SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------
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 14, 1997
TENERA, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 1-9812 94-3213541
(STATE OF OTHER JURISDICTION (COMMISSION (I.R.S. EMPLOYER
OF INCORPORATION) FILE NUMBER) IDENTIFICATION NO.)
One Market, Spear Tower, Suite 1850, San Francisco, California 94105-1018
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(415) 536-4744
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On November 14, 1997, the registrant, TENERA, Inc. ("TENERA"), consummated
the sale of all of the assets related to the mass transportation business of
TENERA's wholly-owned subsidiary, TENERA Technologies, LLC, to Spear
Technologies, Inc., a California corporation newly formed to acquire the
assets by former members of TENERA's management, including Michael D. Thomas,
former Chairman of the Board and Chief Executive Officer. TENERA received
$1,300,000 in cash, a promissory note in the amount of $300,000 and a warrant
to acquire 4% of the buyer's then outstanding shares of common stock
exercisable upon an initial public offering or a change of control (as
defined in the warrant.) The buyer also assumed liabilities associated with
the business. In connection with the sale, the Board of Directors named
Robert C. McKay, former Chief Operating Officer, Chief Executive Officer and
President. Jeffrey R. Hazarian, TENERA's Chief Financial Officer, was also
named Executive Vice President.
ITEM 7. EXHIBITS
Exhibit
Number Exhibit
2.1 Asset Acquisition Agreement dated November 14, 1997 among
TENERA, Inc., TENERA Technologies, LLC, and Spear
Technologies, Inc.
10.1 $300,000 Promissory Note dated November 14, 1997
10.2 Warrant to Purchase Common Stock of Spear Technologies, Inc.
dated November 14, 1997
10.3 Trademark License Agreement dated November 14, 1997 between
TENERA, Inc. and Spear Technologies, Inc.
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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.
TENERA, INC.
By: /s/ JEFFREY R. HAZARIAN
------------------------------
Jeffrey R. Hazarian
Chief Financial Officer,
Corporate Secretary, and
Executive Vice President
Date: November 25, 1997
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INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Exhibit Page
2.1 Asset Acquisition Agreement dated November 14,
1997 among TENERA, Inc., TENERA Technologies, LLC,
and Spear Technologies, Inc. ............................... 5
10.1 $300,000 Promissory Note dated November 14, 1997 ........... 19
10.2 Warrant to Purchase Common Stock of Spear
Technologies, Inc. dated November 14, 1997 ................. 22
10.3 Trademark License Agreement dated November 14, 1997
between TENERA, Inc. and Spear Technologies, Inc. .......... 28
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ASSET ACQUISITION AGREEMENT
by and among
TENERA, INC.,
a Delaware corporation,
TENERA TECHNOLOGIES, LLC
a Delaware limited liability company,
and
SPEAR TECHNOLOGIES, INC.,
a California corporation
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THIS ASSET ACQUISITION AGREEMENT (the "Agreement") is made this 14th
day of November, 1997, by and among TENERA, INC. ("TENERA"), a Delaware
corporation, and TENERA TECHNOLOGIES, LLC (the "LLC"), a Delaware limited
liability company (sometimes collectively referred to herein as "Seller"), on
the one hand, and SPEAR TECHNOLOGIES, INC., a California corporation
("Buyer"), on the other hand. Capitalized terms not otherwise defined herein
are defined in Article I.
RECITALS
A. The LLC is a wholly owned subsidiary of TENERA, through which
TENERA conducts its transportation technology business (the "Business").
B. Buyer is a corporation newly formed by members of management of
TENERA for the purpose of acquiring all of the assets and liabilities of the
Business.
C. Buyer desires to purchase and assume from the Seller, on the
following terms and conditions, the Assets and the Assumed Liabilities.
D. Seller desires to sell and assign to Buyer, on the following
terms and conditions, the Assets and the Assumed Liabilities.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants, representations, warranties, conditions, and agreements
hereinafter expressed, the Parties agree as follows:
ARTICLE I.
DEFINITIONS
"Assets" means all contracts, leases and distribution licenses
(collectively, "Contracts"), proprietary software, tangible personal property
and other assets owned or used by or in connection with the Business set forth
on Schedule A, all right, title and interest in assets used by or in
connection with the Business that TENERA possesses and has the right to
transfer, and all right, title and interest that the LLC possesses and has the
right to transfer in and to its other assets and property, real, personal, and
mixed, tangible and intangible, of whatever kind, and all goodwill of the
Business and value thereof as a going concern, except the Retained Assets.
Without limiting the generality of the foregoing, the Assets include the
following items:
(a) all accounts and notes receivable and deposits (excluding
cash and cash equivalents)of the LLC;
(b) all Intellectual Property of the LLC, or used by or in
connection with Business, and documentation thereof and the right and power to
assert, defend and recover title thereto in the same manner and to the same
extent as Seller could or could cause to be done if the transactions
contemplated hereby did not occur, and the right to recover for past damages
on account of the infringement, misuse, or theft thereof;
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(c) all records, including business, engineering, and other
records, and all associated documents, discs, tapes, and other storage or
recordkeeping media of the LLC and the Business, including but not limited to
all sales data, customer lists, accounts, bids, contracts, supplier records,
and other data and information relating to the Business, but excluding
original copies of the corporate minute books of the LLC, which books Seller
will retain and permit Buyer access to or, in the event Seller desires to
dispose of such books, will turn over to Buyer;
(d) all claims and rights under the Licenses and Contracts;
and
(e) all other claims against others, rights and choses in
action arising from the Business, including those arising under insurance
policies, liquidated or unliquidated.
"Assumed Liabilities" means all liabilities and obligations of the
LLC, or relating to or arising out of the Assets or the Business (whether
known or unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or unliquidated,
and whether due or to become due) other than the Retained Liabilities,
including without limitation:
(a) all liabilities and obligations of the LLC and the
Business set forth on Schedule B;
(b) all liabilities of the LLC for unpaid taxes with respect
to periods prior to the Closing;
(c) all liabilities of the LLC for transfer, sales, use, and
other taxes (excluding income taxes) arising in connection with the
consummation of the transactions contemplated hereby;
(d) all liabilities and obligations for severance or any other
claim asserted by any employee of the LLC, all of which are set forth on
Schedule C (the "Transferred Employees"), or under any employee benefit plan
in which any Transferred Employee was a participant;
(e) all liabilities and obligations of or relating to the LLC
with respect to environmental matters; and
(f) all obligations of the LLC to indemnify any person
(including any LLC manager or member) with respect to any matter arising prior
to the Effective Time, by reason of the fact that such person was a member,
manager, officer, employee or agent of the LLC or was serving at the request
of the LLC as a partner, trustee, director, officer, employee or agent of
another entity (whether such indemnification is for judgments, damages,
penalties, fines, costs, amounts paid in settlement, losses, expenses, or
otherwise and whether such indemnification is pursuant to any law, charter
document, operating agreement, agreement, or otherwise); provided, however,
that the Assumed Liabilities shall not include any liability or obligation of
TENERA or the LLC under or arising out of this Agreement or the consummation
of the transactions contemplated hereby.
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"Business" shall have the meaning set forth in Recital A
herein.
"Closing" means the consummation of the transactions
contemplated by this Agreement.
"Closing Date" means November 14, 1997 or, if the conditions to
Closing are not by then satisfied, on such Closing Date and upon satisfaction
of such conditions as the Parties shall mutually agree.
"Effective Time" shall mean the effective time of the Closing,
which shall be as of the close of business on the Closing Date.
"Intellectual Property" means any copyrighted work and
registrations thereof and applications therefor, trade secret, software
program, invention, process, and item of proprietary know-how and other
intellectual property, and all licenses, sublicenses, and agreements in
respect thereof, in each case used or licensed by or to Seller, except those
included in the Retained Assets.
"License" means each license, permit, approval, registration or
certificate required for the conduct of Business.
"Party" means either Buyer or Seller, and "Parties" means all
of them.
"Retained Assets" means (i) all cash and cash equivalents of
the LLC, (ii) all rights in and to any and all of the TENERA trade name and
trademarks set forth on Schedule D.
"Retained Liabilities" means any and all (i) liabilities
accrued prior to the Effective Time for salary owed to any Transferred
Employee, and (ii) intercompany liabilities of the LLC to TENERA set forth on
Schedule E.
ARTICLE II.
PURCHASE AND SALE OF ASSETS
2.1 Assets to be Purchased. Subject to the terms and
conditions hereof, on the Closing Date and as of the Effective Time, Seller
hereby agrees to sell to Buyer all right, title and interest of Seller in and
to all of the Assets.
2.2 Assumed Liabilities. Subject to the terms and conditions
hereof, on the Closing Date and as of the Effective Time, Seller hereby agrees
to assign and transfer to Buyer and Buyer hereby agrees to assume the Assumed
Liabilities.
2.3 Consideration. The consideration for the Assets shall be
the aggregate of (i) One Million Three Hundred Thousand Dollars ($1,300,000),
plus an amount equal to all cash payments made in connection with the Business
after October 31, 1997 until the Effective Time (excluding salaries of the
Transferred Employees accrued prior to November 1, 1997) as set forth on
Schedule F (the "Cash Consideration"), payable all in cash by wire transfer of
immediately
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available funds, (ii) Three Hundred Thousand Dollars ($300,000)represented by
a promissory note in the form attached hereto as Exhibit A (the "Note"), (iii)
a warrant to purchase shares of the common stock of Buyer in the form attached
hereto as Exhibit B (the "Warrant"), plus (iv) the amount of the Assumed
Liabilities (collectively, the "Purchase Price").
2.4 Closing. The Closing shall take place on the Closing Date
at the offices of TENERA, Inc., One Market, Spear Tower, Suite 1850, San
Francisco, CA 94105, or if the conditions to Closing are not by then
satisfied, on such Closing Date, and upon satisfaction of such conditions as
the Parties shall mutually agree and designate.
2.5 Deliveries of Seller at Closing. At Closing, subject to
the conditions to the Seller's obligations in Article VI, Seller shall execute
and deliver to Buyer the documents identified in Section 5.7.
2.6 Deliveries of Buyer at Closing. At Closing, subject to
the conditions to the Buyer's obligations in Article V, Buyer shall execute
and deliver to Seller the items and documents identified in Sections 6.4 and
6.5.
2.7 Allocation. The Parties agree to allocate the Purchase
Price among the Assets for all purposes in accordance with Schedule G.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF SELLER
TENERA and the LLC, jointly and severally, hereby make the
following representations and warranties, each of which is true and correct on
the date hereof and shall be true and correct on the Closing Date, and each of
which shall survive the Closing Date and the consummation of the transactions
contemplated hereby.
3.1 Corporate and LLC Existence. TENERA is a corporation, and
the LLC is a limited liability company, each of which is duly organized,
validly existing and in good standing under the laws of Delaware.
3.2 Approval; Binding Agreement. The execution and delivery
of this Agreement has been duly authorized and approved by all necessary
corporate or limited liability company action, as applicable, of each of
TENERA and the LLC, and such authorization and approval has not been revoked.
Pursuant to such authorization and approval, each of TENERA and the LLC has
full power and authority to enter into this Agreement and to perform its
obligations hereunder. This Agreement is the legal, valid and binding
obligation of each of TENERA and the LLC, enforceable against each of them
according to its terms.
3.3 No Breach of Charter Documents or Agreements. The
execution of this Agreement and the consummation of the transactions
contemplated hereby has not and will not constitute or result in the breach of
any of the provisions of, or constitute a default under, the articles of
incorporation or by-laws of TENERA, the articles of organization or the
operating agreement of the LLC, or any material agreement or commitment to
which either is a party or by
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which either is bound.
3.4 Broker's Fees. Seller has not retained any broker, finder or
agent or agreed to pay any brokerage fees, finder's fees or commissions with
respect to the transactions contemplated by this Agreement.
3.5 Disclaimer of Representations and Warranties. Seller makes no
other representation or warranty, express or implied, at law or in equity, in
respect of any of the Assets, Assumed Liabilities or operations of the
Business, including, without limitation, with respect to title,
merchantability or fitness for any particular purpose, and any such other
representations or warranties are hereby expressly disclaimed. Buyer hereby
acknowledges and agrees that the Buyer is purchasing the Assets on an "as-is,
where-is" basis.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby makes the following representations and warranties,
each of which is true and correct on the date hereof and will be true and
correct on the Closing Date, and each of which shall survive the Closing Date
and the consummation of the transactions contemplated hereby.
4.1 Corporate Existence. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of
California.
4.2 Approval; Binding Agreement. The execution and delivery of
this Agreement has been duly authorized and approved by all necessary
corporate action of Buyer, and such authorization and approval has not been
revoked. Pursuant to such authorization and approval, Buyer has full power
and authority to enter into this Agreement and to perform its obligations
hereunder. This Agreement is the legal, valid and binding obligation of
Buyer, enforceable against Buyer according to its terms.
4.3 No Breach of Articles or Agreements. The execution of this
Agreement and the consummation of the transactions contemplated hereby has not
and will not constitute or result in the breach of any of the provisions of,
or constitute a default under, the articles of incorporation or by-laws of
Buyer, or any material agreement or commitment to which Buyer is a party or by
which it is bound.
4.4 Broker's Fees. Buyer has not retained any broker, finder or
agent or agreed to pay any brokerage fees, finder's fees or commissions with
respect to the transactions contemplated by this Agreement.
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ARTICLE V.
CONDITIONS TO BUYER'S OBLIGATIONS
The obligations of Buyer to consummate the transactions provided for
in this Agreement shall be subject to the satisfaction of each of the
following conditions on or before the Closing Date, subject to the right of
Buyer to waive any one or more of such conditions:
5.1 Representations and Warranties of Seller. The representations
and warranties of Seller contained in this Agreement and in the documents to
be delivered to Buyer pursuant hereto and in connection herewith shall be true
and correct in all respects on the date hereof and on the Closing Date as
though such representations and warranties were made on the Closing Date.
5.2 Approval by TENERA. The Board of Directors of TENERA shall
have approved the execution and delivery of this Agreement by TENERA and the
LLC and the transactions contemplated hereby in accordance with all applicable
requirements of law and the charter documents of TENERA and the LLC.
5.3 Performance of this Agreement. Seller shall have duly
performed or complied with all of the obligations to be performed or complied
with by it under the terms of this Agreement on or prior to the Closing Date.
5.4 No Material Adverse Change. There shall have been no material
adverse change, actual or threatened, in the Business (including the Assets
and Assumed Liabilities), whether or not covered by insurance, as a result of
any cause whatsoever.
5.5 No Lawsuits. No suit, action or other proceeding or
investigation shall be threatened or pending before or by any court or
governmental agency concerning this Agreement or the consummation of the
transactions contemplated hereby. No governmental agency shall have
threatened or directed any request for information concerning this Agreement,
the transactions contemplated hereby or the consequences or implications of
such transactions to Buyer or Seller, or any officer, director, employee or
agent of either of them.
5.6 No Restrictions. There shall exist no conditions, restrictions
or reservations affecting the title to or utility of the Assets which would
prevent Buyer from occupying and utilizing the Assets, or any part thereof, to
the same extent that Seller might continue to do so if the sale and transfer
contemplated hereby did not take place, except for the failure to obtain any
third party consent which may be required in connection with the transfer of
any of the Assets.
5.7 Delivery of Closing Documents. Buyer shall receive from Seller
on the Closing Date:
(a) A Bill of Sale in the form attached hereto as Exhibit C
conveying to Buyer all of Seller's right, title and interest in and to the
Assets, duly executed by Seller.
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(b) An Assignment in the form attached hereto as Exhibit D
assigning to Buyer all of Seller's interest in and to the Contracts,
Intellectual Property and Licenses, duly executed by Seller.
(c) A Certificate of TENERA to the effect that each of the
conditions specified in Section 5.1 - 5.6 is satisfied.
5.8 License Agreement. On or before the Closing Date, Buyer and
TENERA shall have entered into a license agreement in the form attached as
Exhibit E pursuant to which TENERA shall grant Buyer a fully paid, exclusive
license and right to use the TENERA trade name and trademarks as currently
used in connection with the Business as it is currently conducted for a period
of one (1) year from the Effective Date.
5.9 Further Assurances. Buyer shall have received such further
instruments and documents as may reasonably be required to carry out the
transactions contemplated hereby and to evidence the fulfillment of the
agreements herein contained and the performance of all conditions to the
consummation of such transactions.
ARTICLE VI.
CONDITIONS TO SELLER'S OBLIGATIONS
The obligations of Seller to consummate the transactions provided
for in this Agreement shall be subject to the satisfaction of each of the
following conditions on or before the Closing Date, subject to the right of
Seller to waive any one or more of such conditions:
6.1 Representations and Warranties of Buyer. The representations
and warranties of Buyer contained in this Agreement, and in documents to be
delivered to Seller pursuant hereto and in connection herewith shall be true
and correct in all respects on the date hereof and on the Closing as though
such representations and warranties were made on the Closing Date.
6.2 Performance of this Agreement. Buyer shall have duly performed
or complied with all of the obligations to be performed or complied with by it
under the terms of this Agreement on or prior to the Closing Date.
6.3 No Lawsuits. No suit, action or other proceeding or
investigation shall be threatened or pending before or by any court or
governmental agency concerning this Agreement or the consummation of the
transactions contemplated hereby. No governmental agency shall have
threatened or directed any request for information concerning this Agreement,
the transactions contemplated hereby or the consequences or implications of
such transactions to Buyer or Seller, or any officer, director, employee or
agent of either of them
6.4 Delivery of the Purchase Price . Seller shall receive from
Buyer on the Closing Date the Cash Consideration, and the Note and Warrant
duly executed by Buyer.
6.5 Delivery of Closing Documents. Seller shall receive from Buyer
on the
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Closing Date:
(a) An Assumption of the Assumed Liabilities in the form
attached hereto as Exhibit F duly executed by Buyer.
(b) A Certificate of Buyer to the effect that each of the
conditions specified in Section 6.1 - 6.3 above is satisfied.
6.6 Further Assurances. Seller shall have received such further
instruments and documents as may reasonably be required to carry out the
transactions contemplated hereby and to evidence the fulfillment of the
agreements herein contained and the performance of all conditions to the
consummation of such transactions.
ARTICLE VII.
INDEMNIFICATION
7.1 Indemnification by Buyer. Buyer shall indemnify, defend and
hold harmless each of TENERA and the LLC, any corporation or other entity
affiliated with TENERA and the LLC, and any member, manager, director,
officer, employee, shareholder or agent of any of them (an "Indemnified
Party") from and against all obligations, debts, claims, liabilities, losses,
costs, deficiencies and expenses, including without limitation reasonable
attorneys' fees, costs of litigation and investigation, interest and penalties
in connection therewith ("Losses") which may be sustained by any Indemnified
Party and arise from (i) the breach of any agreement, covenant,
representation, warranty, or other obligation of Buyer made or incurred under
or pursuant to this Agreement or any document delivered pursuant hereto; or
(ii) the operation of the Business by Buyer after the Effective Time.
7.2 Indemnification by Seller. Seller shall indemnify, defend and
hold harmless each of Buyer, any corporation or other entity affiliated
therewith, and any member, manager, director, officer, employee, shareholder
or agent of any of them (an "Indemnified Party") from and against all
obligations, debts, claims, liabilities, losses, costs, deficiencies and
expenses, including without limitation reasonable attorneys' fees, costs of
litigation and investigation, interest and penalties in connection therewith
("Losses") which may be sustained by any Indemnified Party and arise from the
breach of any agreement, covenant, representation, warranty, or other
obligation of Seller made or incurred under or pursuant to this Agreement or
any document delivered pursuant hereto.
7.3 Participation in Litigation. In the event any suit or other
proceeding is initiated against any Indemnified Party with respect to which
such Indemnified Party alleges the other party (the "Indemnifying Party") is
or may be obligated to indemnify an Indemnified Party hereunder, Indemnifying
Party shall be entitled to defend, on behalf of the Indemnified Party, such
suit or proceeding, at the expense of Indemnifying Party and by counsel of its
choosing, provided that (i) such counsel is reasonably satisfactory to the
Indemnified Party, and (ii) Indemnified Party shall be entitled to participate
in such suit or proceeding with counsel of its choosing at its own expense,
which counsel shall be afforded access to all information pertinent
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to such suit or proceeding. Indemnifying Party shall not settle or otherwise
compromise any such suit or proceeding without the prior consent of such
Indemnified Party if the effect of such settlement or compromise would be to
impose liability on any such Indemnified Party hereunder.
7.4 Claims Procedure. In the event from time to time any
Indemnified Party has or will suffer any Losses for which Indemnifying Party
is obligated to indemnify it hereunder, it shall promptly notify Indemnifying
Party in writing of the matter, specifying therein the reason why such
Indemnified Party believes that such Indemnifying Party is or will be
obligated to indemnify, the amount, if liquidated, to be indemnified, and the
basis on which such Indemnified Party has calculated such amount; if not yet
liquidated, the notice shall so state. Indemnifying Party shall (i) pay any
amount to be indemnified hereunder, or (ii) undertake and commence a defense
of the Indemnified Party regarding any such matter, within a reasonable period
of time but in any event not more than 30 days after receipt of notice from
the Indemnified Party. The failure or delay of any Indemnified Party to
provide notice hereunder shall not effect such party's right to
indemnification hereunder in the absence of actual prejudice to Indemnifying
Party resulting from such failure or delay.
ARTICLE VIII.
MISCELLANEOUS
8.1 Expense Sharing Arrangement. The parties hereby agree to use
reasonable good faith efforts to enter into an agreement relating to the
shared use and allocation of costs of the office space, equipment and general
and administrative personnel located at One Market, Spear Tower, Suite 1850,
San Francisco, CA 94105, pursuant to which Buyer will reimburse Seller for its
allocable portion of all direct costs incurred by Seller in connection with
such shared facilities.
8.2 Consents. In the event that the transfer or assignment of any
Contract or other Asset requires the consent of any third party, the parties
hereby agree to cooperate in good faith to obtain such consent and shall
execute and deliver all such further instruments and documents and take all
such other actions as may reasonably be required in connection therewith and
the consummation of the transactions contemplated hereby. Specifically, in
the event that any Contract is not assignable to Buyer, the parties shall
cooperate in good faith to structure an arrangement (such as a subcontract
between Seller and Buyer, as subcontractor) so that each party receives the
same economic benefit as if the Contract had actually been so assigned. Buyer
shall indemnify and hold harmless Seller and any Seller Indemnified Party in
the manner and to the extent set forth in Article VII against any Losses which
may be sustained by Seller in connection with any such arrangement or the
failure to obtain any such assignment.
8.3 Assignment; Binding Agreement.
(a) Neither this Agreement nor any of the rights or
obligations hereunder may be assigned without prior written consent of the
Parties.
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(b) This Agreement shall be binding upon and shall inure to
the benefit of the Parties and their respective successors and permitted
assigns.
8.4 Confidentiality; Publicity. Except (i) as required by law,
(ii) after such information has become generally available to the public other
than in violation of this Agreement, (iii) to any Party's attorneys or
accountants, (iv) to third parties to the minimum extent necessary in
connection with the preparation of income tax returns and financial statements
and in connection with lending transactions, or (v) by the Buyer in connection
with obtaining investments or financing for the consummation of the
transactions contemplated hereby, no Party hereto will disclose to any person
or entity the financial terms of this Agreement without the prior written
consent of the other Parties, which consent may be withheld by such Parties in
their sole discretion. On or promptly after the Closing, the Parties will
cooperate in good faith in preparing and issuing a public announcement
relating the Closing.
8.5 Bulk Sales. The parties hereby waive compliance with any
applicable law governing bulk sales. Buyer agrees to indemnify, defend and
hold harmless Seller from and against all loss, cost or expenses, resulting
from the assertion of claims made against the Assets sold hereunder or against
Seller by creditors under any bulk sales law with respect to liabilities and
obligations of Seller assumed by Buyer hereunder, such indemnity to be in
accordance with the provisions of Article VII hereof.
8.6 Remedies. Nothing contained herein is intended to or shall be
construed to limit the remedies which either party may have against the other
in the event of a breach of or default under this Agreement, it being intended
that any remedies shall be cumulative and not exclusive.
8.7 Entire Agreement and Modification. This Agreement, including
the Exhibits and Schedules attached hereto and the documents delivered
pursuant hereto, constitutes the entire agreement between the parties. No
changes of, modifications of, or additions to this Agreement shall be valid
unless the same shall be in writing and signed by all Parties.
8.8 Severability. If any provision of this Agreement shall be
determined to be contrary to law and unenforceable by any court of law, the
remaining provisions shall be severable and enforceable in accordance with
their terms.
8.9 Counterparts. This Agreement may be executed in one or more
identical counterparts, each of which shall be deemed an original but all of
which together will constitute one and the same instrument.
8.10 Headings; Interpretation. The Article and Section headings
contained in this Agreement are inserted for convenience only and shall not
affect in any way the meaning or interpretation of the Agreement. Both
parties have participated substantially in the negotiation and drafting of
this Agreement and each party hereby disclaims any defense or assertion in any
litigation or arbitration that any ambiguity herein should be construed
against the draftsman.
8.11 Governing Law. This Agreement shall be construed and
interpreted
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according to the laws of the State of California.
8.12 Payment of Fees and Expenses. Each Party shall pay all fees
and expenses of such Party's respective counsel, accountants and other experts
and all other expenses incurred by such Party incident to the negotiation,
preparation and execution of this Agreement and the consummation of the
transactions contemplated hereby.
8.13 Notices. All notices, requests, demands and other
communications hereunder shall be deemed to have been duly given if the same
shall be in writing and shall be delivered personally or sent by registered or
certified mail, postage prepaid or by reputable overnight courier (e.g.,
Federal Express) and addressed as set forth below:
If to Seller:
TENERA, INC.
One Market, Spear Tower
Suite 1850
San Francisco, CA 94105
Attention: Chief Executive Officer
copy to:
Bryan Cave LLP
120 Broadway, Suite 500
Santa Monica, CA 90401
Attention: Thomas S. Loo, Esq.
If to Buyer:
SPEAR TECHNOLOGIES, INC.
One Market, Spear Tower
Suite 1850
San Francisco, CA 94105
Attention: Michael D. Thomas
copy to:
Gray Cary Ware & Freidenrich400 Hamilton Avenue
Palo Alto, CA 94301
Attention: Thomas W. Furlong, Esq.
Any such notice personally served shall be deemed received upon
receipt. Any notice sent by mail, certified or registered, shall be deemed
received three (3) business days after deposit in the mail. Any notice sent by
reputable overnight courier shall be deemed received on
16
<PAGE>
the next business day following deposit with the courier. Any party may change
the address to which notices are to be addressed by giving the other parties
notice in the manner herein set forth.
8.14 Further Assurances. The Parties shall execute and deliver all
such further instruments and documents and take all such other actions as may
reasonably be required to carry out the transactions contemplated hereby and
to evidence the fulfillment of the agreements herein contained.
8.15 Arbitration. Any controversy or claim among the Parties
arising out of or relating to this Agreement, or the breach hereof, shall be
finally and conclusively settled and resolved by arbitration pursuant to the
commercial rules and under the auspices of the American Arbitration
Association ("AAA"). Venue for such arbitration shall be located at the
offices of the AAA located in San Francisco, California.
8.16 Attorneys' Fees and Costs. If any action is brought for
enforcement of this Agreement, the prevailing Party shall be entitled to
recover from the other party all attorneys' fees, expenses and costs, court
costs and costs of arbitration, litigation and investigation incurred by the
prevailing Party in protecting or enforcing its rights hereunder.
IN WITNESS WHEREOF, the Parties have executed this Agreement as
of the day and year first above written.
SELLER: TENERA, INC.
By: /s/ JEFFREY R. HAZARIAN
--------------------------------
Jeffrey R. Hazarian
Title: Chief Financial Officer
TENERA TECHNOLOGIES, LLC
By: /s/ JEFFREY R. HAZARIAN
--------------------------------
Jeffrey R. Hazarian
Title: Chief Financial Officer
BUYER: SPEAR TECHNOLOGIES, INC.
By: /s/ MICHAEL D. THOMAS
--------------------------------
Michael D. Thomas
Title: Chief Executive Officer
17
<PAGE>
TABLE OF SCHEDULES AND EXHIBITS
Schedules
A Assets
B Assumed Liabilities
C Transferred Employees
D Retained Assets
E Retained Liabilities
F Post 10/31/97 Payments
G Purchase Price Allocation
Exhibits
A Promissory Note
B Warrant
C Bill of Sale
D Assignment of Contracts, Intellectual Property and Licenses
E License Agreement
F Assumption of Liabilities
18
6% PROMISSORY NOTE
$300,000.00 November 14, 1997
SPEAR TECHNOLOGIES, INC., a California corporation (the "Company"), for value
received, promises to pay to the order of TENERA, INC. ("Holder") the
principal sum of Three Hundred Thousand Dollars ($300,000.00), plus interest
on the unpaid balance hereof at a rate of 6% per annum from the date hereof,
computed on the basis of the actual number of days elapsed and a year of 365
days; provided, however, that interest shall accrue from and after an Event of
Default (as defined below) at a rate equal to the lesser of 10% or the maximum
rate permitted by law (the "Default Rate"). The entire balance of this Note
with all accrued interest shall be due and payable upon demand by Holder on or
after the earlier to occur of (i) the closing of the Company's stock
financing(s) after the date hereof which results in aggregate gross proceeds
to the Company, in cash or conversion of debt, of Four Million Dollars
($4,000,000) or more, and (ii) November 14, 1999.
Payments. The Company may prepay this Note in full or in part at any
time, without penalty or additional fees. If any payment on this Note shall
become due on a Saturday, Sunday, or a public holiday under the laws of the
State of California, such payment shall be made on the next succeeding
business day and such extension of time shall be included in computing
interest in connection with such payment. All payments shall be in lawful
money of the United States of America.
Legal Fees; Waivers; Governing Law. In the event of any legal action to
enforce the rights of any party named in this Note, the party prevailing in
such action shall be entitled, in addition to such other relief as may be
granted, all reasonable costs and expenses, including reasonable attorneys'
fees, incurred in such action. The Company hereby waives notice of default,
presentment or demand for payment, protest or notice of nonpayment or dishonor
and all other notices or demands relative to this instrument. The validity,
meaning and effect of this Note shall be determined in accordance with the
laws of the State of California, without regard to principles of conflicts of
law.
Payments. All payments and prepayments received by Holder hereunder
shall be applied first to all unpaid costs and expenses payable by the Company
hereunder, second to all accrued and unpaid interest hereunder, and third to
the unpaid principal balance hereof.
Events of Default. Each of the following shall constitute an "Event of
Default" under this Note:
(1) The Company fails to pay when due, whether by acceleration or
otherwise, any payment required under this Note within one (1) business day
after the date on which such payment is due;
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<PAGE>
(2) The Company defaults in the payment or performance of any
obligations, or any defined event of default, under the terms of any contract
or instrument (other than this Note) pursuant to which the Company has
incurred any indebtedness or other liability to any person or entity, and the
Company shall not have cured such default within thirty (30) days of notice of
such default;
(3) (a) The Company shall (i) commence any case, proceeding or other
action under any existing or future law of any jurisdiction, domestic or
foreign, relating to bankruptcy, insolvency, reorganization, or relief of
debtors, seeking to have an order for relief entered with respect to it, or
seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization,
arrangement, adjustment, winding-up, liquidation, dissolution, composition, or
other relief with respect to it or its debts, or (ii) commence any case,
proceeding, or other action seeking appointment of a receiver, trustee,
custodian, or other similar official for it or for all or any substantial part
of its assets, or (iii) make a general assignment for the benefit of its
creditors; (b) there shall be commenced against the Company any case,
proceeding or other action of a nature referred to in clause (a) above that
(i) results in the entry of an order for relief or any such adjudication or
appointment, or (ii) remains undismissed, undischarged, or unbonded for a
period of sixty (60) days; (c) there shall be commenced against the Company
any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint, or similar process against all or any
substantial part of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged, or stayed or bonded
pending appeal within sixty (60) days from the entry thereof; (d) the Company
shall take any action in furtherance of or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (a), (b), or (c)
previously; or (e) the Company shall generally not, or shall be unable to, or
shall admit in writing its inability to, pay its debts as they become due; or
(4) One or more judgments or decrees shall be entered against the
Company not paid or fully covered by insurance and all such judgments or
decrees shall not have been vacated, discharged, or stayed or bonded pending
appeal within sixty (60) days from the entry thereof.
In the event that any Event of Default described in paragraph (3) above shall
occur, all obligations and liabilities of the Company under this Note shall be
immediately due and payable without demand or notice of any kind whatsoever.
In the event that any other Event of Default described above shall occur,
Holder, in its sole discretion, may declare all obligations and liabilities of
the Company due and payable by advising the Company of such declaration,
whereupon all of the obligations and liabilities of the Company shall be
immediately due and payable. After an Event of Default, the Company shall be
20
<PAGE>
liable for all costs and expenses incurred by the Holder in connection with
collecting amounts owed under this Note, which amounts shall be added to this
Note and shall bear interest at the Default Rate.
Set-Off. The Company also irrevocably waives all of its now existing and
hereafter arising rights to set-off any amounts owing to Holder under this
Note, or otherwise, against any amounts now or hereafter owing by Holder or
its representatives to the Company.
Successors and Assigns. Whenever in this Note reference is made to
Holder or the Company, such reference shall be deemed to include, as
applicable, a reference to their respective successors and assigns. The
provisions of this Note shall be binding upon and shall inure to the benefit
of said successors and assigns. The Company's successors and assigns shall
include, without limitation, a receiver, trustee or debtor-in-possession of or
for the Company.
IN WITNESS WHEREOF, Spear Technologies, Inc. has duly caused this Note to be
signed in its name and on its behalf by its duly authorized officer as of the
date hereinabove written.
SPEAR TECHNOLOGIES, INC.
By: /s/ MICHAEL THOMAS
------------------------------
Michael Thomas, President
21
NEITHER THE WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). NO
SALE, TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE
EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (ii)
AN OPINION OF COUNSEL FOR THE HOLDER, REASONABLY SATISFACTORY TO THE COMPANY,
THAT SUCH REGISTRATION IS NOT REQUIRED OR (iii) RECEIPT OF A NO-ACTION LETTER
FROM THE SECURITIES AND EXCHANGE COMMISSION TO THE EFFECT THAT REGISTRATION
UNDER THE ACT IS NOT REQUIRED.
SPEAR TECHNOLOGIES, INC.
WARRANT TO PURCHASE
COMMON STOCK
This certifies that TENERA, INC. ("Purchaser") is entitled to purchase
under this Warrant that number of shares (the "Shares") of common stock (the
"Common Stock") of Spear Technologies, Inc., a California corporation (the
"Company"), equal to four percent (4%) of the total shares of Common Stock
outstanding immediately following the exercise of this Warrant (assuming for
purposes of calculating this four percent (4%) that all then-outstanding
securities (as such term is defined under the Act) convertible into or
exercisable for Common Stock converted or exercised), at an aggregate price of
$100.00 (the "Warrant Price"), subject to the provisions and upon the terms
and conditions hereinafter set forth.
1. Term.
(a) This Warrant is exercisable, in whole but not in part, at any
time after the earlier to occur of:
(i) the filing of a registration statement filed in a bona
fide firm commitment underwriting for a minimum amount of $20,000,000 of
proceeds to the Company under the Act, covering any of the Company's
securities (as that term is defined under the Securities Act of 1933, as then
in effect);
(ii) immediately prior to the effective date of the merger of
the Company with and into, the consolidation of the Company with, or the sale
by the Company of all or substantially all of its assets to, another
corporation (other than such a transaction wherein the shareholders of the
Company immediately prior to such transaction retain or obtain 30% or more of
the voting securities of the surviving, resulting or purchasing corporation);
(iii) immediately prior to any liquidation, dissolution or
winding up of the Company; and
22
<PAGE>
(iv) November 14, 2002.
(b) The Warrant is exercisable prior to the earlier of the
following:
(i) 5 p.m. California time on November 14, 2007;
(ii) 5:00 p.m. California time on the day prior to the
effectiveness of a registration statement filed in a bona fide firm commitment
underwriting for a minimum amount of $20,000,000 of proceeds to the Company
under the Act, covering any of the Company's securities (as that term is
defined under the Securities Act of 1933, as then in effect); provided that
the Company shall notify the Purchaser of the proposed registration of its
securities on the date that the registration statement is filed, but in any
event at least 20 days prior to the effectiveness of such registration;
(iii) the effective date of the merger of the Company with and
into, the consolidation of the Company with, or the sale by the Company of all
or substantially all of its assets to, another corporation (other than such a
transaction wherein the shareholders of the Company immediately prior to such
transaction retain or obtain 30% or more of the voting securities of the
surviving, resulting or purchasing corporation); provided that the Company
shall notify the Purchaser of the proposed effective date of the merger,
consolidation or sale at least 20 days prior to the effectiveness thereof; or
(iv) the effective date of a liquidation, dissolution or
winding up of the Company; provided that the Company shall notify the
Purchaser of the proposed date of liquidation, dissolution or winding up of
the Company at least 20 days prior to the effective date thereof.
2. Transfer of Warrant. This Warrant shall be transferable, only as a
whole and not in part, to any majority-owned subsidiary (whether directly or
indirectly owned) of Purchaser, any successor of Purchaser or any trust
created by Purchaser for the benefit of all stockholders of Purchaser.
3. Method of Exercise; Payment; Issuance of New Warrant.
(a) This Warrant may be exercised by the holder hereof, in whole
but not in part, by the surrender of this Warrant (with a notice of exercise
in a form reasonably acceptable to the Company duly executed) at the principal
office of the Company and by the payment to the Company, either (i) by check,
of an amount equal to the Warrant Price, or (ii) this Warrant without the
payment of the Warrant Price as provided in clause (i) above, together with a
statement to the effect that Purchaser elects to receive the number of Shares
receivable upon such exercise less the number of Shares having a market value
(as determined in good faith by the Board of Directors of the Company) equal
to the Warrant Price. The person or persons in whose name(s) any
certificate(s) representing shares of Common Stock shall be issuable upon
exercise of this Warrant shall be deemed to have become the holder(s) of
record of, and shall be treated
23
<PAGE>
for all purposes as the record holder(s) of the shares represented thereby
(and such shares shall be deemed to have been issued) immediately prior to the
close of business on the date or dates upon which this Warrant is exercised.
In the event of any exercise of this Warrant, certificates for the shares of
stock so purchased shall be delivered to the holder hereof as soon as possible
following receipt of such notice.
4. Stock Fully Paid; Reservation of Shares. All Shares that may be
issued upon the exercise of the rights represented by this Warrant, upon
issuance, will be fully paid and nonassessable, and free from all taxes, liens
and charges with respect to the issue thereof. During the period within which
the rights represented by the Warrant may be exercised, the Company will at
all times have authorized and reserved for the purpose of issuance upon
exercise of the purchase rights evidenced by this Warrant, a sufficient number
of Shares to provide for the exercise of the right represented by this
Warrant.
5. Adjustment of Warrant Price and Number of Shares. The number and
kind of securities purchasable upon the exercise of the Warrant and the
Warrant Price shall be subject to adjustment from time to time upon the
occurrence of certain events, as follows:
5.1 Reclassification or Merger. In case of any reclassification,
change or conversion of securities in the class issuable upon exercise of this
Warrant (other than a change in par value, or from par value to no par value,
or from no par value to par value, or as a result of a subdivision or
combination), or in case of any merger of the Company with or into another
corporation (other than a merger with another corporation in which the Company
is a continuing corporation and which does not result in any reclassification
or change of outstanding securities issuable upon exercise of this Warrant),
or in case of any sale of all or substantially all of the assets of the
Company, unless this Warrant shall have been exercised or terminated in
accordance with its terms, the Company, or such successor or purchasing
corporation, as the case may be, shall execute a new Warrant providing that
the holder of this Warrant shall have the right to exercise such new Warrant
and upon such exercise to receive, in lieu of each share of the securities
theretofore issuable upon exercise of this Warrant, the kind and amount of
shares of stock, other securities, money and property receivable upon such
reclassification, change or merger by a holder of one share of such
securities. Such new Warrant shall provide for adjustments that shall be as
nearly equivalent as may be practicable to the adjustments provided for in
this Section. The provisions of this Section shall similarly apply to
successive reclassifications, changes, mergers and transfers.
5.2 Subdivisions or Combination of Shares. If the Company at any
time while this Warrant remains outstanding and unexpired shall subdivide or
combine the Common Stock, the number of Shares issuable upon exercise hereof
shall be proportionately adjusted.
5.3 Stock Dividends. If the Company at any time while this Warrant
is outstanding and unexpired shall pay a dividend on its Common Stock payable
in shares of its stock (except any distribution specifically provided for in
the foregoing subparagraphs 5.1 and 5.2), then the number of Shares subject to
this Warrant shall be proportionately adjusted.
24
<PAGE>
6. Fractional Shares. No fractional shares will be issued in connection
with any exercise hereunder, but in lieu of such fractional shares the Company
shall make a cash payment therefor equal to the market value of such
fractional shares as determined in good faith by the Board of Directors of the
Company.
7. Shareholder Rights. No holder of the Warrant, as such, shall be
entitled to vote or receive dividends or be deemed the holder of stock or any
other securities of the Company which may at any time be issuable on the
exercise thereof for any purpose, nor shall anything contained herein be
construed to confer upon the holder of this Warrant, as such, any of the
rights of a shareholder of the Company or any right to vote for the election
of directors or upon any matter submitted to shareholders at any meeting
thereof, or to receive notice of meetings, or to receive dividends or
subscription rights or otherwise until this Warrant shall have been exercised
and the Shares purchasable upon the exercise hereof shall have become
deliverable, as provided herein.
8. Piggyback Registration Rights. The Company agrees that, in the first
rights agreement or similar agreement entered into by the Company granting
registration rights with respect to public offerings of the Company's
securities, the Company shall grant piggyback registration rights to Purchaser
with respect to the Shares entitling the Purchaser to include the Shares in
registrations made by the Company. Such registration rights shall be subject
to any limitations applicable to the other shareholders of the Company granted
piggyback rights under such rights agreement, including without limitation
"cutback" provisions, "lockup" provisions and indemnification provisions. As
a condition to the grant of such registration rights, Purchaser agrees that it
shall enter into such rights agreement.
9. Modification and Waiver. This Warrant and any provision hereof may
be changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of the same is sought.
10. Notices. Any notice, request or other document required or
permitted to be given or delivered to the holder hereof or the Company shall
be delivered, or shall be sent by certified or registered mail, postage
prepaid, to each such holder at its address as shown on the books of the
Company or to the Company at the address indicated therefore on the signature
page of this Warrant.
11. Lost Warrants or Stock Certificates. Upon receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of this Warrant or any stock certificate and, in the case of any
such loss, theft or destruction, upon receipt of an indemnity reasonably
satisfactory to the Company, or in the case of any such mutilation upon
surrender and cancellation of such Warrant or stock certificate, the Company
will make and deliver a new Warrant or stock certificate, or like tenor, in
lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.
25
<PAGE>
12. Investment Representations. Purchaser represents to the Company
that (a) by reason of Purchaser's business and financial experience Purchaser
has the capacity to protect Purchaser's own interests in this transaction, (b)
Purchaser is accepting this Warrant for investment for Purchaser's own
account, not as nominee or agent, and not with a view to, or for resale in
connection with, any distribution or public offering within the meaning of
federal and California securities laws, and (c) Purchaser is an accredited
investor as that term is defined in Rule 501 under the Act.
13. Governing Law. This Warrant shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws
of the State of California.
26
<PAGE>
IN WITNESS WHEREOF, this Warrant has been executed as of November 14,
1997.
"COMPANY" SPEAR TECHNOLOGIES, INC.
By /s/ MICHAEL THOMAS
-----------------------------
Michael Thomas, President
Address: One Market Street
Spear Towers, Suite 1850
San Francisco, CA 94105-1018
"PURCHASER" TENERA, INC.
By /s/ JEFF HAZARIAN
-----------------------------
Jeff Hazarian,
Chief Financial Officer
27
TRADEMARK LICENSE AGREEMENT
THIS TRADEMARK LICENSE AGREEMENT (this "License") is made and entered
into effective as of November 14, 1997 ("Effective Date") between TENERA,
INC., a Delaware corporation ("Licensor"), and SPEAR TECHNOLOGIES, INC., a
California corporation ("Licensee").
RECITALS AND DEFINITIONS
WHEREAS, pursuant to that certain Asset Acquisition Agreement dated
November 14, 1997 by and among Licensor, TENERA TECHNOLOGIES, LLC, a Delaware
limited liability company ("LLC"), and Licensee, Licensor and LLC have agreed
to sell to Licensee all of the assets and liabilities of Licensor's
performance improvement and computerized maintenance management software
consulting business for the mass transit industry ("Business");
WHEREAS, Licensor is the owner of the entire right, title and
interest in and to the names, marks or designations whether or not registered
as trademarks in connection with which the Business has been conducted and as
set forth in Attachment A (hereinafter referred to as "Trademarks"); and
WHEREAS, in connection with continuing the Business after the
purchase of its assets, Licensee desires for a limited period the right to use
the Trademarks and Licensor is willing to grant such right on the terms and
conditions hereinafter appearing.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and conditions hereinafter set forth, the parties hereto agree as
follows:
I. GRANT AND USE
1.1 Licensor hereby grants to Licensee a world-wide, royalty free,
non-transferable, exclusive license to use the Trademarks only for the term of
this License and solely (i) in the same manner as the Trademarks were used
immediately prior to the Effective Date, and (ii) in connection with the
conduct of the Business as it was conducted immediately prior to the Effective
Date.
1.2 The grant of license includes the right for the term of this
License only, unless earlier terminated by Licensor, to use the name "Tenera
Technologies" as its fictitious business or trade name but not as part of any
registered corporate name. Licensee may only use "Tenera Technologies" in its
entirety as its business or trade name as this grant of License does not
include a license to use the name "Tenera" alone or in connection with any
other
28
<PAGE>
word or any variation thereof as a business or trade name. Licensee shall not
use any other Trademark in its business or trade name. Upon the expiration of
this License or its earlier termination, Licensee shall immediately cease to
use the name "Tenera Technologies" and shall take any and all steps necessary
to commence doing business under a new name which bears no similarity
whatsoever to the name "Tenera."
1.3 Notwithstanding anything to the contrary contained herein,
sublicensing of the Trademarks is not permitted without the prior written
consent of Licensor, except in compliance with the terms of this Agreement to
(i) British Rail Business Systems, (ii) ICL Enterprises, and (iii) IBM.
II. TERM
The term of this License shall be for one year, commencing on the
Effective Date and ending on November 14, 1998.
III. CONDUCT AND USE
3.1 Licensee agrees during the term of this License and while it is
using the Trademarks or the name "Tenera Technologies": (a) to conduct its
business in a manner that reflects favorably at all times on the good name,
goodwill and reputation of Licensor; (b) to avoid deceptive, misleading or
unethical practices that are or might be detrimental to Licensor, including,
but not limited to, disparagement of Licensor; (c) to make no false or
misleading representations with regard to Licensor; and (d) not to publish or
employ or cooperate in the publication or employment of any misleading or
deceptive advertising material.
3.2 Licensee must use the Trademarks in compliance with all
specifications and procedures reasonably prescribed by Licensor. Licensee
will give such notices of Trademark ownership and registration as Licensor
reasonably specifies.
3.3 Unauthorized use of any of the Trademarks, including without
limitation use in connection with any business or commercial practice other
than the Business or use of the name "Tenera" as a business or trade name
alone or in combination with any other word or mark, by Licensee will
constitute infringement of Licensor's rights in the Trademarks or in the name
"Tenera", and any such infringement which is adverse to Licensor will
constitute a material breach of this License.
3.4 Licensee may not use any of the Trademarks: (a) with any
prefix, suffix or other modifying words, terms, designs, or symbols; (b) in
any modified form or in any form that has not been specified by Licensor; or
(c) in selling any product or service not being sold in relation to the
Business on the date of this License.
29
<PAGE>
IV. PACKAGING/APPROVALS
4.1 Licensee, immediately on Licensor's request, shall submit to
Licensor for review, all packaging, labels, advertising and other material on
which the Trademarks appear and Licensee specifically undertakes to amend to
the reasonable satisfaction of Licensor any such packaging, labels,
advertising and other material which are not approved by Licensor, which
approval shall not be unreasonably withheld.
4.2 Licensor has the right, at all reasonable times during business
hours, to inspect any services or products, including without limitation
software products, upon and in connection with which the Trademarks are to be
used as well as the methods of creating such products or providing such
services, if any, in order that Licensor may satisfy itself that the products
or services associated with the Trademarks meet the quality standards approved
by Licensor. Licensee shall submit for Licensor's prior written approval, at
least 30 days prior to their intended distribution, a limited number of
samples of any products, including without limitation working demonstration
copies of any software programs making use of the Trademarks. Licensor may
disapprove any use or appearance of the Trademarks if in Licensor's reasonable
determination such use (a) jeopardizes the validity of any of the Trademarks,
(b) causes disparagement to, reflects badly on or decreases the quality
associated with Licensor or Licensor's products or services (c) does not
conform to previously approved uses of the Trademarks or (d) does not conform
to Licensor's established Trademark presentation and use policies, protocols
or standards, which may vary from time to time.
V. OWNERSHIP
5.1 Licensee acknowledges and agrees that: (a) Licensor owns all
right, title, interest and goodwill in and to the Trademarks; (b) Licensee's
right to use the Trademarks comes solely from this License and is limited to
use in compliance with this License; (c) all use of the Trademarks will inure
to Licensor's exclusive benefit; and that (d) this License does not confer any
goodwill or other interest in the Trademarks upon Licensee. Licensee may not
during or after the term of this License contest the validity or ownership of
any of the Trademarks or assist any other person or entity in doing so.
5.2 Licensor shall continue to be responsible for maintaining the
Trademarks in force.
VI. INFRINGEMENTS
6.1 Licensee shall promptly report to Licensor particulars of any
use by any other party of a Trademark, trade name or model of advertising
which might amount to infringement of the Trademarks or to unfair competition.
6.2 In the event that it comes to the notice of Licensee that any
party alleges that the Trademarks are invalid or that they infringe any rights
of that party or that the
30
<PAGE>
Trademarks are open to any other form of attack, Licensee shall not make any
admissions but shall promptly report the matter to Licensor.
6.3 Licensor shall have the conduct of and responsibility for any
proceeding relating to the Trademarks.
6.4 Licensee agrees to indemnify Licensor (including reasonable
attorneys' fees and cost of litigation) against, and hold Licensor harmless
from, any and all claims by any other party resulting from the provision of
services or products in connection with any Trademarks regardless of the form
of action; provided however, that Licensee shall not be required to indemnify
Licensor for any loss arising from the fact that such Trademark infringes the
rights of any third party.
VII. TERMINATION
7.1 Notwithstanding Section 2.1 hereof, this License may be
terminated immediately by Licensor by written notice to Licensee in the event
of (i) the bankruptcy or judicial or administrative declaration of insolvency,
or the assignment of all or a substantial part of the assets of Licensee to or
for the benefit of any creditor or Licensee admits in writing Licensee's
inability to pay Licensee's debts as they come due; or (ii) Licensee
transfers, sublicenses or attempts to transfer or sublicense this License or
the rights or interests conferred by this License to any other person without
the prior written consent of Licensor.
7.2 Upon termination or expiration of this License, for any reason,
Licensee shall immediately discontinue use of the Trademarks, including the
name "Tenera Technologies", and shall return to Licensor or destroy
immediately all documentation, advertising, promotional materials, packaging
or products marked with the Trademarks.
7.3 If either party shall default in the performance of any of its
obligations under this License and shall fail to remedy such default within 30
days written notice thereof by the other party calling attention to such
default, then the injured party, by written notice, may terminate this
License.
7.4 Termination of this License shall be without prejudice to any
rights accruing prior to the date of termination.
7.5 No waiver of any breach of this License shall constitute a
waiver of any subsequent or other breach.
VIII. NOTICES
All notices, requests, demands and other communications hereunder shall
be deemed to have been duly given if the same shall be in writing and shall be
delivered personally or sent by
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<PAGE>
registered or certified mail, postage prepaid or by reputable overnight
courier (e.g. Federal Express) and addressed as set forth below:
If to Licensor: Tenera, Inc.
One Market, Spear Tower
Suite 1850
San Francisco, CA 94105
Attention: Chief Executive Officer
copy to:
Bryan Cave LLP
120 Broadway, Suite 500
Santa Monica, Ca 90401
Attention: Thomas Loo, Esq.
If to Licensee: Spear Technologies, Inc.
One Market, Spear Tower
Suite 1850
San Francisco, CA 94105
Attention: Michael D. Thomas
copy to:
Gray Cary Ware & Freidenrich
400 Hamilton Avenue
Palo Alto, CA 94301
Attention: Thomas Furlong, Esq.
Any such notice personally served shall be deemed received upon
receipt. Any notice sent by mail, certified or registered, shall be deemed
received three (3) business days after deposit in the mail. Any notice sent by
reputable overnight courier shall be deemed received on the next business day
following deposit with the courier. Any party may change the address to which
notices are to be addressed by giving the other parties notice in the manner
herein set forth.
IX. ASSIGNMENT; BINDING AGREEMENT
9.1 Neither this Agreement nor any of the rights or obligations
hereunder may be assigned without prior written consent of the Parties.
9.2 This Agreement shall be binding upon, and shall inure to the
benefit of the Parties and their respective successors and permitted assigns.
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X. MISCELLANEOUS
10.1 This License is made pursuant to and shall be governed by the
law of the State of California without regard to its principles of conflicts
of laws.
10.2 The titles of paragraphs used in this License shall in no
event be read as part of this License.
10.3 In the event of a breach or threatened breach of any of
Licensee's duties and obligations under the terms and conditions of this
License, Licensor shall be entitled, in addition to any other legal or
equitable remedies it may have in connection therewith (including any right to
damages that it may suffer), to temporary, preliminary and permanent
injunctive relief restraining such breach or threatened breach. Licensee
hereby expressly acknowledges that the harm which might result to Licensor's
business as a result of any noncompliance by Licensee with any the provisions
of this License would be largely irreparable.
IN WITNESS WHEREOF, the parties hereto have caused this License to be
executed by their duly authorized officers and their corporate seals affixed
as of the day and year first written above.
Licensor
TENERA, INC.,
a Delaware corporation
By: /s/ JEFFREY R. HAZARIAN
----------------------------------
Name: Jeffrey R. Hazarian
Title: Chief Financial Officer
Licensee
SPEAR TECHNOLOGIES, INC.,
a California corporation
By: /s/ MICHAEL D. THOMAS
----------------------------------
Name: Michael D. Thomas
Title: Chief Executive Officer
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ATTACHMENT A
LICENSED TRADEMARKS
Mark Registration
1. TENERA & Design U.S. trademark
2. TENERA & Design U.S. service mark
3. TENERA U.S. trademark
4. TENERA U.S. service mark
5. TENERA 2000 I.T.U. trademark application
34
