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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) JANUARY 28, 2000
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BACKWEB TECHNOLOGIES LTD.
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(Exact name of registrant as specified in charter)
ISRAEL 333-10358 512198508
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(State or other jurisdiction (Commission (IRS Employer
of incorporation Number) Identification No.)
2077 GATEWAY PLACE, SUITE 500, SAN JOSE, CA 95110
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (408) 933-1763
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NOT APPLICABLE
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(Former name or former address, if changed since last report.)
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ITEM 5 OTHER EVENTS
On January 28, 2000, BackWeb Technologies Ltd. ("BackWeb")
issued and sold 458,000 shares of BackWeb's ordinary shares, NIS 0.03 nominal
value per share ("Ordinary Shares"), for an aggregate purchase price of
$14,999,500 to RealNetworks, Inc., a Washington corporation ("RealNetworks")
pursuant to a Securities Purchase Agreement (the "Securities Purchase
Agreement"), and issued a warrant to purchase 114,500 Ordinary Shares with an
exercise price of U.S. $32.75 per share (the "Warrant") to RealNetworks. A copy
of the Securities Purchase Agreement is attached hereto as Exhibit 10.1 and
incorporated herein by reference. A copy of the Warrant is attached hereto as
Exhibit 10.2 and incorporated herein by reference.
Item 7 FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits. The following documents are filed as exhibits to
this report:
10.1 Securities Purchase Agreement by and between
BackWeb Technologies Ltd and RealNetworks, Inc.
10.2 BackWeb Technologies Ltd. Warrant issued to
RealNetworks, Inc.
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SIGNATURE
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 thereunto duly authorized.
BackWeb Technologies Ltd.
Date: February 11, 2000
By: /s/ Hanan Miron
Chief Financial Officer
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Exhibit Index
Exhibit
10.1 Securities Purchase Agreement by and between BackWeb
Technologies Ltd and RealNetworks, Inc.
10.2 BackWeb Technologies Ltd. Warrant issued to RealNetworks,
Inc.
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SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT is made and entered into as of January
17, 2000, by and between BackWeb Technologies Ltd., an Israeli corporation (the
"COMPANY"), and RealNetworks, Inc., a Washington corporation (the "PURCHASER").
THE PARTIES AGREE AS FOLLOWS:
1. AUTHORIZATION AND SALE OF SHARES AND WARRANT
1.1 AUTHORIZATION OF THE SHARES AND WARRANT
On or before the Closing Date (as defined in Section 2.1 below), the
Company will have authorized the issuance and sale, pursuant to the terms and
conditions of this Agreement, of (a) 458,000 shares (the "SHARES") of the
Company's ordinary shares, NIS 0.03 nominal value per share ("ORDINARY SHARES"),
and (b) a warrant to purchase 114,500 Ordinary Shares with an exercise price of
U.S. $32.75 per share the "WARRANT"). The per share price for the Ordinary
Shares acquired pursuant to this Agreement and for the Ordinary Shares that may
be acquired pursuant to the Warrant ($32.75 per share), is equal to the average
NASDAQ National Market closing price of the Company's Ordinary Shares for the 60
trading days before January 14, 2000.
1.2 SALE OF THE SHARES AND WARRANT
Subject to the terms and conditions contained herein, and in reliance
on the representations and warranties of the Company contained herein, on the
Closing Date (defined below) the Company will issue and sell to the Purchaser,
and the Purchaser will purchase from the Company, (a) the Shares at an aggregate
purchase price of U.S. $14,999,500 (the "SHARE PURCHASE PRICE") and (b) the
Warrant at a purchase price of U.S. $10 (the "WARRANT PURCHASE PRICE").
2. CLOSING; CLOSING DATE; DELIVERIES AT CLOSING
2.1 CLOSING; CLOSING DATE
The consummation of the transactions contemplated pursuant to this
Agreement (the "CLOSING") shall be held at the offices of Perkins Coie LLP, 1201
Third Avenue, Seattle, Washington 98101 at 10:00 a.m., Seattle time on the
Closing Date (as defined below). The parties agree that the Closing may be
effected by facsimile. The Closing shall occur on the business day immediately
following the satisfaction of the conditions set forth in Sections 5 and 6
hereof (the "CLOSING DATE").
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2.2 DELIVERY OF CERTIFICATES FOR SHARES AND WARRANTS
At the Closing, the Company shall deliver to the Purchaser one or more
stock certificates registered in the name of the Purchaser, or in such nominee
name(s) as designated by the Purchaser in writing, representing the Shares and
bearing an appropriate legend referring to the fact that the Shares were sold in
reliance upon the exemption from registration under the Securities Act of 1933,
as amended (the "SECURITIES ACT"), provided by Section 4(2) thereof and Rule 506
thereunder. The Company will deliver certificates representing the Shares
against delivery of payment of the Share Purchase Price. The Company shall
deliver to the Purchaser one certificate in the form set forth as EXHIBIT A
hereto, representing the Warrant (the "WARRANT CERTIFICATE").
2.3 DELIVERY OF CONSIDERATION
At the Closing, the Purchaser shall deliver the Share Purchase Price
and the Warrant Purchase Price to the Company by check or wire transfer of
immediately available funds to an account designated by the Company in writing
at least two business days before the Closing Date.
2.4 CONSUMMATION OF CLOSING
All acts, deliveries and confirmations comprising the Closing
regardless of chronological sequence shall be deemed to occur contemporaneously
and simultaneously upon the occurrence of the last act, delivery or confirmation
of the Closing, and none of such acts, deliveries or confirmations shall be
effective unless and until the last of same shall have occurred.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
In order to induce the Purchaser to enter into this Agreement and to
perform its obligations hereunder, the Company hereby represents and warrants to
the Purchaser, at and as of the date of this Agreement and at and as of the
Closing Date, as follows:
3.1 ORGANIZATION
The Company is a corporation duly incorporated and validly existing
under the laws of Israel. The Company has all requisite corporate power and
authority to own, operate and lease its property and to carry on its business as
now being conducted. The Company is duly qualified or licensed as a foreign
corporation to do business and is in good standing in each jurisdiction in which
the character of properties occupied, owned or held under lease by the Company,
or the nature of the business conducted by the Company, makes such qualification
or license necessary, except where the failure to be so qualified or licensed
would not have a material adverse effect on the business, operations, assets,
liabilities or financial condition of the Company and its subsidiaries taken as
a whole (a "MATERIAL ADVERSE EFFECT").
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3.2 VALID ISSUANCE
The Shares, the Warrant and the Ordinary Shares issuable upon exercise
of the Warrant (the "WARRANT SHARES" and, together with the Shares and the
Warrant, the "SECURITIES") when issued and paid for in accordance with this
Agreement or the Warrant Certificate, as the case may be, will be duly
authorized, validly issued, fully paid and nonassessable and issued in
compliance with all applicable U.S., state and foreign securities laws and will
not be subject to any preemptive or other similar rights. The Warrant Shares
have been duly and validly reserved for issuance.
3.3 AUTHORITY
The Company has all requisite corporate power and authority to enter
into this Agreement, to sell and issue the Securities and to consummate the
other transactions contemplated by this Agreement. The execution and delivery of
this Agreement, the issuance and sale of the Securities and the consummation of
the transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of the Company. This Agreement has been
duly executed and delivered by the Company, and constitutes the valid and
binding obligation of the Company, enforceable in accordance with its terms,
except to the extent limited by (i) the effect of bankruptcy, insolvency,
reorganization, receivership, conservatorship, arrangement, moratorium,
fraudulent transfer or other laws affecting or relating to the rights of
creditors generally, or (ii) the rules governing the availability of specific
performance, injunctive relief or other equitable remedies and general
principles of equity, regardless of whether arising prior to, or after, the date
hereof or considered in a proceeding in equity or at law.
3.4 NO CONFLICT
The execution and delivery by the Company of this Agreement does not,
and the sale and issuance of the Securities and consummation of the other
transactions contemplated by this Agreement will not, (a) conflict with, or
result in any violation or breach of any provision of, the charter documents of
the Company, (b) result in any violation or breach of, or constitute (with or
without notice or lapse of time, or both) a default (or give rise to a right of
termination, cancellation or acceleration of any obligation or loss of any
material benefit) under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, lease, contract or other agreement, instrument or
obligation to which the Company is a party or by which any of its properties or
assets may be bound, the violation, breach or default of which would have a
Material Adverse Effect, or (c) conflict or violate any permit, concession,
franchise, license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company or any of its properties or assets, the
conflict or violation of which would have a Material Adverse Effect.
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3.5 REQUIRED FILINGS AND CONSENTS
No consent, approval, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or commission or
other governmental authority or instrumentality ("GOVERNMENTAL ENTITY") is
required by or with respect to the Company in connection with the execution and
delivery of this Agreement, the sale and issuance of the Securities or the
consummation of the other transactions contemplated hereby or thereby, except
for such consents, approvals, orders, authorizations, registrations,
declarations and filings as (a) may be required under applicable Israeli, U.S.,
state and foreign securities and corporate laws, and (b) could not be expected
to have a Material Adverse Effect.
3.6 COMMISSION FILINGS
Attached hereto as EXHIBIT B (which EXHIBIT B may be amended before the
Closing to reflect changes from the date hereof to the Closing Date) is a true
and accurate list of all forms, reports and documents required to be filed with
or furnished to the Securities and Exchange Commission (the "COMMISSION") by the
Company since the effective date of the Registration Statement on Form F-1 filed
with respect to the Company's initial public offering pursuant to the Securities
Act and the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT")
(collectively, including all documents incorporated by reference therein, the
"COMPANY COMMISSION REPORTS"). The Company Commission Reports (a) at the time
filed, complied in all material respects with the applicable requirements of the
Securities Act and the Exchange Act, as applicable, and (b) did not at the time
they were filed (or if amended or superseded by a filing prior to the date of
this Agreement, then on the date of such filing) contain any untrue statement of
a material fact or omit 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.
3.7 FINANCIAL STATEMENTS
The consolidated financial statements of the Company and its
subsidiaries contained in the Company Commission Reports were prepared in
accordance with or reconciled to U.S. generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods indicated, and
present fairly, as of the dates and for the periods indicated, the consolidated
financial position of the Company and its subsidiaries and the consolidated
revenues and expenses, cash flows and shareholders' equity of the Company and
its subsidiaries for the periods therein set forth, subject in the case of the
unaudited consolidated financial statements to later normal, recurring audit
adjustments required by GAAP that are not in the aggregate material and to
omission of certain footnotes as permitted by GAAP.
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3.8 SHAREHOLDERS' CONSENT
No consent or approval of the shareholders of the Company is required
or necessary for the Company to enter into this Agreement, to sell and issue the
Securities or to consummate the other transactions contemplated pursuant to this
Agreement.
3.9 BROKERS OR FINDERS
The Company has not employed any broker, finder, consultant or other
intermediary that would have a valid claim against a Purchaser for a fee or
commission in connection with the transactions contemplated hereby.
3.10 LITIGATION
Except as disclosed in the Company Commission Reports, there is no
litigation, governmental proceeding, investigation or arbitration pending or, to
the knowledge of the Company, threatened against or directly involving the
Company that questions the legality or validity of this Agreement or any related
agreements or any actions taken or to be taken pursuant to or in connection with
this Agreement or any related agreements or which would reasonably be expected
to have a Material Adverse Effect.
3.11 DISCLOSURE
The representations and warranties made or contained in this Agreement
and the Company Commission Reports when taken together, do not contain any
untrue statement of a material fact and do not omit to state a material fact
required to be stated herein or therein or necessary in order to make such
representations and warranties and other material not misleading. There have
been no events or transactions or information that have come to the attention of
the executive officers of the Company having a direct impact on the Company or
its assets, liabilities, financial condition, business, results of operations or
prospects which, in the reasonable judgment of such management, could be
expected to have a Material Adverse Effect.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
In order to induce the Company to enter into this Agreement and to
perform its obligations hereunder, the Purchaser hereby represents and warrants
to the Company, at and as of the date of this Agreement and at and as of the
Closing Date, as follows:
4.1 ORGANIZATION
The Purchaser is a corporation duly incorporated and validly existing
under the laws of the state of Washington.
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4.2 AUTHORITY
The Purchaser has all requisite corporate power and authority to enter
into this Agreement, to purchase and hold the Securities and to consummate the
other transactions to be consummated by the Purchaser contemplated by this
Agreement. The execution and delivery of this Agreement, the purchase of the
Securities and the consummation of the other transactions contemplated by this
Agreement have been duly authorized by all necessary corporate action on the
part of the Purchaser. This Agreement has been duly executed and delivered by
the Purchaser, and constitutes the valid and binding obligation of the
Purchaser, enforceable in accordance with its terms, except to the extent
limited by (i) the effect of bankruptcy, insolvency, reorganization,
receivership, conservatorship, arrangement, moratorium, fraudulent transfer or
other laws affecting or relating to the rights of creditors generally, or (ii)
the rules governing the availability of specific performance, injunctive relief
or other equitable remedies and general principles of equity, regardless of
whether arising prior to, or after, the date hereof or considered in a
proceeding in equity or at law.
4.3 NO CONFLICT
The execution and delivery by the Purchaser of this Agreement does not,
and consummation of the transactions contemplated by this Agreement will not
conflict with, or result in any violation or breach of any provision of, the
charter documents of the Purchaser.
4.4 REQUIRED FILINGS AND CONSENTS
No consent, approval, order or authorization of, or registration,
declaration or filing with, any Governmental Entity is required by or with
respect to the Purchaser in connection with the execution and delivery of this
Agreement, the purchase of the Securities to be purchased by the Purchaser or
the consummation of the other transactions to be consummated by the Purchaser
contemplated hereby, except for such consents, authorizations, filings,
approvals and registrations which, if not obtained or made, could not be
expected to have a material adverse effect on the Purchaser's ability to
consummate the transactions contemplated pursuant to this Agreement.
4.5 PURCHASER IS AN "ACCREDITED INVESTOR"
The Purchaser is an "accredited investor" as defined in Rule 501(a)
under the Securities Act. The Purchaser believes that it has received all the
information it considers necessary or appropriate for deciding whether to
purchase the Securities. The Purchaser further represents that it has had an
opportunity to ask questions and receive answers from the Company regarding the
terms and conditions of the Securities and the business, properties, prospects
and financial condition of the Company; provided, however, that the foregoing
shall not diminish or detract from the Purchaser's ability to rely upon any of
the Company's representations or warranties. The Purchaser acknowledges that it
is able to fend for itself, can bear the economic risk of its investment, and
has such knowledge and
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experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment in the Securities. The Securities will be
acquired for the Purchaser's own account and not with a view to the resale or
distribution of any portion thereof in violation of the Securities Act. The
Purchaser has no present intention of transferring, selling or otherwise
distributing the Securities and is not a party to any agreement or arrangement
to sell or otherwise transfer any of the Securities to any person.
4.6 BROKERS OR FINDERS
The Purchaser has not employed any broker, finder, consultant or other
intermediary that would have a valid claim against the Company for a fee or
commission in connection with the transactions contemplated hereby.
4.7 RESTRICTED SECURITIES
The Purchaser understands that unless the Securities are registered
under applicable securities laws, the Securities will be "restricted securities"
under U.S. securities laws and that under such laws and applicable regulations
such Securities may be resold without registration under the Securities Act only
in certain limited circumstances, including pursuant to Rule 144 under the
Securities Act, or any successor rule thereto ("Rule 144"). Unless a transfer of
Securities is made to a subsidiary of the Purchaser or in accordance with an
effective registration statement under the Securities Act, the Purchaser shall
not transfer any Securities unless it shall furnish the Company with an opinion
of counsel, in form and substance reasonably satisfactory to the Company, that
such disposition will not require registration of such Securities under the
Securities Act; provided, however, such opinion will not be required in
connection with a transfer in compliance with Rule 144 or to a subsidiary of the
Purchaser.
4.8 LEGENDS
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE OR FOREIGN
SECURITIES LAWS, AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED,
PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT AND APPLICABLE STATE OR FOREIGN SECURITIES LAWS
COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) THE COMPANY
RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THE SECURITIES
SATISFACTORY TO THE COMPANY STATING THAT SUCH TRANSACTION IS EXEMPT FROM
REGISTRATION, (C) SUCH TRANSACTION IS IN COMPLIANCE WITH RULE 144 OF THE
SECURITIES ACT, OR (D) THE COMPANY OTHERWISE SATISFIES ITSELF THAT SUCH
TRANSACTION IS EXEMPT FROM REGISTRATION.
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Notwithstanding the foregoing, the Purchaser shall have the right, upon
written request to the Company on or after termination of all applicable
limitations on transfer with respect to any Securities, to receive from the
Company, without expense, a new certificate omitting any legend with respect to
the terminated limitations.
5. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER
The obligations of the Purchaser pursuant to Sections 1 and 2 of this
Agreement are subject to the fulfillment on or prior to the Closing Date of the
following conditions, each of which may be waived in whole or part by the
Purchaser:
5.1 REPRESENTATIONS AND WARRANTIES
The representations and warranties made by the Company pursuant to this
Agreement shall have been true and correct in all respects, in the case of any
representation made without qualification, or in the case of any representations
made containing materiality qualifications, in all material respects, when made,
and shall be true and correct in all respects, in the case of any representation
made without qualification, or in the case of any representations made
containing materiality qualifications, in all material respects, on the Closing
Date with the same force and effect as if they had been made on and as of such
date.
5.2 COVENANTS
The Company shall have performed in all material respects all
obligations and conditions herein required to be performed or observed by it on
or prior to the Closing Date.
5.3 CLOSING CERTIFICATE
The President or Chief Financial Officer of the Company shall deliver
to the Purchaser at the Closing a certificate certifying that the conditions
specified in Sections 5.1 and 5.2 have been fulfilled and stating that there
shall have been no material adverse change in the business, operations,
properties, assets or financial condition of the Company since the date of this
Agreement.
5.4 NO INJUNCTION OR LITIGATION
As of the Closing Date, there shall not be any claim or judgment of any
nature or type threatened, pending or made by or before any Governmental Entity
that questions or challenges the lawfulness of the transactions contemplated by
this Agreement under any law or regulation or seeks to delay, restrain or
prevent such transactions.
5.5 GOVERNMENT APPROVALS
All consents, approvals or authorizations of, and declarations, filings
or registrations with, all Governmental Entities required for the consummation
of the transactions
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contemplated in Sections 1 and 2 of this Agreement shall have been obtained or
made on terms reasonably satisfactory to the Purchaser and shall be in full
force and effect.
5.6 LEGAL OPINION
The Company shall have delivered to the Purchaser opinions of counsel,
dated the Closing Date, covering the matters set forth on EXHIBIT C hereto.
5.7 NASDAQ LISTING
The Company shall have filed a Notification For Listing of Additional
Shares with Nasdaq covering the Securities.
5.8 ISRAELI INVESTMENT CENTER APPROVAL
All required consents to the sale of the Securities will have been
received from the Israeli Investment Center.
6. CONDITIONS TO THE COMPANY'S OBLIGATIONS
The obligation of the Company pursuant to Sections 1 and 2 of this
Agreement are subject to the fulfillment on or prior to the Closing Date of each
of the following conditions, each of which may be waived in whole or part by the
Company:
6.1 REPRESENTATIONS AND WARRANTIES
The representations and warranties of the Purchaser pursuant to this
Agreement shall have been true and correct when made, and shall be true and
correct on the Closing Date with the same force and effect as if they had been
made on and as of such date.
6.2 COVENANTS
The Purchaser shall have performed all obligations and conditions
herein required to be performed or observed by the Purchaser on or prior to the
Closing Date.
6.3 NO INJUNCTION OR LITIGATION
As of the Closing Date, there shall not be any claim or judgment of any
nature or type threatened, pending or made by or before any Governmental Entity
that questions or challenges the lawfulness of the transactions contemplated by
this Agreement under any law or regulation or seeks to delay, restrain or
prevent such transactions.
6.4 GOVERNMENT APPROVALS
All consents, approvals or authorizations of, and declarations, filings
or registrations with, all Governmental Entities required for the consummation
of the transactions
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contemplated in Sections 1 and 2 of this Agreement shall have been obtained or
made on terms reasonably satisfactory to the Company and shall be in full force
and effect.
6.5 SECURITIES LAWS QUALIFICATION
The offer and sale to the Purchaser of the Securities pursuant to this
Agreement shall be qualified or exempt from qualification under all applicable
U.S., state and foreign securities laws, which qualifications and exemptions
under Section 4(2) and Regulation D the Company shall use commercially
reasonable efforts to obtain (at the Company's expense) as promptly as
practicable; provided, however, that nothing herein shall be deemed to cause the
Company to incur any obligation to register the Securities under the Securities
Act.
7. CERTAIN COVENANTS
7.1 NONDISCLOSURE
Whether or not the Closing under this Agreement occurs, the Company and
the Purchaser will protect the Confidential Information (as defined below) of
the other party from misappropriation and unauthorized use or disclosure, and at
a minimum, will take precautions at least as great as those taken to protect its
own confidential information of a similar nature. Without limiting the
foregoing, the Receiving Party (as defined below) will: (a) use such
Confidential Information solely for the purposes for which it has been
disclosed; and (b) disclose such Confidential Information only to those of its
employees, agents, consultants, and others who have a need to know the same for
the purpose of performing this Agreement and who are informed of and agree to a
duty of nondisclosure. The Receiving Party may also disclose Confidential
Information of the Disclosing Party (as defined below) to the extent necessary
to comply with applicable law or legal process, provided that the Receiving
Party uses reasonable efforts to give the Disclosing Party prompt advance notice
thereof. Upon request of the other party, each party shall return to the other
all materials, in any medium, which contain, embody, reflect or reference all or
any part of any Confidential Information of the other party.
For the purposes of this Section 7.1, the following terms have the
following meanings:
"CONFIDENTIAL INFORMATION" means non-public information and know-how of
the Disclosing Party which, by the nature of the circumstances surrounding
disclosure, ought in good faith to be treated as proprietary and/or
confidential, or which has been or is designated as proprietary and/or
confidential. Confidential Information does not include information that the
Receiving Party can show: (a) was known by the Receiving Party prior to
disclosure thereof by the Disclosing Party; (b) was in or entered the public
domain through no fault of the Receiving Party; or (c) is independently
developed by the Receiving Party without reference to any Confidential
Information of the Disclosing Party.
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"DISCLOSING PARTY" means a party that discloses Confidential
Information to the other party in connection with this Agreement.
"RECEIVING PARTY" means a party that receives Confidential Information
from the other party in connection with this Agreement.
7.2 CONFIDENTIALITY; PUBLICITY
Neither the Company nor the Purchaser shall issue any press release or
other public announcement regarding, or otherwise disclose, this Agreement or
the transactions contemplated herein, or make any filing of this Agreement or
other agreements relating to the transactions contemplated herein, without the
consent of the other; provided, however, that if a party is required by
applicable law to provide public disclosure of this Agreement or the
transactions contemplated herein, such party shall use all reasonable efforts to
coordinate the disclosure with the other party before issuance, including, but
not limited to the submission to the Commission (and any other applicable
regulatory or judicial authority) of an application for confidential treatment
of certain terms (which terms shall be agreed upon by the Purchaser and the
Company) of this Agreement. Except for the initial announcement as to the
execution of this Agreement (which announcement shall nonetheless be subject to
the provisions specified above in this Section 7.2), each party shall provide to
the other for review a copy of any proposed disclosure of this Agreement or its
terms and any application for confidential treatment at least five (5) business
days before any such disclosure or application is made.
7.3 COVENANTS TO SATISFY CONDITIONS
Each of the Company and the Purchaser shall use commercially reasonable
efforts to satisfy or cause to be satisfied all of the conditions precedent to
the other party's obligations that are set forth in Section 5 or Section 6, as
the case may be.
7.4 FURTHER ASSURANCES
Each party agrees from time to time to do and perform such other and
future acts and execute and deliver any and all such other instruments as may be
required by law or reasonably requested by the other party to establish,
maintain or protect the rights and remedies of the requesting party or to carry
out and effect the intent and purpose of this Agreement.
8. MISCELLANEOUS
8.1 GOVERNING LAW
This Agreement shall be governed by, and construed in accordance with,
the laws of the state of California applicable to contracts executed in and to
be performed in that state.
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8.2 SURVIVAL
Except as otherwise provided herein, the representations, warranties,
covenants and agreements made herein shall survive the closing of the
transactions contemplated hereby.
8.3 SUCCESSORS AND ASSIGNS
Except as otherwise expressly provided herein, the provisions hereof
shall inure to the benefit of, and be binding upon, the successors, assigns,
heirs, executors and administrators of the parties hereto. It is expressly
acknowledged that the Purchaser may assign its rights hereunder to any affiliate
(as such term is defined in Rule 144 of the Securities Act) thereof; provided,
however, that such affiliate agrees in writing to be bound to the terms hereof
and to make the representations and warranties contained in Article 4 hereof on
its own behalf.
8.4 ENTIRE AGREEMENT
This Agreement and the other documents referred to herein constitute
the full and entire understanding and agreement between the parties with regard
to the subjects hereof and thereof.
8.5 AMENDMENT; WAIVER
Any term of this Agreement may be amended and the observance of any
term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the Company and the Purchaser.
8.6 DELAYS OR OMISSIONS
No delay or omission to exercise any right, power or remedy accruing to
any holder of any of the Securities, upon any breach or default of the Company
under this Agreement, shall impair any such right, power or remedy of such
holder nor shall it be construed to be a waiver of any such breach or default,
or an acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
holder of any breach or default under this Agreement, or any waiver on the part
of any holder of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All remedies either under this Agreement or by law or otherwise
afforded to any holder, shall be cumulative and not alternative.
8.7 NOTICES AND OTHER COMMUNICATIONS
Unless otherwise provided, any notice under this Agreement shall be
given in writing and shall be deemed effectively given (a) upon personal
delivery to the party to be notified, (b) upon confirmation of receipt by
facsimile by the party to be notified, (c) two business
-12-
<PAGE> 13
days after deposit with a reputable overnight courier, prepaid for overnight
delivery and addressed as set forth in (d), or (d) five days after deposit with
the United States Post Office or a postal office in the state of Israel, postage
prepaid, registered or certified with return receipt requested and addressed to
the party to be notified at the address indicated below, or at such other
address as such party may designate by 10 days' advance written notice to the
other party given in the foregoing manner.
To the Company: c/o BackWeb Technologies Inc.
2077 Gateway Place, Suite 500
San Jose, CA 95110
Attn: General Counsel
Facsimile: (408) 933-1800
With copies to: Brobeck, Phleger & Harrison LLP
One Market Plaza
Spear Street Tower
San Francisco, CA 94105
Attn: Donald J. Bouey
Facsimile: (415) 442-1010
To the Purchaser: RealNetworks, Inc.
2601 Elliot Avenue
Seattle, Washington 98121
Attn: General Counsel
Facsimile: (206) 674-2695
With a copy to: Perkins Coie LLP
1201 Third Avenue
Seattle, Washington 98101
Attn.: Scott L. Gelband
Facsimile: (206) 583-8500
or at such other address as the intended recipient previously shall have
designated by written notice to the other party (with copies to counsel as may
be indicated on the signature page). Notice by registered or certified mail
shall be effective on the date it is officially recorded as delivered to the
intended recipient by return receipt or equivalent, and in the absence of such
record of delivery, the effective date shall be the fifth business day after it
was deposited in the mail. All notices delivered in person or sent by courier
shall be effective on the date of personal delivery; notices delivered by
facsimile with simultaneous confirmation copy by registered or certified mail
shall be effective on the date sent. Notice not given in writing
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<PAGE> 14
shall be effective only if acknowledged in writing by a duly authorized
representative of the party to whom it was given.
8.8 SPECIFIC PERFORMANCE
Each of the parties hereto acknowledges and agrees that the other party
hereto would be damaged irreparably in the event any of the provisions of this
Agreement are not performed in accordance with their specific terms or otherwise
are breached. Accordingly, each of the parties hereto agrees the other party
hereto will be entitled to an injunction to prevent breaches of the provisions
of this Agreement and to enforce specifically this Agreement and the terms and
provisions of this Agreement in any competent court having jurisdiction over the
parties, in addition to any other remedy to which they might be entitled at law
or in equity. In any such action specifically to enforce any such term or
provision of this Agreement, the parties hereby waive any claim or defense
therein that an adequate remedy at law or in damages exists.
8.9 SEVERABILITY OF THIS AGREEMENT
In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby. Furthermore the
court shall have the power to replace the invalid or unenforceable part or
provision with a provision that accomplishes, to the extent possible, the
original business purpose of such part or provision in a valid and enforceable
manner. Such replacement shall apply only with respect to the particular
jurisdiction in which the adjudication is made.
8.10 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument. Execution and delivery of this Agreement by exchange of facsimile
copies bearing the facsimile signature of a party hereto shall constitute a
valid and binding execution and delivery of this Agreement by such party. Such
facsimile copies shall constitute enforceable original documents.
8.11 NO THIRD-PARTY RIGHTS
Nothing in this Agreement is intended, nor shall be construed, to
confer upon any person or entity other than the parties and their respective
successors and assigns any right or remedy under or by reason of this Agreement,
except as expressly provided in this Agreement.
8.12 NO AGENCY, ETC.
None of the provisions of this Agreement shall be construed to mean
that any party is appointed or is in any way authorized to act as an agent of
any other party. This Agreement
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<PAGE> 15
does not constitute, create, give effect to, or otherwise recognize a joint
venture, partnership, or formal business organization of any kind.
8.13 CONSTRUCTION OF AGREEMENT
This Agreement has been negotiated by the parties and their attorneys,
and the language hereof shall not be construed for or against any party. The
titles and headings herein are for reference purposes only and shall not in any
manner limit the construction of this Agreement, which shall be considered as a
whole.
8.14 TERMINATION
This Agreement may be terminated as follows:
(a) The Purchaser may terminate this Agreement in the event that the
conditions set forth in Section 5 have not been satisfied or waived on or before
February 29, 2000;
(b) The Company may terminate this Agreement in the event that the
conditions set forth in Section 6 have not been satisfied or waived on or before
February 29, 2000;
No termination pursuant to this Section 8.14 shall relieve any party of
liability for breach of this Agreement prior to such termination.
Either the Company or the Purchaser may terminate this Agreement if the
other (a) has a receiver or administrative receiver appointed for it or over its
undertakings or assets, (b) passes a resolution for winding up or a court of
competent jurisdiction makes an order to that effect and such order is not
discharged within ninety (90) days, (c) enters into any voluntary arrangement
with its creditors for the benefit of its creditors, (d) becomes subject to an
administration order, or (e) ceases to carry on business.
8.15 ATTORNEYS' FEES
If any action or proceeding shall be commenced to enforce this
Agreement or any right arising in connection with this Agreement, the prevailing
party in such action or proceeding shall be entitled to recover from the other
party, the reasonable attorneys' fees, costs and expenses incurred by such
prevailing party in connection with such action or proceeding or negotiation to
avoid such action or proceeding.
[Remainder of page intentionally left blank.]
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<PAGE> 16
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
BACKWEB TECHNOLOGIES LTD.
/s/ Eli Barkat
Its: Chief Executive Officer
-------------------------------------
REALNETWORKS, INC.
/s/ Paul Bialek
Its: Chief Financial Officer
-------------------------------------
<PAGE> 17
EXHIBIT A - FORM OF WARRANT
<PAGE> 18
EXHIBIT B - LIST OF COMPANY COMMISSION REPORTS
<TABLE>
<CAPTION>
<S> <C> <C>
424B4 Prospectus Filed Pursuant to Rule 424 12/9/99
6-K Report of Foreign Issuer 11/17/99
6-K Report of Foreign Issuer 8/19/99
S-8 Registration Statement 8/6/99
424B4 Prospectus Filed Pursuant to Rule 424 6/21/99
</TABLE>
<PAGE> 19
EXHIBIT C - FORM OF LEGAL OPINION
1. The Company is a corporation duly incorporated and validly existing
under the laws of the state of Israel.
2. The Company has the requisite corporate power and authority to
execute, deliver and perform this Agreement and the Warrant. The Agreement and
the Warrant have been duly and validly authorized, executed and delivered by the
Company and constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their respective terms. All
corporate action on the part of the Company and its officers, directors and
shareholders necessary for the authorization, execution and delivery of the
Agreement and the Warrant and the authorization, issuance and delivery of the
Securities being sold thereunder has been taken.
3. The Securities have been duly authorized for issuance and sale to
the Purchaser pursuant to this Agreement and, when issued and delivered by the
Company pursuant to this Agreement against payment of the consideration set
forth therein, will be validly issued and fully paid and nonassessable; and the
issuance of the Securities are not subject to preemptive or, to such counsel's
knowledge, other rights to subscribe for or purchase securities.
4. The execution, delivery and performance by the Company of the
Agreement does not conflict with or result in a violation of the Articles of
Association of the Company or any material judgment, order or decree of any
court or arbitrator, known to us, to which the Company is a party or is subject.
5. Other than pursuant to federal and state securities laws and
regulations, all consents, approvals, orders or authorizations of, and all
qualifications, registrations, designations, declarations or filings with, any
federal or state governmental authority on the part of the Company required in
connection with the sale of the Securities to the Purchaser have been obtained,
or will be effective, as of the Closing.
6. Based upon the Purchaser's representations and warranties contained
in this Agreement, the sale of the Securities to the Purchaser pursuant to the
terms of this Agreement do not require registration under Section 5 of the
Securities Act.
7. We have not been engaged to give substantive attention to, or
represent the Company in connection with, nor to our knowledge is there, any
litigation, governmental proceeding, investigation or arbitration pending or
threatened against or directly involving the Company that questions the legality
or validity of the Agreement or the Warrant or any actions taken or to be taken
pursuant to or in connection with the Agreement or the Warrant.
Very truly yours,
<PAGE> 1
EXHIBIT 10.2
THE SECURITIES EVIDENCED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE OR FOREIGN SECURITIES
LAWS, AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT
UNDER SUCH ACT AND APPLICABLE STATE OR FOREIGN SECURITIES LAWS COVERING ANY SUCH
TRANSACTION INVOLVING SAID SECURITIES, (B) THE COMPANY RECEIVES AN OPINION OF
LEGAL COUNSEL FOR THE HOLDER OF THE SECURITIES SATISFACTORY TO THE COMPANY
STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION, (C) SUCH TRANSACTION
IS IN COMPLIANCE WITH RULE 144 OF THE ACT, OR (D) THE COMPANY OTHERWISE
SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION.
No. W
Issued: January 28, 2000 Warrant to Purchase Ordinary
Void After June 28, 2001 Shares
BACKWEB TECHNOLOGIES LTD.
WARRANT
THIS IS TO CERTIFY that, for $10 and other value received and subject
to these terms and conditions, RealNetworks, Inc, a Washington corporation, or
such person to whom this Warrant is transferred (the "HOLDER"), is entitled to
exercise this Warrant to purchase from BackWeb Technologies Ltd., an Israeli
corporation (the "COMPANY"), 114,500 fully paid and nonassessable Ordinary
Shares (the "WARRANT SHARES") at a price per share of U.S. $32.75 (the "EXERCISE
PRICE") (such number of shares, type of security and the Exercise Price being
subject to adjustment as provided below). The Exercise Price is equal to the
average NASDAQ National Market closing price of the Company's Ordinary Shares
for the 60 trading days before January 14, 2000.
1. METHOD OF EXERCISE
1.1 CASH EXERCISE RIGHT
This Warrant may be exercised by the Holder, at any time until June 28, 2001
(the "EXERCISE PERIOD"), in whole or in part, by delivering to the Company at
c/o BackWeb Technologies Inc., 2077 Gateway Place, Suite 500, San Jose, CA 95110
(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) (a) this Warrant certificate, (b) a certified or cashier's check
payable to the Company or a wire transfer in the amount of
<PAGE> 2
the Exercise Price multiplied by the number of shares for which this Warrant is
being exercised (the "PURCHASE PRICE"), (c) the Notice of Cash Exercise attached
as EXHIBIT A duly completed and executed by the Holder and (d) the Investment
Representations attached as EXHIBIT C duly completed and executed by the Holder.
1.2 NET ISSUANCE RIGHT
Notwithstanding the payment provisions set forth above, the Holder may
elect to convert this Warrant into Warrant Shares by surrendering this Warrant
at the office of the Company at the address set forth in Section 1.1 and
delivering to the Company the Notice of Net Issuance Exercise attached as
EXHIBIT B duly completed and executed by the Holder (together with the
Investment Representations attached as EXHIBIT C duly completed and executed by
the Holder, in which case the Company shall issue to the Holder the number of
Warrant Shares of the Company equal to the result obtained by (a) subtracting B
from A, (b) multiplying the difference by C, and (c) dividing the product by A
as set forth in the following equation:
X = (A - B) x C where:
-----------
A
X = the number of Warrant Shares issuable upon net
issuance exercise pursuant to the provisions of this
Section 1.2.
A = the Daily Price (as defined below) of one Warrant
Share on the day immediately preceding the date on
which the Holder delivers written notice to the
Company pursuant to this Section 1.2.
B = the Exercise Price for one Warrant Share under this
Warrant.
C = the number of Warrant Shares as to which this
Warrant is exercisable pursuant to the provisions of
Section 1.1.
If the foregoing calculation results in a negative number, then no
Warrant Shares shall be issued upon net issuance exercise pursuant to this
Section 1.2.
"DAILY PRICE" of a Warrant Share shall mean:
(a) If the Company's Ordinary Shares are listed and traded on the New
York Stock Exchange, Inc. ("NYSE"), the closing price on such day as reported on
the NYSE Composite Transactions Tape;
(b) If the Company's Ordinary Shares are not listed and traded on the
NYSE, the closing price on such day as reported by the principal national
securities exchange on which the Ordinary Shares are listed and traded;
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<PAGE> 3
(c) If the Company's Ordinary Shares are not listed and traded on any
such securities exchange, the last reported sale price on such day on the
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ");
(d) If the Company's Ordinary Shares are not traded on the NASDAQ
National Market, but are traded in the over-the-counter market, the average of
the closing bid and asked prices reported on such day; and
(e) If none of the above is applicable, the Daily Price shall be the
fair market value of the Ordinary Shares as determined in good faith by the
Company's Board of Directors.
Notwithstanding any of the foregoing, if the Holder disagrees with the
determination by the Board of Directors of the fair market value, if applicable,
the fair market value shall be determined by a nationally recognized investment
banking firm (i) which does not (and whose directors, officers, employees and
affiliates do not) have a direct or indirect financial interest in the Company,
(ii) which has not been, and, at the time it is called upon to give independent
financial advice to the Company, is not (and none of whose directors, officers,
employees or affiliates is) a promoter, director or officer of the Company or
any of its affiliates or an underwriter with respect to any of the Company's
securities, (iii) which does not provide any advice or opinions to the Company
except as an independent financial expert and (iv) which is mutually agreeable
to the Company and the Holder (the "INDEPENDENT FINANCIAL EXPERT"). If the
Company and the Holder do not promptly agree as to the Independent Financial
Expert, each shall appoint one investment-banking firm and the two firms so
appointed shall select the Independent Financial Expert to be employed by the
Company. All fees and expenses of the Independent Financial Expert for opinions
and services it provides as an Independent Financial Expert shall be paid by the
Company. In making its determination of the value of the Ordinary Shares, the
Independent Financial Expert shall use one or more valuation methods that the
Independent Financial Expert, in its best professional judgment, determines to
be most appropriate. After the Independent Financial expert has made its
determination, the Company shall cause the Independent Financial Expert to
prepare and make available to the Holder a report stating the methods of
valuation considered or used and the value of the Common Stock or other security
it values and containing a statement as to the nature and scope of the
examination made.
2. DELIVERY OF STOCK CERTIFICATES; NO FRACTIONAL SHARES
2.1 Within 10 days after the payment of the Purchase Price following the
exercise of this Warrant (in whole or in part) or after notice of net issuance
exercise and compliance with Section 1.2, the Company at its expense shall issue
in the name of and deliver to the Holder (a) a certificate or certificates for
the number of fully paid and nonassessable Warrant Shares to which the Holder
shall be entitled upon such exercise, and (b) a new Warrant of like tenor to
purchase up to that number of Warrant Shares, if any, as to which this Warrant
has not been exercised if this Warrant has not expired. The Holder shall for all
purposes be deemed to have become the holder of record of such Warrant Shares on
the date this Warrant
-3-
<PAGE> 4
was exercised (the date the Holder has fully complied with the requirements of
Section 1.1 or 1.2), irrespective of the date of delivery of the certificate or
certificates representing the Warrant Shares; provided that, if the date such
exercise is made is a date when the stock transfer books of the Company are
closed, such person shall be deemed to have become the holder of record of such
Warrant Shares at the close of business on the next succeeding date on which the
stock transfer books are open.
2.2 No fractional shares shall be issued upon the exercise of this
Warrant. In lieu of fractional shares, the Company shall pay the Holder a sum in
cash equal to the Daily Price of the fractional share on the date of exercise.
3. COVENANTS AS TO WARRANT SHARES
The Company covenants that at all times during the Exercise Period
there shall be reserved for issuance and delivery upon exercise of this Warrant
such number of Warrant Shares as is necessary for exercise in full of this
Warrant and, from time to time, it will take all steps necessary to provide
sufficient reserves of Warrant Shares.
4. ADJUSTMENTS UPON CERTAIN EVENTS
Upon a merger, consolidation, acquisition of all or substantially all
of the property or stock, liquidation or other reorganization of the Company
(collectively, a "REORGANIZATION") during the Exercise Period lawful provision
shall be made so that the Holder shall thereafter be entitled to receive, upon
exercise of this Warrant, the number of shares of securities of the successor
corporation resulting from such Reorganization (and cash and other property), to
which a holder of the Warrant Shares issuable upon exercise of this Warrant
would have been entitled in such Reorganization if this Warrant had been
exercised immediately prior to such Reorganization. In any such case,
appropriate adjustment (as determined in good faith by the Company's Board of
Directors) shall be made in the application of the provisions of this Warrant
with respect to the rights and interest of the Holder after the Reorganization
to the end that the provisions of this Warrant (including adjustments of the
Exercise Price and the number and type of securities purchasable pursuant to the
terms of this Warrant) shall be applicable after that event, as near as
reasonably may be, in relation to any shares deliverable after that event upon
the exercise of this Warrant.
4.2 ADJUSTMENTS FOR STOCK SPLITS, DIVIDENDS
If the Company shall subdivide the number of outstanding shares of the
same class as the Warrant Shares into a greater number of shares, then the
Exercise Price in effect before such dividend or subdivision shall be
proportionately reduced and the number of Warrant Shares at that time issuable
pursuant to the exercise of this Warrant shall be proportionately increased;
and, conversely, if the Company shall contract the number of outstanding shares
of the same class as the Warrant Shares by combining such shares into a smaller
number of shares, then the Exercise Price in effect before such combination
shall be proportionately increased and the number of Warrant Shares at that time
issuable pursuant to the exercise or
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<PAGE> 5
conversion of this Warrant shall be proportionately decreased. Each adjustment
in the number of Warrant Shares issuable shall be to the nearest whole share.
4.3 CERTIFICATE AS TO ADJUSTMENTS
In the case of any adjustment in the Exercise Price or number and type
of securities issuable upon exercise of this Warrant, the Company will promptly
give written notice to the Holder in the form of a certificate, certified and
confirmed by an officer of the Company, setting forth the adjustment in
reasonable detail.
5. SECURITIES LAWS RESTRICTIONS; LEGEND ON WARRANT SHARES
5.1 This Warrant and the securities issuable upon exercise have not
been registered under the Securities Act of 1933, as amended (the "ACT"), or
applicable state or foreign securities laws, and no interest may be sold,
distributed, assigned, offered, pledged or otherwise transferred to any entity
other than a subsidiary of the Holder unless (a) there is an effective
registration statement under such Act and applicable state and foreign
securities laws covering any such transaction involving said securities, (b) the
Company receives an opinion of legal counsel for the holder of the securities
satisfactory to the Company stating that such transaction is exempt from
registration, (c) such transaction is in compliance with Rule 144 of the Act, or
(d) the Company otherwise satisfies itself that such transaction is exempt from
registration.
5.2 A legend setting forth or referring to the above restrictions shall
be placed on this Warrant, any replacement and any certificate representing the
Warrant Shares, and a stop transfer order shall be placed on the books of the
Company and with any transfer agent until such securities may be legally sold or
otherwise transferred.
6. EXCHANGE OF WARRANT; LOST OR DAMAGED WARRANT CERTIFICATE
This Warrant is exchangeable upon its surrender by the Holder at the
office of the Company. Upon receipt by the Company of satisfactory evidence of
the loss, theft, destruction or damage of this Warrant and either (in the case
of loss, theft or destruction) reasonable indemnification or (in the case of
damage) the surrender of this Warrant for cancellation, the Company will execute
and deliver to the Holder, without charge, a new Warrant of like denomination.
7. NOTICES OF RECORD DATE, ETC.
In the event of
(a) any taking by the Company of a record of the holders of Warrant
Shares for the purpose of determining the holders who are entitled to receive
any dividend or other distribution, or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right;
-5-
<PAGE> 6
(b) any reorganization of the Company, any reclassification or
recapitalization of the capital structure of the Company, or any transfer of all
or substantially all the assets of the Company to, or consolidation or merger
of, the Company with or into any person;
(c) any voluntary or involuntary dissolution, liquidation or winding-up
of the Company;
(d) any proposed issue or grant by the Company to the holders of
Warrant Shares of any shares of any class or any other securities, or any right
or warrant to subscribe for, purchase or otherwise acquire any units of any
class or any other securities; or
(e) any other event as to which the Company is required to give notice
to any holders of Warrant Shares,
then and in each such event the Company will mail to the Holder a notice
specifying (i) the date on which any such record is to be taken, (ii) the date
on which any such reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up is to take place,
and the time, if any is to be fixed, as to which the holders of record of
Warrant Shares or securities into which the Warrant Shares are convertible shall
be entitled to exchange their shares for securities or other property
deliverable on such reorganization, reclassification, recapitalization,
transfer, consolidation, merger, dissolution, liquidation or winding-up, (iii)
the amount and character of any stock or other securities, or rights or
warrants, proposed to be issued or granted, the date of such proposed issue or
grant and the persons or class of persons to whom such proposed issue or grant
is to be offered or made, and (iv) in reasonable detail, the facts, including
the proposed date, concerning any other such event. Such notice shall be
delivered to the Holder at least 20 business days prior to the date specified in
the notice.
8. REPRESENTATIONS AND WARRANTIES OF THE HOLDER
The Holder is an accredited investor as defined in Rule 501(a) of
Regulation D promulgated under the Act.
The Holder is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire this Warrant and the Warrant
Shares. The Holder is acquiring this Warrant and the Warrant Shares issuable
upon exercise thereof for its own account, to hold for investment, and not with
a view to or for sale in connection with any distribution thereof in violation
of the Act, and, upon any exercise of this Warrant, the Holder shall confirm the
same in writing, by executing the form attached as EXHIBIT C hereto. The Holder
shall not make any sale, transfer or other disposition of this Warrant or any
Warrant Shares issuable upon exercise thereof in violation of the Act or the
General Rules and Regulations promulgated thereunder by the Securities and
Exchange Commission (the "SEC") or in violation of any applicable state or
foreign securities law.
-6-
<PAGE> 7
The Holder has been advised that this Warrant, and the Warrant Shares
issuable upon exercise thereof, have not been registered under the Act or state
or foreign securities laws in reliance upon an exemption from registration, and
that reliance by the Company on such exemptions is predicated in part on
Holder's representations set forth herein.
The Holder has been informed that under the Act, this Warrant and the
Warrant Shares issuable upon conversion thereof must be held indefinitely unless
subsequently registered under the Act or unless an exemption from such
registration (such as Rule 144) is available with respect to any proposed
transfer or disposition by the Holder. The Holder further agrees that the
Company may refuse to permit the Holder to sell, transfer or dispose of this
Warrant, and the Warrant Shares issuable upon conversion thereof (except as
permitted under Rule 144) unless there is in effect a registration statement
under the Act and any applicable state or foreign securities laws covering such
transfer, or unless the Holder furnishes an opinion of counsel reasonably
satisfactory to counsel for the Company, to the effect that such registration is
not required; provided, however, such opinion will not be required in connection
with a transfer in compliance with Rule 144 or to a subsidiary of the Purchaser.
9. MISCELLANEOUS
9.1 HOLDER AS OWNER
The Company may deem and treat the holder of record of this Warrant as
the absolute owner for all purposes regardless of any notice to the contrary.
9.2 NO SHAREHOLDER RIGHTS
This Warrant shall not entitle the Holder to any voting rights or any
other rights as a shareholder of the Company or to any other rights except the
rights stated herein; and no dividend or interest shall be payable or shall
accrue in respect of this Warrant or the Warrant Shares, until this Warrant is
exercised.
9.3 NOTICES
Unless otherwise provided, any notice under this Warrant shall be given
in writing and shall be deemed effectively given (a) upon personal delivery to
the party to be notified, (b) upon confirmation of receipt by fax by the party
to be notified, (c) two business days after deposit with a reputable overnight
courier, prepaid for overnight delivery and addressed as set forth in (d), or
(d) five days after deposit with the United States Post Office or any foreign
postal service, postage prepaid, registered or certified with return receipt
requested and addressed to the party to be notified at the address indicated
below, or at such other address as such party may designate by 10 days' advance
written notice to the other party given in the foregoing manner.
-7-
<PAGE> 8
If to the Holder:
To the address last furnished
in writing to the Company by
the Holder
If to the Company:
BackWeb Technologies Ltd.
c/o BackWeb Technologies Inc.
2077 Gateway Place, Suite 500
San Jose, CA 95110
Attn: General Counsel
Facsimile: (408) 933-1800
Phone: (408) 933-1763
9.4 AMENDMENTS AND WAIVERS
Any term of this Warrant may be amended and the observance of any term
may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of the Company and
the Holder. Any amendment or waiver effected in accordance with this Section 9.4
shall be binding on each future Holder and the Company.
9.5 GOVERNING LAW
This Warrant shall be governed by and construed under the laws of the
state of California without regard to principles of conflict of laws.
9.6 SUCCESSORS AND ASSIGNS; TRANSFER
The terms and conditions of this Warrant shall inure to the benefit of
and be binding on the respective successors and assigns of the parties. This
Warrant may not be transferred or assigned without the consent of the Company,
except, subject to applicable U.S., state, and foreign securities laws, to a
subsidiary of the Holder.
[Signature page follows.]
-8-
<PAGE> 9
IN WITNESS WHEREOF, the parties have executed this Warrant as of the
date first written above.
BackWeb Technologies Ltd. RealNetworks, Inc.
By: /s/ Eli Barkat By: /s/ Paul Bialek
-9-
<PAGE> 10
NOTICE OF CASH EXERCISE
To : BackWeb Technologies Ltd.
The undersigned hereby irrevocably elects to purchase ___________
Ordinary Shares of BackWeb Technologies Ltd. (the "COMPANY") issuable upon the
exercise of the attached Warrant and requests that certificates for such shares
be issued in the name of and delivered to the address of the undersigned stated
below and, if said number of shares shall not be all the shares that may be
purchased pursuant to the attached Warrant, that a new Warrant evidencing the
right to purchase the balance of such shares be registered in the name of, and
delivered to, the undersigned at the address stated below. The undersigned
agrees with and represents to the Company that said shares are acquired for the
account of the undersigned for investment and not with a view to, or for sale in
connection with, any distribution or public offering within the meaning of the
Securities Act of 1933, as amended.
Payment enclosed in the amount of $___________.
Dated: ________________
Name of Holder of Warrant:_____________________________________________
(please print)
Address: _____________________________________________________________
Signature: ___________________________________________________________
<PAGE> 11
Exhibit B
NOTICE OF NET ISSUANCE EXERCISE
To: BackWeb Technologies Ltd.
The undersigned hereby irrevocably elects to convert the attached
Warrant into such number of shares of Common Stock of BackWeb Technologies Ltd.
(the "COMPANY") as is determined pursuant to Section 1.2 of the attached
Warrant. The undersigned requests that certificates of such net issuance shares
be delivered to the address of the undersigned stated below. The undersigned
agrees with and represents to the Company that said shares are acquired for the
account of the undersigned for investment and not with a view to, or for sale in
connection with, any distribution or public offering within the meaning of the
Securities Act of 1933, as amended.
Dated: ____________________
Name of Holder of Warrant:_____________________________________________
(please print)
Address: _____________________________________________________________
Signature: ___________________________________________________________
<PAGE> 12
EXHIBIT C
INVESTMENT REPRESENTATIONS
THIS AGREEMENT MUST BE COMPLETED, SIGNED AND RETURNED TO BACKWEB
TECHNOLOGIES LTD. ALONG WITH THE NOTICE OF EXERCISE OR NOTICE OF NET ISSUANCE
EXERCISE, AS THE CASE MAY BE BEFORE THE STOCK ISSUABLE UPON EXERCISE OF THE
WARRANT DATED JANUARY __, 2000, WILL BE ISSUED.
______________, 20__
BackWeb Technologies Ltd.
3 Abba Hillel Street
Ramat Gan, Israel
Attn: Chief Executive Officer
Ladies and Gentlemen:
The undersigned, ____________ ("Purchaser"), intends to
acquire up to _______ shares of the Ordinary Shares (the "Ordinary Shares") of
BackWeb Technologies Ltd. (the "Company") from the Company pursuant to the
exercise of that certain Warrant held by Purchaser. The Stock will be issued to
Purchaser in a transaction not involving a public offering and pursuant to an
exemption from registration under the Securities Act of 1933, as amended (the
"1933 Act") and applicable state securities laws. In connection with such
purchase and in order to comply with the exemptions from registration relied
upon by the Company, Purchaser represents, warrants and agrees as follows:
Purchaser is an accredited investor as defined in Rule 501(a)
of Regulation D promulgated under the Securities Act.
Purchaser is acquiring the Ordinary Shares for its own
account, to hold for investment, and not with a view to or for sale in
connection with any distribution of the Ordinary Shares in violation of the 1933
Act. Purchaser shall not make any sale, transfer or other disposition of the
Ordinary Shares in violation of the 1933 Act or the General Rules and
Regulations promulgated thereunder by the Securities and Exchange Commission
(the "SEC") or in violation of any applicable state securities law.
Purchaser has been advised that the Ordinary Shares have not
been registered under the 1933 Act or state securities laws on the ground that
this transaction is exempt from
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<PAGE> 13
registration, and that reliance by the Company on such exemptions is predicated
in part on Purchaser's representations set forth in this letter.
Purchaser has been informed that under the 1933 Act, the
Ordinary Shares must be held indefinitely unless it is subsequently registered
under the 1933 Act or unless an exemption from such registration (such as Rule
144) is available with respect to any proposed transfer or disposition by
Purchaser of the Ordinary Shares. Purchaser further agrees that the Company may
refuse to permit Purchaser to sell, transfer or dispose of the Ordinary Shares
(except as permitted under Rule 144) unless there is in effect a registration
statement under the 1933 Act and any applicable state securities laws covering
such transfer, or unless Purchaser furnishes an opinion of counsel reasonably
satisfactory to counsel for the Company, to the effect that such registration is
not required; provided, however, such opinion will not be required in connection
with a transfer in compliance with Rule 144 or to a subsidiary of the Purchaser.
Purchaser also understands and agrees that there will be
placed on the certificate(s) for the Ordinary Stock, or any substitutions
therefor, a legend stating in substance:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE OR
FOREIGN SECURITIES LAWS, AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED,
OFFERED, PLEDGED OR OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE OR FOREIGN SECURITIES
LAWS COVERING ANY SUCH TRANSACTION INVOLVING SAID SECURITIES, (B) THE COMPANY
RECEIVES AN OPINION OF LEGAL COUNSEL FOR THE HOLDER OF THE SECURITIES
SATISFACTORY TO THE COMPANY STATING THAT SUCH TRANSACTION IS EXEMPT FROM
REGISTRATION, (C) SUCH TRANSACTION IS IN COMPLIANCE WITH RULE 144 OF THE ACT, OR
(D) THE COMPANY OTHERWISE SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM
REGISTRATION.
Purchaser has carefully read this letter and has discussed its
requirements and other applicable limitations upon Purchaser's resale of the
Ordinary Shares with Purchaser's counsel.
Very truly yours,
_________________________________________
By: _____________________________________
Title: __________________________________
-3-
<PAGE> 14
ASSIGNMENT
For value received the undersigned sells, assigns and transfers to the
transferee named below, and the transferee agrees to be bound by all the terms
and conditions of, the attached Warrant, together with all right, title and
interest, and the undersigned does irrevocably constitute and appoint the
transfer agent of BackWeb Technologies Ltd. (the "COMPANY") as the undersigned's
attorney, to transfer said Warrant on the books of the Company, with full power
of substitution in the premises.
Dated: __________________________
Name of Holder of Warrant:_____________________________________________
(please print)
Address: _____________________________________________________________
Signature of Transferor: _____________________________________________
Name of transferee:____________________________________________________
(please print)
Address of transferee:_________________________________________________
Signature of Transferee: _____________________________________________
