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EXHIBIT 10.9
PRINTCAFE, INC.
SERIES D AND D-1 PREFERRED STOCK PURCHASE AGREEMENT
MARCH 8, 2000
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TABLE OF CONTENTS
Page
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1. Purchase and Sale of Preferred Stock................................................. 1
1.1 Sale and Issuance of Series D Preferred Stock................................. 1
1.2 Closing; Delivery............................................................. 1
2. Representations and Warranties of the Company........................................ 1
2.1 Organization, Good Standing and Qualification................................. 2
2.2 Capitalization................................................................ 2
2.3 Rights of Registration and Voting Rights...................................... 3
2.4 Subsidiaries; Joint Ventures.................................................. 3
2.5 Authorization................................................................. 4
2.6 Valid Issuance of Securities.................................................. 4
2.7 Governmental Consents......................................................... 4
2.8 Litigation.................................................................... 5
2.9 Intellectual Property......................................................... 5
2.10 Confidential Information and Invention Assignment Agreements.................. 5
2.11 Compliance with Other Instruments............................................. 6
2.12 Agreements; Action............................................................ 6
2.13 No Conflict of Interest....................................................... 7
2.14 Title to Property and Assets.................................................. 7
2.15 Financial Statements.......................................................... 7
2.16 Changes....................................................................... 8
2.17 Distributions................................................................. 9
2.18 Tax Returns and Payments...................................................... 9
2.19 Insurance..................................................................... 9
2.20 Employee Benefit Plans........................................................ 9
2.21 Labor Agreements and Actions.................................................. 9
2.22 Compliance with Environmental Requirements.................................... 10
2.23 Permits....................................................................... 10
2.24 Private Offering.............................................................. 10
2.25 Brokers and Finders........................................................... 10
2.26 Certificate of Incorporation.................................................. 11
2.27 Bylaws........................................................................ 11
2.28 Disclosure.................................................................... 11
2.29 Compliance with Other Laws.................................................... 11
2.30 Year 2000 Compliance.......................................................... 11
3. Interpretation....................................................................... 11
4. Representations and Warranties of the Purchasers..................................... 12
4.1 Authorization................................................................. 12
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4.2 Purchase Entirely for Own Account............................................. 12
4.3 Disclosure of Information..................................................... 12
4.4 Restricted Securities......................................................... 12
4.5 No Public Market.............................................................. 13
4.6 Legends....................................................................... 13
4.7 Accredited Investor........................................................... 13
4.8 Foreign Investors............................................................. 13
5. Covenants of the Company............................................................. 14
5.1 Compliance.................................................................... 14
5.2 Performance................................................................... 14
5.3 Books and Records............................................................. 14
5.4 Renewals and Good Standing.................................................... 14
5.5 Principle Business............................................................ 14
5.6 Proprietary Information and Assignment Agreement.............................. 14
5.7 Stock Options................................................................. 14
5.8 Securities Filings............................................................ 15
5.9 Investment of Funds........................................................... 15
5.10 Directors' and Officers' Insurance............................................ 15
5.11 Survival of Company's Covenants............................................... 15
6. Conditions of the Purchasers' Obligations at the Closing............................. 15
6.1 Representations and Warranties................................................ 15
6.2 Performance................................................................... 15
6.3 Compliance Certificate........................................................ 15
6.4 Qualifications................................................................ 15
6.5 Written Consents.............................................................. 15
6.6 Stock Certificates............................................................ 16
6.7 Restated Certificate.......................................................... 16
6.8 Restated Investors' Rights Agreement.......................................... 16
6.9 Restated Co-Sale Agreement.................................................... 16
6.10 Restated Voting Agreement..................................................... 16
6.11 Confidential Information and Invention Assignment Agreement................... 16
6.12 No Material Adverse Change.................................................... 16
6.13 Company Legal Opinions........................................................ 17
6.14 No Litigation................................................................. 17
6.15 Proceedings and Documents..................................................... 17
6.16 Closing of Common Stock Financing............................................. 17
6.17 Closing Documents............................................................. 17
6.18 General....................................................................... 18
7. Conditions of the Company's Obligations at the Closing............................... 18
7.1 Representations and Warranties................................................ 18
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7.2 Performance................................................................... 18
7.3 Qualifications................................................................ 18
8. Miscellaneous........................................................................ 18
8.1 Survival of Warranties........................................................ 18
8.2 Entire Agreement.............................................................. 18
8.3 Transfer; Successors and Assigns.............................................. 18
8.4 Governing Law................................................................. 19
8.5 Counterparts.................................................................. 19
8.6 Titles and Subtitles.......................................................... 19
8.7 Notices....................................................................... 19
8.8 Finder's Fee.................................................................. 19
8.9 Attorney's Fees............................................................... 19
8.10 Amendments and Waivers of Agreement........................................... 19
8.11 Severability.................................................................. 20
8.12 Delays or Omissions........................................................... 20
8.13 Confidentiality............................................................... 20
8.14 Exculpation Among Purchasers.................................................. 20
8.15 Indemnification............................................................... 21
8.16 Press Release................................................................. 21
8.17 Use of Proceeds............................................................... 21
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PRINTCAFE, INC.
SERIES D AND D-1 PREFERRED STOCK PURCHASE AGREEMENT
This Series D and D1 Preferred Stock Purchase Agreement (this
"Agreement") is made as of March 8, 2000 by and among printCafe, Inc., a
Delaware corporation (the "Company"), and the investors listed on Exhibit A
attached hereto (each a "Purchaser" and together the "Purchasers").
In consideration of the mutual promises, covenants and conditions
hereinafter set forth, the parties hereto hereby agree as follows:
1. PURCHASE AND SALE OF PREFERRED STOCK.
1.1 SALE AND ISSUANCE OF SERIES D PREFERRED STOCK.
(a) The Company shall adopt and file with the Secretary of
State of the State of Delaware on or before the Closing (as defined in Section
1.2(a) below) the Fourth Amended and Restated Certificate of Incorporation in
the form attached hereto as Exhibit B (the "Restated Certificate").
(b) Subject to the terms and conditions of this Agreement,
each Purchaser agrees to purchase at the Closing, and the Company agrees to sell
and issue to each Purchaser at the Closing, that number of shares of the
Company's Series D Preferred Stock and/or Series D-1 Preferred Stock, $0.0001
par value per share, set forth opposite each such Purchaser's name on Exhibit A
attached hereto at a purchase price of $8.83 per share. The shares of Series D
Preferred Stock and Series D-1 Preferred Stock issued to the Purchasers pursuant
to this Agreement shall be hereinafter referred to as the "Stock."
1.2 CLOSING; DELIVERY.
(a) The purchase and sale of the Stock shall take place at the
executive offices of the Company, at 10:00 a.m., on March 9, 2000, or at such
other time and place as the Company and the Purchasers mutually agree upon,
orally or in writing (which time and place are designated as the "Closing").
(b) At the Closing, the Company shall deliver to each
Purchaser a certificate representing the Stock being purchased by such Purchaser
against payment of the purchase price therefor by check payable to the Company
or by wire transfer to the Company's bank account.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to each Purchaser that (acknowledging that each
Purchaser is relying on the representations and warranties set forth in this
Section 2 in connection with the purchase of the Stock by such Purchaser),
except as set forth on the Schedule of Exceptions attached hereto as Exhibit C:
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2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite corporate power and authority to
carry on its business. The Company is duly qualified as a foreign corporation or
is otherwise duly qualified to transact business and is in good standing in each
jurisdiction in which the failure so to qualify would, either individually or in
the aggregate, have a material adverse effect on its business or properties.
2.2 CAPITALIZATION. Immediately prior to the Closing, the
authorized capital of the Company shall consist of:
(a) 46,940,082 shares of Preferred Stock, of which (i)
2,500,000 shares have been designated Series A Preferred Stock, 2,455,798 of
which will be issued and outstanding immediately prior to the Closing, (ii)
10,250,000 shares have been designated Series A-1 Preferred Stock, 9,534,148 of
which will be issued and outstanding immediately prior to the Closing, (iii)
31,250,000 have been designated Series B Preferred Stock, 31,186,312 of which
will be issued and outstanding immediately prior to the Closing, (iv) 2,015,082
have been designated Series C Preferred Stock, 1,765,082 of which will be issued
and outstanding immediately prior to the Closing, (v) 150,000 have been
designated Series C-1 Preferred Stock, all of which will be issued and
outstanding immediately prior to the Closing, (vi) 325,000 shares of Series D
Preferred Stock, none of which will be issued and outstanding immediately prior
to the Closing, and (vii) 550,000 shares of Series D-1 Preferred Stock, none of
which will be issued and outstanding immediately prior to the Closing. The
rights, privileges and preferences of the Preferred Stock are as stated in the
Restated Certificate. All of the outstanding shares of Preferred Stock have been
duly authorized, fully paid and nonassessable and issued in compliance with all
applicable federal and state securities laws.
(b) 150,000,000 shares of Common Stock, of which (i)
118,750,000 have been designated Class A Common Stock, 5,886,656 of which are
issued and outstanding immediately prior to the Closing, (ii) 31,250,000 have
been designated Class B Common Stock, none of which are issued and outstanding
immediately prior to the Closing and (iii) 1,150,000 have been designated Class
C Common Stock, none of which will be issued and outstanding prior to the
Closing. All of the outstanding shares of Common Stock have been duly
authorized, fully paid and are nonassessable and issued in compliance with all
applicable federal and state securities laws. Simultaneous with the Closing, the
Company will issue 225,916 shares of its Class A Common Stock and 1,132,502
shares of its Class C Common Stock pursuant to the Common Stock Purchase
Agreement (as defined in Section 6.16).
(c) The Company has reserved 382,215 shares of Class A Common
Stock and 516,976 shares of Series A-1 Preferred Stock (collectively, "Option
Stock") for issuance to officers, directors, employees and consultants of the
Company pursuant to its 1999 Revised Stock Plan duly adopted by the Board of
Directors and approved by the Company's stockholders (the "1999 Revised Stock
Plan"), and the Company has reserved 10,000,000 shares of Common Stock for
issuance to officers, directors, employees and consultants of the Company
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pursuant to its 2000 Incentive Stock Plan duly adopted by the Board of Directors
and approved by the Company's stockholders (the "2000 Incentive Stock Plan" and,
together with the 1999 Revised Stock Plan, the "Stock Plans"). Of such reserved
shares of Option Stock under the 1999 Revised Stock Plan, no shares have been
issued pursuant to restricted stock purchase agreements, options to purchase
382,215 shares of Common Stock and 516,976 shares of Series A-1 Preferred Stock
have been granted and are currently outstanding, and no shares of Common Stock
remain available for issuance to officers, directors, employees and consultants
pursuant to the 1999 Revised Stock Plan. Of such reserved shares of Common Stock
under the 2000 Incentive Stock Plan, no shares have been issued pursuant to
restricted stock purchase agreements, options to purchase 1,096,169 shares of
Common Stock have been granted and are currently outstanding, and 8,903,831
shares of Common Stock remain available for issuance to officers, directors,
employees and consultants pursuant to the 2000 Incentive Stock Plan.
(d) Except for outstanding options issued pursuant to the
Stock Plans and the warrants listed in Section 2.2 of the Schedule of
Exceptions, there are no outstanding options, warrants, rights (including
conversion or preemptive rights and rights of first refusal or similar rights)
or agreements, orally or in writing, for the purchase or acquisition from the
Company of any shares of its capital stock.
(e) The issuance of Series B Preferred Stock to Creo SRL
pursuant to that certain Series B Preferred Stock Purchase Agreement dated
February 15, 2000 did not constitute a dilutive issuance with respect to the
Company's Series A and A-1 Preferred Stock under or pursuant to the terms of
Article VI(B)(4) of the Company's Certificate of Incorporation as then in
effect. As of the date hereof, Creo SRL has not exercised the Series B Preferred
Stock Voting Conversion Right (as defined in the Restated Certificate).
2.3 RIGHTS OF REGISTRATION AND VOTING RIGHTS. Except as
contemplated in the Second Amended and Restated Investors' Rights Agreement, in
the form attached hereto as Exhibit D (the "Restated Investors' Rights
Agreement"), the Company has not granted or agreed to grant any registration
rights, including piggyback registration rights, to any person or entity. To the
Company's knowledge, except as contemplated in the Second Amended and Restated
Voting Agreement, in the form attached hereto as Exhibit E (the "Restated Voting
Agreement"), no stockholder of the Company has entered into any agreements with
respect to the voting of capital stock of the Company. Except as contemplated by
the Restated Certificate, the Restated Voting Agreement and the Second Amended
and Restated Right of First Refusal and Co-Sale Agreement, in the form attached
hereto as Exhibit F (the "Restated Co-Sale Agreement"), there are no
stockholders agreements, pledge agreements, buy-sell arrangements, rights of
first refusal or proxies related to any securities of the Company to which the
Company is subject or a party or to which, to the Company's knowledge, any
stockholder, officer, director or affiliate of the Company is a party or
subject.
2.4 SUBSIDIARIES; JOINT VENTURES. The Company does not currently
own or control, directly or indirectly, any interest in any other corporation,
association, or other business entity other than the subsidiaries set forth on
Schedule 2.4 of the Schedule of Exceptions (the
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"Subsidiaries"). The Company is not a participant in any joint venture,
partnership or similar arrangement.
2.5 AUTHORIZATION. All corporate action on the part of the Company,
its officers, directors and stockholders necessary for the authorization,
execution and delivery of this Agreement, the Restated Investors' Rights
Agreement, the Restated Voting Agreement and the Restated Co-Sale Agreement
(collectively, the "Transaction Documents"), the performance of all obligations
of the Company hereunder and thereunder and the authorization, issuance and
delivery of the Stock and the Common Stock issuable upon conversion of the Stock
(together, the "Securities") has been taken or will be taken prior to the
Closing, and the Transaction Documents, when executed and delivered by the
Company, shall constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their respective terms,
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance, and other laws of general application
affecting enforcement of creditors' rights generally, as limited by laws
relating to the availability of specific performance, injunctive relief, or
other equitable remedies, or (ii) to the extent the indemnification provisions
contained in the Restated Investors' Rights Agreement may be limited by
applicable federal or state securities laws. All corporate action on the part of
the Company and its predecessors, officers, directors, stockholders and
subsidiaries necessary for the authorization, execution and/or delivery, as
applicable, for all past corporate actions was obtained.
2.6 VALID ISSUANCE OF SECURITIES. The Stock that is being issued to
the Purchasers hereunder, when issued, sold and delivered in accordance with the
terms hereof for the consideration expressed herein, will be duly and validly
issued, fully paid and nonassessable and free and clear of all preemptive
rights, rights of first refusal, liens, charges, restrictions, claims and any
other encumbrances imposed by or through the Company other than restrictions on
transfer under this Agreement, the Restated Investors' Rights Agreement, the
Restated Co-Sale Agreement and applicable state and federal securities laws of
the United States. Based in part upon the representations of the Purchasers in
this Agreement and subject to the provisions of Section 2.7 below, the Stock
will be issued in compliance with all applicable federal and state securities
laws. The Common Stock issuable upon conversion of the Stock has been duly and
validly reserved for issuance and, upon issuance in accordance with the terms of
the Restated Certificate, shall be duly and validly issued, fully paid and
nonassessable and free and clear of all preemptive rights, rights of first
refusal, liens, charges, restrictions, claims and any other encumbrances imposed
by or through the Company other than restrictions on transfer under this
Agreement, the Restated Investors' Rights Agreement, the Restated Co-Sale
Agreement and applicable federal and state securities laws and will be issued in
compliance with all applicable federal and state securities laws of the United
States and, where applicable, provincial securities laws of Canada.
2.7 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority of the United
States is required in connection with the consummation of
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the transactions contemplated by this Agreement, except for filings pursuant to
applicable state securities laws and Regulation D of the Securities Act of 1933,
as amended (the "Securities Act"). Based in part on the representations of the
Purchasers set forth in Section 4 hereof, the offer, sale and issuance of the
Stock, in accordance with the terms hereof for the consideration expressed
herein, are exempt from the registration requirements of Section 5 of the
Securities Act and from the qualification requirements of applicable state
securities laws.
2.8 LITIGATION. There is no action, suit, proceeding or
investigation pending or, to the Company's knowledge, currently threatened
against the Company or any of the Subsidiaries, or any basis therefor known to
the Company, that questions the validity of the Transaction Documents or the
right of the Company to enter into them, or to consummate the transactions
contemplated hereby or thereby, or that might result, either individually or in
the aggregate, in any material adverse change in the financial condition,
assets, liabilities, operations or financial performance of the Company,
financially or otherwise, or any change in the current equity ownership of the
Company. Neither the Company nor any of the Subsidiaries is a party or subject
to the provisions of any order, writ, injunction, judgment or decree of any
court or government agency or instrumentality. There is no action, suit,
proceeding or investigation by the Company or any of the Subsidiaries currently
pending or which the Company or any of the Subsidiaries intends to initiate. The
foregoing includes, without limitation, actions pending or threatened (or any
basis therefor known to the Company) involving the prior employment of any of
the Company's employees, their use in connection with the Company's business of
any information or technologies allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers.
2.9 INTELLECTUAL PROPERTY. To the Company's knowledge, (i) the
Company owns or possesses sufficient legal rights to all patents, trademarks,
service marks, tradenames, copyrights, trade secrets, licenses, information and
proprietary rights and processes (collectively, "Intellectual Property Rights")
necessary for its business without any conflict with, or infringement of, the
rights of others; and (ii) no third party is infringing or violating any of the
Company's Intellectual Property Rights. The Company has not received any written
communications alleging that the Company has violated or, by conducting its
business, would violate any of the Intellectual Property Rights of any other
person or entity. There are no outstanding options, licenses or agreements of
any kind related to the foregoing, nor is the Company bound by, or a party to,
any options, licenses or agreements of any kind with respect to Intellectual
Property of any other forms.
2.10 CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENTS.
Each director, officer, independent contractor, consultant and employee of the
Company (collectively, "Service Providers") have entered into an agreement with
the Company regarding confidentiality, non-solicitation of employees and
customers and assignment of all Intellectual Property Rights, technical
information and other information developed and/or worked on by such Service
Provider while employed or engaged with the Company (each, a "Confidentiality
and Invention Assignment Agreement"). To the Company's knowledge, (i) no past or
present Service Provider is in violation of any term of any Confidentiality and
Invention Assignment
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Agreement between the Company and such Service Provider; and (ii) it is not nor
will it be necessary to use any inventions of any of its Service Providers (or
persons it currently intends to hire) made prior to their employment or
engagement by the Company. Each Service Provider hired or engaged by the Company
after the date hereof shall, prior to their employment or engagement with the
Company, enter into a Confidentiality and Invention Assignment Agreement with
the Company.
2.11 COMPLIANCE WITH OTHER INSTRUMENTS. The Company is not in
violation in any material respect or default of any provisions of its Restated
Certificate or Bylaws or of any provision, instrument, agreement, commitment,
arrangement, license, judgment, order, writ, decree or contract to which it is a
party or by which it is bound or, to its knowledge, of any provision of federal
or state statute, rule or regulation applicable to the Company, which violation
or default is reasonably likely to result in a material adverse effect on the
financial condition, assets, liabilities, operations or financial performance of
the Company. No event has occurred which with the passage of time or the giving
of notice, or both, would constitute a material breach of or default under any
of the foregoing, which material violation or breach or default is reasonably
likely to result in a material adverse effect on the financial condition,
assets, liabilities, operations or financial performance of the Company. The
execution, delivery and performance of the Transaction Documents and the
consummation of the transactions contemplated thereby will not result in any
such violation or breach or be in conflict with or constitute, with or without
the passage of time and giving of notice, either a default under any such
provision, agreement, commitment, arrangement, license, instrument, judgment,
order, writ, decree or contract or an event which results in the creation of any
lien, charge or encumbrance upon any assets of the Company. Neither the
execution or delivery of this Agreement, nor the carrying on of the Company's
business by the employees of the Company, nor the conduct of the Company's
business as proposed, will, to the Company's knowledge, conflict in any material
respect with or result in a material breach of the terms, conditions, or
provisions of, or constitute a default under, any contract, covenant or
instrument under which any of the Company's employees is now obligated.
2.12 AGREEMENTS; ACTION.
(a) There are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, affiliates
or any affiliate thereof.
(b) Except as explicitly contemplated by the Transaction
Documents, there are no agreements, understandings, instruments, contracts or
proposed transactions to which the Company or any of the Subsidiaries is a party
or by which it is bound that involve (i) obligations (contingent or otherwise)
of, or payments to, the Company or any of the Subsidiaries in excess of $50,000,
(ii) the license of any patent, copyright, trade secret or other proprietary
right to or from the Company or any of the Subsidiaries, or (iii) the grant of
rights to manufacture, produce, assemble, license, market, or sell its products
to any other person or affect the Company's exclusive right to develop,
manufacture, assemble, distribute, market or sell its products.
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(c) Neither the Company nor any of the Subsidiaries has (i)
declared or paid any dividends, or authorized or made any distribution upon or
with respect to any class or series of its capital stock, (ii) incurred any
indebtedness for money borrowed or incurred any other liabilities individually
in excess of $50,000 or in excess of $100,000 in the aggregate, (iii) made any
loans or advances to any person, other than ordinary advances to the Company's
employees for business expenses, or (iv) sold, exchanged or otherwise disposed
of any of its assets or rights, other than the sale of its inventory in the
ordinary course of business.
(d) Except as disclosed in Section 2.12 of the Schedule of
Exceptions or as set out in the Transaction Documents, the Company has not
entered into any binding letters of intent with any corporation, partnership,
association, other business entity or any individual regarding (i) the
consolidation or merger of the Company with or into any such corporation or
other business entity, (ii) the sale, conveyance or disposition of all or
substantially all of the assets of the Company or a transaction or series of
transactions in which more than 50% of the voting power of the company is
disposed of, or (iii) any other form of acquisition, liquidation, dissolution or
winding-up of the Company.
2.13 NO CONFLICT OF INTEREST. The Company is not indebted, directly
or indirectly, to any of its officers or directors, in any amount whatsoever,
other than in connection with expenses or advances of expenses incurred in the
ordinary course of business or relocation expenses of employees. To the
Company's knowledge, none of the Company's officers or directors are, directly
or indirectly, indebted to the Company (other than in connection with purchases
of the Company's stock) or have any direct or indirect ownership interest in any
firm or corporation with which the Company is affiliated or with which the
Company has a business relationship, or any firm or corporation which competes
with the Company (other than ownership of stock in, but not exceeding two
percent (2%) of the outstanding capital stock of, any publicly traded company
that competes with the Company). To the Company's knowledge, none of the
Company's officers or directors are, directly or indirectly, interested in any
material contract with the Company. The Company is not a guarantor of any
indebtedness of any other person, firm or corporation.
2.14 TITLE TO PROPERTY AND ASSETS. The Company has good and valid
title to all of its properties and assets, both real and personal, and has good
title to all its leasehold interests, in each case free and clear of all
mortgages, liens, pledges, loans, security interests, conditional sales
agreements, encumbrances or charges, except for Permitted Liens (as defined
below). The Company owns or leases all properties and assets reasonably
necessary to the operation of its business as now conducted. With respect to the
property and assets it leases, the Company is in compliance with such leases
and, to the Company's knowledge, holds a valid leasehold interest free of any
liens, claims or encumbrances, except for Permitted Liens. For purposes of this
Agreement, "Permitted Liens" shall mean any (a) mechanics', carriers', workers'
and other similar liens arising in the ordinary course of business which are not
delinquent and which in the aggregate are not material in amount, and do not
interfere with the present use of the assets of the Company to which they apply;
(b) liens for current taxes and assessments not yet due and payable; (c) liens
and encumbrances that have arisen in the ordinary course of business
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and that do not (in any case or in the aggregate) materially detract from the
value of the assets subject thereto or materially impair the operations of the
Company; and (d) with respect to any asset of the Company which consists of a
leasehold or other possessory interest in real property, all encumbrances,
covenants, imperfections in title, easements, restrictions and other title
matters (whether or not the same are recorded) not known to the Company to which
the underlying fee estate in such real property is subject which were not
created by or incurred by the Company.
2.15 FINANCIAL STATEMENTS. Attached hereto as Exhibit G are the
unaudited balance sheet of the Company as of December 31, 1999, together with an
unaudited statement of income and expenses and statement of cash flows for the
fiscal year ended December 31, 1999 (collectively, the "Financial Statements").
The Financial Statements are complete in all material respects and in accordance
with the books and records of the Company and fairly present the financial
condition and operating results of the Company as of the dates, and for the
periods, indicated therein, subject to the lack of footnote disclosures and
normal year-end audit adjustments. Except as set forth in the Financial
Statements, the Company has no material liabilities, contingent or otherwise,
other than (i) liabilities incurred in the ordinary course of business
subsequent to December 31, 1999, (ii) obligations under contracts and
commitments incurred in the ordinary course of business and not required under
generally accepted accounting principles to be reflected in the Financial
Statements, and (iii) performance obligations of the Company under the
Transaction Documents.
2.16 CHANGES. Since December 31, 1999 there has not been:
(a) any change in the assets, liabilities, financial condition
or operating results of the Company from that reflected in the Financial
Statements, except changes in the ordinary course of business that have not
been, in the aggregate, materially adverse;
(b) any damage, destruction, loss or other occurrence or
development materially and adversely affecting the business, properties or
financial condition of the Company;
(c) any waiver or compromise by the Company of a valuable
right or any material debt owed to it;
(d) any satisfaction or discharge of any lien, claim, or
encumbrance or payment of any obligation by the Company, except in the ordinary
course of business and that is not material to the assets, business, properties
or financial condition or operating results of the Company;
(e) any material change or amendment to a material contract or
agreement by which the Company or any of its assets or properties is bound or
subject;
(f) any material change or amendment in any compensation
arrangement or agreement with any employee, officer, director or stockholder;
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(g) any sale, assignment or transfer of any patents,
trademarks, copyrights, trade secrets or other intangible assets;
(h) any resignation or termination of employment of any
officer or key employee of the Company; and the Company, is not aware of any
impending resignation or termination of employment of any such officer or key
employee;
(i) any mortgage, pledge, transfer of a security interest in,
or lien, created by the Company, with respect to any of its material properties
or assets, except for Permitted Liens;
(j) any loans or guarantees made by the Company to or for the
benefit of its employees, officers or directors, or any members of their
immediate families, other than travel advances and other advances made in the
ordinary course of its business;
(k) any declaration, setting aside or payment or other
distribution in respect to any of the Company's capital stock, or any direct or
indirect redemption, purchase, or other acquisition of any of such stock by the
Company;
(l) to the Company's knowledge, any other event or condition
of any character that might materially and adversely affect the business,
properties or financial condition of the Company; or
(m) any arrangement or commitment by the Company to do any of
the things described in this Section 2.16.
2.17 DISTRIBUTIONS. There has been no declaration or payment by the
Company of any dividend, nor any distribution by the Company of any assets of
any kind, to any of its stockholders.
2.18 TAX RETURNS AND PAYMENTS. The Company has filed all tax
returns and reports as required by applicable law and such tax returns and
reports are true and correct in all material respects. The Company has paid all
taxes, fees, assessments and other governmental charges upon the Company, or
upon any of its properties, income, or franchises, shown in such returns and on
assessments received by the Company to be due as of the date hereof and no such
taxes or assessments are being contested.
2.19 INSURANCE. The Company has in full force and effect fire and
casualty insurance policies, with extended coverage, sufficient in amount
(subject to reasonable deductibles) to allow it to replace any of its properties
that might be damaged or destroyed, and the Company has such other insurance
policies and coverages as are customary in the Company's industry.
2.20 EMPLOYEE BENEFIT PLANS. Section 2.20 of the Schedule of
Exceptions sets forth all currently effective employment contracts, deferred
compensation arrangements, bonus
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plans, incentive plans, profit sharing plans, retirement agreements or other
employee compensation agreements. The Company does not have any Employee Benefit
Plan as defined in the Employee Retirement Income Security Act of 1974, as
amended.
2.21 LABOR AGREEMENTS AND ACTIONS. The Company is not bound by or
subject to (and none of its assets or properties is bound by or subject to) any
written or oral, express or implied, contract, commitment or arrangement with
any labor union, and no labor union has requested or, to the knowledge of the
Company, has sought to represent any of the employees, representatives or agents
of the Company. There is no strike or other labor dispute involving the Company
pending, or to the knowledge of the Company threatened, which could have a
material adverse effect on the financial condition, assets, liabilities,
operations or financial performance of the Company, nor is the Company aware of
any labor organization activity involving its employees. The employment of each
officer and employee of the Company is terminable at the will of the Company.
The services of each consultant and independent contractor is terminable by the
Company upon not more than thirty (30) days prior written notice. To its
knowledge, the Company has complied in all material respects with all applicable
state and federal equal employment opportunity laws and with other laws related
to employment.
2.22 COMPLIANCE WITH ENVIRONMENTAL REQUIREMENTS. To the Company's
knowledge, it has obtained all material permits, licenses and other
authorizations required under federal, state and local laws relating to
pollution or protection of the environment. The Company has not violated any
applicable Environmental Law, the violation of which is reasonably likely to
result in a material adverse change in the financial condition, assets,
liabilities, operations or financial performance of the Company. To the
knowledge of the Company, there are no present requirements of any applicable
Environmental Law which is due to be imposed upon it which will materially
increase its cost of complying with the Environmental Laws. All past on-site
generation, treatment, storage and disposal of Waste, including Hazardous Waste,
by the Company and, to its knowledge, by its predecessors have been done in
compliance with the currently applicable Environmental Laws, and all past
off-site treatment, storage and disposal of Waste, including Hazardous Waste,
generated by the Company and, to its knowledge, by its predecessors have been
done in compliance with the currently applicable Environmental Laws. As used in
this Agreement, the terms (i) "Environmental Laws" include, but are not limited
to, any federal, state, local or foreign law, statute, charter or ordinance, and
any rule, regulation, binding interpretation, binding policy, permit, order,
court order or consent decree issued pursuant to any of the foregoing, which
pertains to, governs or otherwise regulates any of the following activities,
including, without limitation, (a) the emission, discharge, release or spilling
of any substance into the air, surface water, groundwater, soil or substrata;
(b) the manufacturing, processing, sale, generation, treatment, storage,
disposal labeling or other management of any Waste, Hazardous Substance or
Hazardous Waste, and (ii) "Waste," "Hazardous Substance," and "Hazardous Waste"
include any substance defined as such by any applicable Environmental Law.
2.23 PERMITS. The Company and each of the Subsidiaries has all
franchises, permits, licenses and any similar authority necessary for the
conduct of its business, the lack of
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which could materially and adversely affect the business, properties or
financial condition of the Company and, to its knowledge, it can obtain, without
undue burden or expense, any similar authority for the conduct of its business
as planned to be conducted. The Company is not in default in any material
respect under any of such franchises, permits, licenses or other similar
authority.
2.24 PRIVATE OFFERING. Neither the Company nor anyone acting on its
behalf has offered any of the Stock or similar securities for issuance or sale
to, or solicited any offer to acquire any of the same from, anyone so as to make
the issuance and sale of the Stock subject to registration requirements of
Section 5 of the Securities Act.
2.25 BROKERS AND FINDERS. The Company has not retained any
investment banker, broker, finder or any other third party in connection with
the transactions contemplated by this Agreement.
2.26 CERTIFICATE OF INCORPORATION. At the time of Closing, the
Company's certificate of incorporation on file with the Secretary of the State
of Delaware shall be in the form of the Restated Certificate, and no action
shall have been taken to amend or modify such Restated Certificate.
2.27 BYLAWS. The Bylaws of the Company are in the form attached
hereto as Exhibit H and no action has been taken to amend or modify such Bylaws.
2.28 DISCLOSURE. The Company has provided the Purchasers with all
the information that the Purchasers have requested in writing for deciding
whether to acquire the Stock. This Agreement, including all representations
herein by the Company, and any exhibits hereto or any certificate furnished or
to be furnished to Purchasers at the Closing, taken together, do not contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements contained herein or therein not misleading in
light of the circumstances under which they were made.
2.29 COMPLIANCE WITH OTHER LAWS. The Company has complied in all
material respects with all laws, statutes, rules, regulations and orders of,
and, to its knowledge, has secured all necessary permits and authorizations and
licenses issued by, federal, state, local and foreign agencies and authorities,
applicable to its business, properties and operations.
2.30 YEAR 2000 COMPLIANCE. To the Company's knowledge, each item of
software and hardware that has been developed by the Company is Year 2000
Compliant (as defined below). For purposes of this Section 2.30, an item of
software or hardware shall be deemed to be "Year 2000 Compliant" only if
operating on a stand-alone basis without reference to dates supplied by third
party software or hardware: (i) the functions, calculations, and other computing
processes of such item of software or hardware (collectively, "Processes")
perform without interruption related to the processing of date data representing
calendar dates before, on or after January 1, 2000; (ii) such item of software
or hardware accepts, calculates, compares,
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sorts, extracts, sequences and otherwise processes date inputs and date values,
and returns and displays date values, without interruption related to the
processing of date data representing calendar dates before, on or after January
1, 2000; (iii) such item of software or hardware stores and displays date
information without interruption related to the processing of date data
representing calendar dates before, on or after January 1, 2000; and (iv) such
item of software or hardware determines leap years without interruption related
to the processing of date data representing calendar dates before, on or after
January 1, 2000, unless, in each case, such interruption related to the
processing of date data representing calendar dates before, on or after January
1, 2000 is caused by external sources, such as in third party operating systems,
data, or other applications not supplied by the Company, or with respect to
incorrect or two-digit date information provided by the user, third party
operating systems or from any other external product, source or interface.
3. INTERPRETATION.
(a) For the purposes of the representations and warranties
contained in Section 2, whenever "to the Company's knowledge" or "to its
knowledge" is used, it means to the knowledge of the officers and directors of
the Company after making such diligent inquiry as may be reasonable under the
circumstances.
(b) For the purposes of the representations and warranties
contained in Section 2, all references to the "Company" shall be deemed to
include Programmed Solutions, Inc. and the Subsidiaries.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each Purchaser
hereby represents and warrants to the Company that:
4.1 AUTHORIZATION. Such Purchaser has full power and authority to
enter into the Transaction Documents. The Transaction Documents, when executed
and delivered by the Purchaser, will constitute valid and legally binding
obligations of the Purchaser, enforceable in accordance with their respective
terms, except (a) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance, and any other laws of general
application affecting enforcement of creditors' rights generally, and as limited
by laws relating to the availability of a specific performance, injunctive
relief, or other equitable remedies, or (b) to the extent the indemnification
provisions contained in the Restated Investors' Rights Agreement may be limited
by applicable federal or state securities laws.
4.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made with
the Purchaser in reliance upon the Purchaser's representations to the Company,
which by the Purchaser's execution of this Agreement, the Purchaser hereby
confirms, that the Securities to be acquired by the Purchaser will be acquired
for investment for the Purchaser's own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof in violation
of the Securities Act, and that the Purchaser has no present intention of
selling, granting any participation in, or otherwise distributing the same in
violation of the Securities Act. By
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executing this Agreement, the Purchaser further represents that the Purchaser
does not presently have any contract, undertaking, agreement or arrangement with
any person to sell, transfer or grant participations to such person or to any
third person, with respect to any of the Securities. The Purchaser has not been
formed for the specific purpose of acquiring the Securities.
4.3 DISCLOSURE OF INFORMATION. The Purchaser has had an opportunity
to discuss the Company's business, management, financial affairs and the terms
and conditions of the offering of the Stock with the Company's management and
has had an opportunity to review the Company's facilities. The Purchaser
understands that such discussions, as well as any other written information
delivered by the Company to the Purchaser, were intended to describe the aspects
of the Company's business which it believes to be material.
4.4 RESTRICTED SECURITIES. The Purchaser understands that the
Securities have not been, and will not be, registered under the Securities Act,
by reason of a specific exemption from the registration provisions of the
Securities Act which depends upon, among other things, the bona fide nature of
the investment intent and the accuracy of the Purchaser's representations as
expressed herein. The Purchaser understands that the Securities are "restricted
securities" under applicable U.S. federal and state securities laws and that,
pursuant to these laws, the Purchaser must hold the Securities indefinitely
unless they are registered with the Securities and Exchange Commission and
qualified by state authorities, or an exemption from such registration and
qualification requirements is available. The Purchaser acknowledges that the
Company has no obligation to register or qualify the Securities for resale
except as set forth in the Restated Investors' Rights Agreement. The Purchaser
further acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements, including, but not
limited to, the time and manner of sale, the holding period for the Securities,
and on requirements relating to the Company which are outside of the Purchaser's
control, and which the Company is under no obligation and may not be able to
satisfy except as specifically provided in the Restated Investors' Rights
Agreement.
4.5 NO PUBLIC MARKET. The Purchaser understands that no public
market now exists for any of the securities issued by the Company, and that the
Company has made no assurances that a public market will ever exist for the
Securities.
4.6 LEGENDS. The Purchaser understands that the Securities, and any
securities issued in respect of or exchange for the Securities, may bear one or
all of the following legends:
(a) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A
FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED
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UNDER THE SECURITIES ACT OF 1933."
(b) Any legend set forth in the other Transaction Documents.
(c) Any legend required by the Blue Sky laws of any state to
the extent such laws are applicable to the shares represented by the certificate
so legended.
4.7 ACCREDITED INVESTOR. The Purchaser is an accredited investor as
defined in Rule 501(a) of Regulation D promulgated under the Securities Act.
4.8 FOREIGN INVESTORS. If the Purchaser is not a United States
person (as defined by Section 7701(a)(30) of the Internal Revenue Code of 1986,
as amended), such Purchaser hereby represents that it has satisfied itself as to
the full observance of the laws of its jurisdiction in connection with any
invitation to subscribe for the Securities or any use of this Agreement,
including (i) the legal requirements within its jurisdiction for the purchase of
the Securities, (ii) any foreign exchange restrictions applicable to such
purchase, (iii) any governmental or other consents that may need to be obtained,
and (iv) the income tax and other tax consequences, if any, that may be relevant
to the purchase, holding, redemption, sale, or transfer of the Securities. Such
Purchaser's subscription and payment for and continued beneficial ownership of
the Securities, will not violate any applicable securities or other laws of the
Purchaser's jurisdiction.
5. COVENANTS OF THE COMPANY. The Company covenants and agrees with each
Purchaser that:
5.1 COMPLIANCE. The Company shall comply with all laws, rules,
regulations and orders, the non-compliance with which could materially and
adversely affect the financial condition, assets, liabilities, operations or
financial performance of the Company or its obligations under this Agreement or
any other agreement with each Purchaser.
5.2 PERFORMANCE. The Company shall diligently observe and perform
or cause to be observed all covenants to be observed or performed under the
Transaction Documents and under any other agreement between the Company and each
Purchaser.
5.3 BOOKS AND RECORDS. The Company shall maintain complete and
accurate records and books of account in which entries shall be made in
accordance with generally accepted accounting principles consistently applied,
reflecting all transactions of the Company and its subsidiaries, if any.
5.4 RENEWALS AND GOOD STANDING. The Company shall (a) do all things
necessary to obtain, promptly renew and maintain in good standing from time to
time, all approvals, leases, licenses, permits and consents as are required to
own, develop and operate the business, assets or operations of the Company and
undertaking, except where the failure to obtain, renew or maintain in good
standing such approvals, leases, licenses, permits and consents is not
reasonably likely to result in a material adverse change in the Company's
financial
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condition, assets, liabilities, operations or financial performance and (b)
perform its obligations under this Agreement and all other agreements between
the Company and each Purchaser.
5.5 PRINCIPLE BUSINESS. Prior to the initial public offering of the
Company's Common Stock, the Company shall not change its principal business or
engage in any other business from that which it is engaged on the date of this
Agreement without the written consent of at least two-thirds of the holders of
shares of Stock converted or convertible into Common Stock.
5.6 PROPRIETARY INFORMATION AND ASSIGNMENT AGREEMENT. The Company
shall require all future officers, directors and employees of the Company and
each subsidiary of the Company to execute and deliver a proprietary information
and assignment agreement and shall require all future consultants and
independent contractors to the Company to execute and deliver a consulting
agreement which provides substantially similar protection from misappropriation
to the intellectual property of the Company.
5.7 STOCK OPTIONS. All stock options granted by the Company shall
have a term of ten (10) years and shall be exercisable, over time, based upon
continued employment over a vesting period to be determined by the Company's
Board of Directors. The per share exercise price of all options granted by the
Company will be no less than the fair market value on the date of grant as
determined by the Board of Directors in good faith. Unless otherwise
specifically approved by the Board of Directors, options granted by the Company
will not accelerate upon a change of control of the Company or any subsidiary of
the Company.
5.8 SECURITIES FILINGS. Within the prescribed time after the
Closing, the Company shall file all documents and take all proceedings required
to be taken by it to permit the Stock to be distributed to each Purchaser in
compliance with applicable federal and state securities laws and the applicable
securities legislation in Canada.
5.9 INVESTMENT OF FUNDS. The Company shall not make any investments
in any securities, other than high grade commercial paper or other form of
comparable security.
5.10 DIRECTORS' AND OFFICERS' INSURANCE. Within 45 days after the
Closing, the Company agrees to have in place Directors' and Officers' insurance,
from a reputable organization, of such type and amount as a comparable company
in its industry.
5.11 SURVIVAL OF COMPANY'S COVENANTS. The covenants of the Company
set forth in this Section 5 will survive the completion of the transactions
contemplated by this Agreement and will continue in full force and effect for
the benefit of each Purchaser until the earlier to occur of (a) five (5) years
from the Closing, or (b) the consummation of a firm commitment underwritten
public offering by the Company of shares of its Common Stock pursuant to a
registration statement under the Securities Act, the public offering price of
which is not less than $11.60 per share (appropriately adjusted for any stock
split, dividend, combination or other recapitalization) and which results in
aggregate gross cash proceeds to the Company of
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at least $30,000,000 (before underwriting discounts and commissions).
6. CONDITIONS OF THE PURCHASERS' OBLIGATIONS AT THE CLOSING. The
obligations of each Purchaser to the Company under this Agreement are subject to
the fulfillment, on or before the Closing, of each of the following conditions,
unless otherwise waived:
6.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company contained in Section 2 shall be true and correct in
all material respects on and as of the Closing with the same effect as though
such representations and warranties had been made on and as of the date of the
Closing.
6.2 PERFORMANCE. The Company shall have performed and complied in
all material respects with all covenants, agreements, obligations and conditions
contained in this Agreement that are required to be performed or complied with
by it on or before the Closing.
6.3 COMPLIANCE CERTIFICATE. The President or CEO of the Company
shall deliver to the Purchasers at the Closing a certificate certifying that the
conditions specified in Sections 6.1 and 6.2 have been fulfilled.
6.4 QUALIFICATIONS. All authorizations, approvals or permits, if
any, of any governmental authority or regulatory body of the United States or of
any state that are required to be obtained prior to the Closing in connection
with the lawful issuance and sale of the Stock pursuant to this Agreement shall
be obtained and effective as of the Closing.
6.5 WRITTEN CONSENTS. The Company shall have obtained and delivered
to the Purchasers any and all written waivers, permits, consents and approvals
required to be obtained prior to the Closing in connection with the consummation
of the transactions contemplated by the Transaction Documents in a form and
content reasonably acceptable to the Purchasers.
6.6 STOCK CERTIFICATES. The Company shall have delivered to the
Purchasers facsimile copies of executed stock certificates in form and content
acceptable to the Purchasers ("Stock Certificates") and sufficient to transfer
to and vest in each Purchaser good and valid title to the purchased Stock free
of any lien created by or through the Company. Within one (1) business day after
the Closing, the Company shall deliver the original stock certificates to the
Purchasers.
6.7 RESTATED CERTIFICATE. The Company shall have filed the Restated
Certificate with the Secretary of State of the State of Delaware on or prior to
the Closing, which shall continue to be in full force and effect as of the
Closing.
6.8 RESTATED INVESTORS' RIGHTS AGREEMENT. The Company, each
Purchaser, Creo SRL and the holders of a majority of the outstanding shares of
the Company's Series C Preferred Stock shall have executed and delivered the
Restated Investors' Rights Agreement in substantially the form attached as
Exhibit D.
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6.9 RESTATED CO-SALE AGREEMENT. The Company, each Purchaser, the
holders of a majority of the outstanding Founders Shares (as defined in the
Restated Co-Sale Agreement), Creo SRL and the holders of a majority of the
Company's Series C and C-1 Preferred Stock shall have executed and delivered the
Restated Co-Sale Agreement in substantially the form attached as Exhibit F.
6.10 RESTATED VOTING AGREEMENT. The Company, each Purchaser, the
holders of a majority of the outstanding Founders Shares (as defined in the
Restated Voting Agreement), Creo SRL and the holders of a majority of the
Company's Series C and C-1 Preferred Stock shall have executed and delivered the
Restated Voting Agreement in substantially the form attached as Exhibit E.
6.11 CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT.
The Company and each of its Service Providers (other than as set forth on
Section 2.10 of the Schedule of Exceptions) shall have entered into a
Confidential Information and Invention Assignment Agreement, in substantially
the form provided to the Purchasers.
6.12 NO MATERIAL ADVERSE CHANGE. Except as set forth on the
Schedule of Exceptions, there shall have been no material adverse change in the
Company's financial condition, assets, liabilities, operations or financial
performance since December 31, 1999 (it being understood that none of the
following shall be deemed, in and of itself, to constitute a material adverse
change in the financial condition, assets, liabilities, operations or financial
performance of the Company since December 31, 1999: (a) a change that results
from conditions generally affecting the U.S. economy or the world economy, (b) a
change that results from conditions generally affecting the Company's industry,
(c) a change that results from the announcement or pendency of the transactions
contemplated hereby and (d) a change that results from the taking of any action
required by this Agreement).
6.13 COMPANY LEGAL OPINIONS. Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP,
special counsel for the Company, shall have delivered a legal opinion to the
Purchasers in the form attached hereto as Exhibit I, and Xxxxxx D'Xxxxxx,
counsel for the Company, shall have delivered a legal opinion to the Purchasers
in the form attached hereto as Exhibit J.
6.14 NO LITIGATION. There shall be no action, suit or proceeding or
investigation instituted or threatened to set aside the transactions provided
for herein or to enjoin or prevent the consummation of the transactions
contemplated hereby.
6.15 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated hereby and all documents and
instruments incident to such transactions shall be in form and substance
satisfactory to each Purchaser and its counsel and each Purchaser shall have
received all such counterpart originals or certified or other copies of such
documents as it may reasonably request.
6.16 CLOSING OF COMMON STOCK FINANCING. The transactions
contemplated by
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that certain Common Stock Purchase Agreement, dated as of the date hereof, among
the Company, Creo SRL and the other investors listed on Exhibit A thereto (the
"Common Stock Purchase Agreement"), shall close simultaneous with the
transactions contemplated hereby.
6.17 CLOSING DOCUMENTS. The Company shall have delivered the
following documents to each of the Purchasers:
(a) copies certified by the Secretary of the Company of the
resolutions duly adopted by the Company's board of directors authorizing and
approving: (i) the execution, delivery and performance of the Transaction
Documents and each of the other agreements contemplated hereby, (ii) the
Restated Certificate and the filing of the Restated Certificate with the
Secretary of the State of Delaware, (iii) the reservation for issuance upon
conversion of the Series D Preferred Stock of an aggregate number of shares of
Common Stock equal to the total number of shares initially issuable upon
conversion, (iv) the issuance and sale of the Series D Preferred Stock, and (v)
the consummation of all other transactions contemplated by the Transaction
Documents;
(b) copies certified by the Secretary of the Company of the
resolutions of the Company's stockholders authorizing and approving the Restated
Certificate and the filing of the Restated Certificate with the Delaware
Secretary of the State;
(c) copies certified by the Secretary of the Company of the
Restated Certificate (as filed with the Delaware Secretary of the State) and the
Company's Bylaws, each as in effect at the Closing;
(d) a good standing certificate with respect to the Company
from the Delaware Secretary of State; and
(e) such other documents relating to the transactions
contemplated by this Agreement as the Purchasers or their counsel may reasonably
request.
6.18 GENERAL.
(a) Each Purchasers' obligations under Section 1 shall be
contingent upon the performance by each other Purchaser of its obligations under
Section 1.
(b) In any event the Purchasers may in their sole discretion
waive any conditions to the Closing and close. No such waiver shall be effective
unless it shall be in writing and signed by each Purchaser.
7. CONDITIONS OF THE COMPANY'S OBLIGATIONS AT THE CLOSING. The
obligations of the Company to each Purchaser under this Agreement are subject to
the fulfillment, on or before the Closing, of each of the following conditions,
unless otherwise waived:
7.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of
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each Purchaser contained in Section 4 shall be true and correct in all material
respects on and as of the Closing with the same effect as though such
representations and warranties had been made on and as of the Closing.
7.2 PERFORMANCE. All covenants, agreements and conditions contained
in this Agreement to be performed by the Purchasers on or prior to the Closing
shall have been performed or complied with in all material respects.
7.3 QUALIFICATIONS. All authorizations, approvals or permits, if
any, of any governmental authority or regulatory body of the United States or of
any state that are required in connection with the lawful issuance and sale of
the Stock pursuant to this Agreement shall be obtained and effective as of the
Closing.
8. MISCELLANEOUS.
8.1 SURVIVAL OF WARRANTIES. Unless otherwise set forth in this
Agreement, the warranties and representations of the Company contained in
Section 2 hereof shall survive the execution and delivery of this Agreement and
the Closing for a period of two (2) years following the Closing.
8.2 ENTIRE AGREEMENT. This Agreement and the other Transaction
Documents constitute the entire agreement between the Company and the Purchasers
relative to the subject matter hereof and thereof. Any previous agreement or
negotiations between the Company and the Purchasers concerning the subject
matter hereof is superseded by this Agreement and the Transaction Documents
except for any agreements relating to confidentiality.
8.3 TRANSFER; SUCCESSORS AND ASSIGNS. The terms and conditions of
this Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
8.4 GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
Delaware, without giving effect to principles of conflicts of law.
8.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
8.6 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
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8.7 NOTICES. Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient upon delivery, when delivered
personally or by overnight courier or sent by telegram or fax, or five (5) days
after being deposited in the U.S. mail, as certified or registered mail, with
postage prepaid, addressed to the party to be notified at such party's address
as set forth on the signature page or Exhibit A hereto, or as subsequently
modified by written notice, and if to the Company, with a copy (not constituting
notice) to Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP, 000 Xxxxxxx Xxxx, Xxxxx 0000,
Xxxxxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxx Xxxxxx.
8.8 FINDER'S FEE. Each party represents that it neither is nor will
be obligated for any finder's fee or commission in connection with this
transaction except as set forth on the Schedule of Exceptions. Each Purchaser
agrees to indemnify and to hold harmless the Company from any liability for any
commission or compensation in the nature of a finder's fee (and the costs and
expenses of defending against such liability or asserted liability) for which
such Purchaser or any of its officers, employees, or representatives is
responsible. The Company agrees to indemnify and hold harmless each Purchaser
from any liability for any commission or compensation in the nature of a
finder's fee (and the costs and expenses of defending against such liability or
asserted liability) for which the Company or any of its officers, employees or
representatives is responsible.
8.9 ATTORNEY'S FEES. If any action at law or in equity (including
arbitration) is necessary to enforce or interpret the terms of any of the
Transaction Documents, the prevailing party shall be entitled to reasonable
attorney's fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled.
8.10 AMENDMENTS AND WAIVERS OF AGREEMENT. Any term of this
Agreement may be amended or waived only with the written consent of the Company
and at least a majority of the holders of shares of Stock converted or
convertible into the Common Stock. Any amendment or waiver effected in
accordance with this Section 8.10 shall be binding upon the Purchasers and each
transferee of the Stock (or the Common Stock issuable upon conversion thereof),
each future holder of all such securities, and the Company.
8.11 SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a) such
provision shall be excluded from this Agreement, (b) the balance of this
Agreement shall be interpreted as if such provision were so excluded and (c) the
balance of this Agreement shall be enforceable in accordance with its terms.
8.12 DELAYS OR OMISSIONS. No delay or omission to exercise any
right, power or remedy accruing to any party under this Agreement, upon any
breach or default of any other party under this Agreement, shall impair any such
right, power or remedy of such non-breaching or non-defaulting party nor shall
it be construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall
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any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of any party of any
breach or default under this Agreement, or any waiver on the part of any party
of any provisions or conditions of this Agreement, must be in writing and signed
by the party charged with such waiver and such waiver shall be effective only to
the extent specifically set forth in such writing. All remedies, either under
this Agreement or by law or otherwise afforded to any party, shall be cumulative
and not alternative.
8.13 CONFIDENTIALITY. Each party hereto agrees that, except with
the prior written permission of the other party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any
confidential information, knowledge or data concerning or relating to the
business or financial affairs of the other parties to which such party has been
or shall become privy by reason of this Agreement, discussions or negotiations
relating to this Agreement, the performance of its obligations hereunder or the
ownership of Stock purchased hereunder; provided, however, that the receiving
party may disclose such information (i) on a confidential basis to its
attorneys, accountants, consultants and other professionals to the extent
necessary to obtain their services in connection with its investment in the
Company, (ii) to any prospective purchaser of Stock from the such receiving
party as long as such prospective purchaser agrees in writing to be bound by the
provisions of this Section 8.13, (iii) on a confidential basis to any affiliate
or partner of such receiving party and (iv) as required by judicial decree or
applicable law. The provisions of this Section 8.13 shall be in addition to, and
not in substitution for, the provisions of any separate nondisclosure agreement
executed by the parties hereto with respect to the transactions contemplated
hereby.
8.14 EXCULPATION AMONG PURCHASERS. Each Purchaser acknowledges that
it is not relying upon any person, firm or corporation, other than the Company
and its officers and directors, in making its investment or decision to invest
in the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable to any other Purchaser for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the
purchase of the Securities.
8.15 INDEMNIFICATION. The Company shall defend, indemnify and hold
the Purchasers harmless from and against any and all claims, liabilities,
damages, losses and expenses, including reasonable attorney's fees and expenses
and costs of suit, arising out of any breach of the representations and
warranties, and out of any and all breaches of covenants, warranties,
stipulations, agreements and certifications made by or on behalf of the Company,
in the Transaction Documents or in any document delivered hereunder or
thereunder.
8.16 PRESS RELEASE. Upon the consummation of the transactions
contemplated hereby, the Company may issue a press release identifying Mellon
Ventures, II, L.P. ("Mellon") and/or Hewlett-Packard as a Purchaser, subject to
the prior approval by Mellon and/or Hewlett-Packard, as applicable, of such
press release, which approval will not be unreasonably withheld.
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8.17 USE OF PROCEEDS. The proceeds the Company shall receive upon
the consummation of the transactions contemplated hereby shall be solely used
for product development, working capital and other general corporate purposes
and not for investment purposes other than high grade commercial paper or other
instruments.
[Signature Pages Follow]
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The parties have executed this Series D Preferred Stock Purchase
Agreement as of the date first written above.
COMPANY:
PRINTCAFE, INC.
By:
Name:
Title:
Address: 00 00xx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: President
Fax: (000) 000-0000
[SIGNATURE PAGE TO THE PURCHASE AGREEMENT]
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PURCHASERS:
MELLON VENTURES II, L.P.
By its general partner
MVMA II L.P.
By its general partner
MVMA Inc.
By:
Xxxx Xxxxx, Senior Associate
[SIGNATURE PAGE TO THE PURCHASE AGREEMENT]
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EXHIBITS
Exhibit A - Schedule of Purchasers
Exhibit B - Form of Amended and Restated Certificate of Incorporation
Exhibit C - Schedule of Exceptions to Representations and Warranties
Exhibit D - Form of Restated Investors' Rights Agreement
Exhibit E - Restated Voting Agreement
Exhibit F - Form of Restated Co-Sale Agreement
Exhibit G - Financial Statements
Exhibit H - Form of Bylaws
Exhibit I - Form of Opinion of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
Exhibit J - Form of Opinion of Xxxxxx D'Xxxxxx
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EXHIBIT A
SCHEDULE OF PURCHASERS
NO. OF SHARES OF NO. OF SHARES OF SERIES
NAME/ADDRESS/FAX NO. SERIES D PREFERRED STOCK D-1 PREFERRED STOCK
-------------------- ------------------------ -------------------
Mellon Ventures II, L.P. 58,125 225,000
c/o Mellon Ventures, Inc.
Attn: Xxxx Xxxxx
Xxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
X-00
00
XXXXXXX X
FORM OF AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
B-31
32
EXHIBIT C
SCHEDULE OF EXCEPTIONS TO
REPRESENTATIONS AND WARRANTIES
C-32
33
EXHIBIT D
FORM OF RESTATED INVESTORS' RIGHTS AGREEMENT
D-33
34
EXHIBIT E
FORM OF RESTATED VOTING AGREEMENT
E-34
35
EXHIBIT F
FORM OF RIGHT OF FIRST REFUSAL
AND RESTATED CO-SALE AGREEMENT
F-35
36
EXHIBIT G
FINANCIAL STATEMENTS
G-36
37
EXHIBIT H
FORM OF BYLAWS
H-37
38
EXHIBIT I
FORM OF OPINION OF XXXXXX, XXXXXXXXXX & XXXXXXXXX LLP
I-38
39
EXHIBIT J
FORM OF OPINION OF XXXXXX D'XXXXXX
J-39
