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AS EXECUTED SEPTEMBER 30, 1996
Quarterdeck Corporation
and
Xxxxxxxx International Limited
Subscription Agreement
Dated as of September 30, 1996
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SUBSCRIPTION AGREEMENT
This Subscription Agreement (the "Agreement") dated September 30, 1996 is
entered into by and between Quarterdeck Corporation, a Delaware corporation
("Quarterdeck"), and Xxxxxxxx International Limited, a company organized under
the laws of the Cayman Islands ("Xxxxxxxx").
Unless otherwise defined herein, capitalized terms used herein and not defined
herein shall have the meanings given to them in Regulation S ("Regulation S")
under the United States Securities Act of 1933, as amended (the "Securities
Act").
The parties hereto agree as follows:
1. Purchase and Sale. In consideration of and upon the
basis of the representations, warranties and agreements and subject to the
terms and conditions set forth in this Agreement:
a. Preferred Stock. Quarterdeck agrees to sell to
Xxxxxxxx, and Xxxxxxxx agrees to purchase from Quarterdeck, on the
Closing Date specified in Section 2 hereof, 200,000 shares of
Preferred Stock, stated value $100.00 per share, having the terms and
conditions set forth in Annex A hereto (the "Preferred Shares") at a
purchase price per share equal to the stated value thereof.
b. Warrant. Quarterdeck agrees to sell to Xxxxxxxx,
and Xxxxxxxx agrees to purchase from Quarterdeck, on the Closing Date
specified in Section 2 hereof, a warrant having the terms set forth in
Annex B hereto (the "Warrant") to purchase shares of Quarterdeck's
Common Stock, par value $0.001 per share (the "Common Stock"), which,
in accordance with the terms and conditions of this Agreement, will be
freely tradable. The shares of Common Stock issuable pursuant to the
Warrant are referred to herein as the "Warrant Shares."
2. Closing Date. The delivery of the Preferred Stock
referred to in Section 1(a) and the Warrant referred to in Section 1(b) (the
"Closing") shall take place at 1:00 p.m. (New York time) on September 30 1996,
or at such other date and time as Xxxxxxxx and Quarterdeck may agree in writing
(such date and time being referred to herein as the "Closing Date").
On the Closing Date, the following deliveries shall be made:
a. Preferred Shares. Quarterdeck shall deliver the
certificate representing the Preferred Shares, duly registered on the
books of Quarterdeck in the name of Xxxxxxxx, against payment by
Xxxxxxxx of the purchase price specified in Section 1(a) hereof in
immediately available funds to the following account:
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Quarterdeck Corporation, Xxxxx Fargo Bank, Account No. 4159378132 ABA
# 000000000.
b. Warrant. Quarterdeck shall deliver the
certificate representing the Warrant to Xxxxxxxx. Such certificate
shall be substantially in the form attached hereto as Annex B.
c. Officers' Certificate. The officers' certificates
required by Sections 8(a) and 9(a) shall be delivered to Xxxxxxxx and
Quarterdeck, respectively.
d. Legal Opinions. The legal opinions required by
Sections 8(b) and 9(b) shall be delivered to Xxxxxxxx and Quarterdeck,
respectively.
The foregoing deliveries shall be deemed to occur
simultaneously as part of a single transaction, and no delivery shall be deemed
to have been made until all such deliveries have been made.
3. Representations and Warranties of Quarterdeck.
Quarterdeck hereby represents and warrants to Xxxxxxxx on the date hereof, on
the Closing Date, on the date any Preferred Share is converted (each a
"Conversion Date") and on each Warrant Exercise Date (as defined in Annex B
hereto) as follows:
a. Quarterdeck has been duly incorporated and is
validly existing in good standing under the laws of Delaware.
b. This Agreement has been duly authorized,
executed and delivered by Quarterdeck and, when duly authorized,
executed and delivered by Xxxxxxxx, will be a valid and binding
agreement enforceable against Quarterdeck 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.
c. Quarterdeck has full corporate power and
authority necessary to enter into this Agreement and to perform its
obligations hereunder.
d. Assuming the accuracy of the representations
and warranties of Xxxxxxxx herein made as of such date, no consent,
approval, authorization or order of any court, governmental agency or
other body is required for the execution by Quarterdeck of this
Agreement or the performance by Quarterdeck of any of its obligations
hereunder, other than such as have been obtained.
e. Except as set forth in Schedule 3(e) herein,
neither the execution by Quarterdeck of this Agreement nor the
performance by Quarterdeck of any of its obligations hereunder will:
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(1) violate, conflict with, result in a
breach of, or constitute a default (or an event which with the
giving of notice or the lapse of time or both would be
reasonably likely to constitute a default) under (A) the
Certificate of Incorporation or by-laws of Quarterdeck or any
of its subsidiaries, (B) any decree, judgment, order, law,
treaty, rule, regulation or determination applicable to
Quarterdeck of which Quarterdeck is aware (after due inquiry)
of any court, governmental agency or body, or arbitrator
having jurisdiction over Quarterdeck or any of its
subsidiaries or any of their respective properties or assets,
(C) the terms of any material bond, debenture, note or any
other evidence of indebtedness, or any material agreement,
stock option or other similar plan, indenture, lease,
mortgage, deed of trust or other instrument to which
Quarterdeck or any of its subsidiaries is a party, by which
Quarterdeck or any of its subsidiaries is bound, or to which
any of the properties or assets of Quarterdeck or any of its
subsidiaries is subject, or (D) the terms of any "lock-up" or
similar provision of any underwriting or similar agreement to
which Quarterdeck or any of its subsidiaries is a party; or
(2) result in the creation or imposition
of any lien, charge or encumbrance upon (A) any Preferred
Share, the Warrant or any Common Stock or (B) any of the
properties or assets of Quarterdeck or any of its
subsidiaries.
f. When issued to Xxxxxxxx against payment
therefor in accordance with the terms of this Agreement, any Preferred
Share or the Warrant, each share of Common Stock:
(1) will have been duly and validly
authorized, duly and validly issued, fully paid and
non-assessable;
(2) will be free and clear of any
security interests, liens, claims or other encumbrances; and
(3) will not have been issued or sold in
violation of any preemptive or other similar rights of the
holders of any securities of Quarterdeck.
g. When any share of Common Stock is issued to
Xxxxxxxx pursuant to the terms of this Agreement, any Preferred Share
or the Warrant, the Common Stock will be quoted on the Nasdaq National
Market ("NASDAQ") or listed and registered on a national securities
exchange (as defined in the United States Securities Exchange Act of
1934, as amended (the "Exchange Act")).
h. Quarterdeck is a Reporting Issuer within the
meaning of Regulation S.
i. There is no pending or, to the best knowledge
of Quarterdeck,
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threatened action, suit, proceeding or investigation before any court,
governmental agency or body, or arbitrator having jurisdiction over
Quarterdeck or any of its affiliates that would materially affect the
execution by Quarterdeck of, or the performance by Quarterdeck of its
obligations under, this Agreement, provided, however, that the
representations and warranties contained in this Section 3(i) shall
not apply to any action, threatened action, suit, proceeding or
investigation initiated by Xxxxxxxx and shall not be required to be
given in respect of any Conversion Date or Warrant Exercise Date.
j. None of Quarterdeck's filings with the United
States Securities and Exchange Commission (the "SEC") under the
Securities Act or under Section 13(a) or 15(d) of the Exchange Act
(each, an "SEC Filing"), as of their respective dates, contain any
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements, in the light of the
circumstances under which they were made, not misleading.
k. Except as previously disclosed to Xxxxxxxx,
since the date of Quarterdeck's most recent SEC Filing, there has not
been, and Quarterdeck is not aware of any development that might
result in, any material adverse change in the condition, financial or
otherwise, or in the business affairs or business prospects of
Quarterdeck, whether or not arising in the ordinary course of
business, except as disclosed in such SEC Filing, provided, however,
that the representations and warranties contained in this Section 3(k)
shall not to be required to be given in respect of any Conversion Date
or Warrant Exercise Date.
l. The offer and sale of the Preferred Shares,
the Common Stock, the Warrant and the Warrant Shares to Xxxxxxxx
pursuant to this Agreement will, subject to compliance by Xxxxxxxx
with the applicable representations and warranties contained in
Section 4 hereof and with the applicable covenants and agreements
contained in Section 6 hereof, be made in accordance with the
provisions and requirements of Regulation S and any applicable state
law.
m. Neither Quarterdeck nor any of its affiliates
nor any person acting on its or their behalf has engaged or will
engage in any Directed Selling Efforts with respect to the Preferred
Shares, the Common Stock, the Warrant or the Warrant Shares, and all
such persons understand and have complied and will otherwise comply
with the requirements of Regulation S.
n. The transactions contemplated by this
Agreement are not part of a plan or scheme on the part of Quarterdeck,
any of its affiliates or any person acting on its or their behalf to
evade the registration provisions of the Securities Act.
o. Quarterdeck has not issued, and after the
Agreement Date will not issue, any stop transfer order or other order
impeding the sale and delivery of the
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Preferred Shares, the Common Stock, the Warrant or the Warrant Shares
issuable hereunder except for a stop order restricting the sale of any
of the foregoing securities to any person in the United States or to or
for the account or benefit of any U.S. person during an applicable
Restricted Period or otherwise not in compliance with Regulation S.
Notwithstanding the foregoing provision, Quarterdeck shall place the
following legend on the certificate representing any security issued
hereunder prior to the expiration of the Restricted Period (as defined
herein) applicable to such security:
The securities represented by this certificate were issued on
[insert original issue date] (the "Original Issue Date")
pursuant to the Subscription Agreement dated September 30,
1996 between Quarterdeck Corporation ("Quarterdeck") and
Xxxxxxxx International Limited. The securities represented by
this certificate have not been registered under the Securities
Act of 1933, as amended (the "Securities Act"), and have been
sold in reliance on the exemption from registration provided
by Regulation S under the Securities Act ("Regulation S").
Prior to the expiration of a 40-day restricted period
beginning on the Original Issue Date (the "Restricted
Period"), the securities represented by this certificate may
not be offered or sold, directly or indirectly, within the
United States (as defined in Regulation S under the Act), to a
U.S. Person (as defined in Regulation S under the Act) or for
the account or benefit of a U.S. Person. Neither Quarterdeck
nor its transfer agent shall be obligated to remove this
legend unless it shall have received an opinion of counsel
stating that such removal complies with the requirements of
Regulation S.
provided, however, that as used in this Agreement and as reflected in
such legend, the term "Restricted Period," with respect to any
security, shall mean the Restricted Period then applicable to such
security pursuant to Regulation S (or any applicable successor
thereto).
p. Neither Quarterdeck nor any of its affiliates
has offered to sell or sold any Common Stock or any securities
convertible or exchangeable into or exercisable for Common Stock in
reliance upon Regulation S at any time during the 12 months prior the
date of this Agreement; and there are no such outstanding convertible
or exchangeable securities that have been offered or sold in reliance
upon Regulation S, except, in each case the Warrant and the Preferred
Shares sold pursuant hereto.
4. Representations and Warranties of Xxxxxxxx. Xxxxxxxx
hereby represents and warrants to Quarterdeck as follows:
x. Xxxxxxxx has been duly incorporated and is
validly existing in good standing under the laws of the Cayman
Islands.
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b. This Agreement has been duly authorized,
executed and delivered by Xxxxxxxx and, when duly authorized, executed
and delivered by Quarterdeck, will be a valid and binding agreement
enforceable against Xxxxxxxx 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.
c. Assuming the accuracy of the representations
and warranties of Quarterdeck herein made as of such date, no consent,
approval, authorization or order of any court, governmental agency or
other body is required for the execution by Xxxxxxxx of this Agreement
or the performance by Xxxxxxxx of any of its obligations hereunder,
other than such as have been obtained.
d. Neither the execution by Xxxxxxxx of this
Agreement nor the performance by Xxxxxxxx of any of its obligations
hereunder will violate, conflict with, result in a breach of, or
constitute a default (or an event which with the giving of notice or
the lapse of time or both would be reasonably likely to constitute a
default) under the Memorandum or Articles of Association or any other
constitutive document of Xxxxxxxx or any of its subsidiaries.
x. Xxxxxxxx understands that no United States
federal or state agency has passed on, reviewed or made any
recommendation or endorsement of the Preferred Shares, the Common
Stock, the Warrant or the Warrant Shares;
f. In making the decision to purchase the
Preferred Shares, the Common Stock, the Warrant and the Warrant Shares
in accordance with this Agreement, Xxxxxxxx has relied solely upon
independent investigations made by it and not upon any representations
made by Quarterdeck other than those made pursuant to this Agreement.
x. Xxxxxxxx understands that the Preferred
Shares, the Common Stock, the Warrant and the Warrant Shares have not
been and will not be registered under the Securities Act and may not
be reoffered or resold other than pursuant to such registration or an
available exemption therefrom.
x. Xxxxxxxx is not a U.S. Person and is not
acquiring the Preferred Shares, the Common Stock, the Warrant or any
Warrant Shares for the account or benefit of any U.S. Person, and
Xxxxxxxx is not an affiliate (within the meaning of Rule 144 under the
Securities Act) of Quarterdeck.
i. At the time the buy orders for the Preferred
Shares and the Warrant (and any Common Stock and Warrant Shares issued
during the applicable Restricted Period) were originated, Xxxxxxxx was
located outside the United States.
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j. Neither Xxxxxxxx nor any of its affiliates
nor anyone acting on its or their behalf has engaged or will engage in
any Directed Selling Efforts with respect to the Preferred Shares, the
Common Stock, the Warrant or any Warrant Shares, and all such persons
understand and have complied and will otherwise comply with the
requirements of Regulation X.
x. Xxxxxxxx:
(1) will not, during the Restricted
Period applicable to the Preferred Shares, the Common Stock,
the Warrant and the Warrant Shares, offer or sell any of the
foregoing securities (or create or maintain any derivative
position equivalent thereto) in the United States, to or for
the account or benefit of a U.S. Person or other than in
accordance with Regulation S. Without limiting the foregoing,
Xxxxxxxx covenants that neither it nor any of its affiliates
nor any person acting on its or their behalf, will enter into
or maintain, during any applicable Restricted Period, any put
option, short position or similar instrument or position with
respect to Quarterdeck's Common Stock or securities of the
same class as, or convertible or exchangeable into, such
Common Stock; and
(2) will, after the expiration of the
applicable Restricted Period, offer, sell, pledge or otherwise
transfer the Preferred Shares, the Common Stock, the Warrant
or any Warrant Shares (or create or maintain any derivative
position equivalent thereto) only pursuant to registration
under the Securities Act or an available exemption therefrom
and, in any case, in accordance with applicable state
securities laws.
x. Xxxxxxxx is purchasing the Preferred Shares,
the Warrant and the Warrant Shares for its own account, for the
purpose of investment and not with a view to a distribution thereof.
m. The transactions contemplated by this
Agreement are not part of a plan or scheme on the part of Xxxxxxxx,
any of its affiliates or any person acting on its or their behalf to
evade the registration requirements of the Securities Act.
n. As of the date of this Agreement, prior to
the consummation of the transactions contemplated hereby, neither
Xxxxxxxx nor any of its affiliates is the owner, directly or
indirectly, of any Common Stock of Quarterdeck.
5. Covenants of Quarterdeck. Quarterdeck covenants and
agrees with Xxxxxxxx as follows:
a. For so long as any Preferred Share is
outstanding or any portion of the Warrant remains outstanding, and in
either case for a period of 40 days thereafter, Quarterdeck will
continue to be a Reporting Issuer within the meaning of
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Regulation S and will maintain the eligibility of the Common Stock for
quotation on NASDAQ or listing on a national securities exchange (as
defined in the Exchange Act).
b. For so long as any Preferred Share is
outstanding or any portion of the Warrant remains outstanding, and in
either case for a period of 40 days thereafter, neither Quarterdeck
nor any of its affiliates nor any person acting on its or their behalf
will engage in any Directed Selling Efforts with respect to the
Preferred Shares, the Warrant, or the Common Stock issuable pursuant
to this Agreement. Without limiting the generality of the foregoing,
Quarterdeck agrees that, to the extent it or any of its affiliates or
any person acting on its or their behalf issues a press release or
similar written public statement that includes any reference to the
transactions contemplated by this Agreement, such press release or
other similar public written statement shall not be issued solely with
respect to the transactions contemplated by this Agreement, such
reference shall not include any reference to Xxxxxxxx or Regulation S,
and Quarterdeck shall provide Xxxxxxxx and Xxxxxx & Xxxxx the right to
review and approve such press release prior to dissemination.
c. For so long as any Preferred Share is
outstanding or any portion of the Warrant remains outstanding, and in
either case for a period of 40 days thereafter, Quarterdeck will
ensure that all applicable Offering Restrictions with respect to the
Preferred Shares, the Common Stock issuable pursuant to this
Agreement, the Warrant and the Warrant Shares are thoroughly complied
with and satisfied.
d. At any time after the expiration of any
Restricted Period with respect to the Preferred Shares, the Common
Stock, the Warrant or any Warrant Shares, upon the request of Xxxxxxxx
accompanied by an opinion of Xxxxxx & Xxxxx (or such other counsel as
shall be reasonably satisfactory to Quarterdeck and its transfer agent
(if any)) to the effect that the removal of the legend referred to in
Section 3(o) would then be permitted under Regulation S and that the
resale of any such security would not require registration under the
Securities Act, Quarterdeck shall, or shall cause its transfer agent
(if any) to, accept from Xxxxxxxx the legended certificates
representing such securities and deliver in their place unlegended
certificates therefor.
e. Quarterdeck will comply with the terms and
conditions of the Preferred Stock and the Warrant as set forth in
Annex B hereto, (as duly amended from time to time by the parties
hereto), and when issued, each Preferred Share will be substantially
in the form of Annex A hereto.
f. Except as provided in the following sentence,
so long as any Preferred Share is outstanding or any portion of the
Warrant remains outstanding, Quarterdeck shall at all times reserve
and keep available, free from pre-emptive rights, out of its
authorized but unissued Common Stock, for issuance upon conversion of
such Preferred Shares and exercise of such Warrant, the maximum number
of shares of Common Stock then so issuable. Notwithstanding the
preceding sentence, until the earlier of (i) the Business Day
immediately following the date of Quarterdeck's 1997
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Annual Meeting of Stockholders and (ii) February 15, 1997, Quarterdeck
shall at all times reserve and keep available, free from pre- emptive
rights, out of its authorized but unissued Common Stock, for issuance
upon conversion of Preferred Shares and exercise of Warrants, not less
than 4,400,000 shares of Common Stock.
g. For a period of six months from the Closing
Date, Quarterdeck will not offer or sell any of its or its affiliates'
securities pursuant to Regulation S.
h. For a period of one year following the
Closing Date, Quarterdeck will not offer to sell to any person any of
its or its subsidiaries' Common Stock (or any securities convertible
into or exchangeable for such common stock) (other than a sale of 50%
or more of the outstanding common stock of a subsidiary) in reliance
upon Section 4(2) of the Securities Act, or Regulation D promulgated
thereunder, unless Quarterdeck shall have (1) given Xxxxxxxx written
notice of its intention to make such offer and (2) offered to sell
such securities to Xxxxxxxx at least 5 Business Days prior to the date
on which, and on the same terms and conditions as, such securities are
offered to any such other person. In any event, Xxxxxxxx shall be
entitled, but not obligated, to participate in any such Equity Private
Placement on the same terms as other purchasers, to the extent
necessary to maintain Xxxxxxxx'x pro rata ownership of Quarterdeck
Common Stock (including its ownership of shares of Common Stock and
its equivalent ownership of Preferred Shares and Warrant Shares)
immediately prior to the closing of such Equity Private Placement;
provided, however, that Xxxxxxxx provides written notification to
Quarterdeck of its commitment to so participate not later than 5
Business Days after such securities were offered to Xxxxxxxx pursuant
to clause (2) of this Section 5(h). Notwithstanding the above, the
restrictions in Sections 5(g) and 5(h) will not apply to the extent
that any issuance of securities is not a capital-raising transaction.
i. Quarterdeck will furnish promptly to Xxxxxxxx
any information that it files with the SEC or to NASDAQ.
j. Notwithstanding any other provision of this
Agreement, for so long as any Preferred Share or portion of the
Warrant remains outstanding, if on any Conversion Date or Warrant
Exercise Date (for purposes of this Section 5(l), a "Limitation Date")
(i) prior to the earlier of February 15, 1997 or the date of
Quarterdeck's 1997 Annual Meeting of Stockholders, the number of
shares of Common Stock issuable upon such Conversion Date or Warrant
Exercise Date shall exceed the number of authorized but unissued
shares of Common Stock not reserved for other issuances, Quarterdeck
shall seek stockholder approval to amend its Certificate of
Incorporation to increase the authorized number of shares of Common
Stock, or (ii) at any time after the date of this Agreement, Rule
4460(i)(1)(D) (or any applicable successor provision) of the National
Association of Securities Dealers, Inc. would require the approval of
the stockholders of Quarterdeck for the issuance of any shares of
Common Stock to Xxxxxxxx pursuant to this Agreement, then (a)
Quarterdeck shall immediately take such action as may be required to
obtain such stockholder approval as
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promptly as practicable and shall continue to use its best efforts to
obtain such approval until such approval has been obtained or is no
longer required, (b) until such stockholder approval has been obtained
or is no longer required, no Preferred Shares may be converted and the
Warrant may not be exercised by Xxxxxxxx and (c) if such stockholder
approval shall not have been obtained within (i) 90 days after such
Limitation Date, if Quarterdeck's proxy solicitation materials are not
subjected to SEC review, and (ii) 120 days after such Limitation Date,
if Quarterdeck's proxy solicitation materials are subjected to SEC
review, then as soon as the same is permitted pursuant to the
Restrictive Agreements (as defined in Schedule 3(e) hereto), but not
later than September 30, 2001, and to the extent permitted by
applicable law, on each subsequent Warrant Exercise Date (x) if the
applicable Exercise Price is less than the volume-weighted average
price of the Common Stock on such date, then such Exercise Price shall
be reduced by an amount which, when multiplied by the Maximum Warrant
Amount (as defined in the Warrant) on such date, is equal to (1) the
stated value of such Preferred Shares as may not be so converted times
(2) the rate of 10% per annum, accrued from and including such
Limitation Date or the immediately preceding Warrant Exercise Date, as
the case may be, to but excluding the earlier of the date on which
such stockholder approval has been obtained or is no longer required
and such Warrant Exercise Date, and (y) if the applicable Exercise
Price is equal to or greater than the volume-weighted average price of
the Common Stock on such date, then the Exercise Price shall be
reduced in accordance with the following sentence such that the
increase in the Black-Scholes value of the Warrant as a result of such
reduction is equal to (1) the stated value of such Preferred Shares as
may not be so converted times (2) the rate of 10% per annum, accrued
from and including such Limitation Date or the immediately preceding
Warrant Exercise Date, as the case may be, to but excluding the
earlier of the date on which such stockholder approval has been
obtained or is no longer required and such Warrant Exercise Date.
6. Covenants of Xxxxxxxx. Xxxxxxxx hereby covenants and
agrees with Quarterdeck as follows:
a. During any Restricted Period applicable to
the Preferred Shares, the Common Stock, the Warrant or the Warrant
Shares, neither Xxxxxxxx nor any of its affiliates nor any person
acting on its or their behalf will:
(1) offer or sell such Preferred Shares,
Common Stock, Warrant or Warrant Shares other than in an
Offshore Transaction;
(2) engage in any Directed Selling
Efforts with respect to such Preferred Shares, Common Stock,
Warrant or Warrant Shares;
(3) offer or sell such Preferred Shares,
Common Stock, Warrant or Warrant Shares other than: (A) in
accordance with Rule 903 or Rule 904 of Regulation S; (B)
pursuant to registration under the Securities Act or (C)
pursuant to an available exemption therefrom; and
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(4) offer or sell such Preferred Shares,
Common Stock, Warrant or Warrant Shares to any U.S. Person or
for the account or benefit of any U.S. Person.
x. Xxxxxxxx will not engage in short-selling of
Quarterdeck Common Stock during the seven-month period following the
Closing Date or during any Pricing Period (as defined in Annex A
hereto).
7. Registration Rights.
(a) If, at any time after the date hereof, the SEC has
reinterpreted Regulation S or has promulgated, or the United States
Congress has legislated, a successor or revision to Regulation S, and
such reinterpretation, successor provision or revision imposes a
Restricted Period applicable to any security issued or issuable
hereunder that is greater than that in effect on the date of this
Agreement, or would materially impair the ability of Xxxxxxxx or any of
its affiliates (as defined in Rule 144(a) under the Securities Act) to
offer, sell or otherwise dispose of any such security pursuant to
Regulation S as contemplated hereby, or requires any such offer, sale
or other disposition to be registered under the Securities Act, then
upon the written request of Xxxxxxxx (a "Registration Request"),
Quarterdeck shall, as promptly as practicable thereafter and at its own
expense, file a registration statement on Form S-3 (the "Registration
Statement") under the Securities Act covering the sale or resale of all
such securities (each a "Covered Security") and shall use its best
efforts to cause such Registration Statement to be declared effective;
provided, however, that Quarterdeck shall not be required to file a
Registration Statement or comply with any other obligations arising
under this Section 7 if the limitations imposed by any such
reinterpretation, successor provision or revision are imposed solely as
a result of actions taken or omitted to be taken by Xxxxxxxx. Xxxxxxxx
acknowledges and agrees that Quarterdeck has granted to other holders
of Quarterdeck securities certain registration rights that would permit
such holders to include such securities in the Registration Statement
in accordance with the terms of the various agreements governing such
registration rights. Xxxxxxxx further acknowledges and agrees that (i)
it shall not be entitled to participate in a demand registration
requested by the holders of Quarterdeck's 6% Convertible Senior
Subordinated Notes (the "Notes") and (ii) upon the request of Xxxxxxxx
and with the consent of Quarterdeck (such consent not to be
unreasonably withheld) the Registration Statement shall cover an
underwritten offering of the Covered Securities, the holders of the
Notes shall be entitled to include in the Registration Statement shares
of Common Stock issuable in accordance with the terms of the Notes,
subordinate to the rights of Xxxxxxxx, if, in the opinion of the
managing underwriter, such shares may be included in such registration
without having an adverse effect on the marketability or the price of
the Covered Securities. Upon the effectiveness of such Registration
Statement (A) Quarterdeck shall issue such Covered Securities to
Xxxxxxxx in accordance with the terms hereof and (B) the provisions of
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Sections 3(l), (m), (o) and (p), 4(e), (f), (g), (h), (i) and (j),
5(a), (b), (c) and (d), 6 (collectively, the "Specified Provisions"),
8(a) and (b) (to the extent applicable to the Specified Provisions),
9(b), (c) and (d) (to the extent applicable to the Specified
Provisions) shall thereafter be of no force and effect with respect to
the issuance of such Covered Securities; provided, however, that, if
such Registration Statement has not been declared effective before the
180th day following the date of such Registration Request, if such
Registration Statement is subjected to review by the SEC, Quarterdeck
shall continue to use its best efforts to cause such Registration
Statement to be declared effective, and provided, further, however,
that as soon as the same is permitted pursuant to the Restrictive
Agreements, but not later than September 30, 2001. Quarterdeck shall,
to the extent permitted by applicable law, repurchase such Covered
Securities as may not be resold in the United States without
restriction pursuant to the Securities Act for cash in an amount
equal to (i) the per share liquidation value of the Preferred Shares,
(ii) the market value of the Common Stock acquired upon conversion of
the Preferred Shares or exercise of the Warrant, based on the average
of the daily volume weighted average prices of the Common Stock for
the ten Trading Days prior to September 30, 2001, as reported by
Bloomberg L.P. or, if Bloomberg L.P. is not then publishing such
reports, as reported by such service as is mutually agreed upon by
Quarterdeck and Xxxxxxxx (the "Common Stock Market Value"), and (iii)
the Common Stock Market Value of the Warrant Shares into which the
Warrant is then convertible, as the case may be. As used herein, the
term "Trading Day" means any day on which Quarterdeck's Common Stock
is quoted on NASDAQ or such other national securities exchange on
which the Common Stock is then traded.
(b) In the case of the registration effected by
Quarterdeck pursuant to this Section 7, Quarterdeck will use its best
efforts to: (i) keep such registration effective until the earlier of
(A) the second anniversary of the issuance of each Covered Security,
(B) such date as all of the Covered Securities have been sold by
Xxxxxxxx or (C) such time as all of the Covered Securities held by
Xxxxxxxx can be sold by Xxxxxxxx or any of its affiliates (within the
meaning of Rule 144(a) under the Securities Act) within a given
three-month period without compliance with the registration
requirements of the Securities Act pursuant to Rule 144 under the
Securities Act ("Rule 144"); (ii) prepare and file with the SEC such
amendments and supplements to the Registration Statement and the
prospectus used in connection with the Registration Statement (as so
amended and supplemented from time to time, the "Prospectus") as may
be necessary to comply with the provisions of the Securities Act with
respect to the disposition of all Covered Securities by Xxxxxxxx or
any of its affiliates (within the meaning of Rule 144(a) under the
Securities Act); (iii) furnish such number of Prospectuses and other
documents incident thereto, including any amendment of or supplement
to the Prospectus, as Xxxxxxxx from time to time may reasonably
request; (iv) cause all Covered Securities that are Common Stock to be
listed on each securities exchange and quoted on each quotation
service on which similar securities issued by Quarterdeck are then
listed or quoted; (v) provide a transfer agent and registrar for all
Covered Securities and a CUSIP number for all Covered Securities; (vi)
otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC; and (vii)
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file the documents required of Quarterdeck and otherwise use its best
efforts to obtain and maintain requisite blue sky clearance in (A) all
jurisdictions in which any of the Covered Securities are originally
sold and (B) all other states specified in writing by Xxxxxxxx,
provided that Quarterdeck shall not be required to qualify to do
business or consent to service of process or subject itself to
taxation in any state in which it is not now so qualified or has not
so consented.
(c) Quarterdeck shall furnish to Xxxxxxxx upon
request a reasonable number of copies of a supplement to or an
amendment of such Prospectus as may be necessary in order to
facilitate the public sale or other disposition of all or any of the
Covered Securities by Xxxxxxxx or any of its affiliates (within the
meaning of Rule 144(a) under the Securities Act); pursuant to the
Registration Statement.
(d) With a view to making available to Xxxxxxxx
and its affiliates (within the meaning of Rule 144(a) under the
Securities Act) the benefits of Rule 144 and Form S-3 under the
Securities Act, Quarterdeck covenants and agrees to: (i) make and keep
available adequate current public information (within the meaning of
Rule 144(c)) concerning Quarterdeck, until the earlier of (A) the
second anniversary of the issuance of each Covered Security or (B)
such date as all of the Covered Securities shall have been resold by
Xxxxxxxx or any of its affiliates (within the meaning of Rule 144(a)
under the Securities Act); (ii) maintain its status as a Reporting
Issuer and file with the SEC in a timely manner all reports and other
documents required of Quarterdeck for use of Form S-3; and (iii)
furnish to Xxxxxxxx upon request, as long as Xxxxxxxx owns any Covered
Securities, (A) a written statement by Quarterdeck that it has
complied with the reporting requirements of the Securities Act and the
Exchange Act, (B) a copy of the most recent annual or quarterly report
of Quarterdeck, and (C) such other information as may be reasonably
requested in order to avail Xxxxxxxx and its affiliates (within the
meaning of Rule 144(a) under the Securities Act) of Rule 144 or Form
S-3 with respect to such Covered Securities.
(e) Notwithstanding anything else in this Section
7, if, at any time during which a Prospectus is required to be
delivered in connection with the sale of any Covered Securities, if a
Blackout Event (as defined below) exists, Quarterdeck will, as
promptly as practicable, notify Xxxxxxxx thereof by telephone and in
writing. Upon receipt of such notification, Xxxxxxxx and its
affiliates (within the meaning of Rule 144(a) under the Securities
Act) will immediately suspend all offers and sales of any Covered
Securities pursuant to the Registration Statement (the period of such
suspension being referred to herein as a "Blackout Period"). A
"Blackout Event" shall exist at such times (i) that Quarterdeck is not
eligible to use Form S-3 for the registration contemplated by this
Section 7, or (ii) as circumstances exist that Quarterdeck determines
in good faith make it impractical or inadvisable for Quarterdeck to
amend or supplement the Registration Statement or the Prospectus or to
cause the Registration Statement or the Prospectus to become or remain
effective (such circumstances to include, without limitation, (A)
Quarterdeck conducting an underwritten primary offering and being
advised by the underwriters that sale of
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Covered Securities under the Registration Statement would have a
material adverse effect on such underwritten primary offering or (B)
pending negotiations relating to, or consummation of, a transaction or
the occurrence of some other event (x) where any of the foregoing
would require disclosure under applicable securities laws of material
information in the Registration Statement (or any other document
incorporated by reference into the Registration Statement) or state
securities filings and (y) as to which Quarterdeck has a bona fide
business purpose for preserving confidentially). Quarterdeck will
promptly notify Xxxxxxxx after it has determined in good faith that
such sales have become permissible in such manner and will promptly
deliver copies of the Registration Statement and the Prospectus (as so
amended or supplemented) to Xxxxxxxx in accordance with paragraph (ii)
of this Section 7. Notwithstanding the foregoing, (i) in no
circumstances shall Quarterdeck impose more than two Blackout Periods
of up to thirty days each or one Blackout Period of up to sixty days
during any twelve-month period and (ii) in no circumstances shall any
Blackout Period commence less than thirty days following the end of
the previous Blackout Period.
Upon the commencement of a Blackout Period pursuant to this
Section 7, Xxxxxxxx will immediately notify Quarterdeck of any
contracts to sell any Covered Securities (each a "Sales Contract")
that Xxxxxxxx or any of its affiliates (within the meaning of Rule
144(a) under the Securities Act) has entered into prior to the
commencement of such Blackout Period and that would require delivery
of such Covered Securities during such Blackout Period, which notice
will contain the aggregate sale price and volume of Covered Securities
pursuant to such Sales Contract. Upon receipt of such notice,
Quarterdeck will immediately notify Xxxxxxxx of its election either
(i) to terminate the Blackout Period and, as promptly as practicable,
amend or supplement the Registration Statement or the Prospectus in
order to correct the material misstatement or omission or otherwise to
comply with the Securities Act and deliver to Xxxxxxxx copies of such
amended or supplemented Registration Statement and Prospectus in
accordance with paragraph (ii) of this Section 7 or (ii) to continue
the Blackout Period in accordance with this paragraph. If Quarterdeck
elects to continue the Blackout Period, and Xxxxxxxx or any of its
affiliates (within the meaning of Rule 144(a) under the Securities
Act) is therefore unable to consummate the sale of Covered Securities
pursuant to the Sales Contract (such unsold Covered Securities being
hereinafter referred to herein as the "Unsold Securities"),
Quarterdeck will promptly indemnify each Xxxxxxxx Indemnified Party
(as such term is defined in Section 12(a) below) against any
Proceeding (as such term is defined in Section 12(a) below) that each
Xxxxxxxx Indemnified Party may incur arising out of or in connection
with Xxxxxxxx'x breach or alleged breach of any such Sales Contract,
and Quarterdeck shall reimburse each Xxxxxxxx Indemnified Party for
any reasonable costs or expenses (including reasonable legal fees)
incurred by such party in investigating or defending any such
Proceeding (collectively, the "Indemnification Amount"); provided,
however, that each Xxxxxxxx Indemnified Party shall take all actions
reasonably necessary or appropriate to mitigate such Indemnification
Amount; and provided further, however, that the Indemnification Amount
shall be reduced by an amount equal to the number of Unsold Securities
multiplied by the difference between (x) the actual per share price
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received by Xxxxxxxx or any of its affiliates (within the meaning of
Rule 144(a) under the Securities Act) upon the sale of the Unsold
Securities (if such sale occurs within three Trading Days of the end
of the Blackout Period) or the closing sale price of the Common Stock
on NASDAQ or other national securities exchange on which the Common
Stock is then listed on the third Trading Day after the end of the
Blackout Period (if the Unsold Securities are not sold by Xxxxxxxx or
any of its affiliates (within the meaning of Rule 144(a) under the
Securities Act) within three Trading Days of the end of the Blackout
Period), and (y) the per share sale price for the Unsold Securities
provided in the Sales Contract.
8. Conditions Precedent to Xxxxxxxx'x Obligations. The
obligations of Xxxxxxxx hereunder are subject to the performance by Quarterdeck
of its obligations hereunder and to the satisfaction of the following
additional conditions precedent:
a. The representations and warranties made by
Quarterdeck in this Agreement shall, unless expressly waived in
writing by Xxxxxxxx, be true and correct as of the date hereof, on the
Agreement Date, on each Conversion Date and on each Warrant Exercise
Date (as defined in Annex B hereto), and Xxxxxxxx shall have received
on each such date a certificate of the Chief Executive Officer and the
Chief Financial Officer of Quarterdeck dated such date and to such
effect.
b. On the Closing Date and on each Conversion
Date in respect of the issuance of at least 175,000 shares of Common
Stock and each Warrant Exercise Date (as defined in Annex B hereto) in
respect of the issuance of at least 175,000 Warrant Shares Quarterdeck
shall have delivered to Xxxxxxxx an opinion of counsel reasonably
satisfactory to Xxxxxxxx, dated the date of delivery, confirming in
substance the matters covered in paragraphs (a), (b), (c), (d), (e),
(f), (g), (h) and (i) of Section 3 hereof; provided, however, that no
such opinion delivered in respect of any Conversion Date or Warrant
Exercise Date shall be required to cover the matters set forth in
paragraph (i) of Section 3 hereof.
As used herein the term "Business Day" means any day on which
banks in The City of New York are open for business.
9. Conditions Precedent to Quarterdeck's Obligations.
The obligations of Quarterdeck hereunder are subject to the performance by
Xxxxxxxx of its obligations hereunder and to the satisfaction of the following
additional conditions precedent:
a. The representations and warranties made by
Xxxxxxxx in this Agreement shall, unless expressly waived in writing
by Quarterdeck, be true and correct as of the date hereof, on the
Agreement Date, on each Conversion Date, and on each Warrant Exercise
Date, and Quarterdeck shall have received on each such date a
certificate of the Chairman and Chief Financial Officer of Xxxxxxxx
dated such date and to such effect.
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b. On the Closing Date, Xxxxxxxx shall have
delivered to Quarterdeck a legal opinion of Xxxxxx & Xxxxx, counsel to
Xxxxxxxx, dated the date of delivery stating that:
(i) Xxxxxxxx is not a U.S. Person; and
(ii) The offer and sale of the Warrant by
Quarterdeck to Xxxxxxxx on the
Agreement Date does not require
registration under the Securities
Act in reliance upon Regulation S
thereunder;
c. On each Conversion Date, in respect of at
least 175,000 shares of Common Stock Xxxxxxxx shall have delivered to
Quarterdeck a legal opinion of Xxxxxx & Xxxxx, counsel to Xxxxxxxx,
dated the date of delivery, stating that:
(i) Xxxxxxxx is not a U.S. Person; and
(ii) the offer and sale of the Common
Stock issuable by Quarterdeck to
Xxxxxxxx on such date does not
require registration under the
Securities Act in reliance upon
Regulation S thereunder.
d. On each Warrant Exercise Date, in respect of
at least 175,000 Warrant Shares Xxxxxxxx shall have delivered to
Quarterdeck a legal opinion of Xxxxxx & Xxxxx, counsel to Xxxxxxxx,
dated the date of delivery, stating that:
(i) Xxxxxxxx is not a U.S. Person; and
(ii) the offer and sale of the Warrant
Shares issuable by Quarterdeck to
Xxxxxxxx on such date does not
require registration under the
Securities Act in reliance upon
Regulation S thereunder.
e. On the date of any transfer by Xxxxxxxx of
any Preferred Share or the Warrant or any Common Stock during the
applicable Restricted Period, Xxxxxxxx shall have delivered to
Quarterdeck or its transfer agent, as the case may be, a legal opinion
of Xxxxxx & Xxxxx, dated the date of such transfer, stating that such
transfer complies with the requirements of Regulation S.
10. Fees and Expenses. Each of Xxxxxxxx and Quarterdeck
agrees to pay its own expenses incident to the performance of its obligations
hereunder, including, but not limited to, the fees, expenses and disbursements
of such party's counsel.
11. Non-Performance.
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a. If, on the Agreement Date, on any Conversion
Date (as defined in Annex A hereto) or any Warrant Exercise Date (as
defined in Annex B hereto), Quarterdeck shall fail to deliver the
Warrant Shares, the Preferred Shares or Common Stock to Xxxxxxxx
required to be delivered pursuant to this Agreement for any reason
other than the failure of any condition precedent to Quarterdeck's
obligations hereunder or the failure by Xxxxxxxx to comply with its
obligations hereunder, then Quarterdeck shall:
(1) hold Xxxxxxxx harmless against any
loss, claim or damage arising from or as a result of such
failure by Quarterdeck; and
(2) reimburse Xxxxxxxx for all of its
out-of-pocket expenses, including fees and disbursements of
its counsel, incurred by Xxxxxxxx arising from or as a result
of such failure by Quarterdeck;
provided, however, that Quarterdeck shall then be under no further liability to
Xxxxxxxx except as provided in this Section 11 and Section 12 hereof.
b. If, on the Agreement Date Xxxxxxxx shall fail
to purchase the Warrant, the Preferred Shares or any Common Stock
required to be purchased pursuant to this Agreement for any reason
other than the failure of any condition precedent to Xxxxxxxx'x
obligations hereunder or the failure by Quarterdeck to comply with its
obligations hereunder, then Xxxxxxxx shall:
(1) hold Quarterdeck harmless against
any damage arising from or as result of such failure by
Xxxxxxxx;
(2) reimburse Quarterdeck for all of its
out-of-pocket expenses, including fees and disbursements of
its counsel, incurred by Quarterdeck arising from or as a
result of such failure by Xxxxxxxx; and
(3) surrender to Quarterdeck for
cancellation any portion of the Warrant not exercised prior to
the date of such default by Xxxxxxxx;
provided, however, that Xxxxxxxx shall then be under no further liability to
Quarterdeck except as provided in this Section 11 and Section 12 hereof.
12. Indemnification.
a. Indemnification of Xxxxxxxx. Quarterdeck
hereby agrees to indemnify Xxxxxxxx and each of its officers,
directors, employees, agents and affiliates and each person that
controls (within the meaning of Section 20 of the Securities Exchange
Act of 1934, as amended) any of the foregoing persons (each a
"Xxxxxxxx Indemnified Party") against any claim, demand, action,
liability, damages, loss, cost or expense (including, without
limitation, reasonable legal fees) (a "Proceeding"), that it
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may incur in connection with any of the transactions contemplated
hereby arising out of or based upon:
(1) any of the representations or
warranties made by Quarterdeck herein being untrue or
incorrect; and
(2) any breach or non-performance by
Quarterdeck of any of its covenants, agreements or obligations
under this Agreement;
and Quarterdeck hereby agrees to reimburse each Xxxxxxxx Indemnified
Party for any reasonable legal or other expenses incurred by such
Xxxxxxxx Indemnified Party in investigating or defending any such
Proceeding;
provided, however, that the foregoing indemnity shall not apply to any
Proceeding to the extent that it arises out of or is based upon the
gross negligence of Xxxxxxxx in connection therewith.
b. Indemnification of Quarterdeck. Xxxxxxxx
hereby agrees to indemnify Quarterdeck and each of its officers,
directors, employees, agents and affiliates and each person that
controls (within the meaning of Section 20 of the Securities Exchange
Act of 1934, as amended) any of the foregoing persons (each a
"Quarterdeck Indemnified Party") against any Proceeding, that it may
incur in connection with any of the transactions contemplated hereby
arising out of or based upon:
(1) any of the representations or
warranties made by Xxxxxxxx herein being untrue or incorrect;
and
(2) any breach or non-performance by
Xxxxxxxx of any of its covenants, agreements or obligations
under this Agreement;
and Xxxxxxxx hereby agrees to reimburse each Quarterdeck Indemnified
Party for any reasonable legal or other expenses incurred by such
Quarterdeck Indemnified Party in investigating or defending any such
Proceeding;
provided, however, that the foregoing indemnity shall not apply to any
Proceeding to the extent that it arises out of or is based upon the
gross negligence of Quarterdeck in connection therewith.
c. Conduct of Claims.
(1) Whenever a claim for indemnification
shall arise under this Section, the party seeking
indemnification (the "Indemnified Party"), shall notify the
party from whom such indemnification is sought (the
"Indemnifying Party") in writing of the Proceeding and the
facts constituting the basis for such
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claim in reasonable detail;
(2) Upon delivery of such notice, such
Indemnified Party shall have a duty to take all reasonable
steps to mitigate any losses, liabilities, costs, charges and
expenses relating to any such Proceeding;
(3) Such Indemnifying Party shall direct
the defense of any such Proceeding, provided, however, that
any such Indemnified Party shall have the right to retain the
counsel of its choice in connection with such Proceeding and
to participate at its own expense in the defense of any such
Proceeding; provided further, however, that counsel to the
Indemnifying Party shall not (except with the consent of the
relevant Indemnified Party) also be counsel to such
Indemnified Party. In no event shall the Indemnifying Party
be liable for fees and expenses of more than one counsel (in
addition to any local counsel) separate from its own counsel
for all Indemnified Parties in connection with any one action
or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances; and
(4) No Indemnifying Party shall,
without the prior written consent to the Indemnified Parties
(which consent shall not be unreasonably withheld), settle or
compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened,
or any claim whatsoever in respect of which indemnification
could be sought under this Section unless such settlement,
compromise or consent (A) includes an unconditional release of
each Indemnified Party from all liability arising out of such
litigation, investigation, proceeding or claim and (B) does
not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any
Indemnified Party.
13. Survival of the Representations, Warranties, etc. The
respective representations, warranties, and agreements made herein by or on
behalf of the parties hereto shall remain in full force and effect, regardless
of any investigation made by or on behalf of the other party to this Agreement
or any officer, director or employee of, or person controlling or under common
control with, such party and will survive delivery of and payment for the
Preferred Shares, the Warrant and any Common Stock issuable hereunder.
14. Notices. All communications hereunder shall be in writing, and
a. if sent to Xxxxxxxx, shall be delivered by
hand, sent by registered mail or transmitted and confirmed by telecopy
to Xxxxxxxx at:
Xxxxxxxx International Limited
c/o Midland Bank Trust Corporation (Cayman) Limited
X.X. Xxx 0000, Xxxx Xxxxxx
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Grand Cayman, Cayman Islands
British West Indies
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxx, Esq.
Telephone: (000) 000 0000
Facsimile: (000) 000 0000
b. if sent to Quarterdeck, shall be delivered by
hand, sent by registered mail or transmitted and confirmed by telecopy
to Quarterdeck at:
Quarterdeck Corporation
00000 Xxxxxxxx Xxx, Xxxxx Xxxxx
Xxxxxx xxx Xxx, XX 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
15. Miscellaneous.
a. This Agreement may be executed in one or more
counterparts and it is not necessary that signatures of all parties appear on
the same counterpart, but such counterparts together shall constitute but one
and the same agreement.
b. This Agreement shall inure to the benefit of
and be binding upon the parties hereto, their respective successors and, with
respect to Section 12 hereof, their respective officers, directors and
affiliates, and no other person shall have any right or obligation hereunder.
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c. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of New York, and
each of the parties hereto hereby submits to the non-exclusive jurisdiction of
any State or Federal court in the Borough of Manhattan in the City and State of
New York and any court hearing any appeal therefrom, over any suit, action or
proceeding against it arising out of or based upon this Agreement (a "Related
Proceeding"). Each of the parties hereto hereby waives any objection to any
Related Proceeding in such courts whether on the grounds of venue, residence or
domicile or on the ground that the Related Proceeding has been brought in an
inconvenient forum.
d. The provisions of this Agreement are
severable, and if any clause or provision hereof shall be held invalid, illegal
or unenforceable in whole or in part, such invalidity or unenforceability shall
not in any manner affect any other clause or provision of this Agreement.
e. This Agreement (including the Warrant and the
terms and conditions of the Certificate of Designations relating to the
Preferred Shares) represents the entire agreement between the parties hereto
and supersedes all other agreements, understandings and term sheets between
such parties.
f. The headings of the sections of this document
have been inserted for convenience of reference only and shall not be deemed to
be a part of this Agreement.
16. Time of Essence. Time shall be of the essence in
this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed and
delivered this Agreement, all as of the day and year first above written.
QUARTERDECK CORPORATION
By: ____________________________________
Name:
Title:
XXXXXXXX INTERNATIONAL LIMITED
By: ____________________________________
Name:
Title:
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SCHEDULE 3(e)
The terms of the following agreements (collectively, the
"Restrictive Agreements") to which Quarterdeck is a party prohibit the
redemption of, or any payment or distribution with respect to, the capital
stock of Quarterdeck:
1. Note Agreement dated as of March 1, 1996 between
Quarterdeck Corporation and the Purchaser named on
Schedule 1 thereto
2. Credit Agreement with Bank of America National Trust
& Savings Association dated February 14, 1996, as
amended to the date of the Agreement
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