WARRANT AGREEMENT
This WARRANT AGREEMENT (this "Agreement") is made and entered into as of
the 23rd day of December, 1997 by and between CUMETRIX, Inc.. a California
corporation (the "Company"), and Troop Xxxxxxxxx Xxxxxxx & Xxxxxx, LLP
("Holder").
RECITALS
WHEREAS, the Company has retained the Holder to render professional
legal services in connection with a contemplated public offering of the
common stock (the "Offering") of the Company; and
WHEREAS, the Company desires and the Holder accepts the Warrant (as
defined below) as partial consideration for the services rendered by the
Holder in connection with the Offering.
In consideration of these premises and the mutual covenants and
agreements hereinafter set forth, and other good and valuable consideration
the receipt and sufficiency of which are hereby acknowledged, the Company and
Holder agree as follows:
1. GRANT OF WARRANT.
In consideration of the sum of $45.00 ($0.001 per Warrant), the Company
hereby grants to Holder the right and option (the "Warrant"), upon the terms
and subject to the conditions set forth in this Agreement, to purchase all or
any portion of 45,000 shares of the Common Stock no par value of the Company
(the "Warrant Shares") at an exercise price of $3.00 per share (the "Exercise
Price").
2. TERM OF WARRANT.
The Warrant shall terminate and expire at 5:00 p.m., Los Angeles time,
on December 31, 2002 (the "Warrant Expiration Date"), unless sooner
terminated as provided herein.
3. VESTING.
(a) The Warrant is immediately exercisable with respect to all
45,000 shares of Common Stock.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the Warrant may not be exercised, in whole or in part, unless and
until any then-applicable requirements of all state and federal laws and
regulatory agencies shall have been fully complied with to the satisfaction
of the Company and its counsel.
4. EXERCISE OF WARRANT.
There is no obligation to exercise the Warrant, in whole or in part. The
Warrant may be exercised, in whole or in part, only by delivery to the Company
of:
(a) written notice of exercise in form and substance identical to
Exhibit "A" attached to this Agreement stating the number of Warrant Shares then
being purchased (the "Purchased Shares"); and
(b) payment of the Exercise Price of the Purchased Shares in cash, by
check, or by wire transfer.
Upon receipt of the foregoing, the Company shall promptly issue in the name
of the Holder a stock certificate evidencing the Purchased Shares by such
exercise and deliver such certificate to the Holder.
5. RESTRICTIONS ON PURCHASED SHARES.
(a) Each certificate for Purchased Shares initially issued upon the
exercise of the Warrants, shall be stamped or otherwise imprinted with a legend
in substantially the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
THE CONDITIONS SPECIFIED IN A CERTAIN WARRANT AGREEMENT
DATED DECEMBER 23, 1997. NO TRANSFER, SALE, PLEDGE,
HYPOTHECATION, ENCUMBRANCE OR OTHER DISPOSITION OF THE
SHARES REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR
EFFECTIVE UNTIL REGISTERED OR THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL, SATISFACTORY TO IT, THAT THE TRANSACTION
IS EXEMPT FROM REGISTRATION, AND UNTIL SUCH CONDITIONS AS
ARE CONTAINED IN THE WARRANT AGREEMENT HAVE BEEN FULFILLED.
A COPY OF THE FORM OF THE WARRANT AGREEMENT IS ON FILE AT
THE OFFICES OF CUMETRIX, INC. THE HOLDER OF THIS
CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE
BOUND BY THE PROVISIONS OF THE WARRANT AGREEMENT."
If the Purchased Shares are no longer subject to the transfer restrictions
imposed by applicable state and Federal securities law because either (I) the
Purchased Shares or the resale of the Purchased Shares has been registered on a
registration statement declared effective by the Commission, or (ii) in the
reasonable opinion of counsel for the Company, or the opinion of counsel for
Holder, which opinion is reasonably satisfactory to counsel for the Company, all
future dispositions of any of the Purchased Shares by the contemplated
transferee would be exempt from or would satisfy the registration and prospectus
delivery requirements of the Securities Act and the qualification requirements
of the applicable state securities laws, then the restrictions on transfer of
such securities contained in this Section 5(a) shall not apply to any subsequent
transfer thereof and the Company shall, promptly upon request by Holder, remove
the legend set forth
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above and shall promptly issue, in exchange for the certificate bearing such
legend, a certificate without such legend to Holder.
(b) HOLDER AGREES THAT THE WARRANT MAY NOT BE TRANSFERRED, SOLD,
ASSIGNED OR HYPOTHECATED EXCEPT (I) TO ITS SUCCESSORS IN A MERGER OR
CONSOLIDATION OR OTHER BUSINESS COMBINATION; (ii) TO PURCHASERS OF ALL OR
SUBSTANTIALLY ALL OF ITS ASSETS; OR (iii) BY OPERATION OF LAW. HOLDER FURTHER
AGREES THAT THE COMPANY SHALL HAVE NO OBLIGATION TO EFFECT ANY TRANSFER OF THE
WARRANTS DURING THE TIME PERIOD REFERRED TO ABOVE, UNLESS THE TRANSFEREE,
PURCHASER, ASSIGNEE OR PLEDGEE, AS THE CASE MAY BE, SHALL HAVE EXECUTED AN
AGREEMENT OBLIGATING THE TRANSFEREE TO COMPLY WITH ALL TERMS AND CONDITIONS OF
THIS AGREEMENT APPLICABLE TO THE TRANSFEROR.
(c) Prior to any exercise of the Warrants or any transfer or
attempted transfer of any of the Warrants or Warrant Shares, the Holder shall
give the Company written notice of Holder's intention so to do, describing
briefly the manner of any such proposed exercise, sale or transfer. The Holder
may effect such exercise or transfer, provided that such exercise or transfer is
not prohibited by this Section 5 and such exercise or transfer complies with all
applicable federal and state securities laws and regulations. If in the
reasonable opinion of counsel for the Company, notwithstanding the opinion of
counsel to a Holder to the contrary, if any, the proposed transfer of such
Warrant Shares or the Warrant may not be effected without registration thereof
under the Securities Act and such registration has not been accomplished, the
Company shall, as promptly as practicable, so notify the Holder and the Holder
shall not consummate the proposed transfer.
(d) The Holder agrees to enter into a lock-up agreement with the
underwriters of the initial public offering of the Company's common stock (the
"IPO") pursuant to which Holder agrees not to sell the Warrant Shares for such
period of time from and after the effective date of such public offering as may
be requested by such underwriters; provided that the term of the lock-up
agreement shall not exceed the term of similar lock-up agreements executed in
favor of the underwriter by the senior officers of the Company.
6. ADJUSTMENTS UPON RECAPITALIZATION.
(a) In the event the Company should at any time or from time to time
after the date of this Warrant (the "Issuance Date") fix a record date for the
effectuation of a split or subdivision of the outstanding shares of Common Stock
or the determination of holders of Common Stock entitled to receive a dividend
or other distribution payable in additional shares of Common Stock or other
securities or rights convertible into, or entitling the holder thereof to
receive, directly or indirectly, additional shares of Common Stock (hereinafter
referred to as "Common Stock Equivalents") without payment of any consideration
by such holder for the additional shares of Common Stock or the Common Stock
Equivalents (including the additional shares of Common Stock issuable upon
conversion or exercise thereof), then, as of such record date (or the date of
such dividend distribution, split or subdivision if no record date is fixed),
the
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Exercise Price shall be appropriately decreased (i.e., the per share Exercise
Price shall be adjusted such that the aggregate exercise price for all
Warrant Shares issuable upon exercise of the Warrants in full, as adjusted,
shall remain the same) and the number of Warrant Shares shall be increased in
proportion to such increase in the aggregate number of shares of Common Stock
outstanding and those issuable with respect to such Common Stock Equivalents.
(b) If the number of shares of Common Stock outstanding at any
time after the Issuance Date is decreased by a combination of the outstanding
shares of Common Stock, then, following the record date of such combination,
the Exercise Price shall be appropriately increased (i.e., the per share
Exercise Price shall be adjusted such that the aggregate exercise price for
all Warrant Shares issuable upon exercise of the Warrants in full, as
adjusted, shall remain the same) and the number of Warrant Shares shall be
decreased in proportion to such decrease in the aggregate number of shares of
Common Stock outstanding and those issuable with respect to such Common Stock
Equivalents.
(c) In case of any capital reorganization, any reclassification of
the Common Stock (other than a change in par value or a recapitalization
described in Section 6(a) or 6(b) of this Agreement), or the consolidation of
the Company with, or a sale of substantially all of the assets of the Company
to (which sale is followed by a liquidation or dissolution of the Company),
or merger of the Company with, another person, the Holder shall thereafter be
entitled upon exercise of the Warrant to purchase the kind and number of
shares of stock or other securities or the amount or value of any cash,
assets or other property receivable upon such event by a holder of the number
of shares of the Common Stock which the Warrant entitles the holder of the
Warrant to purchase from the Company immediately prior to such event; and in
any such case, appropriate adjustment shall be made in the application of the
provisions set forth in this Agreement with respect to the Holder's rights
and interests thereafter, to the end that the provisions set forth in this
Agreement (including the specified changes and other adjustments to the
Exercise Price) shall thereafter be applicable in relation to any shares or
other property thereafter purchasable upon exercise of the Warrant.
(d) In the event the Company should at any time or from time to
time after the Issuance Date fix a record date for the determination of
holders of Common Stock entitled to receive a dividend or other distribution
payable in securities or rights convertible into, or entitling the holder
thereof to receive, directly or indirectly, additional shares of Common Stock
or the securities or such rights of any other corporation (other than Common
Stock Equivalents covered be Section 6(a) hereof), the Holder shall
thereafter be entitled upon exercise of the Warrant to receive, in addition
to the Purchased Shares being purchased upon such exercise, the securities or
rights convertible into securities receivable upon such event by a holder of
the number of shares of the Common Stock which the Holder is purchasing upon
such exercise.
(e) If it is expected that there will occur any event described in
Section 68 or 6(d) hereof, the Company shall give the holder of the Warrants
notice thereof, which notice shall
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be given at such time or times as notice is given to the holders of the
Company's Common Stock.
(f) The provisions of this Section 6 are intended to be exclusive,
and the holder of the Warrant shall have no rights other than as set forth in
this Agreement (and the rights of a stockholder upon exercise of the Warrant)
upon the occurrence of any of the events described in this Section 6.
(g) The grant of the Warrant shall not affect in any way the right
or power of the Company to make adjustments, reclassifications,
reorganizations or changes in its capital or business structure, or to merge,
consolidate, dissolve or liquidate, or to sell or transfer all or any part of
its business or assets.
7. REPRESENTATIONS AND WARRANTIES OF HOLDER.
Holder makes the following representations and warranties:
(a) Holder is acquiring the Warrants for its own account with the
present intention of holding such securities for investment purposes only and
not with a view to, or for sale in connection with, any distribution of such
securities (other than a distribution in compliance with all applicable federal
and state securities laws).
(b) Holder is an experienced and sophisticated investor and has such
knowledge and experience in financial and business matters that it is capable of
evaluating the relative merits and the risks of an investment in the Warrants
and in the Warrant Shares and of protecting its own interests in connection with
this transaction.
(c) Holder is willing to bear and is capable of bearing the economic
risk of an investment in the Warrants and the Warrant Shares.
(d) The Company has made available, prior to the date of this
Agreement, to Holder the opportunity to ask questions of the Company and its
officers, and to receive from the Company and its officers information
concerning the terms and conditions of the Warrants and this Agreement and to
obtain any additional information with respect to the Company, its business,
operations and prospects, as reasonably requested by Holder.
(e) Holder is an "accredited investor" as that term is defined
under Rule 501(a) of Regulation D promulgated by the Securities and Exchange
Commission under the Act.
(f) For purposes of the application of federal and state
securities laws, Holder acknowledges that the offer and sale of the Warrants
to such Holder occurred in the State of California and that such Holder is a
resident of the State of California.
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8. LEGEND ON STOCK CERTIFICATES.
Holder agrees that all certificates representing the Purchased Shares
will be subject to such stock transfer orders and other restrictions as the
Company may deem advisable under the rules, regulations and other
requirements of the Securities and Exchange Commission (the "Commission"),
any stock exchange upon which the Common Stock is then listed and any
applicable federal or state securities laws, and the Company may cause the
following legend to be put on such certificates to make appropriate reference
to such restrictions:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED OR OTHERWISE HYPOTHECATED WITHOUT REGISTRATION UNDER SUCH
ACT OR PURSUANT TO AN EXEMPTION THEREFROM.
9. NO RIGHTS AS STOCKHOLDER.
Holder shall have no rights as a stockholder of the Company with respect
to the Warrant Shares until the date of the issuance to Holder of a stock
certificate or stock certificates evidencing such Warrant Shares. Except as
may be provided in Paragraph 6 of this Agreement, no adjustment shall be made
for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued.
10. MODIFICATION.
The Board or a committee thereof may modify, extend or renew the Warrant
or accept the surrender of, and authorize the grant of a new option in
substitution for, the Warrant (to the extent not previously exercised). No
modification of the Warrant shall be made without the consent of Holder which
would alter or impair any rights of Holder under the Warrant.
11. COVENANTS OF HOLDER AND THE COMPANY.
(a) DEMAND REGISTRATION.
i) At the later to occur of (I) one year following the closing of
any initial public offering of the Company=s securities, and (ii) that date
upon which the Company is eligible to register the Warrant Shares for resale
on a Form S-3, the Holder may deliver a written request (the "Notice")
executed by the Holder and requesting registration of the resale by Holder of
all of the Purchased Shares. As soon as practicable after receipt of the
Notice, the Company shall at its sole cost and expense file a registration
statement with the Commission on Form S-3 or any successor form, under the
Securities Act, covering the issuance of the Warrant Shares issuable to the
Holder upon exercise of the Warrant or the resale of the Warrant Shares
issuable upon
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exercise of the Warrant by the Holder. The Company will use its best efforts
to have such registration statement declared effective as soon as possible
thereafter, and shall keep such registration statement current and effective
until such time as the Warrant Shares issuable upon exercise of the Warrant
may be sold by the Holder at any time without restriction or pursuant to the
provisions of Rule 144(k) of the Commission or until such earlier date as all
of the Purchased Shares registered pursuant to such registration statement
shall have been sold or otherwise transferred by the Holder to a third party.
The Company shall also prepare and file with the Commission such amendments
and supplements to such registration statement (and the prospectus used in
connection therewith) as may be necessary to update and keep such
registration statement (and the prospectus used in connection therewith)
current and effective for such three-year period and to comply with the
provisions of the Securities Act with respect to the sale of all securities
covered by such registration statement.
ii) The Company shall not be required to effect a registration
pursuant to this Section 11(a): (I) after the Company has effected one (1)
registration pursuant to this Section 11(a), and such registration has either
(A) been declared or ordered effective or (B) the request for such
registration has been subsequently withdrawn by the Holder (and such
withdrawal is not based on materially adverse information concerning the
Company of which the Holder was not reasonably aware at the time of such
request); or (ii) if the Warrant Shares issuable upon exercise of the Warrant
may be sold by the Holder at any time without restriction or pursuant to the
provisions of Rule 144(k); or (iii) if Form S-3 (or a successor or similar
form) is not available for such offering by the Holder; or (iv) if the
Company shall furnish to the Holder following receipt of his written request
for registration, a certificate signed on behalf of the Board of Directors by
the Chairman of the Board stating that in the good faith judgment of the
Board of Directors of the Company, it would be seriously detrimental to the
Company and its shareholders for such registration statement to be filed and
it is therefore essential to defer the filing of such registration statement,
in which event the Company shall have the right to defer such filing for a
period of not more than one hundred eighty (180) days after receipt of the
Holder's request for registration.
(b) PIGGYBACK REGISTRATION OF WARRANT SHARES. If, at any time
during the period commencing on the date that is 180 days from the date upon
which an IPO is declared effective by the Commission and on or before
December 31, December 31, 2003, the Company shall propose to register any
shares of Common Stock (but excluding any shares or securities being
registered pursuant to Form S-8 or Form S-4 or any successor form thereto),
the Company shall (I) give the Holder written notice, or telegraphic,
telecopy or telephonic notice followed as soon as practicable by written
confirmation thereof, of such proposed registration at least 20 business days
prior to the filing of such registration statement and, (ii) upon written
notice, or telegraphic or telephonic notice followed as soon as practicable
by written confirmation thereof, given to the Company by the Holder within 15
days after the giving of such written confirmation or written notice by the
Company, the Company shall include or cause to be included in any such
registration statement all or such portion of the Warrant Shares as the
Holder may request; PROVIDED, HOWEVER, that the Company may at any time
withdraw or cease proceeding with any such registration if it shall at the
same time withdraw or cease proceeding with the registration of the Common
Stock originally proposed to be registered;
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and PROVIDED FURTHER, that in connection with any registered public offering
involving an underwriting, the managing underwriter may (if in its reasonable
opinion marketing factors so require) limit the number of securities
(including any Warrant Shares) included in such offering (other than
securities of the Company). In the event of any such limitation, the total
number of Warrant Shares to be offered for the account of the Holder in the
registration shall be reduced in proportion to the respective number of
shares requested to be included therein by all holders of the Company's
Common Stock (other than the Company) entitled to include shares of Common
Stock in the registration to the extent necessary to reduce the total number
of shares proposed to be registered to the number of shares recommended by
the managing underwriter.
(c) COMPANY'S OBLIGATIONS IN REGISTRATION. The following provisions
shall also be applicable at the sole cost and expense of the Company in the case
of registrations under Section 11:
i) Following the effective date of such registration statement,
the Company shall, upon the request of the Holder, forthwith supply such
number of prospectuses meeting the requirements of the Securities Act as
shall be requested by the Holder to permit it to make a public distribution
of all of its Warrant Shares, provided that the Holder shall from time to
time furnish the Company with such appropriate information (relating to the
intentions of the Holder) in connection therewith as the Company shall
request in writing.
ii) the Company shall bear the entire cost and expense of the
registration of securities provided for in this Section (but not the selling
expenses of the Holder).
iii) the Company shall indemnify and hold harmless the Holder from
and against any and all losses, claims, damages and liabilities (including
reasonable fees and expenses of counsel) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement or any prospectus included therein required to be
filed or furnished by reason of this Section or otherwise or in any
application or other filing under, the Securities Act or any other applicable
Federal or state securities law, or arising out of or based upon any omission
or alleged omission to state therein a material fact required to be stated
therein (i.e., in any such registration statement, prospectus, application or
other filing) or necessary to make the statements therein not misleading, to
which such person may become subject, or any violation or alleged violation
by the Company to which such Person may become subject, under the Securities
Act, the Exchange Act, or other Federal or state laws or regulations, at
common law or otherwise, except to the extent that such losses, claims,
damages or liabilities are caused by any such untrue statement or alleged
untrue statement or omission or alleged omission based upon and in strict
conformity with written information furnished to the Company by such person
expressly for use therein; PROVIDED HOWEVER, that the Holder shall at the
same time indemnify the Company, its directors, each officer signing the
related registration statement, and each person, if any, who controls the
Company within the meaning of the Securities Act, from and against any and
all losses, claims, damages and liabilities (including reasonable fees and
expenses of counsel) arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any
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registration statement or any prospectus included therein required to be
filed or furnished by reason of this Section, or otherwise or in any
application or other filing under, the Securities Act or any other applicable
Federal or state securities law, or arising out of or based upon any omission
or alleged omission to state therein a material fact required to be stated
therein (i.e., in any such registration statement, prospectus, application or
other filing) or necessary to make the statements therein not misleading, to
which such person may become subject, or any violation or alleged violation
by the Holder to which the Company, its directors, each officer signing the
related registration statement, and each person, if any, who controls the
Company within the meaning of the Securities Act, may become subject, under
the Securities Act, the Exchange Act, or other Federal or state laws or
regulations, at common law or otherwise, to the extent that such losses,
claims, damages or liabilities are caused by any such untrue statement or
alleged untrue statement or omission or alleged omission based upon and in
strict conformity with written information furnished to the Company by the
Holder expressly for use therein.
(d) In the event any person entitled to indemnification hereunder
receives in writing a complaint, claim or other written notice of any loss,
claim, damage, liability or action giving rise to a claim for indemnification
under Section 11(c)(iii), the person claiming indemnification under Section
11(c)(iii) shall promptly notify the person or persons against whom
indemnification is sought (the "Indemnitor") of such complaint, notice, claim
or action, and the Indemnitor shall have the right to investigate and defend
any such loss, claim, damage, liability or action. The person claiming
indemnification shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel shall not be at the expense of the Indemnitor. In no event
shall the Indemnitor be obligated to indemnify any person for any settlement
of any claim or action effected without the Indemnitor's consent, which
consent shall not be unreasonably withheld.
12. DISPUTES.
(a) ARBITRATION. All disputes arising in connection with this
Agreement shall be finally settled by arbitration in Los Angeles, California,
in accordance with the rules of the American Arbitration Association (the
"Rules of Arbitration") and judgment on the award rendered by the arbitration
panel (the "Arbitration Panel") may be entered in any court or tribunal of
competent jurisdiction.
(b) Any party which desires to initiate arbitration proceedings as
provided in Section 11(a) above may do so by delivering written notice to the
other party (the "Arbitration Notice") specifying (A) the nature of the
dispute or controversy to be arbitrated, (B) the name and address of the
arbitrator appointed by the party initiating such arbitration and -c- such
other matters as may be required by the Rules of Arbitration.
(c) The Parties shall appoint a single arbitrator who shall
constitute the Arbitration Panel hereunder. Should the parties not agree
upon the appointment of the arbitrator within 30 days
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of delivery of the Arbitration Notice, the Arbitrator shall be appointed in
accordance with the Rules of Arbitration.
(d) In any arbitration proceeding conducted pursuant to the
provisions of this Section 11, both parties shall have the right to
discovery, to call witnesses and to cross-examine the opposing party's
witnesses, either through legal counsel, expert witnesses or both.
(e) FINALITY OF DECISION. All decisions of the Arbitration Panel
shall be final, conclusive and binding on all parties and shall not be
subject to judicial review. The arbitrator shall divide all costs (other
than fees of counsel) incurred in conducting the arbitration proceeding and
the final award in accordance with what they deem just and equitable under
the circumstances.
(f) LIMITATIONS. Notwithstanding anything to the contrary
contained in Sections 11(a) and 11(b) above, any claim by either party for
injunctive or other equitable relief, including specific performance, may be
brought in any court of competent jurisdiction and any judgment, order or
decree relating thereto shall have precedence over any arbitral award or
proceeding.
13. GENERAL PROVISIONS.
(a) FURTHER ASSURANCES. Holder shall promptly take all actions
and execute all documents requested by the Company which the Company deems to
be reasonably necessary to effectuate the terms and intent of this Agreement.
(b) NOTICES. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be given to
the parties hereto as follows:
If to the Company, to:
CUMETRIX, Inc.
0000 Xxxx Xxxx Xxxxx
Xxxx xx Xxxxxxxx, XX 00000
Attention: Chief Executive Officer
If to Holder, to the address set
forth in the records of the Company,
or at such other address or addresses as may have been furnished by either party
in writing to the other party hereto. Any such notice, request, demand or other
communication shall be effective (I) if given by mail, two days after such
communication is deposited in the mail by first-class certified mail, return
receipt requested, postage prepaid, addressed as aforesaid, or (ii) if given by
any other means, when delivered at the address specified in this subparagraph
(b).
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(c) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA APPLICABLE
TO CONTRACTS MADE IN, AND TO BE PERFORMED WITHIN, THAT STATE. JURISDICTION
AND VENUE OVER ANY LEGAL ACTION BROUGHT HEREUNDER SHALL RESIDE EXCLUSIVELY IN
THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA. EACH OF THE PARTIES HERETO
WAIVE THEIR RIGHT TO A JURY TRIAL WITH RESPECT TO ANY SUCH LEGAL ACTIONS.
(d) ATTORNEYS' FEES. In the event that any action, suit or
arbitration or other proceeding is instituted upon any breach of this
Agreement, the prevailing party shall be paid by the other party thereto an
amount equal to all of the prevailing party's costs and expenses, including
attorneys' fees incurred in each and every such action, suit or proceeding
(including any and all appeals or petitions therefrom). As used in this
Agreement, "attorneys' fees" shall mean the full and actual cost of any legal
services actually performed in connection with the matter involved calculated
on the basis of the usual fee charged by the attorney performing such
services and shall not be limited to "reasonable attorneys' fees" as defined
in any statute or rule of court.
(e) AMENDMENT; WAIVER. This Agreement shall be binding upon and
inure to the benefit of the parties to this Agreement and their respective
successors, heirs and personal representatives. No provision of this
Agreement may be amended or waived unless in writing signed by all of the
parties to this Agreement. Waiver of any one provision of this Agreement
shall not be deemed to be a waiver of any other provision.
(f) NO FINDERS. The parties each agree to indemnify and hold
harmless the other against any expense incurred by reason of any consulting,
brokerage commission or finder's fee alleged to be payable to any person in
connection with the transactions contemplated hereby because of any act,
omission or statement of indemnifying party or any dealings by the
indemnifying party with any consultant, broker or finder.
(g) EXPENSES. Each of the parties shall pay its own expenses
incurred in connection with the preparation of this Agreement and the
consummation of the transactions contemplated hereby.
(h) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be or
become prohibited or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.
(i) COUNTERPARTS. This Agreement may be executed in several
counterparts, all of which together shall constitute one agreement binding on
all parties hereto, notwithstanding that all of the parties have not signed the
same counterpart.
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(j) ENTIRE AGREEMENT. This Agreement constitutes and embodies the
entire understanding and agreement of the parties hereto relating to the
subject matter hereof and there are no other agreements or understandings,
written or oral, in effect between the parties relating to such subject
matter except as expressly referred to herein.
(k) MISCELLANEOUS. Titles and captions contained in this
Agreement are inserted for convenience of reference only and do not
constitute a part of this Agreement for any other purpose. Except as
specifically provided herein, neither this Agreement nor any right pursuant
hereto or interest herein shall be assignable by any of the parties hereto
without the prior written consent of the other party hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
CUMETRIX, Inc.
By: /s/ MAX TOGHRAIE
------------------------------------
Max Toghraie
Its: Chief Executive Officer
TROOP XXXXXXXXX XXXXXXX & XXXXXX, LLP
By: /s/XXXXXX XXXXXXXX
------------------------------------
Xxxxxx Xxxxxxxx, Partner
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EXHIBIT "A"
NOTICE OF EXERCISE
(TO BE SIGNED ONLY UPON EXERCISE OF THE WARRANT)
TO: CUMETRIX, INC.
The undersigned hereby irrevocably elects (to the extent indicated herein)
to exercise the purchase right represented by the Warrant granted to the
undersigned on November --, 1997 and to purchase thereunder ___________ shares
of Common Stock of CUMETRIX, Inc., a California corporation (the "Company").
The closing of the exercise of the purchase right shall take place at _____ on
_________________, ____ at the principal executive office of the Company located
at 0000 Xxxx Xxxx Xxxxx, Xxxx xx Xxxxxxxx, XX 00000.
HOLDER
By: _______________________________
Its: _______________________________
13
