EXHIBIT 10.16
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated this 1st day of March 2000, between ebaseOne
Corporation, a Delaware corporation, currently having its principal place of
business at 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000 (the "Company"), and
Xxxxxx Xxxxx (the "Executive") an individual currently residing at 0000 Xxxxx
Xxxx Xxxxx, Xxxxxxxxxxx, Xxxxx 00000.
WHEREAS, the Company desires to employ Executive and Executive desires to
be employed by the Company, as Senior Vice President of Sales.
WHEREAS, the Executive is willing to enter into an agreement with the
Company upon the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and covenants herein
contained, the parties hereto agree as follows:
1. Term of Agreement. Subject to the terms and conditions hereof, the term of
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employment of the Executive under this Employment Agreement shall be for the
period commencing on the date hereof (the "Commencement Date") and terminating
on February 28, 2003, unless sooner terminated as provided in accordance with
the provisions of Section 5 hereof. (Such term of employment is herein
sometimes called the "Employment Term.")
2. Employment. As of the Commencement Date, the Company hereby agrees to
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employ the Executive as Senior Vice President of Sales of the Company, and the
Executive hereby accepts such employment and agrees to perform his duties and
responsibilities hereunder in accordance with the terms and conditions
hereinafter set forth.
3. Duties and Responsibilities.
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(a) Duties. Executive shall perform such duties as are usually performed by a
Senior Vice President of Sales of a business similar in size and scope as
the Company and such other reasonable additional duties as may be
prescribed from time-to-time by the Company's Chief Executive Officer (the
"CEO") which are reasonable and consistent with the Company's operations,
taking into account Executive's expertise and job responsibilities, which
shall include, but not be limited to, (i) the development, implementation
and management of a sales plan for the Company's application hosting
services, (ii) the development of a target account list, sales and other
forecasts, development and management of the Company's distribution
channels and coordination with Company management, accounting and marketing
personnel, and (iii) the creation and management of a geographically based
national direct sales organization.
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Executive shall maintain a current listing of all customers and potential
customers serviced by Executive. All such records shall be the property of
the Company and subject to the restrictions in Sections 6 and 8 hereof.
This Agreement shall survive any job title or responsibility change agreed
to by Executive. Executive shall report directly to the CEO of the Company
regarding implementation of all business matters. All actions of
Executive shall be subject and subordinate to the review and approval of
the CEO. No other person or group shall be given authority to supervise or
direct Executive in the performance of his duties.
(b) Devotion of Time. During the term of this Agreement, Executive agrees to
devote sufficient time and attention during normal business hours to the
business and affairs of the company to the extent necessary to discharge
the responsibilities assigned to Executive and to use reasonable best
efforts to perform faithfully and efficiently such responsibilities.
4. Compensation and Benefits During the Employment Term:
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(a) Base Compensation. The Executive's base compensation shall be $195,000 per
annum, payable in regular semi-monthly installments in accordance with the
Company's practice for its executives, less applicable withholding for
income and employment taxes as required by law and other deductions as to
which the Executive shall agree. Such base compensation shall be subject
to increases as and when determined by the Company's CEO in his or her sole
discretion and approved by the Company's board of directors.
(b) Bonus Compensation. In addition to the Executive's base compensation,
Executive will be entitled to performance bonuses determined as follows:
(i) For the twelve month period from the commencement date through
February 28, 2001, ebaseOne will pay Xx. Xxxxx an additional $25,000
after accomplishing the following MBO's:
a) Work with the CEO to create a 12, 24 and 36 month sales forecast.
b) Work with the CEO and other members of the executive staff to
create a field sales organizational framework, budget and hiring
schedule.
c) Create a sales organization compensation plan.
d) Create a formal sales process utilizing either SalesLogix or
Great Plains/Front Office as the sales force automation system.
e) Establish a Regional Sales Manger for the Southwest Region
(includes deciding whether or not to retain the current ebaseOne
Director of Sales).
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f) Establish at least 3 sales professionals for the Southwest Region
(includes deciding whether or not to retain the current ebaseOne
sales staff).
g) Hire a Regional Sales Manager for the Central Region.
h) Hire at least 3 additional sales professionals for the Central
Region.
(ii) For the twelve month period from the commencement date through
February 28, 2001, ebaseOne will pay Xx. Xxxxx an additional $25,000
after accomplishing the following MBO's:
a) Establish at least 1 major reference account with a written case
study reading for marketing literature for each of the ebaseOne
products, including SalesLogix, GreatPlains and Logility.
b) Hire a Sales Manager for the East Coast
c) Hire at least 3 additional sales professionals for the East Coast
d) Establish at least 1 major reference account with a written case
study reading for marketing literature that is utilizing more
than one of ebaseOne's products, including SalesLogix, Great
Plains and/or Logility.
e) Hire a Sales Manager for the Southeast
f) Hire at least 3 additional sales professionals for the Southeast
(iii) For the twelve month period from the commencement date through
February 28, 2001, ebaseOne will pay Xx. Xxxxx an additional $25,000
after accomplishing the following MBO's:
a) Work with the executive team as required to create a sales force
training curriculum which covers all of the ebaseOne products,
services and sales processes.
b) Conduct an initial sales force training class, in Houston,
covering the curriculum as created in the above paragraph a.
c) Work with the executive team to organize and maintain a customer
advisory board program
d) Conduct an initial customer advisory board meeting in Houston
with at least 5 customers present and active.
(iv) For the twelve month period from the commencement date through
February 28, 2001, ebaseOne will pay Xx. Xxxxx an additional $25,000
after accomplishing the following MBO's:
a) Establish a second major reference account with a case study
for each of the ebaseOne products, including SalesLogix,
GreatPlains and Logility.
b) Establish a second major reference account with a case study that
is utilizing more than one of ebaseOne's products, including
SalesLogix, Great Plains and/or Logility.
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(c) Have functional Sales Managers in each of the sales regions,
including the Southwest, the Southeast, the East Coast, the
Central and the West Coast.
(e) Have at least 4 additional functional sales professionals (The
Regional Manager plus 4 additional) in each of the sales regions,
including the Southwest, the Southeast, the East Coast, the
Central and the West Coast.
(v) For the twelve-month period of the Commencement Date through February
28, 2001, Executive shall be entitled to a 1% commission for organic
sales generated by Executive, which are collected during the period.
The commission will be computed on the actual sales price paid by the
customer. Computation of the commission shall not include any sales
resulting from any acquisition completed by the Company during the
period. Any such commission shall be payable to the Executive on or
before March 31, 2001.
(vi) Bonuses for subsequent 12 month period shall be in amounts no less
than those attained in the initial 12 month period with the details
of the MBO's and percentages of sales and/or other performance goals
being determined jointly by the CEO and the Executive with approval
by the Company's board of directors. Determination of said MBO's and
performance criteria shall occur no later than the end of the month
of the beginning of the subsequent 12 months periods.
(c) Warrants. The Executive will be entitled to receive five year warrants to
purchase an aggregate 1,000,000 shares of Company common stock having the
terms set forth in the warrant agreements attached hereto as Exhibit "A."
(d) Expense Reimbursement. The Executive shall be entitled to reimbursement of
all reasonable, ordinary and necessary business related expenses incurred
by him in the course of his duties and upon compliance with the Company's
procedures. In addition, The Company will provide the Executive with
corporate housing in Houston for a period of 6 months from the Commencement
Date. Further, the Company will pay up to $20,000 for the Executive to
move his family to Houston.
(e) Participation in Employee Benefit Plans. Executive shall be entitled to
participate, subject to eligibility and other terms generally established
by the Company's board or directors, in any employee benefit plan
[including but not limited to life insurance plans, stock option plans,
group hospitalization, health, dental care (which health insurance shall
also cover Executive's dependents) profit sharing, pension and other
benefit plans], as may be adopted or amended by the Company from time-to-
time.
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5. Termination. Subject to the notice and other provisions of this Section 5,
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the Company shall have the right to terminate the Executive's employment with
the Company, and the Executive shall have the right to resign from such
employment, at any time and for no stated reason.
(a) Disability. The Company shall have the right to terminate the employment
of the Executive under this Agreement for disability in the event Executive
suffers an injury, illness or incapacity as defined in the Company's Long
Term Disability Insurance Policy in effect as of the date hereof for a
period of more than six (6) months provided that during such six month
period the Company shall have given at least ten (10) days written notice
of termination; provided further, however, that if the Executive is
eligible to receive disability payments pursuant to a disability policy
paid for by the Company, the Executive shall assign such benefits to the
Company for all periods as to which he is receiving full payment under this
Agreement. Provided however, if Executive is determined to be disabled,
as defined within the Americans with Disabilities Act, the Company will
make reasonable accommodations, including but not limited to the following:
(i) job restructuring; (ii) modification of work schedules, (iii) job
reassignments, (iv) acquisition of devices to help accommodate an
individual with a disability; and (v) use of interpreters or other support
personnel for an individual with a disability.
(b) Death. This Agreement shall terminate upon the death of Executive.
(c) With Cause. The Company may terminate this Agreement effective upon
delivery of written notice to Executive given at any time (without any necessity
for prior notice) if any of the following shall occur:
(i) any material breach of Executive's obligations of this Agreement,
not cured after ten (10) days notice from the board of directors;
(ii) Executive's gross negligence in the performance of his duties
hereunder;
(iii) any material acts or events which may inhibit Executive from fully
performing his responsibilities to the Company in good faith, and
upon which the board of directors in the exercise of its reasonable
judgment, determines that the Executive has committed any of the
following: (w) a felony criminal conviction; (x) any other criminal
conviction involving Executive's lack of honesty or moral turpitude;
(y) drug or alcohol abuse; or (z) acts of dishonesty, gross
carelessness or gross misconduct.
In the event Executive's employment with the Company is terminated pursuant
to items 5(a), (b) or (c), Executive or his beneficiary shall be entitled to
receive all base compensation earned by Executive up to the date of termination,
all unreimbursed expenses, and any bonus earned in respect of a prior year and
not yet paid.
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For a termination by the Company without good cause, Executive shall be
entitled to receive the greater of (i) the remaining base salary at the then
base salary rate for the remainder of the Employment Term or (ii) the base
salary rate for the period of six months, and all unreimbursed expenses, any
bonus earned in respect of a prior year and not yet paid, and the pro rata
portion of any bonus for the current year.
6. Revealing of Trade Secrets, etc. Executive acknowledges the interest of the
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Company in maintaining the confidentiality of information related to its
business and shall not at any time during the Employment Term or thereafter,
directly or indirectly, reveal or cause to be revealed to any person or entity
the supplier lists, customer lists or other confidential business information of
the Company; provided, however, that the parties acknowledge that it is not the
intention of this paragraph to include within its subject matter (a) information
not proprietary to the Company, (b) information which is then in the public
domain, or (c) information required to be disclosed by law.
7. Arbitration. If a dispute should arise regarding this Agreement, all
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claims, disputes, controversies, differences or other matters in question
arising out of this relationship shall be settled finally, completely and
conclusively by arbitration of a single arbitrator in Houston, Texas, in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the "Rules"). Arbitration shall be initiated by written demand.
This agreement to arbitrate shall be specifically enforceable only in the
District Court of Xxxxxx County, Texas. A decision of the arbitrator shall be
final, conclusive and binding on the Company and the Executive, and judgement
may be entered in the District Court of Xxxxxx County, Texas, for enforcement
and other benefits. On appointment, the arbitrator shall then proceed to decide
the arbitration subjects in accordance with the Rules. Any arbitration held in
accordance with this paragraph shall be private and confidential and no person
shall be entitled to attend the hearings except the arbitrator, Executive,
Executive's attorneys, and any designated representatives of the Company and
their respective attorneys. The matters submitted for arbitration, the hearings
and proceedings and the arbitration award shall be kept and maintained in
strictest confidence by Executive and the Company and shall not be discussed,
disclosed or communicated to any persons. On request of any party, the record of
the proceeding shall be sealed and may not be disclosed except insofar, and only
insofar, as may be necessary to enforce the award of the arbitrator and any
judgement enforcing an award. The prevailing party shall be entitled to recover
reasonable and necessary attorneys' fees and costs from the non-prevailing
party.
8. Confidentiality. During the term of this Agreement and thereafter,
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Executive shall keep secret and retain in strictest confidence, and shall not,
without the prior written consent of the board of directors of the Company
furnish, make available or disclose to any third party of use for the benefit
for himself or any third party, and Confidential information. As used in this
Section 8, "Confidential Information" shall mean any information relating to the
business or affairs of the Company, including but not limited to information
relating to financial statement, customer identities, potential customers,
employees, suppliers, servicing methods, equipment, programs, strategies and
information, analyses, profit margins or other proprietary information used by
the
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Company in connection with its business. Executive acknowledges that the
Confidential Information is vital, sensitive, confidential and proprietary to
the Company
(a) The provisions of this Section 8 shall not, however, prohibit Executive
from disclosing to others or using in any manner information that:
(i) has been published or has become part of the public domain other
than by acts, omissions or fault of Executive;
(ii) has been furnished or made known to Executive by third parties
(other than those acting directly or indirectly for or on behalf
of Executive) as a matter of legal right without restriction on
its use or disclosure;
(iii) was in the possession of Executive prior to obtaining such
information from Employer in connection with the performance of
this Agreement; or
(iv) is required to be disclosed by law.
(b) Executive acknowledges that all price lists, sales manuals, catalogs,
binders, customer lists and other customer information, supplier lists,
financial information, and other records or documents containing
Confidential Information prepared by the Executive or coming into
Executive's possession by virtue of Executive's employment by the Company
is and shall remain the property of the Company and that upon termination
of Executive's employment hereunder, Executive shall return immediately to
the Company all such items in his possession, together with all copies
thereof.
9. Covenants Not to Compete.
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(a) Executive's Acknowledgment. Executive agrees and acknowledges that in
order to assure the Company that it will retain its value as a going
concern, it is necessary that Executive undertake not to utilize his
special knowledge of the business and his relationships with customers and
suppliers to compete with the Company. Executive further acknowledges
that:
(i) the Company is and will be engaged in the business;
(ii) Executive will occupy a position of trust and confidence with the
Company prior to the date of this Agreement and, during such
period and Executive's employment under this Agreement, Executive
has, and will become familiar with the Company's trade secrets
and with other proprietary and confidential information
concerning the Company;
(iii) the agreements and covenants contained in this Section 9 are
essential to protect the Company and the goodwill of the
business; and
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(iv) Executive's employment with the Company has special, unique and
extraordinary value to the Company and the Company would be
irreparably damaged if Executive were to provide services to any
person or entity in violation of the provisions of this
Agreement.
(b) Competitive Activities. Executive hereby agrees that for a period
commencing on the date hereof and ending one year following the later of (i)
termination of Executive's employment with the Company for whatever reason, and
(ii) the conclusion of the period, if any, during which the Company is making
payments to Executive, he will not, directly or indirectly, as employee, agent,
consultant, stockholder, director, co-partner or in any other individual or
representative capacity, own, operate, manage, control, engage in, invest in or
participate in any manner in, act as a consultant or advisor to, render services
for (alone or in association with any person, firm, corporation or entity), or
otherwise assist any person or entity (other than the Company) that engages in
or owns, invests in, operates, manages or controls any venture or enterprise
that directly or indirectly engages or proposes in engage in the business of the
manufacturing, distribution or sale of (i) products distributed, sold or
licensed by the Company or services provided by the Company at the time of
termination or (ii) products or services proposed at the time of such
termination to be distributed, sold, licensed or provided by the Company within
the United States (the "Territory"); provided, however, that nothing contained
herein shall be construed to prevent Executive from investing in the stock of
any competing corporation listed on a national securities exchange or traded in
the over-the-counter market, but only if Executive is not involved in the
business of said corporation and if Executive and his associates (as such term
is defined in Regulation 14(A) promulgated under the Securities Exchange Act of
1934, as in effect on the date hereof), collectively, do not own more than an
aggregate of two percent of the stock of such corporation. With respect to the
Territory, Executive specifically acknowledges that the Company has conducted
the business throughout those areas comprising the Territory and the Company
intends to continue to expand the business throughout the Territory.
(c) Blue Pencil. If an arbitrator shall at any time deem the terms of this
Agreement or any restrictive covenant too lengthy or the Territory too
extensive, the other provisions of this Section 9 shall nevertheless stand, the
restrictive period shall be deemed to be the longest period permissible by law
under the circumstances and the Territory shall be deemed to comprise the
largest territory permissible by law under the circumstances. The arbitrator in
each case shall reduce the restricted period and/or the Territory to permissible
duration or size.
10. Opportunities. During his employment with the Company, and for one year
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thereafter, Executive shall not take any action which might divert from the
Company any opportunity learned about by him during his employment with the
Company (including without limitation during the Employment Term) which would be
within the scope of any of the businesses then engaged in or planned to be
engaged in by the Company.
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11. Interference with Relationships. During his employment with the Company,
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and for one year thereafter, Executive shall not, directly or indirectly, as
employee, agent, consultant, stockholder, director, copartner or in any other
individual or representative capacity intentionally solicit or encourage any
present or future customer or supplier of the Company to terminate or otherwise
alter his, her or its relationship with the Company in an adverse manner.
12. Survival. In the even that this Agreement shall be terminated, then
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notwithstanding such termination, the obligations of Executive pursuant to
Sections 6,7,8 9,10, and 11 of this Agreement shall survive such termination.
13. Contents of Agreement, Parties in Interest, Assignment, etc. This
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Agreement sets forth the entire understanding of the parties hereto with respect
to the subject matter hereof. All of the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective heirs, representatives, successors and assigns of the parties hereto,
except that the duties and responsibilities of Executive hereunder which are of
a personal nature shall neither be assigned nor transferred in whole or in part
by Executive. This Agreement shall not be amended except by a written
instrument duly executed by the parties.
14. Severability. If any term or provision of this Agreement shall be held to
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be invalid or unenforceable for any reason, such term or provision shall be
ineffective to the extent of such invalidity or unenforceability without
invalidating the remaining terms and provisions hereof, and this Agreement shall
be construed as if such invalid or unenforceable term or provision had not been
contained herein.
15. Notices. Any notice, request, instruction or other document to be given
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hereunder by any party to the other party shall be in writing and shall be
deemed to have been duly given when delivered personally or five (5) days after
dispatch by registered or certified mail, postage prepaid, return receipt
requested, to the party to whom the same is so given or made:
If to the Company addressed to:
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Xxxxxxx X. Xxxxxxx
ebaseOne Corporation
0000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000
with a copy to:
Xxxxxx X. Xxxxxxxxx
Xxxxxx & Xxxxxxxxx, P.C.
0000 Xxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
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If to Executive addressed to:
_________________________
_________________________
_________________________
or to such other address as the one party shall specify to the other party in
writing.
16. Counterparts and Headings. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed an original and all which together
shall constitute one and the same instrument. All headings are inserted for
convenience of reference only and shall not affect the meaning or interpretation
of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
EBASEONE CORPORATION
By: /s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
Director and Chief Executive Officer
EXECUTIVE
By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx
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WARRANT
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933 ("ACT")
OR APPLICABLE STATE SECURITIES LAWS ("STATE ACTS") AND SHALL NOT BE SOLD,
PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR
CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A
FAVORABLE OPINION OF COUNSEL OR SUBMISSION TO THE COMPANY OF SUCH EVIDENCE AS
MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EACH SUCH CASE, TO THE EFFECT
THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE ACT AND THE STATE ACTS.
WARRANT TO PURCHASE 500,000 SHARES OF COMMON STOCK
EBASEONE CORPORATION
(a Delaware corporation)
0000 Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Not Transferable or Exercisable Except
upon Conditions Herein Specified
EBASEONE CORPORATION, a Delaware corporation ("Company"), hereby certifies
that Xxxxxx Xxxxx, his registered successors and permitted assigns registered on
the books of the Company maintained for such purposes, as the registered holder
hereof ("Holder"), for value received in consideration for services rendered to
the Company, the receipt of which is acknowledged, is entitled to purchase from
the Company the number of fully paid and non-assessable shares of Common Stock
of the Company, $.001 par value ("Shares" or Common Stock"), stated above at the
purchase price per Share set forth in Section 1(b) below ("Exercise Price") (the
number of Shares and Exercise Price being subject to adjustment as hereinafter
provided) upon the terms and conditions herein provided.
1. Exercise of Warrants.
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(a) Subject to subsection (b) of this Section 1, upon presentation
and surrender of this Warrant Certificate, with the attached Purchase Form duly
executed, at the principal office of the Company, or at such other place as the
Company may designate by notice to the Holder hereof, together with a certified
or bank cashiers check payable to the order of the Company in the amount of the
Exercise Price times the number of Shares being purchased, the Company shall
deliver to the Holder hereof, as promptly as practicable, certificates
representing the Shares being purchased. This Warrant may be exercised in whole
or in part; and, in case of exercise hereof in part only, the Company, upon
surrender hereof, will deliver to the Holder a new Warrant Certificate or
Warrant Certificates of like tenor entitling the Holder to purchase the number
of Shares as to which this Warrant has not been exercised.
(b) This Warrant may be exercised at a price of $7.94 per share and
become exercisable as the underlying Shares vest (in the manner as set forth in
(d) below). The Warrant shall expire upon the close of business March 1, 2005.
(c) The Warrant Price shall be payable at the time of exercise. The
Warrant Price may be paid in cash (by check) or by: (i) surrender of shares of
Common Stock of the Company already owned by the Executive, having a Market
Price (as defined below) equal to the exercise price of the Warrant; (ii)
provided that a public market for the Company's stock exists, through a "same
day sale" commitment from the Holder and a broker-dealer that is a member of the
National Association of Securities Dealers, Inc. (an "NASD Dealer") whereby the
Holder irrevocably elects to exercise the Warrant and to sell a portion of the
Shares so purchased to pay for the exercise price and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward the exercise price
directly to the Company; (iii) provided that a public market for the Company's
stock exists, through a "margin" commitment from the Holder and an NASD Dealer
whereby the Holder irrevocably elects to exercise the Warrant and to pledge the
Shares so purchased to the NASD Dealer in the amount of the exercise price, and
whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
forward the exercise price directly to the Company; (iv) upon surrender of the
Warrant at the principal office of the Company together with notice of election,
in which event the Company shall issue Holder a number of Shares computed using
the following formula:
X = Y (A-B)/A
where: X = the number of Shares to be issued to Holder (not to exceed the
number of Shares set forth on the cover page of this Warrant
Agreement, as adjusted pursuant to the provisions of Section 6 of this
Warrant Agreement).
Y = the number of Shares for which the Warrant is being exercised.
A = the Market Price of one Share (for purposes of this Section 1(c)),
the "Market Price" shall be defined as the average closing price of
the common stock (if actual sales price information on any trading
day is not available, the closing bid price shall be used) for the
five trading days prior to the Date of Exercise of this Warrant (the
"Average Closing Bid Price"), as reported by the National Association
of Securities Dealers Automated Quotation System ("NASDAQ"), or if the
common stock is not traded on NASDAQ, the Average Closing Bid Price in
the over-the-counter market; provided, however, that if the common
stock is listed on a stock exchange, the Market Price shall be the
Average Closing Bid Price on such exchange; and, provided further,
that if the common stock is not quoted or listed by any organization,
the fair value of the common stock, as determined by the Board of
Directors of the Company, whose determination shall be conclusive,
shall be used).
B = the Exercise Price.
or (v) by any combination of the foregoing.
(d) The Shares underlying the Warrants shall vest, and the Warrants
shall become exercisable with respect to such Shares as follows: (i) one-third
when the Company's hosting revenues and related services reach $12 million or
when the Company's closing bid price according to NASDAQ exceeds $10 for 30
consecutive trading days commencing on march 1, 2000 , (ii) one-third when the
Company's hosting revenues and related services reach $50 million, and (iii)
one-third when the Company's hosting revenues and related services reach $75
million. In the event Holder ceases to be an employee of the Company, for any
reason, all unvested Shares underlying the Warrants shall immediately be
canceled, and the Warrants will entitle Holder to purchase only those Shares
that have vested prior to the date he ceased to be employed by the Company. In
the event of a "change of control" as defined below, all of the Shares
underlying the Warrants shall vest and become immediately exercisable. A change
of control shall mean and include the following transactions or situations:
1. A sale, transfer, or other disposition by the Company through a
single transaction or a series of transactions of securities of the Company
representing fifty (50%) percent or more of the combined voting power of
the Company's then outstanding securities to any "Unrelated Person" or
"Unrelated Persons" acting in concert with one another. For purposes of
this definition, the term "Person" shall mean and include any individual,
partnership, joint venture, association, trust corporation, or other entity
[including a "group" as referred to in Section 13(d)(3) of the Securities
Exchange Act of 1934 ("1934 Act")]. For purposes of this definition, the
term "Unrelated Person" shall mean and include any Person other than the
Company, a wholly-owned subsidiary of the Company, or an employee benefit
plan of the Company; provided however, a sale to underwriters in connection
with a public offering of the Company's securities pursuant to a firm
commitment shall not be a Change of Control.
2. A sale, transfer, or other disposition through a single
transaction or a series of transactions of all or substantially all of the
assets of the Company to an Unrelated Person or Unrelated Persons acting in
concert with one another.
3. A change in the ownership of the Company through a single
transaction or a series of transactions such that any Unrelated Person or
Unrelated Persons acting in concert with one another become the "Beneficial
Owner," directly or indirectly, of securities of the Company representing
at least fifty (50%) percent of the combined voting power of the Company's
then outstanding securities. For purposes of this definition, the term
"Beneficial Owner" shall have the same meaning as given to that term in
Rule 13d-3 promulgated under the 1934 Act, provided that any pledge of
voting securities is not deemed to be the Beneficial Owner thereof prior to
its acquisition of voting rights with respect to such securities.
4. Any consolidation or merger of the Company with or into an
Unrelated
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Person, unless immediately after the consolidation or merger the holders of
the common stock of the Company immediately prior to the consolidation or
merger are the beneficial owners of securities of the surviving corporation
representing at least fifty (50%) percent of the combined voting power of
the surviving corporation's then outstanding securities.
5. During any period of two years, individuals who, at the beginning
of such period, constituted the Board of Directors of the Company cease,
for any reason, to constitute at least a majority thereof, unless the
election or nomination for election of each new director was approved by
the vote of at least two-thirds of the directors then still in office who
were directors at the beginning of such period.
6. A change in control of the Company of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the 1934 Act, or any successor regulation
of similar importance, regardless of whether the Company is subject to such
reporting requirement.
2. Exchange and Transfer of Warrant.
--------------------------------
At any time prior to the exercise hereof, upon presentation and
surrender to the Company, this Warrant (a) may be exchanged, alone or with other
Warrants of like tenor registered in the name of the Holder, for another Warrant
or other Warrants of like tenor in the name of such Holder exercisable for the
same aggregate number of Shares as the Warrant or Warrants surrendered, but (b)
may not be sold, transferred, hypothecated, or assigned, in whole or in part,
without the prior written consent of the Company.
3. Rights and Obligations of Warrant Holder.
----------------------------------------
(a) The Holder of this Warrant Certificate shall not, by virtue
hereof, be entitled to any rights of a stockholder in the Company, either at law
or in equity; provided, however, that in the event that any certificate
-----------------
representing the Shares is issued to the Holder hereof upon exercise of this
Warrant, such Holder shall, for all purposes, be deemed to have become the
holder of record of such Shares on the date on which this Warrant Certificate,
together with a duly executed Purchase Form, was surrendered and payment of the
Exercise Price was made, irrespective of the date of delivery of such Share
certificate. The rights of the Holder of this Warrant are limited to those
expressed herein and the Holder of this Warrant, by his acceptance hereof,
consents to and agrees to be bound by and to comply with all the provisions of
this Warrant Certificate, including, without limitation, all the obligations
imposed upon the Holder hereof by Sections 2 and 5 hereof. In addition, the
Holder of this Warrant Certificate, by accepting the same, agrees that the
Company may deem and treat the person in whose name this Warrant Certificate is
registered on the books of the Company maintained for such purposes as the
absolute, true and lawful owner for all purposes whatsoever, notwithstanding any
notation of ownership or other writing thereon, and the Company shall not be
affected by any notice to the contrary.
4
(b) No Holder of this Warrant Certificate, as such, shall be entitled
to vote or receive dividends or to be deemed the holder of Shares for any
purpose, nor shall anything contained in this Warrant Certificate be construed
to confer upon any Holder of this Warrant Certificate, as such, any of the
rights of a stockholder of the Company or any right to vote, give or withhold
consent to any action by the Company, whether upon any recapitalization, issue
of stock, reclassification of stock, consolidation, merger, conveyance or
otherwise, receive notice of meetings or other action affecting stockholders
(except for notices provided for herein), receive dividends, subscription
rights, or otherwise, until this Warrant shall have been exercised and the
Shares purchasable upon the exercise thereof shall have become deliverable as
provided herein; provided, however, that any such exercise on any date when the
-----------------
stock transfer books of the Company shall be closed shall constitute the person
or persons in whose name or names the certificate or certificates for those
Shares are to be issued as the record holder or holders thereof for all purposes
at the opening of business on the next succeeding day on which such stock
transfer books are open, and the Warrant surrendered shall not be deemed to have
been exercised, in whole or in part as the case may be, until the next
succeeding day on which stock transfer books are open for the purpose of
determining entitlement to dividends on the Company's common stock.
4. Shares Underlying Warrants.
--------------------------
The Company covenants and agrees that all Shares delivered upon exercise of
this Warrant shall, upon delivery and payment therefor, be duly and validly
authorized and issued, fully paid and non-assessable, and free from all stamp
taxes, liens and charges with respect to the purchase thereof. In addition, the
Company agrees at all times to reserve and keep available an authorized number
of Shares sufficient to permit the exercise in full of this Warrant.
5. Disposition of Warrants or Shares.
---------------------------------
(a) The Holder of this Warrant Certificate and any transferee hereof
or of the Shares issuable upon the exercise of the Warrant Certificate, by their
acceptance hereof, hereby understand and agree that the Warrant, and the Shares
issuable upon the exercise hereof, have not been registered under either the
Securities Act of 1933 ("Act") or applicable state securities laws ("State
Acts") and shall not be sold, pledged, hypothecated, or otherwise transferred
(whether or not for consideration) except upon the issuance to the Company of an
opinion of counsel favorable to the Company or its counsel or submission to the
Company of such evidence as may be satisfactory to the Company or its counsel,
in each such case, to the effect that any such transfer shall not be in
violation of the Act or the State Acts. It shall be a condition to the transfer
of this Warrant that any transferee of this Warrant deliver to the Company his
written agreement to accept and be bound by all of the terms and conditions of
this Warrant Certificate. The Holder acknowledges that the Company has not
granted any registration rights hereunder.
(b) The stock certificates of the Company that will evidence the
shares of Common Stock with respect to which this Warrant may be exercisable
will be imprinted with a conspicuous legend in substantially the following form:
5
The securities represented by this certificate have not been
registered under either the Securities Act of 1933 ("Act") or the
securities laws of any state ("State Acts"). Such securities shall not
be sold, pledged, hypothecated, or otherwise transferred (whether or
not for consideration) at any time whatsoever except upon registration
or upon delivery to the Company of an opinion of its counsel
satisfactory to the Company or its counsel that registration is not
required for such transfer or the submission of such other evidence as
may be satisfactory to the Company or its counsel to the effect that
any such transfer shall not be in violation of the Act, State Acts or
any rule or regulation promulgated thereunder.
6. Adjustments.
-----------
The number of Shares purchasable upon the exercise of each Warrant is
subject to adjustment from time to time upon the occurrence of any of the events
enumerated below:
(a) If at any time after the date of this Warrant and so long as this
Warrant is outstanding, there is a stock split, stock dividend, subdivision, or
similar distribution with respect to the Common Stock, or a combination of the
Common Stock, then, in such event, the exercise price shall be adjusted in
accordance with (b) below.
(b) Immediately upon the effective date of any event requiring
adjustment pursuant to (a), the Company shall adjust the exercise price then in
effect (to the nearest whole cent) as follows:
i) in the event such adjustment is caused by stock split, stock
dividend, subdivision, or other similar distribution of shares of
Common Stock, the exercise price in effect, immediately prior to the
effective date of such event shall be decreased to an amount which
shall bear the same relation to the exercise price in effect
immediately prior to such event as the total number of shares of
Common Stock outstanding immediately prior to such event bears to the
total number of shares of Common Stock outstanding immediately after
such event;
ii) in the event such adjustment is caused by a combination of
shares of Common Stock, the exercise price in effect immediately prior
to the close of business on the effective date of such event shall be
increased to an amount which shall bear the same relation to the
exercise price in effect immediately prior to such event as the total
number of shares of Common Stock outstanding immediately prior to such
event bears to the total number of shares of Common Stock outstanding
immediately after such event.
6
(c) Upon each adjustment of the exercise price pursuant to (b) above,
the Warrant outstanding prior to such adjustment in the exercise price shall
thereafter evidence the right to purchase, at the adjusted exercise price, that
number of shares of Common Stock (calculated to the nearest hundredth) obtained
by (i) multiplying the number of shares of Common Stock issuable upon exercise
of the Warrant prior to adjustment of the number of shares of Common Stock by
the exercise price in effect prior to adjustment of the exercise price and (ii)
dividing the product so obtained by the exercise price in effect after such
adjustment of the exercise price.
7. Loss or Destruction.
-------------------
Upon receipt of evidence satisfactory to the Company of the loss,
theft, destruction or mutilation of this Warrant Certificate and, in the case of
any such loss, theft or destruction, upon delivery of an indemnity agreement or
bond satisfactory in form, substance and amount to the Company or, in the case
of any such mutilation, upon surrender and cancellation of this Warrant
Certificate, the Company at its expense will execute and deliver, in lieu
thereof, a new Warrant Certificate of like tenor.
8. Survival.
--------
The various rights and obligations of the Holder hereof as set forth
herein shall survive the exercise of the Warrants represented hereby and the
surrender of this Warrant Certificate.
9. Notices.
-------
Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid (or
similar delivery if outside of the United States), and will be deemed to have
been given or delivered on the date such notice, purchase price or other
communication is so delivered or posted, as the case may be; and, if to the
Company, it will be addressed to the address specified in Section 1 hereof, and
if to the Holder, it will be addressed to the registered Holder at its, his or
her address as it appears on the books of the Company.
EBASEONE CORPORATION
By: /s/ Xxxxxxx Xxxxxxx
______________________________
Xxxxxxx Xxxxxxx, President
Dated: March 1, 2000
HOLDER:
------
7
By: /s/ Xxxxxx Xxxxx
______________________________
Xxxxxx Xxxxx
Dated: March 1, 2000
8
WARRANT
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE
HEREOF HAVE NOT BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933 ("ACT")
OR APPLICABLE STATE SECURITIES LAWS ("STATE ACTS") AND SHALL NOT BE SOLD,
PLEDGED, HYPOTHECATED, DONATED, OR OTHERWISE TRANSFERRED (WHETHER OR NOT FOR
CONSIDERATION) BY THE HOLDER EXCEPT UPON THE ISSUANCE TO THE COMPANY OF A
FAVORABLE OPINION OF COUNSEL OR SUBMISSION TO THE COMPANY OF SUCH EVIDENCE AS
MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EACH SUCH CASE, TO THE EFFECT
THAT ANY SUCH TRANSFER SHALL NOT BE IN VIOLATION OF THE ACT AND THE STATE ACTS.
WARRANT TO PURCHASE 500,000 SHARES OF COMMON STOCK
EBASEONE CORPORATION
(a Delaware corporation)
0000 Xxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Not Transferable or Exercisable Except
upon Conditions Herein Specified
EBASEONE CORPORATION, a Delaware corporation ("Company"), hereby certifies
that Xxxxxx Xxxxx, his registered successors and permitted assigns registered on
the books of the Company maintained for such purposes, as the registered holder
hereof ("Holder"), for value received in consideration for services rendered to
the Company, the receipt of which is acknowledged, is entitled to purchase from
the Company the number of fully paid and non-assessable shares of Common Stock
of the Company, $.001 par value ("Shares" or Common Stock"), stated above at the
purchase price per Share set forth in Section 1(b) below ("Exercise Price") (the
number of Shares and Exercise Price being subject to adjustment as hereinafter
provided) upon the terms and conditions herein provided.
1. Exercise of Warrants.
--------------------
(a) Subject to subsection (b) of this Section 1, upon presentation
and surrender of this Warrant Certificate, with the attached Purchase Form duly
executed, at the principal office of the Company, or at such other place as the
Company may designate by notice to the Holder hereof, together with a certified
or bank cashiers check payable to the order of the Company in the amount of the
Exercise Price times the number of Shares being purchased, the Company shall
deliver to the Holder hereof, as promptly as practicable, certificates
representing the Shares being purchased. This Warrant may be exercised in whole
or in part; and, in case of exercise hereof in part only, the Company, upon
surrender hereof, will deliver to the Holder a new Warrant Certificate or
Warrant Certificates of like tenor entitling the Holder to purchase the number
of Shares as to which this Warrant has not been exercised.
(b) This Warrant may be exercised at a price of $7.94 per share and
become exercisable as the underlying Shares vest (in the manner as set forth in
(d) below). The Warrant shall expire upon the close of business March 1, 2005.
(c) The Warrant Price shall be payable at the time of exercise. The
Warrant Price may be paid in cash (by check) or by: (i) surrender of shares of
Common Stock of the Company already owned by the Executive, having a Market
Price (as defined below) equal to the exercise price of the Warrant; (ii)
provided that a public market for the Company's stock exists, through a "same
day sale" commitment from the Holder and a broker-dealer that is a member of the
National Association of Securities Dealers, Inc. (an "NASD Dealer") whereby the
Holder irrevocably elects to exercise the Warrant and to sell a portion of the
Shares so purchased to pay for the exercise price and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward the exercise price
directly to the Company; (iii) provided that a public market for the Company's
stock exists, through a "margin" commitment from the Holder and an NASD Dealer
whereby the Holder irrevocably elects to exercise the Warrant and to pledge the
Shares so purchased to the NASD Dealer in the amount of the exercise price, and
whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
forward the exercise price directly to the Company; (iv) upon surrender of the
Warrant at the principal office of the Company together with notice of election,
in which event the Company shall issue Holder a number of Shares computed using
the following formula:
X = Y (A-B)/A
where: X = the number of Shares to be issued to Holder (not to exceed the
number of Shares set forth on the cover page of this Warrant
Agreement, as adjusted pursuant to the provisions of Section 6 of this
Warrant Agreement).
Y = the number of Shares for which the Warrant is being exercised.
A = the Market Price of one Share (for purposes of this Section 1(c)),
the "Market Price" shall be defined as the average closing price of
the common stock (if actual sales price information on any trading
day is not available, the closing bid price shall be used) for the
five trading days prior to the Date of Exercise of this Warrant (the
"Average Closing Bid Price"), as reported by the National Association
of Securities Dealers Automated Quotation System ("NASDAQ"), or if the
common stock is not traded on NASDAQ, the Average Closing Bid Price in
the over-the-counter market; provided, however, that if the common
stock is listed on a stock exchange, the Market Price shall be the
Average Closing Bid Price on such exchange; and, provided further,
that if the common stock is not quoted or listed by any organization,
the fair value of the common stock, as determined by the Board of
Directors of the Company, whose determination shall be conclusive,
shall be used).
B = the Exercise Price.
or (v) by any combination of the foregoing.
(d) The Shares underlying the Warrants shall vest, and the Warrants
shall become exercisable with respect to such Shares as follows: (i) one-third
when the Company's hosting revenues and related services reach $12 million or
when the Company's closing bid price according to NASDAQ exceeds $10 for 30
consecutive trading days commencing on march 1, 2000 , (ii) one-third when the
Company's hosting revenues and related services reach $50 million, and (iii)
one-third when the Company's hosting revenues and related services reach $75
million. In the event Holder ceases to be an employee of the Company, for any
reason, all unvested Shares underlying the Warrants shall immediately be
canceled, and the Warrants will entitle Holder to purchase only those Shares
that have vested prior to the date he ceased to be employed by the Company. In
the event of a "change of control" as defined below, all of the Shares
underlying the Warrants shall vest and become immediately exercisable. A change
of control shall mean and include the following transactions or situations:
1. A sale, transfer, or other disposition by the Company through a
single transaction or a series of transactions of securities of the Company
representing fifty (50%) percent or more of the combined voting power of
the Company's then outstanding securities to any "Unrelated Person" or
"Unrelated Persons" acting in concert with one another. For purposes of
this definition, the term "Person" shall mean and include any individual,
partnership, joint venture, association, trust corporation, or other entity
[including a "group" as referred to in Section 13(d)(3) of the Securities
Exchange Act of 1934 ("1934 Act")]. For purposes of this definition, the
term "Unrelated Person" shall mean and include any Person other than the
Company, a wholly-owned subsidiary of the Company, or an employee benefit
plan of the Company; provided however, a sale to underwriters in connection
with a public offering of the Company's securities pursuant to a firm
commitment shall not be a Change of Control.
2. A sale, transfer, or other disposition through a single
transaction or a series of transactions of all or substantially all of the
assets of the Company to an Unrelated Person or Unrelated Persons acting in
concert with one another.
3. A change in the ownership of the Company through a single
transaction or a series of transactions such that any Unrelated Person or
Unrelated Persons acting in concert with one another become the "Beneficial
Owner," directly or indirectly, of securities of the Company representing
at least fifty (50%) percent of the combined voting power of the Company's
then outstanding securities. For purposes of this definition, the term
"Beneficial Owner" shall have the same meaning as given to that term in
Rule 13d-3 promulgated under the 1934 Act, provided that any pledge of
voting securities is not deemed to be the Beneficial Owner thereof prior to
its acquisition of voting rights with respect to such securities.
4. Any consolidation or merger of the Company with or into an
Unrelated Person, unless immediately after the consolidation or merger the
holders of the common stock of the Company immediately prior to the
consolidation or merger are the beneficial owners of securities of the
surviving corporation representing at least fifty (50%) percent of
the combined voting power of the surviving corporation's then outstanding
securities.
5. During any period of two years, individuals who, at the beginning
of such period, constituted the Board of Directors of the Company cease,
for any reason, to constitute at least a majority thereof, unless the
election or nomination for election of each new director was approved by
the vote of at least two-thirds of the directors then still in office who
were directors at the beginning of such period.
6. A change in control of the Company of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the 1934 Act, or any successor regulation
of similar importance, regardless of whether the Company is subject to such
reporting requirement.
2. Exchange and Transfer of Warrant.
--------------------------------
At any time prior to the exercise hereof, upon presentation and
surrender to the Company, this Warrant (a) may be exchanged, alone or with other
Warrants of like tenor registered in the name of the Holder, for another Warrant
or other Warrants of like tenor in the name of such Holder exercisable for the
same aggregate number of Shares as the Warrant or Warrants surrendered, but (b)
may not be sold, transferred, hypothecated, or assigned, in whole or in part,
without the prior written consent of the Company.
3. Rights and Obligations of Warrant Holder.
----------------------------------------
(a) The Holder of this Warrant Certificate shall not, by virtue
hereof, be entitled to any rights of a stockholder in the Company, either at law
or in equity; provided, however, that in the event that any certificate
-----------------
representing the Shares is issued to the Holder hereof upon exercise of this
Warrant, such Holder shall, for all purposes, be deemed to have become the
holder of record of such Shares on the date on which this Warrant Certificate,
together with a duly executed Purchase Form, was surrendered and payment of the
Exercise Price was made, irrespective of the date of delivery of such Share
certificate. The rights of the Holder of this Warrant are limited to those
expressed herein and the Holder of this Warrant, by his acceptance hereof,
consents to and agrees to be bound by and to comply with all the provisions of
this Warrant Certificate, including, without limitation, all the obligations
imposed upon the Holder hereof by Sections 2 and 5 hereof. In addition, the
Holder of this Warrant Certificate, by accepting the same, agrees that the
Company may deem and treat the person in whose name this Warrant Certificate is
registered on the books of the Company maintained for such purposes as the
absolute, true and lawful owner for all purposes whatsoever, notwithstanding any
notation of ownership or other writing thereon, and the Company shall not be
affected by any notice to the contrary.
(b) No Holder of this Warrant Certificate, as such, shall be entitled
to vote or receive dividends or to be deemed the holder of Shares for any
purpose, nor shall anything contained in this Warrant Certificate be construed
to confer upon any Holder of this Warrant Certificate, as
4
such, any of the rights of a stockholder of the Company or any right to vote,
give or withhold consent to any action by the Company, whether upon any
recapitalization, issue of stock, reclassification of stock, consolidation,
merger, conveyance or otherwise, receive notice of meetings or other action
affecting stockholders (except for notices provided for herein), receive
dividends, subscription rights, or otherwise, until this Warrant shall have been
exercised and the Shares purchasable upon the exercise thereof shall have become
deliverable as provided herein; provided, however, that any such exercise on any
-----------------
date when the stock transfer books of the Company shall be closed shall
constitute the person or persons in whose name or names the certificate or
certificates for those Shares are to be issued as the record holder or holders
thereof for all purposes at the opening of business on the next succeeding day
on which such stock transfer books are open, and the Warrant surrendered shall
not be deemed to have been exercised, in whole or in part as the case may be,
until the next succeeding day on which stock transfer books are open for the
purpose of determining entitlement to dividends on the Company's common stock.
4. Shares Underlying Warrants.
--------------------------
The Company covenants and agrees that all Shares delivered upon exercise of
this Warrant shall, upon delivery and payment therefor, be duly and validly
authorized and issued, fully paid and non-assessable, and free from all stamp
taxes, liens and charges with respect to the purchase thereof. In addition, the
Company agrees at all times to reserve and keep available an authorized number
of Shares sufficient to permit the exercise in full of this Warrant.
5. Disposition of Warrants or Shares.
---------------------------------
(a) The Holder of this Warrant Certificate and any transferee hereof
or of the Shares issuable upon the exercise of the Warrant Certificate, by their
acceptance hereof, hereby understand and agree that the Warrant, and the Shares
issuable upon the exercise hereof, have not been registered under either the
Securities Act of 1933 ("Act") or applicable state securities laws ("State
Acts") and shall not be sold, pledged, hypothecated, or otherwise transferred
(whether or not for consideration) except upon the issuance to the Company of an
opinion of counsel favorable to the Company or its counsel or submission to the
Company of such evidence as may be satisfactory to the Company or its counsel,
in each such case, to the effect that any such transfer shall not be in
violation of the Act or the State Acts. It shall be a condition to the transfer
of this Warrant that any transferee of this Warrant deliver to the Company his
written agreement to accept and be bound by all of the terms and conditions of
this Warrant Certificate. The Holder acknowledges that the Company has not
granted any registration rights hereunder.
(b) The stock certificates of the Company that will evidence the
shares of Common Stock with respect to which this Warrant may be exercisable
will be imprinted with a conspicuous legend in substantially the following form:
The securities represented by this certificate have not been
registered under either the Securities Act of 1933 ("Act") or the
securities laws of any state
5
("State Acts"). Such securities shall not be sold, pledged,
hypothecated, or otherwise transferred (whether or not for
consideration) at any time whatsoever except upon registration or upon
delivery to the Company of an opinion of its counsel satisfactory to
the Company or its counsel that registration is not required for such
transfer or the submission of such other evidence as may be
satisfactory to the Company or its counsel to the effect that any such
transfer shall not be in violation of the Act, State Acts or any rule
or regulation promulgated thereunder.
6. Adjustments.
-----------
The number of Shares purchasable upon the exercise of each Warrant is
subject to adjustment from time to time upon the occurrence of any of the events
enumerated below:
(a) If at any time after the date of this Warrant and so long as this
Warrant is outstanding, there is a stock split, stock dividend, subdivision, or
similar distribution with respect to the Common Stock, or a combination of the
Common Stock, then, in such event, the exercise price shall be adjusted in
accordance with (b) below.
(b) Immediately upon the effective date of any event requiring
adjustment pursuant to (a), the Company shall adjust the exercise price then in
effect (to the nearest whole cent) as follows:
i) in the event such adjustment is caused by stock split, stock
dividend, subdivision, or other similar distribution of shares of
Common Stock, the exercise price in effect, immediately prior to the
effective date of such event shall be decreased to an amount which
shall bear the same relation to the exercise price in effect
immediately prior to such event as the total number of shares of
Common Stock outstanding immediately prior to such event bears to the
total number of shares of Common Stock outstanding immediately after
such event;
ii) in the event such adjustment is caused by a combination of
shares of Common Stock, the exercise price in effect immediately prior
to the close of business on the effective date of such event shall be
increased to an amount which shall bear the same relation to the
exercise price in effect immediately prior to such event as the total
number of shares of Common Stock outstanding immediately prior to such
event bears to the total number of shares of Common Stock outstanding
immediately after such event.
(c) Upon each adjustment of the exercise price pursuant to (b) above,
the Warrant outstanding prior to such adjustment in the exercise price shall
thereafter evidence the right to purchase, at the adjusted exercise price, that
number of shares of Common Stock (calculated to the nearest hundredth) obtained
by (i) multiplying the number of shares of Common Stock issuable upon
6
exercise of the Warrant prior to adjustment of the number of shares of Common
Stock by the exercise price in effect prior to adjustment of the exercise price
and (ii) dividing the product so obtained by the exercise price in effect after
such adjustment of the exercise price.
7. Loss or Destruction.
-------------------
Upon receipt of evidence satisfactory to the Company of the loss,
theft, destruction or mutilation of this Warrant Certificate and, in the case of
any such loss, theft or destruction, upon delivery of an indemnity agreement or
bond satisfactory in form, substance and amount to the Company or, in the case
of any such mutilation, upon surrender and cancellation of this Warrant
Certificate, the Company at its expense will execute and deliver, in lieu
thereof, a new Warrant Certificate of like tenor.
8. Survival.
--------
The various rights and obligations of the Holder hereof as set forth
herein shall survive the exercise of the Warrants represented hereby and the
surrender of this Warrant Certificate.
9. Notices.
-------
Whenever any notice, payment of any purchase price, or other
communication is required to be given or delivered under the terms of this
Warrant, it shall be in writing and delivered by hand delivery or United States
registered or certified mail, return receipt requested, postage prepaid (or
similar delivery if outside of the United States), and will be deemed to have
been given or delivered on the date such notice, purchase price or other
communication is so delivered or posted, as the case may be; and, if to the
Company, it will be addressed to the address specified in Section 1 hereof, and
if to the Holder, it will be addressed to the registered Holder at its, his or
her address as it appears on the books of the Company.
EBASEONE CORPORATION
By: /s/ Xxxxxxx Xxxxxxx
______________________________
Xxxxxxx Xxxxxxx, President
Dated: March 1, 2000
HOLDER:
------
7
By: /s/ Xxxxxx Xxxxx
______________________________
Xxxxxx Xxxxx
Dated: March 1, 2000
8
