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EXHIBIT 10.1
SECOND AMENDED AND RESTATED
SHAREHOLDERS AGREEMENT
This Second Amended and Restated Shareholders Agreement (this "AGREEMENT")
is entered into as of the 13th day of January, 2000 between Servicesoft
Technologies Inc., a Delaware corporation ("SERVICESOFT") and those shareholders
whose names are set forth on Schedule A. Except as otherwise indicated herein,
capitalized terms used herein are defined in Section 1 hereof.
WHEREAS, the Company, certain of the Major Shareholders (the "Original
Major Shareholders") and certain other parties entered into an Amended and
Restated Shareholders Agreement dated June 18, 1999 (the "Amended and Restated
Shareholders Agreement") which amended and restated a previous Stockholders
Agreement dated February 12, 1998;
WHEREAS, the Original Major Shareholders are holders of Common Stock, par
value $.01 per share ("Common Stock"), Series H Convertible Preferred Stock, par
value $.01 per share (the "Series H Preferred"), Series I Convertible Preferred
Stock, par value $.01 per share (the "Series I Preferred"), of the Company
and/or Exchangeable Shares, which are exchangeable into Common Stock as Series H
Preferred, as the case may be;
WHEREAS, the holders of Exchangeable Shares possess certain rights,
including the right to vote as a stockholder of the Company as if such
Exchangeable Shares were Common Stock or Series H Preferred;
WHEREAS, the Company and the holders (the "SERIES J HOLDERS") of shares of
its Series J Convertible Preferred Stock, par value $.01 per share (the "SERIES
J PREFERRED"; and collectively with the Series H Preferred and the Series I
Preferred, the "Preferred Stock"), identified on Schedule A have entered into a
Series J Convertible Preferred Stock Purchase Agreement dated as of the date
hereof (the "SERIES J PURCHASE AGREEMENT");
WHEREAS, as a condition to closing under the Series J Purchase Agreement
and as an inducement to the Series J Holders to consummate the transactions
contemplated by the Series J Purchase Agreement, the Company and the undersigned
parties desire to amend and restate the Amended and Restated Agreement and to
execute and deliver this Agreement;
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, receipt of which is hereby acknowledged, the parties to
this Agreement agree to amend and restate the Amended and Restated Agreement as
follows:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
"BOARD" means the Board of Directors of the Company.
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"BUSINESS DAY" means a day, other than a Saturday or Sunday, on which
the principal commercial banks located in New York and Toronto are open for
business during normal banking hours.
"CERTIFICATE" means the Company's Certificate of Incorporation, as
amended.
"COMBINATION AGREEMENT" means that certain Combination Agreement dated
February 12, 1999, whereby the Company completed a transaction with Balisoft and
the shareholders of Balisoft received Exchangeable Shares.
"COMMISSION" means the Securities and Exchange Commission, or any other
federal agency at the time administering the Securities Act.
"EXCHANGEABLE SHARES" means the Exchangeable Common Shares and
Exchangeable Preferred Shares of Servicesoft Technologies (Canada), Inc.
"INITIAL PUBLIC OFFERING" means the initial offering to the public of
the Company's Securities pursuant to a firm commitment underwriting pursuant to
the Securities Act.
"MAJOR SHAREHOLDER" means (i) each shareholder listed on Schedule A and
(ii) a Permitted Transferee (as defined in Section 5) of any Major Shareholder.
"PERSON" includes any individual, legal or personal representative,
partnership, company, corporation, incorporated syndicate, unincorporated or
incorporated association, trust or governmental agency, howsoever designated or
constituted.
"QUALIFIED PUBLIC OFFERING" means a firm commitment, underwritten
public offering pursuant to an effective registration statement under the
Securities Act of the Company's Common Stock to the public with aggregate gross
proceeds to the Company of not less than $30,000,000 and which places a value on
the Company of not less than $250,000,000.
"REGISTRATION RIGHTS AGREEMENT" means the Seventh Amended and Restated
Registration Rights Agreement between the Company and certain of the Major
Shareholders of even date herewith.
"SECURITIES" means, with respect to any Person, such Person's
"securities" as defined in Section 2(1) of the Securities Act and includes such
Person's capital stock or other equity interests or any options, warrants or
other securities or rights that are directly or indirectly convertible into, or
exercisable or exchangeable for, such Person's capital stock or other equity
interests.
"SECURITIES ACT" means the United States Securities Act of 1933, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at this time.
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"SERIES I PURCHASE AGREEMENT" means that certain Series I Purchase
Agreement dated as of June 18, 1999 by and among the Company and the holders of
Series I Preferred.
"SUBSIDIARY," or collectively, "SUBSIDIARIES," of any Person
means any corporation or other entity of which securities or other ownership
interests having ordinary voting power to elect a majority of the Board of
Directors or other Persons performing similar functions are directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of
such Person.
2. Prohibited Transfer.
(a) None of the Major Shareholders shall sell, assign, transfer,
pledge, hypothecate, mortgage or dispose of, by gift or otherwise, or in any way
encumber, all or any part of the Servicesoft Shares (as hereinafter defined)
owned by it except in compliance with the terms of this Agreement.
(b) None of the Major Shareholders shall sell or dispose of all or any
part of the Servicesoft Shares for any consideration other than cash or publicly
traded securities without the approval of the Board of Directors of the Company
(the "BOARD"), such approval to be provided or withheld on a consistent basis
among Major Shareholders.
(c) For purposes of this Agreement, the term "SERVICESOFT SHARES" shall
mean and include all shares of capital stock of the Company and all Exchangeable
Shares owned by a Major Shareholder, whether now owned or hereafter acquired and
whether owned by a Major Shareholder or a transferee thereof. For purposes of
calculating the number of Servicesoft Shares owned by a Major Shareholder under
this Agreement, all Exchangeable Shares held by them shall be deemed to have
been exchanged for the Servicesoft Shares for which they may be exchanged and
all other shares of Common Stock which a Major Shareholder has the right to
acquire from the Company upon the conversion, exercise or exchange of any of the
Securities of the Company or its Subsidiaries then owned by such Major
Shareholder shall be deemed to be Servicesoft Shares then owned by such Major
Shareholder.
3. Pre-Emptive Rights on Issues.
(a) If any additional New Securities (as defined below) are to be
issued by the Company other than pursuant to (i) the Company's 1994 Stock Option
Plan, the Company's 1999 Stock Option and Grant Plan or any other stock option
or grant plan approved by the Board, (ii) an exercise of the exchange rights of
any of the Exchangeable Shares, (iii) any stock splits or stock dividends, (iv)
bank and leasing warrants (not to exceed 5% of the total fully diluted equity of
the Company), (v) any business combination transactions, provided, that such
Securities are issued at fair market value, (vi) the exercise, conversion or
exchange of Securities of the Company outstanding from time to time, the Company
shall first offer such New Securities to the Major Shareholders by a written
invitation to subscribe for the New Securities (the "INVITATION"). "NEW
SECURITIES" means (i) shares of Common Stock, (ii) any other equity security of
the Company (other than any shares of Series J Preferred issued and sold
pursuant to the Series J Purchase Agreement), (iii) any debt security that is a
combination of debt and equity,
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(iv) any debt security of the Company that by its terms is convertible into or
exchangeable for any equity security of the Company, or (v) any option, warrant
or other right to subscribe for or purchase or otherwise acquire any equity
security or any debt security of the Company.
(b) Upon receiving an Invitation, each of the Major Shareholders shall
have the right to purchase that number of New Securities as shall be equal to
the number of New Securities multiplied by a fraction, the numerator of which
shall be the number of Servicesoft Shares (on an as-if converted basis) then
owned by such Major Shareholder and the denominator of which shall be the total
number of shares of Common Stock determined on a fully diluted, as-if converted
or exercised basis. The Major Shareholders shall have ten days from their
receipt of the Invitation in which to give a notice to the Company of such Major
Shareholder's intention to purchase all or any of the New Securities to which it
is entitled and shall indicate in such notice the maximum number of New
Securities which such Major Shareholder is willing to purchase (which number may
be greater than its pro rata entitlement set out above). If any Major
Shareholder does not accept its full pro rata entitlement as set out in this
Section 3(b), such unaccepted New Securities shall be deemed to have been
offered to the Major Shareholders who indicated that they would accept greater
than their pro rata entitlement and each such Major Shareholder is entitled to
acquire such unaccepted New Securities pro rata based upon the number of
Servicesoft Shares owned by all such Major Shareholders.
(c) In the event that after the Invitation has been issued and the ten
day period referred to above has elapsed, there remain some of the New
Securities which have not been taken up and paid for by the Major Shareholders,
then the New Securities not so taken up (for the purposes of this Section 3, the
"REMAINING NEW SECURITIES") may be issued to such Persons as the directors in
their discretion determine, provided, that such Persons agree to be bound by
this Agreement and to become parties hereto, and provided, further that any such
issue of the Remaining New Securities must be completed within 60 days of the
Invitation given with respect to the said New Securities.
4. Rights of First Refusal and Co-Sale on Dispositions.
(a) If at any time any Major Shareholder desires to sell or transfer
all or any part of the Servicesoft Shares owned by such Major Shareholder, such
Major Shareholder (the "OFFEROR"), shall submit, prior to consummating any such
sale or transfer, a written offer (the "OFFER") concurrently to the Company and
to each of the Major Shareholders to sell such Servicesoft Shares (for purposes
of this Section 4, the "OFFERED SHARES").
(b) Such Offer shall be at least as favorable to the Company and the
Major Shareholders as those on which the Offeror proposes to sell the Offered
Shares to the prospective purchaser or transferee (the "PROPOSED TRANSFEREE").
The Offer shall disclose the name and address of the Proposed Transferee, the
number of Offered Shares proposed to be sold, the total number of Servicesoft
Shares owned by the Offeror, the terms and conditions, including price, of the
proposed sale and any other material facts relating to the proposed sale. The
Offer shall further state that either the Company or the Major Shareholders may
acquire, in accordance with the provisions of this Agreement, all (but not less
than all) of the Offered Shares for the price and upon the other terms and
conditions, including deferred payment (if applicable), set forth therein.
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(c) The Company shall communicate in writing its election to either
purchase all (but no less than all) or none of the Offered Shares to the Offeror
and to the Major Shareholders, which communication shall be delivered in person
or mailed to the Offeror and the Major Shareholders at the address set forth in
accordance with Section 10 below within seven days of the date the Offer is
made. Such communication shall, when taken in conjunction with the Offer, be
deemed to constitute a valid, legally binding and enforceable agreement for the
sale and purchase of such Offered Shares. Sale of the Offered Shares to be sold
to the Company pursuant to this Section 4 shall be made at the offices of the
Company on the 20th day following the date the Offer is made (or if such 20th
day is not a business day, then on the next succeeding business day). Such sale
shall be effected by the Offeror's delivery to the Company of a certificate or
certificates evidencing the Offered Shares to be purchased by it, duly endorsed
for transfer to the Company against payment to the Offeror of the purchase price
therefor by the Company.
(d) In the event that the Company elects not to purchase the Offered
Shares, each Major Shareholder shall have the absolute right to purchase that
number of Offered Shares as shall be equal to the number of Offered Shares
multiplied by a fraction, the numerator of which shall be the number of
Servicesoft Shares then owned by such Major Shareholder and the denominator of
which shall be the aggregate number of Servicesoft Shares then owned by all of
the non-selling Major Shareholders. The amount of Offered Shares that each Major
Shareholder is entitled to purchase under this Section 4(d) shall be referred to
as its "PERCENTAGE."
(e) The non-selling Major Shareholders shall have a right of
oversubscription such that if any Major Shareholder fails to accept the Offer as
to its Percentage, the other non-selling Major Shareholders shall, among them,
have the right to purchase up to the balance of the Offered Shares not so
purchased. Such right of oversubscription may be exercised by a Major
Shareholder by accepting the Offer as to more than its Percentage. If, as a
result thereof, such oversubscriptions exceed the total number of Offered Shares
available in respect of such oversubscription privilege, the oversubscribing
Major Shareholders shall be cut back with respect to their oversubscriptions on
a pro rata basis in accordance with their respective Percentages or as they may
otherwise agree among themselves.
(f) If a Major Shareholder desires to purchase all or any part of the
Offered Shares, said Major Shareholder shall communicate in writing its election
to purchase to the Offeror, which communication shall state the number of
Offered Shares said Major Shareholder desires to purchase and shall be delivered
in person or mailed to the Offeror at the address set forth in accordance with
Section 12 below within 14 days of the date of the Offer in Section 4(b) above
is made. Such communication shall, when taken in conjunction with the Offer, be
deemed to constitute a valid, legally binding and enforceable agreement for sale
and purchase of such Offered Shares (subject to the aforesaid limitations as to
a Major Shareholder's right to purchase more than its Percentage).
(g) If the Company and/or the Major Shareholders fail to exercise their
respective rights to purchase all of the shares of Offered Shares described in
the Offer following the exercise or expiration of the rights of purchase
described above, then each Major Shareholder shall then have the right,
exercisable upon written notice to the Offeror within 21 days after
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delivery of the Offer, to participate as provided below in this Section 4(g) in
such sale of Offered Shares on the same terms and conditions; provided, however,
that the Series I Holders and Series J Holders shall not be eligible to
participate in such sale or transfer in accordance with the provisions of this
Section 4(g); and provided further, however, that the co-sale provisions of this
Section 4(g) shall not apply to sales or transfers of shares of Series I
Preferred (or any Common Stock issued upon conversion thereof) made by the
Series I Holders or to sales or transfers of shares of Series J Preferred (or
any Common Stock issued upon conversion thereof) made by the Series J Holders.
Such notice shall indicate the number of Servicesoft Shares such Major
Shareholder wishes to sell under such Major Shareholder's right to participate.
To the extent one or more of the Major Shareholders exercises such right of
participation in accordance with the terms and conditions set forth below, the
number of Servicesoft Shares that the Offeror may sell in the transaction shall
be correspondingly reduced.
(h) Each Major Shareholder may sell all or any part of that number of
Servicesoft Shares equal to the product obtained by multiplying (x) the
aggregate number of shares of Offered Shares covered by the Offer (less shares
purchased by the Company or the Major Shareholders pursuant to Sections 4(c) and
4(d)) by (y) a fraction the numerator of which is the number of Servicesoft
Shares held by the Major Shareholder at the time of the sale or transfer and the
denominator of which the aggregate number of Servicesoft Shares then owned by
all non-selling Major Shareholders on the date of the Offer.
(i) Each Major Shareholder who elects to participate in the sale
pursuant to this Section 4(g) (a "PARTICIPANT") shall effect its participation
in the sale by promptly delivering to the Company as escrow agent (the "ESCROW
AGENT") for transfer to the Proposed Transferee one or more certificates,
properly endorsed for transfer which represent:
(i) the type and number of shares of Common Stock which such
Participant elects to sell; or
(ii) that number of shares of Series H Preferred or Exchangeable
Shares which is at such time convertible into the number of shares of Common
Stock which such Participant elects to sell; provided, however, that if the
Proposed Transferee objects to the delivery of such Series H Preferred,
Exchangeable Shares, Series I Preferred or Series J Preferred in lieu of Common
Stock, such Participant shall convert such Series H Preferred, Exchangeable
Shares, Series I Preferred or Series J Preferred into Common Stock and deliver
Common Stock as provided above. The Company agrees to make any such conversion
concurrent with the actual transfer of such shares to the purchaser and
contingent on such transfer.
(j) The stock certificate or certificates that the Participant delivers
to the Escrow Agent shall be transferred to the Proposed Transferee in
consummation of the sale of Servicesoft Shares pursuant to the terms and
conditions specified in the Offer, and the Escrow Agent shall concurrently
therewith remit to such Participant that portion of the sale proceeds to which
such Participant is entitled by reason of its participation in such sale. To the
extent that any Proposed Transferee prohibits such assignment or otherwise
refuses to purchase shares or other Securities from a Participant exercising its
rights of co-sale hereunder, such Offeror shall not sell to such Proposed
Transferee any Servicesoft Shares unless and until, simultaneously with
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such sale, such Offeror shall purchase such shares or other Securities from such
Participant on the same terms and conditions specified in the Offer.
(k) The exercise or non-exercise of the rights of the Participants
hereunder to participate in one or more transfers of Servicesoft Shares made by
other Major Shareholders shall not adversely affect their rights to participate
in subsequent sales of Servicesoft Shares.
(l) If none of the Major Shareholders elect to participate in the sale
of the Offered Shares, such Offeror may, not later than 120 days following
delivery to the Company of the original Offer, enter into an agreement providing
for the closing of the sale or transfer of the Offered Shares covered by the
Offer on terms and conditions materially no more favorable to the Proposed
Transferee than those described in the Offer; provided, however, that no Major
Shareholder shall be permitted to transfer the Offered Shares to a competitor of
the Company. Any proposed transfer on terms and conditions materially more
favorable to the Proposed Transferee than those described in the Offer, as well
as any subsequent proposed transfer of any of the Servicesoft Shares held by the
Offeror, shall again be subject to the co-sale rights and right of first refusal
of the Major Shareholders and shall require compliance by a Offeror with the
procedures described in this Section 4.
(m) Sales of the Offered Shares to be sold to the purchasing Major
Shareholders pursuant to this Section 4 shall be made at the offices of the
Company on the 20th day following the date the Offer is made (or if such 20th
day is not a business day, then on the next succeeding business day). Such sales
shall be effected by the Offeror's delivery to each purchasing Major Shareholder
of a certificate or certificates evidencing the Offered Shares to be purchased
by it, duly endorsed for transfer to such purchasing Major Shareholder against
payment to the Offeror of the purchase price therefor by such purchasing Major
Shareholder.
(n) At the Company's option, it can require that a conveyance of
Servicesoft Shares to a person other than a Major Shareholder be conditioned
upon the receipt by the Company of either (i) an opinion of legal counsel
reasonably satisfactory to it that no violation of any securities laws or loss
of exemption from registration under any such laws will result from such a
conveyance, or (ii) a "no action" letter from the Commission to the same effect
covering such conveyance and an equivalent ruling from each applicable state
authority.
(o) The Certificate provides that all of the Company's stockholders
(including those who are not Major Shareholders) except the Series I Holders and
Series J Holders are prohibited from selling or transferring any shares of
Common Stock of the Company without first offering the Company a first right of
refusal, as more fully specified in the Certificate.
(p) Nothing in the foregoing subsections of this Section 4 shall be
construed to alter the fact that the Exchangeable Shares are not transferrable
by their holders except according to their terms as set out in the articles of
incorporation of Servicesoft Canada.
5. Permitted Transfers. Anything herein to the contrary notwithstanding,
the provisions of Section 4 shall not apply to transfers to (i) a Related Person
(as defined below) or (ii) a trust for the benefit of any individual Major
Shareholder, provided, that the trust instrument
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governing said trust shall provide that such Major Shareholder, as trustee,
shall retain sole and exclusive control over the voting and disposition of said
Servicesoft Shares until the termination of this Agreement, provided, that such
transferee is not competitor of the Company and that such transfer does not
violate any applicable federal or state securities laws (each, a "Permitted
Transferee"). A "Related Person" means with respect to any Major Shareholder (x)
any Person which is controlled by, controls or is under common control with such
Holder, (y) any partner, shareholder or similar equity holder of such Major
Shareholder or such Person described in clause (x) above which receives
securities in connection with a windup, liquidation or similar dissolution of
such Major Shareholder or such Person, or (z) any individual, charitable trust
or similar organization which receives Servicesoft Shares from a Major
Shareholder as part of a testamentary transfer by such Major Shareholder. For
purposes hereof, "control" and its derivatives shall mean, with respect to any
Person, the power to direct and control the management or policies of such
Person, whether through the beneficial ownership of voting securities or
interests, by contract or agreement or otherwise. In the event of any such
transfer, other than pursuant to clause (ii) of this Section 5, such Permitted
Transferee of the Servicesoft Shares shall hold the Servicesoft Shares so
acquired with all the rights conferred by, and subject to all the restrictions
imposed by, this Agreement and shall deemed a Major Shareholder for all purposes
hereof.
6. Board of Directors.
(a) Election of Directors. Each Major Shareholder agrees to vote all
of its Servicesoft Shares at all elections of directors of the Company so that
the Board shall consist of up to eight members. Pursuant to the foregoing, each
Major Shareholder agrees to vote its Servicesoft Shares in order to elect the
following persons to the Board:
(i) the Chief Executive Officer of the Company, who shall
initially be Xxxxx Xxxxxx,
(ii) one nominee designated by a majority-in-interest of the
Major Shareholders holding more than 500,000 Exchangeable Shares exchangeable
for Series H Preferred as of the date hereof, acting collectively,
(iii) one nominee designated by a majority-in-interest of the
Major Shareholders holding Series H Preferred as of the date hereof, acting
collectively,
(iv) one nominee of CIBC WMV Inc. ("CIBC"),
(v) one nominee of Sofinov, Societe Financiere D'Innovation Inc.,
unless such nominee is the nominee of the Exchangeable Shares pursuant to clause
(ii) above, and
(vi) one nominee to be agreed upon by the Board, who shall
initially be Xxxx Xxxxxxxxx, and
(vii) two independent nominees to be agreed upon by the Board.
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Each Major Shareholder further agrees to vote its Servicesoft Shares to
remove any member of the Board (a "DIRECTOR") whose removal is requested by the
Person or Persons who nominated such Director. Additionally, the Board shall
have the discretion to appoint additional persons to attend all regularly
scheduled Board meetings as observers, subject to Board approval as to the
specific individuals who can attend meetings. CIBC, FT Ventures and Xxxxxxx
Xxxxx shall each have the right to appoint one such observer (together, the
"PERMITTED OBSERVERS"), and such Permitted Observers shall have the right to
attend any board meeting at which the Director nominated by such entity is not
present unless to do so would, in the opinion of the Company, unreasonably
disrupt the conduct of the meeting. If and when the Board conducts such meetings
by telephone, the Permitted Observers will be invited to participate. The
Permitted Observers will be sent notices of such Board meetings and a copy of
all Board meeting materials in the same manner as and when Directors are sent
such notices and materials, which materials are to be treated as strictly
confidential by such Permitted Observers and are not to be made available or
distributed to any other person. Directors and any observers are expected to
recuse themselves from any meetings or portions of meetings regarding subjects
that involve a potential or actual conflict of interest for the Major
Shareholder represented by that person and the Board can exclude a Director or
observer from a meeting under such circumstances.
(b) Meeting; Expenses. The Company shall use its best efforts to ensure
that meetings of its Board are held at least four times each year and at least
once each calendar quarter. The Company shall also provide to each Director and
each Permitted Observer upon request copies of all notices, reports, minutes and
consents with respect to any committee. Directors shall be reimbursed for their
reasonable expenses in attending Board meetings. The reasonable expenses of the
Permitted Observers shall also be reimbursed.
(c) Committees. In the event the Directors delegate any of their powers
which may be so delegated to any committee of the Board, for so long as CIBC is
entitled to nominate a Director to the Board, the members of the Board will
nominate and elect to each such committee the Director nominated by CIBC.
(d) Information. The Company acknowledges that a Major Shareholder may
have, from time to time, information that may be of interest to the Company
regarding a wide variety of matters including, by way of example only, (1) the
Major Shareholder's technologies, plans and services, and plans and strategies
relating thereto, (2) current and future investments the Major Shareholder has
made, may make, may consider, or may become aware of with respect to other
companies and other technologies, products and services, including, without
limitation, technologies, products and services that may be competitive with the
Company's, and (3) developments with respect to the technologies, products and
services, and plans and strategies relating thereto, of other companies,
including, without limitation, companies that may be competitive with the
Company ("INFORMATION"). Such Information may or may not be known by the
Director or observer appointed by the Major Shareholder. The Company, as a
material part of the consideration for this Agreement, agrees that the Major
Shareholder and its Director or observer (as applicable) shall have no duty to
disclose any Information to the Company or permit the Company to participate in
any projects or investments based on any Information, or to otherwise take
advantage of any opportunity that may be of interest to the Company if it were
aware of such Information, and hereby waives, to the extent permitted by law,
any claim based
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on the corporate opportunity doctrine or otherwise that could limit the Major
Shareholder's ability to pursue the opportunities based on such Information or
that would require the Major Shareholder or observer to disclose any such
Information to the Company or offer any opportunity relating thereto to the
Company.
7. Rights in Corporate Events.
(a) Corporate Event. A "CORPORATE EVENT" shall mean any of the
following, whether accomplished through one or a series of related transactions:
(i) the acquisition of all or substantially all the assets of the Company, (ii)
an acquisition of the Company by consolidation, merger, share purchase or
exchange, or other reorganization or transaction in which the holders of all of
the outstanding Servicesoft Shares immediately prior to such transaction own,
immediately after such transaction, Securities representing less than 50% of the
voting power of the corporation or any entity surviving such transaction, and
(iii) any other transaction or series of related transactions (excluding any
exercise or exercises of stock options and the warrant issued to Intel
Corporation ("INTEL") to purchase Series H Preferred) that would result in a
greater than 25% change in the total outstanding number of shares of Series H
Preferred or any other class of voting Securities of the Company. The Company
agrees that it will provide Intel with written notice (by telefax and regular
mail) of any written offer from another Major Shareholder for a proposed
Corporate Event no less than 30 days prior to the date the Company accepts such
offer or proposed Corporate Event unless, in the Board's reasonable judgement,
the Company has less than 30 days to act on an offer in which event it will
provide notice to Intel within one business day of when it first receives such
offer for a proposed Corporate Event. In addition, the Company agrees that it
will provide Intel, within one business day of the Company's becoming aware
thereof, with written notice of any written offer from another Major Shareholder
to acquire 20% or more of the Company's outstanding voting Securities.
(b) Unsolicited Offer/Solicited Offer. An "UNSOLICITED OFFER" means
(i) any offer for a proposed Corporate Event received from another Major
Shareholder in the absence of any act taken by any officer or Director of the
Company with the intent of soliciting such offer, and (ii) any proposal or offer
by the Company to such third Major Shareholder or from such third Major
Shareholder for a proposed Corporate Event arising from negotiations that
followed the receipt of an offer described in Section 7(b)(i). Any offer for a
proposed Corporate Event that is not an Unsolicited Offer shall be deemed a
Solicited Offer.
(c) Solicitation of Offers for Corporate Events.
(i) Solicitation Notice. The Company agrees that prior to
soliciting any offers (other than an offer described in Section 7(a)(ii) above)
for a proposed Corporate Event (a "PROPOSED EVENT"), the Company will provide
Intel with written notice of such intent to solicit offers (a "SOLICITATION
NOTICE"), including such terms and conditions of the Proposed Event as are
provided to other prospective offerors for the Corporate Event.
(ii) Different Terms and Conditions. In the event that the
Company proposes to accept a Solicited Offer for the consummation of a Proposed
Event on terms and conditions that are not at least as favorable as the terms
and conditions specified in the last
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Solicitation Notice, the Company agrees to provide Intel with Solicitation
Notice pursuant to Section 7(c)(i). Without limiting the generality of the
foregoing, a purchase price that is 95% or less of the purchase price in the
last Solicitation Notice received by Intel shall be deemed not to be at least as
favorable as the terms and conditions as specified in the last Solicitation
Notice and shall require the Company to deliver to Intel a new Solicitation
Notice.
(d) Unsolicited Offers for Corporate Event. If the Company receives a
written Unsolicited Offer from another Major Shareholder for a proposed
Corporate Event (an "OFFERED EVENT"), the Company agrees that it will provide
Intel with written notice of the Offered Event including such terms and
conditions of the Offered Event as are provided to prospective offerors for the
Offered Event other than the Major Shareholder making the Unsolicited Offer. If
the Company proposes to accept the Offered Event or recommend that its
shareholders approve the Offered Event, the Company agrees that it will provide
Intel with written notice of its intention.
(e) Confidentiality and Fiduciary Obligations. No action of the Company
(including of the Board) shall be prohibited by or be deemed a breach of this
Section 7 if the Board determines in good faith, upon the advice of outside
legal counsel, that such action would be required by reasons of a
confidentiality agreement with another Major Shareholder offeror or the
fiduciary duties of the Board to the Company's stockholders under applicable
law, provided, however, that in the event that the Company takes an action
pursuant to this Section 7 and such action involves the solicitation of, or the
proposal by the Company to accept, an offer for a proposed Corporate Event, the
parties agree, notwithstanding any other provision herein, that such proposed
Corporate Event will be treated as an Offered Event pursuant to the terms of
Section 7(d).
(f) Termination of Rights. The rights of Intel under Sections 7(b)
through 7(e) shall terminate on February 10, 2003; provided, however, that
Intel's rights under such sections of this Section 7 shall remain in full force
and effect with respect to any Corporate Event, Unsolicited Offer, Solicited
Offer and Offered Event for which Intel has received, or been entitled to
receive, notice from the Company prior to such date.
8. Liquidation Preference. In the event of a Liquidation Event (as defined
in the Certificate), the Certificate provides that the holders of Series H
Preferred (including the holders of Exchangeable Shares exchangeable for Series
H Preferred) shall be entitled to receive the Series H Preference Amount (as
defined therein). Such holders agree that the Series H Preference Amount shall
be distributed among them based on their prior status as shareholders of the
Company or Balisoft Technologies, Inc. as Ontario, Canada corporation
("BALISOFT") on the basis specified in Schedule B (the "INDIVIDUAL PREFERENCE
AMOUNTS"). If the assets or surplus funds to be distributed to the holders of
Series H Preferred (including the holders of Exchangeable Shares exchangeable
for Series H Preferred), the Series I Preferred and the Series J Preferred in
accordance with the Certificate are insufficient to permit the payment to such
holders of their full Individual Preference Amounts, the assets and surplus
funds legally available for distribution shall be distributed ratably among such
holders in proportion to the full Individual Preference Amounts each such holder
would otherwise be entitled to receive as between the holders of the Series H
Preferred (collectively), the Series I Preferred (collectively)
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and the Series J Preferred (collectively) in accordance with the Certificate,
and as between each individual holder of Series H Preferred in accordance with
this Agreement.
9. Drag Along. In the event that the Company's shareholders that
beneficially own on a collective basis at least 65% of the issued and
outstanding Securities of the Company (the "Approving Shareholders") determine
to approve any transaction between the Company and a third party that
contemplates the acquisition of 100% of the Company's outstanding Securities by
the third party or determines to tender or exchange their Securities in a
transaction proposed by any third party in which such third party would acquire
100% of the Company's outstanding Securities directly from the shareholders of
the Company, then in such event the Approving Shareholders shall have the right,
exercisable upon ten days' prior written notice (the "Transaction Notice"), to
require each of the Major Shareholders and the Executive to approve such
transaction and tender or exchange the Securities of the Company currently held
by them to such third party offeror on the same terms and conditions, including
the per share price and date of sale, as are received by the Approving
Shareholders and stated in the Transaction Notice.
10. Restrictions.
(a) So long as any Series I Preferred is outstanding (as adjusted for
any stock dividends, combinations, splits, recapitalizations and the like), the
Company shall not, without first obtaining the affirmative vote or written
consent of the holders of more 50% of the Series I Preferred then outstanding:
(i) amend or repeal any provision of, or add any provision to,
the Certificate or the By-Laws of the Company that changes the voting
powers, preferences, or other special rights or privileges, or restrictions
of the Series I Preferred;
(ii) authorize or designate, whether by reclassification or
otherwise, any new class or series of stock or any other securities
convertible into equity securities of the Company ranking senior to the
Series I Preferred in rights of redemption, liquidation preference, voting
or dividends;
(b) So long as any Series J Preferred is outstanding (as adjusted for
any stock dividends, combinations, splits, recapitalizations and the like), the
Company shall not, without first obtaining the affirmative vote or written
consent of the holders of more 50% of the Series J Preferred then outstanding:
(i) amend or repeal any provision of, or add any provision to,
the Certificate or the By-Laws of the Company that adversely affects the
voting powers, preferences, or other special rights or privileges, or
restrictions of the Series J Preferred;
(ii) authorize or designate, whether by reclassification or
otherwise, any new class or series of stock or any other securities
convertible into equity securities of the Company ranking senior or pari
passu to the Series J Preferred in rights of redemption, liquidation
preference, voting or dividends;
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(c) So long as any Series I Preferred or Series J Preferred is
outstanding (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like), the Company shall not, without first obtaining
the affirmative vote or written consent of the holders of more 50% of the Series
I Preferred and Series J Preferred (voting as a single class) then outstanding:
(i) amend or repeal any provision of, or add any provision to
either Sections 10(c) or (e) or increase or grant any additional rights to
the holders of the Series H Preferred under Section 10(d); or
(ii) redeem, purchase or otherwise acquire for value (or pay into
or set aside for a sinking fund for such purpose) any share or shares of
Common Stock or Preferred Stock otherwise than by redemption in accordance
with Article IV, Section B(5) of the Certificate; provided, that this
restriction shall not apply to the repurchase of shares of Common Stock
from employees, officers, directors, consultants or other persons
performing services for the Company or any of its Subsidiaries pursuant to
agreements under which the Company has the option to repurchase such shares
at cost or the repurchase of shares of Common Stock or Preferred Stock upon
exercise of the Company's right of first refusal in accordance with Article
V of the Certificate or Section 4 of this Agreement.
(d) So long as any Series H Preferred is outstanding, the Company shall
not, without first obtaining the affirmative vote or written consent of the
holders of more than 50% of the Series H Preferred (including the Exchangeable
Shares exchangeable for the Series H Preferred (voting as a separate class) then
outstanding:
(i) amend or repeal any provision of, or add any provision to,
the Certificate or the By-Laws of the Company that changes the voting powers,
preferences, or other special rights or privileges, or restrictions of the
Series H Preferred; or
(ii) authorize or designate, whether by reclassification or
otherwise, any new class or series of stock or any other securities convertible
into equity securities of the Company ranking senior to the Series H Preferred
in rights of redemption, liquidation preference, voting or dividends;
(e) So long as any Series H, Series I and/or Series J Preferred are
outstanding, the Company shall not, without first obtaining the affirmative vote
or written consent of more than 50% of the Series H (including the Exchangeable
Shares for the Series H Preferred), Series I Preferred and Series J Preferred
(voting together as a single class) then outstanding:
(i) reclassify any Common Stock into shares having any preference
or priority as to dividends or assets superior to or on a par with such
preference or priority of any Preferred Stock;
(ii) issue or pay or declare any dividend or distribution on any
shares of its capital stock or other equity securities (other than shares of
Common Stock) or apply any of its assets to the redemption, retirement, purchase
or other acquisition directly or indirectly,
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through subsidiaries or otherwise, of any shares of its capital stock or other
equity securities other than (A) the Series H, Series I and Series J Preferred
except pursuant to and in accordance with the terms of the Certificate, (B) the
repurchase of shares of Common Stock from employees, officers, directors,
consultants or other persons performing services for the Company or any of its
Subsidiaries pursuant to agreements under which the Company has the option to
repurchase such shares at cost or (C) the repurchase of shares of Common Stock
or Preferred Stock upon exercise of the Company's right of first refusal in
accordance with Article V of the Certificate or Section 4 of this Agreement;
(iii) authorize or designate, whether by reclassification or
otherwise, any new class or series of stock or any other securities convertible
into equity securities of the Company ranking on parity with any Preferred Stock
in rights of redemption, liquidation preference, voting or dividends or any
increase in the authorized or designated number of any such new class or series;
(iv) consolidate or merge into or with any other entity or
entities (except a consolidation or merger in which the beneficial owners of the
Company's capital stock immediately prior to such transaction continue to hold
directly or indirectly not less than 51% of the voting power in the resulting
entity), or sell, mortgage or transfer all or substantially all its assets, or
enter into any other transaction or series of transactions the effect of which
would be the transfer in a single or series of related transactions of all or
substantially all of the assets of Company;
(v) permit any Subsidiary to consolidate or merge into or with
any other entity or entities (except a consolidation or merger in which either
the Company or the beneficial owners of the Company's capital stock immediately
prior to such transaction continue to hold directly or indirectly not less than
51% of the voting power in the resulting entity), or sell, mortgage or transfer
all or substantially all the assets of any Subsidiary, or enter into any other
transaction or series of transactions the effect of which would be the transfer
in a single or series of related transactions of all or substantially all of the
assets of any Subsidiary, except that any Subsidiary may (A) consolidate or
merge into or with any other Subsidiary or the Company, or (B) sell or transfer
all or substantially all of its assets to any other Subsidiary or the Company;
(vi) authorize any increase or decrease (other than by redemption
or conversion) in the authorized number of shares of Common Stock or Preferred
Stock;
(vii) increase the number of shares of Common Stock reserved for
issuance under the Corporation's stock option and grant plans without the
approval of a majority of the members of the Board of Directors who are not
employees of the Company;
(viii) approve any voluntary dissolution, liquidation or winding
up of the affairs of the Company;
(ix) make, or permit any Subsidiary to make, any material change
in the nature of its business as set forth in its current operating plan; or
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(x) increase the authorized size of the Board above eight
members.
11. Additional Covenants.
(a) Financial Statements, Reports, Etc. The Company shall furnish the
following information to each Major Shareholder based upon the understanding of
such Major Shareholder that such information may be used solely for evaluating
the Company, and that it shall not be disclosed to any third party, except as
provided in this Agreement:
(i) within 90 days after the end of each fiscal year of the
Company a consolidated balance sheet of the Company and its Subsidiaries, if
any, as of the end of such fiscal year and the related consolidated statements
of income and cash flows for the fiscal year then ended, prepared in accordance
with generally accepted accounting principles consistently applied and setting
forth in each case in comparative form the figures for the previous fiscal year,
all in reasonable detail. Such financial statements shall be certified by a firm
of independent public accountants of recognized national standing selected by
the Board, with the approval of the Company's stockholders;
(ii) within 30 days after the end of each calendar quarter in
each fiscal year (other than the last month in each fiscal year) a consolidated
balance sheet of the Company and its Subsidiaries, if any, and the related
consolidated statements of income and cash flows, unaudited but prepared in
accordance with generally accepted accounting principles and certified by the
Chief Financial Officer of the Company, such consolidated balance sheet to be as
of the end of such quarter and such consolidated statements of income and cash
flows to be for such quarter and for the period from the beginning of the fiscal
year to the end of such quarter, in each case with such statements as requested
by the Board;
(iii) (x) within 30 days after the beginning of each fiscal year
an annual budget and operating plan for such fiscal year (and as soon as
available, any subsequent revisions thereto); and (y) as soon as practicable
after the end of each month, and in any event within 30 days thereafter, a
balance sheet of the Company as of the end of each such month, and a statement
of income and statement of cash flows of the Company for such month and for the
current fiscal year to date, including a comparison to budget and plan figures
for such period, prepared in accordance with generally accepted accounting
principles consistently applied, with the exception that no notes need be
attached to such statements and year-end audit adjustments need not have been
made;
(iv) at the time of delivery of each annual financial statement
pursuant to Section 10(a)(ii), a certificate executed by the Chief Financial
Officer of the Company stating that such officer has caused this Agreement and
the terms of the Series H, Series I and Series J Preferred to be reviewed and
has no knowledge of any default by the Company in the performance or observance
of any of the provisions of this Agreement or the Series H, Series I and Series
J Preferred or, if such officer has such knowledge, specifying such default and
the nature thereof;
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(v) at the time of delivery of each quarterly statement pursuant
to Section 10(a)(ii), a management narrative report explaining all significant
variances from forecasts and all significant current developments in staffing,
marketing, sales and operations;
(vi) promptly following receipt by the Company, each audit
response letter, accountant's management letter and other written report
submitted to the Company by its independent public accountants in connection
with an annual or interim audit of the books of the Company or any of its
Subsidiaries; and
(vii) promptly, from time to time, such other information
regarding the business, financial condition, operations, property or affairs of
the Company and its Subsidiaries as such Major Shareholder reasonably may
request.
(b) Reserve for Conversion Shares. The Company shall at all times
reserve and keep available out of its authorized but unissued shares of Common
Stock, for the purpose of effecting the conversion of the Series H, Series I and
Series J Preferred (including all of the Series H Preferred issuable upon
exchange of the Exchangeable Shares) and the Exchangeable Shares exchangeable
only for Common Stock from time to time outstanding, such number of its duly
authorized shares of Common Stock as shall be sufficient to effect the
conversion of such shares. If at any time the number of authorized but unissued
shares of Common Stock shall not be sufficient to effect the conversion of such
shares, the Company will forthwith take such corporate action as may be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes; provided, however,
that nothing in this Section 11(b) shall supersede Sections 10(c)(vi) above, and
the Company shall not issue any shares of Common Stock if, after giving effect
thereto, there would not be a sufficient amount of authorized but unissued
Common Stock necessary to affect the conversion of the Series H, Series I and
Series J Preferred (including all of the Series H Preferred issuable upon
exchange of the Exchangeable Shares) and the Exchangeable Shares exchangeable
only for Common Stock as of such time of issuance. The Company will use all
reasonable best efforts to obtain any authorization, consent, approval or other
action by or make any filing with any court or administrative body that may be
required under applicable state securities laws in connection with the issuance
of shares of Common Stock upon conversion of the Series H, Series I and Series J
Preferred (including all of the Series H Preferred issuable upon exchange of the
Exchangeable Shares) and the Exchangeable Shares exchangeable only for Common
Stock.
(c) Properties, Business and Insurance. The Company shall maintain and
cause each of its Subsidiaries to maintain as to their respective properties and
business, with financially sound and reputable insurers, insurance against such
casualties and contingencies and of such types and in such amounts as it, in the
Company's best judgment after due injury, customary for companies similarly
situated, which insurance shall be deemed by the Company to be sufficient. The
Company shall not cause or permit any assignment or change in beneficiary and
shall not borrow against any such policies. If requested by Major Shareholders
holding at least a majority of the outstanding Series H Preferred (including the
holders of Exchangeable Shares on an as-converted basis), Series I Preferred and
Series J Preferred, the Company will add one designee of such Major Shareholders
as a notice party for each such policy and shall request that the issuer of each
policy provide such designee with ten days' notice before such policy is
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terminated (for failure to pay premiums or otherwise) or assigned or before any
change is made in the beneficiary thereof.
(d) Directors and Officers Insurance. At such time as the Board
determines that it is in the best interests of the Company to obtain directors
and officers insurance, the Company will use its best efforts to obtain and
maintain in good standing comprehensive directors and officers insurance for the
directors and officers of the Company.
(e) Inspection and Consultation. The Company shall permit and cause
each of its Subsidiaries to permit each Major Shareholder and such Persons as it
may designate, provided that such Persons sign the Company's standard
confidentiality agreement, at such Major Shareholder's expense, to visit and
inspect any of the properties of the Company and its Subsidiaries, examine their
books and take copies and extracts therefrom, discuss the affairs, finances and
accounts of the Company and its Subsidiaries with their officers, employees and
public accountants (and the Company hereby authorizes said accountants to
discuss with such Major Shareholder and such designees such affairs, finances
and accounts) and consult with the management of the Company and its
Subsidiaries as to their affairs, finances and accounts, all at reasonable times
and upon reasonable notice.
(f) Restrictive Agreements Prohibited. Neither the Company nor any of
its Subsidiaries shall become a party to any agreement which by its terms
restricts the Company's performance of this Agreement, the Combination Agreement
(including all agreements and instruments entered into by the Company pursuant
thereto), the Series I Purchase Agreement, the Series J Purchase Agreement, the
Registration Rights Agreement or the Certificate.
(g) Transactions with Affiliates. Except for transactions contemplated
by this Agreement or as otherwise approved by the Board, neither the Company nor
any of its Subsidiaries shall enter into any transaction with (1) any Person
who, directly or indirectly, owns or controls, is under common ownership or
control with, or is owned or controlled by, the Company, (2) any Person who is a
director, officer or partner or is, directly or indirectly, the beneficial owner
of 10% or more of any class of equity Securities of the Company or a Person
described in clause (1) above, (3) any Person of whom the Company is a partner
or is, directly or indirectly, the beneficial owner of 10% or more of any class
of equity Securities, (4) any Person in whom the Company has a substantial
beneficial interest, or (5) any relative or spouse of any of the foregoing
Persons described in clause (1), (2), (3) or (4) above, except for transactions
on customary terms related to a person's employment with the Company or any of
its Subsidiaries.
(h) Compensation. The compensation to be paid to each future officer of
the Company employed after the date hereof and any change in compensation of any
current officer of the Company shall be recommended by the Compensation
Committee of the Board and approved by a majority of the Directors.
(i) By-laws. The Company shall at all times cause its By-laws to
provide that, unless otherwise required by the laws of the State of Delaware,
(a) any two Directors or (b) any holder or holders of at least 25% of the
outstanding shares of Series H Preferred (including the holders of Exchangeable
Shares on an as-converted basis), Series I Preferred and Series J
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Preferred (voting together as a single class), shall have the right to call a
meeting of the Board or stockholders. The Company shall at all times maintain
provisions in its By-laws and/or Certificate indemnifying all Directors against
liability and absolving all directors from liability to the Company and its
stockholders to the maximum extent permitted under the laws of the State of
Delaware.
(j) Employee Nondisclosure and Developments Agreements. The Company
shall obtain, and shall cause its Subsidiaries to obtain, employee nondisclosure
and developments agreements from all future officers, key employees and other
employees who will have access to confidential information of the Company or any
of its Subsidiaries, upon their employment by the Company or any of its
Subsidiaries.
(k) Maintenance of Ownership of Subsidiaries. Except with the approval
of the Board, the Company shall not sell or otherwise transfer any shares of
capital stock of any Subsidiary, except to the Company or another Subsidiary, or
permit any Subsidiary to issue, sell or otherwise transfer any shares of its
capital stock or the capital stock of any Subsidiary, except to the Company or
another Subsidiary.
(l) Distribution by Subsidiaries. The Company shall not permit any
Subsidiary to purchase or set aside any sums for the purchase of, or pay any
dividend or make any distribution or, any shares of its stock, except for
dividends or other distributions payable to the Company or another Subsidiary.
(m) Compliance with Laws. The Company shall comply, and cause each
Subsidiary to comply, with all applicable laws, rules, regulations and orders,
noncompliance with which could materially adversely affect is business or
condition, financial or otherwise.
(n) Keeping of Records and Books of Account. The Company shall keep,
and cause each Subsidiary to keep, adequate records and books of account, in
which complete entities will be made in accordance with generally accepted
accounting principles consistently applied, reflecting all financial
transactions of the Company and such Subsidiary, and in which, for each fiscal
year, all proper reserves for depreciation, depletion, obsolescence,
amortization, taxes, bad debts and other purposes in connection with its
business shall be made.
(o) U.S. Real Property Interest Statement. Upon a written request by
any Major Shareholder who is, or in whom a partner is, a "foreign person" for
purposes of Section 897 of the Internal Revenue Code, the Company shall provide
such Major Shareholder with a written statement informing the Major Shareholder
whether such Major Shareholder's interest in the Company constitutes a U.S. real
property interest. The Company's determination shall comply with the
requirements of Treasury Regulation Section 1.897-2(h)(1) or any successor
regulation, and the Company shall provide timely notice to the Internal Revenue
Service, in accordance with and to the extent required by Treasury Regulation
Section 1.897-2(h)(2) or any successor regulation, that such statement has been
made. The Company's written statement to any Major Shareholder shall be
delivered to such Major Shareholder within 30 days of such Major Shareholder's
written request therefor.
19
(p) Debt, Etc. The Company shall not, without the approval of the
Board, incur any debt or pledge or grant a security interest in its assets,
other than for working capital purposes in the ordinary course of the Company's
business, or issue any guarantee.
(q) Small Business Investment Act Regulations. Each of the Major
Shareholders agrees to vote its securities in favor of any amendment or action
set forth in Section 6.3 of the Series J Purchase Agreement in order to
effectuate compliance with the Small Business Investment Act of 1958 and the
regulations issued thereunder as set forth in 13 CFR 107 and 121, as amended.
12. Termination. This Agreement, and the respective rights and obligations
of the Major Shareholders, shall terminate on the closing of a Qualified Public
Offering.
13. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been given when delivered personally or
mailed by first class, registered or certified mail, postage prepaid, or if
transmitted by fax or other form of recorded communication tested prior to
transmission to such party, to (i) in the case of notice to a Major Shareholder,
each Major Shareholder at its respective address specified on Schedule A, or to
such other address as the addressee shall have furnished to the other Major
Shareholders hereto in the manner prescribed by this Section 13 or (ii) in the
case of the Company at Xxx Xxxxx Xxxx Xxxxx, Xxxxxx, XX 00000, Attention: Xxxxx
Xxxxxx, Fax: (000)-000-0000.
14. Failure to Deliver Shares. If a Major Shareholder becomes obligated to
sell any Servicesoft Shares to another Major Shareholder under this Agreement
and fails to deliver such Servicesoft Shares in accordance with the terms of
this Agreement (the "Non-delivering Major Shareholder"), such other Major
Shareholder may, at its option, in addition to all other remedies it may have,
send to the Non-delivering Major Shareholder the purchase price for such
Servicesoft Shares as is herein specified. Thereupon, the Company upon written
notice to the Non-delivering Major Shareholder, (a) shall cancel on its books
the certificate or certificates representing the Servicesoft Shares to be sold
and (b) shall issue, in lieu thereof, in the name of such other Major
Shareholder a new certificate or certificates representing such Servicesoft
Shares, and thereupon all of the Non-delivering Major Shareholders' rights in
and to such Servicesoft Shares shall terminate.
15. Specific Performance. The rights of the Major Shareholders under this
Agreement are unique and, accordingly, the Major Shareholders shall, in addition
to such other remedies as may be available to any of them at law or in equity,
have the right to enforce their rights hereunder by actions for specific
performance to the extent permitted by law.
16. Stock Certificate Legends. Each certificate evidencing the Servicesoft
Shares issued on or after the date hereof, and each certificate issued on or
after the date hereof for any such securities issued to subsequent transferees
of any such certificate shall be stamped or otherwise imprinted with a legend in
substantially the following form (in additional to any legend required under
applicable state securities laws):
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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS, AND MAY NOT BE SOLD, TRANSFERRED, OFFERED
FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF WITHOUT
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
UNDER APPLICABLE STATE SECURITIES LAW, UNLESS THE ISSUER SHALL
HAVE RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE ISSUER THAT THE SECURITIES REPRESENTED BY THIS CERTIFICATE
MAY BE LEGALLY SOLD OR DISTRIBUTED PURSUANT TO EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
WITHOUT REGISTRATION UNDER THEN APPLICABLE STATE AND FEDERAL
LAWS.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT
TO CERTAIN RESTRICTION ON TRANSFER CONTAINED IN AN AGREEMENT
BETWEEN THE ISSUER AND THE STOCKHOLDER, COPIES OF WHICH MAY BE
OBTAINED FROM THE ISSUER OR FROM THE HOLDER OF THIS CERTIFICATE.
NO TRANSFER OF SUCH SECURITIES SHALL BE MADE ON THE BOOKS OF THE
ISSUER UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE
TERMS OF SUCH AGREEMENT.
Upon request of a holder of such a certificate, the Company shall
remove the foregoing legends from the certificate or issue to such Holder a new
certificate therefor free of any transfer legend, provided, that the Company
receives either an opinion or a "no-action" letter to the effect that any
transfer by such Holder of the securities evidenced by such certificate shall
not violate the Securities Act and applicable state securities laws, unless any
such transfer legend may be removed pursuant to Rule 144(k), in which case no
such opinion or "no-action" letter shall be required. Notwithstanding the
foregoing, upon request of a holder of such a certificate, the Company shall
remove the second paragraph of the legend from the certificate or issue to such
holder a new certificate therefor free of such second paragraph at any time
after this Agreement and the Registration Rights Agreement have terminated or
the holder of the certificate is no longer subject to the provisions of this
Agreement.
17. Entire Agreement. This Agreement constitutes the entire agreement
among the Major Shareholders with respect to the subject matter hereof with
regard to the Servicesoft Shares (or their predecessor securities) and supersede
all prior agreements and understandings between them or any of them as to such
subject matter including the Amended and Restated Shareholders Agreement.
18. Waivers and Further Agreements. Any of the provisions of this
Agreement may be waived with the written consent of Major Shareholders owning
67% of the Servicesoft Shares then owned by all Major Shareholders (calculated
on an as-converted basis), provided, however, that no Major Shareholder (or
group of Major Shareholders) shall lose their entitlement to representation on
the Board under Section 6(a) as a result of this paragraph without their
consent. Any waiver by any Major Shareholder of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent
breach of that provision or of any other
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provision hereof. Each of the Major Shareholders agrees to execute all such
further instruments and documents and to take all such further action as any
other Major Shareholder may reasonably require in order to give effect to the
terms and purposes of this Agreement and, in particular, each of the Major
Shareholders agrees to exercise the voting rights attached to the Securities of
the Company (or its Subsidiaries) held by it in order to give effect to the
terms and purposes of this Agreement.
19. Amendments. Except as otherwise expressly provided herein, this
Agreement may not be amended except by an instrument in writing executed by
Major Shareholders owning 67% of the Servicesoft Shares then owned by all Major
Shareholders (calculated on an as-converted basis), provided, however, that no
Major Shareholder (or group of Major Shareholders) shall lose their entitlement
to representation on the Board under Section 6(a) as a result of this Section 19
without their consent; provided further, however, that Section 10(b) of this
Agreement may not be amended except by an instrument in writing executed by the
holders of a majority of the Series J Preferred then outstanding; provided
further, however, that any subsequent purchaser of the Series J Preferred may
become party to this Agreement by executing a signature page hereto and shall be
a Major Shareholder for purposes of this Agreement. The Company shall amend
Schedule A to reflect such subsequent purchasers and shall deliver a copy
thereof to the other parties to this Agreement.
20. Assignment; Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the Major Shareholders and their
respective heirs, executors, legal representatives, successors and permitted
transferees, except as may be expressly provided otherwise herein.
21. Severability. In case any one or more of the provisions contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement and such invalid, illegal
and unenforceable provision shall be reformed and construed so that it will be
valid, legal, and enforceable to the maximum extent permitted by law.
22. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Facsimile counterpart signatures to this Agreement
shall be acceptable and binding.
23. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of Delaware.
[SIGNATURE PAGE FOLLOWS]
-21-
22
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
"COMPANY" SERVICESOFT TECHNOLOGIES, INC.
By: /s/ Xxxxx Xxxxxx
------------------
Xxxxx Xxxxxx
President and Chief Executive Officer
"MAJOR SHAREHOLDERS"
/s/ Xxx Xxxxxxx
------------------------
XXX XXXXXXX
/s/ Xxxxxxxxx X. Xxxxx
------------------------
XXXXXXXXX X. XXXXX
AMERICAN FARM INVESTMENT CORPORATION
By:
Name:
Its:
/s/ Xxxxxxx X. Bogoroch
------------------------
XXXXXXX X. BOGOROCH
CIBC WMV INC.
By: /s/ X. Xxxxxxxxx
--------------------
Name: X. Xxxxxxxxx
Its: Managing Director
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
23
ELRON ELECTRONICS INDUSTRIES LTD.
By: /s/ Illegible
--------------------
Name:
Its:
FINANCIAL TECHNOLOGIES VENTURES L.P
By: /s/ Initials
--------------------
Name: Xxxxx Xx
Its: Managing Member
FINANCIAL TECHNOLOGIES VENTURES (Q) L.P.
By: /s/ Initials
--------------------
Name: Xxxxx Xx
Its: Managing Member
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
24
GEMINI XXXXXX XX L.P.
By: /s/ Illegible
--------------------
Name:
Its:
GEMINI XXXXXX XX PARALLEL FUND L.P.
By: /s/ Illegible
--------------------
Name:
Its:
ADVENT PGGM GEMINI L.P.
By: /s/ Illegible
--------------------
Name:
Its:
GEMINI PARTNER INVESTORS L.P.
By: /s/ Illegible
--------------------
Name:
Its:
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
25
/s/ Xxxx Xxxxx
------------------------
XXXX XXXXX, IN TRUST
GREY ADVERTISING LTD.
By: /s/ Illegible
--------------------
Name:
Its:
INTERNET CAPITAL GROUP, INC.
By: /s/ C. Greendale
--------------------
Name: C. Greendale
Its: M. Director
INTEL CORPORATION
By:
Name:
Its:
X.X. XXXXXXXX XX VENTURE FUND
By: /s/ Xxxx Xxxxxxxx
--------------------
Name: Xxxx Xxxxxxxx
Its:
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
26
LRJ TECHNOLOGIES INC.
By:
Name:
Its:
NETMANAGE INC.
By: /s/ Z. Alon
--------------------
Name: Xxx Xxxx
Its: Chairman and CEO
XXXXX XX, L.P.
By: Xxxxx XX Partners, L.P.
Its: General Partner
By: Orien Ventures Partners, L.P.
Its: General Partner
By: /s/ Xxxxxx X. Xxxxx
--------------------
Name: Xxxxxx X. Xxxxx
Its: Managing General Partner
SAMJANK INC.
By: /s/ Xxxxxxxxxxx Xxxxx
--------------------
Name: Xxxxxxxxxxx Xxxxx
Its:
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
27
/s/ Xxxxxx Xxxxx
------------------------------
XXXXXX XXXXX
SIGMA PARTNERS IV, L.P.
By: Sigma Management, IV, L.L.C.
Its: General Partner
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxx Xxxxxxx
Its: Managing Director
SIGMA ASSOCIATES IV, L.P.
By: Sigma Management IV, L.L.C.
Its: General Partner
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxx Xxxxxxx
Its: Managing Director
SIGMA INVESTORS IV, L.L.C.
By: Sigma Management IV, L.L.C.
Its:
By: /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxx Xxxxxxx
Its: Managing Director
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
28
SIGMA PARTNERS IV, L.P.
By: Sigma Management, IV, L.L.C.
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Its:
SIGMA ASSOCIATES IV, L.P.
By: Sigma Management IV, L.L.C.
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Its:
SIGMA INVESTORS IV, L.L.C.
By: Sigma Management IV, L.L.C.
Its:
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxx
Its:
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
29
SIGMA PARTNERS V, L.P.
By: Sigma Management, IV, L.L.C.
Its: General Partner
By: /s/ X. Xxxx
---------------------------
Name: Xxxxxxxx X. Xxxx
Its: Managing Director
SIGMA ASSOCIATES V, L.P.
By: Sigma Management V, L.L.C.
Its: General Partner
By: /s/ X. Xxxx
---------------------------
Name: Xxxxxxxx X. Xxxx
Its: Managing Director
SIGMA INVESTORS V, L.L.C.
By: Sigma Management IV, L.L.C.
Its:
By: /s/ X. Xxxx
---------------------------
Name: Xxxxxxxx X. Xxxx
Its: Managing Director
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
30
SOFINOV, SOCIETE FINANCIERE D'INNOVATION
INC., FILIALE DE XX XXXXXX DE DEPOT ET
PLACEMENTS DU QUEBEC
By: /s/ Illegible
---------------------------
Name:
Its:
31
/s/ F. Xxxx X'Xxxxxxx
---------------------------
XXXX X'XXXXXXX
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
32
THE XXXXXXX XXXXX GROUP, INC.
By: /s/ Illegible
-------------------------------
Name:
Its:
STONE STREET FUND 2000, LLC
By: /s/ Xxxxxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxxxxx X. Xxxxxxxxxx
Its: Vice President
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
33
XXXXXX XXXXXXX XXXX
XXXXXX EQUITY FUNDING, INC.
(Print name of shareholder)
By: /s/ Xxxxx Xxxxxx
------------------------------
Name: Xxxxx Xxxxxx
Its: Vice President
ITOCHU TECHNO-SCIENCE
CORPORATION
(Print name of shareholder)
By: X. Xxxxxx
------------------------------
Name: X. Xxxxxx
Its: President
ITOCHU TECHNOLOGY, INC.
------------------------------
(Print name of shareholder)
By: /s/ Takahiro Susaki
---------------------------
Name: Takahiro Susaki
Its: President
ITOCHU CORPORATION
------------------------------
(Print name of shareholder)
By: /s/ Xxxx Xxxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxxx
Its: Chief Operating Officer, Information
Technology and Telecommunications Division
34
Xxx Xxxxxxx
--------------------------
(Print name of shareholder)
By: /s/ Xxx Xxxxxxx
--------------------------
Name: MD Servicesoft EMEA
Its:
THE REEZ TRUST
(Print name of shareholder)
By: /S/ Illegible
--------------------------
Name:
Its:
XXXXXX X. XXXXXX
(Print name of shareholder)
By: /s/ Xxxxxx X. Xxxxxx
---------------------
Name: Xxxxxx X. Xxxxxx
Its:
XX XXXXXXXX
--------------------------
(Print name of shareholder)
By: /s/ X. Xxxxxxxx
--------------------------
Name: Xx Xxxxxxxx
Its:
XXXXXX XXXXXXXX
(Print name of shareholder)
By: /s/ Xxxxxx Xxxxxxxx
--------------------------
Name: Xxxxxx Xxxxxxxx
Its:
35
Xxxxxxx Xxxxxxxxx
------------------------------------------
(Print name of shareholder)
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Its:
XXXX XXXXXXX
------------------------------------------
(Print name of shareholder)
By: /s/ Xxxx Xxxxxxx
----------------------------------------
Name:
Its:
XXXX XXXXXXX
------------------------------------------
(Print name of shareholder)
By: /s/ Xxxx X. Xxxxxxx
----------------------------------------
Name:
Its:
XXXX XXXXXXX
------------------------------------------
(Print name of shareholder)
By: /s/ X. Xxxxxxx
----------------------------------------
Name:
Its:
36
XXX XXXXXX
------------------------------------------
(Print name of shareholder)
By: /s/ Xxx Xxxxxx
----------------------------------------
Name:
Its: SVP, Strategic Alliances
XXXX XXXXXXX
------------------------------------------
(Print name of shareholder)
By: /s/ Xxxx Xxxxxxx
----------------------------------------
Name:
Its:
/s/ Initials
XXXX XXXXXXXXX
[SIGNATURE PAGE TO SECOND AMENDED SHAREHOLDERS AGREEMENT]
37
SCHEDULE A
MAJOR SHAREHOLDERS
MAJOR SHAREHOLDERS EXCHANGEABLE EXCHANGEABLE SERIES H SERIES I SERIES J
COMMON PREFERRED PREFERRED PREFERRED PREFERRED
Xxxxxxxxx X. Xxxxx 528,426 30,488 103,211
c/o Xxx Xxxxxx
Venad Administrative Services, Inc.
000 Xxxxxxx Xxxxxx, #000
Xxx Xxxx, XX 00000
Fax: 000-000-0000
American Farm Investment Corporation 98,518
BCE Place, 000 Xxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attn: Xxxxx Xxxxxxxx
Fax: 000-000-0000
Xxxxxxx X. Bogoroch 17,315 9,756 4,651
00 Xxxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxx, X0X 0X0
Fax: 000-000-0000
CIBC WMV Inc. 1,219,512 350,831
000 Xxx Xxxxxx, 0xx Xxxxx
BCE Place
Toronto, Ontario M5J 2F8
Attn: Xxxxx Xxxxxxxxx
Fax: 000-000-0000
Elron Electronics Industries Ltd. 804,653
X.X. Xxx 0000
Xxxxx, Xxxxxx 00000
Attn: Xxxxx Xxxxxx
Fax: 000-0-000-0000
38
Financial Technologies Ventures, L.P. 33,659 280,731
Financial Technologies Ventures (Q), L.P. 941,951 (aggregate)
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxx Xx
Fax: 000-000-0000
Gemini Xxxxxx XX L.P. 226,820 193,804 121,703
Advent PGGM Gemini L.P. 306,207* 29,071 18,256
Gemini Xxxxxx XX Parallel Fund L.P. 34,023* 261,637 164,299
Gemini Partner Investors L.P. 3,293 2,165
c/o Gemini Capital Fund
Management Ltd.
00 Xxxxxxxx Xxxxxxx Xxxxxx
P.O. Box 12548
Industrial Xxxx
Xxxxxxxx 00000 Xxxxxx
Attn: Xxxx Xxxx
Fax: 000-000-0-000-0000
Xxxx Xxxxx, in trust 24,390
c/x Xxxxx & Associates
000 Xxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxx X0X 0XX
Fax: 000-000-0000
Grey Advertising Ltd. 141,759 20,889
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx X0X 0X0
Attn: Xxxx Xxxxxxx
Fax: 000-000-0000
Intel Corporation 840,329
0000 Xxxxxxx Xxxxxxx Xxxxxxxxx 63,025(1)
#XX0-000
Xxxxx Xxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxxxx
Fax: 000-000-0000
Internet Capital Group, Inc. 630,247 92,868 208,084
00 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
Fax: 000-000-0000
X.X. Xxxxxxxx XX Venture Fund, L.P. 708,808 104,445 147,287
Canada Trust Tower
BCE Place, Suite 440
000 Xxx Xxxxxx
Xxxxxxx, Xxxxxxx,
XXXXXX X0X 0X0
Attn: Xxxx Xxxxxxxx
Fax: 000-000-0000
--------
*Represents options exerciseable for Exchangeable Preferred Shares of Balisoft
Ltd. which are exchangeable for Exchangeable Preferred.
1 Represents warrants to purchase Series H Preferred Stock.
39
Xxxxxx X. Xxxxx 12,238 9,976
Xxx Xxxx Xxxx
Xxxxxxxxx, XX 00000
Fax: 000-000-0000
LRJ Technologies Inc. 1,206,753(2) 56,710
c/o Brightspark
00 Xxxxxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Attn: Xxxx Xxxxxxxxx
Fax: 000-000-0000
NetManage Inc. 269,038
00000 X. Xx Xxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxx Xxxx
Fax: 000-000-0000
Xxxxx XX, L.P. 778,640
c/o Orien Ventures, Inc.
Xxx Xxxx Xxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxx
Fax: 000-000-0000
Xxxxxx Xxxxx 2,439
c/x Xxxxxxxxx Xxxxxxxx Evergreen Ltd.
00 Xxxxxxxxxx Xxxx.
00000 Xxx-Xxxx Xxxxxx
Fax: 000-0000-000-0000
Sigma Partners V, L.P. 385,271
Sigma Partners IV, L.P. 649,555 85,666
Sigma Associates IV, L.P. 169,697 34,732
Sigma Investors IV, L.P. 21,078 3,427
00 Xxxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxxxxx, XX 00000
Attn: Xxx Xxxxxx
Fax: 000-000-0000
Sofinov, Societe Financiere D'Innovation Inc., 708,808 853,659 449,502
Filiale de la Caisse de Depot et Placements du
Xxxxxx
0000xxxxxx, XxXxxx Xxxxxxx, 0xx Xxxxx
Xxxxxxxx, Xxxxxx X0X 0X0
Attn: Sophie Forest
Fax: 000-000-0000
Samjank Inc. 97,319 16,833
c/o I.L.S. (Corporate Services) Ltd.
Second Floor, Xxxxxxxx Xxxxx
Xxxxxxxx Xxxx
Xxxxxxx, 0X0 0X0 Xxxx xx Xxx
Fax: 00-000-000-0000
--------
2 Exchanged into Common Stock of the Company.
40
Xxx Xxxxxxx 97,318 16,833
XX Xxx 000
Xxxxxx Xxxx
4486 Israel
Xxxx Xxxxxxxxx 27,685
c/o Brightspark
00 Xxxxxxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
Fax: 000-000-0000
Xxxxxx Xxxxxxx 110,742
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Fax: 000-000-0000
Xxxx X'Xxxxxxx 11,074
00 Xxxxxxx Xxxx
Xxxxxxxx Xxxx, XX 00000
The Xxxxxxx Xxxxx Group, Inc. 664,452
Stone Street Fund 2000, LLC 110,742
Xxxxxxx Xxxxx
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
FAX: 000-000-0000
Xxx Xxxxxx 16,661
00 Xxxxxxxxx Xxxxx #0X
Xxx Xxxx, XX 00000
Washington Mall Partners 7,420
c/o Xxxx Xxxx
000 Xxxxxx Xx., 0X
Xxxxxx, XX 00000
ITOCHU Techno-Science Corporation 44,297
ITOCHU Corporation 44,297
ITOCHU Technology, Inc. 22,148
0000 Xxxxxxx Xxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxxx
Fax: 000-000-0000
Xxxxx Xxxxxx 55,371
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xx Xxxxxxxx 5,537
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
41
Fax: (000) 000-0000
Xxxxxx Xxxxxxxx 16,611
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxxxxxx Xxxxxxxxx 22,148
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxxx Xxxxxxx 2,769
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxx Xxxxxxx 9,967
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxxx Xxxxxxx 5,537
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxxx Xxxxxxx 5,537
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxx Xxxxxx 9,967
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Xxxx Xxxxxxx 5,537
c/o Servicesoft Technologies, Inc.
Xxx Xxxxx Xxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
The Reez Trust 9,967
c/o Kaplan Talkins
0000 Xxxx Xxxxxx
Xxxxx 0X
Xxxxxxx, Xxxxxxx X0X 0X0
XXXXXX
42
SCHEDULE B
PREFERENCE AMOUNTS
Securities Previously owned by Series H Preferred Holder Individual Preference Amounts
Series F Convertible Stock of the Company $5,230,654
Series G Convertible Stock of the Company $5,925,000
Preferred Shares of Balisoft Technologies Inc. $8,047,532
Total Preference Amount $19,203,186
