Exhibit 4.24
September 1, 2002
▇▇▇▇ ▇▇▇▇▇▇
President
AxcessNet Ltd.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re:Consulting Agreement
Dear Eyal,
This letter sets for the terms and conditions upon which ▇▇▇▇ ▇▇▇▇▇▇ (the
"Consultant") will provide certain Consulting services to Commtouch Software Ltd
(the "Company"). Specifically, the Consultant and the Company have agreed as
follows:
1. Consulting Services: The Company hereby retains the Consultant to
provide the Consulting Services (as hereinafter defined) to the
Company, and the Consultant thereby agrees to provide Consulting
Services to the Company, on the terms and conditions set forth herein,
for a period of one year commencing on September 1, ▇▇▇▇ ("▇▇▇ ▇▇▇▇").
The term "Consulting Services" means advice and consultation pertaining
to the Company's strategic directions, as may be reasonably requested,
from time to time by the Executive Management or the Board of Directors
of the Company. Such Consulting Services may be also rendered by
telephone or in any other form as may be mutually agreed upon by the
parties hereto and need not be always rendered in person, and the
Consultant's obligation to provide services hereunder shall not prevent
the Consultant from engaging in any other services or activities,
including without limitation other consulting services. The Consultant
also agrees to serve on the Company's Board of Advisors during the Term
of this letter agreement if so nominated and elected by the Company.
The relationship between the Consultant and the Company shall be that
of independent contractors and nothing in this letter agreement shall
be construed to constitute neither the Consultant nor the Company as a
partner, employee or agent of the other. Neither the Consultant nor the
Company shall have the authority to bind the other in any manner
without the prior written consent of the other.
2. Compensation:For the initial consulting period, which commenced on
September 1, 2002 and continues until December 31, 2002, Consultant
will receive from Company cash payments of $20,000 per month that will
be due him on the first day of each month. For the period commencing on
January 1, 2003 and continued until April 30, 2003, Consultant will
receive warrants to purchase 206,897 Ordinary Shares of the Company
valid for a period of 5 years and with an exercise price of $0.01 per
share. . For the extended period commencing on May 1, 2003 and
continued until August 31, 2003, Consultant will receive from Company
cash payments of $15,000 per month that will be due him on the first of
each month, commencing May 1st, 2003, for a total cash payment of
$60,000. Commtouch's CEO will be allowed to terminate Consultant's
consulting services during the Term, but such termination will become
effective on August 31, 2003. In addition to the piggy-back
registration rights included in the attached Warrant, the applicable
Warrant holder hereunder and under the "Advisory Agreement" between the
parties of September 1, 2002 will be entitled to one registration of
applicable Warrant shares by way of a written demand on Commtouch. In
this regard, the Warrant holder shall be entitled at any time following
its exercise of a Warrant or Warrants and prior to the termination of
such Warrant(s) to demand that Commtouch cause all Warrant shares then
exercised to be registered according to a registration statement under
the 1933 Act. If the demand is for filing a registration statement with
the SEC within six (6) months of the date of the demand, the Warrant
holder shall be responsible for paying all Registration Expenses
associated therewith, as defined in Section 7(c) of the attached
Warrant. If the demand allows Commtouch twelve (12) months within which
to file a registration statement, Commtouch shall be responsible for
paying all such Registration Expenses.
In addition, Company will reimburse Consultant for all reasonable
expenses approved in advance in writing by Company and paid or incurred
by Consultant in connection with, or related to, the rendering of
Consulting Services upon presentation by Consultant of such
documentation, expense statements, vouchers and other supporting
information as may be reasonably requested by Company. In the event
Consultant serves on Company's Board of Advisors described in Section
1, Consultant shall, in addition, be entitled to receive all rights and
benefits, without limitation including indemnification rights (subject
to applicable law), granted to the other Advisors.
3. General: This letter agreement constitutes the entire agreement between
the Company and the Consultant with respect to the Consulting Services
and supersedes all prior agreements and understandings, written or
oral, relating to such Consulting Services. This letter agreement is in
addition to the advisory agreement between AxcessNet Ltd and Company
with respect to potential investments and other transactions with
Qualified Entities. This letter agreement may be amended, modified,
changed or discharged, in whole or in part, only in a written
instrument executed by the Company and the Consultant. This Agreement
shall be binding upon and inure to the benefit of the parties and their
successors, assigns, executors, estate and heirs, provided that this
Agreement may be assigned by the Consultant only to entities that are
under Consultant's control. This Agreement shall be governed by and
construed, interpreted and enforced as a sealed instrument under and in
accordance with the laws of the State of California, without regard to
conflicts of laws principles. It is Commtouch's understanding that the
Consultant will be performing all its work hereunder in the United
States.
If the foregoing accurately reflects the mutual agreement between you and the
Company, please sign in the space below.
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------
Commtouch Software Ltd.
▇▇▇▇▇▇ ▇▇▇▇▇▇, CEO
September 1, 2002
We hereby accept the terms of this agreement and confirm the receipt of a
warrant to acquire 206,897 Ordinary Shares of the Company
Consultant:
/s/▇▇▇▇ ▇▇▇▇▇▇
--------------
AxcessNet Ltd.
▇▇▇▇ ▇▇▇▇▇▇
President
Issued _________, 200_
THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY SET FORTH HEREIN. THIS WARRANT AND THE
SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE. NO SALE
OR DISPOSITION MAY BE EFFECTED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER, SATISFACTORY
TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR SUCH
STATE LAWS.
THIS WARRANT MAY NOT BE EXERCISED EXCEPT IN COMPLIANCE WITH ALL APPLICABLE
FEDERAL AND STATE SECURITIES LAWS TO THE REASONABLE SATISFACTION OF THE COMPANY
AND LEGAL COUNSEL FOR THE COMPANY.
Void after ________, 200_
COMMTOUCH SOFTWARE LTD.
WARRANT TO PURCHASE UP TO __________ ORDINARY SHARES
THIS CERTIFIES THAT, for value received, ___________ ("_________" or "Holder"),
is entitled at any time prior to expiration of this Warrant to subscribe for and
purchase up to ________ shares of the fully paid and nonassessable ordinary
shares, nominal value NIS 0.05, of Commtouch Software Ltd., an Israeli company
(the "Company"), at the price per share equal to $0.01 (such price and such
other price as may result, from time to time, from the adjustments/restrictions
specified in paragraph 4 hereof are collectively referred to herein as the
"Warrant Price"), subject to the provisions and upon the terms and conditions
hereinafter set forth. As used herein, "Shares" shall mean the ordinary shares
of the Company; "Warrant Shares" shall mean the Shares issued or issuable upon
exercise of the Warrants; and "Date of Grant" shall mean __________, 200_.
1. TERM.
This Warrant is exercisable, in whole or in part, at any time and from time to
time on and after the Date of Grant for a period of five years, i.e. through
_____________, 200_.
2. METHOD OF EXERCISE; PAYMENT; ISSUANCE OF NEW WARRANT.
(a) The purchase right represented by this Warrant may be exercised by the
holder hereof, in whole or in part, by the surrender of this Warrant (with the
notice of exercise form attached hereto as Exhibit A duly executed) at the
principal office of the Company and (i) by the payment to the Company, by check,
of an amount equal to the Warrant Price per Share multiplied by the number of
Shares then being purchased.
(b) In the event of any exercise of the purchase right represented by this
Warrant, certificates for the Shares so purchased shall be delivered to the
holder hereof within ten business days of the effective date of such purchase
and, unless this Warrant has been fully exercised or expired, a new Warrant
representing the portion of the securities, if any, with respect to which this
Warrant shall not then have been exercised shall also be issued to the holder
hereof within such ten-day period. Upon the effective date of such purchase, the
holder shall be deemed to be the holder of record of the securities,
notwithstanding that certificates representing the securities shall not then be
actually delivered to such holder or that such securities are not then set forth
on the stock transfer books of the Company.
(c) The holder of this Warrant agrees to use commercially reasonable best
efforts to exercise this Warrant in such manner as to avoid becoming, as a
result of such exercise, a 10% or greater shareholder of the Company and shall
reasonably cooperate with the Company so as to minimize adverse Israeli tax
consequences.
(d) In lieu of exercising this Warrant by payment of cash or check, and provided
that the Company's Ordinary Shares are publicly traded, the Holder may elect to
receive shares equal to the value of this Warrant (or the portion thereof being
exercised) at any time after the date hereof during the term hereof, by
surrender of this Warrant at the principal executive office of the Company,
together with the Notice of Conversion in the form of Exhibit B annexed hereto,
in which event the Company shall issue to Holder a number of Shares in
accordance with the following formula:
Y(A-B)
------
X = A
Where, X = the number of Shares to be issued to Holder;
Y = the number of Shares for which the Warrant is
being exercised;
A = the fair market value of one Share; and
B = the Exercise Price.
For purposes of this Section 2(d), the fair market value of the Shares
shall mean the price determined by the Company's Board of Directors, acting in
good faith upon a review of all relevant factors or, in the event of an exercise
concurrently with (i) a public offering of the Company's stock, the price to the
public for such stock in such offering or (ii) an acquisition, the per share
price to be received by the holders of Shares.
3. SHARES FULLY PAID; RESERVATION OF SHARES.
(a) All securities which may be issued upon the exercise of the rights
represented by this Warrant will, upon issuance, be fully paid and
nonassessable, and free from all taxes, liens and charges with respect to
the issue thereof. During the period within which the rights represented by
this Warrant may be exercised, the Company will at all times have
authorized, and reserved for the purpose of the issue upon exercise of the
purchase rights evidenced by this Warrant, a sufficient number of Shares to
provide for the exercise of the rights represented by this Warrant.
(b) The Company will not, by amendment of its certificate of incorporation
or bylaws, or through reorganization, consolidation, merger, dissolution,
issue or sale of securities, sale of assets or any other voluntary action,
willfully avoid or seek to avoid the observance or performance of any of
the terms hereof, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such actions as may
be necessary or appropriate in order to protect the rights of Warrant
Holder
under the Warrants against such willful actions. Without limiting the
generality of the foregoing, the Company: (i) will not set nor increase the
par or nominal value of any Warrant Shares above the amount payable
therefor upon such exercise, and (ii) will take all actions that are
necessary or appropriate in order that the Company may validly and legally
issue fully paid and nonassessable Warrant Shares upon the exercise of the
Warrants.
4. ADJUSTMENTS.
The maximum number of Warrant Shares issuable upon exercise of this Warrant and
the Warrant Price shall be adjusted if any of the following events occur before
the holder's exercise of this Warrant:
(a) Distributions, Share Dividends and Splits.
(i) In case the Company declares a dividend or other
distribution payable in Shares or subdivides its Shares into a greater
number of Shares, the Warrant Price in effect immediately prior to such
declaration or subdivision shall be proportionately decreased and the
number and kind of Shares purchasable upon exercise of this Warrant
shall be adjusted so that the holder thereof shall be entitled to
receive the kind and number of shares or the other securities of the
Company that the holder would have owned or have been entitled to
receive after the happening of any of the events described in this
paragraph (a)(i) had the Warrant Shares been issued immediately prior
to the happening of such event or any record date with respect thereto.
(ii) In the case of any reclassification or change of the
outstanding securities of the Company or of any reorganization of the
Company after the date hereof, or in case, after such date, the Company
shall consolidate with or merge with or into another corporation or
convey all or substantially all of its assets to another corporation or
other entity, then, in each such case, Warrant Holder, upon any
exercise of this Warrant, at any time after the consummation of such
reclassification, change, reorganization, consolidation, merger, or
conveyance, shall be entitled to receive, in lieu of the stock or other
securities and property receivable upon the exercise of this Warrant
prior to such consummation, the stock or other securities or property
to which such Warrant Holder would have been entitled upon the
consummation of such reclassification, change, reorganization,
consolidation, merger or conveyance if Warrant Holder had exercised the
Warrants immediately prior thereto, all subject to further adjustment
as provided in this Section, and the successor or purchasing
corporation or other entity in such reclassification, change,
reorganization, consolidation, merger or conveyance (if not the
Company) shall duly execute and deliver to Warrant Holder a supplement
hereto acknowledging such corporation's or entity's obligations under
the Warrants; and in each such case, the terms of the Warrants
(including the exercisability, transfer and adjustment provisions of
the Warrants) shall be applicable to the shares of stock or other
securities or property receivable upon the exercise of the Warrants
after the consummation of such reclassification, change,
reorganization, consolidation, merger or conveyance.
(iii) An adjustment made pursuant to this paragraph (a) shall
become effective immediately after the record date in the case of a
dividend or distribution and shall become immediately effective after
the effective date in the case of a subdivision. If, as a result of an
adjustment made pursuant to this paragraph (a), the holder after
exercise shall become entitled to receive shares of two or more classes
of capital stock or Shares and any other class of capital stock of the
Company, the Board of Directors of the Company (whose determination
shall be conclusive and shall be described in a written notice to the
holder promptly after such adjustment) shall determine the allocation
of the adjusted Warrant Price between or among shares of such classes
of capital stock or Shares and such other classes of capital stock.
(iv) In the case of any adjustment in the number of Warrant
Shares receivable upon the exercise of the Warrants pursuant to the
terms hereof, the chief financial officer of the Company
shall promptly thereafter compute such adjustment in accordance with
the terms hereof and prepare a certificate setting forth such
adjustment and showing in detail the facts upon which such adjustment
is based. The Company will provide copies of such certificate to
Warrant Holder in the manner provided for notices hereunder.
(b) Record Date. In case the Company shall take a record of the holders of its
Shares for the purpose of determining holders entitled to receive a dividend or
other distribution payable in Shares, then such record date shall be considered
to be the date of the issue or sale of the Shares related to such dividend or
distribution.
(c) Stock Combinations. In case the Company shall combine all of the outstanding
Shares into a smaller number of Shares, the Warrant Price in effect immediately
prior to such combination shall be proportionately increased and the number of
Warrant Shares shall be proportionately decreased.
(d) Fractional Shares. No fractional Warrant Shares shall be issued upon the
exercise hereof. Upon exercise by any holder, such holder shall be entitled to
receive the aggregate full number of Shares which the holder may receive upon
exercise.
(e) The adjustment to the number of Shares issuable upon the exercise hereof and
the adjustments to the Warrant Price described in this Section 4 shall be made
each time any event listed in this Section 4 occurs.
(f) If any event occurs of the type contemplated by the provisions of this
Section 4, but not expressly provided for by such provisions or definition, then
the Company's Board of Directors in its reasonable judgment shall make an
appropriate adjustment in the number of Warrant Shares obtainable upon exercise
of this Warrant so as to protect the rights of the Warrant Holder.
5. COMPLIANCE WITH SECURITIES ACT; RESTRICTIONS ON TRANSFER; REPRESENTATIONS.
Holder hereby represents and warrants that:
(a) Purchase Entirely for Own Account. This Warrant and the Warrant
Shares issuable upon exercise hereof (collectively, the "Securities") will be
acquired for investment for Holder's own account, not as a nominee or agent, and
not with a view to the resale or distribution of any part thereof, and Holder
has no present intention of selling, granting any participation in or otherwise
distributing the same. Holder does not have any contract, undertaking, agreement
or arrangement with any person to sell, transfer or grant participation to any
person with respect to any of the Securities. Holder represents that it has full
power and authority to enter into this Warrant.
(b) Investment Experience. Holder acknowledges that it is able to fend
for itself, can bear the economic risk of its investment and has such knowledge
and experience in financial or business matters that it is capable of evaluating
the merits and risks of the investment in this Warrant. Holder also represents
it has not been organized for the purpose of acquiring this Warrant.
(c) Accredited Investor. Holder is an "accredited investor" within the
meaning of Rule 501 of Regulation D of the Securities and Exchange Commission
(the "SEC"), as presently in effect.
(d) Restricted Securities. Holder understands that the Securities are
characterized as "restricted securities" under the federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering, and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act of
1933, as amended
("the Securities Act") only in certain limited circumstances. In this
connection, Holder represents that it is familiar with SEC Rule 144 promulgated
under the Securities Act, as presently in effect, and understands the resale
limitations imposed thereby and by the Act.
(e) Further Limitations on Disposition. Without in any way limiting the
representations set forth above, Holder further agrees not to make any
disposition of all or any portion of the Securities unless and until there is
then in effect a registration statement under the Securities Act covering such
proposed disposition and such disposition is made in accordance with such
registration statement, or (i) Holder shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (ii)
Holder shall have furnished the Company with an opinion of counsel, reasonably
satisfactory to the Company, that such disposition will not require registration
of such shares under the Securities Act.
(f) Authorization. The holder hereby represents that its acceptance of
this Warrant has been authorized on its behalf by all appropriate limited
liability company, corporate or partnership action.
(g) Enforceability. The holder hereby represents that it has full legal
power to accept this Warrant and that its acceptance of this Warrant will result
in legally binding obligations of the holder enforceable against it in
accordance with the terms and provisions hereof except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors' rights generally,
and(ii) as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
(h) Legend. This Warrant and all Shares issued upon exercise of this
Warrant(unless registered under the Securities Act) shall be stamped or
imprinted with a legend in substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT THE PRIOR WRITTEN
CONSENT OF THE COMPANY AND WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED
THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER, SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT."
The Company need not register a transfer of this Warrant or the Warrant Shares
unless the conditions specified in such legend are satisfied. Subject to the
foregoing transfer restrictions set forth in this Section, this Warrant is
transferable, in whole or in part, on the books of the Company, upon surrender
of this Warrant to the Company, together with a written assignment duly executed
by the Holder.
(i) Notwithstanding the foregoing, the restrictions imposed upon the
transferability of this Warrant and the Warrant Shares shall cease and
terminate as to this Warrant or any particular shares of capital stock
when, (i) such Warrant or Warrant Shares shall have been effectively
registered under the 1933 Act and sold by the holder thereof in accordance
with such registration or (ii) counsel for Holder provides an opinion, in
form and substance reasonably satisfactory to the Company (or in lieu of an
opinion of counsel, Holder provides the Company with other evidence
satisfactory to the Company), that such restrictions are no longer required
in order to ensure compliance with the 1933 Act. If and whenever the
restrictions imposed hereunder shall terminate as to this Warrant (or to
any Warrant Shares) as hereinabove provided, Holder may and the Company
shall, as promptly as practicable upon the request of Holder and at the
Company's expense, cause to be stamped or otherwise imprinted upon this
Warrant or such shares of capital stock a legend in substantially the
following form:
"The restrictions on the transferability of [this] [these]
[Warrant] [securities] terminated on _______________, _____,
and are of no further force or effect"
or take such other action as to effectively remove the restrictions on the
transferability of the Warrant and the Warrant Shares.
Any Warrant issued upon the split-up, combination, exchange,
substitution, transfer or loan of the Warrants entitled to bear such legend
shall have a similar legend endorsed thereon. Whenever the restrictions imposed
hereunder shall terminate as to any Warrant or as to any shares of capital
stock, as hereinabove provided, the Holder thereof shall be entitled to receive
from the Company without expense, a new Warrant or new shares of capital stock
not bearing the restrictive legend set forth hereon or above, respectively.
(j) The Company shall cause all Warrant Shares covered by a valid
registration statement to be listed on any securities exchange upon which the
Shares are then listed.
6. RIGHTS OF SHAREHOLDERS.
(a) No holder of the Warrant or Warrants shall be entitled to vote or receive
dividends or be deemed the holder of Shares, nor shall anything contained herein
be construed to confer upon the holder of this Warrant, as such, any of the
rights of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of stock, reclassification of stock, change of par
value or change of stock to no par value, consolidation, merger, conveyance, or
otherwise) or to receive notice of meetings, or to receive dividends until the
Warrant or Warrants shall have been exercised and the Shares shall have become
deliverable, as provided herein.
(b) As of the date hereof and at all times from and after the date hereof, the
shares of Common Stock deliverable on the exercise of this Warrant would not and
will not constitute ten percent (10%) or more (in terms of either value or
voting rights) of the outstanding shares of capital stock of the Company. The
Company shall notify Warrant Holder of any redemptions or other actions taken by
the Company or any other person which may cause the percentage of the Company's
capital stock subject to this Warrant to increase.
(c) In the event Warrant Holder at any time is entitled to acquire under this
Warrant shares of capital stock representing 9.9% or more of the outstanding
capital stock of the Company, then Company shall be deemed by such date to have
terminated and redeemed this Warrant and shall be obligated to pay to Warrant
Holder the difference between fair market value of the underlying shares and the
exercise price, per share, subject to any restrictions imposed by Israeli law
and provided that the fair market value is greater than the exercise price.
7. PIGGY-BACK AND DEMAND REGISTRATION RIGHTS
(a) The Company shall notify Warrant Holder in writing at least fifteen (15)
days prior to filing any registration statement under the 1933 Act for purposes
of effecting a public offering of securities of the Company (including, but not
limited to, registration statements relating to secondary offerings of
securities of the Company, but excluding registration statements relating to any
employee benefit plan or a corporate reorganization) and will afford Warrant
Holder an opportunity to include in such registration statement all or any part
of the Warrant Shares issued or reserved for issuance to Warrant Holder upon
exercise of this Warrant. If Warrant Holder desires to include in any such
registration statement all or any part of such Warrant Shares, Warrant Holder
shall, within ten (10) days after receipt of the above-described notice from the
Company, so notify the Company in writing, and in such notice shall inform the
Company of the number of Warrant Shares Warrant Holder wishes to include in such
registration statement. If Warrant
Holder decides not to include all of the shares of Common Stock issued or
reserved for issuance to Warrant Holder upon the exercise of this Warrant in any
registration statement thereafter filed by the Company, Warrant Holder shall
nevertheless continue to have the right to include any such Warrant Shares any
subsequent registration statement or registration statements as may be filed by
the Company with respect to offerings of its securities, all upon the terms and
conditions set forth herein. The Company will cooperate with Warrant Holder to
facilitate its distribution of Warrant Shares pursuant to any such registration
statement.
(b) The Company agrees to indemnify and hold harmless Warrant Holder and its
directors, officers, employees, agents, partners, members, controlling persons
and affiliates from and against any losses, claims, damages or liabilities they
may incur arising out of any untrue or alleged untrue statement of material fact
contained in such registration statement, or any amendment or supplement
thereto, or arising out of or based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, or arising out of any violation of the
1933 Act or the Securities Exchange Act of 1934, as amended, in connection
therewith, provided that any such untrue or alleged untrue statement of material
fact or omission or alleged omission to state a material fact required or
necessary to be stated to make the statements therein not misleading was not
caused by the negligence or willful actions of Warrant Holder, and, provided
that Warrant Holder is entitled to indemnification hereunder, will reimburse
Warrant Holder and its directors, officers, employees, agents, controlling
persons and affiliates for any legal or other expenses reasonably incurred in
connection with investigating or defending any such action or claim as such
expenses are incurred.
(c) All expenses incurred by the Company in complying with Section 7(a),
including, without limitation, all registration and filing fees (including all
expenses incident to filing with the National Association of Securities Dealers,
Inc.), fees and expenses of complying with securities and blue sky laws, expense
allowances of the underwriters, underwriting discounts and commissions, printing
expenses, fees and disbursements of counsel or other advisor to the Company or
Holder, and of the accountants to Company or Holder, are herein called
"Registration Expenses."
(d) The Company shall pay for Registration Expenses (except for expenses
associated with counsel, other advisors and/or accountants of Holder) in
connection with each registration pursuant to Section 7(a). Furthermore, all
blue sky expenses required by law to be borne by seller or sellers in connection
with each registration pursuant to Section 7(a) shall be borne by the seller or
sellers therein in proportion to the number of eligible securities included by
each in such registration or in such other proportions as they may agree upon.
In the event of any dispute as to how the blue sky expenses are allocated, the
Company shall be entitled to apportion the expenses in a reasonable manner
between the various sellers.
8. GOVERNING LAW.
The terms and conditions of this Warrant shall be governed by and construed in
accordance with the laws of the State of California.
9. MISCELLANEOUS.
The headings in this Warrant are for purposes of convenience and reference only,
and shall not be deemed to constitute a part hereof. Neither this Warrant nor
any term hereof may be changed, waived, discharged or terminated orally but only
by an instrument in writing signed by the Company and the registered holder
hereof. All notices and other communications from the Company to the holder of
this Warrant shall be mailed by first-class registered or certified mail or
recognized commercial courier service, postage prepaid, to the address furnished
to the Company in writing by the last holder of this Warrant who shall have
furnished an address to the Company in writing.
___________, 200_ COMMTOUCH SOFTWARE LTD.
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------
▇▇▇▇▇▇ ▇▇▇▇▇▇, Chief Executive Officer
EXHIBIT A
NOTICE OF EXERCISE
TO: COMMTOUCH SOFTWARE LTD.
1. The undersigned hereby elects to purchase ___________ Shares of Commtouch
Software Ltd. pursuant to the terms of the attached Warrant, and tenders
herewith payment of the purchase price of such Shares in full, together with all
applicable transfer taxes, if any.
2. Please issue a certificate or certificates representing said Shares in the
name of the undersigned or in such other name as is specified below:
---------------------------------
(Name)
---------------------------------
---------------------------------
(Address)
-----------------------------------
Name of Warrant holder
-----------------------------------
Signature of Authorized Signatory
-----------------------------------
Print Name and Title
-----------------------------------
Date
EXHIBIT B
NOTICE OF CONVERSION
TO: COMMTOUCH SOFTWARE LTD.
1. The undersigned hereby elects to convert the attached Warrant into
such number of Ordinary Shares (the "Shares") of Commtouch Software Ltd. as is
determined pursuant to Section 2(d) of such Warrant, which conversion shall be
effected pursuant to the terms of the attached Warrant.
2. Please issue a certificate or certificates representing the Shares
in the name of the undersigned or in such other name as is specified below:
-------------------------------------
(Print Name)
-------------------------------------
(Address)
-------------------------------------
(Address)
3. The undersigned represents that the Shares are being acquired for
the account of the undersigned for investment and not with a view to, or for
resale in connection with, the distribution thereof and that the undersigned has
no present intention of distributing or reselling such shares.
(Date) (Signature)
(Print Name)
