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EXHIBIT 4.2
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CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
among
CAYENNE SOFTWARE, INC.
and
THE SEVERAL PURCHASERS IDENTIFIED
IN SCHEDULE A ATTACHED HERETO
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August 28, 1997
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CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT, dated as of August 28,
1997 (this "Agreement"), by and among Cayenne Software, Inc., a Massachusetts
corporation (the "Company"), and the several Purchasers identified in Schedule A
attached hereto (the "Purchasers").
WHEREAS, subject to the terms and conditions set forth in this
Agreement, the Company desires to issue and sell to the Purchasers and the
Purchasers desire to acquire shares of the Company's Series D Convertible
Preferred Stock, par value $1.00 per share (the "Preferred Stock") and warrants
to purchase shares of the Company's Common Stock,
IN CONSIDERATION of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Section 1.1. Certain Definitions. As used in this Agreement and
unless the context requires a different meaning, the following terms have the
meanings indicated:
"Affiliate" means, with respect to any Person, any Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person. For the purposes of this definition, "control" (including,
with correlative meanings, the terms "controlled by" and "under common control
with") shall mean the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such Person, whether
through the ownership of voting securities or by contract or otherwise.
"Business Day" means any day except Saturday, Sunday and any day
which shall be a legal holiday or a day on which banking institutions in the
State of New York are authorized or required by law or other government actions
to close.
"Closing Date" means the Series D closing date.
"Code" means the Internal Revenue Code of 1986, as amended, and
the rules and regulations thereunder as in effect on the date hereof.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the Company's common stock, par value $0.01
per share.
"Disclosure Materials" means, collectively, the SEC Documents,
the disclosure package delivered to the Purchaser in connection with the
offering by the Company of the Shares and the Warrants and the Schedules to this
Agreement furnished by or on behalf of the Company pursuant to Section 3.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Xxxxx Xxxx" shall mean Xxxxx, Xxxx & Xxxxx LLP, Xxx Xxxx Xxxxxx
Xxxxxx, Xxxxxx, XX 00000(x)
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"Lien" means, with respect to any asset, any mortgage, lien,
pledge, encumbrance, right of first refusal, charge or security interest of any
kind in or on such asset or the revenues or income thereon or therefrom.
"Material Adverse Effect" shall have the meaning set forth in
Section 3.1(a).
"Original Issue Date" shall have the respective meanings (as
applicable) set forth in the Statements of Rights and Preferences.
"Person" means an individual or a corporation, partnership,
trust, incorporated or unincorporated association, joint venture, limited
liability company, joint stock company, government (or an agency or political
subdivision thereof) or other entity of any kind.
"Preferred Stock" shall have the meaning set forth in the
recitals hereto.
"Purchase Price" shall have the meaning set forth in Section 2.2.
"Purchaser" and "Purchasers" both mean all the Purchasers
collectively or one or more Purchasers severally, as may be appropriate in the
context.
"Registration Rights Agreement" means the registration rights
agreement, dated as of the date hereof, by and between the Company and the
Purchaser, in the form of Exhibit B, as the same may be amended, supplemented or
otherwise modified in accordance with its terms.
"Required Approvals" shall have the meaning set forth in Section
3.1(f).
"SEC Documents" shall have the meaning set forth in Section
3.1(l).
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means the shares of Preferred Stock purchased by the
Purchaser pursuant to this Agreement.
"Statement of Rights and Preferences" shall have the meaning set
forth in Section 2.1(b).
"Subsequent Sale" shall have the meaning set forth in Section
4.12(a).
"Subsequent Sale Notice" shall have the meaning set forth in
Section 4.12(a).
"Subsidiaries" shall have the meaning set forth in Section
3.1(a).
"Trading Day" shall have the meaning set forth in the Series D
Terms.
"Underlying Securities Registration Statement" shall have the
meaning set forth in Section 3.1(f).
"Underlying Shares" means the shares of Common Stock into which
the Shares are convertible in accordance with the terms hereof and the
Statements of Rights and Preferences.
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"Warrants" shall have the meaning set forth in Section 4.20.
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ARTICLE II
PURCHASE AND SALE OF SHARES
Section 2.1. Purchase and Sale of Shares.
(a) Subject to the terms and conditions set forth herein, at the
closing referred to below, the Company shall issue and sell to the Purchasers
and the Purchasers shall purchase shares of Preferred Stock in the respective
amounts set forth in Schedule A.
(b) The Preferred Stock shall have the respective rights,
preferences and privileges set forth in Exhibit A attached hereto (the "Series D
Terms"), which shall be incorporated into a Statement of Rights and Preferences
to be filed on or prior to the Closing Date (as defined below) by the Company
with the Commonwealth of Massachusetts (the "Series D Statement of Rights and
Preferences").
For purposes of this Agreement, "Conversion Price," "Original Issue
Date," "Conversion Date" "Trading Day" and "Per Share Market Value" shall have
the meanings set forth in the Series D Terms.
Section 2.2. Purchase Price.
The purchase price per Share shall be $20.00.
Section 2.3. The Closing.
(a) The Series D Closing. (i) (A) The closing (the "Series D
Closing") of the purchase and sale of shares of Preferred Stock (the "Series D
Shares") to be issued and sold thereat in accordance with the terms and
conditions set forth herein, shall take place at the offices of Xxxxx Xxxx on
the date hereof or as soon thereafter as practicable. ("Closing Date").
(b) At the Series D Closing, (1) the Company shall deliver to
each Purchaser one or more stock certificates representing the Series D Shares
and the Series D Warrants (as defined in Section 4.20), each registered in the
name of the Purchaser, the legal opinion of Xxxxx, Xxxx & Xxxxx LLP, counsel to
the Company, substantially in the form of Exhibit C, and all other documents,
instruments and writings required to have been delivered at or prior to the
Series D Closing by the Company pursuant to this Agreement, and (2) each
Purchaser shall deliver to the Company the purchase price for such Series D
Shares (calculated in accordance with Section 2.2) in United States dollars in
immediately available funds by wire transfer to an account designated in writing
by the Company for such purpose prior to the Closing Date, and all other
documents, instruments and writings required to have been delivered at or prior
to the Series D Closing by the Purchaser pursuant to this Agreement.
(c) In addition, at the Series D closing, the Company shall
deliver to the Purchasers:
(i) one or more executed counterparts of the
Registration Rights Agreement in the form attached hereto as Exhibit B;
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(ii) an executed counterpart of the Transfer Agent
Instruction letter in the form attached hereto as Exhibit D;
(iii) a copy of the Certificate of Vote of Directors
Establishing a Series of a Class of Stock relating to the designation
of the Series D Preferred Stock, date-stamped by the office of the
Massachusetts State Secretary to acknowledge filing with that office;
(iv) a certificate of the Clerk or Assistant Clerk of
the Company certifying the Articles of Organization and By-Laws of the
Company as currently in effect and the adoption by the Company's Board
of Directors of resolutions authorizing the transactions contemplated
by this Agreement and the related documents referred to herein; and
(v) a letter from Xxxxx Xxxx addressed to the
Purchasers acknowledging that Xxxxx Xxxx is holding for the benefit of
the respective Purchasers original counterparts executed by the Company
of this Agreement and the related documents, including certificates for
Shares of Preferred Stock and original Warrants, to be executed by the
Company, pending confirmation of receipt by the Company of the purchase
price.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representations and Warranties of the Company. The
Company hereby represents and warrants to the Purchaser as follows:
(a) Organization and Qualification. The Company is a
corporation, duly incorporated, validly existing and in good standing under the
laws of The Commonwealth of Massachusetts, with the requisite corporate power
and authority to own and use its properties and assets and to carry on its
business as currently conducted. The Company has no subsidiaries other than as
set forth in the SEC Documents or in Schedule 3.1(a) (collectively, the
"Subsidiaries"). Each of the Subsidiaries is a corporation, duly incorporated,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, with the full corporate power and authority to own and use its
properties and assets and to carry on its business as currently conducted. Each
of the Company and the Subsidiaries is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in which the nature
of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as
the case may be, could not, individually or in the aggregate, have a material
adverse effect on the results of operations, assets, prospects, or financial
condition of the Company and the Subsidiaries, taken as a whole (a "Material
Adverse Effect").
(b) Authorization; Enforcement. The Company has the requisite
corporate power and authority to enter into and to consummate the transactions
contemplated hereby, by the Warrants, by the Statements of Rights and
Preferences and by the Registration Rights Agreement, and otherwise to carry out
its obligations hereunder and thereunder. This Agreement, the Registration
Rights Agreement, the Statements of Rights and Preferences and the Warrants are
collectively referred to as the "Transaction Documents." The execution and
delivery of the Transaction Documents by the Company and the consummation by it
of the transactions contemplated thereby have been duly authorized by all
necessary action on the part of the Company. Each of the Transaction Documents
has been duly executed and delivered by the
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Company and constitutes the legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally the enforcement of, creditors' rights and remedies or by
other equitable principles of general application. Neither the Company nor any
Subsidiary is in violation of any of the provisions of its respective articles
of organization, bylaws or other charter documents.
(c) Capitalization. The authorized, issued and outstanding
capital stock of the Company and each of the Subsidiaries is set forth in
Schedule 3.1(c). No shares of Common Stock are entitled to preemptive or similar
rights. Except as specifically disclosed in Schedule 3.1(c), there are no
outstanding options, warrants, script rights to subscribe to, calls or
commitments of any character whatsoever relating to, or, except as a result of
the purchase and sale of the Shares and Warrants hereunder, securities, rights
or obligations convertible into or exchangeable for, or giving any person any
right to subscribe for or acquire any shares of Common Stock, or contracts,
commitments, understandings, or arrangements by which the Company or any
Subsidiary is or may become bound to issue additional shares of Common Stock, or
securities or rights convertible or exchangeable into shares of Common Stock.
(d) Issuance of Shares, Warrants, Warrant Shares and Underlying
Shares. The Shares and the Warrants are duly authorized and, when paid for in
accordance with the terms hereof, shall be validly issued, fully paid and
nonassessable, free and clear of any Liens. The Company, as at the Closing Date
will have and at all times while the Shares and any Warrants are outstanding
will maintain an adequate reserve of shares of Common Stock to enable it to
perform its conversion and other obligations under this Agreement, the Warrants
and the Statements of Rights and Preferences with respect to the number of
Shares and Warrants issued and outstanding at such Closing Date, which reserve
shall be no less than the sum of (i) the greater of (x) 125% of the number of
shares of Common Stock issuable upon conversion of all the Series D Preferred
Stock outstanding from time to time or (y) twice the number of shares of Common
Stock issuable hereunder and pursuant to the terms of the Statements of Rights
and Preferences, assuming a conversion in full of all of the Shares on the
Original Issue Date thereof and (ii) the number of shares of Common Stock
issuable upon the exercise in full of the Warrants (the "Warrant Shares") to be
issued at such Closing Date. When issued in accordance with the terms hereof and
the Statements of Rights and Preferences, and the Warrants, the Underlying
Shares and the Warrant Shares will be duly authorized, validly issued, fully
paid and nonassessable, free and clear of all Liens.
(e) No Conflicts. The execution, delivery and performance of
the Transaction Documents by the Company and the consummation by the Company of
the transactions contemplated thereby do not and will not (i) conflict with or
violate any provision of its articles of organization or bylaws (each as amended
through the date hereof) or (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company is
a party, or (iii) to the knowledge of the Company result in a violation of any
law, rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority to which the Company is subject
(including Federal and State securities laws and regulations), or by which any
property or asset of the Company is bound or affected, except in the case of
each of clauses (ii) and (iii), such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as could not,
individually or in the aggregate, (x) adversely affect the legality, validity or
enforceability of the Transaction Documents, (y) have a Material Adverse Effect
or (z)
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adversely impair the Company's ability to perform fully on a timely basis its
obligations under the Transaction Documents. The business of the Company is not
being conducted in violation of any law, ordinance or regulation of any
governmental authority, the violation of which would have a Material Adverse
Effect.
(f) Consents and Approvals. Except as specifically set forth in
Schedule 3.1(f), neither the Company nor any Subsidiary is required to obtain
any consent, waiver, authorization or order of, or make any filing or
registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with the execution,
delivery and performance by the Company of the Transaction Documents, except for
(i) the filing of the Statements of Rights and Preferences with respect to the
Shares with the Secretary of State of The Commonwealth of Massachusetts, which
filing shall be effected prior to the applicable Closing Date, (ii) the filing
of the registration statements covering the Underlying Shares and the Warrant
Shares (the "Underlying Securities Registration Statement") with the Commission
and the making of the applicable blue-sky filings under state securities laws,
each as contemplated by the Registration Rights Agreement and (iii) other than,
in all other cases, where the failure to obtain such consent, waiver,
authorization or order, or to give or make such notice or filing, could not,
individually or in the aggregate, (x) adversely affect the legality, validity or
enforceability of the Transaction Documents, (y) have a Material Adverse Effect
or (z) adversely impair the Company's ability to perform fully on a timely basis
its obligations under the Transaction Documents (together with the consents,
waivers, authorizations, orders, notices and filings referred to in Schedule
3.1(f), the "Required Approvals"). The consents described in Exhibit 3.1(f) have
been received.
(g) Litigation; Proceedings. There is no action, suit, notice
of violation, proceeding or investigation pending or, to the best knowledge of
the Company, threatened against or affecting the Company or any of its
Subsidiaries or any of their respective properties before or by any court,
governmental or administrative agency or regulatory authority (Federal, state,
county, local or foreign) which (i) relates to or challenges the legality,
validity or enforceability of the Transaction Documents or the Shares (ii)
could, individually or in the aggregate, have a Material Adverse Effect or (iii)
could, individually or in the aggregate, adversely impair the ability of the
Company to perform fully on a timely basis its obligations under the Transaction
Documents.
(h) No Default or Violation. Neither the Company nor any
Subsidiary (i) is in default under or in violation of any indenture, loan or
credit agreement or any other agreement or instrument to which it is a party or
by which it or any of its properties is bound, except such conflicts or defaults
as do not have a Material Adverse Effect, (ii) is in violation of any order of
any court, arbitrator or governmental body, except for such violations as do not
have a Material Adverse Effect, or (iii) is in violation of any statute, rule or
regulation of any governmental authority which could (individually or in the
aggregate) (x) adversely affect the legality, validity or enforceability of the
Transaction Documents, (y) have a Material Adverse Effect or (z) adversely
impair the Company's ability or obligation to perform fully on a timely basis
its obligations under the Transaction Documents.
(i) Certain Fees. No fees or commission will be payable by the
Company to any broker, finder, investment banker or bank with respect to the
consummation of the transactions contemplated hereby. The Company has taken no
action that would require any Purchaser to pay any such fee or commission.
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(j) Disclosure Materials. The Disclosure Materials do not
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
(k) Private Offering. Neither the Company nor any Person acting
on its behalf has taken or will take any action (including, without limitation,
any offering of any securities of the Company under circumstances which would
require the integration of such offering with the offering of the Shares, the
Warrants the Underlying Shares or the Warrant Shares under the Securities Act)
which might subject the offering, issuance or sale of the Shares, the Warrants
the Underlying Shares or the Warrant Shares to the registration requirements of
Section 5 of the Securities Act.
(l) SEC Documents. The Company has filed all reports required
to be filed by it under the Exchange Act, including pursuant to Section 13(a) or
15(d) thereof, for the three years preceding the date hereof (the foregoing
materials being collectively referred to herein as the "SEC Documents") on a
timely basis, or has received a valid extension of such time of filing. As of
their respective dates, the SEC Documents complied in all material respects with
the requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Documents, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The financial statements of the Company included
in the SEC Documents comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the
Commission with respect thereto. Such financial statements have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis during the periods involved, except as may be otherwise indicated in such
financial statements or the notes thereto, and fairly present in all material
respects the financial position of the Company and its consolidated subsidiaries
as of and for the dates thereof and the results of operations and cash flows for
the periods then ended, subject, in the case of unaudited statements, to normal
year-end audit adjustments. Since the date of the financial statements included
in the Company's last filed Quarterly Report on Form 10-Q, there has been no
event, occurrence or development that has had a Material Adverse Effect which is
not specifically disclosed in any of the Disclosure Materials.
(m) Seniority. No class of equity securities of the Company is
senior to the Shares in right of payment, whether upon liquidation, dissolution
or otherwise.
(n) Exclusivity. The Company shall not issue and sell the
Preferred Stock to any Person other than the Purchaser.
(o) Form S-3 Eligibility. The Company is eligible to register
securities for resale with the Commission under Form S-3 promulgated under the
Securities Act.
(p) Investment Company. The Company is not and is not an
Affiliate of an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(q) Real Property Holding Company. The company is not a real
property holding company within the meaning of Section 897 of the Internal
Revenue Code of 1986, as amended.
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(r) Intellectual Property Rights. The Company and its
subsidiaries own or possess adequate rights or licenses to use all trademarks,
trade names, service marks, service approvals, governmental authorizations,
trade secrets and rights necessary to conduct their respective business as now
conducted. None of the Company's trademarks, trade names, service marks, service
xxxx registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, government authorizations, trade secrets or
other intellectual property rights have expired or terminated, or are expected
to expire or terminate within two years from the date of this Agreement. The
Company and its subsidiaries do not have any knowledge of any infringement by
the Company or its subsidiaries of trademark, trade name rights, patents, patent
rights, copyrights, inventions, licenses, service names, service marks, service
xxxx registrations, trade secret or other similar rights of others, or of any
such development of similar or identical trade secrets or technical information
by others and there is no claim, action or proceeding being made or brought
against, or to the Company's knowledge, being threatened against, the Company or
its subsidiaries regarding trademark, trade name, patents, patent rights,
invention, copyright, license, service names, service marks, service xxxx
registrations, trade secret or other infringement; and the Company and its
subsidiaries are unaware of any facts or circumstances which might give rise to
any of the foregoing. The Company and its subsidiaries have taken reasonable
security measures to protect the secrecy, confidentiality and value of all of
their intellectual properties.
(s) Title. The Company and its Subsidiaries have good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them which is material to the business
of the Company and its Subsidiaries, in each case free and clear of all liens,
encumbrances and defects except such as do not materially affect the value of
such property and do not interfere with the use made and proposed to be made of
such property by the Company or any of its Subsidiaries. Any real property and
facilities held under lease by the Company or any of its Subsidiaries are held
by them under valid, subsisting and enforceable leases with such exceptions as
are not material and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its Subsidiaries.
(t) Dilutive Effect. The Company understands and acknowledges
that the number of Conversion Shares issuable upon conversion of the Preferred
Shares and the Warrant Shares issuable upon exercise of the Warrants will
increase in certain circumstances. The Company further acknowledges that its
obligation to issue Conversion Shares upon conversions of the Preferred Shares
in accordance with this Agreement and the Statement of Rights and Preferences
and its obligation to issue the Warrant Shares upon exercise of the Warrants in
accordance with this Agreement and the Warrants, is, in each case, absolute and
unconditional regardless of the dilutive effect that such issuance may have on
the ownership interests of other stockholders of the Company.
Section 3.2. Representations and Warranties of the Purchasers.
Each Purchaser hereby severally represents and warrants to the Company as
follows:
(a) Organization; Authority. The Purchaser is a corporation,
partnership, limited liability company, or other entity duly and validly
existing and in good standing under the laws of the jurisdiction of its
organization. The Purchaser has the requisite power and authority to enter into
and to consummate the transactions contemplated hereby and by the other
Transaction Documents and otherwise to carry out its obligations hereunder and
thereunder. The purchase of the Shares and the Warrants by the Purchaser
hereunder has been duly authorized by all necessary action on the part of the
Purchaser. Each of the Transaction Documents has been
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duly executed and delivered by the Purchaser or on its behalf and constitutes
the valid and legally binding obligation of the Purchaser, enforceable against
the Purchaser in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights generally and to
general principles of equity.
(b) Investment Intent. The Purchaser is acquiring the Shares,
the Warrants, the Warrant Shares and the Underlying Shares for its own account
for investment purposes only and not with a view to or for distributing or
reselling such Shares, Warrants, Warrant Shares or Underlying Shares or any part
thereof or interest therein, without prejudice, however, to the Purchaser's
right, subject to the provisions of the Transaction Documents, at all times to
sell or otherwise dispose of all or any part of such Shares, Warrants, Warrant
Shares or Underlying Shares under an effective registration statement under the
Securities Act and in compliance with applicable state securities laws or under
an exemption from such registration.
(c) Purchaser Status. The Purchaser was not formed for the
purpose of acquiring the Shares and the Warrants. At the time the Purchaser was
offered the Shares and the Warrants, it was and at the date hereof it is an
"accredited investor" as defined in Rule 501(a) under the Securities Act.
(d) Experience of Purchaser. The Purchaser has such knowledge,
sophistication and experience in business and financial matters so as to be
capable of evaluating the merits and risks of the prospective investment in the
Shares, the Warrants, the Underlying Shares and the Warrant Shares, and has so
evaluated the merits and risks of such investment.
(e) Ability of Purchaser to Bear Risk of Investment. The
Purchaser is able to bear the economic risk of an investment in the Shares, the
Warrants, the Underlying Shares and the Warrant Shares and is able to afford a
complete loss of such investment.
(f) Prohibited Transactions. The Shares and the Warrants are
not being acquired, directly or indirectly, with the assets of any "employee
benefit plan", within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended.
(g) Access to Information. The Purchaser acknowledges receipt
of the Disclosure Materials and further acknowledges that it has been afforded
(i) the opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Company concerning the terms and
conditions of the offering of the Shares and the Warrants and the merits and
risks of investing in the Shares and the Warrants; (ii) access to information
about the Company and the Company's financial condition, results of operations,
business, properties, management and prospects sufficient to enable it to
evaluate its investment in the Company; and (iii) the opportunity to obtain such
additional information that the Company possesses or can acquire without
unreasonable effort or expense and that is necessary to make an informed
investment decision with respect to the Shares and the Warrants and to verify
the accuracy and completeness of the information contained in the Disclosure
Materials.
(h) Reliance. The Purchaser understands and acknowledges that
(i) the Shares and the Warrants are being offered and sold, and the Underlying
Shares and the Warrant Shares are being offered, to it without registration
under the Securities Act in a private placement that is exempt from the
registration provisions of the Securities Act and (ii) the availability of such
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exemption depends in part on, and that the Company will rely upon the accuracy
and truthfulness of, the foregoing representations and the Purchaser hereby
consents to such reliance.
The Company acknowledges and agrees that the Purchaser makes no
representation or warranty with respect to the transactions contemplated hereby
other than those specifically set forth in this Section 3.2.
ARTICLE IV
OTHER AGREEMENTS OF THE PARTIES
Section 4.1. Transfer Restrictions. If the Purchaser should
decide to dispose of any of the Shares or any portion of the Warrants (and upon
conversion or exercise thereof, any Underlying Shares or Warrant Shares), the
Purchaser understands and agrees that it may do so only (i) pursuant to an
effective the registration statement under the Securities Act, (ii) pursuant to
an available exemption from the registration requirements of the Securities Act
or (iii) to the Company. In connection with any transfer of any Shares,
Warrants, Underlying Shares or Warrant Shares other than pursuant to an
effective registration statement or to the Company, the Company may require that
the transferor provide to the Company an opinion of counsel experienced in the
area of United States securities laws selected by the transferor, the form and
substance of which opinion shall be reasonably satisfactory to the Company, to
the effect that such transfer does not require registration of such Shares,
Warrants, Underlying Shares or Warrant Shares under the Securities Act or any
state securities laws.
The Purchaser agrees to the imprinting, so long as is required by
this Section, of the following legend on certificates representing the Shares,
Warrants, Underlying Shares or Warrant Shares:
NEITHER THESE SECURITIES NOR ANY SECURITIES INTO WHICH THESE
SECURITIES MAY BE [CONVERTIBLE] [EXERCISABLE] HAVE BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION PROMULGATED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAW.
The legend set forth above shall be removed upon the conversion
of Shares or exercise of Warrants represented by such certificates at any time
while an Underlying Securities Registration Statement is effective under the
Securities Act or sooner if, in the opinion of counsel to the Company
experienced in the area of United States securities laws such legend is no
longer required under applicable requirements of the Securities Act (including
judicial interpretations and pronouncements issued by the staff of the
Commission). The Company agrees that it will provide the Purchaser, upon
request, with a substitute stock certificate or certificates or warrant
certificates, free from such legend at such time as such legend is no longer
applicable.
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Section 4.2. Stop Transfer Instruction. The Company may not make
any notation on its records or give instructions to any transfer agent of the
Company which enlarge the restrictions on transfer set forth in Section 4.1
above, or which are inconsistent with the instructions stated in Exhibit D.
Section 4.3. Furnishing of Information. For so long as the
Purchaser owns Shares, Warrants, Underlying Shares or Warrant Shares, the
Company covenants to timely file (or obtain valid extensions in respect thereof)
all reports required to be filed by the Company after the date hereof pursuant
to Section 13(a) or 15(d) of the Exchange Act and to promptly furnish the
Purchaser with true and complete copies of all such filings. If the Company is
not at the time required to file reports pursuant to such sections, it will
prepare and furnish to the Purchaser annual and quarterly financial statements,
together with a discussion and analysis of such financial statements in form and
substance substantially similar to those that would otherwise be required to be
included in reports required by Section 13(a) or 15(d) of the Exchange Act in
the time period that such filings would have been required to have been made
under the Exchange Act.
Section 4.4. Notice of Certain Events. The Company shall (i)
advise the Purchaser promptly after obtaining knowledge thereof, and, if
requested by the Purchaser, confirm such advice in writing, of (A) the issuance
by any state securities commission of any stop order suspending the
qualification or exemption from qualification of the Shares, Warrant Shares or
Underlying Shares or the Common Stock for offering or sale in any jurisdiction,
or the initiation of any proceeding for such purpose by any state securities
commission or other regulatory authority, or (B) any event that makes any
statement of a material fact made in the Disclosure Materials untrue or that
requires the making of any additions to or changes in the Disclosure Materials
in order to make the statements therein, in the light of the circumstances under
which they are made, not misleading, provided, however, that the Company shall
not give any notice before the facts disclosed in the notice have been publicly
disclosed, (ii) use its best efforts to prevent the issuance of any stop order
or order suspending the qualification or exemption from qualification of the
Shares, Warrant Shares or Underlying Shares or the Common Stock under any state
securities or Blue Sky laws, and (iii) if at any time any state securities
commission or other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Shares, Warrant Shares or
Underlying Shares or the Common Stock under any such laws, use its best efforts
to obtain the withdrawal or lifting of such order at the earliest possible time.
Section 4.5. Copies and Use of Disclosure Materials. The Company
shall furnish the Purchaser, without charge, as many copies of the Disclosure
Materials, and any amendments or supplements thereto, as the Purchaser may
reasonably request. The Company consents to the use of the Disclosure Materials,
and any amendments and supplements thereto, by the Purchaser in connection with
resales of the Shares, the Warrant Shares or the Underlying Shares other than
pursuant to an effective registration statement.
Section 4.6. Modification to Disclosure Materials. If any event
shall occur as a result of which, in the reasonable judgment of the Company, it
becomes necessary or advisable to amend or supplement the Disclosure Materials
in order to make the statements therein, in the light of the circumstances at
the time the Disclosure Materials were delivered to the Purchaser, not
misleading, or if it is necessary to amend or supplement the Disclosure
Materials to comply with applicable law, the Company shall promptly prepare an
appropriate amendment or supplement to the Disclosure Materials so that (i) as
so amended or supplemented the Disclosure Materials will not include an untrue
statement of material fact or omit to state a material fact necessary in order
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to make the statements therein, in the light of the circumstances existing at
the time it is delivered to Purchaser, not misleading and (ii) the Disclosure
Materials will comply in all material respects with applicable law.
Section 4.7. Blue Sky Laws. In accordance with the Registration
Rights Agreement, the Company shall qualify the Shares, the Warrants, the
Warrant Shares and the Underlying Shares under the securities or Blue Sky laws
of such jurisdictions as the Purchaser may reasonably request and to continue
such qualification at all times through the third anniversary of the Closing
Date; provided, however, that neither the Company nor its Subsidiaries shall be
required in connection therewith to qualify as a foreign corporation where they
are not now so qualified.
Section 4.8. Integration. The Company shall not and shall use its
best efforts to ensure that no Affiliate shall sell, offer for sale or solicit
offers to buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the Shares, the Warrant Shares or the Underlying Shares in a manner that
would require the registration under the Securities Act of the sale of the
Shares, the Warrant Shares or Underlying Shares to the Purchaser.
Section 4.9. Furnishing of Rule 144A Materials. The Company
shall, for so long as any of the Shares, Warrants, Warrant Shares or Underlying
Shares remain outstanding and during any period in which it is not subject to
Section 13 or 15(d) of the Exchange Act, make available to any registered holder
of Shares or Underlying Shares in connection with any sale thereof and any
prospective purchaser of such Shares, Warrants, Warrant Shares or Underlying
Shares from such Person, the following information in accordance with Rule
144A(d)(4) under the Securities Act: a brief statement of the nature of the
business of the Company and the products and services it offers and the
Company's most recent audited balance sheet and profit and loss and retained
earnings statements, and similar audited financial statements for such part of
the two preceding fiscal years as the Company has been in operation.
Section 4.10. Solicitation Materials. The Company shall not (i)
distribute any offering materials in connection with the offering and sale of
the Shares, Warrants, Warrant Shares or Underlying Shares other than the
Disclosure Materials and any amendments and supplements thereto prepared in
compliance herewith or (ii) solicit any offer to buy or sell the Shares,
Warrants, Warrant Shares or Underlying Shares by means of any form of general
solicitation or advertising.
Section 4.11. Subsequent Financial Statements. The Company shall
furnish to the Purchaser, promptly after they are filed with the Commission, a
copy of all financial statements for any period subsequent to the period covered
by the financial statements included in the Disclosure Materials.
Section 4.12. Right of First Refusal; Certain Corporate Actions.
(a) The Company shall not, directly or indirectly, without the prior written
consent of the Purchaser, offer, sell, grant any option to purchase or otherwise
dispose (or announce any offer, sale, grant or any option to purchase or other
disposition) of any of its or its Affiliates equity or equity equivalent
securities (a "Subsequent Sale") for a period of 180 days after the Closing
Date, except (i) upon conversion of any of the Preferred Stock or the Series C
Preferred Stock or exercise of any of the Warrants or warrants heretofore issued
in connection with the Series C Preferred Stock, (ii) as a stock dividend or
upon any subdivision of shares of Common Stock, provided that the securities
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issued pursuant to such stock dividend or subdivision are limited to additional
shares of Common Stock, (iii) pursuant to subscriptions, warrants, options,
convertible securities or other rights which are outstanding on the Closing
Date, (iv) solely in consideration for the acquisition (whether by merger or
otherwise) by the Company or any of its Subsidiaries of all or substantially all
of the stock or assets of any other entity, (v) pursuant to a primary registered
public offering under the Securities Act, other than an offering subject to Rule
415 under the Securities Act, (vi) pursuant to the exercise of options or
purchase rights to purchase Common Stock granted to employees, consultants and
directors of the Company pursuant to any stock purchase, stock option or
employee stock bonus plan approved by the Board of Directors, (vii) securities
issued to equipment lessors in connection with lease of corporate equipment by
the Company as approved by the Company's Board of Directors, (viii) upon the
exercise of any right other than a right to purchase securities which was not
itself in violation of the terms of this paragraph, and (ix) securities issued
in connection with refinancing the Company's existing bank debt, not more than
200,000 shares in any calendar year unless (A) the Company delivers to the
Purchaser a written notice (the "Subsequent Sale Notice") of its intention to
effect such Subsequent Sale, which Subsequent Sale Notice shall describe in
reasonable detail the proposed terms of such Subsequent Sale, the identity of
the Persons who proposes to provide such Subsequent Sale and the amount of
proceeds intended to be raised thereunder and (B) the Purchaser shall not have
notified the Company by 5:00 p.m. (Eastern Time) on the tenth Business Day after
its receipt of the Subsequent Sale Notice of its willingness to enter into good
faith negotiations to provide (or to cause its sole designee to provide)
financing to the Company on substantially the terms set forth in the Subsequent
Sale Notice. If the Purchaser shall fail to notify the Company of its intention
to enter into such negotiations within such time period, the Company may effect
the Subsequent Sale substantially upon the terms and to the Persons (or
Affiliates of such Persons) set forth in the Subsequent Sale Notice; provided,
that the Company shall provide the Purchaser with a second Subsequent Sale
Notice, and the Purchaser shall again have the right of first refusal set forth
above in this paragraph (a), subject to the exceptions set forth above in this
paragraph (a), if the Subsequent Sale subject to the initial Subsequent Sale
Notice shall not have been consummated for any reason on the terms set forth in
such Subsequent Sale Notice within 90 days after the date of the initial
Subsequent Sale Notice with the Person (or an Affiliate of such Person)
identified in the Subsequent Sale Notice.
(b) For as long as Preferred Stock or Warrants outstanding, the
Company shall not and shall cause the Subsidiaries not to, without the consent
of the Purchaser, (i) amend its Restated Articles of Organization, bylaws or
other charter documents so as to adversely affect any rights provided in the
Transaction Documents to the Preferred Stock and the Warrants; (ii) split,
combine or reclassify its outstanding capital stock; (iii) redeem, repurchase or
offer to repurchase or otherwise acquire shares of its Junior Securities (as
defined in the Statements of Rights and Preferences); or (iv) enter into any
agreement with respect to any of the foregoing.
Section 4.13. Notwithstanding anything to the contrary contained
herein, each Conversion Notice shall contain a representation that, after giving
effect to the shares of the Company's Common Stock to be issued pursuant to such
Conversion Notice, the total number of shares of the Company's Common Stock
deemed beneficially owned by the holder thereof, together with all shares of the
Company's Common Stock deemed beneficially owned by such holder's "affiliates"
as defined in Rule 144 promulgated under the Securities Act of 1933, as amended,
(exclusive of shares issuable upon conversion of the unconverted portion of the
Shares of Series D Preferred Stock or the unexercised or unconverted portion of
any other securities of the Company subject to a limitation on conversion or
exercise analogous to the limitations contained herein) will not result in
beneficial ownership by the holder and its affiliates of more
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than 4.9% of the outstanding shares of Common Stock. For purposes of this
subparagraph, beneficial ownership shall be determined in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation
13 D-G thereunder, except as other provided above. Any Conversion Notice which
does not contain such representation shall be ineffective provided, however,
that the requirement of this paragraph shall not apply to any Purchaser marked
as "excluded from Section 4.13" on Schedule A.
Section 4.14. Availability of Common Stock. The Company has duly
reserved a sum of 5,200,000 shares of authorized and unissued Common Stock for
issuance upon the conversion of Series D Shares and the exercise all of the
Series D Warrants. If at any time the Company does not have reserved sufficient
shares of Common Stock to enable it to perform its conversion and exercise
obligations hereunder with respect to all shares of Preferred Stock and all
Warrants then outstanding it shall, at the option of the holders of Preferred
Stock, redeem all Shares and Underlying Shares then held by such holders,
pursuant to Section 4.16 hereto.
Section 4.15. Listing of Underlying Shares and Warrant Shares.
Prior to the Closing, the Company shall have filed an additional listing
application with the Nasdaq National Market or SmallCap Market, as the case may
be (and each other national securities exchange on which the Common Stock is
then listed) for the listing of the Underlying Shares and the Warrant Shares.
The Company shall, as promptly as possible, take all steps necessary to cause
the Underlying Shares and Warrant Shares to be approved for listing in the
Nasdaq National Market or SmallCap Market (and each other national securities
exchange or market on which the Common Stock is then listed), and shall provide
to the Purchaser evidence of such listing when approved and shall maintain the
listing of its Common Stock on such exchange.
Section 4.16. Purchaser's Rights if Trading in Common Stock is
Suspended or Delisted. In the event that at any time within the three-year
period after the Closing Date trading in the shares of the Common Stock is
suspended, or if the Common Stock shall not listed for trading, on the Nasdaq
National Market (other than as a result of the suspension of trading in
securities on such market or exchange generally or temporary suspensions pending
the release of material information and other than a suspension of trading on
the Nasdaq National Market if the Common Stock is listed for trading, and not
suspended, on the Nasdaq SmallCap Market within one Business Day after such
suspension) for more than ten days, at the Purchaser's option exercisable by
written notice to the Company, the Company shall redeem for cash all Shares and
all Underlying Shares then held by such Purchaser, at an aggregate purchase
price equal to (A) the product of the average Per Share Market Value for the
five Trading Days immediately preceding the day of such notice multiplied by the
number of shares of Common Stock into which the Shares to be purchased are then
convertible and exercisable (or in the case of Underlying Shares, the number of
Underlying Shares to be purchased), plus (B) interest on such amount accruing
from the 7th day after such notice at the rate of 15% per annum.
Section 4.17. No Violation of Applicable Law. Notwithstanding any
provision of this Agreement to the contrary, if any redemption of Shares or
Underlying Shares otherwise required under the Transaction Documents or the
Statements of Rights and Preferences would be prohibited by the relevant
provisions of the Massachusetts Business Corporation Law, such redemption shall
be effected as soon as it is permitted under such law; provided, however, that,
interest payable by the Company with respect to any such redemption shall
continue to accrue in accordance with Section 4.16 during any such period.
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Section 4.18. Redemption Restrictions. Notwithstanding any
provision of this Agreement to the contrary, if any redemption of Shares or
Underlying Shares otherwise required under this Agreement would be prohibited in
the absence of consent from any lender of the Company or of any Subsidiary, or
by the holders of any class of securities of the Company, the Company shall use
its best efforts to obtain such consent as promptly as practicable after the
redemption is required but in no event later than 30 days after the redemption
is required. Interest payable by the Company with respect to any such redemption
shall continue to accrue in accordance with Section 4.16 until such consent is
obtained. Nothing contained in this Section shall be construed as a waiver by
the Purchaser of any rights it may have by virtue of any breach of any
representation or warranty of the Company herein as to the absence of any
requirement to obtain any such consent.
Section 4.19. Notice of Breaches. Each of the Company and the
Purchaser shall give prompt written notice to the other of any breach of any
representation, warranty or other agreement contained in the Transaction
Documents, as well as any events or occurrences arising after the date hereof
and prior to the Closing Date, which could reasonably be likely to cause any
representation or warranty or other agreement of such party, as the case may be,
contained herein or therein to be incorrect or breached as of such Closing Date.
However, no disclosure by either party pursuant to this Section shall be deemed
to cure any breach of any representation, warranty or other agreement contained
herein or in the other Transaction Documents. Neither the Company, any
Subsidiary nor the Purchaser will take, or agree to commit to take, any action
that is intended to make any representation or warranty of the Company or the
Purchaser, as the case may be, contained herein or in the other Transaction
Documents or in the Statements of Rights and Preferences inaccurate in any
respect at such Closing Date.
Notwithstanding the generality of the foregoing, the Company shall
promptly notify the Purchaser of any notice or claim (written or oral) that it
receives from any lender of the Company to the effect that the consummation of
the transactions contemplated by the Transaction Documents violates or would
violate any written agreement or understanding between such lender and the
Company, and the Company shall promptly furnish by facsimile to the holders of
the Shares and Warrants a copy of any written statement in support of or
relating to such claim or notice.
Section 4.20. The Warrants.
(a) The Series D Warrants. At the Series D Closing, the Company
shall issue to each Purchaser three Common Stock purchase warrants (the "Series
D Warrants"), in accordance with the following terms: (i) one Series D Warrant
shall entitle the Purchaser to acquire 0.66666 shares of Common Stock for each
share of Preferred Stock being purchased by that Purchaser at a price per share
equal to 125% of the average Per Share Market Value for the ten trading days
immediately preceding the Closing Date (the "Average Price") in accordance with
the terms thereof and shall be exercisable through the date that is three years
after the Closing Date, (ii) one Series D Warrant shall entitle the Purchaser to
acquire 0.66666 shares of Common Stock for each share of Preferred Stock being
purchased by that Purchaser at a price per share equal to 135% of the Average
Price in accordance with the terms thereof and shall be exercisable through the
date that is four years after the Closing Date, and (iii) one Series D Warrant
shall entitle the Purchaser to acquire 1.0 share of Common Stock for each share
of Preferred Stock being purchased by that Purchaser at a price per share equal
to 150% of the Average Price in accordance with the terms thereof and shall be
exercisable through the date that is five years after the Closing Date.
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(b) The Warrants shall be substantially in the form of
Exhibit E.
ARTICLE V
MISCELLANEOUS
Section 5.1. Fees and Expenses. Each party shall pay the fees
and expenses of its advisers, counsel, accountants and other experts, if any,
and all other expenses incurred by such party incident to the negotiation,
preparation, execution, delivery and performance of this Agreement, except as
provided in the Registration Rights Agreement. The Company shall pay all stamp
and other taxes and duties levied in connection with the issuance of the Shares
(and upon conversion thereof, the Underlying Shares) and the Warrants (and upon
exercise thereof, the Warrant Shares) pursuant hereto. The Purchaser shall be
responsible for its own tax liability that may arise as a result of the
investment hereunder or the transactions contemplated by this Agreement. Whether
or not the transactions contemplated by this Agreement are consummated or this
Agreement is terminated, the Company shall pay (i) all costs, expenses, fees and
all taxes incident to and in connection with: (A) the preparation, printing and
distribution of the Disclosure Materials and all amendments and supplements
thereto (including, without limitation, financial statements and exhibits), and
all preliminary and final Blue Sky memoranda and all other agreements,
memoranda, correspondence and other documents prepared and delivered in
connection herewith (B) the issuance and delivery of the Shares and the Warrants
and, upon conversion of the Shares, the Underlying Shares and upon exercise of
the Warrants, the Warrant Shares, (C) the qualification of the Shares and the
Warrants and, upon conversion of the Shares, the Underlying Shares and upon
exercise of the Warrants, the Warrant Shares for offer and sale under the
securities or Blue Sky laws of the several states (including, without
limitation, the fees and disbursements of the Purchasers' counsel relating to
such registration or qualification), (D) furnishing such copies of the
Disclosure Materials and all amendments and supplements thereto, as may
reasonably be requested for use in connection with resales of the Shares and the
Warrants and, upon conversion of the Shares, the Underlying Shares and upon
exercise of the Warrants, the Warrant Shares, and (E) the preparation of
certificates for the Shares and the Warrants and, upon conversion of the Shares,
the Underlying Shares and upon exercise of the Warrants, the Warrant Shares
(including, without limitation, printing and engraving thereof), (ii) all fees
and expenses of the counsel and accountants of the Company and (iii) all
expenses and listing fees in connection with the application for quotation of
the Underlying Shares and the Warrant Shares in the Nasdaq National Market.
Section 5.2. Entire Agreement; Amendments. This Agreement,
together with the Exhibits, and Schedules hereto, and the Registration Rights
Agreement, the Statement of Rights and Preferences and the Warrants contain the
entire understanding of the parties with respect to the subject matter hereof
and supersede all prior agreements and understandings, oral or written, with
respect to such matters.
Section 5.3. Notices. Any notice or other communication required
or permitted to be given hereunder shall be in writing and shall be deemed to
have been received (a) upon hand delivery (receipt acknowledged) or delivery by
telex (with correct answer back received), telecopy or facsimile (with
transmission confirmation report) at the address or number designated below (if
delivered on a Business Day during normal business hours where such notice is to
be received), or the first Business Day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second Business Day following the date of mailing
by express courier service, fully prepaid, addressed to
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such address, or upon actual receipt of such mailing, whichever shall first
occur. The addresses for such communications shall be:
If to the Company: Cayenne Software, Inc.
0 Xxx Xxxxxxx Xxxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Facsimile No.:
Attention: Xxxxxxxxx X. Xxxxxxxx
With copies to: Xxxxx, Xxxx & Xxxxx
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxx
If to a Purchaser: to that Purchaser's address set forth in
Schedule A, with a copy to the
corresponding person and address
designated in that schedule
or such other address as may be designated in writing hereafter, in the same
manner, by such person.
Section 5.4. Amendments; Waivers. No provision of this Agreement
may be waived or amended except in a written instrument signed, in the case of
an amendment, by both the Company and the Purchaser, or, in the case of a
waiver, by the party against whom enforce ment of any such waiver is sought. No
waiver of any default with respect to any provision, condition or requirement of
this Agreement shall be deemed to be a continuing waiver in the future or a
waiver of any other provision, condition or requirement hereof, nor shall any
delay or omission of either party to exercise any right hereunder in any manner
impair the exercise of any such right accruing to it thereafter.
Section 5.5. Headings. The headings herein are for convenience
only, do not constitute a part of this Agreement and shall not be deemed to
limit or affect any of the provisions hereof.
Section 5.6. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties and their successors and
permitted assigns. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the Purchaser. The
Purchaser may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Company, except that the Purchaser may
assign its rights hereunder and under the Transaction Documents without the
consent of the Company as long as the assignee demonstrates to the reasonable
satisfaction of the Company its satisfaction of the representations and
warranties set forth in Section 3.2. This provision shall not limit the
Purchaser's right to transfer securities or transfer or assign rights hereunder
or under the Registration Rights Agreement.
Section 5.7. No Third Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto and their respective permitted
successors and assigns and, other than
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with respect to permitted assignees under Section 5.6, is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.
Section 5.8. Governing Law; Arbitration. (a) This Agreement
shall be governed by and construed and enforced in accordance with the internal
laws of New York without regard to the principles of conflicts of law thereof.
(b) All disputes between the parties hereto arising under
the terms of this Agreement and the other Transaction Documents shall be
arbitrated in New York City under the rules of the American Arbitration
Association then in effect in that city. Judgment on any award made by the
arbitrators hereunder may be rendered in any court having jurisdiction. The
parties consent to the nonexclusive jurisdiction of the United States District
Court sitting in the city where the arbitration was held, in connection with the
enforcement of such award. The parties agree to keep confidential any materials,
documents and other information that is disclosed in connection with any
arbitration proceeding.
Section 5.9. Survival. The representations and warranties of the
Company and the Purchaser contained in Article III and the agreements and
covenants of the parties contained in Article IV and this Article V shall
survive the Closing (or any earlier termination of this Agreement) and any
conversion of Shares and exercise of Warrants hereunder.
Section 5.10. Counterpart Signatures. This Agreement may be
executed in two or more counterparts, all of which when taken together shall be
considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party, it
being understood that both parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission, such signature
shall create a valid and binding obligation of the party executing (or on whose
behalf such signature is executed) the same with the same force and effect as if
such facsimile signature page were an original thereof.
Section 5.11. Publicity. The Company and the Purchaser shall
consult with each other in issuing any press releases or otherwise making public
statements with respect to the transactions contemplated hereby and neither
party shall issue any such press release or otherwise make any such public
statement without the prior written consent of the other, which consent shall
not be unreasonably withheld or delayed, except that no prior consent shall be
required if such disclosure is required by law, in which such case the
disclosing party shall provide the other party with prior notice of such public
statement.
Section 5.12. Severability. In case any one or more of the
provisions of this Agreement shall be invalid or unenforceable in any respect,
the validity and enforceability of the remaining terms and provisions of this
Agreement shall not in any way be affected or impaired thereby and the parties
will attempt to agree upon a valid and enforceable provision which shall be a
reasonable substitute therefor, and upon so agreeing, shall incorporate such
substitute provision in this Agreement.
Section 5.13. Remedies. In addition to being entitled to exercise
all rights provided herein or granted by law, including recovery of damages, the
Purchaser will be entitled to specific performance of the obligations of the
Company under this Agreement and the other Transaction Documents and the Company
will be entitled to specific performance of the obligations of the Purchaser
hereunder with respect to the subsequent transfer of Shares,
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Warrants, Warrant Shares and Underlying Shares. Each of the Company and the
Purchaser agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of any breach of its obligations described in the
foregoing sentence and hereby agrees to waive in any action for specific
performance of any such obligation the defense that a remedy at law would be
adequate.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed as of the date first indicated above.
Company:
CAYENNE SOFTWARE, INC.
By:______________________________________________
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Vice President and Treasurer
Purchasers:
INTEGRAL CAPITAL PARTNERS III, L.P.
By:______________________________________________
Name:
Title:
INTEGRAL CAPITAL PARTNERS
INTERNATIONAL III, L.P.
By:______________________________________________
Name:
Title:
THEMIS PARTNERS, L.P.
By: Promethean Investment Group, L.L.C.
Its: General Partner
By:______________________________________________
Name: Xxxxx X. Xxx
Its: Authorized Representative
HERACLES FUND
By: Promethean Investment Group, L.L.C.
Its: Investment Advisor
By:______________________________________________
Name: Xxxxx X. Xxx
Its: Authorized Representative
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XXXXX X. XXXXXX
By: Promethean Investment Group, L.L.C.
Its: Investment Advisor
By:______________________________________________
Name: Xxxxx X. Xxx
Its: Authorized Representative
QUISSETT PARTNERS, L.P.
By: Wellington Management Company LLP
By:______________________________________________
Name:
Title:
QUISSETT INVESTORS (BERMUDA) LP
By: Wellington Management Company LLP
By:______________________________________________
Name:
Title:
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WINSTON I
By:______________________________________________
Name:
Title:
XXXXXXX XX LLC
By: Chatterjee Advisors LLC
Its: Manager
By:______________________________________________
Name:
Title:
XXXXXXX XX LDC
By:______________________________________________
Name:
Title:
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SCHEDULE A
List of Purchasers
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