EXHIBIT 1
NEITHER THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON THE
EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). SUCH SECURITIES HAVE BEEN ACQUIRED
FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FOR THE
SECURITIES UNDER THE SECURITIES ACT, UNLESS THE HOLDER HEREOF SHALL HAVE
DELIVERED TO THE ISSUER A WRITTEN OPINION OF COUNSEL, IN FORM, SUBSTANCE
AND SCOPE REASONABLY ACCEPTABLE TO THE ISSUER, TO THE EFFECT THAT SUCH
SECURITIES ARE BEING OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT;
PROVIDED, HOWEVER, THAT SUCH OPINION OF COUNSEL WILL NOT BE REQUIRED BY THE
COMPANY FOR ANY DISPOSITIONS MADE BY THE HOLDER (1) TO ANY OF ITS
AFFILIATES (AS SUCH TERM IS DEFINED IN RULE 405 PROMULGATED UNDER THE
SECURITIES ACT) OR (2) PURSUANT TO RULE 144 PROMULGATED UNDER THE
SECURITIES ACT, PROVIDED THAT PRIOR TO SUCH DISPOSITION THE COMPANY
RECEIVES FROM THE HOLDER AND THE RELEVANT BROKER, IF APPLICABLE, SUCH
CERTIFICATIONS AS ARE NECESSARY FOR THE COMPANY TO CONFIRM THAT SUCH
DISPOSITION IS EXEMPT FROM REGISTRATION PURSUANT TO RULE 144 OR OTHERWISE,
AS THE CASE MAY BE. FURTHERMORE, THIS WARRANT MAY ONLY BE SOLD, TRANSFERRED
OR ASSIGNED TO AN AFFILIATE OF HEWLETT-PACKARD COMPANY.
NOVADIGM, INC.
WARRANT TO PURCHASE COMMON STOCK
Warrant Number: 1
Number of Shares: 250,000 Shares of Common Stock
(subject to adjustment as provided herein)
Original Date of Issuance: June 30, 2000
FOR VALUE RECEIVED, Hewlett-Packard Company, the registered holder hereof
or its permitted assigns ("HOLDER"), is entitled, subject to the terms set
forth below, to purchase from Novadigm, Inc., a Delaware corporation (the
"COMPANY"), upon surrender of this Warrant, at any time or times on or
after the date hereof, but not after 5:00 P.M., Pacific Time, on the date
three years from the commencement of the Milestone Period (as hereinafter
defined) (the "EXPIRATION DATE") Two Hundred Fifty Thousand (250,000) fully
paid and nonassessable shares of common stock, $0.001 par value per share
(the "COMMON STOCK"), of the Company (the "WARRANT SHARES") at the exercise
price per Warrant Share equal to $20.875, subject to adjustment as set
forth herein (the "EXERCISE Price"). This Warrant is issued pursuant to the
terms of the Alliance Agreement (the "ALLIANCE AGREEMENT"), dated as of
June 30, 2000, between the Company and Hewlett-Packard Company ("HP").
Section 1. Exercise Price.
(a) If, during the Milestone Period (as hereinafter
defined), the Company receives an aggregate of $15,000,000 (the "LICENSE
REVENUES MILESTONE") in license revenues (which revenues shall not include
any revenues from fees charged by the Company for installation,
maintenance, support or other services or training of, or with respect to,
the licensed products) as a result of the reference-selling by HP of
licenses to use the Company's products pursuant to Section 5.6 of the
Alliance Agreement (which reference-selling is documented pursuant to
Section 6.3(c) of the Alliance Agreement), then the Exercise Price shall be
reduced to $0; provided, however, that license revenues received by the
Company from existing customers of HP referred directly to the Company by
HP (and not through reference-selling by HP pursuant to Section 5.6 of the
Alliance Agreement) during the period from the date hereof to the date on
which Milestone Period begins, shall be credited to the License Revenues
Milestone. For purposes hereof, the "MILESTONE PERIOD" means the period
beginning on the date as of which the Company has employed two (2) of the
five (5) pairs of sales representatives and technical consultants it is
required to employ pursuant to Section 3.2 of the Alliance Agreement and
ending twelve (12) months thereafter. The Company shall promptly notify HP
in writing of the commencement of the Milestone Period.
(b) Within thirty (30) days of the end of the Milestone
Period, the Company shall deliver to HP written notice of whether the
License Revenues Milestone has been met. In the event that the Company
determines that the License Revenues Milestone has not been met and HP
disagrees with such determination, HP shall deliver written notice to the
Company, within thirty (30) days of the date of the Company's notice, that
it intends to conduct an audit of the records maintained by the Company
pursuant to Section 5.2(d) of the Alliance Agreement. Thereafter, HP shall
select an independent certified public accounting firm (the "HP ACCOUNTING
Firm"), and the Company shall allow the HP Accounting Firm, at HP's sole
expense, to inspect such records and make a determination, within thirty
(30) days of the date of HP's notice, of whether the License Revenues
Milestone has been met. In the event that the HP Accounting Firm determines
that the License Revenues Milestone has been met, the Company and HP shall
select a mutually agreeable independent public accounting firm (which
accounting firm shall not be the HP Accounting Firm or an accounting firm
which conducts audits of the financial statements of the Company or HP)
(the "INDEPENDENT ACCOUNTING FIRM"), and the Company shall allow the
Independent Accounting Firm, with the expenses thereof shared equally by
the Company and HP, to inspect such records and make a determination,
within thirty (30) days of the date of the determination by the HP
Accounting Firm, of whether the License Revenues Milestone has been met.
The determination of the Independent Accounting Firm shall be final and
binding on the Company and HP. The HP Accounting Firm and the Independent
Accounting Firm shall be bound in confidence not to disclose any
information except to the extent necessary to inform the Company and HP of
whether the License Revenues Milestone has been met.
Section 2. Exercise of Warrant.
(a) Subject to the terms and conditions hereof, this
Warrant may be exercised by Holder, in whole or in part, during normal
business hours on any business day on or after the date hereof and prior to
5:00 P.M., Pacific Time, on the Expiration Date by (i) delivery to the
Company of a duly executed written notice, in the form of the subscription
notice attached as Exhibit A hereto (the "EXERCISE NOTICE"), of such
Holder's election to exercise this Warrant, which Exercise Notice shall
specify the number of Warrant Shares to be purchased, (ii) payment to the
Company of an amount equal to the Exercise Price, if any, multiplied by the
number of Warrant Shares as to which the Warrant is being exercised (the
"AGGREGATE EXERCISE PRICE") in cash or by check or wire transfer of
immediately available funds and (iii) delivery to the Company of this
Warrant.
(b) In lieu of making the cash payment equal to the
Aggregate Exercise Price otherwise contemplated to be made to the Company
in Section 2(a), Holder may elect to instead receive upon its exercise of
this Warrant the net number of Warrant Shares computed using the following
formula:
X = Y (A-B)
--------
A
where
X = the net number of Warrant Shares to be
issued to Holder under said formula.
Y = the number of Warrant Shares
otherwise issuable to Holder pursuant
to its exercise of this Warrant.
A = the last reported sale price on the
Nasdaq National Market, or such other
national securities exchange or market
on which the Common Stock is then
listed, of a share of Common Stock on
the date immediately preceding the date
of the Exercise Notice.
B = the Exercise Price in effect at the
time of exercise.
(c) In the event of any exercise of the rights
represented by this Warrant in compliance with Section 2, a certificate or
certificates for the Warrant Shares so purchased, in such denominations as
may be requested by Holder and registered in the name of Holder, shall be
delivered at the Company's expense to such Holder as soon as reasonably
practicable, and in no event later than ten (10) business days, after the
Company's receipt of the Exercise Notice, the Aggregate Exercise Price, if
any, and this Warrant. Upon exercise, in whole or in part, of this Warrant
in accordance with Section 2, Holder shall be deemed for all corporate
purposes to have become holder of record of the Warrant Shares with respect
to which the Warrant has been exercised immediately prior to the close of
business on the date on which Holder is deemed to have exercised the
Warrant in accordance with Section 2, irrespective of the date of delivery
of certificates evidencing such Warrant Shares.
(d) Unless the rights represented by this Warrant shall
have expired or shall have been fully exercised, the Company shall, as soon
as reasonably practicable and in no event later than ten (10) business days
after any exercise and at its own expense, issue a new Warrant
substantially identical to the Warrant exercised, except it shall represent
rights to purchase the number of Warrant Shares purchasable immediately
prior to such exercise under the Warrant exercised, less the number of
Warrant Shares with respect to which such Warrant is exercised.
(e) No fractional shares of Common Stock are to be issued
upon the exercise of this Warrant, but rather the number of shares of
Common Stock issued upon exercise of this Warrant shall be rounded up to
the nearest whole number.
Section 3. Covenants as to Common Stock. The Company hereby
covenants and agrees as follows:
(a) During the period within which the rights represented
by this Warrant may be exercised, the Company will at all times have
authorized and reserved, solely for issuance and delivery upon exercise of
this Warrant, such number of shares of Common Stock then issuable upon the
exercise of this Warrant.
(b) Prior to exercise of this Warrant, the Company shall
secure the listing of the Warrant Shares upon each national securities
exchange or market, if any, upon which shares of Common Stock are then
listed (subject to official notice of issuance upon exercise of this
Warrant) and shall maintain, so long as any other shares of Common Stock
shall be so listed, such listing of the Warrant Shares; and the Company
shall list on each national securities exchange or market, and shall
maintain such listing of, any other shares of capital stock of the Company
issuable upon the exercise of this Warrant if and so long as any shares of
the same class shall be listed on such national securities exchange or
market.
(c) The Company will take such actions as may be
necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable shares of Common Stock upon the exercise
of this Warrant.
(d) All Warrant Shares that may be issued upon the
exercise of rights represented by this Warrant and payment of the Exercise
Price, if any, all as set forth herein, will be free from all taxes, liens,
security interests, charges and other encumbrances or restrictions on sale
created by the Company, and free and clear of all preemptive rights granted
by the Company or arising under Delaware corporate law. The Company agrees
that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to
execute and issue the necessary certificates for shares of Common Stock
upon the exercise of this Warrant.
Section 4. Taxes. The Company shall pay any and all transfer or
stamp taxes or other similar governmental charges which may be payable with
respect to the issuance and delivery of Warrant Shares upon exercise of
this Warrant.
Section 5. Holder Not Deemed a Stockholder. This Warrant shall not
entitle Holder to vote or receive dividends or to any other rights of a
stockholder of the Company, including, without limitation, the right to
vote, give or withhold consent to any corporate action (whether a
reorganization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise). In addition, nothing contained in this
Warrant shall be construed as imposing any liabilities on Holder to
purchase any securities (upon exercise of this Warrant or otherwise) or as
a stockholder of the Company, whether such liabilities are asserted by the
Company or by creditors of the Company.
Section 6. Representations of Holder. Holder, by the acceptance
hereof, represents that Holder (a) has received such documents, materials
and information as Holder deems necessary or appropriate for evaluation of
the Warrant and the Warrant Shares, (b) has such knowledge and experience
in financial and business matters that it is capable of evaluating the
merits and risks of its investment in the Warrant and the Warrant Shares,
(c) is an "accredited investor" as such term is defined in Rule 501
promulgated under the Securities Act of 1933, as amended (the "SECURITIES
ACT"), and (d) is acquiring the Warrant and the Warrant Shares solely for
its own account, for investment and not with a view to the distribution or
resale thereof.
Section 7. Ownership and Transfer.
(a) The Company shall maintain at its principal executive
offices (or such other office or agency of the Company as it may designate
by notice to Holder), a register for this Warrant, in which the Company
shall record the name and address of the Person in whose name this Warrant
has been issued, as well as the name and address of each permitted
transferee. The Company may treat the Person in whose name any Warrant is
registered on the register as the owner and holder thereof for all
purposes, but in all events recognizing any transfers made in accordance
with the terms of this Warrant. "PERSON" means an individual, partnership,
corporation, limited liability company, association, joint stock company,
trust, joint venture, unincorporated organization or other entity, or a
governmental entity or any department, agency or political subdivision
thereof.
(b) This Warrant and the rights granted to Holder are
transferable, in whole or in part, upon surrender of this Warrant, together
with a properly executed warrant power in the form of Exhibit B attached
hereto, only to an Affiliate of HP; provided, however, that any transfer or
assignment shall be subject to the conditions set forth in Sections 6(c)
and (d) below. For purposes of this Warrant, "AFFILIATE" shall have such
meaning as is ascribed to it in Rule 405 promulgated under the Securities
Act.
(c) Holder represents and warrants that it understands
that, except as set forth in the Stockholder Rights Agreement dated as of
June 30, 2000 by and between the Company and HP (the "STOCKHOLDER RIGHTS
AGREEMENT"), the Company is under no obligation to register this Warrant or
the Warrant Shares under the Securities Act and that the Warrant and
Warrant Shares will be characterized as "restricted securities" under the
Securities Act because they are being acquired from the Company in a
transaction not involving a public offering. Holder also represents and
warrants that it understands that neither the Warrant nor the Warrant
Shares may be offered for sale, sold, assigned or transferred unless (a)
subsequently registered pursuant to an effective registration statement
under the Securities Act, or (b) such Holder shall have delivered to the
Company a written opinion of counsel, in form, substance and scope
reasonably acceptable to the Company, to the effect that the securities to
be offered for sale, sold, assigned or transferred are being offered for
sale, sold, assigned or transferred pursuant to an exemption from such
registration; provided, however, that such opinion of counsel will not be
required by the Company for any dispositions made by the Holder (i) to any
of its Affiliates or (ii) pursuant to Rule 144 promulgated under the
Securities Act, provided that prior to such disposition the Company
receives from the Holder and the relevant broker, if applicable, such
certifications as are necessary for the Company to confirm that such
disposition is exempt from registration pursuant to Rule 144 or otherwise,
as the case may be.
(d) In addition to the transfer restrictions set forth in
Section 7(c), Holder shall not sell, assign or transfer any Warrant Shares
to any Person other than an Affiliate of HP prior to the first anniversary
of the original issuance of such Warrant Shares. This transfer restriction
shall expire upon a Change in Control (as defined in Section 1.1(a) of the
Stockholder Rights Agreement) of the Company. Holder acknowledges that the
Warrant Shares are also subject to the transfer restrictions set forth in
Section 3 of in the Stockholder Rights Agreement.
(e) Any certificates representing Warrant Shares issued
in accordance with this Warrant shall bear a legend substantially in the
following form:
THE SHARES OF COMMON STOCK OF NOVADIGM, INC. (THE "COMPANY")
REPRESENTED BY THIS CERTIFICATE (THE "SHARES") HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT FOR SUCH SHARES UNDER THE SECURITIES ACT,
UNLESS HOLDER HEREOF SHALL HAVE DELIVERED TO THE COMPANY A WRITTEN
OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE REASONABLY
ACCEPTABLE TO THE COMPANY TO THE EFFECT THAT THE SHARES TO BE
OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED ARE BEING OFFERED
FOR SALE, SOLD, TRANSFERRED OR ASSIGNED PURSUANT TO AN EXEMPTION
FROM SUCH REGISTRATION; PROVIDED, HOWEVER, THAT SUCH OPINION OF
COUNSEL WILL NOT BE REQUIRED BY THE COMPANY FOR ANY DISPOSITIONS
MADE BY THE HOLDER (I) TO ANY OF ITS AFFILIATES (AS SUCH TERM IS
DEFINED IN RULE 405 PROMULGATED UNDER THE SECURITIES ACT OR (II)
PURSUANT TO RULE 144 PROMULGATED UNDER THE SECURITIES ACT,
PROVIDED THAT PRIOR TO SUCH DISPOSITION THE COMPANY RECEIVES FROM
THE HOLDER AND THE RELEVANT BROKER, IF APPLICABLE, SUCH
CERTIFICATIONS AS ARE NECESSARY FOR THE COMPANY TO CONFIRM THAT
SUCH DISPOSITION IS EXEMPT FROM REGISTRATION PURSUANT TO RULE 144
OR OTHERWISE, AS THE CASE MAY BE. FURTHERMORE, THE SHARES (A) MAY
NOT BE SOLD, ASSIGNED OR TRANSFERRED PRIOR TO THE FIRST
ANNIVERSARY OF THE COMPANY'S ORIGINAL ISSUANCE OF SUCH SHARES AND
(B) ARE SUBJECT TO THE TRANSFER RESTRICTIONS SET FORTH IN THE
STOCKHOLDER RIGHTS AGREEMENT DATED AS OF JUNE 30, 2000 BY AND
BETWEEN THE COMPANY AND HEWLETT-PACKARD COMPANY (THE "STOCKHOLDER
RIGHTS AGREEMENT"). THE TRANSFER RESTRICTION DESCRIBED IN CLAUSE
(A) OF THE FOREGOING SENTENCE SHALL EXPIRE UPON A CHANGE OF
CONTROL OF THE COMPANY (AS DEFINED IN THE STOCKHOLDER RIGHTS
AGREEMENT).
Section 8. Adjustment of Exercise Price and Number of Warrant
Shares. The Exercise Price and the number of Warrant Shares issuable upon
exercise of this Warrant shall be adjusted from time to time as follows:
(a) Subdivision or Combination of Shares. If the Company
at any time effects a subdivision or combination of the outstanding Common
Stock (through a stock split, reverse stock split or otherwise), the
Exercise Price in effect immediately prior to such event shall be decreased
and the number of Warrant Shares shall be increased, in the case of a
subdivision, or the Exercise Price in effect immediately prior to such
event shall be increased and the number of Warrant Shares shall be
decreased, in the case of a combination, in the same proportions as the
Common Stock is subdivided or combined, in each case effective
automatically upon, and simultaneously with, the effectiveness of the
subdivision or combination which gives rise to the adjustment.
(b) Stock Dividends. If the Company at any time pays a
dividend, or makes any other distribution, to holders of Common Stock
payable in shares of Common Stock, or fixes a record date for the
determination of holders of Common Stock entitled to receive a dividend or
other distribution payable in shares of Common Stock, the Exercise Price
shall be decreased by multiplying it by a fraction:
(i) the numerator of which shall be the total
number of shares of Common Stock outstanding immediately prior to
such dividend or distribution (the "PRIOR OUTSTANDING SHARES"),
and
(ii) the denominator of which shall be the total
number of shares of Common Stock outstanding immediately after such
dividend or distribution (plus, if the Company paid cash instead of
fractional shares otherwise issuable in such dividend or
distribution, the number of additional shares which would have been
outstanding had the Company issued fractional shares instead of
cash) (the "SUBSEQUENT OUTSTANDING SHARES"),
and the number of Warrant Shares shall be increased by multiplying it by a
fraction, the numerator of which shall be the Subsequent Outstanding Shares
and the denominator of which shall be the Prior Outstanding Shares, in each
case effective automatically as of the date of the effectiveness of such
dividend or distribution.
(c) Reclassification, Consolidation or Merger. If at any
time, as a result of:
(i) a capital reorganization or reclassification
(other than a subdivision, combination or dividend
provided for elsewhere in this Section 8), or
(ii) a merger or consolidation of the Company
with another corporation (whether or not the Company is
the surviving corporation),
the Common Stock issuable upon exercise of this Warrant shall be changed
into or exchanged for the same or a different number of shares of any class
or classes of stock of the Company or any other corporation, or other
securities convertible into such shares, then, as a part of such
reorganization, reclassification, merger or consolidation, appropriate
adjustments shall be made in the terms of this Warrant (or of any
securities into which this Warrant is exercised or for which this Warrant
is exchanged), so that Holder of this Warrant or of such substitute
securities shall thereafter be entitled to receive, upon exercise of this
Warrant or of such substitute securities, the kind and amount of shares of
stock, other securities, money and property which such Holder would have
received at the time of such capital reorganization, reclassification,
merger, or consolidation, if such Holder had exercised this Warrant
immediately prior to such capital reorganization, reclassification, merger,
or consolidation. This Warrant, including, without limitation, the
provisions of this Section 8(c), will be binding upon any entity succeeding
to the Company by merger, consolidation or acquisition of all or
substantially all of the Company's assets. The provisions of this Section
8(c) shall similarly apply to (x) successive capital reorganizations,
reclassifications, mergers and consolidations and (y) the securities of any
other corporation that are at the time receivable upon the exercise of this
Warrant.
(d) Certain Events And No Impairment. If any event occurs
of the type contemplated by the provisions of this Section 8, but not
expressly provided for by such provisions, then the Company's Board of
Directors will make an appropriate adjustment in the Exercise Price and the
number of Warrant Shares obtainable upon exercise of this Warrant so as to
protect the rights of Holder.
(e) Certificate as to Adjustments. Upon the occurrence of
each adjustment or readjustment pursuant to this Section 8, the Company at
its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and furnish to each Holder of this Warrant
a certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based. The
Company shall, upon the written request, at any time, of any such Holder,
furnish or cause to be furnished to such Holder a like certificate setting
forth: (i) such adjustments and readjustments; (ii) the Exercise Price at
the time in effect; and (iii) the number of Warrant Shares and the amount,
if any, of other property that at the time would be received upon the
exercise of the Warrant.
Section 9. Lost, Stolen, Mutilated or Destroyed Warrant. If this
Warrant is lost, stolen, mutilated or destroyed, the Company shall, on
receipt of evidence reasonably satisfactory to the Company of the ownership
of, and the loss, theft, mutilation or destruction of, this Warrant and of
an indemnity reasonably satisfactory to the Company (and in the case of
mutilation, upon surrender and cancellation of this Warrant), issue in lieu
thereof a new Warrant of like denomination and tenor as the Warrant so
lost, stolen, mutilated or destroyed.
Section 10. Notice. Any notices required, permitted or desired to
be given under the terms of this Warrant shall be delivered personally,
sent by overnight courier or mailed, registered or certified mail, return
receipt requested to the following addresses, and shall be deemed to have
been received on the day of personal delivery, one business day after
deposit with a nationally recognized overnight courier or five business
days after deposit in the mail:
If to the Company:
Novadigm, Inc.
Xxx Xxxxxxxxxxxxx Xxxx.
Xxxxx 000
Xxxxxx, Xxx Xxxxxx 00000
Attention: Albion X. Xxxxxxxxxx
Xxxxxx X. Xxxxxxxx
With a copy to:
Xxxxxx Xxxxxx Xxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
If to Holder:
Hewlett-Packard Company
0000 Xxxxxxx Xxxxxx, XX 20 BQ
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
With copies to:
Hewlett-Packard Company
0000 Xxxxxxx Xxxxxx, XX 20 BT
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: C.D. Portfolio
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Esq.
or at such other address as any party may specify in a written notice given
to the other party hereto, including upon the transfer of this Warrant.
Section 11. Notices of Record Date. In the event:
(a) the Company shall take a record of holders of its
Common Stock (or other stock or securities at the time receivable upon the
exercise of this Warrant), for the purpose of entitling them to receive any
dividend or other distribution; or
(b) of any consolidation or merger of the Company with or
into another corporation, any capital reorganization of the Company, any
reclassification of the capital stock of the Company, or any conveyance of
all or substantially all of the assets of the Company to another
corporation in which holders of the Company's stock are to receive stock,
securities or property of another corporation; or
(c) of any voluntary dissolution, liquidation or
winding-up of the Company; or
(d) of the occurrence of any event of the type
contemplated by the provisions of Section 8, but not expressly provided for
by such provisions,
then, and in each such case, the Company will mail or cause to be mailed to
Holder a notice specifying, as the case may be, (i) the date on which a
record is to be taken for the purpose of such dividend or distribution,
(ii) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding-up
is to take place, or (iii) the date on which such occurrence of any event
of the type contemplated by the provisions of Section 8, but not expressly
provided for by such provisions, is to take place, and the time, if any is
to be fixed, as of which holders of record of Common Stock (or such stock
or securities as at the time are receivable upon the exercise of this
Warrant) shall be entitled to exchange their shares of Common Stock (or
such other stock or securities) for securities or other property
deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation, winding-up or other event.
Such notice shall be delivered at least fifteen (15) days prior to the date
therein specified.
Section 12. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged, or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver,
discharge or termination is sought. The headings in this Warrant are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof. This Warrant shall be governed by and interpreted under the
laws of the State of Delaware. This Warrant, in all events, shall be wholly
void and of no effect after 5:00 p.m., Pacific time, on the Expiration
Date, except that, notwithstanding any other provisions hereof, the
provisions of Section 7 shall continue in full force and effect after such
date as to any Warrant Shares or other securities issued upon the exercise
of this Warrant.
Section 13. Successors and Assigns. The terms and provisions of
this Warrant shall inure to the benefit of, and be binding upon, the
Company and the Holder and their respective successors and permitted
assigns.
EXHIBIT A TO WARRANT
SUBSCRIPTION FORM
TO BE EXECUTED BY HOLDER TO EXERCISE THIS WARRANT
NOVADIGM, INC.
The undersigned holder hereby irrevocably exercises the right to
purchase ___________ of the shares of Common Stock ("WARRANT SHARES") of
Novadigm, Inc., a Delaware corporation (the "COMPANY"), evidenced by the
attached Warrant (the "WARRANT") and (check the applicable box):
? Tenders herewith payment of the Aggregate Exercise Price, if any,
in full in the form of cash or a check or wire transfer in
immediately available funds in the amount of $__________ for
__________ Warrant Shares.
? Elects the net issue exercise option pursuant to Section 2(b) of
the Warrant with respect to __________ Warrant Shares, and
accordingly requests delivery of a net of __________ Warrant
Shares according to the following calculation:
X = Y (A-B) ( ____) = ( ____) [( ______)-- ( ____)]
------- ________________________
A ( ------ )
X = the net number of Warrant Shares to be issued to
Holder under said formula.
Y = the number of Warrant Shares otherwise
issuable to Holder pursuant to its exercise of
this Warrant.
A = the last reported sale price on the Nasdaq
National Market, or such other national
securities exchange or market on which the
Common Stock is then listed, of a share of
Common Stock on the date immediately preceding
the date of this Exercise Notice.
B = the Exercise Price in effect at the time
of exercise.
Date: _______________ ___, ______
Name of Holder
Signature:
Name:
Title:
Address:____ ________________________________
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.
EXHIBIT B TO WARRANT
FORM OF WARRANT POWER
FOR VALUE RECEIVED, the undersigned does hereby assign and
transfer to _____________________, Federal Identification No.
_________________________, a warrant to purchase ___________________
shares of the Common Stock of Novadigm, Inc., a Delaware corporation,
represented by warrant certificate no. , standing in the name of the
undersigned on the books of said corporation. The undersigned does hereby
irrevocably constitute and appoint ______________, attorney to transfer
the warrants of said corporation, with full power of substitution in the
premises.
Dated: _______________________, 200__
---------------------------
By:
Name:
Title:
