Exhibit 10.16
NIHON ARIBA K.K.
STOCK PURCHASE AGREEMENT
DATED AS OF OCTOBER 19, 2000
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
TABLE OF CONTENTS
Page
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1 Issuance and Sale of Common Stock.........................................1
1.1 Closing..........................................................1
2 Representations and Warranties of the Company.............................1
2.1 Organization.....................................................1
2.2 Corporate Power..................................................2
2.3 Capitalization...................................................2
2.4 Authorization; Enforceability; Shares............................2
2.5 Consents.........................................................2
2.6 No Conflicts.....................................................3
2.7 Contracts........................................................3
2.8 Financial Statements.............................................3
2.9 Liabilities......................................................3
2.10 Litigation.......................................................3
2.11 Commercial Registration..........................................4
2.12 Compliance with Laws.............................................4
2.13 Brokers or Finders...............................................4
2.14 Affiliate Relationships..........................................4
3 Representations and Warranties of the Investors...........................4
3.1 Organization.....................................................4
3.2 Corporate Power..................................................4
3.3 Authorization....................................................4
3.4 Governmental Consents............................................4
3.5 No Conflicts.....................................................4
3.6 Litigation.......................................................5
3.7 Investment Intent................................................5
3.8 No Public Market.................................................5
3.9 Brokers or Finders...............................................5
3.10 Tax Advisors.....................................................5
3.11 Access to Management.............................................5
4 Covenants Prior to the Closing Date.......................................5
4.1 Commercially Reasonable Efforts..................................5
4.2 Indemnification of Officers and Directors........................6
5 Conditions of the Investors' Obligations at Closing.......................6
5.1 Representations and Warranties...................................6
5.2 Covenants........................................................6
5.3 Certificate......................................................6
5.4 Securities Laws..................................................6
5.5 Proceedings and Documents........................................6
5.6 Authorizations...................................................6
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
i
5.7 Board of Directors...............................................6
5.8 Transaction Agreements...........................................6
5.9 Opinion of Counsel...............................................6
5.10 No Injunctions or Regulatory Restraints..........................7
6 Conditions of the Company's Obligations at Closing........................7
6.1 Representations and Warranties...................................7
6.2 Covenants........................................................7
6.3 Certificate......................................................7
6.4 Permits..........................................................7
6.5 Proceedings and Documents........................................7
6.6 Payment of Purchase Price........................................7
6.7 Transaction Agreements...........................................7
6.8 No Injunctions or Regulatory Restraints..........................7
6.8 Board of Directors...............................................7
7 Covenants of the Parties..................................................8
7.1 Revenue Commitment...............................................8
7.2 License of Software Products....................................11
7.3 Confidentiality.................................................12
7.4 Governmental Filings............................................13
8 Term and Termination.....................................................13
8.1 Term............................................................13
8.2 Termination.....................................................13
9 Miscellaneous............................................................14
9.1 Governing Law; Dispute Resolution...............................14
9.2 Notices and Other Communications................................14
9.3 Language........................................................16
9.4 Severability....................................................16
9.5 References; Subject Headings....................................16
9.6 Further Assurances..............................................16
9.7 Expenses........................................................16
9.8 No Waiver.......................................................16
9.9 Entire Agreement; Amendments....................................16
9.10 Assignment......................................................17
9.11 No Agency.......................................................17
9.12 No Beneficiaries................................................17
9.13 Counterparts....................................................17
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
ii
LIST OF EXHIBITS AND SCHEDULE
EXHIBITS
EXHIBIT 2.1 Articles of Incorporation
EXHIBIT 2.11 Commercial Register
EXHIBIT 5.8(a) Shareholders Agreement
EXHIBIT 5.9 Opinion of Counsel for the Company
SCHEDULE OF EXCEPTIONS
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
iii
NIHON ARIBA K.K.
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "AGREEMENT") is made as of the
19th day of October, 2000 (the "EFFECTIVE DATE"), by and among Nihon Ariba
K.K., a Japanese corporation (the "COMPANY"), SOFTBANK Corp., a Japanese
corporation ("SOFTBANK PARENT") and SOFTBANK E-Commerce Corp., a Japanese
corporation and direct wholly owned subsidiary of SOFTBANK Parent ("SOFTBANK"
and together with SOFTBANK Parent, the "INVESTORS").
THE PARTIES HEREBY AGREE AS FOLLOWS
1. ISSUANCE AND SALE OF COMMON STOCK. Subject to the terms and
conditions hereof, the Company will issue and sell to each of the Investors
and each of the Investors will buy from the Company 1,900 shares of the
Company's common stock (the "SHARES"), for an aggregate of 3,800 Shares.
1.1 CLOSING. The closing of the purchase and sale of
the Shares hereunder (the "CLOSING") shall be held at the offices of ▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇ LLP, ▇-▇-▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇, ▇▇▇▇▇ no later
than December 31, 2000 or at such earlier time and place as shall be mutually
agreed upon by the Company and the Investors (the date and time of the
Closing is hereinafter referred to as the "CLOSING DATE"). At the Closing,
the Investors shall purchase the Shares at US$10,526.31 per Share, for an
aggregate purchase price of US$40,000,000, and the Company shall register the
Investors as the owners of the Shares on the Company's shareholder register.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants to the Investors that,
except as set forth on a schedule of exceptions (the "SCHEDULE OF
EXCEPTIONS") furnished to the Investors concurrently herewith:
2.1 ORGANIZATION. The Company was incorporated on
December 28, 1999 as a Kabushiki Kaisha (a joint-stock company). The
registered office of the Company is at Shinjuku ▇▇▇▇ ▇▇▇▇▇ ▇-▇,
▇▇▇▇▇-▇▇▇▇▇▇▇▇ ▇-▇▇▇▇▇, ▇▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇. The Company has been duly
incorporated and is a validly existing corporation under the laws of Japan
and has full power and authority to carry on its business as contemplated in
this Agreement, that certain License Agreement by and between the Company and
Ariba, Inc. ("ARIBA") (the "LICENSE AGREEMENT") and that certain Shareholders
Agreement by and among the Investors, Ariba and the Company (the
"SHAREHOLDERS AGREEMENT" together with this Agreement, the License Agreement
and any other agreement entered into which specifically states that it shall
be treated as a Transaction Agreement, "TRANSACTION AGREEMENTS"). A true and
correct copy of the Articles of Incorporation of the Company (the "ARTICLES")
is attached hereto as EXHIBIT 2.1. In the event of any discrepancy between
the provisions of this Agreement and the provisions of the Articles, the
provisions of this Agreement shall prevail.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
2.2 CORPORATE POWER. The Company has all requisite
legal and corporate power and authority (a) to execute and deliver each
Transaction Agreement to which the Company is a party, (b) to sell and issue
the Shares hereunder, and (c) to carry out and perform its obligations under
the terms of each Transaction Agreement to which it is a party.
2.3 CAPITALIZATION.
(a) As of the Closing, the Company's
authorized capital stock will consist of 20,900 shares of Common Stock, no
par value, of which 5,225 shares will be issued and outstanding. Ariba
currently owns and will own, immediately prior to the Closing, all of the
Company's issued and outstanding capital stock.
(b) The Company plans to adopt a stock plan,
under which [*] shares of Common Stock will be reserved for the grant of
options and/or stock purchase rights of employees, officers, directors and
consultants of the Company. No options, warrants, stock purchase rights,
shares or other securities have been issued under such plan.
(c) Except as contemplated by the Transaction
Agreements, there are no options, warrants or commitments of any kind
relating to the capital stock of the Company, including any preemptive or
other rights to purchase its capital stock.
2.4 AUTHORIZATION; ENFORCEABILITY; SHARES. All
corporate action on the part of the Company, its directors and shareholders
that is necessary for the authorization, execution, delivery and performance
of the Transaction Agreements by the Company, the authorization, sale,
issuance and delivery of the Shares and the performance of the Company's
obligations under each Transaction Agreement to which it is a party has been
duly and validly taken or will be duly and validly taken prior to the
Closing. This Agreement, when executed and delivered by the Investors, and
each other Transaction Agreement to which the Company is a party, when
executed and delivered at the Closing, shall constitute the legal and binding
obligation of the Company, enforceable in accordance with its terms, subject
to laws of general application relating to bankruptcy, insolvency and the
relief of debtors and other laws of general application affecting enforcement
of creditors' rights generally, rules of law governing specific performance,
injunctive relief or other equitable remedies and limitations of public
policy. The Shares, when issued in compliance with the provisions of this
Agreement, will be validly issued, fully paid and nonassessable; will have
the voting powers, preferences, rights, qualifications, limitations and
restrictions described in the Articles; and will be free of any liens,
encumbrances, restrictions, claims or charges of any kind or nature;
PROVIDED, HOWEVER, that the Shares may be subject to restrictions on transfer
under applicable securities laws and pursuant to the Transaction Agreements.
2.5 GOVERNMENTAL CONSENT, ETC. No consent, approval or
authorization of or designation, declaration or filing with any governmental
authority on the part of the Company is required in connection with the valid
execution and delivery of the Transaction Agreements, or the offer, sale or
issuance of the Shares, or the consummation of any other transaction
contemplated by the Transaction Agreements, except the qualification (or
taking of such action as may be necessary to secure an exemption from
qualification, if available) of the offer and sale
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
2
of the Shares under applicable securities laws, which filings and
qualifications, if required, will be accomplished in a timely manner within
the applicable periods therefore.
2.6 NO CONFLICTS. The Company's execution, delivery
and performance of the Transaction Agreements will not (i) violate the
Articles or any provision of applicable law, (ii) violate any applicable
rule, regulation, judgment, order, writ, injunction or decree of any
governmental body or court, (iii) have any effect on the compliance of the
Company with any applicable licenses, permits or authorizations which would
materially and adversely affect the Company, (iv) result in the breach of,
give rise to a right of termination, cancellation or acceleration of any
obligation with respect to (presently or with the passage of time), or
otherwise be in conflict with any term of, or affect the validity or
enforceability of, any contract, agreement or other commitment to which the
Company is a party and which would materially and adversely effect the
Company, or (v) result in the creation of any lien upon any assets of the
Company; provided, however, that regulatory approval may be required in
connection with conducting the Company's business and the Company makes no
representation with respect to any such approvals.
2.7 CONTRACTS. The Company has not entered into any
contracts except for contracts entered into in the ordinary course of the
Company's business and that are not material to the Company, individually or
in the aggregate. Each of the Company's material contracts is valid and in
full force and effect. The Company has duly performed its obligations under
each of its contracts. No breach of or default under any contract by the
Company has occurred, and no event has occurred which would (with the passage
of time, the giving of notice or both) cause or give rise to such a breach or
default by the Company. To the Company's knowledge, no breach of or default
under any of the Company's contracts by any Person other than the Company has
occurred, and no event which would (with the passage of time, the giving of
notice or both) cause or give rise to such a breach or default by any such
Person has occurred.
2.8 FINANCIAL STATEMENTS. The Company has delivered to
the Investors its financial statements (balance sheet and income statement),
for the fiscal period ending September 30, 2000 (the "FINANCIAL STATEMENTS").
The Financial Statements have been prepared in accordance with U.S. GAAP
applied on a consistent basis throughout the periods indicated, except that
the Financial Statements may not contain all footnotes required by U.S. GAAP.
The Financial Statements fairly present the financial condition, operating
results and cash flows of the Company as of the dates and for the periods
indicated therein, subject to normal year-end audit adjustments.
2.9 LIABILITIES. 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 September 30, 2000 and (ii) obligations under contracts and
commitments incurred in the ordinary course of business and not required
under U.S. GAAP to be reflected in the Financial Statements, which, in both
cases, individually or in the aggregate, are not material to the financial
condition or operating results of the Company.
2.10 LITIGATION. There are no actions, proceedings or
investigations before any court or governmental agency pending or, to the
Company's knowledge, threatened in writing against the Company or its
properties.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
3
2.11 COMMERCIAL REGISTRATION. A certified copy of the
commercial register of the Company (and a true and complete English
translation thereof) is attached to this Agreement as EXHIBIT 2.11, and all
information contained therein is current, complete and accurate.
2.12 COMPLIANCE WITH LAWS. The Company has complied
with, is not in violation of, and has not received any notices of violation
with respect to, any applicable law with respect to the conduct of its
business, except where such violation or lack of compliance would not have a
material effect on the Company.
2.13 BROKERS OR FINDERS. The Investors have not and
will not incur, directly or indirectly, as a result of any action taken by
the Company, Ariba or their respective Affiliates, any liability for
brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement or the transactions contemplated hereby.
2.14 AFFILIATE RELATIONSHIPS. Except as expressly
contemplated by the Transaction Agreements, SECTION 2.14 of the Schedule of
Exceptions identifies all contracts between the Company, on the one hand, and
Ariba, its Affiliates or any of their respective officers or directors, on
the other hand.
3. REPRESENTATIONS AND WARRANTIES OF THE INVESTORS.
Each of the Investors hereby represents and warrants jointly and
severally that:
3.1 ORGANIZATION. The Investor has been duly
incorporated, and is a validly existing corporation under the laws of Japan
and has full power and authority to enter into and perform each Transaction
Agreement to which it is a party.
3.2 CORPORATE POWER. The Investor has all requisite
legal and corporate power (a) to execute and deliver each Transaction
Agreement to which it is a party and (b) to carry out and perform its
obligations under the terms of each such agreement.
3.3 AUTHORIZATION. The Investor has the full power and
authority to execute, deliver and perform each Transaction Agreement to which
it is a party and purchase and pay for the Shares. This Agreement, when
executed and delivered by the Company, and each other Transaction Agreement
to which the Investor is a party, when executed and delivered on or before
the Closing, shall constitute the legal and binding obligation of the
Investor, enforceable in accordance with its terms, subject to laws of
general application relating to bankruptcy, insolvency and the relief of
debtors and other laws of general application affecting enforcement of
creditors' rights generally, rules of law governing specific performance,
injunctive relief and other equitable remedies and limitations of public
policy.
3.4 GOVERNMENTAL CONSENT, ETC. No consent, approval or
authorization of or designation, declaration or filing with any governmental
authority on the part of the Investor is required in connection with the
valid execution and delivery of the Transaction Agreements or the
consummation of any other transaction contemplated by the Transaction
Agreements.
3.5 NO CONFLICTS. The Investor's execution, delivery
and performance of this Agreement will not (i) violate the Articles of
Incorporation of the Investor or any provision of
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
4
applicable law, (ii) violate any applicable rule, regulation, judgment,
order, writ, injunction or decree of any governmental body or court, (iii)
have any effect on the compliance of the Investor with any applicable
licenses, permits or authorizations which would materially and adversely
affect the Investor, (iv) result in the breach of, give rise to a right of
termination, cancellation or acceleration of any obligation with respect to
(presently or with the passage of time), or otherwise be in conflict with any
term of, or affect the validity or enforceability of, any contract, agreement
or other commitment to which the Investor is a party and which would
materially and adversely effect the Investor, or (v) result in the creation
of any lien upon any assets of the Investor.
3.6 LITIGATION. There are no actions, proceedings or
investigations pending or, to the Investor's knowledge, threatened in writing
against the Investor or its properties before any court or governmental
agency.
3.7 INVESTMENT INTENT. The Investor is acquiring the
Shares for investment for its own account, not as a nominee or agent, and not
with a view to, or for resale in connection with, any distribution thereof.
3.8 NO PUBLIC MARKET. The Investor 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 Company's securities.
3.9 BROKERS OR FINDERS. The Company and Ariba have not
and will not incur, directly or indirectly, as a result of any action taken
by the Investor, any liability for brokerage or finders' fees or agents'
commissions or any similar charges in connection with this Agreement or the
transactions contemplated hereby.
3.10 TAX ADVISORS. The Investor has reviewed with its
own tax advisors the tax consequences of the transactions contemplated by
this Agreement. It relies solely on such advisors and not on any statements
or representations of the Company or any of the Company's agents with respect
to such tax consequences. It understands that it, and not the Company, shall
be responsible for its own tax liability that may arise as a result of the
transactions contemplated by this Agreement.
3.11 ACCESS TO MANAGEMENT. The Investor has had an
opportunity to discuss the Company's business, management and financial
affairs with the Company's management and has had access to all other
information about the Company it deemed necessary in connection with the
purchase of the Shares. The Investor has also had the opportunity to ask
questions of officers of the Company and understands that such discussions,
as well as any written information issued by the Company, were intended to
describe certain aspects of the Company's business and prospects but were not
a thorough or exhaustive description.
4. COVENANTS PRIOR TO THE CLOSING DATE.
4.1 COMMERCIALLY REASONABLE EFFORTS. The Company,
Ariba and the Investors will use commercially reasonable efforts to effect
the Closing as soon as possible but in no event later than December 31, 2000.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
5
4.2 INDEMNIFICATION OF OFFICERS AND DIRECTORS. The
Company has established or shall establish policies providing customary
indemnification protection for its directors and officers and shall provide
the Investors with a reasonable opportunity to review and comment on such
policies.
5. CONDITIONS OF THE INVESTORS' OBLIGATIONS AT CLOSING.
The Investors' obligation to effect the Closing is, unless waived by
each of the Investors in writing, subject to the fulfillment of the following
conditions:
5.1 REPRESENTATIONS AND WARRANTIES. The
representations and warranties made by the Company in SECTION 2 shall be true
and correct in all material respects as of the date hereof and as of Closing
Date.
5.2 COVENANTS. All covenants, agreements and
conditions contained in this Agreement to be performed or complied with by
the Company on or prior to the Closing Date shall have been performed or
complied with in all material respects.
5.3 CERTIFICATE. The Company shall have delivered to
the Investors a certificate in form and substance satisfactory to the
Investors, dated as of the Closing Date and signed by an executive officer of
the Company, to the effect that the conditions set forth in SECTIONS 5.1 and
5.2 have been satisfied.
5.4 SECURITIES LAWS. The Company shall have filed a
Securities Notice (YUKASHOKEN TSUCHISHO) with the Kanto Finance Bureau as
required by the Securities and Exchange Law of Japan for the offer and sale
of the Shares.
5.5 PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings of the Company in connection with the transactions contemplated
hereby and all documents and instruments incidental to such transactions
shall be reasonably satisfactory in substance and form to the Investors.
5.6 AUTHORIZATIONS. All authorizations, approvals or
permits, if any, of any governmental authority or regulatory body that are
required in connection with the lawful issuance and sale of the Shares
pursuant to this Agreement shall have been duly obtained and shall be
effective on and as of the Closing.
5.7 BOARD OF DIRECTORS. [*] shall have been elected to
the Board of Directors.
5.8 TRANSACTION AGREEMENTS. The Shareholders Agreement
in the form attached hereto as EXHIBIT 5.8(a), and each other Transaction
Agreement shall have been executed and delivered by each party thereto other
than the Investors.
5.9 OPINION OF COUNSEL. The Investors shall have
received from Asahi Law Offices, counsel for the Company, an opinion, dated
as of the Closing, in substantially the form attached hereto as EXHIBIT 5.9.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
6
5.10 NO INJUNCTIONS OR REGULATORY RESTRAINTS. No
temporary restraining order, preliminary or permanent injunction or other
order issued by any court of competent jurisdiction or governmental or
regulatory authority or other legal or regulatory restraint or prohibition
preventing the consummation of the Closing shall be in effect.
6. CONDITIONS OF THE COMPANY'S OBLIGATIONS AT CLOSING.
The Company's obligation to effect the Closing is, unless waived in
writing by the Company, subject to the fulfillment of the following
conditions:
6.1 REPRESENTATIONS AND WARRANTIES. The
representations made in SECTION 3 by each of the Investors shall be true and
correct in all material respects as of the date hereof and as of the Closing
Date.
6.2 COVENANTS. All covenants, agreements, and
conditions contained in this Agreement to be performed or complied with by
the Investor on or prior to the Closing Date shall have been performed or
complied with in all material respects.
6.3 CERTIFICATE. Each of the Investors shall have
delivered to the Company a certificate in form and substance satisfactory to
the Company, dated as of the Closing Date and signed by an executive officer
of each of the Investors, to the effect that the conditions set forth in
SECTIONS 6.1 and 6.2 have been satisfied.
6.4 PERMITS. All permits, authorizations, consents,
licenses or approvals of all relevant governmental or regulatory authorities
required for the execution and consummation by the Investors of the
transactions contemplated by the Transaction Agreements shall have been duly
obtained.
6.5 PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings of each Investor in connection with the transactions contemplated
hereby and all documents and instruments incidental to such transactions
shall be reasonably satisfactory in substance and form to the Company.
6.6 PAYMENT OF PURCHASE PRICE. The Investors shall
have delivered to the Company the purchase price for the Shares.
6.7 TRANSACTION AGREEMENTS. Each Transaction Agreement
shall have been executed and delivered by each party thereto other than the
Company and Ariba.
6.8 NO INJUNCTIONS OR REGULATORY RESTRAINTS. No
temporary restraining order, preliminary or permanent injunction or other
order issued by any court of competent jurisdiction or governmental or
regulatory authority or other legal or regulatory restraint or prohibition
preventing the consummation of the Closing shall be in effect.
6.9 BOARD OF DIRECTORS. [*] and [*] shall be available
to serve on the Board of Directors if nominated by the Company.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
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7. COVENANTS OF THE PARTIES.
7.1 REVENUE COMMITMENT.
(a) REVENUE TARGETS. The Revenue Targets for
each Revenue Period are as follows:
Revenue Period Revenue Target Revenue Date
-------------- -------------- ------------
1 [*] [*]
2 [*] [*]
3 [*] [*]
4 [*] [*]
5 [*] [*]
6 [*] [*]
7 [*] [*]
8 [*] [*]
[*]
[*]
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
8
Revenue Period Reduced Revenue Target Shifted Amount Revised Total
-------------- ---------------------- -------------- -------------
1 [*] [*] [*]
2 [*] [*] [*]
3 [*] [*] [*]
4 [*] [*] [*]
5 [*] [*] [*]
6 [*] [*] [*]
7 [*] [*] [*]
8 [*] [*] [*]
9 [*] [*] [*]
10 [*] [*] [*]
(b) NOTICE OF REVENUE. Within ten (10) days
after the end of each Revenue Period, the Company will provide each Investor
with a report, prepared in accordance with the Company's records, summarizing
in reasonable detail the Qualifying Revenues earned by the Company for such
Revenue Period, with appropriate documentation reasonably requested by the
Investors to verify the calculation of such Qualifying Revenues set out in
the report (the "QUALIFYING REVENUE REPORT").
(c) If a [*] exists for a Revenue Period,
then within ten (10) days after receiving the Qualifying Revenue Report,
SOFTBANK shall cause the Company to receive an amount of [*] equal to the [*]
(including such [*] as may be purchased by SOFTBANK or its Affiliate (as
defined in the Shareholders Agreement) as well as by any [*]) to the extent
permitted in the following sentence. [*]
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
9
(d) NOTICE OF OBJECTION. After any payment or
purchase has been made in compliance with SECTION 7.1(c) for any Revenue
Period and within sixty (60) days from the Revenue Date for such period (the
"OBJECTION NOTICE PERIOD"), either Investor may give the Company written
notice that such Investor or both Investors object to the calculation of
Qualifying Revenues set forth in such Qualifying Revenue Report (the
"OBJECTION NOTICE"). Upon receipt of any Objection Notice, the parties will
use reasonable efforts to resolve any objections. If the parties are unable
to resolve the dispute within twenty (20) days from the date of the Objection
Notice, the parties will jointly select an accounting firm of international
standing to resolve the dispute. If the parties are unable to agree on the
choice of such an accounting firm, they will select an accounting firm of
international standing by lot (other than any accounting firms for any of the
parties) (the "ACCOUNTANT") which shall determine the Qualifying Revenue for
the applicable Revenue Period. The Accountant shall deliver to each of the
parties its determination within twenty (20) days after being selected, and
the determination of the Accountant shall be binding upon the parties. The
expenses of the Accountant shall be borne equally by the parties, provided
that if the Investors' objection is resolved in the Investors' favor, the
Company shall reimburse the Investor to the extent required so that the
amount paid by the Investor pursuant to Section 7.1 less the amount of such
reimbursement is in accordance with the resolution of the dispute.
(e) The Company shall maintain complete and
accurate accounting records in accordance with sound accounting principles
and will preserve such records for a period of at least two (2) years. The
Investors may semi-annually, or at such additional time at the Investors'
request, audit, or hire an independent auditor to audit, the operations,
books and records of the Company required to be maintained pursuant to this
Section.
(f) As used herein, unless otherwise defined,
the following capitalized terms have the following respective meanings:
(i) [*] Potential customers of the
Company (A) listed on a schedule approved by the Company and the Investors on
or before the execution of this Agreement or (B) mutually agreed upon by the
Company and the Investors as follows:
Prior to commencing substantial sales efforts with respect to any potential
[*] (a "Target"), SOFTBANK shall notify the Company in writing identifying
such Target, and provide Company with any such documentation relating to such
Target as may be reasonably requested by Company. [*]
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
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(ii) [*] A localized [*]
language version of Ariba Marketplace.
(iii) [*] The aggregate Revenue
received from and only from each [*] (A) for support for the first year for
which support is rendered to such [*] (but no subsequent years) and (B) for
product licensing (but not any revenue or other credit from consulting,
maintenance, training, education or other professional services).
(iv) REVENUE: Revenue shall mean (i)
revenue that is recognized in accordance with Ariba's revenue recognition
policies as then in effect, and (ii) cash payments received by the Company
which are recognizable in accordance with U.S. GAAP and are not subject to
any contingencies. For purposes of clause (ii) above, such payments shall be
considered "Revenue" regardless of whether the Company actually recognizes
such payments as revenue so long as the payments are recognizable as defined
in clause (ii) above. Any amounts credited as "Revenue" pursuant to clause
(i) above for which cash is not collected ("Uncollectable Amount") by the end
of the quarter immediately following the Revenue Period in which such
"Revenue" is recognized (the "Next Revenue Period"), shall result in an
increase in the Revenue Target (on a dollar for dollar basis) for the Revenue
Period immediately following the Next Revenue Period equal to the
Uncollectable Amount.
(v) REVENUE DATE: The last day of
each respective Revenue Period as set forth in SECTION 7.1(a).
(vi) REVENUE PERIOD: The three month
periods set forth in SECTION 7.1(a), to which the Revenue Target apply and
any subsequent three month periods as necessary for any Shifted Amount.
(vii) REVENUE TARGET: The targeted
level of Qualifying Revenue for each Revenue Period as set forth in SECTION
7.1(a), as adjusted pursuant to SECTION 7.1(a).
(viii) [*] shall mean, for any Revenue
Period, the amount, if any, by which the Qualifying Revenue is [*] than the
Revenue Target, provided that such [*] shall be [*] on a dollar-for-dollar
basis by an amount equal to the amount, if any, by which the aggregate amount
of Qualifying Revenue for all prior Revenue Periods, including the aggregate
amount of Qualifying Revenues that the Company receives for prior Revenue
Periods pursuant to Section 7.1(c), exceeds the sum of the Revenue Targets
for all prior Revenue Periods.
(ix) U.S. GAAP: Generally accepted
accounting principles of the United States of America.
7.2 LICENSE OF SOFTWARE PRODUCTS. The Company and [*]
shall negotiate in good faith toward [*] license of Software Products (as
defined in the License Agreement) on terms and conditions acceptable to the
parties, resulting in Qualifying Revenues no less than [*]. The terms of the
license shall require payment in full by [*], with the specific payment
schedule to be set forth in the agreement.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
11
The parties shall use all diligent efforts to execute and deliver an
agreement by [*].
7.3 CONFIDENTIALITY.
(a) The Investors recognize that, in
connection with the performance of this Agreement, the Company may disclose
Confidential Information (as defined below) to the Investors. For purposes of
this Agreement, "CONFIDENTIAL INFORMATION" means (i) proprietary information
(whether owned by the Company or a third party to whom the Company owes a
non-disclosure obligation) regarding the Company's business or (ii)
information which is marked as confidential at the time of disclosure to the
Investors, or if in oral form, is identified as confidential at the time of
oral disclosure. Confidential Information shall not include information
which: (A) was known to the Investors at the time of the disclosure by the
Company; (B) has become publicly known through no wrongful act of the
Investors; (C) has rightfully been received by the Investors from a third
party without an obligation of confidentiality; or (D) has been independently
developed by the Investors. Each of the Investors agrees (x) not to use any
such Confidential Information for any purpose other than in the performance
of its obligations under this Agreement and (y) not to disclose any such
Confidential Information, except (1) to its employees who are reasonably
required to have the Confidential Information in connection herewith or with
any of the other Transaction Agreements, (2) to its agents, representatives,
lawyers and other advisers that have a need to know such Confidential
Information or (3) pursuant to, and to the extent of, a request or order by a
court or other governmental authority; PROVIDED that such parties undertake
in writing (or are otherwise bound by rules of professional conduct) to keep
such information strictly confidential. Each of the Investors agrees to take
all reasonable measures to protect the secrecy and confidentiality of, and
avoid disclosure or unauthorized use of, the Company's Confidential
Information.
(b) Each of the Investors acknowledges and
agrees that (i) its obligations under this SECTION 7.3 are necessary and
reasonable to protect the Company and its business, (ii) any violation of
these provisions could cause irreparable injury to the Company for which
money damages would be inadequate, and (iii) as a result, the Company shall
be entitled to obtain injunctive relief against the threatened breach of the
provisions of this SECTION 7.3 without the necessity of proving actual
damages. Each of the Investors agrees that the remedies set forth in this
SECTION 7.3 are in addition to and in no way preclude any other remedies or
actions that may be available to the Company at law or under this Agreement.
(c) Each of the Investors agrees that the
terms and conditions of this Agreement and the Transaction Agreements shall
be treated as Confidential Information and that no reference thereto shall be
made without the prior written consent of the Company (which consent shall
not be unreasonably withheld) except (a) as required by applicable law
including, without limitation, by the U.S. Securities and Exchange Commission
and Japanese governmental authorities and relevant stock exchanges or
markets, (b) to its accountants, banks, financing sources, lawyers and other
professional advisors, PROVIDED that such parties undertake in writing (or
are otherwise bound by rules of professional conduct) to keep such
information strictly confidential, (c) in connection with the enforcement of
this Agreement, (d) in connection with a merger, acquisition or similar
transaction or (e) pursuant to joint press releases mutually agreed to by the
parties to be prepared in good faith.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
12
7.4 GOVERNMENTAL FILINGS.
If any Japanese withholding taxes are imposed on dividends
payable to the Investors by the Company, the Company shall withhold such
amounts, pay the same to the Japanese tax authority, and promptly furnish the
Investors with appropriate documentation of the amounts so withheld as soon
as practicable. The Company shall cooperate with the Investors to make and
necessary filings to utilize the lowest withholding rate available under any
treaty between Japan and the United States.
8. TERM AND TERMINATION.
8.1 TERM. This Agreement shall be effective as of the
Effective Date and shall continue in effect until and unless terminated
pursuant to SECTION 8.2.
8.2 TERMINATION. This Agreement may be terminated as
follows:
(a) Upon the parties' mutual written
agreement.
(b) If any of the Company, Ariba or either
Investor fails to perform, in any material respect, any of its material
obligations hereunder or under any of the other Transaction Agreements, and
if such default continues for a period of thirty (30) days after the date the
defaulting party first receives written notice of such default from either
Investor (if Ariba or the Company is the defaulting party) or Ariba or the
Company (if either of the Investors is the defaulting party), then either
Investor (if Ariba or the Company is the defaulting party) or the Company (if
either of the Investors is the defaulting party) shall have the right to
terminate this Agreement effective immediately upon written notice to the
defaulting party at any time after such thirty (30)-day period.
(c) The Investors shall have the right to
terminate this Agreement, effective immediately upon written notice to Ariba
and the Company, in the event that either Ariba or the Company has elected to
terminate [*] in accordance with its terms.
(d) Notwithstanding the foregoing, the right
of the Investors to terminate this Agreement pursuant to Section 8.2(b), as a
result of a default of the Company, or pursuant to Section 8.2(c), as a
result of a termination of [*] by the Company, shall exist only if [*] and
only if no [*] (as defined in the Shareholders Agreement) is in effect.
(e) Any of the Company, SOFTBANK or SOFTBANK
Parent shall have the right to terminate this Agreement, effective
immediately upon written notice to the other party, if the Closing has not
occurred on or before December 31, 2000.
(f) Any of the Company or the Investors shall
have the right to terminate this Agreement, effective immediately upon
written notice to the other party, in the event that the Company (where an
Investor is the party giving notice) or an Investor (where the Company is the
party giving notice) is dissolved, liquidated or declared bankrupt or a
filing for
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
13
voluntary or involuntary bankruptcy, civil rehabilitation or for the
application of other similar insolvency or rehabilitation procedures is made
by such party.
(g) Notwithstanding the foregoing, SECTION
7.3 and ARTICLE 9 (except for SECTION 9.6, which shall not survive
termination) shall survive a termination of the Agreement. Termination of
this Agreement for any reason shall not release any party from any liability
or obligation which has already accrued as of the effective date of such
termination, and shall not constitute a waiver or release of, or otherwise be
deemed to prejudice or adversely affect, any rights, remedies or claims,
whether for damages or otherwise, which a party may have hereunder, at law,
equity or otherwise or which may arise out of or in connection with such
termination.
9. MISCELLANEOUS.
9.1 GOVERNING LAW; DISPUTE RESOLUTION. The validity,
construction and enforceability of this Agreement shall be governed by and
construed in accordance with the laws of the state of California. All
disputes between the parties arising out of or relating to this Agreement
shall be settled by the parties amicably through good faith discussions upon
the written request of any party. In the event that any such dispute cannot
be resolved thereby within a period of sixty (60) days after such notice has
been given, such dispute shall be finally settled by arbitration in San
Francisco, California, using the English language in accordance with the
Rules of Arbitration of the American Arbitration Association then in effect,
by one or more arbitrators appointed by the chief judge of the superior court
of San Francisco. The arbitrator(s) shall have the authority to grant
specific performance and to allocate between the parties the costs of
arbitration in such equitable manner as the arbitrator(s) may determine. The
prevailing party in the arbitration shall be entitled to receive
reimbursement of its reasonable expenses incurred in connection therewith.
Judgment upon the award so rendered may be entered in any court having
jurisdiction or application may be made to such court for judicial acceptance
of any award and an order of enforcement, as the case may be. Notwithstanding
the foregoing, each party shall have the right to institute a legal action in
a court of proper jurisdiction for injunctive relief and/or a decree for
specific performance pending final settlement by arbitration.
9.2 NOTICES AND OTHER COMMUNICATIONS. Unless otherwise
provided, any notice required or permitted under this Agreement shall be
given in writing and in English and shall be deemed effectively given (i)
upon personal delivery to the party to be notified, (ii) by delivery by
confirmed facsimile or (iii) three (3) business days after being provided to
an internationally recognized courier service with an expected delivery of no
more than three (3) business days, in each case to the party to be notified
at the address indicated for such party on the signature page hereof, or at
such other address as such party may designate by ten (10) days' advance
written notice to the other parties:
(a) If to SOFTBANK Parent
[*]
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
14
[*]
with a copy to:
[*]
(b) If to SOFTBANK
[*]
with a copy to:
[*]
(c) If to the Company
[*]
with a copy to:
[*]
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
15
[*]
9.3 LANGUAGE. This Agreement is in the English
language only, which language shall be controlling in all respects, and all
versions hereof in any other language shall be for accommodation only and
shall not be binding upon the parties. All communications and notices to be
made or given pursuant to this Agreement shall be in the English language.
9.4 SEVERABILITY. If any provision in this Agreement
shall be found or be held to be invalid or unenforceable (including, without
limitation, as a result of objections by the Japanese Fair Trade Commission)
then the meaning of said provision shall be construed, to the extent
feasible, so as to render the provision enforceable, and if no feasible
interpretation would save such provision, it shall be severed from the
remainder of this Agreement which shall remain in full force and effect
unless the severed provision is essential and material to the rights or
benefits received by any party. In such event, the parties shall use best
efforts to negotiate, in good faith, a substitute, valid and enforceable
provision or agreement which most nearly affects the parties' intent in
entering into this Agreement.
9.5 REFERENCES; SUBJECT HEADINGS. Unless otherwise
indicated, references to Sections and Exhibits herein are to Sections of and
Exhibits to, this Agreement. The subject headings of the Sections of this
Agreement are included for the purpose of convenience of reference only, and
shall not affect the construction or interpretation of any of its provisions.
9.6 FURTHER ASSURANCES. The parties shall each perform
such acts, execute and deliver such instruments and documents, and do all
such other things as may be reasonably necessary to accomplish the
transactions contemplated in this Agreement.
9.7 EXPENSES. Each of the parties will bear its own
costs and expenses, including, without limitation, fees and expenses of legal
counsel, accountants, brokers, consultants and other representatives used or
hired in connection with the negotiation and preparation of this Agreement
and consummation of the transactions contemplated hereby. All such expenses
incurred by the Company shall be borne by the Company to the maximum extent
permitted by applicable law including, without limitation, expenses relating
to the formation of the Company, any transfer taxes for transfer of the
Company stock to the parties, registration charges, taxes, fees and expenses
relating to required governmental or regulatory approvals, notary fees and
legal fees and expenses.
9.8 NO WAIVER. No waiver of any term or condition of
this Agreement shall be valid or binding on a party unless the same shall
have been set forth in a written document, specifically referring to this
Agreement and duly signed by the waiving party. The failure of a party to
enforce at any time any of the provisions of this Agreement, or the failure
to require at any time performance by one or both of the other parties of any
of the provisions of this Agreement, shall in no way be construed to be a
present or future waiver of such provisions, nor in any way affect the
ability of a party to enforce each and every such provision thereafter.
9.9 ENTIRE AGREEMENT; AMENDMENTS. The terms and
conditions contained in this Agreement (including the Schedules and Exhibits
hereto), the other Transaction Agreements and the Ariba Non-Disclosure
Agreement dated October 19, 2000 by and between Ariba and the
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
16
Investors constitute the entire agreement between the parties and supersede
all previous agreements and understandings, whether oral or written, between
the parties with respect to the subject matter hereof. No agreement or
understanding amending this Agreement shall be binding upon any party unless
set forth in a written document which expressly refers to this Agreement and
which is signed and delivered by duly authorized representatives of each
party.
9.10 ASSIGNMENT. No party shall assign this Agreement
or any rights or obligations hereunder without the other parties' prior
written consent, except that (i) the Company may assign this Agreement to a
Person into which it has merged or which has otherwise succeeded to all or
substantially all of the Company's business or assets and (ii) the Investors
may assign this Agreement to a Person that is a wholly owned subsidiary of
SOFTBANK Parent or a Person who has succeeded to all or substantially all of
SOFTBANK Parent's business or assets. All assignees under this SECTION 9.10
must assume in writing or by operation of law, the assigning party's
obligations under this Agreement, PROVIDED, HOWEVER, that the assigning party
shall remain liable for the assignee's performance of its obligations
hereunder. This Agreement shall inure to the benefit of, and shall be binding
upon, the parties and their respective permitted successors and assigns.
9.11 NO AGENCY. The parties are independent
contractors. Nothing contained herein or done in pursuance of this Agreement
shall constitute any party the agent of any other party for any purpose or in
any sense whatsoever.
9.12 NO BENEFICIARIES. Nothing herein express or
implied, is intended to or shall be construed to confer upon or give to any
person, firm, corporation or legal entity, other than the parties and their
affiliates who hold securities (and, in the case of the Investors, any
affiliates of SOFTBANK Parent), any interests, rights, remedies or other
benefits with respect to or in connection with any agreement or provision
contained herein or contemplated hereby.
9.13 COUNTERPARTS. This Agreement may be executed in
any number of counterparts, and each counterpart shall constitute an original
instrument, but all such separate counterparts shall constitute only one and
the same instrument.
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
17
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
COMPANY:
NIHON ARIBA K.K.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Title: Chairman & CEO
---------------------------------------
INVESTORS:
SOFTBANK E-COMMERCE CORP.
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------------
Title:
---------------------------------------
SOFTBANK CORP.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇
------------------------------------------
Title:
---------------------------------------
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
EXHIBIT 2.1
Articles of Incorporation
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
EXHIBIT 2.11
Commercial Register
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
EXHIBIT 5.8(a)
Shareholders Agreement
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
EXHIBIT 5.9
Opinion of Counsel for the Company
* Represents confidential information for which Ariba, Inc. is seeking
confidential treatment with the Securities and Exchange Commission.
