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EXHIBIT 4.2
FORM OF SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (the "Agreement"), dated as of September 5,
2000, by and among Starbase Corporation, a Delaware corporation, with
headquarters located at 0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxx Xxx, Xxxxxxxxxx
(the "Company"), and the investors listed on the Schedule of Buyers attached
hereto (individually, a "Buyer" and collectively, the "Buyers").
WHEREAS:
A. The Company and the Buyers are executing and delivering this Agreement
in reliance upon the exemption from securities registration afforded by Rule 506
of Regulation D ("Regulation D") as promulgated by the United States Securities
and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "1933 Act");
B. The Buyers wish to purchase, upon the terms and conditions stated in
this Agreement, up to an aggregate of $17.5 million of the Company's Common
Stock, $.01 par value per share (the "Common Stock") in the respective amounts
set forth opposite each Buyer's name on the Schedule of Buyers; and to receive
in consideration for such purchase, the Warrants to purchase shares of Common
Stock in the respective amounts set forth opposite each Buyer's name in the
Schedule of Buyers, subject to adjustment as provided in the Warrants; and
C. The Company shall authorize as of the Closing the issuance of Common
Stock Purchase Warrants to the Buyers (the "Warrants"), each in the form
attached hereto as Exhibit A, to acquire shares of Common Stock (such shares of
Common Stock issued upon exercise of the Warrants are hereinafter referred to as
the "Warrant Shares", and together with the Common Shares (as defined in Section
1a.) and the Warrants, the "Securities");
D. Contemporaneously with the execution and delivery of this Agreement, the
parties hereto are executing and delivering a Registration Rights Agreement in
the form attached hereto as Exhibit B (the "Registration Rights Agreement")
pursuant to which the Company has agreed to provide certain registration rights
under the 1933 Act and the rules and regulations promulgated thereunder, and
applicable state securities laws.
NOW, THEREFORE, the Company and the Buyers hereby agree as follows:
1. PURCHASE AND SALE OF COMMON STOCK AND WARRANTS.
a. Purchase of Common Stock. Subject to the satisfaction (or waiver) of
the conditions set forth in Sections 6 and 7 below, the Company shall issue and
sell to the Buyers and the Buyers shall purchase from the Company an aggregate
of 3,211,009 shares of Common Stock (the "Common Shares"), in the respective
amounts set forth opposite each Buyer's name on the Schedule of Buyers (the
"Closing"). The per share purchase price (the "Purchase Price") of the Common
Shares shall be $5.45 or an aggregate purchase price of $17.5 million. On the
Closing Date (as defined below) the Company shall deliver to each Buyer a stock
certificate(s) representing such number of Common Shares which such Buyer is
then purchasing (as indicated opposite such Buyer's name on the Schedule of
Buyers), duly executed on behalf of the Company and registered in the name of
such Buyer or its designee (the "Stock Certificates").
b. Closing Date. The date and time of the Closing (the "Closing Date")
shall be 10:00 a.m. Eastern Time on September 5, 2000, subject to notification
of satisfaction (or waiver) of the conditions to the Closing set forth in
Sections 6 and 7 below (or such later date as is mutually agreed to by the
Company and the Buyers). The Closing shall occur on the Closing Date at the
offices of Xxxxxxx Xxxx & Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
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c. Form of Payment. On the Closing Date, each Buyer shall pay the
Company the Purchase Price for the Common Shares to be issued and sold to such
Buyer at the Closing, by wire transfer of immediately available funds in
accordance with the Company's written wire instructions provided in writing to
the Buyers at least two days prior to the Closing Date.
d. Warrants. In consideration of the purchase of the Common Shares, the
Company shall on the Closing Date issue and deliver to each Buyer, Warrants to
purchase in the aggregate six hundred and forty-two thousand, two hundred and
one (642,201) additional shares of Common Stock in the respective amounts set
forth opposite each Buyer's name on the Schedule of Buyers.
2. BUYER'S REPRESENTATIONS AND WARRANTIES.
Each Buyer represents and warrants with respect to only itself that:
a. Investment Purpose. Such Buyer (i) is purchasing the Common Shares
and the Warrants and (ii) upon exercise of the Warrants, will acquire the
Warrant Shares, then issuable for its own account for investment only and not
with a present view towards, or for resale in connection with, the public sale
or distribution thereof, except pursuant to sales registered or exempted under
the 1933 Act; provided, however, that by making the representations herein, such
Buyer does not agree to hold any Securities for any minimum or other specific
term and reserves the right to dispose of the Securities at any time in
accordance with or pursuant to a registration statement or an exemption under
the 1933 Act.
b. Accredited Investor Status. Such Buyer is an "accredited investor" as
that term is defined in Rule 501(a) of Regulation D.
c. Reliance on Exemptions. Such Buyer understands and acknowledges that
the Common Shares and Warrants are being offered and sold to it in reliance on
specific exemptions from the registration requirements of United States federal
and state securities laws and that the Company is relying in part upon the truth
and accuracy of, and such Buyer's compliance with, the representations,
warranties, agreements, acknowledgments and understandings of such Buyer set
forth herein in order to determine the availability of such exemptions and the
eligibility of such Buyer to acquire the Common Shares and the Warrants.
d. Information. Such Buyer and its advisors, if any, have been furnished
with all materials relating to the business, finances and operations of the
Company and materials relating to the offer and sale of the Common Shares and
the Warrants which have been specifically requested by such Buyer. Such Buyer
and its advisors, if any, have been afforded the opportunity to ask questions of
the Company. Neither such inquiries nor any other due diligence investigations
conducted by such Buyer or its advisors, if any, or its representatives shall
modify, amend or affect such Buyer's right to rely on the Company's
representations and warranties contained in Section 3 below.
e. No Governmental Review. Such Buyer understands and acknowledges that
no United States federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Common
Shares and the Warrants or the fairness or suitability of the investment in the
Securities nor have such authorities passed upon or endorsed the merits of the
offering of the Common Shares and the Warrants.
f. Transfer or Resale. Such Buyer understands and agrees that except as
provided in the Registration Rights Agreement: (i) Securities have not been and
are not being registered under the 1933 Act or any state securities laws, and
may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered thereunder, (B) such Buyer shall have delivered to the
Company an opinion of counsel, in a form reasonably acceptable to the Company,
to the effect that such Securities to be sold, assigned or transferred may be
sold, assigned or transferred pursuant to an exemption from such registration,
or (C) such securities can be sold, assigned or transferred pursuant to Rule 144
promulgated under the 1933 Act (or a successor rule thereto) ("Rule 144"); (ii)
any sale of such securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144 and further, if Rule 144 is not
applicable, any resale of such securities under circumstances in which the
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seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the 0000 Xxx) may require compliance
with some other exemption under the 1933 Act or the rules and regulations of the
SEC thereunder; and (iii) neither the Company nor any other person is under any
obligation to register such securities under the 1933 Act or any state
securities laws or to comply with the terms and conditions of any exemption
thereunder.
g. Legends. Such Buyer understands and agrees that the certificates or
other instruments representing the Common Shares and the Warrants, and, until
such time as the Common Shares and the Warrant Shares have been registered under
the 1933 Act as contemplated by the Registration Rights Agreement, the stock
certificates representing the Common Shares and the Warrant Shares, except as
set forth below, shall bear a restrictive legend in substantially the following
form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN
APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.
The legend set forth above shall be removed and the Company shall issue
a certificate without such legend to the holder of any Securities upon which it
is stamped, if (i) any such Securities are registered for sale under the 1933
Act, (ii) in connection with a sale transaction, such holder provides the
Company with an opinion of counsel, in a form reasonably acceptable to the
Company, to the effect that a public sale, assignment or transfer of such
Securities may be made without registration under the 1933 Act, or (iii) any of
the Securities can be sold pursuant to Rule 144 without any restriction as to
the number of securities acquired as of a particular date that can then be
immediately sold. Each Buyer acknowledges, covenants and agrees to sell any of
the Securities represented by a certificate(s) from which the legend has been
removed, only pursuant to (i) a registration statement effective under the 1933
Act, or (ii) advice of counsel that such sale is exempt from registration
required by Section 5 of the 1933 Act. In the event the above legend is removed
from any of the Securities, the Company may, upon reasonable advance notice to
the holder, require that the above legend be placed on any of the Securities
that cannot then be sold pursuant to an effective registration statement or Rule
144(k) under the 1933 Act (or any successor rule thereto).
h. Authorization; Enforcement. This Agreement has been duly and validly
authorized, executed and delivered on behalf of such Buyer and is a valid and
binding agreement of such Buyer enforceable in accordance with its terms,
subject as to enforceability to general principles of equity and to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other
similar laws relating to, or affecting generally, the enforcement of applicable
creditors' rights and remedies.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each of the Buyers that:
a. Organization and Qualification. The Company and the Subsidiaries (a
complete list of which is set forth in Schedule 3(a) (the "SUBSIDIARIES")) are
corporations duly organized and validly existing in good standing under the laws
of the jurisdiction in which they are incorporated, and have the requisite
corporate power to own their properties and to carry on their business as now
being conducted. Each of the Company and the Subsidiaries is duly qualified as a
foreign corporation to do business and is in good standing in every jurisdiction
in which the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing would not have a Material Adverse Effect. "Material Adverse
Effect" means any material adverse effect on (i) the business, properties,
operations, financial condition or results of operations of the Company and the
Subsidiaries, taken as a whole, or (ii) on the ability of the Company to perform
its obligations hereunder, under the Registration Rights Agreement and the
Warrants.
b. Authorization; Enforcement; Compliance with Other Instruments. (i)
The Company has the requisite corporate power and authority to enter into and
perform its obligations under this
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Agreement and the Registration Rights Agreement, to issue, sell and perform its
obligations with respect to the Common Shares and the Warrants in accordance
with the terms hereof and thereof, and to issue the Warrant Shares upon the
exercise of the Warrants, in accordance with the Warrants, (ii) the execution
and delivery of this Agreement, the Common Shares, the Warrants and the
Registration Rights Agreement by the Company and the consummation by it of the
transactions contemplated hereby and thereby, including, without limitation, the
issuance of the Common Shares and the Warrants and the reservation for issuance
and the issuance of the Warrant Shares upon exercise of the Warrants have been
duly authorized by the Company's Board of Directors and no further consent or
authorization is required by the Company, its Board of Directors or its
stockholders, (iii) this Agreement, the Registration Rights Agreement, the
certificates for the Common Shares and the Warrants have been duly executed and
delivered by the Company, and (iv) this Agreement, the Registration Rights
Agreement, the certificates for the Common Shares and the Warrants constitute
the valid and binding obligations of the Company enforceable against the Company
in accordance with their terms, except as such enforceability may be limited by
general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally, the enforcement of creditors' rights and remedies.
c. Capitalization and Indebtedness. As of the date hereof and
immediately prior to the issuance of the Common Shares and Warrants hereunder,
the authorized capital stock of the Company consists of 80,000,000 shares of
Common Stock, of which as of September 5, 2000, 46,980,246 shares are issued and
outstanding, and 10,000,000 shares of Preferred Stock, of which as of the date
hereof no shares are issued or outstanding. All of the outstanding shares have
been validly issued and are fully paid and nonassessable. No shares of Common
Stock or Preferred Stock are subject to preemptive rights or any other similar
rights or any liens or encumbrances suffered or permitted by the Company. Except
as set forth on Schedule 3(c) or the SEC Documents, as of the date hereof, (i)
there are no outstanding options, warrants, scrip, rights to subscribe to, calls
or commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any of the
Subsidiaries, or contracts, commitments, understandings or arrangements by which
the Company or any of the Subsidiaries is or may become bound to issue
additional shares of capital stock of the Company or any of the Subsidiaries,
(ii) there are no outstanding debt securities, notes, credit agreements, or
other agreements, documents or instruments evidencing indebtedness of the
Company or any of the Subsidiaries or by which the Company or any of the
Subsidiaries is or may become bound and (iii) there are no agreements or
arrangements under which the Company or any of the Subsidiaries is obligated to
register the sale of any of their securities under the 1933 Act (except the
Registration Rights Agreement). There are no securities or instruments
containing anti-dilution or similar provisions that will be triggered by the
issuance of any of the Securities as described in this Agreement. The Company
has furnished to the Buyer true and correct copies of the Company's Certificate
of Incorporation, as amended and as in effect on the date hereof (the
"Certificate of Incorporation"), and the Company's By-laws, as in effect on the
date hereof (the "By-laws").
d. Issuance of Securities. The Securities are duly authorized and, upon
issuance in accordance with the terms hereof, the Common Shares and the Warrants
shall be (i) validly issued (in the case of the Common Shares and Warrants),
fully paid and non-assessable (in the case of the Common Shares), (ii) free from
all taxes, liens and charges with respect to the issue thereof, and shall not be
subject to preemptive rights or other similar rights of stockholders of the
Company and (iii) entitled to the rights set forth in the Certificate of
Incorporation and the Warrants, as the case may be. Not less than 100% of the
number of shares of Common Stock necessary to provide for the issuance of the
Warrant Shares have been duly authorized and reserved for issuance upon exercise
of the Warrants. Upon exercise of the Warrants, the Warrant Shares will be
validly issued, fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issue thereof, with the holders being entitled to
all rights accorded to a holder of Common Stock.
e. No Conflicts. The execution, delivery and performance of this
Agreement, the Registration Rights Agreement and the Warrants by the Company,
and the consummation by the Company of the transactions contemplated hereby and
thereby (including, without limitation, the issuance of the Securities) will not
(i) result in a violation of the Certificate of Incorporation and the
Certificate of Designations, Preferences and Rights of any outstanding series of
Preferred Stock of the Company or By-laws, or (ii) except as disclosed in
Schedule 3(e), violate or conflict with, or result in a breach of any provision
of, or constitute a default (or an event which with notice or lapse of time or
both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any material agreement, indenture or
instrument to which the Company or any of the Subsidiaries is a party, or result
in a violation of any law, rule, regulation, order, judgment or decree
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(including U.S. federal and state securities laws and regulations and the rules
and regulations of the principal market or exchange on which the Common Stock is
traded or listed) applicable to the Company or any of the Subsidiaries or by
which any property or asset of the Company or any of the Subsidiaries is bound
or affected. Neither the Company nor the Subsidiaries is in violation of any
term of or in default under its Certificate of Incorporation, any Certificate of
Designations, Preferences and Rights of any outstanding series of Preferred
Stock of the Company or By-laws or their organizational charter or by-laws,
respectively, or in violation of any term of or in default under any material
contract, agreement, mortgage, indebtedness, indenture, instrument, judgment,
decree or order or any statute, rule or regulation applicable to the Company or
the Subsidiaries, the violation or default of which would have a Material
Adverse Effect. The business of the Company and the Subsidiaries is not being
conducted in violation of any law, ordinance or regulation of any governmental
entity, the violation of which would have a Material Adverse Effect. Except as
specifically contemplated by this Agreement and as required under the 1933 Act,
the Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental or regulatory or
self-regulatory agency in order for it to execute, deliver or perform any of its
obligations under or contemplated by this Agreement the Registration Rights
Agreement or the Warrants in accordance with the terms hereof or thereof. All
consents, authorizations, orders, filings and registrations which the Company is
required to obtain pursuant to the preceding sentence have been obtained or
effected on or prior to the date hereof. The Company is not in violation of the
listing requirements of the NASDAQ National Market and does not reasonably
anticipate that the Common Stock will be delisted by the NASDAQ National Market
in the foreseeable future. The Company and the Subsidiaries have no actual
knowledge of any facts or circumstances which might give rise to any of the
foregoing.
f. SEC Documents; Financial Statements. Since December 31, 1998 the
Company has filed all reports, schedules, forms, statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements
of the Securities Exchange Act of 1934, as amended (the "1934 Act") (all of the
foregoing filed prior to the date hereof and all exhibits included therein and
financial statements and schedules thereto and documents incorporated by
reference therein being hereinafter referred to as the "SEC Documents"). The
Company (i) has delivered or made available, including via XXXXX, to each Buyer
or its representative true and complete copies of the SEC Documents as each
Buyer or its representative has requested from the Company and (ii) agrees to
deliver or make available to each Buyer or its representative true and complete
copies of any additional SEC Documents, upon request. As of their respective
dates, the SEC Documents complied in all material respects with the requirements
of the 1934 Act and the rules and regulations of the SEC promulgated thereunder
applicable to the SEC Documents, and none of the SEC Documents, at the time they
were filed with the SEC, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. As of their respective dates, the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements
have been prepared in accordance with generally accepted accounting principles,
consistently applied during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto, or (ii) in the case
of unaudited interim statements, to the extent they may exclude footnotes or may
be condensed or summary statements) and fairly present in all material respects
the financial position of the Company as of the dates thereof and the results of
its operations and cash flows for the periods then ended (subject, in the case
of unaudited statements, to normal year-end audit adjustments).
g. Absence of Certain Changes. Except as expressly set forth in Schedule
3(g) since March 31, 2000, there has been no occurrence with respect to the
Company or the Subsidiaries which would constitute a Material Adverse Effect.
The Company has not taken any steps, and does not currently expect to take any
steps, to seek protection pursuant to any bankruptcy law nor does the Company or
the Subsidiaries have any knowledge or reason to believe that its creditors
intend to initiate involuntary bankruptcy proceedings.
h. Absence of Litigation. There is no action, suit, proceeding, inquiry
or investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the Company
or any of the Subsidiaries, threatened against or affecting the Company or the
Subsidiaries or their respective directors or officers, or the Common Stock,
wherein an unfavorable decision, ruling or finding could individually or in the
aggregate have a Material Adverse Effect.
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i. Acknowledgment Regarding Buyers' Purchase of the Securities. The
Company acknowledges and agrees that each of the Buyers is acting solely in the
capacity of arm's length purchaser with respect to this Agreement and the
transactions contemplated hereby. The Company further acknowledges that each
Buyer is not acting as a financial advisor or fiduciary of the Company (or in
any similar capacity) with respect to this Agreement and the transactions
contemplated hereby and any advice given by any of the Buyers or any of their
respective representatives or agents in connection with this Agreement and the
transactions contemplated hereby is merely incidental to such Buyer's purchase
of the Securities. The Company further represents to each Buyer that the
Company's decision to enter into this Agreement has been based solely on the
independent evaluation by the Company and its representatives. The Company has
not provided to any Buyer any nonpublic information that, in the opinion of the
Company, is material to a decision to purchase or sell Common Stock.
j. No General Solicitation. Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of
Regulation D under the 0000 Xxx) in connection with the offer or sale of any of
the Securities offered hereby.
k. No Integrated Offering. Neither the Company, nor any of its
affiliates, nor any person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to
buy any security, under circumstances that would require registration of any of
the Securities under the 1933 Act or cause the offering of any of the Securities
to be integrated with prior offerings by the Company for purposes of the 1933
Act or any applicable shareholder approval provisions, including, without
limitation, under the rules and regulations of the National Association of
Securities Dealers Automated Quotation System ("NASDAQ").
l. Employment Matters; ERISA Matters. The Company and the Subsidiaries
are in compliance with all federal, state, local and foreign laws and
regulations respecting employment and employment practices, terms and conditions
of employment and wages and hours except where failure to be in compliance would
not have a Material Adverse Effect. To the Company's knowledge, there are no
pending investigations involving the Company or any of the Subsidiaries by the
U.S. Department of Labor or any other governmental agency responsible for the
enforcement of such federal, state, local or foreign laws and regulations. There
is no unfair labor practice charge or complaint against the Company or any of
the Subsidiaries pending before the National Labor Relations Board or any
strike, picketing, boycott, dispute, slowdown or stoppage pending or, to the
Company's knowledge, threatened against or involving the Company or any of the
Subsidiaries. Except as set forth on Schedule 3(l), the Company has no employee
benefit plans subject to the Employee Retirement Income Security Act of 1974, as
amended.
m. Intellectual Property Rights. The Company and the Subsidiaries own or
possess the requisite rights or licenses to use all trademarks, trade names,
service marks, service xxxx registrations, service names, patents, patent
rights, copyrights, inventions, licenses, approvals, governmental
authorizations, and trade secrets (collectively "Intellectual Property Rights")
necessary to conduct their respective businesses as now conducted. None of the
Intellectual Property Rights or other intellectual property rights relating to
the StarTeam Server have expired or terminated, or are expected to expire or
terminate in the near future. The Company and the Subsidiaries do not have any
knowledge of any event, fact or circumstance relating to (i) any infringement by
the Company or the Subsidiaries of any trademarks, trade names, service marks,
service xxxx registrations, service names, patents, patent rights, copyrights,
inventions, licenses, approvals, governmental authorizations, trade secrets or
other similar rights of others, or of any such development of similar or
identical trade secrets or technical information by others or (ii) any person or
entity now infringing any Intellectual Property Rights or other similar rights
or any such development of similar or identical trade secrets or technical
information owned or used by the Company or any of the Subsidiaries and, there
is no claim, action or proceeding being made or brought against, or to the
Company's knowledge, being threatened against, the Company or the Subsidiaries
regarding any trademarks, trade names, service marks, service xxxx
registrations, service names, patents, patent rights, copyrights, inventions,
licenses, approvals, governmental authorizations, trade secrets or other similar
rights of others, or of any such development of similar or identical trade
secrets or technical information by others or (iii) any person or entity now
infringing any Intellectual Property Rights or other similar rights or any such
development of similar or identical trade secrets or other infringement; and the
Company and the Subsidiaries are unaware of any facts or circumstances which
might give rise to any of the foregoing. The Company and the Subsidiaries have
taken reasonable security measures to protect the secrecy, confidentiality and
value of all of their Intellectual Property Rights.
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n. Title. The Company and the Subsidiaries do not own any real property
and have good and marketable title to all personal property owned by them which
is material to the business of the Company and the Subsidiaries, in each case
free and clear of all liens, encumbrances and defects except such as are
described in Schedule 3(n) or such as do not materially affect the value of such
property and do not interfere with the use made of such property by the Company
and the Subsidiaries. Any real property and facilities held under lease by the
Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made of such property and buildings by the Company and the
Subsidiaries.
o. Insurance. The Company and each of the Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as is prudent and customary in the businesses in which the
Company and the Subsidiaries are engaged. Neither the Company nor any such
subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not individually or in the aggregate have a
Material Adverse Effect.
p. Regulatory Permits; Compliance. The Company and the Subsidiaries
possess all franchises, grants, authorizations, licenses permits, easements,
consents, certificates, approvals and orders necessary to own, lease and operate
its properties and to conduct their respective businesses as currently being
conducted (collectively, the "Company Permits"), except where the failure to
obtain such Company Permits would not have a Material Adverse Effect. There is
no action pending, or to the knowledge of the Company, threatened regarding the
suspension or cancellation of any of the Company Permits. Neither the Company
nor any of the Subsidiaries is in conflict with, or in default or violation of,
any of the Company Permits, the violation or default of which would have a
Material Adverse Effect. Neither the Company nor any of the Subsidiaries has
received any notification with respect to possible conflicts, defaults, or
violations of applicable laws, the violation, conflict or default of which would
have a Material Adverse Effect.
q. Tax Status. Except as set forth on Schedule 3(q), the Company and
each of the Subsidiaries has made or filed all federal, state and foreign income
and all other material tax returns, reports and declarations required by any
jurisdiction to which it is subject (unless and only to the extent that the
Company and each of the Subsidiaries has set aside on its books provisions
reasonably adequate for the payment of all unpaid and unreported taxes) and has
paid all taxes and other governmental assessments and charges that are material
in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and has set aside on
its books provision reasonably adequate for the payment of all taxes for periods
subsequent to the periods to which such returns, reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction, and the officers of the Company know of no basis
for any such claim. The Company has not executed a waiver with respect to the
statute of limitations relating to the assessment or collection of any foreign,
federal, state or local tax. The Company has not been notified that any of its
tax returns is currently being audited by any taxing authority.
r. Certain Transactions. Except as set forth on Schedule 3(r) and except
for arm's length transactions pursuant to which the Company makes payments in
the ordinary course of business upon terms no less favorable than the Company
could obtain from third parties and other than the grant of stock options
disclosed on Schedule 3(c), none of the officers, directors or employees of the
Company is presently a party to any transaction with the Company (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which any officer, director or any such employee has a substantial interest or
is an officer, director, trustee or partner.
s. S-3 Registration. The Company is currently eligible to register
securities, including the resale of the Common Shares and the Warrant Shares on
a registration statement on Form S-3 under the 1933 Act.
t. Disclosure. All information relating to or concerning the Company or
any of the Subsidiaries set forth in this Agreement is true and correct in all
material respects and the Company has not omitted
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to state any material fact necessary in order to make the statements made herein
or therein, in light of the circumstances under which they were made, not
misleading. No event or circumstance has occurred or information exists with
respect to the Company or any of the Subsidiaries or its or their business,
properties, operations or financial conditions, which, under applicable law,
rule or regulation, requires public disclosure or announcement by the Company
but which has not been so publicly announced or disclosed (assuming for this
purpose that the Company's reports filed under the 1934 Act are being
incorporated into an effective registration statement filed by the Company under
the 1933 Act).
u. Investment Company Status. The Company is not and upon consummation
of the sale of the Securities will not be an "investment company," a company
controlled by an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company" as such terms
are defined in the Investment Company Act of 1940, as amended.
v. Foreign Corrupt Practices. Neither the Company nor any of the
Subsidiaries, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any subsidiary has, in the course of his actions
for, or on behalf of, the Company used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses relating to
political activity; made any direct or indirect unlawful payment to any foreign
or domestic government official or employee from corporate funds; violated or is
in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977;
or made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment to any foreign or domestic government official or employee.
4. COVENANTS AND AGREEMENTS.
a. Form D. The Company agrees to file a Form D with respect to the
Securities as required under Regulation D and to provide a copy thereof to each
Buyer promptly after such filing. The Company shall, on or before the Closing
Date, take such action as the Company shall reasonably determine is necessary to
qualify the Securities for, or obtain exemption for the Securities for, sale to
the Buyers at the Closing pursuant to this Agreement under applicable securities
or "Blue Sky" laws of the states of the United States, and shall provide
evidence of any such action so taken to the Buyers on or prior to the Closing
Date.
b. Reporting Status. Until the earlier of (i) the date as of which the
Investors (as that term is defined in the Registration Rights Agreement) may
sell all of the Common Shares and the Warrant Shares without restriction
pursuant to Rule 144(k) promulgated under the 1933 Act (or successor thereto) or
(ii) the date on which (A) the Investors shall have sold all the Common Shares
and the Warrant Shares and (B) none of the Common Shares and the Warrants are
outstanding (the "Registration Period"), the Company (x) shall timely file all
reports required to be filed with the SEC pursuant to the 1934 Act, and the
Company shall not terminate its status as an issuer required to file reports
under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
would otherwise permit such termination and (y) will use its best efforts and
take all necessary action to maintain its ability and eligibility to register
securities on Form S-3.
c. Use of Proceeds. The Company will use the proceeds from the sale of
the Common Shares and Warrants for working capital and general corporate
purposes and shall not otherwise, directly or indirectly, use such proceeds for
any loan to any other corporation, partnership, enterprise or other person
(except in connection with its direct or indirect subsidiaries or an equity
investment in any such corporation, partnership, enterprise or other person) or
for the repurchase, redemption, or retirement of any capital stock of the
Company.
d. Financial Information. The Company agrees to file all reports,
schedules, forms, statements and other documents required to be filed by it with
the SEC pursuant to the reporting requirements of the 1934 Act. The financial
statements of the Company will be prepared in accordance with United States
generally accepted accounting principles, consistently applied, and will fairly
present in all material respects the consolidated financial position of the
Company and its consolidated subsidiaries and results of their operations and
cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal year-end audit adjustments).
e. Reservation of Shares. The Company shall take all action necessary to
at all times have authorized, and reserved for the purpose of issuance, no less
than 100% of the number of shares of
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Common Stock necessary to provide for the issuance of the Warrant Shares, in
accordance with the terms of this Agreement and the Warrants.
f. Listing. The Company shall promptly secure the listing of the Common
Shares and Warrant Shares upon the NASDAQ National Market ("NASDAQ") (subject to
official notice of issuance) and shall maintain, so long as any Buyer owns any
of the Securities, the listing of all Common Shares and Warrant Shares from time
to time issuable under the terms of this Agreement and the Warrants on each
national securities exchange and automated quotation system, if any, upon which
shares of Common Stock are then listed. The Company shall pay all fees and
expenses in connection with satisfying its obligations under this Section 4(f).
g. Expenses. Each of the Company and the Buyers shall each pay its
respective costs and expenses incurred by such party in connection with the
negotiation, investigation, preparation, execution, delivery and performance of
this Agreement, the Warrants and the Registration Rights Agreement; provided,
that at the Closing as the Buyers may request, the Company shall reimburse the
Buyers for the Buyers' and its reasonable attorneys' fees and expenses incurred
in connection with the preparation of this Agreement, the Warrants and the
Registration Rights Agreement (including their review of the initial
Registration Statement under the Registration Rights Agreement) up to an
aggregate of $50,000. In addition to the foregoing, the Company agrees to pay on
demand all reasonable costs and expenses (including, without limitation,
reasonable fees and expenses of counsel to the Buyers) incurred by the Buyers in
connection with the enforcement of the Buyers' rights and/or the collection of
all amounts due under this Agreement, the Warrants or the Registration Rights
Agreement; provided, that the Buyers prevail in any action, suit or other
proceeding with respect to such enforcement and/or collection.
h. Additional Issuances of Securities.
(i) Right of First Refusal. If at any time on or before the one year
anniversary of the Closing Date, the Company shall desire to issue any Common
Stock or other equity security or any other security convertible, exchangeable
or exercisable for Common Stock (including any debt financing with an equity
component) or any other right to acquire any Common Stock (the "Convertible
Securities") pursuant to Section 4(2) of the 1933 Act or an offering under
Regulation D or Regulation S of the 1933 Act or in any other private placement
(other than (A) pursuant to Company authorized stock option plans, (B) future
equity financing through any public offering, (C) whereby Common Stock or
Convertible Securities are issued to any person or entity which has or is
proposed to have a material business, technology or commercial relationship with
the Company in addition to any equity financing provided by such person or
entity and it is determined by the Board of Directors of the Company that such
equity financing will result in a material business, technology or commercial
relationship with the Company and (D) whereby Common Stock or Convertible
Securities are issued to any person or entity, in an amount not exceeding
$1,000,000 in any one transaction or series of related transactions and not
exceeding $2,000,000 in the aggregate, which has or is proposed to have a
business, technology or commercial relationship with the Company that is not
determined to be material by the Board of Directors of the Company and such
financing results in a business, technology or commercial relationship between
such person or entity and the Company), then the Company shall first comply with
the terms of this Section 4(h).
(ii) Notice Requirements. The Company shall notify, or cause to be
notified, each of the Buyers, by certified mail return receipt requested, not
less than five (5) business days prior to the time the Company intends to
consummate such issuance (the "Issuance Notice"). The Issuance Notice shall set
forth all of the material terms of such proposed issuance.
(iii) Exercise of Right of First Refusal. The right of first refusal
provided for in this Section 4(h) may be exercised by each of the Buyers by
delivery of a written notice to the Company (the "Exercise Notice"), within five
(5) business days following receipt of the Issuance Notice (the "Refusal
Period"). The Exercise Notice shall state that such Buyer agrees to purchase all
or any specified part of the proposed issuance of such Common Stock or
Convertible Securities on terms substantially equal to the terms set forth in
the Issuance Notice.
(iv) Right to Issue Securities. After expiration of the Refusal
Period, if the provisions of this Section 4(h) have been complied with in all
respects by the Company and no Exercise Notice has been given, or if given, the
Buyers have not agreed to purchase all of the securities set forth in the
Issuance Notice,
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the Company shall have the right for sixty (60) calendar days following the
termination of the Refusal Period to issue such securities, or any portion
thereof not being purchased by the Buyers, as the case may be, specified in the
Issuance Notice on the terms described in the Issuance Notice without further
notice to the Buyers, but after such sixty (60) calendar days, no such issuance
may be made without again giving notice to the Buyers and complying with all of
the requirements of this Section 4(h).
i. Disclosure. From and after the date hereof, the Company shall not
disclose nonpublic information to any Buyer, advisors to or representatives of
such Buyer of which the Company has actual knowledge unless prior to disclosure
of such information the Company identifies such information as being nonpublic
information and provides the Buyer, such advisors and representatives of which
the Company has actual knowledge with the opportunity to accept or refuse to
accept such nonpublic information for review.
j. Corporate Existence. So long as any Buyer beneficially owns any
Securities, the Company shall maintain its corporate existence in good standing
under the laws of the jurisdiction in which it is incorporated.
k. Solvency. The Company individually and together with the Subsidiaries
on a consolidated basis (both before and after giving effect to the transactions
contemplated by this Agreement) is solvent (i.e., its assets have a fair market
value in excess of the amount required to pay its probable liabilities on its
existing debts as they become absolute and matured) and currently the Company
has no information that would lead it to reasonably conclude that the Company
would not have, nor does it intend to take any action that would impair, its
ability to pay its debts from time to time incurred in connection therewith as
such debts mature.
l. Insurance. The Company shall maintain liability, casualty and other
insurance (subject to customary deductions and retentions) with responsible
insurance companies against such risk of the types and in the amounts
customarily maintained by companies of comparable size to the Company.
m. No Integration. The Company will not conduct any future offering that
will be integrated with the issuance of the Securities for purposes of the rules
promulgated by the SEC or NASDAQ.
5. TRANSFER AGENT INSTRUCTIONS.
The Company shall issue irrevocable instructions to its transfer agent (in
the form attached hereto as Exhibit C) to issue certificates, or at a Buyer's or
XX Xxxxx Securities Corporation's (the "AGENT") request, to electronically issue
such shares (e.g., through DWAC or DTC), registered in the name of each Buyer or
the Agent or their respective nominee(s), for the Common Shares and the Warrant
Shares, as the case may be, in such amounts as specified from time to time by
each Buyer or the Agent to the Company in accordance with the terms of and upon
exercise of the Warrants (the "Irrevocable Transfer Agent Instructions"). Prior
to an effective registration statement and resale of the Common Shares and the
Warrant Shares under the 1933 Act, such certificates shall bear the restrictive
legend specified in Section 2(g) of this Agreement. The Company warrants that no
instruction with respect to the Securities other than (i) the Irrevocable
Transfer Agent Instructions referred to in first sentence of this paragraph and
(ii) stop transfer instructions to give effect to Section 2(f) hereof (in the
case of the Common Shares and the Warrant Shares, prior to an effective
registration statement and resale of the Common Shares and the Warrant Shares
under the 1933 Act or as may be required by applicable law), will be given by
the Company to its transfer agent and that the Securities shall otherwise be
freely transferable on the books and records of the Company as and to the extent
provided in this Agreement, the Registration Rights Agreement and the Warrants,
as applicable. Nothing in this Section 5 shall affect in any way each Buyer's
and the Agent's obligations and agreement to comply with all applicable
securities laws upon resale of any of the Securities. If a Buyer or the Agent
provides the Company with an opinion of counsel (such counsel to be reasonably
satisfactory to the Company), in form, substance and scope reasonably
satisfactory to the Company, that registration of a resale by such Buyer or the
Agent of any of the Securities is not required under the 1933 Act, the Company
shall permit the transfer, and, in the case of the Common Shares, or Warrant
Shares, promptly instruct its transfer agent to issue one or more certificates
in such name and in such denominations as specified by such Buyer or the Agent.
The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Buyers and/or the Agent by vitiating the intent
and purpose of the transaction contemplated hereby. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this
Section 5 will be inadequate and agrees, in the event of a
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breach by the Company of the provisions of this Section 5, that the Buyers
and/or the Agent shall be entitled, in addition to all other available remedies,
to an injunction restraining any breach and requiring immediate issuance and
transfer, without the necessity of showing economic loss and without any bond or
other security being required.
6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
The obligation of the Company hereunder to issue and sell the Common Shares
and Warrants to each Buyer at the Closing is subject to the satisfaction, with
respect to each Buyer, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for the Company's sole benefit
and may be waived by the Company at any time in its sole discretion:
a. Such Buyer shall have executed this Agreement and the Registration
Rights Agreement and delivered the same to the Company.
b. Such Buyer shall have delivered to the Company the purchase price for
the Common Shares being purchased by such Buyer at the Closing by wire transfer
of immediately available funds pursuant to the wire instructions provided by the
Company.
c. The representations and warranties of such Buyer shall be true and
correct in all material respects as of the date when made and as of the Closing
Date as though made at that time (except for representations and warranties that
speak as of a specific date), and such Buyer shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by such
Buyer at or prior to the Closing Date.
d. The transactions contemplated hereby shall not violate any law,
regulation or order then in effect and applicable to Buyers or the Company.
7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.
The obligation of each Buyer hereunder to purchase the Common Shares and
Warrants at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are
for each Buyer's sole benefit and may be waived by such Buyer at any time in its
sole discretion:
a. The Company shall have executed this Agreement and the Registration
Rights Agreement, and delivered the same to such Buyer.
b. The Common Stock shall be listed and authorized for trading on the
NASDAQ National Market, and trading in the Common Stock issuable upon exercise
of the Warrants to be traded on the NASDAQ National Market shall not have been
suspended by the SEC or NASDAQ.
c. The representations and warranties of the Company shall be true and
correct in all material respects (except to the extent that any of such
representations and warranties is already qualified as to materiality in Section
3 above, in which case such representations and warranties shall be true and
correct without further qualification) as of the date when made and as of the
Closing Date as though made at that time (except for representations and
warranties that speak as of a specific date) and the Company shall have
performed, satisfied and complied in all material respects with the covenants,
agreements and conditions required by this Agreement to be performed, satisfied
or complied with by the Company at or prior to the Closing Date.
d. Each Buyer shall have received (and be an addressee on) the opinion
of Xxxxxx Xxxxxx LLP, dated as of the Closing Date, in form, scope and substance
reasonably satisfactory to such Buyer and in substantially the form of Exhibit D
attached hereto.
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e. The Company shall have executed and delivered to such Buyer the Stock
Certificates (in such denominations as such Buyer shall request) for the Common
Shares purchased by such Buyer at the Closing.
f. The Company shall have executed and delivered to such Buyer the
Warrants being purchased by such Buyer at the Closing.
g. The Board of Directors of the Company shall have adopted the
resolutions in substantially the form of Exhibit E attached hereto.
h. As of the Closing Date, the Company shall have reserved out of its
authorized and unissued Common Stock solely for the purpose of effecting the
exercise of the Warrants, shares of Common Stock to provide for the issuance of
the Warrant Shares in accordance with the terms of this Agreement and the
Warrants.
i. The Irrevocable Transfer Agent Instructions, in the form of Exhibit C
attached hereto, shall have been delivered to and acknowledged in writing by the
Company's transfer agent.
j. The transactions contemplated hereby shall not violate any law,
regulation or order then in effect and applicable to Buyers or the Company.
8. INTENTIONALLY DELETED.
9. GOVERNING LAW; MISCELLANEOUS.
a. Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York without regard to the
principles of conflict of laws.
b. Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other party. In the event any signature page is delivered by
facsimile transmission, the party using such means of delivery shall cause four
(4) additional original executed signature pages to be physically delivered to
the other party within five (5) days of the execution and delivery hereof.
c. Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
d. Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.
e. Entire Agreement; Amendments. This Agreement supersedes all other
prior oral or written agreements between the Buyers and the Company, their
affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement and the documents referenced herein contain
the entire understanding of the parties with respect to the matters covered
herein and therein and, except as specifically set forth herein or therein,
neither the Company nor any Buyer makes any representation, warranty, covenant
or undertaking with respect to such matters. No provision of this Agreement may
be waived or amended other than by an instrument in writing signed by the party
to be charged with enforcement.
f. Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement shall be in
writing and will be deemed to have been delivered (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile if received
prior to 5:00 p.m. (if a mechanically generated confirmation is generated) on a
business day ; (iii) three days after being sent
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by U.S. certified mail, return receipt requested, or (iv) one day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. For purposes of consent under
Section 4 (i)(ii), notice shall be delivered only by U.S. certified mail, return
receipt requested. The addresses and facsimile numbers for such communications
shall be:
If to the Company:
Starbase Corporation
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx Xxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxx, Vice President and
Chief Financial Officer
and
Starbase Corporation
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx Xxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx Xxxx, Esq., Corporate Counsel
With a copy to:
Xxxxxx Xxxxxx LLP
The Chrysler Building
000 Xxxxxxxxx Xxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxxxxxxxx Xxxxxxx and Xxxxxx Xxxxxxxx
If to the Transfer Agent:
American Stock Transfer & Trust Company
0000 00xx Xxxxxx, 0xx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxx
If to a Buyer, to its address and facsimile number on the Schedule of
Buyers, with copies to such Buyer's counsel as set forth on the Schedule of
Buyers:
Each party shall provide five days' prior written notice to the other party
of any change in address or facsimile number.
g. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and assigns,
including any purchasers of the Securities. The Company shall not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Buyers. A Buyer may assign some or all of its rights hereunder
without the consent of the Company, provided, however, that (i) any such
assignment shall not release such Buyer from its obligations hereunder unless
such obligations are assumed by such assignee and the Company has consented to
such assignment and assumption, (ii)
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no Buyer may assign its rights hereunder in a manner that would cause the
offering of Securities hereunder to be required to be registered under the 1933
Act and (iii) such assignee is not a direct competitor of the Company.
h. No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.
i. Survival. The representations and warranties of the Company and the
Buyers contained in Sections 3 and 2, respectively, shall survive the Closing
until eighteen months after the Closing Date. The agreements and covenants set
forth in Sections 4, 5 and 8, shall survive the Closing. Each Buyer shall be
responsible only for its own representations, warranties, agreements and
covenants hereunder.
j. Publicity. The Company and each Buyer shall have the right to approve
before issuance any press releases or any other public statements with respect
to the transactions contemplated hereby; provided, however, that the Company
shall be entitled, without the prior approval of any Buyer, to make any press
release or other public disclosure with respect to such transactions as is
required by applicable law and regulations (although each Buyer shall be
consulted by the Company in connection with any such press release or other
public disclosure prior to its release and shall be provided with a copy
thereof), but only to the extent required by such law or regulation.
k. Further Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
l. No Strict Construction. The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.
m. Equitable Relief. The Company recognizes that in the event that it
fails to perform, observe, or discharge any or all of its obligations under this
Agreement, any remedy at law may prove to be inadequate relief to the Buyers.
The Company therefore agrees that the Buyers shall be entitled to seek temporary
and permanent injunctive relief in any such case without the necessity of
proving actual damages.
n. Consent to Jurisdiction. The parties hereto expressly submit
themselves to the exclusive jurisdiction of the state and federal courts of New
York in any action or proceeding relating to this Agreement or any of the other
documents contemplated hereby or any of the transactions contemplated hereby or
thereby. Each party hereby irrevocably waives, to the fullest extent permitted
by law, any objection that it may now or hereafter have to the laying of venue
of any such action, suit or proceeding brought in such a court and any claim
that any such action, suit or proceeding brought in such a court has been
brought in an inconvenient forum. The parties hereto irrevocably and
unconditionally consent to the service of process of any of the aforementioned
courts in any such action, suit or proceeding by the mailing of copies thereof
by registered or certified mail, postage prepaid, at their respective addresses
set forth or provided for herein, such service to become effective 10 days after
such mailing. Nothing herein shall affect the right of any party to serve
process in any manner permitted by law or to commence legal proceedings or
otherwise proceed against the other parties in any other jurisdiction.
IN WITNESS WHEREOF, the Buyers and the Company have caused this Securities
Purchase Agreement to be duly executed as of the date first written above.
COMPANY:
-------
STARBASE CORPORATION
By:
--------------------------------
Print Name:
Title:
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BUYERS:
------
[Name of Investor]
BY: [Name of Investor]
By:
---------------------------
Name:
Title:
[Address of Investor]
Fax:
[Name of Investor]
BY: [Name of Investor]
By:
-----------------------
Name:
Title:
[Address of Investor]
Fax:
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SCHEDULE OF BUYERS
INVESTOR ADDRESS AND INVESTOR'S LEGAL COUNSEL AND
INVESTOR NAME FACSIMILE NUMBER COUNSEL'S ADDRESS
-------------------------------- ----------------------- -----------------------------
[Name of Investor] [Address of Investor] [Name and Address of Counsel]
Fax:
_______ shares of Common Stock
for an aggregate purchase price of
$______ million
_______ Warrants
[Name of Investor] [Address of Investor] [Name and Address of Counsel]
Fax:
_______ shares of Common Stock for
an aggregate purchase price of
$______ million
_______ Warrants
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List of Exhibits
Exhibit A Form of Warrant
Exhibit B Form of Registration Rights Agreement
Exhibit C Form of Transfer Agent Instructions
Exhibit D Form of Opinion of Xxxxxx Xxxxxx
Exhibit E Form of Resolutions of Board
List of Schedules
3(a) List of Subsidiaries & Jurisdictions of Due Qualification
3(c) Capitalization and Indebtedness
3(e) No Conflicts
3(g) Certain Changes
3(l) Employment; Erisa
3(n) Title
3(q) Tax Status
3(r) Certain Transactions
