Warrant Agreement - MangoSoft INc. and Fleet National Bank
MANGOSOFT, INC.
WARRANT AGREEMENT
This Warrant Agreement (this "Agreement"), dated as of February 11, 2002, is
made by and between MangoSoft, Inc., a corporation organized under the laws of
the State of Nevada (the "Company"), and Fleet National Bank (which shall have
the right to designate FSC Corp. and/or another affiliate to be issued the
"Warrants" (as defined below)) (the "Warrantholder").
Subject to the terms and conditions hereof, the Company agrees to issue to
the Warrantholder warrants as hereinafter described (the "Warrants") to purchase
up to the aggregate number of shares of common stock of the Company, par value
$0.00l per share (the "Common Stock"), at the initial Warrant Price of $0.53 per
share of Common Stock, in accordance with the provisions of Section 3 hereof,
subject to adjustment as provided herein.
As used herein: (i) the terms "Share" or "Shares" shall mean collectively the
Common Stock issuable upon exercise of the Warrants together with any other
securities issuable upon such exercise as provided herein; (ii) the term
"Warrants" shall include any and all warrants outstanding pursuant to this
Agreement, including those evidenced by a certificate or certificates issued
upon division, exchange or substitution pursuant to this Agreement; and (iii)
the term "Warrant Price" shall mean the price per share of Common Stock at which
the Common Stock shall at any time be purchasable upon exercise of the Warrants.
For the purpose of defining the terms and provisions of the Warrants and the
respective rights and obligations thereunder, the Company and the Warrantholder,
for value received, the adequacy and sufficiency of which are hereby
acknowledged, agree as follows:
Section 1. Transferability and Form of Warrants.
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1.1 Registration. The Warrants shall be numbered and shall be registered
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on the books of the Company when issued in accordance with Nevada
corporate practice.
1.2 Transfer. The Warrants shall be transferable only on the books of
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the Company maintained at its principal office in Westborough,
Massachusetts or wherever its principal office may then be located, upon
delivery thereof duly endorsed by the Warrantholder seeking such
transfer or by its duly authorized attorney or representative,
accompanied by proper evidence of succession, assignment or authority to
transfer. Upon any registration of transfer, the Company shall execute
and deliver new Warrants to the person entitled thereto.
1.3 Form of Warrants. The form of certificate evidencing the Warrants
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shall be substantially as attached hereto. Certificates evidencing the
Warrants shall be executed on behalf of the Company by its President or
any Vice President, and shall be dated as of the date of execution
thereof.
1.4 Legend on Warrants and Shares. The Warrants, and the Shares issuable
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upon the exercise thereof, have not been registered under the Securities
Act of 1933, as amended (the "Securities Act"). Each certificate for the
Warrants shall bear the following legend:
"THE WARRANTS REPRESENTED BY THIS CERTIFICATE, AND
THE COMMON STOCK ISSUABLE UPON EXERCISE OF SUCH
WARRANTS, HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF
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ANY STATE OF THE UNITED STATES. SUCH WARRANTS MAY NOT BE SOLD,
ASSIGNED, EXCHANGED OR OTHERWISE TRANSFERRED IN ANY MANNER AND
SUCH COMMON STOCK MAY NOT BE OFFERED FOR SALE, SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT AN EXEMPTION FROM SUCH
REGISTRATION IS AVAILABLE."
And each certificate for the Shares shall bear substantially the
following legend:
"THE COMMON STOCK REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 OR THE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE
OFFERED FOR SALE, SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE."
Any certificate issued at any time in exchange or substitution for
any certificate bearing such legend (except a new certificate issued
upon completion of a public distribution pursuant to a registration
statement under the Securities Act of the securities represented
thereby) shall also bear a like legend unless, in the opinion of the
Company's counsel, the securities represented thereby need no longer be
subject to such restrictions.
Section 2. Exchange of Warrant Certificate. Any Warrant certificate may be
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exchanged for another certificate or certificates entitling a Warrantholder to
purchase a like aggregate number of Shares as the certificate or certificates
surrendered then entitles such Warrantholder to purchase. Any Warrantholder
desiring to exchange a Warrant certificate shall make such request in writing
delivered to the Company, and shall surrender, properly endorsed, the
certificate evidencing the Warrant to be so exchanged. Thereupon, the Company
shall execute and deliver to the person entitled thereto a new Warrant
certificate as so requested.
Section 3. Term, Issuance and Exercise of Warrants.
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(a) Subject to the terms of this Agreement, each Warrantholder shall
have the right, at any time prior to 5 p.m., Eastern time, on (i)
February 11, 2007, in respect of the Warrants to be issued to the
Warrantholder by the Company on February 11, 2002 pursuant to Section
3(b) hereof; (ii) February 11, 2008, in respect of the Warrants to be
issued to the Warrantholder by the Company on February 11, 2003 pursuant
to Section 3(b) hereof and (iii) February 11, 2009, in respect of the
Warrants to be issued to the Warrantholder by the Company on February
11, 2004 pursuant to Section 3(b) hereof (as applicable to each such
tranche of Warrants, the "Termination Date"), to purchase from the
Company up to the number of fully paid and nonassessable Shares which
such Warrantholder may at the time be entitled to purchase pursuant to
Section 3(b) of this Agreement, upon surrender to the Company at its
principal office of the certificates evidencing the Warrants to be
exercised, with the attached purchase form duly completed and signed,
and upon payment to the Company of the Warrant Price (as determined in
accordance with the provisions hereof) for the number of Shares in
respect of which such Warrants are then exercised, but in no event for
fewer than 100 Shares (unless fewer than an aggregate of 100 Shares are
then purchasable under all outstanding Warrants held of record by a
Warrantholder). Payment of the aggregate Warrant Price shall be made in
cash, certified or cashier's check, wired funds, or any combination
thereof.
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(b) On the date hereof, the Company shall issue to the Warrantholder, at
the Warrant Price, one hundred fifty thousand (150,000) Warrants
(subject to adjustment pursuant to Section 7 below). On or about each of
the first and second anniversary dates of this Agreement, the Company
shall issue to the Warrantholder, at the Warrant Price, one Warrant for
each dollar of gross revenue actually collected by the Company in the
year prior to such anniversary date (the "Revenue"), up to an aggregate
of eight hundred fifty thousand (850,000) Warrants (subject to
adjustment pursuant to Section 7 below) during such two-year period, in
respect of the sales of the Filetrust software application
("Filetrust"), or a derivative application of Filetrust, (whether such
sales are made directly by the Company, through Fleet, or otherwise, and
including without limitation, those sales made pursuant to the
Commissioned Reseller and Co-Marketing Agreement (the "Co-Marketing
Agreement"), dated as of February 11, 2002, by and between the Company
and Fleet National Bank), provided however, that no amounts paid by
Fleet National Bank to the Company pursuant to the Service Level
Agreement, dated as of February 11, between the Company and Fleet
National Bank shall be deemed to be Revenue for the purposes hereof. The
determination of the Revenue applicable hereto shall be made in
accordance with Section 4.3 of the Asset Purchase Agreement (the
"Purchase Agreement"), dated as of January 28, 2002, between the Company
and Fleet National Bank, and any disagreement regarding the
determination of such Revenue shall be resolved in accordance with the
provisions of the Purchase Agreement.
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(c) Upon surrender of Warrant certificates and payment of the Warrant
Price, the Company shall issue and cause to be delivered with all
reasonable dispatch to or upon the written order of the Warrantholder,
and in such name or names as such Warrantholder may designate, a
certificate or certificates for the number of full Shares so acquired
upon the exercise of the Warrant. Such certificate or certificates shall
be deemed to have been issued and any person so designated to be named
therein shall be deemed to have become a holder of record of such Shares
as of the date of surrender of the Warrants being exercised and payment
of the Warrant Price, notwithstanding that the certificate or
certificates representing such securities shall not actually have been
delivered or that the stock transfer books of the Company shall then be
closed. The Warrants shall be exercisable at the election of a
Warrantholder either in full or from time to time in part and, in the
event that a certificate evidencing Warrants is exercised in respect of
fewer than all of the Shares specified therein at any time prior to the
applicable Termination Date, a new certificate evidencing the remaining
portion of the Warrants shall be issued by the Company.
Section 4. Payment of Taxes. The Company will pay all taxes and fees, if any,
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attributable to the initial issuance of the Warrants or the issuance of the
Shares upon exercise of the Warrants, except that the Company shall not be
required to pay any tax or fee which may be payable in respect of any secondary
transfer of the Warrants or such Shares.
Section 5. Mutilated or Missing Warrants. In case the certificate or
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certificates evidencing any Warrants shall be mutilated, lost, stolen or
destroyed, the Company shall, at the request of the affected Warrantholder,
issue and deliver in exchange and substitution for and upon cancellation of the
mutilated certificate or certificates, or in lieu of and substitution for the
certificate or certificates lost, stolen or destroyed, a new Warrant certificate
or certificates of like tenor and representing an equivalent right or interest,
but only upon receipt of evidence satisfactory to the Company of the loss, theft
or destruction of such Warrant and, if requested, at the cost and expense of the
Warrantholder, a bond of indemnity in form and amount satisfactory to the
Company. Applicants for such substitute Warrant certificates shall also comply
with such other reasonable requirements as the Company may prescribe.
Section 6. Reservation of Shares. There has been reserved, and the Company shall
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at all times keep reserved so long as any Warrants remain outstanding, out of
its authorized capital stock, such number of shares of Common Stock as shall be
subject to purchase under all outstanding Warrants.
Section 7. Adjustment of Number and Kind of Securities. The Warrant Price and
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the number and kind of securities purchasable upon the exercise of the Warrants
shall be subject to adjustment from time to time upon the happening of certain
events, as follows:
7.1 Adjustments. In case the Company shall (i) pay a dividend in Common
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Stock or make a distribution in Common Stock, (ii) subdivide its
outstanding Common Stock, (iii) combine its outstanding Common Stock
into a smaller number of shares of Common Stock, or (iv) issue, by
reclassification of its Common Stock, other securities of the Company,
then the number of shares of Common Stock or other securities
purchasable upon exercise of the Warrants immediately prior thereto
shall be adjusted so that each Warrantholder shall be entitled to
receive the kind and number of shares of Common Stock or other
securities of the Company which it would have owned or would have been
entitled to receive immediately after the happening of any of the events
described above, had the Warrants been exercised immediately prior to
the happening of such event or any Record Date (as defined below) with
respect thereto. In respect of the foregoing, the Warrant Price shall
forthwith be proportionately decreased in the case of a subdivision or
stock dividend, or proportionately increased in the case of a
combination. For purposes hereof, "Record Date" shall mean the date of
closing the transfer books of the Company for the determination of the
shareholders entitled to any relevant dividend, distribution,
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subscription rights or other rights or for the determination of
shareholders entitled to vote on any proposed merger, dissolution,
liquidation or winding up of the Company. Any adjustment made pursuant
to this subsection 7.1 shall become effective immediately on the
effective date of such event retroactive to the Record Date, if any, for
such event.
7.2 No Adjustment for Dividends. Except as provided in subsection 7.1,
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no adjustment to the Warrants or any provision or condition thereof in
respect of any dividends or distributions out of earnings of the Company
shall be made during the term of the Warrants or upon the exercise of
Warrants.
7.3 No Adjustment in Certain Cases. No adjustment shall be made pursuant
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to this Section 7 in connection with the grant or exercise of options to
purchase Common Stock under any of the Company's employee benefit plans.
7.4 Preservation of Purchase Rights upon Merger, Consolidation, etc. In
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case of any consolidation of the Company with or merger of the Company
into another entity or in case of any sale or conveyance to another
entity of the property, assets or business of the Company as an entirety
or substantially as an entirety, the Company or such successor or
purchasing entity, as the case may be, shall execute with the
Warrantholder an agreement that the Warrantholder shall have the right
thereafter, upon exercise of the Warrants and payment of the Warrant
Price in effect immediately prior to such consolidation, merger or sale,
to purchase the kind and amount of shares and other securities and
property which it would have been entitled to receive after the
happening of such consolidation, merger, sale or conveyance had the
Warrants been exercised immediately prior thereto. In the event of a
merger described in Section 368(a)(2)(E) of the Internal Revenue Code of
1986 (or any successor provision), in which the Company is the surviving
corporation, the right to purchase Shares under the Warrants shall
terminate on the date of such merger and thereupon the Warrants shall
become null and void, but only if the controlling corporation (after
such event) shall agree to substitute for the Warrants its warrants
entitling the holder thereof to purchase the kind and amount of shares
and other securities and property which it would have been entitled to
receive had the Warrants been exercised immediately prior to such
merger. Any such agreements referred to in this subsection 7.4 shall
provide for adjustments, which shall be as nearly equivalent as may be
practicable to the adjustments provided for in Section 7 hereof, and
shall contain substantially the same terms, conditions and provisions as
are contained herein immediately prior to such event. The provisions of
this subsection 7.4 shall similarly apply to successive consolidations,
mergers, sales or conveyances.
7.5 Nominal Value of Common Stock. Before taking any action which would
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cause an adjustment effectively reducing the portion of the Warrant
Price allocable to each share of Common Stock below the then nominal
value per share of Common Stock issuable upon exercise of the Warrants,
the Company will take any corporate action which may, in the opinion of
its counsel, be necessary in order that the Company may validly and
legally issue fully-paid and nonassessable Shares upon exercise of the
Warrants.
7.6 Independent Public Accountants. The Company may retain a firm of
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independent public accountants (which may be any such firm regularly
employed by the Company) to make any computation required hereunder, and
a certificate signed by such firm shall be evidence of the correctness
of any computation made hereunder.
7.7 Statement on Warrant Certificates. Irrespective of any adjustments
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in the number of securities issuable upon exercise of the Warrants,
Warrant certificates theretofore or thereafter issued may continue to
express the same number of securities as are stated in the similar
Warrant
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certificates initially issuable pursuant to this Agreement. However,
the Company may, at any time in its reasonable discretion, make any
change in the form of the Warrant certificate that it may deem
appropriate and that does not affect the substance thereof, and any
Warrant certificate hereafter issued, whether upon registration of
transfer of, or in exchange or substitution for, an outstanding Warrant
certificate, may be in the form so changed.
Section 8. Fractional Interests. The Company shall not be required to issue
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fractional Shares upon the exercise of any Warrant. If any fraction of a Share
would, except for the provisions of this Section 8, be issuable on the exercise
of any Warrant (or specified portion thereof), the Company shall pay an amount
in cash equal to the closing price of the Common Stock on the principal
securities exchange or automated quotation system on which the Common Stock is
then listed or traded for the 5 consecutive trading days immediately preceding
the date the certificates evidencing the Warrants to be exercised are received
by the Company at its principal office multiplied by such fraction.
Section 9. No Rights as Shareholder; Notices to Warrantholder. Nothing contained
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in this Agreement or in the Warrants shall be construed as conferring upon the
Warrantholder or any transferee of any rights as a shareholder of the Company,
including, without limitation, the right to vote, receive dividends, consent or
receive notices as a shareholder in respect of any meeting of shareholders for
the election of directors of the Company. If, however, at any time prior to the
expiration of the Warrants and prior to their exercise in full, any one or more
of the following events shall occur: (a) any action which would require an
adjustment pursuant to Section 7.1 or 7.4; or (b) a dissolution, liquidation or
winding up of the Company (other than in connection with a consolidation, merger
or sale of its property, assets and business as an entirety or substantially as
an entirety) shall be proposed, then the Company shall give notice in writing of
such event to the Warrantholder, as provided herein, at least 10 calendar days
prior to the date fixed as the Record Date. Such notice shall specify such
Record Date. Failure to mail or receive such notice or any defect therein shall
not affect the validity of any action taken with respect thereto.
Section 10. Restrictions on Transfer. The Warrantholder agrees and undertakes
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that if the Warrantholder proposes to sell or otherwise transfer any Warrants or
Shares issuable upon exercise thereof, and if such Shares are not then
registered for resale pursuant to an effective registration statement under the
Securities Act, the Warrantholder proposing to make such transfer shall give
written notice to the Company describing briefly the manner in which any such
proposed transfer is to be made and no such transfer shall be made unless the
Company shall have received an opinion of counsel for the Warrantholder
reasonably acceptable to the Company, that registration under the Securities Act
is not required with respect to such transfer.
Section 11. Registration Rights.
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11.1 Registration. If the Company at any time proposes to register any
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of its Common Stock under the Securities Act for sale to the public,
whether for its own account or for the account of other securityholders
or both (except with respect to registration statements on Forms S-4,
S-8 or another form not available for registering the Shares for sale
to the public), the Company will use commercially reasonable efforts to
cause the Shares issuable in respect of the Warrants then outstanding
to be included in the securities to be covered by the registration
statement proposed to be filed by the Company (the "Registration
Statement"), all to the extent requisite to permit the sale or other
disposition by the holder of such Shares so registered. In the event
that any registration pursuant to this Agreement shall be, in whole or
in part, an underwritten public offering of Common Stock, the number of
Shares to be included in such an underwriting may be reduced (pro rata
among the holders of Common Stock that shall have the right to have
Common Stock included in such Registration Statement) if and to the
extent that the managing underwriter shall be of the opinion that such
inclusion would adversely affect the marketing of the securities
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to be sold by the Company or the selling securityholders therein. The
Company shall not be required to include the Shares of any holder
unless the holder accepts in advance such terms of the underwriting as
may be agreed upon by the Company and the managing underwriter,
including, without limitation, any "lock-up" and indemnification
provisions. The holder shall comply with such other requirements as may
be imposed by the managing underwriter to effect an orderly
distribution of the Shares. Notwithstanding the foregoing provisions,
the Company may withdraw any Registration Statement without thereby
incurring any liability to the holders of Shares.
11.2 Indemnification and Contribution.
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(a) For purposes hereof: (i) the term "Selling Shareholder"
shall mean any person or entity selling Common Stock pursuant
to the Registration Statement, and any affiliate thereof; (ii)
the term "Registration Statement shall include any preliminary
prospectus, final prospectus, exhibit, supplement or amendment
included in or relating to the Registration Statement; and
(iii) the term "untrue statement" shall mean any untrue
statement or alleged untrue statement of a material fact in
the Registration Statement, or any omission or alleged
omission to state in the Registration Statement a material
fact required to be stated therein or necessary to make the
statement therein, in the light of the circumstances under
which they were made, not misleading.
(b) The Company agrees to indemnify and hold harmless each
Selling Shareholder from and against any losses, claims,
damages or liabilities to which such Selling Shareholder 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, or arise out of any failure by the
Company to fulfill any undertaking included herein or in the
Registration Statement, and the Company promptly will
reimburse such Selling Shareholder for any legal or other
expenses reasonably incurred in investigating, defending or
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, an untrue statement
made in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such
Selling Shareholder specifically for use in preparation of the
Registration Statement, or the failure of such Selling
Shareholder to comply with the covenants and agreements
contained herein; provided further, that the indemnification
contained herein with respect to any prospectus after it has
been amended or supplemented, shall not inure to the benefit
of any Selling Shareholder (or any person controlling such
Selling Shareholder) from whom the person asserting such loss,
claim, damage, or liability shall have purchased Common Stock,
that are the subject thereof if, after copies thereof have
been delivered by the Company to such Selling Shareholder,
such Selling Shareholder shall have failed to send or give a
copy of the prospectus as then amended or supplemented, as the
case may be, to such person at or prior to the confirmation of
such sale of such Common Stock, to such person and, if such
loss, claim, damage or liability would not have arisen but for
the failure of such Selling Shareholder to deliver the same.
(c) The Warrrantholder agrees to indemnify and hold harmless
the Company (and each other person, if any, who controls the
Company within the meaning of Section 15 of the Securities
Act, each officer of the Company who signs the Registration
Statement and each director of the Company) from and against
any losses, claims, damages or liabilities to which the
Company (or any such officer, director or controlling person)
may become
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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 failure of the Warrantholder to comply with its
covenants and agreements contained herein, or any untrue
statement if such untrue statement was made in reliance upon
and in conformity with written information furnished by or on
behalf of the Warrantholder specifically for use in
preparation of the Registration Statement, and the
Warrantholder promptly will reimburse the Company (or such
officer, director or controlling person), as the case may be,
for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such
action, proceeding or claim; provided, however, that the
Warrantholder shall not be liable for any amounts in excess of
the net proceeds it receives upon the sale of the Shares.
(d) 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
hereunder, 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 such indemnifying person
shall have been notified thereof, such indemnifying person
shall be entitled to participate therein and, to the extent it
shall wish, to assure the defense thereof, with counsel
reasonably satisfactory to such indemnified person. After
notice from the indemnifying person to such indemnified person
of its election to assume the defense thereof, such
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. In
the event that the indemnifying party shall have assumed the
defense of such action, such indemnifying party shall not
enter into any compromise or settlement without the
indemnified party's prior written consent, which consent shall
not be unreasonably withheld, delayed or denied.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for
hereunder is due in accordance with its terms but for any
reason is held to be unavailable or insufficient to hold
harmless an indemnified party, the Company on the one hand and
the Warrantholder on the other hand shall, in lieu of
indemnifying such indemnified party, contribute to the
aggregate losses, claims, damages or liabilities referred to
herein (including costs of any investigation and legal and
other expenses reasonable incurred in connection therewith,
and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted), in such proportions as is
appropriate to reflect the relative benefits received by the
Company and the Warrantholder from any offering of Common
Stock and the relative fault of the Company and the
Warrantholder in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable
considerations. The relative fault of the Company and the
Warrantholder shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact or omission related to information supplied by
the Company (including for this purpose information supplied
by any officer, director, employee or agent of the Company) or
to written information supplied by any officer, director,
employee or agent of the Company) or to written information
furnished to the Company by or on behalf of the Warrantholder
specifically for use in the preparation of the Registration
Statement or any amendment thereof or supplement thereto, and
the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or
omission. Notwithstanding the provisions hereof, in no case
shall the
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Warrantholder be liable or responsible for any amount in
excess of the proceeds received by the Warrantholder from the
sale of the Shares included in the Registration Statement,
provided, however, that 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. For purposes hereof, each person, if any,
who controls the Warrantholder within the meaning of Section
15 of the Securities Act or Section 20(a) of the Securities
and Exchange Act of 1934, as amended (the "Exchange Act")
shall have the same rights to contribution as the
Warrantholder, and each person, if any, who controls the
Company within the meaning of the Section 15 of the Securities
Act or Section 20(a) of the Exchange Act, each director of the
Company and each officer of the Company who shall have signed
the Registration Statement shall have the same rights to
contribution as the Company, subject to the immediately
preceding sentence. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another
party or parties hereunder, notify such party or parties from
whom contribution may be sought, and the omission so to notify
such party or parties from whom contribution may be sought
shall relieve the party or parties from whom contribution may
be sought (if such party was unaware of such action, suit, or
proceeding and was materially prejudiced by such omission)
from any liability hereunder, but not from any other
obligation it or they may have hereunder or other than under
this Section 11.2. No party shall be liable for contribution
with respect to the settlement of any action, suit, proceeding
or claim effected without its written consent. The obligations
of the Warrantholder to contribute pursuant to this Section
11.2 are several and not joint in proportion to its respective
number of Shares included in the Registration Statement.
11.3 Prospectus Delivery Requirements. The Warrantholder agrees not to
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make any sale of the Shares pursuant to the Registration Statement
without effectively causing the prospectus delivery requirements under
the Securities Act to be satisfied. The Warrantholder acknowledges that
there may occasionally be times when the Company must suspend the use
of the prospectus forming a part of the Registration Statement until
such time as an amendment to such Registration Statement has been filed
by the Company and declared effective by the Commission or until the
Company has amended or supplemented such prospectus. In the event that
the Registration Statement has been suspended, the Company shall
provide written notice of such suspension to the Selling Shareholder.
In the event that such Registration Statement is no longer subject to
such suspension, the Company shall provide written notice to such
Selling Shareholder that such Selling Shareholder may thereafter effect
sales pursuant to such Registration Statement.
Section 12. Severability. The parties hereto intend that each section of this
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Agreement should be viewed as separate and divisible, and in the event that any
section, provision, agreement or condition of this Agreement shall be held to be
invalid, void, or unenforceable, such section, provision, covenant or condition
shall be enforced to the maximum extent permitted under applicable law and the
remainder of the provisions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 13. Governing Law; Jurisdiction; Venue. This Agreement and the
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performance hereunder shall be governed by, and construed in accordance with,
the laws of the State of New York, without giving effect to such State's rules
governing the conflicts of laws. In addition, each of the parties hereto
irrevocably consents to the exclusive jurisdiction of the courts of the State of
New York County of New York, and of any federal court located in the State of
New York, County of New York, in connection with any action
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or proceeding arising out of or relating to, or a breach of, this Agreement, or
any document or instrument delivered in connection with this Agreement.
Section 14. Amendments. This Agreement may only be modified or amended by an
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instrument in writing signed by the Company and the Warrantholder.
Section 15. Notices. All notices, claims, requests, demands and other
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communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered or if sent by a nationally-recognized
overnight courier, by facsimile, or by registered or certified mail, return
receipt requested and postage prepaid, addressed as follows:
if to the Company:
MangoSoft, Inc.
1500 West Park Drive, Suite 190
Westborough, Massachusetts 01581
Facsimile No.: (508) 871-7380
Attention: President;
if to Warrantholder, to the address set forth on the signature page
hereto;
or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. Any such notice
or communication shall be deemed to have been received (a) in the case of
personal delivery, on the date of such delivery, (b) in the case of a
nationally-recognized overnight courier, on the next business day after the date
when sent, (c) in the case of facsimile, when received, and (d) in the case of
mailing, on the third business day following that on which the piece of mail
containing such communication is posted.
Section 16. Headings and Pronouns. The headings of the sections of this
---------------------------------
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of names and pronouns shall include the
plural and vice versa.
Section 17. Entire Agreement. This Agreement and the applicable provisions of
----------------------------
the Purchase Agreement and the Co-Marketing Agreement constitute the entire
agreement between the parties hereto pertaining to the subject matter contained
herein and supersedes any and all other prior or contemporaneous agreements,
arrangements, and understandings, either oral or in writing, between the parties
hereto with respect to the subject matter hereof. Each party to this Agreement
acknowledges and represents that no representations, warranties, covenants,
conditions, inducement, promises or agreements, oral or otherwise, other than as
set forth herein, have been made by either party hereto, or anyone acting on
behalf of either party.
Section 18. Counterparts. This Agreement may be executed in any number of
------------------------
counterparts, and each such counterpart shall be deemed to be an original
instrument, but all such counterparts together shall constitute one agreement.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Warrant Agreement
as of the date specified below.
MANGOSOFT, INC.
Date: February 11, 2002 By: /s/ Robert E. Parsons
Title: Vice President and Chief
Financial Officer
FLEET NATIONAL BANK
By: /s/ Blaise Heltai
Title: Executive Vice President
Warrantholder's address for notices:
100 Federal Street
Global Internet Strategy
MA/DE?10023C
Boston, MA 02110
Facsimile No.: 617-434-8901
Attention: Matthew L. Lehman
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[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE, AND THE COMMON STOCK
ISSUABLE UPON EXERCISE OF SUCH WARRANTS, HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. SUCH WARRANTS MAY NOT BE SOLD, ASSIGNED,
EXCHANGED OR OTHERWISE TRANSFERRED IN ANY MANNER AND SUCH COMMON STOCK
MAY NOT BE OFFERED FOR SALE, SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT
AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
Warrant Certificate No._____
MANGOSOFT, INC.
WARRANTS TO PURCHASE COMMON STOCK
This certifies that, for value received, ______________________ (the
"Warrantholder") is the registered owner of _________ warrants (the "Warrants"),
each Warrant representing the right to purchase from MangoSoft, Inc. (the
"Company"), at any time prior to 5:00 p.m., Eastern Time, on
_____________________ (the "Termination Date"), one share of common stock of the
Company, par value $0.001 per share (the "Common Stock") at an initial purchase
price of U.S. $_______ per share of Common Stock (the "Warrant Price"). The
Warrants are subject to, and each Warrantholder, by acceptance of this
certificate consents to, all the terms and provisions of the Warrant Agreement
by and between the Company and the Warrantholder, dated as of [_____], 2002 (the
"Warrant Agreement"), pursuant to which the Warrants were issued. Any
capitalized terms used herein and not defined herein shall have the meanings
assigned to such terms in the Warrant Agreement.
The Warrants evidenced hereby may be exercised in whole or in part by
presentation of this Warrant Certificate with the attached Purchase Form duly
executed, and simultaneous payment of the Warrant Price for each Warrant
exercised, at the principal office of the Company. Payment of the Warrant Price
shall be made at the option of each Warrantholder in cash or by certified or
cashier's check.
Upon any partial exercise of the Warrants evidenced hereby, there shall be
executed and issued to the Warrantholder effecting such partial exercise a new
Warrant Certificate in respect of the Common Stock as to which the Warrants
evidenced hereby shall not have been exercised. These Warrants may be exchanged
at the office of the Company by surrender of this Warrant Certificate properly
endorsed for one or more new Warrants of the same aggregate number of shares of
Common Stock as here evidenced by the Warrant or Warrants exchanged. No
fractional shares of Common Stock will be issued upon the exercise of rights to
purchase hereunder, but the Company shall pay the cash value of any fraction
upon the exercise of one or more Warrants. These Warrants are transferable at
the office of the Company in the manner and subject to the limitations set forth
in the Warrant Agreement.
This Warrant Certificate does not entitle any Warrantholder to any of the
rights of a shareholder of the Company.
[Signature page follows]
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IN WITNESS WHEREOF, the undersigned has executed this instrument as of the
date specified below.
MANGOSOFT, INC.
Dated:______________________ By:
Print name:
Title:
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PURCHASE FORM
MangoSoft, Inc.
1500 West Park Drive, Suite 190
Westborough, Massachusetts 01581
Facsimile No.: (508) 871-7380
Attention: President
Pursuant to Section 3 of the Warrant Agreement, the undersigned hereby
irrevocably elects to exercise the right of purchase represented by this Warrant
Certificate for, and to purchase thereunder, ___________________________ shares
of Common Stock provided for therein, and requests that certificates for such
Common Stock be issued in the name of:
Print name:_____________________________________
Address:________________________________________
________________________________________________
Taxpayer Identification Number:_________________
If this Warrant Certificate is hereby being exercised with respect to fewer
than all the shares of Common Stock specified herein, please issue a new Warrant
Certificate for the unexercised balance of the Warrants, registered in the name
of the undersigned Warrantholder or his assignee as below indicated and
delivered to the address stated below.
Name of Warrantholder(s)
or assignee(s) (Please print):________________________________
Address:______________________________________
______________________________________________
Dated:____________________________
If entity, print name online below: Individual
_____________________________________ By:__________________________
Print name:
By:
Print name:
Title:
Note: The above signature block must correspond exactly with the name as set
forth on the face of this Warrant Certificate.
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<PAGE>
ASSIGNMENT FORM
MangoSoft, Inc.
1500 West Park Drive, Suite 190
Westborough, Massachusetts 01581
Facsimile No.: (508) 871-7380
Attention: President
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:
Print name:__________________________________
Address:_____________________________________
_____________________________________________
Taxpayer Identification Number:______________
the within Warrants, hereby irrevocably constituting and appointing
_______________________ the undersigned's attorney-in-fact to transfer said
Warrants on the books of the Company, with full power of substitution.
If entity, print name online below:
Individual
__________________________________ By:______________________________
Print name:
By:
Print name:
Title:
Note: The above signature block must correspond exactly with the name as set
forth on the face of this Warrant Certificate.
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