purchaser's
part of any breach, default or noncompliance under this Agreement, the Related
Agreements or under the Restated Charter or any waiver on such party's part of
any provisions or conditions of the Agreement, the Related Agreements, or the
Restated Charter must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, the Related Agreements, the Restated Charter, by law, or otherwise
afforded to any party, shall be cumulative and not alternative.
14.
6.8 Waiver of Conflicts. Each party to this Agreement acknowledges
that Xxxxxx Godward LLP ("Xxxxxx Godward"), outside general counsel to the
Company, has in the past performed and is or may now or in the future represent
one or more of the Purchasers or their affiliates in matters unrelated to the
transactions contemplated by this Agreement (the "Financing"), including
representation of such Purchasers or their affiliates in matters of a similar
nature to the Financing. The applicable rules of professional conduct require
that Xxxxxx Godward inform the parties hereunder of this representation and
obtain their consent. Xxxxxx Godward has served as outside general counsel to
the Company and has negotiated the terms of the Financing solely on behalf of
the Company. It is the belief of Xxxxxx Godward that these terms and conditions
represent an arm's length transaction between the Company and the Purchasers.
Purchasers have been represented by independent legal counsel regarding the
terms of the Financing. The Company and each Purchaser hereby (a) acknowledge
that they have had an opportunity to ask for and have obtained information
relevant to such representation, including disclosure of the reasonably
foreseeable adverse consequences of such representation; (b) acknowledge that
with respect to the Financing, Xxxxxx Godward has represented solely the
Company, and not any Purchaser or any stockholder, director or employee of the
Company or any Purchaser; and (c) gives its informed consent to Xxxxxx Godward's
representation the Company in the Financing.
6.9 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day, (c) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (d) one (1) day after deposit with
a nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address set forth on Exhibit A attached hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
6.10 Expenses. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement. The Company shall, at the Closing, reimburse the reasonable fees
of and expenses of one special counsel for the Purchasers, not to exceed
$15,000, incurred in connection with the negotiation, execution, delivery and
performance of this Agreement.
6.11 Attorneys' Fees. In the event that any suit or action is
instituted to enforce any provision in this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all fees, costs
and expenses of enforcing any right of such prevailing party under or with
respect to this Agreement, including without limitation, such reasonable fees
and expenses of attorneys and accountants, which shall include, without
limitation, all fees, costs and expenses of appeals.
6.12 Titles and Subtitles. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
15.
6.13 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
6.14 Broker's Fees. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 6.14 being untrue.
6.15 Exculpation Among Purchasers. Each Purchaser acknowledges that it
is not relying upon any person, firm, or corporation, other than the Company and
its officers and directors, in making its investment or decision to invest in
the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable to any other Purchaser for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the
Shares and Conversion Shares.
6.16 Confidentiality. Each party hereto agrees that, except with the
prior written consent of the other party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any
confidential information, knowledge or data concerning or relating to the
business or financial affairs of the other parties to which such party has been
or shall become privy by reason of this Agreement or the Related Agreements,
discussions or negotiations relating to this Agreement or the Related
Agreements, the performance of its obligations hereunder or the ownership of the
Shares purchased hereunder. The provisions of this Section 6.16 shall be in
addition to, and not in substitution for, the provisions of any separate
nondisclosure agreement executed by the parties hereto.
6.17 Pronouns. All pronouns contained herein, and any variations
thereof, shall be deemed to refer to the masculine, feminine or neutral,
singular or plural, as to the identity of the parties hereto may require.
6.18 California Corporate Securities Law. THE SALE OF THE SECURITIES
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR
PRIOR TO SUCH QUALIFICATION OR IN THE ABSENCE OF AN EXEMPTION FROM SUCH
QUALIFICATION IS UNLAWFUL. PRIOR TO ACCEPTANCE OF SUCH CONSIDERATION BY THE
COMPANY, THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED
UPON SUCH QUALIFICATION BEING OBTAINED OR AN EXEMPTION FROM SUCH QUALIFICATION
BEING AVAILABLE.
[The Remainder Of This Page Intentionally Left Blank]
16.
In Witness Whereof, the parties hereto have executed the Series C Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.
COMPANY:
Mercata, Inc.
By: /s/ Xxx Xxx Xxxx
-----------------------
Xxx Xxx Xxxx
President
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S)
Vulcan Ventures Incorporated
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Xxxxxxx X. Xxxxx
Vice President
/s/ Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx
/s/ Xxxx Xxxxx
--------------------------------
Xxxx Xxxxx
/s/ Xxxxx Xxxxxxx
--------------------------------
Xxxxx Xxxxxxx
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S):
Highland Capital Partners IV Limited Partnership
By: Highland Management Partners IV LLC
Its: General Partner
By: /s/ Xxxxxx Nova
-------------------------------------------
Member
Highland Entrepreneurs' Fund IV Limited Partnership
By: Highland Management Partners IV LLC
Its: General Partner
By: /s/ Xxxxxx Nova
-------------------------------------------
Member
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S):
Amerindo Technology Growth Fund II, Inc.
By: /s/ Xxxx X. Xxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxx
--------------------------------------
Title: Director
-------------------------------------
Vertex Capital II LLC
By: /s/ [ILLEGIBLE]
----------------------------------------
Name:______________________________________
Title:_____________________________________
Vertex Capital III LLC
By: /s/ [ILLEGIBLE]
----------------------------------------
Name:______________________________________
Title:_____________________________________
Sands Brothers/Amerindo Technology Associates LLC
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxx
--------------------------------------
Title: Manager
-------------------------------------
Sands Brothers / Technology Associates
Institution LLC
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxx
--------------------------------------
Title: Manager
-------------------------------------
Sands Brothers/Amerindo Technology Offshore
Associates LLC
By: /s/ Xxxxxx X. Xxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxx
--------------------------------------
Title: Manager
-------------------------------------
Xxxxxx Master Trust
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
By: /s/ Xxxxxxx Xxxxxx-Xxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxx-Xxxxxxx
--------------------------------
Title: Attorney-in-Fact
-------------------------------
/s/ Xxxxx Xxxxxxxxxx
-------------------------------------
Xxxxx Xxxxxxxxxx
Aurora Technology Fund LLC
By: /s/ [ILLEGIBLE]
----------------------------------
Name:________________________________
Title:_______________________________
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S):
Global Retail Partners, L.P.
By: Global Retail Partners, Inc.
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
DLJ Diversified Partners, L.P.
By: DLJ Diversified Partners, Inc.
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
DLJ Diversified Partners-A, L.P.
By: DLJ Diversified Partners, Inc.
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
GRP Partners, L.P.
By: Global Retail Partners, Inc.
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
Global Retail Partners Funding, Inc.
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
DLJ ESC II, L.P.
By: DLJ LBO Plans Management Corporation
Its: General Partner
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
------------------------------------
Title: Vice President
-----------------------------------
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S):
Waelinvest
By: /s/ Xxxxxx Xx Xxxxx
---------------------------------
Name: Xxxxxx Xx Xxxxx
-------------------------------
Title:Chief Executive Officer
------------------------------
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
INVESTOR(S):
TWP Mercata Investors
By: /s/ Xxxxx Xxxxxx
-----------------------------
Xxxxx X. Xxxxxx
Managing Partner
SIGNATURE PAGE TO SERIES C PREFERRED
STOCK PURCHASE AGREEMENT
EXhibit A
SCHEDULE OF PURCHASERS
Aggregate Share
Name And Address Shares Purchase Price
Vulcan Ventures Incorporated 573,145 $ 6,817,068.02
110 - 000/xx/ Xxxxxx X.X., Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Highland Capital Partners IV Limited Partnership 587,261 $ 6,984,965.73
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Highland Entrepreneurs' Fund IV Limited Partnership 24,469 $ 291,037.76
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Amerindo Technology Growth Fund II, Inc. 252,500 $ 3,003,270.86
c/o Amerindo Investment Advisors
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Vertex Capital II LLC 26,600 $ 316,384.18
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxxxx
Vertex Capital III LLC 8,400 $ 99,910.79
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxxxx
Sands Brothers / Amerindo 42,000 $ 499,553.96
Technology Associates LLC
c/o Amerindo Investment Advisors
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Sands Brothers/Technology Associates Institution LLC 42,000 $ 499,533.96
c/o Amerindo Investment Advisors
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Aggregate Share
SCHEDULE A - SCHEDULE OF PURCHASES
1.
Aggregate Share
Name and Address Shares Purchase Price
Sands Brothers/Amerindo 42,000 $ 499,553.96
Technology Offshore Associates LLC
c/o Amerindo Investment Advisors
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Xxxxxx Master Trust 89,125 $ 1,060,065.41
c/o Amerindo Investment Advisors
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxxxxxx 2,000 $ 23,788.28
c/o Amerindo Investment Advisors
00 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx X0X 0XX
Aurora Technology Fund LLC 84,104 $ 1,000,344.92
000 Xxxx 00/xx/ Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Global Retail Partners, L.P. 156,967 $ 1,866,987.79
0000 Xxxxxx xx xxx Xxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
with copy to:
Global Retail Partners, L.P.
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
SCHEDULE A - SCHEDULE OF PURCHASES
2.
Aggregate Share
Name and Address Shares Purchase Price
DLJ Diversified Partners, L.P. 46,774 $ 556,336.60
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
with copy to:
DLJ Diversified Partners, L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxx
DLJ Diversified Partners - A, L.P. 17,369 $ 206,589.35
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
with copy to:
DLJ Diversified Partners - A, L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxx
GRP Partners, L.P. 10,205 $ 121,379.72
0000 Xxxxxx xx xxx Xxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
with copy to:
GRP Partners, L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
Global Retail Partners Funding, Inc. 10,809 $ 128,563.78
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx
with copy to:
Global Retail Partners Funding, Inc.
2121 Avenue of the Stars, 00/xx/ Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
SCHEDULE A - SCHEDULE OF PURCHASES
3.
Aggregate Share
Name and Address Shares Purchase Price
DLJ ESC II L.P. 2,702 $ 32,137.97
000 Xxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Attention: Xx Xxxxxxx
with copy to:
DLJ ESC II L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxx
Waelinvest 420,375* $ 4,999,999.94*
000 xxx Xxxxxxx
0000 Xxxxxxxxx
Xxxxxxx
with copy to:
000 Xxxxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
TWP Mercata Investors 56,120 $ 667,499.25
c/o Thomas Xxxxxx Partners
0 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Xxxxxxx X. Xxxxx 21,019 $ 250,002.97
110 - 000/xx/ Xxxxxx XX, Xxxxx 000
Xxxxxxxx, XX 00000-0000
Xxxxx X. Xxxxxxx 2,102 $ 25,001.49
110 - 000/xx/ Xxxxxx XX, Xxxxx 000
Xxxxxxxx, XX 00000-0000
Xxxx Xxxxx 4,204 $ 50,002.97
110 - 000/xx/ Xxxxxx XX, Xxxxx 000
Xxxxxxxx, XX 00000-0000
Total 2,522,250 $29,999,999.66
========= ==============
Total (including the Notes and assuming
conversion of the Notes 3,363,000 $39,999,999.55
========= ==============
_________________
* Waelinvest will also be purchasing Notes in the amount of $9,999,999.89 that
will be convertible into 840,750 shares of the Shares.
SCHEDULE A - SCHEDULE OF PURCHASES
4.
Exhibit B
FORM OF CONVERTIBLE PROMISSORY NOTE
Exhibit C
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION
Exhibit D
AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
Exhibit E
AMENDED AND RESTATED CO-SALE AGREEMENT
Exhibit F
AMENDED AND RESTATED VOTING AGREEMENT
Exhibit G
PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
Exhibit H
FORM OF LEGAL OPINION
