Exhibit 10.1

 

CONSENT AND AMENDMENT AGREEMENT

 

This Consent and Amendment Agreement, dated March 14, 2004, is made by BayStar
Capital II, L.P. (“BayStar”) in its capacity as the sole holder of all of the
outstanding shares of Series B Preferred Stock, par value $0.0001 per share (the
“Series B Shares”), of Commerce One, Inc. (the “Company”), and by and between
BayStar and the Company in their capacities as parties to the Securities
Purchase Agreement, dated July 10, 2003 (the “Securities Purchase Agreement”),
the Registration Rights Agreement, dated July 10, 2003 (the “Registration Rights
Agreement”) and related warrants (the “Warrants”)(collectively, the “Financing
Agreements”).

 

WHEREAS:

 

A.            The Company and BayStar desire to amend certain provisions of the
Registration Rights Agreement to provide the Company with ninety (90) additional
days before BayStar can demand that the Company redeem the Series B Shares for
the failure of the Company to have the BayStar Registration Statement (as
defined below) declared effective by the Securities and Exchange Commission.

 

B.            The Company and BayStar desire to amend the Registration Delay
Payments provisions provided for in the Registration Rights Agreement and settle
on compensation for all accrued penalties.

 

1.             BAYSTAR, IN ITS CAPACITY AS BOTH THE SOLE HOLDER OF ALL OF THE
OUTSTANDING SERIES B SHARES AND AS A PARTY TO THE FINANCING AGREEMENTS, TOGETHER
WITH THE COMPANY, HEREBY AGREE AND CONSENT TO THE AMENDMENT OF:

 

(A)           SECTION 2A OF THE REGISTRATION RIGHTS AGREEMENT BY SUBSTITUTING
THE FOLLOWING FOR THE LAST SENTENCE OF SUCH SECTION:

 

“THE COMPANY SHALL USE ITS REASONABLE BEST EFFORTS TO HAVE THE REGISTRATION
STATEMENT DECLARED EFFECTIVE ON OR BEFORE APRIL 5, 2004 (THE “EFFECTIVENESS
DEADLINE”) OR, IF SOONER, AS SOON AS PRACTICABLE.  FOR THE AVOIDANCE OF DOUBT,
THE LACK OF EFFECTIVENESS OF THE REGISTRATION STATEMENT PRIOR TO OR ON JULY 4,
2004 SHALL NOT CONSTITUTE A LAPSE OR UNAVAILABILITY OF THE REGISTRATION
STATEMENT FOR PURPOSES OF SECTION 3(B)(II) OF THE CERTIFICATE OF DESIGNATIONS.”
AND

 

(B)           SECTION 3A OF THE REGISTRATION RIGHTS AGREEMENT BY SUBSTITUTING
THE FOLLOWING FOR THE FIRST SENTENCE OF SUCH SECTION:

 

“THE COMPANY SHALL PROMPTLY PREPARE AND FILE WITH THE SEC A REGISTRATION
STATEMENT WITH RESPECT TO THE REGISTRABLE SECURITIES (BUT IN NO EVENT LATER THAN
THE APPLICABLE FILING DEADLINE) AND USE ITS REASONABLE BEST EFFORTS TO HAVE THE
REGISTRATION STATEMENT RELATING TO THE REGISTRABLE SECURITIES DECLARED EFFECTIVE
ON OR BEFORE THE EFFECTIVENESS DEADLINE OR, IF SOONER, AS SOON AS PRACTICABLE. 
FOR THE AVOIDANCE OF DOUBT, THE LACK OF EFFECTIVENESS OF THE REGISTRATION
STATEMENT PRIOR TO OR ON JULY 4, 2004 SHALL NOT CONSTITUTE A LAPSE OR
UNAVAILABILITY OF THE REGISTRATION STATEMENT FOR PURPOSES OF SECTION 3(B)(II) OF
THE CERTIFICATE OF DESIGNATIONS.”

 

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2.             BAYSTAR, IN ITS CAPACITY AS A PARTY TO THE FINANCING AGREEMENTS,
HEREBY WAIVES ITS RIGHT TO RECEIVE REGISTRATION DELAY PAYMENTS AS CONTEMPLATED
IN SECTION 2F OF THE REGISTRATION RIGHTS AGREEMENT, AND ANY INTEREST OR
PENALTIES THEREON, WHETHER ACCRUED NOW OR ACCRUING IN THE FUTURE, WITH RESPECT
TO THE FAILURE OF THE REGISTRATION STATEMENT ON FORM S-3 (FILE NO.
333-108144)(THE “BAYSTAR REGISTRATION STATEMENT”) TO BE EFFECTIVE AT ANY TIME ON
OR BEFORE JULY 4, 2004.

 

3.             IN CONSIDERATION OF BAYSTAR’S CONSENT AND AGREEMENTS HEREUNDER,
THE COMPANY HEREBY AGREES TO PAY $200,000 (THE “CASH PAYMENT”) TO BAYSTAR AND TO
ISSUE TO BAYSTAR SHARES OF ITS COMMON STOCK, $.0001 PAR VALUE PER SHARE, HAVING
AN AGGREGATE FAIR MARKET VALUE OF $947,000 (THE “COMMON SHARES”).  THE COMPANY
SHALL MAKE THE CASH PAYMENT TO BAYSTAR BY WIRE TRANSFER ON OR BEFORE APRIL 1,
2004.  IN THE EVENT THAT THE CASH PAYMENT IS NOT PAID IN FULL ON OR BEFORE THE
APRIL 1, 2004, SIMPLE INTEREST SHALL ACCRUE ON THE UNPAID PORTION OF THE CASH
PAYMENT AT THE MAXIMUM RATE PERMITTED BY APPLICABLE LAW (BUT IN NO EVENT MORE
THAN 25% PER DAY).  IN THE EVENT THAT THE CASH PAYMENT IS NOT PAID IN FULL ON OR
PRIOR TO APRIL 5, 2004, THIS CONSENT AND AMENDMENT AGREEMENT SHALL BE NULL AND
VOID AND HAVE NO FURTHER FORCE AND EFFECT (FOR PURPOSES OF CLARIFICATION, THE
AMENDMENTS AS CONTEMPLATED HEREIN TO THE REGISTRATION RIGHTS AGREEMENT SHALL NOT
BE EFFECTIVE) AND THE ISSUANCE OF THE COMMON SHARES SHALL BE DEEMED TO BE A
PENALTY AND BAYSTAR SHALL NOT HAVE ANY OBLIGATION TO RETURN SUCH COMMON SHARES. 
THE FAIR MARKET VALUE OF THE COMMON SHARES SHALL BE DETERMINED BASED ON THE
AVERAGE OF THE CLOSING BID PRICES OF THE COMPANY’S COMMON STOCK ON THE NASDAQ
NATIONAL MARKET FOR THE FIVE TRADING DAYS IMMEDIATELY PRECEDING THE DATE OF THIS
CONSENT AND AMENDMENT AGREEMENT.  THE ISSUANCE OF THE COMMON SHARES, AND THE
DELIVERY OF THE CERTIFICATES REPRESENTING THE COMMON SHARES SHALL TAKE PLACE AT
A TIME AND PLACE TO BE MUTUALLY AGREED BY THE PARTIES, BUT IN NO EVENT LATER
THAN FIVE (5) BUSINESS DAYS FOLLOWING THE DATE HEREOF.

 

4.             OTHER THAN AS SET FORTH IN THE SEC DOCUMENTS (AS DEFINED BELOW),
THE COMPANY REPRESENTS AND WARRANTS TO BAYSTAR THAT (FOR THE PURPOSES OF THIS
SECTION 4, “KNOWLEDGE” OF THE COMPANY SHALL MEAN THE ACTUAL KNOWLEDGE OF THE
OFFICERS OF THE COMPANY):

 

(A)           ORGANIZATION AND QUALIFICATION.  THE COMPANY AND ITS
“SUBSIDIARIES” (WHICH FOR PURPOSES OF THIS CONSENT AND AMENDMENT AGREEMENT MEANS
ANY ENTITY IN WHICH THE COMPANY, DIRECTLY OR INDIRECTLY, OWNS MORE THAN 50% OF
THE CAPITAL STOCK OR HOLDS A MORE THAN 50% EQUITY OR SIMILAR INTEREST) ARE
ENTITIES DULY ORGANIZED AND VALIDLY EXISTING IN GOOD STANDING UNDER THE LAWS OF
THE JURISDICTION IN WHICH THEY ARE ORGANIZED, AND HAVE THE REQUISITE CORPORATE
OR OTHER POWER AND AUTHORIZATION TO OWN THEIR PROPERTIES AND TO CARRY ON THEIR
BUSINESS AS NOW BEING CONDUCTED.  EACH OF THE COMPANY AND ITS SUBSIDIARIES IS
DULY QUALIFIED AS A FOREIGN ENTITY TO DO BUSINESS AND IS IN GOOD STANDING IN
EVERY JURISDICTION IN WHICH ITS OWNERSHIP OF PROPERTY OR THE NATURE OF THE
BUSINESS CONDUCTED BY IT MAKES SUCH QUALIFICATION NECESSARY, EXCEPT TO THE
EXTENT THAT THE FAILURE TO BE SO QUALIFIED OR BE IN GOOD STANDING WOULD NOT
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.  AS USED IN THIS
CONSENT AND AMENDMENT AGREEMENT, “MATERIAL ADVERSE EFFECT” MEANS ANY MATERIAL
ADVERSE EFFECT ON THE BUSINESS, PROPERTIES, ASSETS, OPERATIONS, RESULTS OF
OPERATIONS OR CONDITION (FINANCIAL OR OTHERWISE) OF THE COMPANY AND ITS
SUBSIDIARIES, TAKEN AS A WHOLE, OR ON THE TRANSACTIONS CONTEMPLATED HEREBY OR BY
THE AGREEMENTS AND INSTRUMENTS TO BE ENTERED INTO IN CONNECTION

 

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HEREWITH, OR ON THE AUTHORITY OR ABILITY OF THE COMPANY TO PERFORM ITS
OBLIGATIONS UNDER THIS CONSENT AND AMENDMENT AGREEMENT.

 

(B)           AUTHORIZATION; ENFORCEMENT; VALIDITY.  THE COMPANY HAS THE
REQUISITE CORPORATE POWER AND AUTHORITY TO ENTER INTO AND PERFORM ITS
OBLIGATIONS UNDER THIS CONSENT AND AMENDMENT AGREEMENT AND TO ISSUE THE COMMON
SHARES IN ACCORDANCE WITH THE TERMS HEREOF.  THE EXECUTION AND DELIVERY OF THE
CONSENT AND AMENDMENT AGREEMENT BY THE COMPANY AND THE CONSUMMATION BY THE
COMPANY OF THE TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING, WITHOUT LIMITATION,
THE ISSUANCE OF THE COMMON SHARES AND THE CASH PAYMENT, HAVE BEEN DULY
AUTHORIZED BY THE COMPANY’S BOARD OF DIRECTORS AND NO FURTHER CONSENT OR
AUTHORIZATION IS REQUIRED BY THE COMPANY, ITS BOARD OF DIRECTORS OR ITS
STOCKHOLDERS.  THIS CONSENT AND AMENDMENT AGREEMENT HAS BEEN DULY EXECUTED AND
DELIVERED BY THE COMPANY, AND CONSTITUTES A LEGAL, VALID AND BINDING OBLIGATION
OF THE COMPANY ENFORCEABLE AGAINST THE COMPANY IN ACCORDANCE WITH ITS TERMS,
EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY GENERAL PRINCIPLES OF EQUITY OR
APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, MORATORIUM, LIQUIDATION OR
SIMILAR LAWS RELATING TO, OR AFFECTING GENERALLY, THE ENFORCEMENT OF APPLICABLE
CREDITORS’ RIGHTS AND REMEDIES.

 

(C)           ISSUANCE OF COMMON SHARES.  THE COMMON SHARES ARE DULY AUTHORIZED
AND, UPON ISSUANCE IN ACCORDANCE WITH THE TERMS HEREOF, SHALL BE VALIDLY ISSUED,
FREE FROM ALL DOCUMENTARY STAMP, TRANSFER OR SIMILAR TAXES (PROVIDED THAT SUCH
TAXES SHALL BE LIMITED TO UNITED STATES FEDERAL TAXES, STATE TAXES AND TAXES OF
THE JURISDICTION OF INCORPORATION OF THE COMPANY), LIENS AND CHARGES WITH
RESPECT TO THE ISSUE THEREOF (OTHER THAN RESTRICTIONS ON TRANSFER UNDER FEDERAL
AND STATE SECURITIES LAWS AND OTHER AGREEMENTS BETWEEN THE COMPANY AND
BAYSTAR).  ASSUMING THE ACCURACY OF EACH OF THE REPRESENTATIONS AND WARRANTIES
OF BUYER CONTAINED IN SECTION 4, THE ISSUANCE BY THE COMPANY OF THE COMMON
SHARES IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ACT”).

 

(D)           NO CONFLICTS.  THE EXECUTION, DELIVERY AND PERFORMANCE OF THIS
CONSENT AND AMENDMENT AGREEMENT, BY THE COMPANY AND THE CONSUMMATION BY THE
COMPANY OF THE TRANSACTIONS CONTEMPLATED HEREBY (INCLUDING, WITHOUT LIMITATION,
THE ISSUANCE OF THE COMMON SHARES AND THE CASH PAYMENT) WILL NOT (I) RESULT IN A
VIOLATION OF THE CERTIFICATE OF INCORPORATION, ANY CERTIFICATE OF DESIGNATIONS,
PREFERENCES AND RIGHTS OF ANY OUTSTANDING SERIES OF PREFERRED STOCK OR BYLAWS OF
THE COMPANY OR ANY SUBSIDIARY, (II) CONFLICT WITH, OR CONSTITUTE A DEFAULT (OR
AN EVENT WHICH WITH NOTICE OR LAPSE OF TIME OR BOTH WOULD BECOME A DEFAULT)
UNDER, OR GIVE TO OTHERS ANY RIGHTS OF TERMINATION, AMENDMENT, ACCELERATION OR
CANCELLATION OF, ANY MATERIAL AGREEMENT, INDENTURE OR INSTRUMENT TO WHICH THE
COMPANY OR ANY OF ITS SUBSIDIARIES IS A PARTY, OR (III) RESULT IN A VIOLATION OF
ANY LAW, RULE, REGULATION, ORDER, JUDGMENT OR DECREE (INCLUDING FEDERAL AND
STATE SECURITIES LAWS AND REGULATIONS AND THE RULES AND REGULATIONS OF THE
NASDAQ NATIONAL MARKET) APPLICABLE TO THE COMPANY OR ANY OF ITS SUBSIDIARIES OR
BY WHICH ANY PROPERTY OR ASSET OF THE COMPANY OR ANY OF ITS SUBSIDIARIES IS
BOUND OR AFFECTED.

 

(E)           CONSENTS.  ALL CONSENTS, AUTHORIZATIONS, ORDERS, FILINGS AND
REGISTRATIONS WHICH THE COMPANY IS REQUIRED TO OBTAIN TO EXECUTE, DELIVER OR
PERFORM ANY OF ITS OBLIGATIONS UNDER OR CONTEMPLATED BY THIS CONSENT AND
AMENDMENT AGREEMENT IN ACCORDANCE WITH ITS

 

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terms have been obtained or effected on or prior to the date hereof.  The
Company and its Subsidiaries are unaware of any facts or circumstances which
might reasonably be expected to prevent the Company from obtaining or effecting
any of the foregoing.  The Company is not to its knowledge in violation of the
listing requirements of the Nasdaq National Market and has no knowledge of any
facts which would reasonably lead to delisting or suspension of its Common Stock
in the foreseeable future.

 

(F)            NO MATERIAL MISSTATEMENTS OR OMISSIONS.  THE INFORMATION PROVIDED
BY THE COMPANY TO BAYSTAR IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY
THIS CONSENT AND AMENDMENT AGREEMENT, TOGETHER WITH THE COMPANY’S FORM 10-K FOR
THE YEAR ENDED DECEMBER 31, 2002, AND ALL SUBSEQUENT FILINGS BY THE COMPANY WITH
THE SECURITIES AND EXCHANGE COMMISSION (THE “SEC FILINGS”), DOES NOT CONTAIN ANY
UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY
TO MAKE SUCH INFORMATION, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH IT WAS
PROVIDED, NOT MISLEADING.

 

5.             BAYSTAR HEREBY REPRESENTS TO THE COMPANY THAT: (A) IT IS AN
“ACCREDITED” INVESTOR WITHIN THE MEANING OF THE ACT, (B) IT IS ACQUIRING THE
COMMON SHARES FOR INVESTMENT PURPOSES WITHOUT A VIEW TO A DISTRIBUTION THEROF IN
VIOLATION OF THE ACT, (C) IT HAS RECEIVED ALL INFORMATION THAT IT HAS REQUESTED
FROM THE COMPANY IN CONNECTION WITH THE TRANSACTIONS CONTEMPLATED BY THIS
CONSENT AND AMENDMENT AGREEMENT, (D) IT IS AWARE THAT THE COMMON SHARES ARE
SUBJECT TO RESTRICTIONS ON RESALE UNDER FEDERAL AND STATE SECURITIES LAWS AND
THE CERTIFICATE REPRESENTING SUCH SHARES WILL BEAR LEGENDS TO THAT EFFECT, (E)
IT UNDERSTANDS THAT THE COMPANY IS RELYING ON ITS REPRESENTATIONS AND WARRANTIES
CONTAINED HEREIN TO DETERMINE, IN PART, THE EXEMPTION FROM REGISTRATION FOR THE
TRANSACTIONS CONTEMPLATED BY THIS CONSENT AND AMENDMENT AGREEMENT, (F) THIS
CONSENT AND AMENDMENT AGREEMENT HAS BEEN DULY AND VALIDLY AUTHORIZED, EXECUTED
AND DELIVERED ON BEHALF OF BAYSTAR AND REPRESENTS THE LEGAL, VALID AND BINDING
OBLIGATION OF BAYSTAR, ENFORCEABLE AGAINST BAYSTAR IN ACCORDANCE WITH ITS TERMS,
EXCEPT AS SUCH ENFORCEABILITY MAY BE LIMITED BY GENERAL PRINCIPLES OF EQUITY OR
APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, MORATORIUM, LIQUIDATION AND
OTHER SIMILAR LAWS RELATING TO, OR AFFECTING GENERALLY, THE ENFORCEMENT OF
APPLICABLE CREDITORS’ RIGHTS AND REMEDIES, (G) THE EXECUTION, DELIVERY AND
PERFORMANCE OF CONSENT AND AMENDMENT AGREEMENT BY BAYSTAR AND THE CONSUMMATION
BY BAYSTAR OF THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY WILL NOT (I)
RESULT IN A VIOLATION OF THE CONSTITUENT DOCUMENTS OF BAYSTAR OR (II) CONFLICT
WITH, OR CONSTITUTE A DEFAULT (OR AN EVENT WHICH WITH NOTICE OR LAPSE OF TIME OR
BOTH WOULD BECOME A DEFAULT) UNDER, OR GIVE TO OTHERS ANY RIGHTS OF TERMINATION,
AMENDMENT, ACCELERATION OR CANCELLATION OF, ANY MATERIAL AGREEMENT, INDENTURE OR
INSTRUMENT TO WHICH BAYSTAR IS A PARTY, OR (III) RESULT IN A VIOLATION OF ANY
LAW, RULE, REGULATION, ORDER, JUDGMENT OR DECREE APPLICABLE TO BAYSTAR OR BY
WHICH ANY PROPERTY OR ASSET OF BAYSTAR IS BOUND OR AFFECTED, EXCEPT IN THE CASE
OF CLAUSES (II) AND (III), FOR SUCH BREACHES OR DEFAULTS AS WOULD NOT BE
REASONABLY EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON SUCH BAYSTAR ABILITY TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED HEREBY.

 

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6.             The following paragraphs of Section 9 of the Securities Purchase
Agreement shall be deemed to be separately contained in the Consent and
Amendment Agreement as if included herein in a manner applicable to this Consent
and Amendment Agreement: (a)(Governing Law; Jurisdiction; Jury Trial);
(b)(Counterparts);  (c)(Headings); (d)(Severability); (f)(Notices);
(g)(Successors and Assigns); (h)(No Third Party Beneficiaries); (j)(Further
Assurances); (k)(Indemnification); (l)(No Strict Construction); (m)(Remedies);
(n) Payment Set Aside) and (o)(Independent Nature of Buyer’s Obligations and
Rights).

 

IN WITNESS WHEREOF, Commerce One and BayStar each hereby execute this Consent
and Amendment Agreement on the date first appearing above.

 

Commerce One, Inc.

 

By:

/s/  Charles Boynton

 

 

 

 

Name:

Charles Boynton

 

 

 

 

Title:

CFO

 

 

 

 

BayStar Capital II, L.P.

 

By BayStar Capital Management, LLC,its
General Partner

 

 

 

By:

/s/  Steve Lamar

 

Name: Steve Lamar

Title: Managing Member

 

 

SIGNATURE PAGE TO CONSENT AND AMENDMENT AGREEMENT

 

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