EXHIBIT 10.16
NEITHER THIS WARRANT NOR ANY OF THE SECURITIES ISSUABLE HEREUNDER
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), AND AS SUCH MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED, PLEDGED OR HYPOTHECTED EXCEPT PURSUANT TO A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO SUCH WARRANT OR SECURITIES,
OR DELIVERY OF AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY THAT SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECTATION
IS IN COMPLIANCE WITH THE ACT OR UNLESS SOLD IN FULL COMPLIANCE WITH
RULE 144 PROMULGATED UNDER THE ACT.
INTERTRUST TECHNOLOGIES CORPORATION
Class A Common Stock Warrant
September 7, 1999
THIS CERTIFIES THAT for value received, and subject to the provisions and
upon the terms and conditions hereinafter set forth, Xxxxx & Company
Incorporated (the "Holder") is entitled to subscribe for and purchase shares
(the "Shares") of Class A Common Stock of InterTrust Technologies Corporation, a
Delaware corporation (the "Company"), at a price per share equal to fourteen
dollars ($14.00) (the "Warrant Price"). The term "Grant Date" shall mean the
date set forth above.
1. Voluntary Exercise. This Warrant may be exercised for up to fifty percent
------------------
(50%) of the Shares in full or in part at any time (or from time to time) after
the one-year anniversary of the Grant Date and as to all or part of the balance
of the Shares in full or in part at any time (or from time to time) after the
two-year anniversary of the Grant Date (each, an "Exercise Date") at a per
share price equal to the Warrant Price; provided, however, that this Warrant
may, at the Holder's discretion, be exercised in full as to all the Shares prior
to the Exercise Dates immediately prior to the closing of (a) a sale of all or
substantially all of the Company's assets or (b) the merger or consolidation of
the Company with another corporation whereby the Company's stockholders
immediately prior to such merger or consolidation will hold less than 50% of the
outstanding securities of the surviving corporation immediately following such
merger or consolidation (such sale, merger or consolidation shall be referred to
herein as a "Sale of the Company"). The Company will provide reasonable prior
written notice of the closing of a Sale of the Company to the Holder as the
Company is required to provide to Holders of Class A Common Stock under
applicable law. Without limiting the forgoing, upon the notice described in the
immediately preceding sentence, the Holder may transfer the Warrant to a third
party, subject to the prior written approval of the Company, not to be
unreasonably withheld (such approval may be reasonably withheld where such third
party has a material adverse interest, or is directly competitive, with the
Company or any other entity that is a party to the Sale of the Company);
provided that such third party transferee will be subject to the voluntary
exercise provision of the first sentence of this Section 1 and the termination
provisions of Section 2 and other terms of this Warrant.
2. Termination. Notwithstanding paragraph 1 above, this Warrant shall
-----------
terminate and be of no further force and effect upon the earlier of: (i) the
five (5) year anniversary of the Grant Date; and (ii) at the sole discretion of
the Company upon the closing of a Sale of the Company. Notwithstanding the
representations, warranties and terms hereof, this issuance and exercise of this
Warrant shall be subject to the Securities Act of 1933, as amended and the rules
and regulations promulgated thereunder. The Company shall have the right to
take, and shall have no liability resulting from, such actions as deemed
necessary by the SEC in connection with the issuance and exercise of this
Warrant.
3. Number of Shares. Subject to the terms and conditions hereinafter set
----------------
forth, the Holder is entitled, upon surrender of this Warrant, to purchase Three
Hundred Twenty-Five Thousand (325,000) Shares of Class A Common Stock from the
Company.
1
Method of Exercise; Net Issue Exercise.
4. --------------------------------------
(a) Method of Exercise; Payment; Issuance of New Warrant. The purchase right
-----------------------------------------------------
represented by this Warrant may be exercised by the Holder, in whole or in part,
at the election of the Holder, by the surrender of this Warrant (with the notice
of exercise form attached hereto as Exhibit A duly executed) at the principal
---------
office of the Company and by the payment to the Company, by check or wire
transfer, of an amount equal to the then applicable Warrant Price per share
multiplied by the number of Shares then being purchased. The person or persons
in whose name(s) any certificate(s) representing Shares shall be issuable upon
exercise of this Warrant shall be deemed to have become the holder(s) of record
of, and shall be treated for all purposes as the record holder(s) of, the shares
represented thereby (and such shares shall be deemed to have been issued)
immediately prior to the close of business on the date or dates upon which this
Warrant is exercised. In the event of any exercise of the rights represented by
this Warrant, certificates for the shares of stock so purchased shall be
delivered to the Holder as soon as possible and in any event within fifteen (15)
business days of receipt of such notice and, unless this Warrant has been fully
exercised or expired, a new warrant representing the portion of the Shares, if
any, with respect to which this Warrant shall not then have been exercised shall
also be issued to the Holder as soon as possible and in any event within such
fifteen (15) business day period.
(b) Net Issue Exercise. In lieu of exercising this Warrant pursuant to
------------------
subparagraph 4(a) above, the Holder may elect to receive shares equal to the
value of this Warrant (or the portion thereof being canceled) by surrender of
this Warrant at the principal office of the Company together with notice of such
election in which event the Company shall issue to the Holder a number of Shares
computed using the following formula:
X = Y(A- B)
-------
A
Where: X = The number of Shares to be issued to the Holder.
Y = the number of Shares purchasable under this Warrant (or the
portion thereof being canceled) at the time of such
exercise.
A = the fair market value of one share of Class A Common Stock
at the time of such exercise.
B = Warrant Price (as adjusted to the date of such calculation).
For purposes of this subparagraph 4(b), the fair market value of the Class A
Common Stock shall be determined as follows:
(i) if this Warrant is exercised prior to an initial
public offering of the Company's Common Stock (an "IPO"), the fair market value
of the Class A Common Stock shall be determined in good faith by the Company's
Board of Directors;
(ii) if the exercise is in connection with the IPO, and
if the Company's registration statement relating to such public offering has
been declared effective by the Securities and Exchange Commission ("SEC"), then
the fair market value per share shall be the initial "Price to Public" specified
in the final prospectus with respect to the offering; or
(iii) if this Warrant is exercised after, and not in
connection with, the Company's IPO, and:
(a) if traded on a securities exchange, the fair
market value shall be deemed to be the average of
the closing prices over the ten (10) day trading
period immediately preceding three days
2
before the day the current fair market value of
the securities is being determined; or
(b) if actively traded over-the-counter, the fair
market value shall be deemed to be the average of
the closing bid and asked prices quoted on the
Nasdaq system (or similar system) over the ten
(10) day trading period immediately preceding
three days before the day the current fair market
value of the securities is being determined.
5. Stock Fully Paid: Reservation of Shares. All Shares that may be
---------------------------------------
issued upon the exercise of the rights represented by this Warrant shall, upon
issuance, be fully paid and non-assessable, and free from all taxes, liens and
charges with respect to the issue thereof. During the period within which the
rights represented by the Warrant may be exercised, the Company will at all
times have authorized and reserved for the purpose of issuance upon exercise of
the purchase rights evidenced by this Warrant, a sufficient number of shares of
Class A Common Stock to provide for the exercise of the right represented by
this Warrant.
6. Adjustment of Shares. The kind of securities purchasable upon the
--------------------
exercise of the Warrant shall be subject to adjustment from time to time upon
the occurrence of certain events as follows:
(a) Reclassification. In case of any reclassification, change or
----------------
conversion of Class A Common Stock issuable upon exercise of this Warrant (other
than a change in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination), the Company
shall execute a new Warrant (in form and substance reasonably satisfactory to
the Holder, as the holder of this Warrant) providing that the Holder shall have
the right to exercise such new Warrant and upon such exercise to receive, in
lieu of each share of Class A Common Stock theretofore issuable upon exercise of
this Warrant, the kind of shares of stock, other securities, money and property
receivable upon such reclassification or change by a holder of one share of
Class A Common Stock. Such new Warrant shall provide for adjustments that shall
be as nearly equivalent as may be practicable to the adjustments provided for in
this Paragraph 6. The provisions of this subparagraph 6(a) shall similarly
apply to successive reclassifications or changes.
(b) Merger or Consolidation. Subject to Paragraphs 1 and 2 above,
-----------------------
upon a Sale of the Company or other business combination in which the Class A
Common Stock is converted or exchanged into the rights or interest of another
company, the Company, or such successor or purchasing corporation, as the case
may be, shall execute a new Warrant (in form and substance reasonably
satisfactory to the Holder) providing that the Holder shall have the right to
exercise such new warrant and upon such exercise to receive, in lieu of each
share of Class A Common Stock theretofore issuable upon exercise of this
Warrant, the kind of shares of stock, other securities, money and property
receivable upon such merger or consolidation by a holder of one share of Class A
Common Stock. Such new Warrant shall provide for adjustments that shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Paragraph 6. The provisions of this subparagraph 6(b) shall similarly apply to
successive mergers and consolidations.
(c) Stock Splits, Stock Dividends, etc.
-----------------------------------
(i) In case the Company shall (A) declare a dividend or
make a distribution on its Class A Common Stock payable in shares of its capital
stock, (B) subdivide its outstanding shares of Class A Common Stock through
stock split or otherwise, or (C) combine its outstanding shares of Class A
Common Stock into a smaller number of shares of Class A Common Stock, the number
and/or nature of Shares purchasable upon exercise of this Warrant immediately
prior thereto shall be adjusted so that the Holder shall be entitled to receive
the kind and number of Shares or other securities of the Company which he would
have owned or have been entitled to receive after the happening of any of the
events described above, had such Warrant been exercised immediately prior to the
happening of such event or any record date with respect thereto. An adjustment
made pursuant to this paragraph (c)(i) shall become effective retroactively as
of the record date of such event.
3
(ii) Extraordinary Dividends. In case the Company shall issue
-----------------------
rights, options or warrants or securities convertible into Class A Common Stock
to all the holders of its shares of Class A Common Stock generally, entitling
them (for a period expiring within forty-five (45) days after the record date
referred below in this paragraph (c)(ii)) to subscribe for or purchase shares of
Class A Common Stock at a price per share which (together with the value of the
consideration, if any, paid for such rights, options, warrants or convertible
securities) is lower on the record date referred to below than the then fair
market value per share of Class A Common Stock (as determined pursuant to
Section 4(b)) the number of Shares thereafter purchasable upon the exercise of
this Warrant shall be determined by multiplying the number of Shares immediately
theretofore purchasable upon exercise of this Warrant by a fraction, of which
the numerator shall be the number of shares of Class A Common Stock outstanding
on such record date plus the number of additional shares of Class A Common Stock
offered for subscription or purchase, and of which the denominator shall be the
number of shares of Class A Common Stock outstanding on such record date plus
the number of shares which the aggregate offering price of the total number of
shares of Class A Common Stock so offered would purchase at the then fair market
value per share of Class A Common Stock. Such adjustment shall be made whenever
such rights, options, warrants or convertible securities are issued, and shall
become effective retroactively as of the record date for the determination of
shareholders entitled to receive such rights, options, warrants or convertible
securities.
(d) In the event the Company shall declare a dividend, or make a
distribution to the holders of its Class A Common Stock generally, whether in
cash, property or assets of any kind, including any dividend payable in stock or
securities of any other issuer owned by the Company (excluding regularly payable
cash dividends declared from time to time by the Company's Board of Directors or
any dividend or distribution referred to in Section 6(c)(i) above), the Warrant
Price shall be reduced, without any further action by the parties hereto, by the
Per Share Value (as hereinafter defined) of the dividend. For purposes of this
Section 6(d), the "Per Share Value" of a cash dividend or other distribution
shall be the dollar amount of the distribution on each share of Class A Common
Stock and the "Per Share Value" of any dividend or distribution other than cash
shall be equal to the fair market value of such non-cash distribution on each
share of Class A Common Stock as determined in good faith by the Board of
Directors of the Company.
(e) Whenever the number of Shares purchasable upon the exercise of
this Warrant is adjusted, as provided in this Section 6, the Warrant Price shall
also be appropriately adjusted, if necessary, in order to protect the rights of
the Holder. In that regard, in the case of any event described in Section 6(c),
the Warrant Price shall also be appropriately adjusted by multiplying such
Warrant Price immediately prior to such adjustment by a fraction, of which the
numerator shall be the number of Shares purchasable upon the exercise of this
Warrant immediately prior to such adjustment, and of which the denominator shall
be the number of Shares so purchasable immediately thereafter.
(f) No Impairment. The Company will not, by amendment of its Restated
-------------
Certificate of Incorporation or through any reorganization, recapitalization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed hereunder by the
Company, but will at all times in good faith assist in the carrying out of all
the provisions of this Paragraph 6 and in the taking of all such action as may
be necessary or appropriate in order to protect the rights of the Holder as the
holder of this Warrant against impairment.
(g) Notices of Record Date. In the event of any taking by the Company
----------------------
of a record of its stockholders for the purpose of determining stockholders who
are entitled to receive payment of any dividend (other than a cash dividend) or
other distribution, any right to subscribe for, purchase or otherwise acquire
any share of any class or any other securities or property, or to receive any
other right, or any proposed liquidation, dissolution or winding up of the
Company, the Company shall mail to the Holder, as the holder of the Warrant, at
least twenty (20) days prior to the date specified therein, a notice specifying
the date on which any such
4
record is to be taken for the purpose of such dividend, distribution or right,
and the amount and character of such dividend, distribution or right.
7. Right of First Refusal: Restriction on Transfer.
-----------------------------------------------
(a) Grant. The Company is hereby granted the right of first
-----
refusal (the "First Refusal Right"), exercisable in connection with any proposed
transfer of the shares. For purposes of this Paragraph 7, the term "transfer"
shall include any sale, assignment, pledge, encumbrance or other disposition for
value of the shares intended to be made by the Holder; provided, however, that
the Holder may transfer any Shares to an investment fund or funds managed by
Holder or an affiliate of Holder, including officers, directors and employees of
Holder (a "Permitted Transferee"), and provided that Holder submits to the
Company an irrevocable joint and several undertaking for the benefit of the
Company executed by the Holder or an affiliate of Holder and the Permitted
Transferee(s) that Holder or an affiliate of Holder may represent the Permitted
Transferee(s) on all matters related to the Shares, without first making such an
offer to the Company.
(b) Notice of Intended Disposition. In the event the Holder
------------------------------
desires to accept a bona fide third-party offer for any or all of the shares
(the shares subject to such offer to be hereinafter called the "Target Shares"),
Holder shall promptly deliver to the Corporate Secretary of the Company written
notice (the "Disposition Notice") in accordance with this Warrant of the terms
and conditions of the offer, including the purchase price and the identity of
the third-party offeror.
(c) Exercise of Right. The Company (or its assignees) shall, for
-----------------
a period of fifteen (15) business days following receipt of the Disposition
Notice, have the right to repurchase all but not less than all of the Target
Shares specified in the Disposition Notice upon substantially the same terms and
conditions specified therein. Such right shall be exercisable by delivery of
written notice (the "Exercise Notice") in accordance with this Warrant to Holder
prior to the expiration of the fifteen (15) business day exercise period. If the
First Refusal Right is exercised with respect to the Target Shares specified in
the Disposition Notice, then the Company (or its assignees) shall effect the
repurchase of the Target Shares, including payment of the purchase price, not
more than fifteen (15) business days after delivery of the Exercise Notice; and
at such time Holder shall deliver to the Company the certificates representing
the Target Shares to be repurchased, each certificate to be properly endorsed
for transfer.
(d) Non-Exercise of Right. In the event the Exercise Notice is
---------------------
not given to Holder within fifteen (15) business days following the date of the
Company's receipt of the Disposition Notice or the Company does not complete a
purchase within fifteen (15) days after an Exercise Notice is delivered, Holder
shall have a period of forty-five (45) days thereafter in which to sell or
otherwise dispose of the Target Shares to the third-party offeror identified in
the Disposition Notice upon terms and conditions (including the purchase price)
no more favorable to such third-party offeror than those specified in the
Disposition Notice. The third-party offeror shall acquire the Target Shares
subject to the Company's First Refusal Right hereunder. In the event Holder does
not effect such sale or disposition of the Target Shares within the specified
forty-five (45) day period, the Company's First Refusal Right shall continue to
be applicable to any subsequent disposition of the Target Shares by Holder until
such right lapses in accordance with subparagraph 7(f).
(e) Restriction on Transfer. Except with the Company's prior
-----------------------
written consent, neither the Holder nor any transferee of Holder shall sell or
transfer in any manner (the "Transfer Restriction") any Shares purchased
hereunder to any person or entity engaged in, or reasonably anticipated by the
Company to become engaged in, the business of providing electronic commerce
solutions or related technology (a "Restricted Party"). The Holder or any
transferee of Holder may request that the Company waive the restriction on the
sale or transfer of Shares described in the preceding sentence to a Restricted
Party as to a particular proposed sale or transfer, but the Company shall have
no obligation to waive such restriction on the sale or transfer of any such
Shares to any Restricted Party.
5
(f) Lapse. The First Refusal Right and Transfer Restriction under
-----
this Paragraph 7 shall lapse and cease to have effect upon the closing of the
IPO.
8. Fractional Shares. No fractional shares of Class A Common Stock shall
-----------------
be issued in connection with any exercise hereunder, but in lieu of such
fractional shares the Company shall make a cash payment therefor upon the basis
of the fair market value of the Class A Common Stock then in effect.
9. Transfers and Exchanges. This Warrant or portions hereof may only be
-----------------------
transferred to a Permitted Transferee.
10. Rights as Stockholder. The Holder, as the holder of the Warrant,
---------------------
shall not be entitled to vote or receive dividends and shall not be deemed the
holder of Class A Common Stock, nor shall anything contained herein be construed
to confer upon the Holder as the holder of this Warrant, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or to receive
notice of meetings, or to receive dividends or subscription rights or otherwise
until this Warrant shall have been exercised and the shares of Class A Common
Stock purchasable upon the exercise hereof shall have become deliverable, as
provided herein.
11. Representations and Warranties of the Company. This Warrant is issued
---------------------------------------------
and delivered on the basis of the following:
(a) Due Authorization. This Warrant has been duly authorized and
-----------------
executed by the Company and when delivered will be the valid and binding
obligation of the Company enforceable in accordance with its terms.
(b) Due Issuance. The shares of Class A Common Stock purchasable
------------
upon the exercise hereof 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 non-assessable.
12. Representations and Warranties of the Holder.
--------------------------------------------
(a) Investment Intent. Holder hereby warrants and represents that
-----------------
Holder is acquiring this Warrant, and any Shares issued upon exercise of this
Warrant, for Holder's own account and not with a view to their resale or
distribution.
(b) Exempt from Registration. Holder acknowledges that this
------------------------
Warrant has not been registered under the Act on the ground that the issuance of
this Warrant is exempt from registration pursuant to Section 4(2) of the Act,
and that the Company's reliance on such exemption is predicated on the
representations of Holder set forth herein.
(c) Investment Experience. In connection with the investment
-------------------
representations made herein Holder represents that it is able to fend for itself
in the transactions contemplated by this Warrant, has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of its investment, has the ability to bear the economic risks
of its investment, and has been furnished with and has had access to such
information as it has requested and deemed appropriate to its investment
decision.
(d) Restricted Securities. Holder hereby confirms that Holder has
---------------------
been informed that this Warrant, and the Shares issued upon exercise of this
Warrant, are restricted securities under the Act and may not be resold or
transferred unless this Warrant, and the Shares issued upon exercise of this
Warrant, are first registered under the federal securities laws or unless an
exemption from such registration is available. Accordingly, Holder hereby
acknowledges that Holder is prepared to hold this Warrant, and the Shares issued
upon exercise of this Warrant, for an indefinite period and that Holder is aware
that Rule 144 of the Securities
6
and Exchange Commission issued under the Act is not presently available to
exempt the issuance of this Warrant from the registration requirements of the
Act.
(e) Disposition of Shares. Holder hereby agrees that Holder shall
---------------------
make no disposition of this Warrant and the Shares issued upon exercise of this
Warrant, unless and until:
(1) Holder shall have notified the Company of the proposed
disposition;
(2) Holder shall have complied with all requirements of this
Agreement applicable to the disposition; and
(3) Holder shall have provided the Company with written assurance, in
form and substance satisfactory to the Company, that (i) the proposed
disposition does not require registration of the Shares under the Act, or
(ii) all appropriate action necessary for compliance with the registration
requirements of the Act or of any exemption from registration available
under the Act (including Rule 144) has been taken.
(f) Restrictive Legends. In order to reflect the restrictions on
-------------------
disposition of the Shares issued upon exercise of this Warrant, the stock
certificates for the Shares will be endorsed with the following restrictive
legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THE SHARES MAY NOT BE SOLD OR OFFERED FOR SALE
IN THE ABSENCE OF (a) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES
UNDER SUCH ACT, (b) A 'NO ACTION' LETTER OF THE SECURITIES AND EXCHANGE
COMMISSION WITH RESPECT TO SUCH SALE OR OFFER, OR (c) SATISFACTORY
ASSURANCES TO INTERTRUST TECHNOLOGIES CORPORATION THAT REGISTRATION UNDER
SUCH ACT IS NOT REQURIED WITH RESPECT TO SUCH SALE OR OFFER."
(g) Market Stand-Off. Holder hereby agrees that, during the period of
----------------
duration (not to exceed 180 days) specified by the Company and an underwriter of
Common Stock or other securities of the Company, following the effective date of
the IPO, it shall not, to the extent requested by the Company and such
underwriter, directly or indirectly sell, offer to sell, contract to sell
(including, without limitation, any short sale), grant any option to purchase or
otherwise transfer or dispose of (other than to donees who agree to be similarly
bound) any securities of the Company held by it at any time during such period
except Common Stock included in such registration; provided, however, that all
offers and directors of the Company, and all other persons with registration
rights (whether or not pursuant to this Agreement) enter into similar
agreements.
13. Modification and Waiver. This Warrant and any provision hereof may be
-----------------------
changed, waived, discharged or terminated only by an instrument in writing
signed by the Company and the Holder.
14. Notices. Any notice, request or other document required or permitted
-------
to be given or delivered to the Holder or the Company shall be delivered, or
shall be sent by certified or registered mail, postage prepaid, to such Holder's
address as shown on the books of the Company or to the Company at the address
indicated on the signature page of this Warrant.
15. Successors and Assigns. The terms and provisions of this Warrant
----------------------
shall be binding upon the Company, the Holder, and their respective successors
and assigns, subject at all times to the restrictions set forth in this Warrant.
16. Lost Warrants or Stock Certificates. The Company covenants to the
-----------------------------------
holder hereof that upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction, or mutilation of this
7
Warrant or any stock certificate and, in the case of any such loss, theft or
destruction, upon receipt of any indemnity reasonably satisfactory to the
Company, or in the case of any such mutilation upon surrender and cancellation
of such Warrant or stock certificate, the Company will make and deliver a new
Warrant or stock certificate, or like tenor, in lieu of the lost, stolen,
destroyed or mutilated Warrant or stock certificate.
17. Descriptive Headings. The descriptive headings of the several
--------------------
paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant.
18. Governing Law. This Warrant shall be construed and enforced in
-------------
accordance with, and the rights of the parties shall be governed by, the laws of
the State of California, USA.
19. Entire Agreement. This Warrant and the exhibits hereto embody the
----------------
entire agreement and understanding of Holder and Company with respect to the
subject matter hereof, and supersede all prior and contemporaneous agreements
and understandings, oral or written, relative to said subject matter.
20. Attorney's Fees. If any action at law or in equity is necessary to
---------------
enforce or interpret the terms of this Warrant, the prevailing party shall be
entitled to reasonable attorney's fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
22. Registration Rights. The Company agrees that the Shares issued or
-------------------
issuable upon exercise of this Warrant shall be deemed "Registrable Securities"
as such term is defined in the Company's Series E Preferred Stock Purchase
Agreement with Holder dated July 27, 1999 (the "Series E Agreement") solely for
purposes of granting "piggyback" registration rights under subsection 4.1(c) of
the Series E Agreement and "piggyback" rights to have the Shares registered in
connection with registrations effected pursuant to subsections 4.1(b) and 4.1(h)
of the Series E Agreement; provided, however, that in the event of any cutback
of securities requested by the underwriters, the Shares shall be subject to
cutback prior to any cutbacks on any holders of Common Stock issued or issuable
upon conversion of the Company's Preferred Stock and then only on a pro rata
basis with other holders of Common Stock. The Holder shall also be entitled to
the benefits and bound by the obligations in subsection 4.1(g) of the Series E
Agreement relating to indemnification with respect to registered resales of the
Shares.
8
IN WITNESS WHEREOF, InterTrust Technologies Corporation has caused this
Warrant to be executed by its officers hereunto duly authorized effective as of
the date first above written.
INTERTRUST TECHNOLOGIES
CORPORATION
By:________________________________
Xxxxxx Xxxxx, Chairman and
Chief Executive Officer
Address: 000 Xxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
AGREED AND ACKNOWLEDGED:
XXXXX & COMPANY INCORPORATED
By:_________________________
____________________________
Please Print Name
____________________________
Title, if applicable
9
EXHIBIT A
---------
NOTICE OF EXERCISE
To: InterTrust Technologies Corporation
000 Xxxxxxx Xxxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxx, Senior Operating Officer and EVP, Corporate
Development
1. The undersigned hereby elects to purchase
___________ shares of Class A Common Stock of InterTrust
Technologies Corporation pursuant to the terms of the
attached Warrant, and tenders herewith payment of the
purchase price of such shares in full.
2. Please issue a certificate or certificates
representing said shares in the name of the undersigned or
in such other name or names as are specified below:
Name: ______________________________
Address: ______________________________
______________________________
______________________________
3. The undersigned represents that the
aforesaid shares being acquired for the account of the
undersigned are for investment and not with a view to, or
for resale in connection with, the distribution thereof and
that the undersigned has no present intention of
distributing or reselling such shares.
____________________________
Signature
_______________________
(Date)
10
