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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): OCTOBER 10, 1997
OMNIS TECHNOLOGY CORPORATION
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(Exact name of registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 0-16449 94-3046892
(State or jurisdiction of (Commission File Number) (I.R.S. Employer Identification No.)
incorporation or organization)
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851 TRAEGER AVENUE
SAN BRUNO, CALIFORNIA 94066
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(Address, including zip code, of principal executive offices)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (650) 829-6000
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
(a) On October 10, 1997, OMNIS Technology Corporation (the "Company")
filed with the Secretary of State of Delaware a Certificate of Amendment to its
Restated Certificate of Incorporation. The Company's Restated Certificate of
Incorporation, as amended and corrected, is filed herewith as Exhibit 3.1.
(b) Pursuant to Note Purchase Agreements dated October 14, 1997 and
October 31, 1997, the Company borrowed $1,000,000.00 from a significant
stockholder (the "Loans"). Copies of the Note Purchase Agreements are filed
herewith as Exhibits 10.1 and 10.2. The maturity date for each of the Loans,
which originally was March 31, 1998, was extended to June 30, 1998. The Company
does not expect to repay the note by June 30, 1998, and is negotiating an
extension to the maturity date. There can be no assurance that the Company will
be able to extend the maturity date of the Loans. The Company currently is not
able to pay-off the Loans in their entirety, and if the maturity date is not
extended, the Company may be forced to file for bankruptcy.
(c) On April 14, 1998 the Company issued a press release announcing that
it has agreed to sell up to 126,000 shares of Series A preferred stock, at a
price of $.80 per share, to a significant stockholder. A copy of the press
release issued on April 14, 1998 is filed herewith as Exhibit 99.1. Each share
of preferred stock converts into 10 shares of common stock. Concurrent with the
execution of this agreement, the Company sold the first 50,000 shares of Series
A preferred stock. On May 22, 1998 the Company sold an additional 12,500 shares
of Series A preferred stock. These proceeds will be used to fund the Company's
operations designed to achieve profitability and the expansion of its U.S. based
sales & marketing programs. The purchaser has the right to purchase additional
shares until October 1, 1998. The proceeds from the sale of such shares were
used to fund future working capital requirements. A copy of the Certificate of
Designations, as corrected, filed by the Company with the Secretary of State of
Delaware and authorizing the Series A Preferred Stock is filed herewith as
Exhibit 3.2. A copy of the Stockholder Rights Agreement entered into between the
Company and the stockholder is filed herewith as Exhibit 4.1. A copy of the
Purchase Agreement entered into between the Company and the stockholder is filed
herewith as Exhibit 10.3.
(d) On May 21, 1998 the Company issued a press release announcing the
appointment of two senior executives to direct the Company's worldwide sales and
marketing campaign. A copy of the press release issued on May 21, 1998 is filed
herewith as Exhibit 99.2. Copies of the employee agreements entered into between
the Company and each of the senior executives are filed herewith as Exhibits
10.4 and 10.5.
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Item 7. Exhibits.
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EXHIBIT
NUMBER DESCRIPTION
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3.1 Restated Certificate of Incorporation, as amended and corrected.
3.2 Certificate of Designations, as corrected.
4.1 Shareholder Rights Agreement dated as of April 1, 1998.
10.1 Note Purchase Agreement dated as of October 14, 1997.
10.2 Note Purchase Agreement dated as of October 31, 1997.
10.3 Series A Convertible Preferred Stock Purchase Agreement dated as
of April 1, 1998.
10.4 Employee Agreement between the Company and Kevin Doyle dated
April 1, 1998.
10.5 Employee Agreement between the Company and Larry Barcot dated
April 1, 1998.
99.1 Press Release dated April 14, 1998.
99.2 Press Release dated May 21, 1998.
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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 hereunto duly authorized.
OMNIS TECHNOLOGY CORPORATION
Dated: June 15, 1998 By:/s/ Kenneth P. Holmes
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Kenneth P. Holmes
Interim Chief Executive Officer and
Chief Financial Officer
(Principal Executive and Financial Officer)
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INDEX TO EXHIBITS FILED WITH THE CURRENT REPORT ON FORM 8-K
DATED OCTOBER 10, 1997
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EXHIBIT
NUMBER DESCRIPTION
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3.1 Restated Certificate of Incorporation, as amended and corrected.
3.2 Certificate of Designations, as corrected.
4.1 Shareholder Rights Agreement dated as of April 1, 1998.
10.1 Note Purchase Agreement dated as of October 14, 1997.
10.2 Note Purchase Agreement dated as of October 31, 1997.
10.3 Series A Convertible Preferred Stock Purchase Agreement dated as
of April 1, 1998.
10.4 Employee Agreement between the Company and Kevin Doyle dated
April 1, 1998.
10.5 Employee Agreement between the Company and Larry Barcot dated
April 1, 1998.
99.1 Press Release dated April 14, 1998.
99.2 Press Release dated May 21, 1998.
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Exhibit 3.1
CERTIFICATE OF AMENDMENT
OF
RESTATED CERTIFICATE OF INCORPORATION
OF BLYTH HOLDINGS INC.
Blyth Holdings, Inc., a corporation organized and existing under and by
virtue of the General Corporation law of the State of Delaware (the
"Corporation") does hereby certify as follows:
FIRST: That the Board of Directors of the Corporation by unanimous
written consent of its members, filed with the minutes of the Board, duly
adopted resolutions setting forth a proposed amendment to the Restated
Certificate of Incorporation of said corporation, declaring said amendment to be
advisable and calling for the submission of the matter to the stockholders of
the Corporation for consideration and approval. The resolutions setting forth
the proposed amendment are as follows:
"RESOLVED: That Article First of the Restated Certificate of
Incorporation be amended to read as follows:
FIRST. The name of the corporation is OMNIS Technology Corporation.
RESOLVED: That Article Fourth of the Restated Certificate of
Incorporation be amended to read as follows:
FOURTH.
4.1 This corporation is authorized to issue two classes of stock to be
designated, respectively, "common" and "preferred." The number of common shares
authorized is 4,000,000, each with a par value of $0.10. The number of preferred
shares authorized is 300,000, each with the par value of $1.00.
4.2 Upon the filing of this Certificate of Amendment with the Secretary
of State of Delaware, each ten (10) currently outstanding shares of Common Stock
of the Company shall be consolidated and combined into one share of Common
Stock. No fractional shares of Common Stock shall be issued upon such reverse
stock split; any fractional shares that would otherwise result as to any holder
shall be rounded up to the nearest whole share."
SECOND: That thereafter, pursuant to the resolution of its Board of
Directors, the amendment of the Restated Certificate of Incorporation was
approved by a majority of the stockholders of the corporation at its Annual
Meeting of Stockholders.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
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IN WITNESS WHEREOF, Blyth Holdings Inc. has duly caused this Certificate
of Amendment to be signed and attested by its duly authorized officers this 17th
day of September, 1997.
By:_________________________________
Timothy P. Negris, President
Attest
By:_________________________________
Judith M. O'Brien, Secretary
2
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RESTATED CERTIFICATE
OF INCORPORATION
OF BLYTH HOLDINGS INC.
Pursuant to Section 245 of the Delaware Corporation Law of the
State of Delaware, the undersigned Stephen R. Lorentzen and Judith
M. O'Brien hereby certify as follows:
1. They are the duly elected and acting President and Chief
Operating Officer and Secretary, respectively, of Blyth Holdings Inc. (the
"Corporation").
2. The name of the corporation is Blyth Holdings Inc.
3. The original Certificate of Incorporation of the corporation
was filed with the Secretary of State of Delaware on August 5, 1987.
4. Pursuant to Sections 242 and 245 of the Delaware General
Corporation Law, this Restated Certificate of Incorporation restates, integrates
and amends in its entirety the provisions of the Corporation's Certificate of
Incorporation and shall hereafter read in its entirety as follows:
FIRST. The name of the corporation is Blyth Holdings Inc.
SECOND. The address of the corporation's registered office in the State
of Delaware is 1209 Orange Street, Wilmington, County of New Castle, Delaware
19801. The name of its registered agent at such address is The Corporation Trust
Company.
THIRD. The nature of the business or purposes to be conducted or
promoted is to engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of Delaware.
FOURTH. This corporation is authorized to issue two classes of stock to
be designated, respectively, "common" and "preferred." The number of common
shares authorized is 40,000,000, each with a par value of $0.01. The number of
preferred shares authorized is 3,000,000, each with the par value of $1.00.
FIFTH. The preferred stock authorized by this Restated Certificate of
Incorporation shall be issued from time to time in series. Except as otherwise
provided in this Restated Certificate
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of Incorporation, the Board of Directors is hereby authorized to fix the number
of shares, and determine the designation of each series of preferred shares and
may determine or alter the rights, preferences, privileges, and restrictions
granted to or imposed on any wholly unissued class of shares or any wholly
unissued series of any class of shares. As to any series the number of shares of
which is fixed by the Board as herein authorized, the Board may, within any
limits and restrictions stated in the resolution or resolutions of the Board
originally fixing the number of shares constituting any series, increase or
decrease (but not below the number of shares of such series then outstanding)
the number of shares of any such series subsequent to the issue of shares of
that series. In case the number of shares of any series shall be so decreased,
the shares constituting the decrease shall resume the status which they had
prior to the adoption of the resolution originally fixing the number of shares
of that series.
SIXTH. The number of directors which shall constitute the whole board of
directors of this corporation shall be seven (7). The directors shall serve for
terms of three years each; provided that of the initial seven (7) directors, two
(2) shall be elected to terms ending at the annual meeting of stockholders in
1988, two (2) shall be elected to terms ending at the annual meeting of
stockholders in 1989, and three (3) shall be elected to terms ending at the
annual meeting of stockholders in 1990. All directors of this corporation may be
removed with or without cause. This article may be amended, altered, modified or
repealed only with the affirmative vote of the holders of two-thirds (2/3) of
the outstanding voting shares.
SEVENTH. The Corporation is to have perpetual existence.
EIGHTH. No director of the corporation shall be held personally liable
for monetary damages for breach of fiduciary duty as a director, provided that a
director may be liable: (a) for any breach of the director's duty of loyalty to
the corporation or its stockholders; (b) for acts or omissions not in good faith
or which involve intentional misconduct or a knowing violation of law; (c) for
any violation of Section 174 of the Delaware General Corporation Law; or, (d)
for any transaction from which the director derived an improper personal
benefit.
5. This Restated Certificate of Incorporation has been duly
adopted by the Corporation's Board of Directors in accordance with Section 245
of the General Corporation Law of the State of Delaware. This Restated
Certificate of Incorporation was duly adopted by a majority of the shares
entitled to vote at the 1996 Annual Meeting of Stockholders of the corporation
held on August 20, 1996, in accordance with the applicable provisions of
Sections
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222, 242, and 245 of the General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, Blyth Holdings Inc. has caused this Restated
Certificate of Incorporation to be signed by Stephen R. Lorentzen, its President
and Chief Operating Officer, and attested by Judith M. O'Brien, its Secretary,
on this _____ day of September, 1996.
BLYTH HOLDINGS INC.
-----------------------------------
Stephen R. Lorentzen, President and
Chief Operating Officer
Attest:
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Judith M. O'Brien, Secretary
Acknowledged this _____ day of
September, 1996.
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Stephen R. Lorentzen, President and
Chief Operating Officer
3
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Exhibit 3.2
CERTIFICATE OF DESIGNATION
OF
SERIES A PREFERRED STOCK
OF
OMNIS TECHNOLOGY CORPORATION
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
Omnis Technology Corporation, a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), in
accordance with the provisions of Section 151(g) thereof, DOES HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors by
the Restated Certificate of Incorporation, as amended, of the said Corporation,
the said Board of Directors adopted on March 31, 1998 the following resolutions
creating a series of preferred stock designated as "Series A Preferred Stock"
("Series A Preferred Stock" or "Preferred Stock"):
"RESOLVED: That pursuant to the authority vested in the Board of
Directors of the Corporation by the Amended and Restated Certificate of
Incorporation, the Board of Directors does hereby provide for the issue of
Preferred Stock, $1.00 par value, of the Corporation, to be designated "Series A
Preferred Stock," initially consisting of 124,564 shares and to the extent that
the designations, powers, preferences and relative and other special rights and
the qualifications, limitations and restrictions of the Series A Preferred Stock
are not stated and expressed in the Amended and Restated Certificate of
Incorporation, does hereby fix and herein state and express such designations,
powers, preferences and relative and other special rights and the
qualifications, limitations and restrictions thereof, as follows (all terms used
herein which are defined in the Amended and Restated Certificate of
Incorporation shall be deemed to have the meanings provided therein):
1. Designation and Amount. The shares of such series shall be designated
as "Series A Preferred Stock," par value $1.00 per share, and the number of
shares constituting such series shall be 124,564.
2. Dividends. The holders of shares of Series A Preferred Stock shall be
entitled to receive a dividend equal to 0.10 (the "Dividend Rate") of the
Original Issue Price (as defined and adjusted pursuant to Section 4 hereof) in
preference to the common stock of the Corporation (the "Common Stock") (the
"Preferred Dividend"), payable on shares of Series A Preferred Stock held as of
April 1 of each of the years 1999, 2000, 2001 and 2002. The Preferred Dividend
shall be cumulative and shall be payable by the Corporation in shares of Common
Stock by adjusting the Original Issue Price (the "Adjusted Original Issue
Price") pursuant to the following formula: Adjusted Original Issue Price =
Original Issue Price * (1 + (Dividend Rate * N)), where N is equal to 0 prior to
April 1, 1999, 1 from April 1, 1999 to March 31, 2000, 2 from April 1, 2000 to
March 31,
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2001, 3 from April 1, 2001 to March 31, 2002 and 4 on and after April 1, 2002.
No Preferred Dividend shall accrue to the Series A Preferred after April 1,
2002. The Original Issue Price is equal to $8.028, as adjusted to reflect any
stock split, stock dividend, combination, recapitalization and the like of the
Series A Preferred Stock.
3. Liquidation Rights. In the event of any liquidation, dissolution or
winding up of the Corporation, whether voluntary or involuntary, a distribution
shall be made to the holders of Series A Preferred Stock in respect of such
Series A Preferred Stock before any amount shall be paid to the holders of
Common Stock in respect of such Common Stock, in the following manner:
(a) Series A Preferred Stock. The holders of Series A Preferred
Stock shall be entitled to be paid first out of the assets of the Corporation
available for distribution to holders of its capital stock an amount per share
equal to (i) the Adjusted Original Issue Price, plus (ii) all accrued or
declared but unpaid dividends, if any (other than as defined in Section 2). If,
upon the occurrence of a liquidation, dissolution or winding up, the assets and
funds thus distributed among the holders of the Series A Preferred Stock shall
be insufficient to permit the payment to such holders of their full liquidation
preference, then the entire assets and funds of the Corporation legally
available for distribution to the holders of capital stock shall be distributed
ratably among the holders of the Series A Preferred Stock.
If assets are remaining after payment in accordance with the
foregoing paragraph, then the entire remaining assets and funds of the
Corporation shall be distributed among the holders of the Common Stock in
proportion to the shares of Common Stock then held by them.
(b) Events Deemed a Liquidation. For purposes of this Section 3,
a liquidation, dissolution or winding up of the Corporation shall be deemed to
be occasioned by or to include the consolidation or merger of the Corporation
with or into any other corporation or entity or the sale or other transfer in a
single transaction or a series of related transactions of all or substantially
all of the assets of this Corporation, or any other reorganization of this
Corporation where the stockholders of the Corporation immediately prior to such
transactions(s) do not retain at least fifty percent (50%) of the voting power
of and interest in the successor entity. Not later than fourteen (14) days prior
to the consummation of any such transaction(s), the Corporation shall deliver a
notice to each holder of Series A Preferred Stock setting forth the principal
terms of such transaction(s), such notice to be delivered in accordance with
Section 4(i) below. After the receipt of such notice, and prior to the
consummation of such transaction(s), any holder of shares of Series A Preferred
Stock may notify the Corporation of such holder's election to convert such
shares into Common Stock pursuant to section 4(a)(i) below, with such conversion
to be contingent upon, and effective immediately prior to, the consummation of
such transaction(s).
(c) Valuation of Property. In the event the Corporation proposes
to distribute assets other than cash in connection with any liquidation,
dissolution or winding up of the Corporation, the value of the assets to be
distributed to the holders of shares of Series A Preferred Stock shall be
determined in good faith by the Board of the Directors of the Corporation,
except that
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any securities to be distributed to stockholders in a liquidation, dissolution
or winding up of the Corporation shall be valued as follows:
(i) if the securities are then traded on a national
securities exchange or the Nasdaq National Market System (or similar national
quotation system), the value shall be deemed to be the average of the closing
prices of the securities on such exchange or system over the 30-day period
ending three (3) days prior to the distribution;
(ii) if actively traded over-the-counter, then the value
shall be deemed to be the average of the closing bid prices over the 30-day
period ending three (3) days prior to the liquidation, dissolution or winding up
of the Corporation; and
(iii) if there is no active public market, then the value
shall be the fair market value thereof, as determined in good faith by the Board
of Directors of the Corporation.
4. Conversion. The holders of Series A Preferred Stock have conversion
rights as follows:
(a) Right to Convert. Each share of Series A Preferred shall be
convertible, at the option of the holder thereof, at any time after the date of
issuance of such share, at the office of this corporation or any transfer agent
for the Series A Preferred, into such number of fully paid and nonassessable
shares of Common Stock as is determined by dividing the Adjusted Original Issue
Price (as defined in Section 2 hereof) by the then effective Series A Conversion
Price (as defined below), as last adjusted on the date the certificate is
surrendered for conversion. The conversion price per share at which shares of
Common Stock shall be issuable upon conversion of shares of the Series A
Preferred after the date hereof shall be $0.8028 (the "Conversion Price");
provided, however, that the Conversion Price shall be subject to adjustment as
set forth in subparagraphs (c) and (d) of this Section 4.
(b) Mechanics of Conversion. Before any holder of Series A
Preferred Stock shall be entitled to convert the same into shares of Common
Stock and to receive certificates therefor, he or she shall surrender the
certificate or certificates therefor, duly endorsed, at the office of the
Corporation or of any transfer agent for the Series A Preferred Stock and shall
give written notice to the Corporation at such office that he or she elects to
convert the same, provided that the Corporation shall not be obligated to issue
certificates evidencing the shares of Common Stock issuable upon such automatic
conversion unless and until the certificates evidencing such shares of Series A
Preferred Stock are either delivered to the Corporation or its transfer agent as
provided above, or the holder notifies the Corporation or its transfer agent
that such certificates have been lost, stolen or destroyed and executes an
agreement satisfactory to the Corporation to indemnify the Corporation from any
loss incurred by it in connection with such certificates. The Corporation shall,
as soon as practicable after such delivery, or after such agreement and
indemnification, issue and deliver at such office to such holder of Series A
Preferred Stock, a certificate or certificates for the number of shares of
Common Stock to which he or she shall be entitled as aforesaid and a check
payable to the holder in the amount of any accrued or declared but unpaid
dividends, if any. Such
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conversion shall be deemed to have been made immediately prior to the close of
business on the date of such surrender of the shares of Series A Preferred Stock
to be converted.
(c) Adjustments to Conversion Price for Diluting Issues.
(i) Special Definitions. For purposes of this Section
4(c), the following definitions shall apply:
(A) 'Options' shall mean rights, options or
warrants to subscribe for, purchase or otherwise acquire either Common Stock or
Convertible Securities.
(B) 'Original Issue Date' shall mean the date on
which the first share of the Series A Preferred was first issued.
(C) 'Convertible Securities' shall mean any
evidences of indebtedness, shares (other than the Preferred Stock) or other
securities convertible into or exchangeable by their terms for Common Stock.
(D) 'Additional Shares of Common Stock' shall mean
all shares of Common Stock issued (or, pursuant to Section 4(c)(iii), deemed to
be issued) by the Corporation after the Original Issue Date, other than shares
of Common Stock issued or issuable at any time:
(1) upon issuance of the Preferred
Stock;
(2) upon conversion of the Preferred
Stock into Common Stock;
(3) to officers, directors, and
employees of, and consultants to, the Corporation pursuant to plans,
arrangements or agreements approved by the Board of Directors not to exceed
1,200,000 shares; provided, however, that shares issued or issuable pursuant to
this clause (D)(3) which are canceled or forfeited may be reissued pursuant to
this clause (D)(3) without being counted against the 1,200,000 share limitation;
(4) in connection with bona fide
equipment lease transactions, loan guarantees, commercial loans, bank financing
transactions or technology licenses approved by the Board of Directors;
(5) pursuant to the acquisition of a
company or other entity or division thereof by the Corporation by merger,
purchase of assets, or other acquisition or reorganization approved by the Board
of Directors whereby the Corporation owns not less than fifty-one (51%) of the
voting power of such other company or entity or of the fair market value of the
division thereof;
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(6) pursuant to a joint venture
arrangement or other strategic financing arrangement, so long as such issuance
is not primarily for equity financing purposes; or
(7) any other securities issued in
respect of the Preferred Stock, or the Common Stock excluded from the definition
of Additional Shares of Common Stock by this Subparagraph D, upon any stock
split, stock dividend, consolidation, recapitalization or similar event for
which an adjustment is made to the Conversion Price pursuant to Section 4(d)
hereof.
(ii) No Adjustment of Conversion Price. No adjustment in
the then applicable Conversion Price of a share of Preferred Stock shall be made
in respect of the issuance of Additional Shares of Common Stock unless the
consideration per share for an Additional Share of Common Stock issued or deemed
to be issued by the Corporation is less than the respective Conversion Price in
effect on the date of, and immediately prior to such issue, for such share of
Preferred Stock.
(iii) Deemed Issue of Additional Shares of Common Stock.
Except as otherwise provided in Section 4(c)(i), in the event the Corporation at
any time or from time to time after the Original Issue Date shall issue any
Options or Convertible Securities or shall fix a record date for the
determination of holders of any class of securities entitled to receive any such
Options or Convertible Securities, then the maximum number of shares (as set
forth in the instrument relating thereto without regard to any provisions
contained therein for a subsequent adjustment of such number) of Common Stock
issuable upon the exercise of such Options or, in the case of Convertible
Securities and Options therefor, the conversion or exchange of such Convertible
Securities, shall be deemed to be Additional Shares of Common Stock issued as of
the time of such issue or, in case such a record date shall have been fixed, as
of the close of business on such record date, provided that Additional Shares of
Common Stock shall not be deemed to have been issued with respect to the
Preferred Stock unless the consideration per share (determined pursuant to
Section 4(c)(v) hereof) of such Additional Shares of Common Stock would be less
than the then applicable Conversion Price of Preferred Stock in effect on the
date of and immediately prior to such issue, or such record date, as the case
may be, and provided further that in any such case in which Additional Shares of
Common Stock are deemed to be issued:
(A) no further adjustment in the Conversion Price
shall be made upon the subsequent issue of Convertible Securities or shares of
Common Stock upon the exercise of such Options or conversion or exchange of such
Convertible Securities;
(B) if such Options or Convertible Securities by their
terms provide, with the passage of time or otherwise, for any increase in the
consideration payable to the Corporation, or decrease in the number of shares of
Common Stock issuable, upon the exercise, conversion or exchange thereof, the
Conversion Price computed upon the original issue thereof (or upon the
occurrence of a record date with respect thereto), and any subsequent
adjustments based thereon, shall, upon any such increase or decrease becoming
effective, be recomputed to reflect such
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increase or decrease insofar as it affects such Options or the rights of
conversion or exchange under such Convertible Securities;
(C) upon the expiration of any such Options or any
rights of conversion or exchange under such Convertible Securities which shall
not have been exercised, the Conversion Price computed upon the original issue
thereof (or upon the occurrence of a record date with respect thereto), and any
subsequent adjustments based thereon, shall, upon such expiration, be recomputed
as if:
(1) in the case of Convertible
Securities or Options for Common Stock, the only Additional Shares of Common
Stock issued were shares of Common Stock, if any, actually issued upon the
exercise of such Options or the conversion or exchange of such Convertible
Securities and the consideration received therefor was the consideration
actually received by the Corporation for the issue of all such Options, whether
or not exercised, plus the consideration actually received by the Corporation
upon such exercise, or for the issue of all such Convertible Securities which
were actually converted or exchanged, plus the additional consideration, if any,
actually received by the Corporation upon such conversion or exchange, and
(2) in the case of Options or
Convertible Securities, only the Convertible Securities, if any, actually issued
upon the exercise thereof were issued at the time of issue of such Options, and
the consideration received by the Corporation for the Additional Shares of
Common Stock deemed to have been then issued was the consideration actually
received by the Corporation for the issue of all such Options, whether or not
exercised, plus the consideration deemed to have been received by the
Corporation upon the issue of the Convertible Securities with respect to which
such Options were actually exercised;
(D) no readjustment pursuant to clause (2) or (3)
above shall have the effect of increasing the Conversion Price to an amount
which exceeds the lower of (i) the Conversion Price on the original adjustment
date, or (ii) the Conversion Price that would have resulted from any issuance of
Additional Shares of Common Stock between the original adjustment date and such
readjustment date; and
(E) in the case of any Options which expire by their
terms not more than 30 days after the date of issue thereof, no adjustment of
the Conversion Price shall be made until the expiration or exercise of all such
Options.
(iv) Adjustment of Conversion Price Upon Issuance of
Additional Shares of Common Stock. In the event this corporation shall issue
Additional Shares of Common Stock (including Additional Shares of Common Stock
deemed to be issued pursuant to Section 4(c)(iii)) without consideration or for
a consideration per share less than the applicable Conversion Price in effect on
the date of and immediately prior to such issue, then and in such event, the
then applicable Conversion Price, as the case may be, shall be reduced,
concurrently with such issue, to a price (calculated to the nearest cent)
determined by multiplying such Conversion Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding immediately
prior
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to such issue plus the number of shares of Common Stock which the aggregate
consideration received by the Corporation for the total number of Additional
Shares of Common Stock so issued would purchase at such Conversion Price; and
the denominator of which shall be the number of shares of Common Stock
outstanding immediately prior to such issue plus the number of such Additional
Shares of Common Stock so issued; provided that, for the purposes of this
Section 4(c)(iv), all shares of Common Stock issuable upon conversion of
outstanding Options, Convertible Securities and the Preferred Stock shall be
deemed to be outstanding, and immediately after any Additional Shares of Common
Stock are deemed issued pursuant to Section 4(c)(iii), such Additional Shares of
Common Stock shall be deemed to be outstanding.
(v) Determination of Consideration. For purposes of this
Section 4(c), the consideration received by the Corporation for the issue of any
Additional Shares of Common Stock shall be computed as follows:
(A) Cash and Property: Such consideration shall:
(1) insofar as it consists of cash, be
computed at the aggregate amount of cash received by the Corporation excluding
amounts paid or payable for accrued interest or accrued dividends;
(2) insofar as it consists of property
other than cash, be computed at the fair value thereof at the time of such
issue, as determined in good faith by the Board; and
(3) in the event Additional Shares of
Common Stock are issued together with other shares or securities or other assets
of the Corporation for consideration which covers both, be the proportion of
such consideration so received, computed as provided in clauses (1) and (2)
above, as determined in good faith by the Board.
(B) Options and Convertible Securities. The
consideration per share received by the Corporation for Additional Shares of
Common Stock deemed to have been issued pursuant to Section 4(c)(iii), relating
to Options and Convertible Securities, shall be determined by dividing
(1) the total amount, if any, received
or receivable by the Corporation as consideration for the issue of such Options
or Convertible Securities, plus the minimum aggregate amount of additional
consideration (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment of such
consideration) payable to the Corporation upon the exercise of such Options or
the conversion or exchange of such Convertible Securities, or in the case of
Options for Convertible Securities, the exercise of such Options for Convertible
Securities and the conversion or exchange of such Convertible Securities by
(2) the maximum number of shares of
Common Stock (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a
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<PAGE> 8
subsequent adjustment of such number) issuable upon the exercise of such Options
or the conversion or exchange of such Convertible Securities.
(d) Adjustments to Conversion Price for Certain Other Events.
(i) Adjustments for Subdivisions, Combinations or
Consolidation of Common Stock. In the event the outstanding shares of Common
Stock shall be subdivided (by stock split, stock dividend, or otherwise), into a
greater number of shares of Common Stock, the Conversion Price then in effect
shall, concurrently with the effectiveness of such subdivision, be
proportionately decreased. In the event the outstanding shares of Common Stock
shall be combined or consolidated, by reclassification or otherwise, into a
lesser number of shares of Common Stock, the Conversion Price then in effect
shall, concurrently with the effectiveness of such combination or consolidation,
be proportionately increased.
(ii) Adjustments for Other Distributions. In the event the
Corporation at any time or from time to time makes, or fixes a record date for
the determination of holders of Common Stock entitled to receive any
distribution payable in securities of the Corporation other than shares of
Common Stock and other than as otherwise adjusted in this Section 4, then and in
each such event provision shall be made so that the holders of Preferred Stock
shall receive upon conversion thereof, in addition to the number of shares of
Common Stock receivable thereupon, the amount of securities of the Corporation
which they would have received had their respective Preferred Stock been
converted into Common Stock on the date of such event and had they thereafter,
during the period from the date of such event to and including the date of
conversion, retained such securities receivable by them as aforesaid during such
period, subject to all other adjustments called for during such period under
this Section 4 with respect to the rights of the holders of the Preferred Stock.
(iii) Adjustments for Reclassification, Exchange and
Substitution. If the Common Stock issuable upon conversion of any series of the
Preferred Stock shall be changed into the same or a different number of shares
of any other class or classes of stock, whether by capital reorganization,
reclassification or otherwise (other than a subdivision or combination of shares
provided for above), the Conversion Price then in effect shall, concurrently
with the effectiveness of such reorganization or reclassification, be
proportionately adjusted such that the respective Preferred Stock shall be
convertible into, in lieu of the number of shares of Common Stock which the
holders would otherwise have been entitled to receive, a number of shares of
such other class or classes of stock equivalent to the number of shares of
Common Stock that would have been subject to receipt by the holders upon
conversion of the respective Preferred Stock immediately before that change.
(e) Status of Converted Stock. In case any shares of Series A
Preferred Stock shall be converted pursuant to Section 4 hereof, the shares so
converted shall be canceled, shall not be reissuable and shall cease to be a
part of the authorized capital stock of the Corporation.
(f) Fractional Shares. In lieu of any fractional shares to which
the holder of Series A Preferred Stock would otherwise be entitled upon
conversion, the Corporation shall pay
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<PAGE> 9
cash equal to such fraction multiplied by the fair market value of one share of
Common Stock as determined by the Board of Directors of the Corporation. The
number of whole shares issuable to each holder upon such conversion shall be
determined on the basis of the number of shares of Common Stock issuable upon
conversion of the total number of shares of Series A Preferred Stock held by
such holder at the time of converting into Common Stock.
(g) Certificate as to Adjustments. Upon the occurrence of each
adjustment or readjustment of the Common Stock conversion ratio pursuant to this
Section 4, the Corporation at its expense shall promptly compute such adjustment
or readjustment in accordance with the terms hereof and furnish to each holder
of Series A Preferred Stock a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based. The Corporation shall, upon the written request at any
time of any holder of Series A Preferred Stock, furnish or cause to be furnished
to such holder a like certificate setting forth (i) such adjustments and
readjustments, (ii) the conversion ration at the time in effect, and (iii) the
number of shares of Common Stock and the amount, if any, of other property which
at the time would be received upon the conversion of Series A Preferred Stock.
(h) No Impairment. The Corporation, whether by amendment of its
Restated Certificate of Incorporation or through any reorganization, transfer of
assets, merger, dissolution, issuance and sale of securities or any other
voluntary action, will not avoid or seek to avoid the observance or performance
of any of the terms to be observed or performed hereunder by the Corporation,
but at all times in good faith will assist in the carrying out of all of such
actions as may be necessary or appropriate in order to protect the conversion
rights pursuant to this paragraph 4 of the holder of the Preferred Stock against
dilution or other impairment.
(i) Notices of Record Date. In the event of any taking by the
Corporation of a record of the holders of any class of securities for the
purpose of determining the holders thereof who are entitled to receive any
dividend (other than a cash dividend) or other distribution, 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, the Corporation
shall mail to each holder of Series A Preferred Stock, at least twenty (20) days
prior to the date specified therein, a notice specifying the date on which any
such record is to be taken for the purpose of such dividend, distribution or
right, and the amount and character of such dividend, distribution or right.
5. Covenants. In addition to any other rights provided by law, so long
as any Series A Preferred Stock shall be outstanding, the Corporation shall not,
without first obtaining the affirmative vote or written consent of the holders
of not less than a majority of such outstanding shares of Series A Preferred
Stock:
(a) amend or repeal any provision of, or add any provision to,
the Corporation's Restated Certificate of Incorporation or Bylaws if such action
would alter or change the rights, preferences, privileges or powers of, or the
restrictions provided for the benefit of, any Series A Preferred Stock, or
increase or decrease the number of shares of Series A Preferred Stock authorized
hereby;
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<PAGE> 10
(b) create, authorize or issue or obligate itself to issue shares
of any class of security, including any other security convertible into or
exercisable for any security, not authorized herein, or reclassify any Common
Stock into shares, having any preference or priority as to dividends, voting,
liquidation preference, conversion or redemption rights superior to or on a
parity with any such preference or priority of the Series A Preferred Stock;
(c) effectuate a merger or consolidation of the Corporation with
or into any other corporation or corporations of other entity, or any other
corporate reorganization, where the stockholders of the Corporation immediately
prior to such event do not retain at least fifty percent (50%) of the voting
power of and interest in the successor entity;
(d) sell, lease or dispose of all or substantially all of the
Corporation's assets; or
(e) effectuate a liquidation, dissolution or winding up of the
Corporation.
6. Voting Rights. Except as otherwise required by law, each share of
Series A Preferred Stock issued and outstanding shall have that number of votes
equal to the number of shares of Common Stock into which it is then convertible.
The holder of each share of Series A Preferred Stock shall be entitled to notice
of any stockholders meeting in accordance with the bylaws of the Corporation and
shall vote with holders of the Common Stock upon the election of directors and
upon any other matter submitted to a vote of stockholders, except those matters
required by law to be submitted to a class vote."
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<PAGE> 11
IN WITNESS WHEREOF, said Omnis Technology Corporation has caused this
Certificate to be signed by Kenneth P. Holmes, its Chief Financial Officer and
Interim Chief Executive Officer, and attested to by Judith M. O'Brien, its
Secretary, this 31st day of March, 1998.
OMNIS TECHNOLOGY CORPORATION,
a Delaware corporation
By:
-------------------------------------
Kenneth P. Holmes,
Chief Financial Officer and
Interim Chief Executive Officer
ATTEST:
-----------------------------------------
Judith M. O'Brien,
Secretary
<PAGE> 1
Exhibit 4.1
OMNIS TECHNOLOGY CORPORATION
SHAREHOLDER RIGHTS AGREEMENT
This Shareholder Rights Agreement (the "Agreement") is made as of this
1st day of April, 1998 by and among Omnis Technology Corporation, a California
corporation (the "Company") and the purchaser of Series A Preferred Stock of the
Company pursuant to that certain Series A Convertible Preferred Stock Purchase
Agreement of even date herewith, and as may be amended from time to time
subsequent to the date hereof (the "Series A Agreement") between the Company and
the purchaser (the "Series A Purchaser" or the "Purchaser").
Recitals
A. Pursuant to the Series A Agreement, the Company shall sell to the
Series A Purchaser up to 124,564 shares of Series A Preferred Stock of the
Company (the "Series A Preferred" or the "Shares") in one or more closings.
B. As an inducement to purchase the Series A Preferred Stock, the
Company desires to grant the Purchaser and certain holders of the Series A
Preferred the rights as set forth herein.
NOW THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the Purchaser and the Company agree as follows:
Agreement
1. Registration Rights. Purchaser shall have registration rights with
respect to (i) shares of the Company's Common Stock issued or issuable in
connection with the conversion of the Shares and (ii) any Common Stock of the
Company issued or issuable in respect of the shares of the Company's Common
Stock or other securities issued or issuable pursuant to the conversion of the
Shares, upon any stock split, stock dividend, recapitalization or similar event
(the "Registrable Securities"), subject to the following terms and conditions:
(a) Registration. The Company shall, promptly on or after six (6)
months after the date hereof, or if the Series A Agreement has been amended to
provide for the sale by the Company of additional shares of Series A Preferred
Stock to Purchaser, then promptly on or after six (6) months from the date of
the most recent amendment, if any, to the Series A Agreement (the "Closing
Date"), file a registration statement (the "Registration Statement") with the
SEC under the Securities Act of 1933, as amended (the "Securities Act") to
effect the registration of the Registrable Securities so as to register the
resale (which shall not be through an underwritten public offering) of the
Registrable Securities; provided, however, that if the Company shall furnish to
Purchaser a certificate signed by the Chief Executive Officer of the Company
stating that, in the good faith judgment of the Board of Directors or Chief
Executive Officer of the Company, it would be seriously detrimental to the
Company and for the Registration Statement to be filed on or before the date
filing would otherwise be required, and it is
<PAGE> 2
therefore in the best interests of the Company to defer the filing of the
Registration Statement, then the Company may delay the filing of the
Registration Statement for a period not in excess of sixty (60) days.
(b) Expenses of Registration. The Company shall pay all
Registration Expenses (as hereafter defined) in connection with any
registration, qualification or compliance pursuant to this Section 1, and
Purchaser shall pay all Selling Expenses (as hereafter defined) and other
expenses that are not Registration Expenses relating to the Registrable
Securities resold by Purchaser. For purposes of this Section 1(b), "Registration
Expenses" shall mean all expenses, except as otherwise stated below, incurred by
the Company in complying with Sections 1(a) and 1(c), including, without
limitation, all registration, qualification and filing fees, printing expenses,
escrow fees, fees and disbursements of counsel for the Company, blue sky fees
and expenses, the expense of any special audits incident to or required by any
such registration and reasonable fees and disbursements, not to exceed
$10,000.00, of one special counsel for Purchaser. For purposes of this Section
1(b), "Selling Expenses" shall mean all selling discounts, commissions and stock
transfer or other taxes applicable to the Registrable Securities.
(c) Registration Procedures. In the case of any registration
effected by the Company pursuant to this Section 1, the Company will keep
Purchaser advised in writing as to the initiation of each registration and as to
the completion thereof. The Company will use commercially reasonable efforts to:
(i) Keep such registration effective until the earlier of
(i) Purchaser having completed the distribution described in the registration
statement relating thereto or (ii) 18 months from the date of such registration;
(ii) Prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement;
(iii) Furnish such number of prospectuses and other
documents incident thereto, including any amendment of or supplement to the
prospectus, as Purchaser from time to time may reasonably request;
(iv) Notify Purchaser so long as it is a holder of
Registrable Securities covered by the Registration Statement at any time when a
prospectus relating thereto is required to be delivered under the Securities Act
of the happening of any event as a result of which the prospectus included in
the Registration Statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of the
circumstances then existing, and at the request of Purchaser, prepare and
furnish to Purchaser a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
the light of the circum-
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<PAGE> 3
stances then existing; provided, however, that the Company may delay the
preparation and filing of any such amendment or supplement (i) to the extent
required by applicable law (in which event the Company shall promptly notify the
Borrower in writing of such requirement of applicable law) or (ii) if such
amendment or supplement would disclose a material financing, acquisition or
other corporate development with respect to the Company and the chief executive
officer or chief financial officer of the Company shall have determined in good
faith (and shall have notified the Borrower in writing of such determination)
that such disclosure is not in the best interest of the Company.
(v) Cause all such Registrable Securities registered
pursuant the Registration Statement to be listed on each securities exchange or
quotation system on which similar securities issued by the Company are then
listed or quoted;
(vi) Provide a transfer agent and registrar for all
Registrable Securities registered pursuant to the Registration Statement and a
CUSIP number for all such Registrable Securities, in each case not later than
the effective date of the Registration Statement; and
(vii) Otherwise use commercially reasonable efforts to
comply with all applicable rules and regulations of the SEC, and make available
to Purchaser, as soon as reasonably practicable, an earnings statement covering
a period of at least twelve months, but not more than eighteen months, beginning
with the first month after the effective date of the Registration Statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act.
(d) Information by Purchaser. Purchaser shall furnish to the
Company such information regarding the distribution proposed by Purchaser as the
Company may reasonably request in connection with any registration,
qualification or compliance referred to in this Section 1. Purchaser covenants
that it will promptly notify the Company of any changes in the information set
forth in the Registration Statement or otherwise provided by Purchaser to the
Company regarding Purchaser or Purchaser's plan of distribution. Without
limiting the generality of the foregoing, any sale or attempted sale by
Purchaser pursuant to the Registration Statement shall be deemed to constitute a
representation by Purchaser that the information in the Registration Statement
with respect to Purchaser and its plan of distribution is true and correct and
does not omit to state a material fact necessary to make such information not
misleading.
(e) Indemnification and Contribution.
(i) The Company agrees to indemnify and hold harmless
Purchaser from and against any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) to which Purchaser may become subject
(under the Securities Act or otherwise) insofar as such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) arise out of, or
are based upon, any untrue statement, alleged untrue statement, omission or
alleged omission of a material fact in the Registration Statement, any
prospectus included in the Registration Statement, or any amendment or
supplement to the Registration Statement or any such prospectus, and the Company
will, as incurred, reimburse Purchaser for any legal or other expenses
reasonably incurred in investigating, defending or
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<PAGE> 4
preparing to defend any such action, proceeding or claim; provided, however,
that the Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon (i) an untrue
statement or omission or alleged untrue statement or omission made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of Purchaser for use in the
preparation of the Registration Statement; (ii) the failure of Purchaser to
comply with any of the covenants and agreements or the inaccuracy of any
representation by Purchaser in this Agreement or pursuant hereto, or (iii) any
untrue statement or omission in any prospectus that is corrected in any
subsequent prospectus that was delivered to Purchaser prior to the pertinent
sale or sales by Purchaser.
(ii) Purchaser agrees to indemnify and hold harmless the
Company from and against any losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) to which the Company may become subject
(under the Securities Act or otherwise) insofar as such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) arise out of, or
are based upon (i) an untrue statement, alleged untrue statement, omission or
alleged omission of a material fact in the Registration Statement, any
prospectus included in the Registration Statement, or any amendment or
supplement to the Registration Statement or any such prospectus in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of Purchaser specifically for use in preparation of the Registration
Statement. Purchaser will, as incurred, reimburse the Company for any legal or
other expenses reasonably incurred in investigating, defending or preparing to
defend any such action, proceeding or claim; provided that the indemnity
agreement contained in this Section 1(e) shall not apply to amounts paid in
settlement of any such action, proceeding or claim if such settlement is
effected without the consent of Purchaser, which consent shall not be
unreasonably withheld; provided further, that in no event shall the indemnity
obligations under this Section 1(e) exceed the net proceeds received from
Purchaser for the purchase of Series A Preferred Stock from the Company pursuant
to the Series A Agreement.
(iii) Promptly after receipt by any indemnified person of
a notice of a claim or the beginning of any action in respect of which indemnity
is to be sought against an indemnifying person pursuant to this Section 1(e),
such indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that, if the indemnifying person shall propose that the same counsel
represent it and the indemnified person, and if counsel for the indemnified
person shall reasonably have concluded that there is an actual conflict of
interest posed by the representation proposed by the indemnifying person, the
indemnified person shall be entitled to retain its own counsel reasonably
satisfactory to the indemnifying person at the expense of such indemnifying
person; provided further, however, that if more than one indemnified person
makes a claim against an indemnifying
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<PAGE> 5
person based on substantially similar facts, the indemnifying person shall not
be responsible for the fees of more than one counsel for all indemnified persons
whose claims are based on substantially similar facts.
(iv) If the indemnification provided for in this Section
1(e) is unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof), in light of the relative fault of
each such party, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or Purchaser on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and Purchaser agree that it would not be
just and equitable if contribution pursuant to this Section 1(e)(iv) were
determined by any method of allocation which does not take account of the
equitable considerations referred to above in this Section 1(e)(iv). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, or liabilities (or actions in respect thereof) referred to above in
this Section 1(e)(iv) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(v) The obligations of the Company and Purchaser under
this Section 1(e) shall be in addition to any liability which the Company and
Purchaser may otherwise have and shall extend, upon the same terms and
conditions, to each director and officer of the Company or Purchaser, and to
each person, if any, who controls the Company or Purchaser within the meaning of
the Securities Act or the Exchange Act.
(f) Restrictions on Transferability. The Registrable Securities
shall not be transferable in the absence of (i) registration under the
Securities Act or an exemption therefrom, (ii) registration or qualification
under the provisions of any applicable blue sky laws or an exemption therefrom,
or (iii) compliance with any term of this Agreement. The Company shall be
entitled to give stop transfer instructions to its transfer agent with respect
to the Registrable Securities in order to enforce the fore going restrictions.
(g) Restrictive Legend. Each certificate representing Registrable
Securities shall bear substantially the following legends (in addition to any
legends required under applicable securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
FOR INVESTMENT PURPOSES ONLY AND HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SHARES MAY
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<PAGE> 6
NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION THEREFROM.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT
BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH
THE SECRETARY OF THE CORPORATION.
The legends contained in this Section 1(g) shall be removed from a certificate
in connection with any sale in compliance with the terms of this Agreement and
pursuant to the Registration Statement or Rule 144 under the Securities Act
("Rule 144"), but shall not be removed in any other circumstance without the
Company's prior written consent in the Company's sole discretion.
(h) Transfer of Shares After Registration.
(i) Purchaser may not make any transfer of any Registrable
Securities except either (i) in accordance with the Registration Statement, in
which case Purchaser must comply with the requirement of delivering a current
Prospectus or (ii) in accordance with Rule 144. Such Registrable Securities are
not transferable on the books of the Company unless the certificate submitted to
the Company's transfer agent evidencing such Registrable Securities is
accompanied by a separate certificate executed by an officer of, or other person
duly authorized by, Purchaser for purposes of establishing compliance with this
Agreement. Such certificate shall be in such form as shall be supplied by the
Company.
(ii) If Purchaser shall propose to sell any Registrable
Securities pursuant to the Registration Statement, it shall notify the Company
in writing of its intent to do so at least three (3) full business days prior to
such sale. For purposes of this Agreement, "business day" shall be any day of
the year, other than a Saturday or Sunday, on which banks in San Francisco,
California generally are open. Such notice shall be deemed to constitute a
representation that any information previously supplied by Purchaser (including
without limitation the information referred to in Section 1(d) hereof) is
accurate as of the date of such notice. At any time within such three (3)
business-day period, the Company may refuse to permit Purchaser to resell any
Registrable Securities pursuant to the Registration Statement; provided,
however, that in order to exercise this right, the Company must deliver a
certificate in writing to Purchaser to the effect that a delay in such sale is
necessary because a sale pursuant to such Registration Statement in its
then-current form would not be in the best interests of the Company, in
accordance with Section 1(c)(iv) of this Agreement. In no event shall such delay
exceed forty-five (45) trading days; provided, however, that if, prior to the
expiration of such forty-five (45) trading day period, the Company delivers a
certificate in writing to Purchaser to the effect that a further delay in such
sale beyond such forty-five (45) trading day period is necessary because a sale
pursuant to such Registration Statement in its then-current form would not be in
the best interests of the Company, the Company may refuse to permit Purchaser to
resell any Registrable Securities pursuant to the Registration Statement for an
additional period not to exceed forty-five (45) trading days. In no event may
the Company exercise
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<PAGE> 7
its right pursuant to this Section 1(h)(ii) to refuse to permit Purchaser to
sell Registrable Securities more than two (2) times in any one calendar year.
2. Rights of First Refusal. The Company hereby grants to Purchaser (so
long as Purchaser holds at least 50,000 shares of Preferred Stock (or 500,000
shares of Common Stock issued on conversion thereof)) the right of first refusal
to purchase its pro rata share of "New Securities" (as defined in this Section
2) that the Company may, from time to time propose to sell and issue. Such pro
rata share, for purposes of this right of first refusal, is the ratio of (X) the
number of shares of Common Stock immediately prior to the issuances of New
Securities then owned by Purchaser or issuable upon the conversion of the Series
A Preferred then owned by Purchaser (including shares issuable upon exercise of
options or warrants held by Purchaser), to (Y) the total number of shares of
Common Stock immediately prior to the issuances of New Securities then
outstanding, after giving effect to the conversion of all outstanding
convertible securities (including the Series A Preferred) and the exercise of
all outstanding options. This right of first refusal shall be subject to the
following provisions:
(a) "New Securities" shall mean any Common Stock and Preferred
Stock of the Company whether or not authorized on the date hereof, and rights,
options, or warrants to purchase Common Stock or Preferred Stock and securities
of any type whatsoever that are, or may become, convertible into Common Stock or
Preferred Stock; provided, however, that "New Securities" does not include the
following:
(i) upon conversion of Preferred Stock into Common Stock;
(ii) to officers, directors, and employees of, and
consultants to, the Corporation pursuant to plans, arrangements or agreements
approved by the Board of Directors not to exceed 1,200,000 shares; provided,
however, that shares issued or issuable pursuant to this clause (a)(ii) which
are canceled or forfeited may be reissued pursuant to this clause (a)(ii)
without being counted against the 1,200,000 share limitation;
(iii) in connection with bona fide equipment lease
transactions, loan guarantees, commercial loans, bank financing transactions or
technology licenses approved by the Board of Directors;
(iv) pursuant to the acquisition of a company or other
entity or division thereof by the Corporation by merger, purchase of assets, or
other acquisition or reorganization approved by the Board of Directors whereby
the Corporation owns not less than fifty-one (51%) of the voting power of such
other company or entity or of the fair market value of the division thereof;
(v) pursuant to a joint venture arrangement or other
strategic financing arrangement, so long as such issuance is not primarily for
equity financing purposes; and
(vi) shares of Common Stock or Preferred Stock issued
pursuant to Section 4 of the Company's Certificate of Designation authorizing
the Shares.
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<PAGE> 8
(b) In the event that Company proposes to undertake an issuance
of New Securities, it shall give Purchaser written notice of its intention,
describing the type of New Securities, the price, and the general terms upon
which the Company proposes to issue the same. Purchaser shall have ten (10)
business days after receipt of such notice to agree to purchase its pro rata
share of such New Securities at the price and upon the terms specified in the
notice by giving written notice to the Company and stating therein the quantity
of New Securities to be purchased.
(c) In the event that Purchaser fails to exercise in full the
right of first refusal within the ten (10) business day period specified above,
the Company shall have one hundred twenty (120) days thereafter to sell (or
enter into an agreement pursuant to which the sale of New Securities covered
thereby shall be closed, if at all, within sixty (60) days from the date of said
agreement) the New Securities respecting which the right of Purchaser was not
exercised at a price and upon terms no more favorable to the purchaser thereof
than specified in the Company's notice. In the event the Company has not sold
the New Securities within such one hundred twenty (120) day period (or sold and
issued New Securities in accordance with the foregoing within sixty (60) days
from the date of such agreement) the Company shall not thereafter issue or sell
any New Securities, without first offering such New Securities to Purchaser in
the manner provided above.
(d) The right of first refusal granted under this Section 2 shall
expire upon the date which is two years from the date hereof.
(e) This right of first refusal is nonassignable.
3. Governing Law. This Agreement and the legal relations between the
parties arising hereunder shall be governed by and interpreted in accordance
with the laws of the State of Delaware. The parties hereto agree to submit to
the jurisdiction of the federal and state courts of the State of Delaware with
respect to the breach or interpretation of this Agreement or the enforcement of
any and all rights, duties, liabilities, obligations, powers, and other
relations between the parties arising under this Agreement.
4. Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties regarding rights to
registration. 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.
5. Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively given
upon delivery to the party to be notified in person or by courier service or
five days after deposit with the United States mail, by registered or certified
mail, postage prepaid, addressed (a) if to the Purchaser, to the Purchaser's
address set forth in the Series A Agreement, or at such other address as the
Purchaser shall have furnished to the Company in writing, (b) if to any other
holder of any Registrable Securities, to such address as such holder shall have
furnished the Company in writing, or, until any such holder so furnishes an
address to the Company, then to and at the address of the last holder of such
securities who has so furnished an address to the Company
-8-
<PAGE> 9
or (c) if to the Company, to its address set forth on the signature page of this
Agreement the attention of the Corporate Secretary, or at such other address as
the Company shall have furnished to the Holders.
6. 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.
7. Amendment. Any provision of this Agreement may be amended, waived or
modified upon the written consent of the (i) Company, (ii) in the event that the
Purchaser's rights are affected by any such amendment or waiver, the Holders of
a majority of the Registrable Securities and (iii) in all other situations, the
Holders of a majority of the Registrable Securities. Any amendment or waiver
effected in accordance with this Section shall be binding upon each Holder of
Registrable Securities and the Company. The Purchaser may waive any of its
rights or the Company's obligations hereunder without obtaining the consent of
any other person.
8. Headings. Headings and the table of contents in this Agreement are
for reference purposes only and shall not be deemed to have an substantive
effect.
9. Survival. The representations, warranties, covenants, and agreements
made herein shall survive any investigation made by any Holder and the closing
of the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be the representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument.
10. Delay or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any Holder upon breach, default,
or noncompliance of the Company under this Agreement shall impair any such
right, power, or remedy nor shall it be construed to be a waiver of any such
breach, default or noncompliance, or any acquiescence therein, or of any similar
breach, default or noncompliance thereafter occurring, etc.
-9-
<PAGE> 10
IN WITNESS WHEREOF, the undersigned have executed this Shareholder
Rights Agreement as of the date set forth above.
OMNIS TECHNOLOGY CORPORATION ASTORIA CAPITAL PARTNERS, L.P.
A DELAWARE CORPORATION BY: ASTORIA CAPITAL MANAGEMENT, INC.
By: By:
-------------------------------- ----------------------------------
Kenneth P. Holmes, Rick Koe, President
Chief Financial Officer and
Interim Chief Executive Officer
Address: 851 Traeger Avenue Address: 6600 Southwest 92nd Avenue
San Bruno, CA 94066 Suite 370
Fax No.: (650) 829-3429 Portland, OR 97223
Fax No.: (503) 244-3801
[Signature page to Shareholder Rights Agreement]
<PAGE> 1
Exhibit 10.1
================================================================================
BLYTH HOLDINGS INC.
NOTE PURCHASE AGREEMENT
October __, 1997
================================================================================
<PAGE> 2
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
----
<S> <C>
1. The Credit...............................................................................1
1.1 The Advance of Funds..............................................................1
1.2 Closing Date......................................................................1
1.3 Delivery..........................................................................2
1.4 Interest Rate.....................................................................2
1.5 Term..............................................................................2
1.6 Prepayment........................................................................2
1.7 No Usury..........................................................................2
2. Representations and Warranties of the Lender.............................................3
2.1 Experience........................................................................3
2.2 Tax Consequences..................................................................3
2.3 Authority.........................................................................3
2.4 Access to Data....................................................................4
2.5 Reverse Stock Split...............................................................4
3. Representations and Warranties of the Company............................................4
3.1 Corporate Organization and Authority of the Company...............................4
3.2 Corporate Power...................................................................5
3.3 Capitalization....................................................................5
3.4 Authorization.....................................................................6
3.5 No Conflict.......................................................................6
3.6 Accuracy of Reports...............................................................7
3.7 Changes...........................................................................7
3.8 Governmental Consent, etc.........................................................8
3.9 Full Disclosure...................................................................8
4. Conditions of Lender's Obligations at Closing............................................9
4.1 Representations and Warranties....................................................9
4.2 Performance.......................................................................9
4.3 Proceedings Satisfactory; Compliance Certificate..................................9
4.4 Other Agreements..................................................................9
4.5 No Actions Pending...............................................................10
5. Miscellaneous...........................................................................10
5.1 Governing Law....................................................................10
5.2 Successors and Assigns...........................................................10
5.3 Entire Agreement.................................................................10
5.4 Notices, etc.....................................................................10
5.5 Counterparts.....................................................................11
-i-
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
TABLE OF CONTENTS
(CONTINUED)
PAGE
----
<S> <C>
5.6 Severability.....................................................................11
5.7 Headings.........................................................................11
5.8 Survival of Representations and Warranties.......................................11
5.9 Amendment of Agreement...........................................................11
5.10 Finder's Fees....................................................................11
5.11 Expenses.........................................................................12
EXHIBITS
Exhibit A - Form of Secured Promissory Note
Exhibit B - Security Agreement
Exhibit C - Schedule of Exceptions
-ii-
</TABLE>
<PAGE> 4
Note Purchase Agreement
This Note Purchase Agreement (the "Agreement") is entered into as of
October 14, 1997, by and between Blyth Holdings Inc., a Delaware corporation
(a/k/a Omnis Technology Corporation) ("Company"), and Astoria Capital Partners,
L.P., a California limited partnership, ("Lender").
In consideration of the mutual covenants and conditions herein
contained, the parties hereto agree as follows:
1. The Credit
1.1 The Advance of Funds.
(i) Under this Agreement, the Company has authorized the
borrowing of up to $500,000 (the "Credit") in principal amount from Lender.
Lender hereby agrees to make a loan to the Company in the full amount of the
Credit, to be paid to the Company by check or wire transfer on or before the
Closing (as defined below).
(ii) The Company's obligations to the Lender shall be
evidenced by a secured promissory note delivered to the Lender, in the form
attached as Exhibit A hereto (the "Note"), at the time of the Closing.
(iii) The Company's obligations to Lender are secured by
lien on collateral pursuant to a Security Agreement, dated October 14, 1997, in
the form attached hereto as Exhibit B (the "Security Agreement").
1.2 Closing Date. The closing of the purchase and sale of the
Note hereunder shall be held at the offices of Wilson Sonsini Goodrich & Rosati,
650 Page Mill Road, Palo Alto, California at 10:00 a.m., local time, on October
14, 1997 (the "Closing") or at such other time and place upon
<PAGE> 5
which the Company and the Lender shall agree (the date of the Closing is
hereinafter referred to as the "Closing Date").
1.3 Delivery. At the Closing, the Company will issue to Lender
the Note, registered in the Lender's name, representing the principal amount of
the Credit to be loaned by Lender, against the loan of such funds.
1.4 Interest Rate. The outstanding principal balance of the
Credit shall bear interest from the Closing Date until payment in full is made.
The interest rate shall be six percent (6.0%) simple interest per annum;
provided that in no event shall such rate exceed the maximum rate of interest
allowed by applicable law.
1.5 Term. All outstanding principal and interest due under the
Note shall be due and payable as set forth therein.
1.6 Prepayment. The Company may prepay the principal and accrued
interest under the Note according to the terms of Section 2 of the Note.
1.7 No Usury. This Agreement, the Note, the Security Agreement,
and other agreements referred to herein (collectively the "Transaction
Agreements"), and any other agreements which may subsequently be entered into
between the Company and the Lender, are hereby expressly limited so that in no
event whatsoever, whether by reason of deferment or advancement of loan
proceeds, acceleration of maturity of the loan evidenced hereby, or otherwise,
shall the amount paid or agreed to be paid to Lender hereunder for the loan,
use, forbearance or detention of money exceed that permissible under applicable
law. If at any time the performance of any provision hereof or of any other such
agreement involves a payment exceeding the limit of the price that may be
validly charged for the loan, use, forbearance or detention of money under
applicable law, then automatically and retroactively, ipso
-2-
<PAGE> 6
facto, the obligation to be performed shall be reduced to such limit, it being
the specific intent of the Company and Lender hereof that all payments under
this Agreement or the Note are to be credited first to interest as permitted by
law, but not in excess of (i) the agreed rate of interest set forth herein, or
(ii) that permitted by law, whichever is the lesser, and the balance toward the
reduction of principal. The provisions of this paragraph shall never be
superseded or waived and shall control every other provision of the Transaction
Agreements and all other agreements between the Company and Lender.
2. Representations and Warranties of the Lender
Lender hereby represents and warrants to the Company with respect
to the issuance of the Note as follows:
2.1 Experience. It is experienced in evaluating and loaning funds
in high technology companies such as the Company.
2.2 Tax Consequences. It understands and acknowledges that any
financing structured in the manner provided for herein involves certain tax
risks, and therefore it has consulted its own tax advisors regarding all the
federal and state tax consequences of the transactions contemplated by this
Agreement.
2.3 Authority. It has all corporate rights, power and authority
to enter into this Agreement and the Note and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of the Transaction
Agreements by the Lender and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on its behalf. The Transaction Agreements to which Lender is a
signatory have been duly executed and delivered by the Lender, and, to the
extent they impose any obligations on the Lender, constitute legal, valid and
binding obligations of the Lender, enforceable in accordance with their
-3-
<PAGE> 7
respective terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies.
2.4 Access to Data. It has had an opportunity to discuss the
Company's business, management, and financial affairs with its management and
the opportunity to review the Company's facilities. It understands that such
discussions, as well as any written information issued by the Company, were
intended to describe the aspects of the Company's business and prospects which
it believes to be material but were not necessarily a thorough or exhaustive
description.
2.5 Reverse Stock Split. It understands that the Company
consummated a 1:10 reverse stock split of all of the outstanding Common Stock of
the Company, and such reverse stock split was effective October 10, 1997 (the
"Reverse Stock Split").
3. Representations and Warranties of the Company
For purposes of this Section 3, unless the context otherwise
requires, the term "Company" shall include the Company and its subsidiaries as
listed on its most recent Annual Report on Form 10-K for the year ended March
31, 1997, filed with the Securities and Exchange Commission (the "SEC"). Except
as set forth in the Schedule of Exceptions attached hereto as Exhibit D, the
Company represents and warrants to the Lender, as of the Closing Date, as
follows:
3.1 Corporate Organization and Authority of the Company. The
Company and each of its subsidiaries:
(i) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
-4-
<PAGE> 8
(ii) has the corporate power and authority to own and
operate its properties and to carry on its business as presently conducted and
as proposed to be conducted; and
(iii) is qualified to do business as a foreign
corporation in each jurisdiction in which the ownership of its property or the
nature of its business requires such qualification, except where failure to so
qualify would not have a material adverse effect on the business, properties or
financial condition of the Company and its subsidiaries, taken as a whole. The
Company has made available to the Lender true and correct copies of its
Certificate of Incorporation and By-laws as amended.
3.2 Corporate Power. The Company will have at the Closing Date
all requisite legal and corporate power and authority to execute and deliver the
Transaction Agreements, to sell and issue the Note hereunder and to carry out
and perform its obligations under the terms of the Transaction Agreements.
3.3 Capitalization. The authorized capital stock of the Company
consists of:
(i) Common Stock. 4,000,000 shares of Common Stock,
$0.10 par value, of which approximately 2,121,700 shares were issued and
outstanding as of October 8, 1997, taking into account the Reverse Stock Split.
(ii) Preferred Stock. 300,000 shares of Preferred Stock
of which no shares are issued and outstanding, taking into account the Reverse
Stock Split.
(iii) All outstanding shares of the Company's Common
Stock have been duly authorized and validly issued (including, without
limitation, issued in compliance with applicable federal and state securities
laws), and are fully-paid and nonassessable.
(iv) As of September 29, 1997, the Company had reserved
201,876 shares of Common Stock (taking into account the Reverse Stock Split) for
future issuance to employees, officers,
-5-
<PAGE> 9
directors, and consultants of the Company pursuant to employee stock benefit
plans or agreements approved by the Board of Directors. There are no other
options, warrants, conversion privileges or other contractual rights presently
outstanding to purchase or otherwise acquire any shares of the Company's capital
stock or other securities (whether or not authorized).
3.4 Authorization. All corporate action on the part of the
Company, its officers, directors and stockholders necessary for the
authorization, execution, delivery and performance by the Company of all its
obligations under this Agreement, the Security Agreement, the Note and any other
Transaction Agreement has been taken, and this Agreement, the Security Agreement
and the Note, once executed by the Company and the Lender, will constitute
legally binding valid obligations of the Company enforceable in accordance with
their respective terms, such enforceability being subject only to laws of
general application relating to bankruptcy, insolvency and the relief of debtors
and rules of law governing specific performance, injunctive relief or other
equitable remedies. The issuance of the Note will not give rise to any
preemptive rights or rights of first refusal on behalf of any person in
existence on the date hereof.
3.5 No Conflict. The execution and delivery of the Transaction
Agreements do not, and the consummation of the transactions contemplated hereby
and thereby and the performance of the obligations hereunder and thereunder will
not, conflict with, or result in any violation of, or default (with or without
notice or lapse in time, or both), or give rise to a right of termination,
cancellation or acceleration of any obligation or to a loss of a material
benefit, under, any provision of the Certificate of Incorporation or By-laws of
the Company. The execution and delivery of the Transaction Agreements do not,
and the consummation of the transactions contemplated hereby and thereby and the
performance of the obligations hereunder and thereunder will not, conflict with,
or result in any violation of, or default
-6-
<PAGE> 10
(with or without notice or lapse in time, or both), or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit, under, any provision of any mortgage, indenture, lease or
other agreement or instrument, permit, concession, franchise, license, judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to the
Company, its properties or assets, the effect of which could have a material
adverse effect on the Company or materially impair or restrict its power to
perform its obligations as contemplated hereby.
3.6 Accuracy of Reports. The Company's Annual Report on Form 10-K
for the year ended March 31, 1997 filed with the SEC, and all reports required
to be filed by the Company thereafter up to the date of this Agreement under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), copies of
which have been made available to the Lender, have been duly filed, were in
substantial compliance with the requirements of their respective report forms,
were complete and correct in all material respects as of the dates at which the
information was furnished, and contained (as of such dates) no untrue statement
of a material fact nor omitted to state a material fact necessary in order to
make the statements made therein in light of the circumstances in which made not
misleading. Since the date of the latest of such reports, there has not been any
material adverse change in the condition (financial or otherwise) or results of
operations of the Company and its subsidiaries taken as a whole.
3.7 Changes. Except as otherwise disclosed herein, in the
Schedule of Exceptions attached hereto as Exhibit C, in reports filed with the
SEC by the Company under the Exchange Act, and other than continuing financial
losses of the Company, since March 31, 1997, there has not been:
(i) any material change in the assets, liabilities,
financial condition, prospects or operations of the Company from that reflected
in the reports described in Section 3.6 above, except
-7-
<PAGE> 11
changes in the ordinary course of business which have not been, either in any
individual case or in the aggregate, materially adverse;
(ii) any change, except in the ordinary course of
business, in the contingent obligations of the Company, whether by way of
guaranty, endorsement, indemnity, warranty or otherwise;
(iii) any damage, destruction or loss, whether or not
covered by insurance, materially and adversely affecting the properties or
business of the Company;
(iv) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(v) any labor organization activity; or
(vi) to the best of the Company's knowledge, any other
event or condition of any character which has materially adversely affected the
Company's assets, liabilities, financial condition, prospects or operations.
3.8 Governmental Consent, etc. No consent, approval or
authorization of or designation, declaration or filing with any governmental
authority on the part of the Company is required in connection with the valid
execution and delivery of the Transaction Agreements, or the offer, sale or
issuance of the Note, or the consummation of any other transaction contemplated
hereby, except such filings to perfect security interests pursuant to the
Security Agreement and Note.
3.9 Full Disclosure. The representations and warranties of the
Company contained in this Agreement, the other provisions of this Agreement, the
Schedule of Exceptions and the other exhibits, when read together, do not
contain any untrue statement of a material fact or omit to state any
-8-
<PAGE> 12
material fact necessary in order to make the statements contained herein or
therein in light of the circumstances under which they were made not misleading.
4. Conditions of Lender's Obligations at Closing. The obligations of the
Lender under Section 1 of this Agreement are subject to the fulfillment at or
before the Closing of each of the following conditions, any of which may be
waived in writing by the Lender:
4.1 Representations and Warranties. The representations and
warranties of the Company contained in the Security Agreement and in this
Agreement shall be true on and as of such Closing with the same effect as if
made on and as of such Closing.
4.2 Performance. The Company shall have performed or fulfilled
all agreements, obligations and conditions contained herein and in the Security
Agreement required to be performed or fulfilled by the Company before such
Closing.
4.3 Proceedings Satisfactory; Compliance Certificate. All
corporate and legal proceedings taken by the Company in connection with the
transactions contemplated by this Agreement and all documents and papers
relating to such transactions shall be satisfactory to the Lender, in the
reasonable exercise of the judgment of the Lender. The Company shall have
delivered to the Lender a certificate dated as of such Closing, signed by the
President of the Company certifying that the conditions set forth in Sections
4.1 and 4.2 have been satisfied.
4.4 Other Agreements. The Company and the Lender shall have
entered into the Security Agreement, and the Company shall have executed and
delivered such UCC-1 Financing Statements and other Transaction Agreement as the
Lender may require at or before the Closing pertaining to the perfection of the
Security interests granted to the Lender pursuant to the Security Agreement.
-9-
<PAGE> 13
4.5 No Actions Pending. There shall not then be in effect any
order enjoining or restraining the transactions contemplated by the Transaction
Agreements.
5. Miscellaneous
5.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.
5.2 Successors and Assigns. Except as otherwise 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.
5.3 Entire Agreement. The Transaction Agreements and the other
documents delivered hereto and thereto constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof. None of the Transaction Agreements nor any term hereof and
thereof may be amended, waived, discharged or terminated other than by a written
instrument signed by the party against whom enforcement of any such amendment,
waiver, discharge or termination is sought.
5.4 Notices, etc. Any notice and other communications as required
or permitted under the Transaction Agreements shall be mailed, by registered or
certified mail, postage prepaid with return receipt requested, or otherwise
delivered by hand, by messenger or by facsimile (with confirmation of receipt),
addressed (a) if to Lender, at such Lender's address or fax number set forth on
the signature page hereof, or (b) at such other address or fax number as Lender
shall have furnished to the Company in writing, or, in the event someone other
than the Lender becomes the holder of the Note, then to and at the address or
fax number such holder of the Note has furnished to the Company in writing, or
(c) if
-10-
<PAGE> 14
to the Company, at its address or fax number set forth on the signature page
hereof, or at such other address or fax number as the Company shall have
furnished in writing to the Lender or any subsequent holder of the Note.
5.5 Counterparts. This Agreement may be executed in two or more
counterparts, each of which may be executed by less than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
5.6 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to any
party.
5.7 Headings. Headings and the table of contents in this
Agreement are for reference purposes only and shall not be deemed to have any
substantive effect.
5.8 Survival of Representations and Warranties. The
representations and warranties of the parties contained in or made pursuant to
this Agreement and the Security Agreement shall survive the execution and
delivery of this Agreement and the Closing; provided however, that such
representations and warranties need only be accurate as of the date of such
execution and delivery and as of the Closing.
5.9 Amendment of Agreement. Any provision of this Agreement may
be modified or amended by a written instrument signed by the Company and by the
Lender.
5.10 Finder's Fees. Each of the Company and the Lender represents
and warrants to the other that no person is entitled, directly or indirectly, to
compensation by reason of any contract or
-11-
<PAGE> 15
understanding with such party, as a finder or broker in connection with the sale
and purchase of the Note hereunder. Each of the Company and the Lender will
indemnify the other against all liabilities incurred by the indemnifying party
with respect to claims related to investment banking or finders fees in
connection with the transactions contemplated by this Agreement, arising out of
arrangements between the party asserting such claims and the indemnifying party,
and all costs and expenses (including reasonable fees of counsel) of
investigating and defending such claims.
5.11 Expenses. The Company will bear its legal and other fees and
expenses in connection with the transactions contemplated by this Agreement and
will reimburse the Lender for such legal and other fees and expenses up to
$5,000.00.
[THIS SPACE INTENTIONALLY LEFT BLANK]
-12-
<PAGE> 16
The foregoing agreement is hereby executed as of the date first above
written.
BLYTH HOLDINGS INC., ASTORIA CAPITAL PARTNERS, L.P.
A DELAWARE CORPORATION BY: ASTORIA CAPITAL MANAGEMENT, INC.
By: By:
--------------------------- -----------------------------------
Rick Koe, President
Name:
-------------------------
Title:
------------------------
Address: 851 Traeger Avenue Address: 6600 Southwest 92nd Avenue
San Bruno, CA 94066 Suite 370
Fax No.: (650) 571-7174 Portland, OR 97223
Fax No.: (503) 244-3801
Note Purchase Agreement
-13-
<PAGE> 17
EXHIBIT A
FORM OF SECURED PROMISSORY NOTE
<PAGE> 18
EXHIBIT B
SECURITY AGREEMENT
<PAGE> 19
EXHIBIT C
SCHEDULE OF EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
This Schedule of Exceptions is made and given pursuant to Section 3 of
the Note Purchase Agreement dated as of October __, 1997, (the "Agreement") by
and among Blyth Holdings Inc., a Delaware corporation (the "Company") and the
Lender, as defined in the Agreement. Unless the context otherwise requires, all
capitalized terms shall have the meanings as defined in the Agreement. The
section numbers below correspond to the section numbers of the representations
and warranties in the Agreement which are modified by the disclosures; however,
any information disclosed herein under any section number shall be deemed to be
disclosed and incorporated into any other section number under the Agreement
where such disclosure would be appropriate.
Section 3.6 For the quarter ended September 30, 1997, the Company
expects to report a significant financial loss, which shall not be greater than
the loss reported for the quarter ended June 30, 1997.
<PAGE> 1
Exhibit 10.2
================================================================================
OMNIS TECHNOLOGY CORPORATION
OMNIS SOFTWARE, INC.
NOTE PURCHASE AGREEMENT
October 31, 1997
================================================================================
<PAGE> 2
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
----
<S> <C>
1. The Credit...............................................................................1
1.1 The Advance of Funds..............................................................1
1.2 Closing Date......................................................................2
1.3 Delivery..........................................................................2
1.4 Interest Rate.....................................................................2
1.5 Term..............................................................................2
1.6 Prepayment........................................................................3
1.7 No Usury..........................................................................3
2. Representations and Warranties of the Lender.............................................3
2.1 Experience........................................................................3
2.2 Tax Consequences..................................................................4
2.3 Authority.........................................................................4
2.4 Access to Data....................................................................4
2.5 Reverse Stock Split...............................................................4
3. Representations and Warranties of the Company, Parent and Omnis Foreign Subsidiaries.....5
3.1 Corporate Organization and Authority of the Company...............................5
3.2 Corporate Power...................................................................5
3.3 Capitalization....................................................................6
3.4 Authorization.....................................................................7
3.5 No Conflict.......................................................................7
3.6 Accuracy of Reports...............................................................8
3.7 Changes...........................................................................8
3.8 Governmental Consent, etc.........................................................9
3.9 Full Disclosure..................................................................10
3.10 Direct and Indirect Benefits.....................................................10
4. Conditions of Lender's Obligations at Closing...........................................10
4.1 Representations and Warranties...................................................10
4.2 Performance......................................................................10
4.3 Proceedings Satisfactory; Compliance Certificate.................................11
4.4 Other Agreements.................................................................11
4.5 No Actions Pending...............................................................11
5. Miscellaneous...........................................................................11
5.1 Governing Law....................................................................11
5.2 Successors and Assigns...........................................................11
5.3 Entire Agreement.................................................................11
5.4 Notices, etc.....................................................................12
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<PAGE> 3
<TABLE>
<CAPTION>
TABLE OF CONTENTS
(CONTINUED)
PAGE
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<S> <C>
5.5 Counterparts.....................................................................12
5.6 Severability.....................................................................12
5.7 Headings.........................................................................12
5.8 Survival of Representations and Warranties.......................................13
5.9 Amendment of Agreement...........................................................13
5.10 Finder's Fees....................................................................13
5.11 Expenses.........................................................................13
EXHIBITS
Exhibit A - Form of Promissory Note
Exhibit B - Guarantees
Exhibit C - Schedule of Exceptions
-ii-
</TABLE>
<PAGE> 4
Note Purchase Agreement
This Note Purchase Agreement (the "Agreement") is entered into as of
October 31, 1997, by and among Omnis Technology Corporation (f/k/a Blyth
Holdings Inc.) ("Parent"); its wholly-owned direct and indirect subsidiaries
Omnis Software, Inc., a California corporation (the "Company"), Omnis Holdings
Limited, a corporation organized under the laws of England, and Omnis Software
Limited, a corporation organized under the laws of England; and Astoria Capital
Partners, L.P., a California limited partnership ("Lender").
In consideration of the mutual covenants and conditions herein
contained, the parties hereto agree as follows:
1. The Credit
1.1 The Advance of Funds.
(i) Under this Agreement, the Company has authorized the
borrowing of up to $500,000 (the "Credit") in principal amount from Lender.
Lender hereby agrees to make a loan to the Company in the full amount of the
Credit to be paid to the Company by check or wire transfer on or before the
Closing (as defined below).
(ii) The Company's obligations to the Lender shall be
evidenced by a secured promissory note delivered to the Lender, in the form
attached as Exhibit A hereto (the "Note"), at the time of the Closing.
(iii) The Company's obligations to Lender are guaranteed
by (i) Omnis Holdings Limited, a corporation organized under the laws of England
(registered in England under number 1539713) and a wholly-owned subsidiary of
Parent ("Omnis Holdings UK") and (ii) Omnis Software Limited, a corporation
organized under the laws of England (registered in England under
<PAGE> 5
number 1474483) and a wholly-owned subsidiary of Omnis Holdings UK ("Omnis
Software UK") (collectively the "Omnis Foreign Subsidiaries") in the form
attached hereto as Exhibit B (the "Guarantees"). The obligations of the Omnis
Foreign Subsidiaries under the Guarantees are secured by (a) in the case of
Omnis Holdings UK's Guarantee, a lien/charge on property of Omnis Holdings UK as
specified in that certain Legal Charge of even date herewith by Omnis Holdings
UK in favor of Lender, and (b) in the case of Omnis Software UK's Guarantee, a
lien/charge on property of Omnis Software UK as specified in that certain
Debentue of even date herewith by Omnis Software UK in favor of Lender. Said
Legal Charge and Debenture hereinafter are collectively referred to as the
"Security Documents."
1.2 Closing Date. The closing of the purchase and sale of the
Note hereunder shall be held at the offices of Wilson Sonsini Goodrich & Rosati,
650 Page Mill Road, Palo Alto, California at 10:00 a.m., local time, on October
31, 1997 (the "Closing") or at such other time and place upon which the Company
and the Lender shall agree (the date of the Closing is hereinafter referred to
as the "Closing Date").
1.3 Delivery. At the Closing, the Company will issue to Lender
the Note, registered in the Lender's name, representing the principal amount of
the Credit to be loaned by Lender, against the loan of such funds.
1.4 Interest Rate. The outstanding principal balance of the
Credit shall bear interest from the Closing Date until payment in full is made.
The interest rate shall be eight percent (8.0%) simple interest per annum;
provided that in no event shall such rate exceed the maximum rate of interest
allowed by applicable law.
1.5 Term. All outstanding principal and interest due under the
Note shall be due and payable as set forth therein.
-2-
<PAGE> 6
1.6 Prepayment. The Company may prepay the principal and accrued
interest under the Note according to the terms of Section 2 of the Note.
1.7 No Usury. This Agreement, the Note, the Guarantees, the
Security Documents, and any other agreements referred to herein (collectively
the "Transaction Agreements"), and any other agreements which may subsequently
be entered into between the Company and the Lender, are hereby expressly limited
so that in no event whatsoever, whether by reason of deferment or advancement of
loan proceeds, acceleration of maturity of the loan evidenced hereby, or
otherwise, shall the amount paid or agreed to be paid to Lender hereunder for
the loan, use, forbearance or detention of money exceed that permissible under
applicable law. If at any time the performance of any provision hereof or of any
other such agreement involves a payment exceeding the limit of the price that
may be validly charged for the loan, use, forbearance or detention of money
under applicable law, then automatically and retroactively, ipso facto, the
obligation to be performed shall be reduced to such limit, it being the specific
intent of the Company and Lender hereof that all payments under this Agreement
or the Note are to be credited first to interest as permitted by law, but not in
excess of (i) the agreed rate of interest set forth herein, or (ii) that
permitted by law, whichever is the lesser, and the balance toward the reduction
of principal. The provisions of this paragraph shall never be superseded or
waived and shall control every other provision of the Transaction Agreements and
all other agreements between the Company and Lender.
2. Representations and Warranties of the Lender
Lender hereby represents and warrants to the Company, the Parent
and Omnis Foreign Subsidiaries with respect to the issuance of the Note as
follows:
2.1 Experience. It is experienced in evaluating and loaning
funds in high technology companies such as the Company and Parent.
-3-
<PAGE> 7
2.2 Tax Consequences. It understands and acknowledges that any
financing structured in the manner provided for herein involves certain tax
risks, and therefore it has consulted its own tax advisors regarding all the
federal and state tax consequences of the transactions contemplated by this
Agreement.
2.3 Authority. It has all corporate rights, power and authority
to enter into this Agreement and the Note and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of the Transaction
Agreements by the Lender and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on its behalf. The Transaction Agreements to which Lender is a
signatory have been duly executed and delivered by the Lender, and, to the
extent they impose any obligations on the Lender, constitute legal, valid and
binding obligations of the Lender, enforceable in accordance with their
respective terms, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies.
2.4 Access to Data. It has had an opportunity to discuss each of
the Company's, the Parent's and Omnis Foreign Subsidiaries' (collectively
"Omnis") business, management, and financial affairs with its management and the
opportunity to review Omnis' facilities. It understands that such discussions,
as well as any written information issued by Omnis, were intended to describe
the aspects of Omnis' business and prospects which it believes to be material
but were not necessarily a thorough or exhaustive description.
2.5 Reverse Stock Split. It understands that the Parent
consummated a 1:10 reverse stock split of all of the outstanding Common Stock of
the Parent, and such reverse stock split was effective October 10, 1997 (the
"Reverse Stock Split").
-4-
<PAGE> 8
3. Representations and Warranties of the Company, Parent and Omnis
Foreign Subsidiaries.
For purposes of this Section 3, unless the context otherwise
requires, the term "Parent" shall include the Parent and its direct and indirect
subsidiaries, including the Company, as listed on its most recent Annual Report
on Form 10-K for the year ended March 31, 1997, filed with the Securities and
Exchange Commission (the "SEC"). Except as set forth in the Schedule of
Exceptions attached hereto as Exhibit C, the Company, the Parent and Omnis
Foreign Subsidiaries each represents and warrants to the Lender, as of the
Closing Date, as follows:
3.1 Corporate Organization and Authority of the Company. The
Parent and each of its subsidiaries, including the Company and Omnis Foreign
Subsidiaries:
(i) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(ii) has the corporate power and authority to own and
operate its properties and to carry on its business as presently conducted and
as proposed to be conducted; and
(iii) is qualified to do business as a foreign
corporation in each jurisdiction in which the ownership of its property or the
nature of its business requires such qualification, except where failure to so
qualify would not have a material adverse effect on the business, properties or
financial condition of the Company and its subsidiaries, taken as a whole. The
Company has made available to the Lender true and correct copies of its
Certificate of Incorporation and By-laws as amended.
3.2 Corporate Power. The Company, the Parent and Omnis Foreign
Subsidiaries will have at the Closing Date all requisite legal and corporate
power and authority to execute and deliver the
-5-
<PAGE> 9
Transaction Agreements, to sell and issue the Note hereunder and to carry out
and perform its obligations under the terms of the Transaction Agreements.
3.3 Capitalization.
(a) The authorized capital stock of the Parent consists
of:
(i) Common Stock. 4,000,000 shares of Common
Stock, $0.10 par value, of which approximately 2,121,700 shares were issued and
outstanding as of October 8, 1997, taking into account the Reverse Stock Split.
(ii) Preferred Stock. 300,000 shares of
Preferred Stock of which no shares are issued and outstanding, taking into
account the Reverse Stock Split.
(iii) All outstanding shares of the Parent's
Common Stock have been duly authorized and validly issued (including, without
limitation, issued in compliance with applicable federal and state securities
laws), and are fully-paid and nonassessable.
(iv) As of September 29, 1997, the Parent had
reserved 201,876 shares of Common Stock (taking into account the Reverse Stock
Split) for future issuance to employees, officers, directors, and consultants of
the Parent pursuant to employee stock benefit plans or agreements approved by
the Board of Directors. There are no other options, warrants, conversion
privileges or other contractual rights presently outstanding to purchase or
otherwise acquire any shares of the Parent's capital stock or other securities
(whether or not authorized).
(b) The authorized capital stock of the Company consists
of 4,900,000 shares of Common Stock, no par value, of which 100,010 shares are
issued and outstanding, and 100,000 shares of Preferred Stock, no par value,
none of which are outstanding.
-6-
<PAGE> 10
(c) Parent owns all outstanding capital stock of the
Company and Omnis Holdings UK.
3.4 Authorization. All corporate action on the part of the
Company, the Parent, Omnis Foreign Subsidiaries and their respective officers,
directors and stockholders necessary for the authorization, execution, delivery
and performance by the Company and Omnis Foreign Subsidiaries of all its
obligations under this Agreement, the Guarantees, the Note and any other
Transaction Agreement has been taken; and this Agreement, the Guarantees and the
Note, once executed by the Company, Omnis Foreign Subsidiaries and the Lender,
will constitute legally binding valid obligations of the Company and Omnis
Foreign Subsidiaries enforceable in accordance with their respective terms, such
enforceability being subject only to laws of general application relating to
bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies. The
issuance of the Note will not give rise to any preemptive rights or rights of
first refusal on behalf of any person in existence on the date hereof.
3.5 No Conflict. The execution and delivery of the Transaction
Agreements do not, and the consummation of the transactions contemplated hereby
and thereby and the performance of the obligations hereunder and thereunder will
not, conflict with, or result in any violation of, or default (with or without
notice or lapse in time, or both), or give rise to a right of termination,
cancellation or acceleration of any obligation or to a loss of a material
benefit, under, any provision of the Certificate of Incorporation or By-laws of
the Parent or the Articles of Incorporation or By-Laws of the Company or any
corporate charter document of either of the Omnis Foreign Subsidiaries. The
execution and delivery of the Transaction Agreements do not, and the
consummation of the transactions contemplated hereby and thereby and the
performance of the obligations hereunder and thereunder will not, conflict
-7-
<PAGE> 11
with, or result in any violation of, or default (with or without notice or lapse
in time, or both), or give rise to a right of termination, cancellation or
acceleration of any obligation or to a loss of a material benefit, under, any
provision of any mortgage, indenture, lease or other agreement or instrument,
permit, concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to the Company, the Parent, either of
the Omnis Foreign Subsidiaries or their respective properties or assets, the
effect of which could have a material adverse effect on the Parent and its
subsidiaries taken as a whole, or materially impair or restrict its power to
perform the obligations of the Company and either of the Omnis Foreign
Subsidiaries as contemplated hereby.
3.6 Accuracy of Reports. The Parent's Annual Report on Form 10-K
for the year ended March 31, 1997 filed with the SEC, and all reports required
to be filed by the Company thereafter up to the date of this Agreement under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), copies of
which have been made available to the Lender, have been duly filed, were in
substantial compliance with the requirements of their respective report forms,
were complete and correct in all material respects as of the dates at which the
information was furnished, and contained (as of such dates) no untrue statement
of a material fact nor omitted to state a material fact necessary in order to
make the statements made therein in light of the circumstances in which made not
misleading. Since the date of the latest of such reports, there has not been any
material adverse change in the condition (financial or otherwise) or results of
operations of the Parent and its subsidiaries taken as a whole.
3.7 Changes. Except as otherwise disclosed herein, in the
Schedule of Exceptions attached hereto as Exhibit C, in reports filed with the
SEC by the Parent under the Exchange Act, and other than continuing financial
losses of the Parent, the Company and Omnis Foreign Subsidiaries since March 31,
1997, there has not been:
-8-
<PAGE> 12
(i) any material change in the assets, liabilities,
financial condition, prospects or operations of the Company or Parent from that
reflected in the reports described in Section 3.6 above, except changes in the
ordinary course of business which have not been, either in any individual case
or in the aggregate, materially adverse to the Parent and its subsidiaries,
taken as a whole;
(ii) any change, except in the ordinary course of
business, in the contingent obligations of the Parent, the Company, or either of
the Omnis Foreign Subsidiaries, whether by way of guaranty, endorsement,
indemnity, warranty or otherwise;
(iii) any damage, destruction or loss, whether or not
covered by insurance, materially and adversely affecting the properties or
business of the Parent, the Company or either of the Omnis Foreign Subsidiaries;
(iv) any declaration or payment of any dividend or other
distribution of the assets of the Parent, the Company or either of the Omnis
Foreign Subsidiaries;
(v) any labor organization activity affecting the
Company, the Parent or either of the Omnis Foreign Subsidiaries; or
(vi) to the best of the Parent's, Company's or Omnis
Foreign Subsidiaries' knowledge, any other event or condition of any character
which has materially adversely affected the assets, liabilities, financial
condition, prospects or operations of the Parent and its subsidiaries, taken as
a whole.
3.8 Governmental Consent, etc. No consent, approval or
authorization of or designation, declaration or filing with any governmental
authority on the part of the Parent, the Company or Omnis Foreign Subsidiaries
is required in connection with the valid execution and delivery
-9-
<PAGE> 13
of the Transaction Agreements, or the offer, sale or issuance of the Note, or
the consummation of any other transaction contemplated hereby.
3.9 Full Disclosure. The representations and warranties of the
Parent, the Company and Omnis Foreign Subsidiaries contained in this Agreement,
the Schedule of Exceptions and the other exhibits, or any other Transaction
Agreement (including, without limitation, the Guarantees and the Security
Documents) when read together, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements contained herein or therein in light of the circumstances under which
they were made not misleading.
3.10 Direct and Indirect Benefits. The Company and each of the
Omnis Foreign Subsidiaries expects to receive and will receive both direct and
indirect benefits from the $500,000 Credit being extended to the Company by the
Lender pursuant to this Agreement and the Note, and such benefits are real and
material to the Company and each of the Omnis Foreign Subsidiaries.
4. Conditions of Lender's Obligations at Closing. The obligations of the
Lender under Section 1 of this Agreement are subject to the fulfillment at or
before the Closing of each of the following conditions, any of which may be
waived in writing by the Lender:
4.1 Representations and Warranties. The representations and
warranties of the Parent, the Company and Omnis Foreign Subsidiaries in this
Agreement (and, as to the Omnis Foreign Subsidiaries, in the Guarantees and the
Security Documents) shall be true on and as of such Closing with the same effect
as if made on and as of such Closing.
4.2 Performance. The Company, the Parent and Omnis Foreign
Subsidiaries shall have performed or fulfilled all agreements, obligations and
conditions contained herein and in the
-10-
<PAGE> 14
Guarantees and Security Documents required to be performed or fulfilled by the
Parent, Company and either of the Omnis Foreign Subsidiaries, as the case may
be, before such Closing.
4.3 Proceedings Satisfactory; Compliance Certificate. All
corporate and legal proceedings taken by the Parent, the Company and Omnis
Foreign Subsidiaries in connection with the transactions contemplated by this
Agreement and all documents and papers relating to such transactions shall be
satisfactory to the Lender, in the reasonable exercise of the judgment of the
Lender.
4.4 Other Agreements. The Omnis Foreign Subsidiaries shall have
executed and delivered the Guarantees, the Security Agreements and a "comfort"
letter from their U.K. counsel, the Cobbetts firm, in form and substance
satisfactory to Lender.
4.5 No Actions Pending. There shall not then be in effect any
order enjoining or restraining the transactions contemplated by the Transaction
Agreements.
5. Miscellaneous
5.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.
5.2 Successors and Assigns. Except as otherwise 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.
5.3 Entire Agreement. The Transaction Agreements and the other
documents delivered hereto and thereto constitute the full and entire
understanding and agreement between the parties with regard to the subjects
hereof and thereof. None of the Transaction Agreements nor any term hereof and
thereof may be amended, waived, discharged or terminated other than by a written
instrument
-11-
<PAGE> 15
signed by the party against whom enforcement of any such amendment, waiver,
discharge or termination is sought.
5.4 Notices, etc. Any notice and other communications as required
or permitted under the Transaction Agreements shall be mailed, by registered or
certified mail, postage prepaid with return receipt requested, or otherwise
delivered by hand, by messenger or by facsimile (with confirmation of receipt),
addressed (a) if to Lender, at such Lender's address or fax number set forth on
the signature page hereof, or (b) at such other address or fax number as Lender
shall have furnished to the Company in writing, or, in the event someone other
than the Lender becomes the holder of the Note, then to and at the address or
fax number such holder of the Note has furnished to the Company in writing, or
(c) if to the Company or the Parent, at their addresses or fax numbers set forth
on the signature page hereof, or at such other address or fax number as the
Company shall have furnished in writing to the Lender or any subsequent holder
of the Note.
5.5 Counterparts. This Agreement may be executed in two or more
counterparts, each of which may be executed by less than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
5.6 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to any
party.
5.7 Headings. Headings and the table of contents in this
Agreement are for reference purposes only and shall not be deemed to have any
substantive effect.
-12-
<PAGE> 16
5.8 Survival of Representations and Warranties. The
representations and warranties of the parties contained in or made pursuant to
this Agreement shall survive the execution and delivery of this Agreement and
the Closing; provided however, that such representations and warranties need
only be accurate as of the date of such execution and delivery and as of the
Closing.
5.9 Amendment of Agreement. Any provision of this Agreement may
be modified or amended by a written instrument signed by the Company and by the
Lender.
5.10 Finder's Fees. Each of the Company and the Lender represents
and warrants to the other that no person is entitled, directly or indirectly, to
compensation by reason of any contract or understanding with such party, as a
finder or broker in connection with the sale and purchase of the Note hereunder.
Each of the Company, the Parent and Omnis Foreign Subsidiaries, on the one hand,
and the Lender, on the other hand, will indemnify the other against all
liabilities incurred by the indemnifying party with respect to claims related to
investment banking or finders fees in connection with the transactions
contemplated by this Agreement, arising out of arrangements between the party
asserting such claims and the indemnifying party, and all costs and expenses
(including reasonable fees of counsel) of investigating and defending such
claims.
5.11 Expenses. The Company, the Parent, the Omnis Foreign
Subsidiaries and Lender will each bear their own legal and other fees and
expenses in connection with the transactions contemplated by this Agreement.
-13-
<PAGE> 17
The foregoing agreement is hereby executed as of the date first above
written.
OMNIS TECHNOLOGY CORPORATION ASTORIA CAPITAL PARTNERS, L.P.
A DELAWARE CORPORATION BY: ASTORIA CAPITAL MANAGEMENT, INC.
By:_____________________________ By:________________________________
Rick Koe, President
Name: __________________________ Address: 6600 Southwest 92nd Avenue
Suite 370
Title: _________________________ Portland, OR 97223
Fax No.: (503) 244-3801
Address: 851 Traeger Avenue
San Bruno, CA 94066
Fax No.: (650) 571-7174
OMNIS HOLDINGS LIMITED
A CORPORATION ORGANIZED UNDER THE
OMNIS SOFTWARE, INC. LAWS OF ENGLAND
A CALIFORNIA CORPORATION
By:________________________________
By: ___________________________ Name: _____________________________
Name: _________________________ Title:_____________________________
Title: ________________________ Address: Mitford House,
Benhall Saxmundham,
Address: 851 Traeger Avenue Suffolk IP17 1JS, England
San Bruno, CA 94066 Fax No.: (650) 571-7174
Fax No.: (650) 571-7174
OMNIS SOFTWARE LIMITED
A CORPORATION ORGANIZED UNDER THE
LAWS OF ENGLAND
By: _______________________________
Name:______________________________
Title:_____________________________
Address: Mitford House,
Benhall Saxmundham,
Suffolk IP17 1JS, England
Fax No.: (650) 571-7174
-14-
<PAGE> 18
EXHIBIT A
FORM OF PROMISSORY NOTE
<PAGE> 19
EXHIBIT B
GUARANTEES
<PAGE> 20
EXHIBIT C
SCHEDULE OF EXCEPTIONS TO REPRESENTATIONS AND WARRANTIES
This Schedule of Exceptions is made and given pursuant to Section 3 of
the Note Purchase Agreement dated as of October 31, 1997, (the "Agreement") by
and among Omnis Technology Corporation, a Delaware corporation (the "Parent"),
Omnis Software, Inc. (the "Company"), Omnis Foreign Subsidiaries, as defind in
the Agreement, and the Lender, as defined in the Agreement. Unless the context
otherwise requires, all capitalized terms shall have the meanings as defined in
the Agreement. The section numbers below correspond to the section numbers of
the representations and warranties in the Agreement which are modified by the
disclosures; however, any information disclosed herein under any section number
shall be deemed to be disclosed and incorporated into any other section number
under the Agreement where such disclosure would be appropriate.
Section 3.6 For the quarter ended September 30, 1997, the Parent expects
to report a significant financial loss, which shall not be greater than the loss
reported for the quarter ended June 30, 1997.
<PAGE> 1
Exhibit10.3
================================================================================
OMNIS TECHNOLOGY CORPORATION
SERIES A CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
First Closing: April 1, 1998
Second Closing: May 22, 1998
================================================================================
<PAGE> 2
3 TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
1. Purchase and Sale of Preferred Stock.....................................................1
1.1 Sale and Issuance of Preferred Stock..............................................1
1.2 Closing...........................................................................1
2. Representations and Warranties of Purchaser..............................................1
2.1 Experience........................................................................2
2.2 Tax Consequences..................................................................2
2.3 Authority.........................................................................2
2.4 Access to Data....................................................................2
2.5 Financial Condition of the Company................................................2
2.6 Reverse Stock Split...............................................................2
3. Representations and Warranties of the Company............................................2
3.1 Corporate Organization and Authority of the Company...............................2
3.2 Corporate Power...................................................................3
3.3 Capitalization....................................................................3
3.4 Authorization.....................................................................3
3.5 No Conflict.......................................................................4
3.6 Accuracy of Reports...............................................................4
3.7 Changes...........................................................................4
3.8 Governmental Consent, etc.........................................................5
3.9 Full Disclosure...................................................................5
4. Conditions of Purchaser's Obligations at Closing.........................................7
4.1 Representations and Warranties....................................................7
4.2 Performance.......................................................................7
4.3 Proceedings Satisfactory; Compliance Certificate..................................7
4.4 No Actions Pending................................................................7
4.5 Opinion of Company's Counsel......................................................7
4.6 Certificate of Designation........................................................7
4.7 Compliance Certificate............................................................7
5. Additional Agreements....................................................................7
5.1 Undertaking With Respect to Authorized Common.....................................7
5.2 Shareholder Rights Agreement......................................................8
</TABLE>
-i-
<PAGE> 3
TABLE OF CONTENTS
(CONTINUED)
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
5.3 Board of Directors................................................................8
5.4 Docket Search.....................................................................8
6. Miscellaneous............................................................................8
6.1 Governing Law.....................................................................8
6.2 Successors and Assigns............................................................8
6.3 Entire Agreement..................................................................8
6.4 Notices, etc......................................................................8
6.5 Counterparts......................................................................9
6.6 Severability......................................................................9
6.7 Headings..........................................................................9
6.8 Survival of Representations and Warranties........................................9
6.9 Amendment of Agreement............................................................9
6.10 Finder's Fees.....................................................................9
6.11 Expenses..........................................................................9
</TABLE>
SCHEDULES
Schedule A - Purchase and Sale of Series A Preferred Pursuant to the Agreement
EXHIBITS
Exhibit A - Material Agreements
Exhibit B - Form of Opinion of Company Counsel
Exhibit C - Form of Shareholder Rights Agreement
WBK::ODMA\PCDOCS\SQL2\513749\7
-ii-
<PAGE> 4
OMNIS TECHNOLOGY CORPORATION
SERIES A CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
This Series A Convertible Preferred Stock Purchase Agreement (the
"Agreement") is entered into as of May 22, 1998, by and among Omnis Technology
Corporation (f/k/a Blyth Holdings Inc.) (the "Company") and Astoria Capital
Partners, L.P., a California limited partnership ("Purchaser").
RECITALS:
A. The Company desires to sell shares of Series A Convertible Preferred
Stock to Purchaser, and Purchaser desires to purchase shares of Series A
Convertible Preferred Stock, on the terms and subject to the conditions set
forth in this Agreement.
In consideration of the mutual covenants and conditions herein
contained, the parties hereto agree as follows:
1. Purchase and Sale of Preferred Stock.
1.1 Sale and Issuance of Preferred Stock. The Company shall sell
to Purchaser and Purchaser shall purchase from the Company, at a price equal to
$8.028 (the "Purchase Price"), an aggregate of up to 124,564 shares of Series A
Convertible Preferred Stock (the "Shares") for an aggregate purchase price of up
to $1,000,000.00 in one or more Closings. Shares sold by the Company to
Purchaser pursuant to this Agreement are described on Schedule A to this
Agreement. On the date hereof, 12,456 Shares shall be issued sold by the Company
to Purchaser for an aggregate of $99,996.77 (the "Aggregate Purchase Price").
1.2 Closing. The purchase and sale of Shares shall take place on
the date hereof at the offices of Wilson Sonsini Goodrich & Rosati, 650 Page
Mill Road. Palo Alto, California 94304. The purchase and sale of the balance of
the Shares not purchased on the date hereof shall take place in Purchaser's sole
discretion on such date or dates and at such time as the Company and Purchaser
mutually agree (each a "Closing," the date of which is a "Closing Date"),
provided that any Closing pursuant to this Agreement shall take place on or
before October 1, 1998. At a Closing the Company shall deliver to Purchaser a
certificate representing the Shares against delivery to the Company by Purchaser
at a Closing of (a) an originally executed counterpart of this Agreement and (b)
the Aggregate Purchase Price of the Shares by wire transfer or by a check
payable to the Company.
2. Representations and Warranties of Purchaser
Purchaser hereby represents and warrants to the Company with
respect to the purchase of the Shares as follows:
<PAGE> 5
2.1 Experience. It is experienced in evaluating and loaning funds
in high technology companies such as the Company.
2.2 Tax Consequences. It understands and acknowledges that any
financing structured in the manner provided for herein involves certain tax
risks, and the Company has made no representations to Purchaser as to the
federal and state tax consequences of the transactions contemplated by this
Agreement.
2.3 Authority. It has all corporate rights, power and authority
to enter into this Agreement and the Shareholder Rights Agreement dated the date
hereof by and between the Company and Purchaser (the "Rights Agreement") and to
consummate the transactions contemplated hereby and thereby.
2.4 Access to Data. It has had an opportunity to discuss each of
the Company's and the Company's subsidiaries' (collectively "Omnis") business,
management, and financial affairs with the Company's management and the
opportunity to review Omnis' facilities. It understands that such discussions,
as well as any written information issued by Omnis, were intended to describe
the aspects of Omnis' business and prospects which it believes to be material
but were not necessarily a thorough or exhaustive description.
2.5 Financial Condition of the Company. Purchaser understands
that the Company is entering into negotiations with its US-based unsecured
creditors in attempts to negotiate a favorable settlement of outstanding
payables. Purchaser understands that there is no guarantee that this group will
reach any settlement of these debts, which will negatively impact the Company's
ability to reach its cash flow targets and may force the Company to cease
operations.
2.6 Reverse Stock Split. It understands that the Company
consummated a 1:10 reverse stock split of all of the outstanding Common Stock of
the Company, and such reverse stock split was effective October 10, 1997 (the
"Reverse Stock Split").
3. Representations and Warranties of the Company.
The Company represents and warrants to Purchaser, as of a Closing
Date, as follows:
3.1 Corporate Organization and Authority of the Company. The
Company and each of its subsidiaries:
(a) is a corporation duly organized, validly existing,
authorized to exercise all its corporate powers, rights and privileges and in
good standing in the state or jurisdiction of its incorporation;
(b) has the corporate power and authority to own and operate
its properties and to carry on its business as presently conducted and as
proposed to be conducted; and
-2-
<PAGE> 6
(c) is qualified to do business as a foreign corporation in
each jurisdiction in which the ownership of its property or the nature of its
business requires such qualification, except where failure to so qualify would
not have a material adverse effect on the business, properties or financial
condition of the Company and its subsidiaries, taken as a whole. The Company has
made available to Purchaser true and correct copies of its Certificate of
Incorporation and Bylaws as amended.
3.2 Corporate Power. The Company will have at a Closing Date all
requisite legal and corporate power and authority to execute and deliver the
Agreement and the Rights Agreement, to sell and issue the Shares hereunder and
to carry out and perform its obligations under the terms of the Agreement and
the Rights Agreement.
3.3 Capitalization.
(a) The authorized capital stock of the Company consists of:
(i) Common Stock. 4,000,000 shares of Common Stock,
$0.10 par value, of which approximately 2,125,827 shares were issued and
outstanding as of April 1, 1998, taking into account the Reverse Stock Split.
(ii) Preferred Stock. 300,000 shares of Preferred
Stock of which no shares are issued and outstanding, taking into account the
Reverse Stock Split.
(iii) All outstanding shares of the Company's Common
Stock have been duly authorized and validly issued (including, without
limitation, issued in compliance with applicable federal and state securities
laws), and are fully-paid and nonassessable.
(iv) As of April 1, 1998, the Company had reserved
178,310 shares of Common Stock (taking into account the Reverse Stock Split) for
future issuance to employees, officers, directors, and consultants of the
Company pursuant to employee stock benefit plans or agreements approved by the
Board of Directors, in addition to outstanding warrants for 73,562 shares of
Common Stock. There are no other options, warrants, conversion privileges or
other contractual rights presently outstanding to purchase or otherwise acquire
any shares of the Company's capital stock or other securities (whether or not
authorized).
(b) The Company owns all outstanding capital stock of Omnis
Software, Inc., a California corporation (the "Company"), Omnis Holdings
Limited, a corporation organized under the laws of England, Omnis Software
Limited, a corporation organized under the laws of England, Omnis Holdings UK, a
corporation organized under the laws of England and Omnis Software GmbH, a
corporation organized under the laws of Germany.
3.4 Authorization. All corporate action on the part of the
Company and its officers, directors and stockholders necessary for the
authorization, execution, delivery and performance by the Company of all its
obligations under this Agreement and the Rights Agreement have been taken; and
this Agreement and the Rights Agreement, once executed by the Company and
Purchaser, will constitute
-3-
<PAGE> 7
legally binding valid obligations of the Company enforceable in accordance with
their terms, such enforceability being subject only to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies. The issuance of the Shares will not give rise to any
preemptive rights or rights of first refusal on behalf of any person in
existence on the date hereof.
3.5 No Conflict. The execution and delivery of the Agreement and
the Rights Agreement do not, and the consummation of the transactions
contemplated hereby and thereby and the performance of the obligations hereunder
will not, conflict with, or result in any violation of, or default (with or
without notice or lapse in time, or both), or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit, under, any provision of the Certificate of Incorporation or
Bylaws of the Company. The execution and delivery of the Agreement and the
Rights Agreement do not, and the consummation of the transactions contemplated
hereby and thereby and the performance of the obligations hereunder and
thereunder will not conflict with or result in any violation of, or default
(with or without notice or lapse in time, or both), or give rise to a right of
termination, cancellation or acceleration of any obligation or to a loss of a
material benefit, under, any provision of any mortgage, indenture, lease or
other agreement or instrument, permit, concession, franchise, license, judgment,
order, decree, statute, law, ordinance, rule or regulation applicable to the
Company or its properties or assets, the effect of which could have a material
adverse effect on the Company, or materially impair or restrict its power to
perform the obligations of the Company as contemplated hereby and thereby.
3.6 Accuracy of Reports. The Company's Annual Report on Form 10-K
for the year ended March 31, 1997 and on the Quarterly Reports on Form 10-Q for
the quarters ended June 30, 1997, September 30, 1997 and December 31, 1997 filed
with the SEC, and all reports required to be filed by the Company thereafter up
to the date of this Agreement under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), copies of which have been made available to
Purchaser, have been duly filed, were in substantial compliance with the
requirements of their respective report forms, were complete and correct in all
material respects as of the dates at which the information was furnished, and
contained (as of such dates) no untrue statement of a material fact nor omitted
to state a material fact necessary in order to make the statements made therein
in light of the circumstances in which made not misleading. Since the date of
the latest of such reports, there has not been any material adverse change in
the condition (financial or otherwise) or results of operations of the Company.
3.7 Changes. Except as otherwise disclosed herein, in reports
filed with the SEC by the Company under the Exchange Act and other than
continuing financial losses of the Company, since December 31, 1997, there has
not been:
(i) any material change in the assets, liabilities,
financial condition, prospects or operations of the Company from that reflected
in the reports described in Section 3.6 above, except changes in the ordinary
course of business which have not been, either in any individual case or in the
aggregate, materially adverse to the Company;
-4-
<PAGE> 8
(ii) any change, except in the ordinary course of business,
in the contingent obligations of the Company, whether by way of guaranty,
endorsement, indemnity, warranty or otherwise;
(iii) any damage, destruction or loss, whether or not
covered by insurance, materially and adversely affecting the properties or
business of the Company;
(iv) any declaration or payment of any dividend or other
distribution of the assets of the Company;
(v) any labor organization activity affecting the Company;
or
(vi) to the best of the Company's knowledge, any other event
or condition of any character which has materially adversely affected the
assets, liabilities, financial condition, prospects or operations of the
Company.
3.8 Governmental Consent, etc. No consent, approval or
authorization of or designation, declaration or filing with any governmental
authority on the part of the Company is required in connection with the valid
execution and delivery of this Agreement, or the offer, sale or issuance of the
Shares, or the consummation of any other transaction contemplated hereby. The
Company has complied with and is effective under all state securities or Blue
Sky laws applicable to the offer and sale of the Shares to Purchaser.
3.9 Full Disclosure. The representations and warranties of the
Company contained in this Agreement and the certificates prepared or supplied to
Purchaser by the Company do not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements
contained herein or therein in light of the circumstances under which they were
made not misleading.
3.10 Validity of the Shares. The Shares have been duly authorized
and, when issued, sold and delivered in accordance with the terms of and for the
consideration expressed in this Agreement are duly authorized and shall be duly
authorized and shall be duly and validly issued (including, without limitation,
issued in compliance with applicable state and federal securities laws),
fully-paid and non-assessable and shall be free and clear of all preemptive
rights, rights of first refusal, liens, charges, restrictions, claims and
encumbrances imposed by or through the Company, except as specifically set forth
in the Certificate of Incorporation, the Certificate of Designation, or this
Agreement. The shares of Common Stock issuable upon the conversion of the
Preferred Shares have been duly and validly reserved for issuance and, when so
issued in accordance with the Certificate of Incorporation and the Certificate
of Designation, shall be duly authorized, validly issued (including, without
limitation, issued in compliance with applicable state and federal securities
laws), fully paid and nonassessable and shall be free and clear of all
preemptive rights, rights of first refusal, liens, changes, restrictions on
transfer, claims and encumbrances imposed by or through the Company, except as
specifically set forth in the Certificate of Incorporation, the Certificate of
Designation or this Agreement.
-5-
<PAGE> 9
3.11 Litigation. Except as otherwise disclosed to Purchaser,
there is no action, proceeding or investigation pending or, to the knowledge of
the Company, threatened, or any basis therefor known to the Company that
questions the validity of this Agreement or the right of the Company to enter
into such agreement, or to consummate the transactions contemplated hereby, or
which might result, either individually or in the aggregate, in any material
adverse change in the assets, condition, affairs or prospects of the Company,
financially or otherwise, or any change in the current equity ownership of the
Company. The foregoing includes, without limitation, actions pending or
threatened (or any basis therefor known to the Company) involving the prior
employment of any of the Company's employees, their use in connection with the
Company's business of any trade secrets of any of their former employers, or
their obligations under any agreements with prior employers. The Company (a) is
not a party to any lawsuit or similar action or proceeding, (b) is not a party
to or subject to any order, writ, injunction, judgment or decree of any court or
government agency or instrumentality, and (c) does not intend to initiate any
such action, suit, proceeding or investigation.
3.12 Employee Agreements. All employees and consultants of the
Company are parties to a written agreement, the form of which has been provided
to counsel for the investors, pertaining to (a) the disclosure and transfer to
the Company of certain inventions, developments and discoveries made or
conceived by him or her during the period of his or her employment with or
performance of services for the Company, and (b) maintaining the confidentiality
of proprietary information of the Company. No current employee or consultant of
the Company has excluded works or inventions made prior to his or her employment
with the Company from his or her assignment of inventions pursuant to such
employee or consultant's Proprietary Information and Inventions Agreement.
3.13 Agreements; Actions; Obligations to Related Parties.
(i) All of the contracts and agreements with expected
receipts or expenditures in excess of $50,000 to which the Company is a party as
of the Closing are listed on Exhibit A hereto. All such contracts and agreements
are legally binding, valid and in full force and effect in all material
respects, except to the extent that enforcement of such contracts and agreements
may be subject to applicable federal or state bankruptcy, insolvency,
reorganization, arrangement, moratorium, fraudulent conveyance or other laws or
court decisions relating to or affecting the rights of creditors generally, and
such enforcement may be limited by equitable principles of general
applicability.
(ii) There are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, affiliates
or any affiliate thereof other than: (i) as contemplated under or referenced in
this Agreement, (ii) for payment as salary for services rendered, (iii) except
for the Warrant Plan, for other standard employee benefits made generally
available to all employees, (iv) reimbursement for reasonable travel and other
business expenses incurred on behalf of the Company in the ordinary course of
business, or (v) general obligations that a corporation has to its shareholders
under applicable laws, the Certificate of Incorporation or the Bylaws of the
Company.
(iii) Except for the agreements explicitly contemplated
hereby or referenced herein, and the Company's Certificate of Incorporation and
Bylaws, the Company is not a party to, and
-6-
<PAGE> 10
is not bound by any contract, agreement or instrument that materially affects
its business as now conducted or as proposed to be conducted, its properties or
its financial condition.
4. Conditions of Purchaser's Obligations at Closing. The obligations of
Purchaser under Section 1 of this Agreement are subject to the fulfillment at or
before a Closing of each of the following conditions, any of which may be waived
in writing by Purchaser:
4.1 Representations and Warranties. The representations and
warranties of the Company in this Agreement shall be true on and as of such
Closing with the same effect as if made on and as of such Closing.
4.2 Performance. The Company shall have performed or fulfilled
all agreements, obligations and conditions contained herein required to be
performed or fulfilled by the Company before such Closing.
4.3 Proceedings Satisfactory; Compliance Certificate. All
corporate and legal proceedings taken by the Company in connection with the
transactions contemplated by this Agreement and the Rights Agreement and all
documents and papers relating to such transactions shall be satisfactory to
Purchaser, in the reasonable exercise of the judgment of Purchaser.
4.4 No Actions Pending. There shall not then be in effect any
order enjoining or restraining the transactions contemplated by this Agreement.
4.5 Opinion of Company's Counsel. Purchaser shall have received
from Wilson Sonsini Goodrich & Rosati, P.C., counsel to the Company, an opinion
addressed to them and dated the Closing Date, in the form attached as Exhibit B
hereto.
4.6 Certificate of Designation. All necessary corporate action
shall have been taken for the Certificate of Designation of Series A Preferred
Stock of the Company to be effective and filed with the Delaware Secretary of
State.
4.7 Compliance Certificate. The Company shall have delivered to
Purchaser a Compliance Certificate executed by an officer of the Company, dated
as of the Closing Date, to the effect that the conditions set forth in Sections
4.1, 4.2, 4.3, 4.4 and 4.6 of this Agreement have been satisfied.
5. Additional Agreements
5.1 Undertaking With Respect to Authorized Common. Prior the next
annual meeting of the Company's shareholders, the Company will not issue any
shares of its Common Stock, or any securities convertible, exercisable or
otherwise exchangeable for shares of its Common Stock, if such issuance could
result in a shortfall of the number of authorized shares of the Company's Common
Stock available for issuance upon conversion of the Shares; provided, however,
that the Company may issue securities convertible, exercisable or otherwise
exchangeable for shares of its Common Stock if it
-7-
<PAGE> 11
provides in such securities that such securities may not be converted, exercised
or otherwise exchanged if such conversion, exercise or exchange would result in
a shortfall of the number of authorized shares of the Company's Common Stock
available for issuance upon conversion of the Shares or other outstanding
securities of the Company which are convertible, exercisable or otherwise
exchangeable for shares of its Common Stock. From and after the date of such
meeting, the Company will at all times reserve an appropriate number of shares
of its Common Stock for issuance upon conversion of the shares.
5.2 Shareholder Rights Agreement. Purchaser and the Company shall
enter into the Shareholder Rights Agreement substantially in the form attached
hereto as Exhibit C.
5.3 Board of Directors. As soon as practicable after the first
Closing hereunder, the Company shall make its best efforts to reconstitute the
Board of Directors to consist of James Dorst, Gerald Chew, Kenneth Holmes and
Geoffrey Wagner, with three vacancies.
5.4 Docket Search. As soon as practicable after the first Closing
hereunder, the Company, with the assistance of its counsel, shall make
reasonable efforts to search for outstanding litigation, within the following
parameters: the Company shall employ Courtlink and Pacer to search all United
States federal district courts and the state courts in Santa Clara, San Mateo
and San Francisco Counties.
6. Miscellaneous
6.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.
6.2 Successors and Assigns. Except as otherwise 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.
6.3 Entire Agreement. The Agreement and the other documents
delivered hereto and thereto constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and thereof.
Neither the Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the party against whom
enforcement of any such amendment, waiver, discharge or termination is sought.
6.4 Notices, etc. Any notice and other communications as required
or permitted under the Agreement shall be mailed, by registered or certified
mail, postage prepaid with return receipt requested, or otherwise delivered by
hand, by messenger or by facsimile (with confirmation of receipt), addressed (a)
if to Purchaser, at such Purchaser's address or fax number set forth on the
signature page hereof, or (b) at such other address or fax number as Purchaser
shall have furnished to the Company in writing, or, in the event someone other
than Purchaser becomes the holder of the Shares, then to and at the address or
fax number such holder of the Shares has furnished to the Company in writing, or
(c) if
-8-
<PAGE> 12
to the Company, at its address or fax number set forth on the signature page
hereof, or at such other address or fax number as the Company shall have
furnished in writing to Purchaser or any subsequent holder of the Shares.
6.5 Counterparts. This Agreement may be executed in two or more
counterparts, each of which may be executed by less than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
6.6 Severability. In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to any
party.
6.7 Headings. Headings and the table of contents in this
Agreement are for reference purposes only and shall not be deemed to have any
substantive effect.
6.8 Survival of Representations and Warranties. The
representations and warranties of the parties contained in or made pursuant to
this Agreement shall survive the execution and delivery of this Agreement and a
Closing; provided however, that such representations and warranties need only be
accurate as of the date of such execution and delivery and as of a Closing.
6.9 Amendment of Agreement. Any provision of this Agreement may
be modified or amended by a written instrument signed by the Company and by
Purchaser.
6.10 Finder's Fees. Each of the Company and Purchaser represents
and warrants to the other that no person is entitled, directly or indirectly, to
compensation by reason of any contract or understanding with such party, as a
finder or broker in connection with the sale and purchase of the Shares
hereunder. Each of the Company, on the one hand, and Purchaser, on the other
hand, will indemnify the other against all liabilities incurred by the
indemnifying party with respect to claims related to investment banking or
finders fees in connection with the transactions contemplated by this Agreement,
arising out of arrangements between the party asserting such claims and the
indemnifying party, and all costs and expenses (including reasonable fees of
counsel) of investigating and defending such claims.
6.11 Expenses. The Company shall bear all costs with respect to
the transactions contemplated by this Agreement, including reasonable costs of
Purchaser's counsel.
-9-
<PAGE> 13
The foregoing Series A Convertible Preferred Stock Purchase Agreement is
hereby executed as of the date first above written.
OMNIS TECHNOLOGY CORPORATION ASTORIA CAPITAL PARTNERS, L.P.
A DELAWARE CORPORATION BY: ASTORIA CAPITAL MANAGEMENT, INC.
By: By:
------------------------------------ ---------------------------------
Kenneth P. Holmes, Rick Koe, President
Chief Financial Officer and
Interim Chief Executive Officer Address: 6600 Southwest 92nd Avenue
Suite 370
Address: 851 Traeger Avenue Portland, OR 97223
San Bruno, CA 94066 Fax No.: (503) 244-3801
Fax No.: (650) 829-3429
<PAGE> 14
Schedule A
Purchase and Sale of Series A Preferred Stock
<TABLE>
<CAPTION>
Date Number of Shares Purchase Price
- ---- ---------------- --------------
<S> <C> <C>
April 1, 1998 49,826 $400,003.13
_________, 1998 12,456 $99,996.77
</TABLE>
AGREED AND ACCEPTED:
OMNIS TECHNOLOGY CORPORATION
- ---------------------------------------
Ken Holmes, Chief Financial Officer and
Interim Chief Executive Officer
Date:
------------------
ASTORIA CAPITAL PARTNERS, L.P.
- ---------------------------------------
Rick Koe, President
Date:
-------------------
-2-
<PAGE> 1
Exhibit 10.4
[OMNIS SOFTWARE INC. LOGO]
Dear Mr. Doyle:
It is my pleasure to offer you the position of Vice President of Marketing of
OMNIS Software, Inc. (the "Company" or "OSI") reporting to me starting on or
about April 1, 1998. Your semi-monthly salary will be $4,166.66. This is
equivalent to an annual base salary of $100,000. You are also eligible for a
variable compensation plan of up to 150% of your annual salary based on 125%
attainment of quarterly milestones. This compensation plan is outlined in
Attachment A.
You have expressly requested not to receive any Paid Time Off ("PTO") benefits.
You understand and acknowledge that this agreement, with respect to the PTO
benefits, overrides the Company's policy stated in the Employee Handbook.
- ----------
K. Doyle Initials
Upon your acceptance of the terms of this letter and Employee Agreement
(Attachment A) we will recommend to the Board that you be granted non-qualified
stock options of the Company's common stock, as outlined in Attachment A. These
options will be granted at the fair market value of the Company's common stock
as of the first board meeting following the date of your signature below.
This offer is contingent upon you presenting, in accordance with the Immigration
Reform and Control Act of 1986, verification of your identity and your legal
right to work in the United States. In the event that you do not possess, or are
unable to obtain authorization to accept employment in the U.S., our offer of
employment is withdrawn.
As a condition of your employment with OSI you will also be required to sign the
enclosed Employee Agreement (Attachment A).
This letter, together with the enclosed attachments, sets forth the terms of
your employment with the Company and supersede any prior representations or
agreements, whether written or oral. This letter may not be modified or amended
except by a written agreement, signed by the President of the Company and by
you.
Notwithstanding the foregoing, you are aware that employment at OMNIS Software
Inc. is for no specific period and constitutes at will employment. As a result,
you are free to resign at any time, for any reason or for no reason. Similarly,
OSI is free to conclude its employment relationship with you at any time, with
or without cause, and with or without notice.
I look forward to a favorable reply and welcoming you to OMNIS Software Inc.
Sincerely, Accepted By:
------------------------------
Kevin Doyle
Kenneth P. Holmes
President, CEO ------------------------------
Date
Enclosures:
Attachment A
Schedule 1
1
<PAGE> 2
ATTACHMENT A
EMPLOYEE AGREEMENT
This document defines the standard terms of employment for Kevin Doyle
("Employee") in his role as Vice President of Marketing at OMNIS Software, Inc.
(the "Company" or "OSI") including the Performance Requirements and Compensation
Plan for this position.
TERMS
A. COMPENSATION:
The total targeted compensation is made up of your base salary and bonus. The
total targeted annual compensation at 100% of plan is $200,000, excluding any
stock options.
1. Base Salary: Your base salary is $100,000 per year, which will be
paid through the regular semi-monthly company payroll at $4,166.66 per pay
period.
2. Deferred Compensation/Bonus: During the 18 months ending September
30, 1999, following the end of each fiscal quarter (June 30, September 30,
December 31 and March 31 of each year) you will be paid a bonus equal to a
percentage of your quarterly base salary for such preceding quarter as
compensation for satisfying the criteria set forth below, provided that no bonus
will be paid for any quarter in which the Company's cumulative expenses for any
areas under your supervision, including North American sales and Worldwide
marketing ("Managed Marketing Expenses") exceed the limits set forth below. The
bonus for the quarter ending June 30, 1998, if any, will be paid in the amount
of $5,000 as per standard payroll practices with the residual amount of the
bonus, if any, to be paid by December 31, 1998.
Bonus Amounts: The quarterly bonus, if any, will be equal to:
(a) 150% of quarterly base salary if the Company's
cumulative revenues (as recognized on the basis of U.S. generally accepted
accounting principals and in conformity with the Company's revenue recognition
policies) from world-wide sales of products related to the Company's OMNIS
Studio product line ("Studio Revenue") as of the end of such quarter equal or
exceed of 125% of target cumulative Studio Revenue for such quarter as set forth
below.
(b) 100% of quarterly base salary if the Company's
cumulative Studio Revenue as of the end of such quarter equal or exceed 100% and
are less than 125% of target cumulative Studio Revenue for such quarter as set
forth below.
(c) 50% of quarterly base salary if the Company's cumulative
Studio Revenue as of the end of such quarter exceed 90% and are less than 100%
of target cumulative Studio Revenue for such quarter as set forth below.
(d) Zero percent (0%) of quarterly base salary if the
Company's cumulative Studio Revenue as of the end of such quarter equal or are
less than 90% of target cumulative Studio Revenue for such quarter as set forth
below.
CUMULATIVE TARGETED STUDIO REVENUE:
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999*
<S> <C> <C> <C> <C> <C> <C>
90% of targeted revenue $ 33,613 $ 305,987 $ 925,815 $1,869,809 $3,112,154 $6,128,584
100% of targeted revenue $ 37,348 $ 339,986 $1,028,683 $2,077,565 $3,457,949 $6,809,538
</TABLE>
2
<PAGE> 3
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
125% of targeted revenue $ 46,684 $ 424,982 $1,285,854 $2,596,957 $4,322,436 $8,511,923
</TABLE>
*It is agreed that as $750,000 of projected revenue in the quarter ending
September 30, 1999 includes revenue from upgrade fees for Studio 3.0.
Accordingly, if that release of the product is not generally available by August
30, 1999, the revenue target in that quarter will be reduced by $750,000.
CUMULATIVE TARGETED MANAGED MARKETING EXPENSES (NOT TO EXCEED):
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999
<S> <C> <C> <C> <C> <C>
$156,500 $443,500 $878,500 $1,123,500 $1,468,500 $1,813,500
</TABLE>
The following table sets forth for illustration purposes the amount of
Employee's bonus in each quarter if Employee obtains the indicated levels of
targeted Studio Revenue.
BONUS COMPENSATION ILLUSTRATION:
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999
% OF TARGETED STUDIO
REVENUE
<S> <C> <C> <C> <C> <C> <C>
@ 90% or below 0 0 0 0 0 0
Above 90%, below 100% $12,500 $12,500 $12,500 $12,500 $12,500 $12,500
At or Above 100%, below 125% $25,000 $25,000 $25,000 $25,000 $25,000 $25,000
At 125% or above $37,500 $37,500 $37,500 $37,500 $37,500 $37,500
</TABLE>
3. Stock Compensation:
Upon signing this agreement, the President of the Company will recommend to the
Board of Directors of OMNIS Technology Corporation that you be granted
non-qualified options (the "Options") to purchase 300,000 shares of OMNIS
Technology Corporation's common stock. These options will be granted at the fair
market value of the Company's common stock as of the date of the first board
meeting following the date of your signature below and on all enclosed
contracts. These options will vest 100% at the end of 6 years from the date
hereof provided you continuously serve as an employee of the Company during such
period, except as provided below. The terms of this option grant will be set
forth in an option agreement dated the date of such grant, which option
agreement will controls the terms of the option grant.
ACCELERATION OF OPTIONS
Based on the average closing sale price of OMNIS Technology Corporation's common
stock for the ten trading days ending on September 30, 1999, the vesting of some
or all of the Options may accelerate and will vest immediately as per the
Acceleration Schedule below. Options whose vesting is not so accelerated at
September 30, 1999 will continue to vest in accordance with the vesting schedule
described above so long as Employee continues to be an employee of the Company.
In no event will your options continue to vest past September 30, 1999 if you
are no longer an employee of OSI. If Employee's employment with the Company is
terminated for Cause (as defined below) or Employee terminates his employment
with the Company for any reason, Employee will have the standard period of time
to exercise your vested options as per the Company's Stock Option Plan, if any,
and, if such termination occurs prior to September 30, 1999, all vesting of the
Options will terminate and no acceleration of vesting of the Options will occur.
If the Company terminates the Employee's employment for any reason other than
Cause, Employee's Options may vest pursuant to the Acceleration Schedule below
on September 30, 1999.
3
<PAGE> 4
Any Options not accelerated on September 30, 1999 pursuant to the Acceleration
Schedule below will expire as per the standard stock option plan guidelines if
Employee is no longer an employee of OSI.
If OMNIS Technology Corporation merges or is acquired prior to September 30,
1999 and (I) Employee is an employee of the Company on the date of such merger
or acquisition and (II) the result of which is the owners of OMNIS Technology
Corporation's outstanding common stock immediately prior to such transaction own
less than 50% of the shares of the resulting corporation following such
transaction, then Employee's options may accelerate as per the Acceleration
Schedule below based upon the per share price of OMNIS Technology Corporation's
Common Stock price on the date immediately prior to the date of such acquisition
or merger.
If OSI merges or is acquired after September 30, 1999 no Options shall
accelerate under the Acceleration Schedule below.
ACCELERATION SCHEDULE
The acceleration of options, if any, will occur as follows on September 30,
1999.
<TABLE>
<CAPTION>
OMNIS Technology Corporation Number of Shares Fully
per share Stock Price* Vested on September 30, 1999
- ---------------------- ----------------------------
<S> <C>
$18 300,000
$15 225,000
$12 150,000
$ 9 114,000
$ 6 75,000
</TABLE>
*As adjusted for any stock splits, stock dividends, recapitalization or similar
events.
B. Termination
1. AT WILL EMPLOYMENT. EMPLOYEE UNDERSTANDS AND ACKNOWLEDGES THAT
EMPLOYMENT WITH OSI IS FOR AN UNSPECIFIED DURATION AND CONSTITUTES "AT-WILL"
EMPLOYMENT. EMPLOYEE ALSO UNDERSTANDS THAT ANY REPRESENTATION TO THE CONTRARY IS
UNAUTHORIZED AND NOT VALID UNLESS OBTAINED IN WRITING AND SIGNED BY THE
PRESIDENT OF OSI. EMPLOYEE ACKNOWLEDGES THAT THIS EMPLOYMENT RELATIONSHIP MAY BE
TERMINATED AT ANY TIME, WITH OR WITHOUT GOOD CAUSE OR FOR ANY OR NO CAUSE, AT
THE OPTION EITHER OF OSI OR EMPLOYEE, WITH OR WITHOUT NOTICE.
2. TERMINATION FOR CAUSE.
Employee agrees that the Company may at its option terminate his employment
immediately and without prior notice for any of the following reasons ("Cause"):
(i) theft, dishonesty, or falsification of any employment or
Company, its subsidiaries or affiliates' records; or
(ii) improper disclosure of the Company, its subsidiaries or
affiliates' confidential or proprietary information; or
(iii) any intentional act by Employee which causes loss,
damage, or injury to the Company, its subsidiaries or
affiliates' property, reputation, employees, or
business; or
4
<PAGE> 5
(iv) Employee's failure to perform to the minimum standards
of a written plan mutually agreed upon by employee and
the Company, as stated below under Minimum Plan,
provided such failure is not cured within thirty (30)
days following written notice of such failure from the
Company; or
(v) any material breach of this Agreement, which breach is
not cured within thirty (30) days following written
notice of such breach from the Company; or
(vi) failure to comply with Company's policies as stated in
the OMNIS Software Employee Handbook; or
(vii) engaging in any employment, occupation, consulting or
other business activity directly related to the business
in which OSI is now involved or becomes involved during
the term of your employment. All such activity that
exists as of the date of this Agreement may remain in
force, but no additional activity may be entered into.
All such existing activity must be disclosed on Schedule
1 hereto; or
(viii) cumulative Managed Marketing Expenses at the end of any
quarter exceed the limits for such quarter set forth
above without the prior written approval by the CFO of
OSI.
MINIMUM PLAN:
For purposes of this Agreement, the Minimum Plan referred to in paragraph (iv)
above is as follows:
Through March 31, 1999:
(a) $1.3 million in cumulative world-wide Studio Revenue for
the period ending March 31, 1999,; and
Through September 30, 1999:
(a) $4.1 million in total world-wide Studio Revenue for the
period ending September 30, 1999; and
C. Other Terms
1. Expenses. All expenses must be approved in writing in advance by the
CFO of OMNIS Software Inc. Upon approval employee must then provide documented
proof of all said incurred expenses.
2. Assistance. OSI shall provide Employee with access, information and
assistance reasonably requested by Employee to permit Employee to perform its
obligations under this Agreement.
5
<PAGE> 6
3. Proprietary Information and Inventions.
(a) "Confidential Information" means any OSI software source code (human
readable), proprietary information, technical data, trade secrets or know-how,
including, but not limited to, research, product plans, products, services,
customers, customer lists, markets, software, developments, inventions,
processes, formulas, technology, designs, drawings, engineering, hardware
configuration information, marketing, finances or other business information
disclosed by OSI either directly or indirectly in writing, orally or by drawings
or inspection of parts or equipment.
(b) Employee shall not, during or subsequent to employment at OSI, use
OSI's Confidential Information for any purpose whatsoever other than the
performance of the Services on behalf of OSI or disclose OSI's Confidential
Information to any third party, and it is understood that said Confidential
Information shall remain the sole property of OSI. Employee further agrees to
take all reasonable precautions to prevent any unauthorized disclosure of such
Confidential Information. Confidential Information does not include information
which (i) is known to Employee at the time of disclosure to Employee by OSI as
evidenced by written records of Employee, (ii) has become publicly known and
made generally available through no wrongful act of Employee, or (iii) has been
rightfully received by Employee from a third party who is authorized to make
such disclosure. Without OSI's prior written approval, Employee will not
directly or indirectly disclose to anyone the existence of this Agreement or the
material terms of this arrangement with OSI.
(c) Employee agrees that Employee will not, during the term of
employment at OSI, improperly use or disclose any proprietary information or
trade secrets of any former or current employer or other person or entity with
which Employee has an agreement or duty to keep in confidence information
acquired by Employee in confidence, if any, and that Employee will not bring
onto the premises of OSI any unpublished document or proprietary information
belonging to such employer, person or entity unless consented to in writing by
such employer, person or entity.
(d) Employee will indemnify OSI and hold it harmless from and against
all claims, liabilities, damages and expenses, including reasonable attorneys'
fees and costs of suit, arising out of or in connection with any violation or
claimed violation of a third party's rights resulting in whole or in part from
OSI's use of the work product of Employee under this Agreement.
(e) Employee recognizes that OSI has received and in the future will
receive from third parties their confidential or proprietary information subject
to a duty on OSI's part to maintain the confidentiality of such information and
to use it only for certain limited purposes. Employee agrees that Employee owes
OSI and such third parties, during the term of employment at OSI and thereafter,
a duty to hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any person, firm or corporation or to use
it except as necessary in carrying out the Services for OSI consistent with
OSI's agreement with such third party.
(f) Employee agrees that all copyrightable material, notes, records,
drawings, designs, inventions, improvements, developments, discoveries and trade
secrets as well as all derivations and modifications thereof or thereto
(collectively, "Inventions") conceived, made or discovered by Employee, solely
or in collaboration with others, in performing the Services hereunder, as well
as all intellectual property rights therein and thereto, are the sole property
of OSI; provided, however, that Employee hereby retains ownership of any
copyrightable material made in performing the Services hereunder that is a
derivative work of copyrightable material that is owned by Employee as of the
date of employment at OSI, and all intellectual property rights therein and
thereto. Employee further agrees to assign (or cause to be assigned) and does
hereby assign fully to OSI all such Inventions and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto.
(g) Employee agrees to assist OSI, or its designee, at OSI's expense, in
every proper way to secure OSI's rights in the Inventions assigned to OSI and
any copyrights, patents, mask work rights or other intellectual property rights
relating thereto in any and all countries, including the disclosure to OSI of
all pertinent information and data with respect thereto, the execution of all
applications, specifications, oaths, assignments and all other instruments which
OSI shall deem necessary in order to apply for and obtain such rights and in
order to assign and convey to OSI, its successors, assigns and nominees the sole
and exclusive rights, title and interest in and to such Inventions, and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto.
6
<PAGE> 7
Employee further agrees that Employee's obligation to execute or cause to be
executed, when it is in Employee's power to do so, any such instrument or papers
shall continue after the termination of employment at OSI. Employee shall
execute an assignment of Copyright.
(h) Employee agrees that if in the course of performing the Services,
Employee incorporates into any Invention developed hereunder any invention,
improvement, development, concept, discovery or other proprietary information
owned by Employee or in which Employee has an interest (whether made prior to
the date of employment at OSI), OSI is hereby granted and shall have a
non-exclusive, royalty-free, perpetual, irrevocable, worldwide license to make,
have made, modify, use, license and sell such item as part of or in connection
with such Invention, as required in the performance of OSI's obligations to the
OSI customer for whom the particular Services provided hereunder are being
performed.
(I) Employee shall not incorporate any invention, improvement,
development, concept, discovery or other proprietary information owned by any
third party into any invention without OSI' prior written permission.
(j) Employee agrees that if OSI is unable because of Employee's
unavailability, dissolution, incapacity, or for any other reason, to secure a
signature by or on behalf of Employee to apply for or to pursue any application
for any United States or foreign patents or mask work or copyright registrations
covering the Inventions assigned to OSI above, then Employee hereby irrevocably
designates and appoints OSI and its duly authorized officers and agents as
Employee's agent and attorney in fact, to act for and on Employee's behalf and
stead to execute and file any such applications and to do all other lawfully
permitted acts to further the prosecution and issuance of patents, copyright and
mask work registrations thereon with the same legal force and effect as if
executed by Employee.
(k) Employee hereby waives any and all moral rights, including the right
to identification of authorship or limitation on subsequent modification, that
Employee (or its employees) has or may have in any materials or other
deliverables assigned to OSI hereunder.
(l) Upon the termination of employment, or upon OSI's earlier request,
Employee will deliver to OSI in a timely manner all of OSI's property and/or
Confidential Information in tangible form that Employee may have in Employee's
possession or control. In the event of Employee's incapacity that causes
Employee to be unable to act further as an employee, any materials that have
been received or prepared by Employee pursuant to this Agreement and are in
Employee's possession shall be delivered to OSI by Employee's representative.
(m) Employee certifies that Employee has no outstanding agreement or
obligation that is in conflict with any of the provisions of this Agreement, or
that would adversely affect Employee's performance hereunder and further
certifies that Employee will not enter into any such conflicting Agreement
during the term of employment at OSI.
4. Loyalty and Non-Competition. You agree that, during the term of your
employment with OSI, you will not engage in any other employment, occupation,
consulting or other business activity directly related to the business in which
OSI is now involved or becomes involved during the term of your employment, nor
will you engage in any other activities that conflict with your obligations to
OSI. All such activity that exists as of the date of this Agreement may remain
in force, but no additional activity may be entered into. All such existing
activity must be disclosed on Attachment Schedule 1 hereto.
5. Non-Solicitation. During the term of employment and for a period of
twelve (12) months following its termination, Employee shall not solicit other
than for OSI the business of any of OSI's customers or prospects for which it
may have provided services directly or indirectly under this Agreement without
the prior written consent of OSI, such consent not to be unreasonably withheld.
In addition, during Employee's employment by the Company and for a period of
twelve (12) months following the termination of Employee's employment with the
Company, Employee agrees not to hire or attempt to hire any employees of the
Company.
6. Equipment. OSI understands that effective communication and computer
equipment is essential to the performance of the Employee. OSI agrees that
Employee will have a reasonable budget allocated for such expenses.
7
<PAGE> 8
7. Records. Employee shall maintain and make available to OSI upon
reasonable request reasonably detailed records related to progress and the
expenditure of time and materials and other costs. In addition, Employee agrees
that it will from time to time during the term of employment keep OSI advised as
to Employee's progress in completion of setforth goals.
8. Qualifications of Employee. Employee hereby represents and warrants
that Employee has the expertise to perform the services contemplated herein.
Employee shall perform the services in a diligent manner using reasonable
professional skill and care.
9. Disputes. In the event of any dispute or claim relating to or
arising out of our employment relationship, Employee and OSI agree that all such
disputes, including but not limited to, claims of harassment, discrimination and
wrongful termination, shall be settled by arbitration held in San Francisco,
California, under the Arbitration Rules set forth in California Code of Civil
Procedure Section 1280, et seq., including section 1283.05, (the "Rules") and
pursuant to California law. A copy of the Rules is available for review prior to
signing this Agreement. Employee understands that by signing this Agreement,
employee is consenting to waive the right to a jury trial for any claims or
disputes arising from employment with OSI. Each party agrees to bear the cost of
its own attorneys' fees. Employee also understands that each party's promise to
resolve claims through arbitration in accordance with the terms of this
Agreement, rather than through the courts, is consideration for the other
party's like promise. Employee also understands that the offer of employment
with the Company is consideration for the promise to arbitrate claims.
10. Governing Law. This Agreement will be governed by the laws of the
State of California. The parties hereby expressly consent to the personal
jurisdiction of the state and federal courts located in California for any
lawsuit filed there by the Company arising from or relating to this Agreement or
to the employment relationship.
11. Entire Agreement; Amendment. This Agreement sets forth the entire
agreement and understanding between the Company and employee relating to the
subject matter herein and supersedes all prior discussions. No modification of
or amendment to this Agreement, nor any waiver of any rights under this
agreement, will be effective unless in writing signed by the party to be
charged. Any subsequent change or changes in employee's duties, salary or
compensation will not affect the validity or scope of this Agreement.
12. Successors and Assigns. This Agreement is binding on and inures to
the benefit of the parties and their heirs, successors, assigns and personal
representatives.
13. Severability. If any provisions of this Agreement is voided by a
court, the remaining provisions shall remain in full force and effect.
To indicate your acceptance of this Employee Agreement please sign and date in
the space provided below.
In Witness Whereof, the parties hereby agree to the terms of this
Employment Agreement as of the last date set forth below.
EMPLOYEE OMNIS SOFTWARE INC.
- ----------------------------------- --------------------------------
Kevin Doyle Kenneth P. Holmes
President, CEO
- ----------------------------------- --------------------------------
Date Date
8
<PAGE> 1
Exhibit 10.5
[OMNIS SOFTWARE INC. LETTERHEAD]
Dear Mr. Barcot:
It is my pleasure to offer you the position of Vice President of US Sales of
OMNIS Software, Inc. (the "Company" or "OSI") reporting to me starting on or
about April 1, 1998. Your semi-monthly salary will be $3,333.33. This is
equivalent to an annual base salary of $80,000. You are also eligible for a
variable compensation plan of up to 150% of your annual salary based on 125%
attainment of quarterly milestones. This compensation plan is outlined in
Attachment A.
You have expressly requested not to receive any Paid Time Off ("PTO") benefits.
You understand and acknowledge that this agreement, with respect to the PTO
benefits, overrides the Company's policy stated in the Employee Handbook.
- ----------
L. Barcot Initials
Upon your acceptance of the terms of this letter and Employee Agreement
(Attachment A) we will recommend to the Board that you be granted non-qualified
stock options of the Company's common stock, as outlined in Attachment A. These
options will be granted at the fair market value of the Company's common stock
as of the first board meeting following the date of your signature below.
This offer is contingent upon you presenting, in accordance with the Immigration
Reform and Control Act of 1986, verification of your identity and your legal
right to work in the United States. In the event that you do not possess, or are
unable to obtain authorization to accept employment in the U.S., our offer of
employment is withdrawn.
As a condition of your employment with OSI you will also be required to sign the
enclosed Employee Agreement (Attachment A).
This letter, together with the enclosed attachments, sets forth the terms of
your employment with the Company and supersede any prior representations or
agreements, whether written or oral. This letter may not be modified or amended
except by a written agreement, signed by the President of the Company and by
you.
Notwithstanding the foregoing, you are aware that employment at OMNIS Software
Inc. is for no specific period and constitutes at will employment. As a result,
you are free to resign at any time, for any reason or for no reason. Similarly,
OSI is free to conclude its employment relationship with you at any time, with
or without cause, and with or without notice.
I look forward to a favorable reply and welcoming you to OMNIS Software Inc.
Sincerely, Accepted By:
------------------------------
Larry Barcot
Kenneth P. Holmes
President, CEO
-------------------------------
Date
Enclosures:
Attachment A
Schedule 1
1
<PAGE> 2
ATTACHMENT A
EMPLOYEE AGREEMENT
This document defines the standard terms of employment for Larry Barcot
("Employee") in his role as Vice President of US Sales at OMNIS Software, Inc.
(the "Company" or "OSI") including the Performance Requirements and Compensation
Plan for this position.
TERMS
A. COMPENSATION:
The total targeted compensation is made up of your base salary and bonus. The
total targeted annual compensation at 100% of plan is $160,000, excluding any
stock options.
1. Base Salary: Your base salary is $80,000 per year, which will be
paid through the regular semi-monthly company payroll at $3,333.33 per pay
period.
2. Deferred Compensation/Bonus: During the 18 months ending September
30, 1999, following the end of each fiscal quarter (June 30, September 30,
December 31 and March 31 of each year) you will be paid a bonus equal to a
percentage of your quarterly base salary for such preceding quarter as
compensation for satisfying the criteria set forth below, provided that no bonus
will be paid for any quarter in which the Company's cumulative expenses for any
areas under your supervision, including North American sales and Worldwide
marketing ("Managed Marketing Expenses") exceed the limits set forth below. The
bonus for the quarter ending June 30, 1998, if any, will be paid in the amount
of $5,000 as per standard payroll practices with the residual amount of the
bonus, if any, to be paid by December 31, 1998.
Bonus Amounts: The quarterly bonus, if any, will be equal to:
(a) 150% of quarterly base salary if the Company's cumulative
revenues (as recognized on the basis of U.S. generally accepted accounting
principals and in conformity with the Company's revenue recognition policies)
from world-wide sales of products related to the Company's OMNIS Studio product
line ("Studio Revenue") as of the end of such quarter equal or exceed of 125% of
target cumulative Studio Revenue for such quarter as set forth below.
(b) 100% of quarterly base salary if the Company's cumulative
Studio Revenue as of the end of such quarter equal or exceed 100% and are less
than 125% of target cumulative Studio Revenue for such quarter as set forth
below.
(c) 50% of quarterly base salary if the Company's cumulative
Studio Revenue as of the end of such quarter exceed 90% and are less than 100%
of target cumulative Studio Revenue for such quarter as set forth below.
(d) Zero percent (0%) of quarterly base salary if the
Company's cumulative Studio Revenue as of the end of such quarter equal or are
less than 90% of target cumulative Studio Revenue for such quarter as set forth
below.
CUMULATIVE TARGETED STUDIO REVENUE:
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999*
<S> <C> <C> <C> <C> <C> <C>
90% of targeted revenue $ 33,613 $ 305,987 $ 925,815 $1,869,809 $3,112,154 $6,128,584
100% of targeted revenue $ 37,348 $ 339,986 $1,028,683 $2,077,565 $3,457,949 $6,809,538
</TABLE>
2
<PAGE> 3
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
125% of targeted revenue $ 46,684 $ 424,982 $1,285,854 $2,596,957 $4,322,436 $8,511,923
</TABLE>
*It is agreed that as $750,000 of projected revenue in the quarter ending
September 30, 1999 includes revenue from upgrade fees for Studio 3.0.
Accordingly, if that release of the product is not generally available by August
30, 1999, the revenue target in that quarter will be reduced by $750,000.
CUMULATIVE TARGETED MANAGED MARKETING EXPENSES (NOT TO EXCEED):
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999
<S> <C> <C> <C> <C> <C>
$156,500 $443,500 $878,500 $1,123,500 $1,468,500 $1,813,500
</TABLE>
The following table sets forth for illustration purposes the amount of
Employee's bonus in each quarter if Employee obtains the indicated levels of
targeted Studio Revenue.
BONUS COMPENSATION ILLUSTRATION:
<TABLE>
<CAPTION>
June 30 Sep. 30 Dec. 31 Mar. 31 June 30 Sep. 30
1998 1998 1998 1999 1999 1999
<S> <C> <C> <C> <C> <C> <C>
% of Targeted Studio
Revenue
@ 90% or below 0 0 0 0 0 0
Above 90%, below 100% $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
At or Above 100%, below 125% $20,000 $20,000 $20,000 $20,000 $20,000 $20,000
At 125% or above $30,000 $30,000 $30,000 $30,000 $30,000 $30,000
</TABLE>
3. Stock Compensation:
Upon signing this agreement, the President of the Company will recommend to the
Board of Directors of OMNIS Technology Corporation that you be granted
non-qualified options (the "Options") to purchase 240,000 shares of OMNIS
Technology Corporation's common stock. These options will be granted at the fair
market value of the Company's common stock as of the date of the first board
meeting following the date of your signature below and on all enclosed
contracts. These options will vest 100% at the end of 6 years from the date
hereof provided you continuously serve as an employee of the Company during such
period, except as provided below. The terms of this option grant will be set
forth in an option agreement dated the date of such grant, which option
agreement will controls the terms of the option grant.
ACCELERATION OF OPTIONS
Based on the average closing sale price of OMNIS Technology Corporation's common
stock for the ten trading days ending on September 30, 1999, the vesting of some
or all of the Options may accelerate and will vest immediately as per the
Acceleration Schedule below. Options whose vesting is not so accelerated at
September 30, 1999 will continue to vest in accordance with the vesting schedule
described above so long as Employee continues to be an employee of the Company.
In no event will your options continue to vest past September 30, 1999 if you
are no longer an employee of OSI. If Employee's employment with the Company is
terminated for Cause (as defined below) or Employee terminates his employment
with the Company for any reason, Employee will have the standard period of time
to exercise your vested options as per the Company's Stock Option Plan, if any,
and, if such termination occurs prior to September 30, 1999, all vesting of the
Options will terminate and no acceleration of vesting of the Options will occur.
If the Company terminates the Employee's employment for any reason other than
Cause, Employee's Options may vest pursuant to the Acceleration Schedule below
on September 30, 1999.
3
<PAGE> 4
Any Options not accelerated on September 30, 1999 pursuant to the Acceleration
Schedule below will expire as per the standard stock option plan guidelines if
Employee is no longer an employee of OSI.
If OMNIS Technology Corporation merges or is acquired prior to September 30,
1999 and (I) Employee is an employee of the Company on the date of such merger
or acquisition and (II) the result of which is the owners of OMNIS Technology
Corporation's outstanding common stock immediately prior to such transaction own
less than 50% of the shares of the resulting corporation following such
transaction, then Employee's options may accelerate as per the Acceleration
Schedule below based upon the per share price of OMNIS Technology Corporation's
Common Stock price on the date immediately prior to the date of such acquisition
or merger.
If OSI merges or is acquired after September 30, 1999 no Options shall
accelerate under the Acceleration Schedule below.
ACCELERATION SCHEDULE
The acceleration of options, if any, will occur as follows on September 30,
1999.
<TABLE>
<CAPTION>
OMNIS Technology Corporation Number of Shares Fully
per share Stock Price* Vested on September 30, 1999
- ---------------------- ----------------------------
<S> <C>
$18 240,000
$15 180,000
$12 120,000
$ 9 91,200
$ 6 60,000
</TABLE>
*As adjusted for any stock splits, stock dividends, recapitalization or similar
events.
B. Termination
1. At Will Employment. EMPLOYEE UNDERSTANDS AND ACKNOWLEDGES THAT
EMPLOYMENT WITH OSI IS FOR AN UNSPECIFIED DURATION AND CONSTITUTES "AT-WILL"
EMPLOYMENT. EMPLOYEE ALSO UNDERSTANDS THAT ANY REPRESENTATION TO THE CONTRARY IS
UNAUTHORIZED AND NOT VALID UNLESS OBTAINED IN WRITING AND SIGNED BY THE
PRESIDENT OF OSI. EMPLOYEE ACKNOWLEDGES THAT THIS EMPLOYMENT RELATIONSHIP MAY BE
TERMINATED AT ANY TIME, WITH OR WITHOUT GOOD CAUSE OR FOR ANY OR NO CAUSE, AT
THE OPTION EITHER OF OSI OR EMPLOYEE, WITH OR WITHOUT NOTICE.
2. Termination for Cause.
Employee agrees that the Company may at its option terminate his employment
immediately and without prior notice for any of the following reasons ("Cause"):
(i) theft, dishonesty, or falsification of any employment
or Company, its subsidiaries or affiliates' records;
or
(ii) improper disclosure of the Company, its subsidiaries
or affiliates' confidential or proprietary
information; or
(iii) any intentional act by Employee which causes loss,
damage, or injury to the Company, its subsidiaries or
affiliates' property, reputation, employees, or
business; or
4
<PAGE> 5
(iv) Employee's failure to perform to the minimum
standards of a written plan mutually agreed upon by
employee and the Company, as stated below under
Minimum Plan, provided such failure is not cured
within thirty (30) days following written notice of
such failure from the Company; or
(v) any material breach of this Agreement, which breach
is not cured within thirty (30) days following
written notice of such breach from the Company; or
(vi) failure to comply with Company's policies as stated
in the OMNIS Software Employee Handbook; or
(vii) engaging in any employment, occupation, consulting or
other business activity directly related to the
business in which OSI is now involved or becomes
involved during the term of your employment. All such
activity that exists as of the date of this Agreement
may remain in force, but no additional activity may
be entered into. All such existing activity must be
disclosed on Schedule 1 hereto; or
(viii) cumulative Managed Marketing Expenses at the end of
any quarter exceed the limits for such quarter set
forth above without the prior written approval by the
CFO of OSI.
MINIMUM PLAN:
For purposes of this Agreement, the Minimum Plan referred to in paragraph (iv)
above is as follows:
Through March 31, 1999:
(a) $1.3 million in cumulative world-wide Studio Revenue
for the period ending March 31, 1999,; and
Through September 30, 1999:
(a) $4.1 million in total world-wide Studio Revenue for
the period ending September 30, 1999; and
C. Other Terms
1. Expenses. All expenses must be approved in writing in advance by the
CFO of OMNIS Software Inc. Upon approval employee must then provide documented
proof of all said incurred expenses.
2. Assistance. OSI shall provide Employee with access, information and
assistance reasonably requested by Employee to permit Employee to perform its
obligations under this Agreement.
5
<PAGE> 6
3. Proprietary Information and Inventions.
(a) "Confidential Information" means any OSI software source
code (human readable), proprietary information, technical data, trade secrets or
know-how, including, but not limited to, research, product plans, products,
services, customers, customer lists, markets, software, developments,
inventions, processes, formulas, technology, designs, drawings, engineering,
hardware configuration information, marketing, finances or other business
information disclosed by OSI either directly or indirectly in writing, orally or
by drawings or inspection of parts or equipment.
(b) Employee shall not, during or subsequent to employment at
OSI, use OSI's Confidential Information for any purpose whatsoever other than
the performance of the Services on behalf of OSI or disclose OSI's Confidential
Information to any third party, and it is understood that said Confidential
Information shall remain the sole property of OSI. Employee further agrees to
take all reasonable precautions to prevent any unauthorized disclosure of such
Confidential Information. Confidential Information does not include information
which (i) is known to Employee at the time of disclosure to Employee by OSI as
evidenced by written records of Employee, (ii) has become publicly known and
made generally available through no wrongful act of Employee, or (iii) has been
rightfully received by Employee from a third party who is authorized to make
such disclosure. Without OSI's prior written approval, Employee will not
directly or indirectly disclose to anyone the existence of this Agreement or the
material terms of this arrangement with OSI.
(c) Employee agrees that Employee will not, during the term of
employment at OSI, improperly use or disclose any proprietary information or
trade secrets of any former or current employer or other person or entity with
which Employee has an agreement or duty to keep in confidence information
acquired by Employee in confidence, if any, and that Employee will not bring
onto the premises of OSI any unpublished document or proprietary information
belonging to such employer, person or entity unless consented to in writing by
such employer, person or entity.
(d) Employee will indemnify OSI and hold it harmless from and
against all claims, liabilities, damages and expenses, including reasonable
attorneys' fees and costs of suit, arising out of or in connection with any
violation or claimed violation of a third party's rights resulting in whole or
in part from OSI's use of the work product of Employee under this Agreement.
(e) Employee recognizes that OSI has received and in the
future will receive from third parties their confidential or proprietary
information subject to a duty on OSI's part to maintain the confidentiality of
such information and to use it only for certain limited purposes. Employee
agrees that Employee owes OSI and such third parties, during the term of
employment at OSI and thereafter, a duty to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to
any person, firm or corporation or to use it except as necessary in carrying out
the Services for OSI consistent with OSI's agreement with such third party.
(f) Employee agrees that all copyrightable material, notes,
records, drawings, designs, inventions, improvements, developments, discoveries
and trade secrets as well as all derivations and modifications thereof or
thereto (collectively, "Inventions") conceived, made or discovered by Employee,
solely or in collaboration with others, in performing the Services hereunder, as
well as all intellectual property rights therein and thereto, are the sole
property of OSI; provided, however, that Employee hereby retains ownership of
any copyrightable material made in performing the Services hereunder that is a
derivative work of copyrightable material that is owned by Employee as of the
date of employment at OSI, and all intellectual property rights therein and
thereto. Employee further agrees to assign (or cause to be assigned) and does
hereby assign fully to OSI all such Inventions and any copyrights, patents, mask
work rights or other intellectual property rights relating thereto.
(g) Employee agrees to assist OSI, or its designee, at OSI's
expense, in every proper way to secure OSI's rights in the Inventions assigned
to OSI and any copyrights, patents, mask work rights or other intellectual
property rights relating thereto in any and all countries, including the
disclosure to OSI of all pertinent information and data with respect thereto,
the execution of all applications, specifications, oaths, assignments and all
other instruments which OSI shall deem necessary in order to apply for and
obtain such rights and in order to assign and convey to OSI, its successors,
assigns and nominees the sole and exclusive rights, title and interest in and to
such Inventions, and any copyrights, patents, mask work rights or other
intellectual property rights relating thereto.
6
<PAGE> 7
Employee further agrees that Employee's obligation to execute or cause to be
executed, when it is in Employee's power to do so, any such instrument or papers
shall continue after the termination of employment at OSI. Employee shall
execute an assignment of Copyright.
(h) Employee agrees that if in the course of performing the
Services, Employee incorporates into any Invention developed hereunder any
invention, improvement, development, concept, discovery or other proprietary
information owned by Employee or in which Employee has an interest (whether made
prior to the date of employment at OSI), OSI is hereby granted and shall have a
non-exclusive, royalty-free, perpetual, irrevocable, worldwide license to make,
have made, modify, use, license and sell such item as part of or in connection
with such Invention, as required in the performance of OSI's obligations to the
OSI customer for whom the particular Services provided hereunder are being
performed.
(I) Employee shall not incorporate any invention, improvement,
development, concept, discovery or other proprietary information owned by any
third party into any invention without OSI' prior written permission.
(j) Employee agrees that if OSI is unable because of
Employee's unavailability, dissolution, incapacity, or for any other reason, to
secure a signature by or on behalf of Employee to apply for or to pursue any
application for any United States or foreign patents or mask work or copyright
registrations covering the Inventions assigned to OSI above, then Employee
hereby irrevocably designates and appoints OSI and its duly authorized officers
and agents as Employee's agent and attorney in fact, to act for and on
Employee's behalf and stead to execute and file any such applications and to do
all other lawfully permitted acts to further the prosecution and issuance of
patents, copyright and mask work registrations thereon with the same legal force
and effect as if executed by Employee.
(k) Employee hereby waives any and all moral rights, including
the right to identification of authorship or limitation on subsequent
modification, that Employee (or its employees) has or may have in any materials
or other deliverables assigned to OSI hereunder.
(l) Upon the termination of employment, or upon OSI's earlier
request, Employee will deliver to OSI in a timely manner all of OSI's property
and/or Confidential Information in tangible form that Employee may have in
Employee's possession or control. In the event of Employee's incapacity that
causes Employee to be unable to act further as an employee, any materials that
have been received or prepared by Employee pursuant to this Agreement and are in
Employee's possession shall be delivered to OSI by Employee's representative.
(m) Employee certifies that Employee has no outstanding
agreement or obligation that is in conflict with any of the provisions of this
Agreement, or that would adversely affect Employee's performance hereunder and
further certifies that Employee will not enter into any such conflicting
Agreement during the term of employment at OSI.
4. Loyalty and Non-Competition. You agree that, during the term of your
employment with OSI, you will not engage in any other employment, occupation,
consulting or other business activity directly related to the business in which
OSI is now involved or becomes involved during the term of your employment, nor
will you engage in any other activities that conflict with your obligations to
OSI. All such activity that exists as of the date of this Agreement may remain
in force, but no additional activity may be entered into. All such existing
activity must be disclosed on Attachment Schedule 1 hereto.
5. Non-Solicitation. During the term of employment and for a period of
twelve (12) months following its termination, Employee shall not solicit other
than for OSI the business of any of OSI's customers or prospects for which it
may have provided services directly or indirectly under this Agreement without
the prior written consent of OSI, such consent not to be unreasonably withheld.
In addition, during Employee's employment by the Company and for a period of
twelve (12) months following the termination of Employee's employment with the
Company, Employee agrees not to hire or attempt to hire any employees of the
Company.
6. Equipment. OSI understands that effective communication and computer
equipment is essential to the performance of the Employee. OSI agrees that
Employee will have a reasonable budget allocated for such expenses.
7
<PAGE> 8
7. Records. Employee shall maintain and make available to OSI upon
reasonable request reasonably detailed records related to progress and the
expenditure of time and materials and other costs. In addition, Employee agrees
that it will from time to time during the term of employment keep OSI advised as
to Employee's progress in completion of setforth goals.
8. Qualifications of Employee. Employee hereby represents and warrants
that Employee has the expertise to perform the services contemplated herein.
Employee shall perform the services in a diligent manner using reasonable
professional skill and care.
9. Disputes. In the event of any dispute or claim relating to or
arising out of our employment relationship, Employee and OSI agree that all such
disputes, including but not limited to, claims of harassment, discrimination and
wrongful termination, shall be settled by arbitration held in San Francisco,
California, under the Arbitration Rules set forth in California Code of Civil
Procedure Section 1280, et seq., including section 1283.05, (the "Rules") and
pursuant to California law. A copy of the Rules is available for review prior to
signing this Agreement. Employee understands that by signing this Agreement,
employee is consenting to waive the right to a jury trial for any claims or
disputes arising from employment with OSI. Each party agrees to bear the cost of
its own attorneys' fees. Employee also understands that each party's promise to
resolve claims through arbitration in accordance with the terms of this
Agreement, rather than through the courts, is consideration for the other
party's like promise. Employee also understands that the offer of employment
with the Company is consideration for the promise to arbitrate claims.
10. Governing Law. This Agreement will be governed by the laws of the
State of California. The parties hereby expressly consent to the personal
jurisdiction of the state and federal courts located in California for any
lawsuit filed there by the Company arising from or relating to this Agreement or
to the employment relationship.
11. Entire Agreement; Amendment. This Agreement sets forth the entire
agreement and understanding between the Company and employee relating to the
subject matter herein and supersedes all prior discussions. No modification of
or amendment to this Agreement, nor any waiver of any rights under this
agreement, will be effective unless in writing signed by the party to be
charged. Any subsequent change or changes in employee's duties, salary or
compensation will not affect the validity or scope of this Agreement.
12. Successors and Assigns. This Agreement is binding on and inures to
the benefit of the parties and their heirs, successors, assigns and personal
representatives.
13. Severability. If any provisions of this Agreement is voided by a
court, the remaining provisions shall remain in full force and effect.
To indicate your acceptance of this Employee Agreement please sign and date in
the space provided below.
In Witness Whereof, the parties hereby agree to the terms of this
Employment Agreement as of the last date set forth below.
EMPLOYEE OMNIS SOFTWARE INC.
- ----------------------------------- --------------------------------
Larry Barcot Kenneth P. Holmes
President, CEO
- ----------------------------------- --------------------------------
Date Date
8
<PAGE> 1
Exhibit 99.1
[OMNIS SOFTWARE INC. LETTERHEAD]
FOR IMMEDIATE RELEASE
Meredith Dudley
Public Relations
[email protected]
(650) 829-7159
Kenneth Holmes
Chief Financial Officer
[email protected]
(650) 829-7172
OMNIS SOFTWARE SECURES EQUITY FINANCING
$1 Million Note to be Extended
SAN BRUNO, CA, April 14, 1998 - OMNIS Technology Corp., (NASDAQ OTC BB: "OMNS")
today announced that it has agreed to sell up to 126,000 shares of series A
preferred stock, at a price of $.80 per share, to a significant stockholder.
Each share of preferred stock converts into 10 shares of common stock.
Concurrent with the execution of this agreement, the Company sold the first
50,000 shares of series A preferred stock. These proceeds will be used to fund
the Company's operations designed to achieve profitability and the expansion of
its US based sales & marketing programs. OMNIS expects to sell the additional
shares of series A preferred stock in the upcoming quarters; a portion of
which will fund future working capital requirements, and the remaining shares
to be sold upon the successful completion of negotiations with its unsecured
creditors.
The Company also announced that the $1 million debt financing of October
1997, which became due March 31, 1998, was again extended. The note is now due
June 30, 1998. The Company does not expect to repay the note by June 30, 1998,
and believes the due date will again be extended.
Having secured this key investment as part of the effort to reorganize
the company, Kenneth Holmes, Chief Financial Officer and acting Chief Executive
Officer of OMNIS stated "with the expansion of our sales and marketing efforts,
we are targeting a near break-even first quarter, ending June 30, 1998. This
company has many challenges in front of it, but thanks to a strong partner
channel, which provides a stable revenue stream, we feel confident in meeting
our goals."
-more-
<PAGE> 2
OMNIS SECURES FINANCING/2
OMNIS TECHNOLOGY CORPORATION
OMNIS is a leader in developing and deploying component engineering
software. The OMNIS Studio and OMNIS 7 product lines support the full life
cycle of applications and are ideal for the rapid development and deployment of
sophisticated Web and client/server applications, providing true re-use of
software objects and the unique ability to integrate objects from disparate
programming languages. OMNIS Studio is the first component engineering system
to integrate JavaBean and ActiveX components.
The statements in this press release may contain forward-looking statements
that involve risk and uncertainties that could cause actual results to differ
from predicted results. Such risks include, among others, the Company's
continuing significant liquidity problems, significant variability in operating
results, including variability in product revenues and gross margins,
fluctuating demand for new and established products, dependence on new
products, dependence on markets acceptance of new products, increasing expenses
for marketing and development of new products, historical lack of
profitability, rapid technological change and risks associated with global
operations. Further risks are described in the Company's Form 10-K filed with
the Securities and Exchange Commission on June 30, 1997, and other risks
detailed from time to time in the Company's reports filed with the Securities
and Exchange Commission. The Company undertakes no obligation to publicly
release the result of any revisions to these forward-looking statements which
may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
# # #
Copyright 1998. OMNIS is a registered trademark of OMNIS Software, Inc. OMNIS
Studio and OMNIS 7 are trademarks of OMNIS Software, Inc.
<PAGE> 1
Exhibit 99.2
[OMNIS SOFTWARE INC. LETTERHEAD]
FOR IMMEDIATE RELEASE
Meredith Dudley
Public Relations
[email protected]
(650) 829-7159
Kenneth Holmes
Chief Financial Officer
[email protected]
(650) 829-7172
OMNIS CHANNEL PARTNERS JOIN EXECUTIVE TEAM
Board Advisory Committee Formed
SAN BRUNO, CA, May 21, 1998 - OMNIS Technology Corp., (NASDAQ BB: "OMNS") today
announced the appointment of two senior executives to spearhead a revitalized
worldwide sales & marketing campaign. Kevin J. Doyle was named Vice President
of Worldwide Marketing, and Larry A. Barcot as Vice President of US Sales. They
each bring with them over 15 years of experience as OMNIS developers,
consultants and solution providers to enterprise clients. Mr. Doyle and Mr.
Barcot have operated as a team in the past, having founded the Macintosh
Computing Network (MCN) consulting organization in 1988. This organization
brought together highly successful program implementations with significant
contacts throughout the computer industry.
OMNIS also announced the appointment of David M. Ferri as the first
member of a newly formed Advisory Committee to the Board of Directors. Mr.
Ferri is President of Word Master, Inc., a Deerfield, IL based consulting firm
specializing in the OMNIS family of products, and a channel partner of OMNIS
for more than 10 years. The committee will advise the board in all matters
where specific OMNIS channel knowledge is essential.
"OMNIS has been focused on selling to and expanding its channel for many
years," said Kenneth Holmes, CFO and acting CEO of OMNIS. "These additions put
us in the advantageous position of having two well-known executives, and former
channel partners, selling into a community they are intimately familiar with.
Kevin and Larry's understanding of our market and industry is an important
piece in the restructuring of OMNIS. Also, the addition to our Board of an
advisor with direct knowledge of our product line and market will strength our
ability to navigate a return to profitability and will add an OMNIS specific
perspective to the board."
-more-
<PAGE> 2
CHANNEL PARTNERS JOIN OMNIS/2
"This is a very exciting development and opportunity for OMNIS Software,"
remarked Bruce Whetstone, former Director of Corporate Information
Technologies, Amgen, Inc. "Mr. Doyle and Mr. Barcot are an excellent choice due
to their considerable talents and experience, combined with their deep
understanding of the needs of end-users, and their long-term relationships with
the software development and consulting communities."
"For 15 years, I have felt that OMNIS is the best in class," said Doyle.
"The time has come to let the world know that OMNIS is one of the most
comprehensive, feature-rich development environments ever built. I relish the
opportunity to display its power to the developer community." Barcot added,
"Our largest asset is our loyal developer base, their abilities, and their
solutions. Many of these entrepreneurs have been deploying solutions into their
vertical markets using OMNIS products for years. Our plans will bring this
experience to the developer community at large."
OMNIS TECHNOLOGY CORPORATION
OMNIS is a leader in developing and deploying component engineering
software. The OMNIS Studio and OMNIS 7 product lines support the full life
cycle of applications and are ideal for the rapid development and deployment of
sophisticated Web and client/server applications, providing true re-use of
software objects and the unique ability to integrate objects from disparate
programming languages. OMNIS Studio is the first component engineering system
to integrate JavaBean and ActiveX components.
The statements in this press release may contain forward-looking statements
that involve risk and uncertainties that could cause actual results to differ
from predicted results. Such risks include, among others, the Company's
continuing significant liquidity problems, significant variability in operating
results, including variability in product revenues and gross margins,
fluctuating demand for new and established products, dependence on new
products, dependence on market acceptance of new products, increasing expenses
for marketing and development of new products, historical lack of
profitability, rapid technological change and risks associated with global
operations. Further risks are described in the Company's Form 10-K filed with
the Securities and Exchange Commission on June 30, 1997, and other risks
detailed from time to time in the Company's reports filed with the Securities
and Exchange Commission. The Company undertakes no obligation to publicly
release the result of any revisions to these forward-looking statements which
may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
# # #
Copyright 1998. OMNIS is a registered trademark of OMNIS Software, Inc. OMNIS
Studio and OMNIS 7 are trademarks of OMNIS Software, Inc.
