SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) November 13, 1998
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Base Ten Systems, Inc.
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(Exact Name of Registrant as Specified in Charter)
New Jersey 0-7100 22-1804206
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(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
One Electronics Drive, Trenton, New Jersey 08619
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (609)586-7010
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Inapplicable
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(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 5. Other Events.
On November 13, 1998, Base Ten Systems, Inc. (the "Company") completed
the sale of 6,666,666 shares of the Company's Class A common stock ("Common
Stock") to Jesse L. Upchurch ("Purchaser") at a purchase price of $3.00 per
share. The Company received proceeds of approximately $18,800,000 from the
transaction. The sale was made pursuant to a Stock Purchase Agreement by and
between the Company and Purchaser dated November 12, 1998 (the "Stock Purchase
Agreement"). In connection with the sale, and pursuant to the terms of the Stock
Purchase Agreement, the Company also granted to Purchaser seven year warrants,
immediately exercisable, to purchase up to an additional 1,000,000 shares of
Common Stock at a price of $3.00 per share.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit 10(ww) Stock Purchase Agreement dated as
of November 12, 1998 by and between Base
Ten Systems, Inc. and Jesse L. Upchurch.
Exhibit 99 Press Release, dated November 13, 1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BASE TEN SYSTEMS, INC.
WILLIAM F. HACKETT
Dated: November 19, 1998 By: _______________________________
William F. Hackett
Senior Vice President,
Chief Financial Officer and Secretary
<PAGE>
EXHIBIT INDEX
Exhibit 10(ww) Stock Purchase Agreement dated as
of November 12, 1998 by and between Base
Ten Systems, Inc. and Jesse L. Upchurch.
Exhibit 99 Press Release, dated November 13,
1998.
STOCK PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is made as of the
12th day of November, 1998, by and between BASE TEN SYSTEMS, INC., a New Jersey
corporation with its principal executive offices located at One Electronics
Drive, Trenton, New Jersey 08619 (the "Company") and JESSE L. UPCHURCH, an
individual with an address at c/o Andrew Garrett, Inc., 52 Vanderbilt Avenue,
20th Floor, New York, New York 10017 (the "Purchaser").
The parties hereto, intending to be legally bound, agree as
follows:
1. AUTHORIZATION OF ISSUANCE.
The Company has authorized the issuance and sale of (i) an
aggregate of up to $20,000,000 of its Class A Common Stock, par value $1.00 per
share, (the "Common Stock") at a purchase price of $3.00 per share, and (ii)
50,000 Common Stock Purchase Warrants for each $1,000,000 of Common Stock
purchased.
2. SALE AND PURCHASE.
Subject to the terms and conditions hereof, the Company hereby
sells to the Purchaser, and the Purchaser hereby purchases from the Company, on
the Closing Date, (i) up to 6,666,666 shares of Common Stock (the "Shares"), and
(ii) up to 1,000,000 Common Stock Purchase Warrants (the "Warrants"). The shares
of Common Stock issuable upon exercise of the Warrants are referred to herein as
the "Warrant Shares." The Shares, the Warrants and the Warrant Shares are
referred to herein as the "Securities."
3. CLOSING.
The closing (the "Closing") of the purchase and sale of the
Shares and the Warrants will take place within five (5) Business Days following
the date the Company obtains Stockholder Approval or such other time and date as
shall be mutually agreed upon by the Purchaser and the Company. Such time and
date is herein called the "Closing Date." The closing shall occur at the offices
of Pitney, Hardin, Kipp & Szuch, 200 Campus Drive, Florham Park, New Jersey,
07932, or at such other location as may be agreed to by the parties.
On the Closing Date the Company shall deliver to the Purchaser
certificates representing the Shares (or evidence that the Company has
instructed its transfer agent to issue the Shares) and the Warrants against
delivery by the Purchaser to the Company of a certified or official bank
check(s) or wire transfer(s) in an aggregate amount equal to the aggregate
purchase price for the Shares, payable to the order of the Company in
immediately available funds.
4. REPRESENTATIONS AND WARRANTIES BY THE COMPANY.
The Company represents and warrants that:
4.1 Organization and Existence, Authority, etc. The Company is
a corporation duly organized and validly existing and in good standing under the
laws of the State of New Jersey, and has all requisite corporate power and
authority to carry on its business as now conducted and proposed to be
conducted; the Company has all requisite corporate power and authority to enter
into this Agreement, to issue the Shares and the Warrants as contemplated herein
and to carry out the provisions and conditions of this Agreement and of the
Warrants. This Agreement and the Warrants have been duly executed and delivered
by, and constitute the valid and binding obligations of, the Company,
enforceable in accordance with their respective terms, subject to the effect of
any applicable bankruptcy, moratorium, insolvency, reorganization or other
similar law affecting the enforceability of creditors' rights generally and to
the effect of general principals of equity which may limit the availability of
remedies (whether in a proceeding at law or in equity). The Company is duly
qualified and is authorized to do business and is in good standing as a foreign
corporation in each jurisdiction in which the conduct of its business or
ownership of its properties would so require, except where the failure to be so
qualified would not have a material adverse effect on its business and financial
condition, taken as a whole.
4.2 Litigation. Except as disclosed in the Company Commission
Filings (as hereinafter defined), to the knowledge of the Company, there is no
action, suit or proceeding pending, or threatened, against the Company before
any court, administrative agency or arbitrator which could reasonably be
expected to result in any material adverse change in the business, properties,
condition (financial or otherwise) of the Company taken as a whole, or which
challenges the validity of any action taken or to be taken pursuant to or in
connection with this Agreement.
4.3 Charter Documents. Neither the execution nor the delivery
of this Agreement, the Shares or the Warrants, nor the consummation of the
transactions contemplated hereby, nor compliance with the terms and provisions
hereof, will conflict with, or result in a breach of or creation of a lien
under, the terms, conditions or provisions of, or constitute a default under,
the charter or by-laws of the Company, as amended, copies of which have been
provided to the Purchaser.
4.4 Authorized and Outstanding Capital Stock. At September 25,
1998, the Company had authorized (i) 40,000,000 shares of Class A Common Stock,
par value $1.00 per share, of which 10,477,221 shares were issued and
outstanding, and (ii) 2,000,000 shares of Class B Common Stock, par value $1.00
per share, of which 77,236 shares were issued and outstanding, and (iii)
997,800.9375, shares of preferred stock. Of the preferred stock, 18,177.734375
shares have been designated as Series A Convertible Preferred Stock, par value
$1.00 per share, all of which were issued and outstanding. All of such
outstanding shares of Common Stock and preferred stock have been validly issued
and are fully paid and non-assessable. The Company has authorized (i) the
issuance and sale to the Purchaser of up to an aggregate of 6,666,666 shares of
Common Stock, (ii) the issuance and sale to the Purchaser of up to 1,000,000
Warrants, and (iii) upon conversion of the Warrants, the Warrant Shares. The
Shares and the Warrant Shares, when issued in accordance with the terms of this
Agreement and the Warrants, will be validly issued, fully paid and
non-assessable.
4.5 Broker's and Finder's Fees. The Company will pay all
broker's and finder's fees incurred by the Company in connection with the sale
of the Shares and the Warrants, as described on Schedule 4.5.
4.6 Commission Filings and Financial Statements. The Company
has heretofore made available to the Purchaser true and complete copies of all
reports, registration statements, definitive proxy statements and other
documents (in each case together with all amendments and supplements thereto)
filed by the Company with the Commission since June 30, 1998 (such reports,
registration statements, definitive proxy statements and other documents,
together with any amendments and supplements thereto, are sometimes collectively
referred to as the "Company Commission Filings"). The Company Commission Filings
constitute all of the documents (other than preliminary materials) that the
Company was required to file with the Commission since such date. As of their
respective dates, each of the Company Commission Filings complied in all
material respects with the applicable requirements of the Securities Act and the
Exchange Act, as applicable, and the rules and regulations under each such Act,
and none of the Company Commission Filings contained as of such date and untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. When filed with the
Commission the financial statements included in the Company Commission Filings
complied as to form in all material respects with the applicable rules and
regulations of the Commission and were prepared in accordance with generally
accepted accounting principles (as in effect from time to time) applied on a
consistent basis (except as may be indicated therein or in the notes or
schedules thereto), and such financial statements fairly present in accordance
with generally accepted accounting principles in all material respects the
financial position of the Company as at the dates thereof and the results of its
operations and its cash flows for the periods then ended, subject, in the case
of the unaudited interim financial statements, to normal, recurring year-end
audit adjustments and the absence of footnotes. Since June 30, 1998, except as
disclosed in the Company Commission Filings filed with the Commission prior to
the date hereof, the Company has not incurred any liability or obligation of any
kind outside of the ordinary course of business, and no other event has
occurred, which in the ordinary course of business, and no other event has
occurred, which in any case or in the aggregate, would have a material adverse
effect on the business, assets, results of operations or financial condition of
the Company.
4.7 Tax Returns and Payments. The Company has filed all tax
returns required by law to be filed by it and has paid all material taxes,
assessments and other governmental charges levied upon the Company and any of
its properties, assets, income or franchises which are due and payable, other
than those presently payable without penalty or interest or those that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently conducted and for which adequate reserves have been established on
the books of the Company in accordance with generally accepted accounting
principles. The charges, accruals and reserves on the books of the Company in
respect of Federal, state and foreign income taxes for all fiscal periods are
adequate in the opinion of the Company, and the Company has not been notified of
any material unpaid assessment for additional Federal, state or foreign income
taxes for any period or any basis for any such assessment for which adequate
provision has not been made in its accounts in accordance with generally
accepted accounting principles.
4.8 Indebtedness. The Company Commission Filings correctly
describe all material secured and unsecured Indebtedness of the Company
outstanding, or for which the Company has commitments, on the date of this
Agreement, and identify in all material respects the collateral securing any
such secured Indebtedness. The Company is not in material default with respect
to the payment of any material Indebtedness or with respect to any instrument or
agreement relating thereto.
4.9 Title to Properties. The Company has good and sufficient
title to its material properties and assets, including the properties and assets
reflected in the financial statements as of and for the period ended June 30,
1998 (except properties and assets disposed of since such date in the ordinary
course of business and properties and assets held under Capital Leases). The
Company enjoys peaceful and undisturbed possession under all material leases
necessary in any material respect for the operation of its material properties
and assets, and all such leases are valid and subsisting and are in full force
and effect.
4.10 Compliance with Other Instruments. The Company is not in
violation of any term of its certificate or articles of incorporation or
by-laws, and the Company is not in material violation of any material term of
any material agreement or instrument to which it is a party or by which it is
bound or any material term of any applicable law, ordinance, rule or regulation
of any governmental authority or any material term of any applicable order,
judgment or decree of any court, arbitrator or governmental authority, the
consequences of which violation might have a materially adverse effect on the
business, condition (financial or other), operations, assets or properties of
the Company; the execution, delivery and performance of this Agreement and the
Warrants, will not result in any material violation of or be in material
conflict with or constitute a material default under any such term; and there is
no such term which materially adversely affects the business, condition
(financial or other), operations, assets, or properties of the Company, taken as
a whole.
4.11 Governmental Consent. No material consent, approval or
authorization of, or declaration or filing with, any governmental authority on
the part of the Company or any of its Subsidiaries is required for the valid
execution and delivery of this Agreement or the valid offer, issue, sale and
delivery of the Shares and the Warrants pursuant to this Agreement, except where
the failure to obtain such consent or make such filing would not have a material
adverse effect on the business, operations or assets of the Company, and except
for appropriate filings (i) with the NASDAQ National Market System of an
additional listing application for the Shares and the Warrant Shares, and (ii)
with such state securities commissions in respect of "blue sky" laws as may be
appropriate.
4.12 Use of Proceeds. The Company will apply the net proceeds
of the sale of the Shares as follows: (i) up to $5,000,000 will be utilized for
a stock buy-back program of up to 1,000,000 shares of Common Stock, (ii) up to
$2,000,000 will be applied to possible acquisitions, and (iii) the balance of
the net proceeds will be applied to the Company's continued development of
BASE10(TM)MX and BASE10(TM)CS and for general corporate purposes.
4.13 Solvency. On the Closing Date and after giving effect to
the application of the proceeds of the Shares as specified in Section 4.12, the
Company will be Solvent.
4.14 Disclosure. To the best of the Company's knowledge, there
is no fact (other than matters of a general economic or political nature which
does not affect the Company uniquely) known to the Company which materially
adversely affects the business, condition (financial or other), operations,
assets or properties of the Company which has not been set forth either in the
Company Commission Filings or in this Agreement or in the other documents,
certificates and instruments delivered to the Purchaser by or on behalf of the
Company specifically for use in connection with the transactions contemplated by
this Agreement.
5. REPRESENTATIONS OF THE PURCHASER.
5.1 Representations. (a) The Purchaser hereby represents that
the Purchaser is capable of evaluating the risk of its investment in the Shares
and is able to bear the economic risk of such investment, that it is purchasing
the Shares for its own account and that the Shares are being purchased by the
Purchaser for investment and not with a view to any resale or distribution
thereof. If the Purchaser should in the future decide to dispose of the Shares
(which it does not now contemplate), it is understood that the Purchaser may do
so only in complete compliance with the Securities Act and any applicable state
Blue Sky or securities laws.
(b) The Purchaser hereby represents that the Purchaser is an
"accredited investor" within the meaning of Regulation D of the General Rules
and Regulations promulgated under the Securities Act ("Regulation D"). In
connection therewith, the Purchaser represents and warrants to the Company that
the Purchaser meets either of the following standards for determination of
"accredited investor" status of Regulation D set forth below:
1. A natural person whose individual net worth,
or joint net worth with that person's
spouse, at the time of his purchase exceeds
$1,000,000; or
2. A natural person who had an individual
income in excess of $200,000 in each of the
two most recent years or joint income with
that person's spouse in excess of $300,000
in each of those years and has a reasonable
expectation of reaching the same income
level in the current year.
(c) The Purchaser hereby represents that the Purchaser (i) has
received and carefully reviewed the Company Commission Filings, and (ii) has had
the opportunity to ask questions and receive answers from the Company concerning
the Company Commission Filings and the terms and conditions of the offering of
the Shares and to obtain any documents relating to the Company which are
publicly available and any additional information or documents relating to the
Company which the Company possesses or can acquire without unreasonable effort
or expense.
(d) The Purchaser acknowledges that the Purchaser is aware of
the risks inherent in an investment in the Company and specifically the risks of
an investment in the Shares, and that the Purchaser is capable of bearing a
complete loss of such investment.
(e) The Purchaser hereby represents that the execution,
delivery and performance by it of this Agreement and the purchase by it of the
Shares does not violate any material term of any law, rule, regulation, court
order, judgment or contractual or other obligation applicable to the Purchaser,
the consequences of which violation might have a materially adverse effect on
the business, condition (financial or other), operations, assets or properties
of such Purchaser.
(f) The Purchaser's Schedule 13D and Forms 3, 4 and 5 filings
with the Commission for the periods since June 30, 1998 are all accurate and
complete and have been timely filed with the Commission.
(g) As of September 30, 1998, the Purchaser owns approximately
22.5% of the voting power of the Company, whether directly, indirectly or
beneficially.
6. CONDITIONS TO OBLIGATIONS.
The Purchaser's obligation to purchase the Shares hereunder is
subject to satisfaction of the following conditions at the Closing:
6.1 Stockholder Approval. The Company shall have obtained
Stockholder Approval.
6.2 Accuracy of Representations and Warranties. The
representations and warranties of the Company herein or in any certificate or
document delivered pursuant hereto shall be true and correct on and as of the
Closing Date with the same effect as though made on and as of the Closing Date.
6.3 Performance. The Company shall have performed and
complied, in each case in all material respects, with all material agreements
and conditions contained in this Agreement required to be performed or complied
with by it prior to or at the Closing.
6.4 Officers' Certificate. The Purchaser shall have received a
certificate dated the Closing Date and signed by the President, a Vice President
or Chairman or Vice Chairman of the Company and by the Secretary, the Treasurer,
an Assistant Secretary or an Assistant Treasurer of the Company, to the effect
that the conditions of Sections 6.1, 6.2 and 6.3 hereof have been satisfied.
6.5 Proceedings. All corporate and other proceedings in
connection with the transactions contemplated by this Agreement and all
documents incident thereto shall be in form and substance reasonably
satisfactory to the Purchaser, and the Purchaser's counsel, who shall have
received all such originals or certified or other copies of such documents as
they may reasonably request.
6.6 No Litigation. No action, suit or proceeding before any
court or any governmental or regulatory authority shall have been commenced and
still be pending, and no investigation by any governmental or regulatory
authority shall have been commenced and still be pending, against the Company
seeking to restrain, prevent or change the transactions contemplated hereby or
questioning the validity or legality of any of such transactions.
6.7 Purchase Permitted by Applicable Laws. The offering,
issuance, purchase and sale of, and payment for, the Shares to be purchased by
the Purchaser on the Closing Date on the terms and conditions herein provided
(including the use of the proceeds of such Shares by the Company) shall not
violate any law or governmental regulation applicable to the Purchaser.
6.8 Compliance with Securities Laws. The offering and sale of
the Shares at or prior to the Closing under this Agreement shall have compiled
in all material respects with all applicable requirements of federal and state
securities laws.
7. LEGENDS.
The Company may endorse on all certificates evidencing Shares
and Warrants Shares (issued upon conversion of the Warrants) a legend
restricting their transfer that shall read as follows: "THE SHARES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "ACT"). THE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT
BE SOLD, TRANSFERRED, PLEDGED, ASSIGNED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT FOR THESE SHARES UNDER THE ACT OR AN
OPINION, IF REQUESTED, OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION
IS NOT REQUIRED UNDER THE ACT"; provided, that if an opinion of satisfactory
counsel which opinion shall be reasonably satisfactory to counsel for the
Company concludes that the legend is no longer necessary, the Company will
deliver upon transfer or exchange Share or Warrant Share certificates without
such legends.
8. REGISTRATION RIGHTS.
8.1 Mandatory Registration. As soon as practical after the Closing
Date, the Company will file a Registration Statement on Form S-3 (if such form
is then available for use by the Company, or if such form is not then available
for use by the Company, another form that is available to the Company)
permitting the registration of the Shares and the Warrant Shares for resale by
the Purchaser in the manner or manners reasonably designated by the Purchaser
(including, without limitation, one or more underwritten offerings). The Company
shall use its best efforts to cause such registration statement to be declared
effective pursuant to the Securities Act as promptly as possible following the
filing thereof, and subject to applicable rules and orders, to keep such
registration statement continuously effective under the Securities Act until the
earlier of (i) the date on which all of the Shares and Warrant Shares have been
sold, or (ii) the date on which the Shares and Warrant Shares (in the opinion of
the Purchaser's counsel) may be immediately sold without registration pursuant
to Rule 144 under the Securities Act (the "Registration Period").
8.2 "Piggyback Registration Rights." At any time prior to expiration of
the Registration Period in the event a Registration Statement permitting the
registration of the Shares and the Warrant Shares for resale by the Purchaser is
not in effect, the Company shall, at least thirty (30) days prior to the filing
of any registration statement under the Securities Act (other than a
registration statement on Form S-8 or Form S-4 or any successor forms) relating
to the public offering of its Common Stock by the Company or any of its security
holders, give written notice of such proposed filing and of the proposed date
thereof to the Purchaser, and if, on or before the twentieth (20th) day
following the date on which such notice is given, the Company shall receive a
written request from the Purchaser requesting that the Company include among the
securities covered by such registration statement some or all of the Shares or
the Warrant Shares held by or to be held after conversion by the Purchaser, the
Company shall include such Shares or Warrant Shares in such registration
statement, if filed, so as to permit such Shares or Warrant Shares to be sold or
disposed of in the manner and on the terms of the offering thereof set forth in
such request.
8.3 Terms and Conditions of Registration. Except as otherwise provided
herein, in connection with any registration statement filed pursuant to Sections
8.1 or 8.2 herein, the following provisions shall apply:
(i) If such registration statement shall be filed
pursuant to Section 8.2 hereof and if the managing underwriter advises the
Company in writing that the inclusion in such registration of some or all of the
Shares or Warrant Shares sought to be registered by the Purchaser creates a
substantial risk that the proceeds or price per share that will be derived from
such registration will be reduced or that the number of shares to be registered
at the insistence of the Purchaser, plus the number of shares of Common Stock
sought to be registered by the Company and any other stockholders of the Company
is too large a number to be reasonably sold, then, in such event, the number of
shares sought to be registered for the stockholders of the Company shall be
reduced, pro rata in proportion to the number of shares sought to be registered
to the number of shares recommended be sold by the managing underwriter.
(ii) If requested by the Purchaser in connection with
a registration statement filed pursuant to Section 8.1, the Company will enter
into an underwriting agreement with the underwriters for such offering, such
agreement to be reasonably satisfactory in form and substance to the Company,
the Purchaser and the underwriters, and to contain such representations,
warranties and covenants by the Company and such other terms as are customarily
contained in such agreements used by the managing underwriter, including,
without limitation, restrictions of sales of Common Stock or other securities by
the Company as may be reasonably agreed to between the Company and such
underwriters, and indemnities and rights to contributions to the effect and to
the extent provided in Sections 9.1 and 9.2 hereof. The Purchaser shall be a
party to any underwriting agreement relating to an underwritten sale of the
Shares or Warrant Shares and may, at the Purchaser's option, require that any or
all of the representations, warranties and covenants of the Company to or for
the benefit of such underwriters, shall also be made to and for the benefit of
the Purchaser. All representations and warranties of the Purchaser shall be made
to or for the benefit of the Company.
(iii) The Company shall provide a transfer agent and
registrar (which may be the same entity) for the Shares and the Warrant Shares,
not later than the effective date of such registration.
(iv) All expenses in connection with the preparation
and filing of a registration statement filed pursuant to Sections 8.1 or 8.2
shall be borne solely by the Company, except for any transfer taxes payable with
respect to the disposition of such Shares and Warrant Shares, and any
underwriting discounts and selling commissions applicable solely to such sales
of Shares and Warrant Shares, which shall be paid by the Purchaser.
(v) The Company shall use its best efforts to cause
all of the Shares and Warrant Shares covered by such registration statement to
be quoted on the NASDAQ National Market System if the quoting or listing of such
registered shares is permitted by such exchange.
(vi) Following the effective date of such
registration statement, the Company shall, upon the request of the Purchaser,
forthwith supply such number of prospectuses (including exhibits thereof and
preliminary prospectuses and amendments and supplements thereto) meeting the
requirements of the Securities Act and such other documents as are referred to
in the prospectus as shall be reasonably requested by the Purchaser to permit
the Purchaser to make a public distribution of the Shares and Warrant Shares.
(vii) The Company shall prepare, if necessary, and
file such amendments and supplements to such registration statement filed
pursuant to Sections 8.1 and 8.2 hereof, as may be necessary to keep such
registration statement effective, subject to applicable laws, rules and orders,
during the Registration Period.
(viii) The Purchaser may select the underwriter or
underwriters (which shall be of nationally recognized standing), if any, who are
to undertake any offering and distribution of the Shares and Warrant Shares to
be included in a registration statement filed under the provisions of Subsection
8.2 hereof, subject to the Company's prior approval of the underwriter, which
approval shall not be unreasonably withheld.
(ix) The Company shall use its best efforts to
register the Shares and the Warrant Shares covered by any such registration
statements filed pursuant to Section 8.2 under such securities or Blue Sky laws
in addition to those in which the Company would otherwise sell shares, as the
Purchaser reasonably request, except that neither the Company nor the Purchaser
shall for any such purpose be required to execute a general consent to service
of process or to qualify to do business as a foreign corporation in any
jurisdiction where it is not so qualified. The fees and expenses incurred in
connection with such registration shall be borne by the Company.
(x) The Purchaser shall cooperate fully with the
Company and provide the Company with all information reasonably requested by the
Company for inclusion in the registration statement or as necessary to comply
with the Securities Act. The Company shall cooperate fully with any underwriters
selected by the Purchaser and counsel to such underwriters, and shall provide
reasonable and customary access to the Company's books and records (upon receipt
from such underwriters of customary confidentiality agreements) in order to
facilitate such underwriters' review and examination of the Company in
connection with such underwriting.
(xi) The Company shall notify the Purchaser, at any
time after effectiveness when a prospectus relating thereto is required to be
delivered under the Securities Act within the period mentioned in subdivision
(vii) of this Section 8.3, of the happening of any event as a result of which
the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of circumstances then existing (and upon receipt of such
notice and until a supplemented or amended prospectus as set forth below is
available, the Purchaser shall not offer or sell any securities covered by such
registration statement and shall return all copies of such prospectus to the
Company if requested to do so by it), and at the request of the Purchaser
prepare and furnish the Purchaser promptly a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such shares, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances than existing.
(xii) The Company shall furnish to the Purchaser at
the time of the disposition of the Shares and the Warrant Shares, a signed copy
of an opinion of the Company's regular in-house or outside general counsel, or
other counsel of the Company's selection reasonably acceptable to, and which
opinion shall be reasonably satisfactory in form and substance to, the Purchaser
to the effect that: (a) a registration statement covering such Shares and
Warrant Shares has been filed with the Commission under the Securities Act and
has been made effective by order of the Commission, (b) said registration
statement and prospectus contained therein comply as to form in all material
respects with the requirements of the Securities Act, and nothing has come to
such counsel's attention (after due inquiry) which would cause such counsel to
believe that either said registration statement or such prospectus contains any
untrue statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein (in the case of
such prospectus, in light of the circumstances under which they were made) not
misleading, (c) after due inquiry such counsel knows of no legal or governmental
proceedings required to be described in such registration statement or
prospectus which are not described as required, or of any contracts or documents
of a character required to be described in such registration statement or such
prospectus to be filed as an exhibit to such registration statement or to be
incorporated by reference therein which are not described and filed as required
and (d) to such counsel's knowledge, no stop order has been issued by the
Commission suspending the effectiveness of such registration statement; it being
understood that such opinion may contain such qualifications and assumptions as
are customary in the rendering of similar opinions, and that such counsel may
rely, as to all factual matters treated therein, on certificates of the Company
(copies of which shall be delivered to the Holders).
(xiii) The Company will use its best efforts to
comply with the reporting requirements of Sections 13 and 15(d) of the Exchange
Act, to the extent it shall be required to do so pursuant to such sections, and
at all times while so required shall use its best efforts to comply with all
other public information reporting requirements of the Commission of Rule 144
promulgated by the Commission under the Securities Act) from time to time in
effect and relating to the availability of an exemption from the Securities Act
for the sale of any of the Company's Common Stock held by the Purchaser. The
Company will also cooperate with the Purchaser in supplying such information and
documentation as may be necessary for the Purchaser to complete and file any
information reporting forms presently or hereafter required by the Commission as
a condition to the availability of an exemption from the Securities Act for the
sale of any Company Common Stock held by the Purchaser.
<PAGE>
9. INDEMNIFICATION AND CONTRIBUTION; SURVIVAL.
9.1 Indemnification.
(i) In the event of the registration of any shares or
Warrant Shares under the Securities Act pursuant to the provisions of Sections
8.1 or 8.2, the Company agrees to indemnify and hold harmless the Purchaser,
each underwriter, broker or dealer, if any, and their directors, officers and
employees, of such Shares or Warrant Shares, and each other person, if any, who
controls Purchaser, such underwriter, broker or dealer within the meaning of the
Securities Act, from and against any and all losses, claims, damages for
liabilities (or actions in respect thereof), joint or several, to which the
Purchaser (and as applicable) its directors, officers or employees, or such
underwriter, broker or dealer or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities for actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any registration statement under which such shares were registered under the
Securities Act, any preliminary prospectus or final prospectus relating to such
Shares or Warrant Shares, or any amendment or supplement thereof, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of any rule or
regulation under the Securities Act applicable to the Company or relating to any
action or inaction required by the Company in connection with any such
registration and will reimburse the Purchaser, each such underwriter, broker or
dealer and controlling person, and their directors, officers or employees, for
any legal or other expenses reasonably incurred by the Purchaser or such
underwriter, broker or dealer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, such preliminary prospectus, such
final prospectus or such amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by the Purchaser
and as applicable, such Purchaser's directors, officers or employees, or such
underwriter, broker, dealer or controlling person for use in the preparation
thereof. Such indemnity shall remain in full effect irrespective of any
investigation by any person indemnified above.
(ii) In the event of the registration of any Shares
or Warrant Shares of the Purchaser under the Securities Act for sale pursuant to
the provisions of this Agreement, the Purchaser agrees to indemnify and hold
harmless the Company, its directors, officers and employees, from and against
any losses, claims, damages or liabilities, joint or several, to which the
Company, its directors, officers or employees, may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any registration statement under which such Shares or Warrant Shares were
registered under the Securities Act, any preliminary prospectus or final
prospectus relating to such Shares or Warrant Shares, or any amendment or
supplement thereof, or arise out of or are based upon omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, which untrue statement
or alleged untrue statement or omission or alleged omission was made therein in
reliance upon and in conformity with written information furnished to the
Company by the Purchaser for use in the preparation thereof. Such indemnity
shall remain in full effect irrespective of any investigation by any person
indemnified above.
(iii) Promptly after receipt by a person entitled to
indemnification under this Section 9.1 (for purposes of this Section 9.1, an
"Indemnified Party") of notice of the commencement of any action or claim
relating to any registration statement filed under Sections 8.1 or 8.2 or as to
which indemnity may be sought hereunder, such Indemnified Party will, if a claim
for indemnification hereunder in respect thereof is to be made against any other
party hereto (for purposes of this Section 9.1, an "Indemnifying Party"), give
written notice to such Indemnifying Party of the commencement of such action or
claim, but the failure to so notify the Indemnifying Party will not relieve it
from any liability which it may have to any Indemnified Party otherwise than
pursuant to the provisions of this Section 9.1 and shall also not relieve the
Indemnifying Party of its obligations under this Section 9.1, except to the
extent that the Indemnified Party is damaged solely as a result of the failure
to give timely notice. In case any such action is brought against an Indemnified
Party, and it notifies an Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled (at its own expense) to participate in and,
to the extent that it may wish, jointly with any other Indemnifying Party
similarly notified, to assume the defense with counsel satisfactory to such
Indemnified Party, of such action and/or to settle such action and, after notice
from the Indemnifying Party to such Indemnified Party of its election so to
assume the defense thereof, the Indemnifying Party will not be liable to such
Indemnified Party for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof, other than the
reasonable cost of investigation; provided, however, that no Indemnifying Party
and no Indemnified Party shall enter into any settlement agreement which would
impose any liability on such other party or parties without the prior written
consent of such other party or parties.
9.2 Contribution. If the indemnification provided for in
Section 9.1 hereof is unavailable to the Indemnified Party in respect of any
losses, claims, damages or liabilities referred to herein, then each such
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities (i) as between the Company and
the Purchaser on the one hand and the underwriters on the other, in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Purchaser on the one hand and the underwriters on the other from
the offering of the Shares and the Warrant Shares, or if such allocation is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only such relative benefits but also the relative fault of the Company and the
Purchaser on the one hand and of the underwriters on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations and (ii)
as between the Company on the one hand and each Purchaser on the other, in such
proportion as is appropriate to reflect the relative fault of the Company and of
each Purchaser in connection with such statements or omissions, as well as any
other relevant equitable considerations.
In no event shall the obligation of any Indemnifying Party to
contribute under this Section 9.2 exceed the amount that such Indemnifying Party
would have been obligated to pay by way of indemnification if the
indemnification provided for under Section 9.1 hereof had been available under
the circumstances.
The amount paid or payable by an Indemnified Party as a result
of the losses, claims, damages and liabilities referred to in the next preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Party in
connection with investigating or defending any such Indemnified Party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 9.2, neither the Purchaser nor
the underwriter shall be required to contribute any amount in excess of the
amount by which (i) in the case of a Purchaser, the net proceeds received by the
Purchaser from the sale of Shares or the Warrant Shares or (ii) in the case of
an underwriter, the total price at which the Shares purchased by it and
distributed to the public were offered to the public exceeds, in any case, the
amount of any damages that the Purchaser or underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
9.3 Survival. The indemnity and contribution agreements
contained in this Section 9 shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement or any underwriting
agreement, (ii) any investigation made by or on behalf of any Indemnified Party
or by or on behalf of the Company and (iii) the consummation of the sale or
successive resales of the Shares and the Warrant Shares.
10. AMENDMENT AND WAIVER.
No waiver, amendment, modification or supplement of this
Agreement will be binding upon the Company or the Purchaser unless such waiver,
amendment, modification or supplement is set forth in writing and is executed by
such party.
11. NOTICES.
All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been made when
delivered by courier or mailed express mail or transmitted by telex, facsimile,
or other means of electronic transmission:
(a) if to the Purchaser, at such Purchaser's address as set
forth in the preamble, or at such other address as may have been furnished to
the Company by the Purchaser in writing; or
(b) if to the Company, at One Electronic Drive, Trenton, New
Jersey 08619; Attention: Thomas E. Gardner, Chairman, Chief Executive Officer
and President, or at such other address as may have been furnished to the
Purchaser in writing by the Company.
12. ENTIRE AGREEMENT.
This Agreement and the Warrants embody the entire agreement
and understanding between the Purchasers and the Company and supersede all prior
agreements and understandings relating to the subject matter hereof.
13. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement contained by or
on behalf of any of the parties hereto shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto whether so expressed
or not.
14. HEADINGS.
The headings of the articles and sections of this Agreement
have been inserted for convenience of reference only and shall in no way
restrict or otherwise modify any of the terms or provisions hereof.
15. GOVERNING LAW.
This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey, without giving effect
to its conflict of laws rules.
16. COUNTERPARTS.
This Agreement may be signed in any number of counterparts
with the same effect as if the signatures thereto and hereto were upon the same
instrument. Facsimile signatures shall be deemed acceptable and binding.
17. SEVERABILITY.
Any provision hereof which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or thereof, and any such prohibition or unenforceability in
any jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction.
18. DEFINITIONS.
The following terms, when used in this Agreement, shall have
the following meanings:
"Affiliate" shall mean any person that controls, is controlled
by or is under common control with the person in question. For purposes hereof,
"control" and the correlative definitions "controlled by" and "under common
control with" shall mean the power and ability to direct the management and
affairs of the person in question, whether through the ownership of voting
securities, by contract or otherwise.
"Agreement" has the meaning set forth in the preamble.
"beneficial owner" has the meaning set forth in Rule 13d-3
promulgated by the Commission under the Exchange Act.
"Board" or "Board of Directors" means, with respect to any
person which is a corporation, a joint stock company or a business trust, the
board of directors or other group, however designated, which is charged with
legal responsibility for the management of such person, or any committee of such
board of directors or group, however designated, which is authorized to exercise
the power of such board or group in respect of the matter in question.
"Business Day" means any day other than a Saturday, Sunday or
other day on which banks in the State of New Jersey are legally authorized to
close.
"Capital Lease" shall mean a lease of property which is
capitalized on the financial statements of the lessee in accordance with
generally accepted accounting principles.
"Closing" has the meaning set forth in Article 3.
"Closing Date" has the meaning set forth in Article 3.
"Commission" means the Securities and Exchange Commission and
any other similar or successor agency of the federal government administering
the Securities Act or the Exchange Act.
"Company" means Base Ten Systems, Inc., a New Jersey
corporation, and its successors and assigns, including any successor corporation
by merger formed for the purpose of reincorporating the Company in the State of
Delaware.
"Consolidated" or "consolidated", when used with reference to
any financial term in this Agreement, means the aggregate for the Company and
its Subsidiaries of the amounts signified by such term, with intercompany items
eliminated and, with respect to earnings, after eliminating the portion of
earnings properly attributable to minority interests, if any, in the capital of
any such person, other than the parent of such group.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"generally accepted accounting principles" means, unless
otherwise stated, generally accepted accounting principles in effect from time
to time.
"Indebtedness" of any person means and includes, without
duplication, as of any date as of which the amount thereof is to be determined,
(i) all obligations of such person to repay money borrowed (including, without
limitation, all debentures payable and drafts accepted representing extensions
of credit, all obligations evidenced by bonds, debentures or other similar
instruments and all obligations upon which interest charges are customarily
paid), (ii) the value of all Capital Leases (as such term is defined in
accordance with generally accepted accounting principles in effect on the date
of this Agreement) in respect of which such person is liable as lessee or as the
guarantor of the lessee, (iii) the principal amount of all monetary obligations
which are secured by any lien or security interest existing on property owned by
such person whether or not the obligations secured thereby shall have been
assumed by such person, (iv) all guaranties of the Indebtedness of any other
person and (v) all amounts from time to time owing to trade creditors arising in
the ordinary course of such person's business.
"NASDAQ" means the National Association of Securities Dealers
Automated Quotation System.
"Purchaser" has the meaning set forth in the preamble.
"Securities Act" means the Securities Act of 1933, as amended.
"Share" or "Shares" has the meaning set forth in Article 1.
"Solvent" shall mean when used with respect to any person that
as of the date as to which the person's solvency is to be measured:
(a) the fair saleable value of its assets is in excess of
the total amount of its liabilities (including
contingent liabilities as valued in accordance with
applicable law) as they become absolute and matured;
(b) it has sufficient capital to conduct its business;
and
<PAGE>
(c) it is able to meet its debts as they mature.
"Stockholder Approval" means such approvals of the Company's
stockholders as may be required to issue the Shares and the Warrants.
"Subsidiary" means any corporation organized under the laws of
the United States or of any state or of the District of Columbia or any foreign
jurisdiction of which (other than directors' qualifying shares required by law)
at least a majority of the shares of each class of the capital stock entitled to
vote at the time as of which any determination is being made, is owned,
beneficially and of record, by the Company or one or more of its Subsidiaries,
or both.
IN WITNESS WHEREOF, the parties hereto have executed this
Stock Purchase Agreement of the date first written above.
BASE TEN SYSTEMS, INC.
THOMAS E. GARDNER
By:______________________________________
Name: Thomas E. Gardner
Title:Chairman & CEO
JESSE L. UPCHURCH
__________________________________
JESSE L. UPCHURCH
<PAGE>
Schedule 4.5
Brokers and Finders Fees
Andrew Garrett, Inc. will receive commissions equal to 6% of the
aggregate purchase price. Andrew Garrett, Inc., and/or its assignees and/or
designees, will receive warrants to purchase 12,500 shares of Class A Common
Stock for each $1 million of Class A Common Stock purchased.
<PAGE>
FORM OF WARRANT CERTIFICATE
No. Warrant to Purchase __________ Shares
of Class A Common Stock
BASE TEN SYSTEMS, INC.
Class A Common Stock Purchase Warrant
[DATE]
NEITHER THIS WARRANT NOR THE SHARES OF CLASS A COMMON STOCK
ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNTIL A REGISTRATION STATEMENT
WITH RESPECT THERETO IS DECLARED EFFECTIVE UNDER THE SECURITIES ACT OR BASE TEN
SYSTEMS, INC. RECEIVES AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE
TO BASE TEN SYSTEMS, INC. AND ITS COUNSEL THAT AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IS AVAILABLE.
THIS CERTIFIES THAT _____________ (hereinafter sometimes
called the "Holder") is entitled to purchase from BASE TEN SYSTEMS, INC., a New
Jersey corporation (the "Company"), at the price and during the period
hereinafter specified, up to ___________ shares (the "Warrant Shares") of the
Company's Class A Common Stock, $1.00 par value (the "Common Stock").
This Warrant is subject to adjustment in accordance with
Paragraph 9 hereof.
1. a. Exerciseability.
The rights represented by this Warrant shall
be exercisable for a period of seven (7) years commencing on the date of grant
(the "Exercise Period"). After expiration of the Exercise Period the Holder
shall have no right to purchase any shares of Common Stock underlying the
Warrant and the Warrant shall terminate.
b. Exercise Price.
The rights represented by this Warrant shall
be exercisable at a purchase price of $3.00 per share (the "Exercise Price"),
subject to adjustment in accordance with Paragraph 8.
2. The rights represented by this Warrant may be exercised at
any time within the Exercise Period above specified, in whole or in part, by (i)
the surrender of this Warrant (with the exercise form at the end hereof properly
executed) at the principal executive office of the Company (or such other office
or agency of the Company as it may designate by notice in writing to the Holder
at the address of the Holder appearing on the books of the Company); and (ii)
payment to the Company of the Exercise Price then in effect for the number of
shares of Common Stock specified in the above-mentioned exercise form together
with applicable stock transfer taxes, if any. This Warrant shall be deemed to
have been exercised, in whole or in part to the extent specified, on the close
of business on the date this Warrant is surrendered and payment is made in
accordance with the foregoing provisions of this Paragraph 2, and the person or
persons in whose name or names the certificates for shares of Common Stock shall
be issuable upon such exercise shall become the holder or holders of record of
such shares of Common Stock so purchased shall be delivered to such person or
persons within a reasonable time, not exceeding thirty (30) days, after this
Warrant shall have been exercised.
3. Holder understands that, except as set forth in Paragraph 6
hereof, neither the Warrant nor the underlying Warrant Shares will be registered
under the Securities Act and that they must be held indefinitely unless a
subsequent disposition thereof is registered under the Securities Act or the
transaction is exempt from registration. The certificate or certificates
representing any Warrant Shares shall bear the following restrictive legend:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT; OR (ii) TO THE EXTENT APPLICABLE,
PURSUANT TO RULE 144 UNDER THE SECURITIES ACT (OR
SIMILAR RULE UNDER THE SECURITIES ACT RELATING TO THE
DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF
COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO THE
COMPANY AND ITS COUNSEL, THAT AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT IS AVAILABLE."
4. The Company covenants and agrees that all shares of Common
Stock which may be issued upon exercise of this Warrant will, upon issuance, be
duly and validly issued, fully paid and nonassessable and no personal liability
will attach to the Holder thereof. The Company further covenants and agrees that
during the Exercise Period, the Company will at all times have authorized and
reserved a sufficient number of shares of its Common Stock to provide for the
exercise of this Warrant.
5. The Warrant shall not entitle the Holder to any rights,
including, without limitation, voting rights, as a stockholder of the Company.
6. This Warrant and all rights hereunder shall not be
transferred, sold, assigned or hypothecated at any time without the prior
written consent of the Company. This Warrant and all the rights hereunder shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors, approved assigns and approved transferees.
7. If, at any time during the Exercise Period, there shall be
any capital reorganization, reclassification of Common Stock (other than a
change in par value or from par value to no par value or from no par value to
par value as a result of a stock dividend or subdivision, split-up or
combination of shares), the consolidation or merger of the Company with or into
another corporation or of the sale of all or substantially all the properties
and assets of the Company as an entirety to any other corporation or person, the
unexercised portion of this Warrant shall, after such reorganization,
reclassification, consolidation, merger or sale, be exercisable for the kind and
number of shares of stock or other securities or property of the Company, or of
the corporation resulting from such consolidation or surviving such merger, to
which the Holder would have been entitled if the Holder had held shares of
Common Stock issuable upon the exercise hereof immediately prior to such
reorganization, reclassification, consolidation, merger or sale. The provisions
of this Paragraph 7 shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers and sales.
8. The Exercise Price and Exercise Period in effect at any
time and the number and kind of securities purchasable upon the exercise of this
Warrant shall be subject to adjustment from time to time upon the happening of
certain events as follows:
a. If, at any time during the Exercise
Period, the Company shall (i) declare a dividend or make a distribution on its
outstanding shares of Common Stock in shares of Common Stock, (ii) subdivide or
reclassify its outstanding shares of Common Stock into a greater number of
shares, or (iii) combine or reclassify its outstanding shares of Common Stock
into a smaller number of shares, the Exercise Price in effect at the time of the
effective date or record date, as the case may be, for such sale, dividend or
distribution or of the effective date of such subdivision, combination or
reclassification shall be appropriately adjusted by the Company.
b. Whenever the Exercise Price payable upon
exercise of this Warrant is adjusted pursuant to Paragraph 8(a) above, the
number of Warrant Shares shall be appropriately and equally adjusted by the
Company at the same time.
c. Notwithstanding any adjustment in the
Exercise Price or the number or kind of shares of Common Stock purchasable upon
the exercise of this Warrant, certificates for Warrants issued prior or
subsequent to such adjustment may continue to express the same price and number
and kind of shares of Common Stock as are initially issuable pursuant to this
Warrant.
d. The Company may, but under no
circumstances is obligated to, modify the terms of this Warrant to extend the
Exercise Period, or to lower the Exercise Price, at any time prior to the
expiration of this Warrant.
9. This Agreement shall be governed by and in accordance with
the laws of the State of New Jersey.
IN WITNESS WHEREOF, BASE TEN SYSTEMS, INC. has caused this
Warrant to be signed by its duly authorized officer as of the date set forth on
the first page hereof.
BASE TEN SYSTEMS, INC.
By:_________________________________________
Name:
Title:
<PAGE>
BASE TEN SYSTEMS, INC.
PURCHASE FORM
The undersigned hereby irrevocably elects to exercise the rights of
purchase represented by the within Warrant for, and to purchase thereunder
_________ shares of Class A Common Stock (the "Shares") provided for therein,
and requests that certificates for the Shares be issued in the name of:
- -------------------------------------------------------------------------------
(Please Print Name, Address and Social Security Number)
- --------------------------------------------------------------------------------
and, if said number of Shares shall not be all the Shares purchasable hereunder,
that a new Warrant certificate for the balance of the Shares purchasable under
the within Warrant certificate be registered in the name of the undersigned
Holder or his Assignee as below indicated and delivered to the address stated
below.
Dated: ________________, 19____
Name of Holder or Permitted Assignee (Please Print):____________________________
Address:________________________________________________________________________
Signature:______________________________________________________________________
Signature Guaranteed:
Note: The above signature must correspond with the name as written upon the
face of this Warrant certificate in every particular, without
alteration or enlargement or any change whatever, unless this Warrant
has been assigned in accordance with the terms of the Warrant.
ASSIGNMENT
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
- --------------------------------------------------------------------------------
(Please Print Name, Address and Social Security Number)
- --------------------------------------------------------------------------------
the within Warrant, hereby irrevocably constituting and appointing
___________________ Attorney to transfer said Warrant on the books of the
Company, with full power of substitution in the premises.
Dated: ______________, 19____ ____________________________________
Signature of Registered Holder
Signature Guaranteed:
Note: The above signature must correspond with the name as written upon the
face of this Warrant certificate in every particular, without
alteration or enlargement or any change whatever, unless this Warrant
has been assigned.
Contact:
William F. Hackett
Base Ten Systems, Inc.
(609) 586-7010 Ext. 2310
BASE TEN COMPLETES FINANCING
Raises $20,000,000
TRENTON, N.J. November 13, 1998 - Base Ten Systems, Inc. (Nasdaq: BASEA)
announced today that it had completed the sale of $20,000,000 worth of newly
issued common shares at a price of $3.00 per share. The transaction also
included warrants good for seven years to purchase 1,000,000 additional shares
of Base Ten Series A common stock at $3.00 per share. Base Ten shareholders
approved the transaction at a Special Meeting of Shareholders on November 10,
1998.
Thomas E. Gardner, chairman and chief executive officer of Base Ten Systems,
said, "This infusion of capital should give us the resources needed to execute
current growth plans. The Company is well positioned as a leader in solutions
level software and services for companies that are subject to cGMP (current Good
Manufacturing Practice) regulation as promulgated by the U.S. Food & Drug
Administration. It is now up to our management and professional teams to execute
our strategies well."*
Base Ten Systems is a leading software technology company, focused on execution
systems and services for the pharmaceutical, fine chemicals and medical products
industries. Through installation of BASE10(TM) software, the company's customers
around the world can enjoy more effective regulatory compliance, improved
manufacturing flexibility and reduced production cycle time. BASE10(TM)
execution systems are readily integrated with complementary software partners as
manufacturers consolidate their operations into global supply chain processes.
You can learn more about Base Ten Systems by visiting its web site at
www.base10.com.*
*Forward Looking Statements
The foregoing contains "forward looking information" within the meaning of The
Private Securities Litigation Reform Act of 1995. Such forward looking
statements may be identified by an asterisk ("*") or by such forward looking
terminology as "may", "will", "believe", "anticipate", "expect", or similar
words or variations thereof. Such forward looking statements involve certain
significant risks and uncertainties. Important factors that the Company believes
may cause actual results to differ materially from such forward looking
statements are discussed in the "Risk Factors," "Business" and "MD&A" sections
of the Company's current S-3 registration statements and annual and quarterly
reports on file with the Securities and Exchange Commission. Additional risk
factors include the effectiveness of the software and ability of the software to
operate without "bugs" in the technology, acceptance of the release by customers
and actual rollout as a result of the release. In assessing such forward looking
statements you are urged to read carefully those reports and other filings. The
Company does not undertake to publicly update or revise its forward looking
statements even if experience or future changes indicate that any such results
or event (expressed or implied) will not be realized.
# # #
