Document:

Exhibit 10.44

 

ASSIGNMENT AND ASSUMPTION
OF MASTER LEASE,

PARTIAL TERMINATION OF MASTER LEASE AND

ASSIGNMENT AND ASSUMPTION OF SUBLEASES

 

THIS ASSIGNMENT AND
ASSUMPTION OF MASTER LEASE, PARTIAL TERMINATION OF MASTER LEASE AND ASSIGNMENT
AND ASSUMPTION OF SUBLEASES (“Agreement”) is dated as of this 7th
day of July 2004, by and between PACIFIC SHORES INVESTORS, LLC, a Delaware
limited liability company (“PSI”), and BROADVISION, INC., a Delaware
corporation (“BroadVision”).

 

R  E
C  I  T  A  L  S :

 

A.            PSI’s predecessor-in-interest,
Pacific Shores Center LLC, and BroadVision have previously entered into that
certain Triple Net Building Lease dated as of February 15, 2000, as amended by
that certain undated Memorandum of Commencement of Lease Term (referencing the
Commencement Date of the Lease of May 1, 2001), that certain Agreement to
Resolve Certain Tenant Improvement Disputes with Respect to B-4, B-5 & B-6
dated as of January 8, 2002, and that certain First Amendment to Lease
(Building 6 - 1600 Seaport Boulevard) dated as of May 9, 2002 (collectively,
the “Master Lease”), under which BroadVision leases from PSI certain premises
identified therein and commonly known as Building 6, Pacific Shores Center,
1600 Seaport Boulevard, Redwood City, California 94060 (the “Premises”).  A true and complete copy of the Master Lease
is attached to this Agreement as Exhibit A.  All capitalized terms used herein but not
otherwise defined herein shall have the meanings ascribed to them in the Master
Lease.

 

B.            BroadVision and
Symantec Corporation, a Delaware corporation (“Symantec”), as
successor-in-interest to Recourse Technologies, Inc., a Delaware corporation,
are parties to that certain Sublease dated October 31, 2001, as amended by that
certain Consent to Sublease dated November 29, 2001, that certain First
Amendment to Sublease dated as of October 14, 2002, that certain First
Amendment to Consent to Sublease dated as of November 25, 2002, that certain
letter dated January 24, 2003 re: First Amendment to Sublease Terms (Commencement
Date), that certain Second Amendment to Sublease dated as of October 20, 2003,
that certain Second Amendment to Consent to Sublease dated as of January 9,
2004, and that certain undated Commencement Date Agreement (referencing the
Commencement Date of the Term of the 2nd Amendment of March 1, 2004)
(collectively, the “Symantec Sublease”), under which Symantec subleases from
BroadVision a portion of the Premises more particularly identified
therein.  A true and correct copy of the
Symantec Sublease is attached to this Agreement as Exhibit B-1.

 

C.            BroadVision and
Nextance, Inc., a Delaware corporation (“Nextance”) have previously entered
into that certain Sublease dated April 2, 2002, as amended by that certain
Consent to Sublease dated May 24, 2002 (collectively, the “Nextance Sublease”),
under which Nextance subleases from BroadVision a portion of the Premises more
particularly identified

 

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therein.  A true and correct
copy of the Nextance Sublease is attached to this Agreement as Exhibit B-2.

 

D.            BroadVision and
E2Open, Inc., a Delaware corporation (“E2Open”), as successor-by-merger to
E2Open, LLC, a Delaware limited liability company, have previously entered into
that certain Sublease dated June 19, 2002, as amended by that certain Consent
to Sublease dated July 25, 2002, that certain undated Commencement Date
Memorandum (referencing the Commencement Date of July 19, 2002), that certain
Amendment One to Sublease dated as of August    , 2002, and
that certain Letter Agreement re: Sublease Utility Charges dated June 24, 2004
(collectively, the “E2Open Sublease”), under which E2Open subleases from
BroadVision a portion of the Premises more particularly identified
therein.  A true and correct copy of the
E2Open Sublease is attached to this Agreement as Exhibit B-3.

 

E.             BroadVision and
MedExpert International, Inc., a Delaware corporation (“MedExpert”) have
previously entered into that certain Sublease dated May 28, 2003, as amended by
that certain Early Occupancy Agreement dated as of May 29, 2003, and that
certain Consent to Sublease dated June     , 2003
(collectively, the “MedExpert Sublease”), under which MedExpert subleases from
BroadVision a portion of the Premises more particularly identified
therein.  A true and correct copy of the
MedExpert Sublease is attached to this Agreement as Exhibit B-4.

 

F.             BroadVision and
Postini, Inc., a Delaware corporation (“Postini”) have previously entered into
that certain Sublease dated September 22, 2003, as amended by that certain
Consent to Sublease dated September 1, 2003 (collectively, the “Postini
Sublease”), under which Postini subleases from BroadVision a portion of the
Premises more particularly identified therein. 
A true and correct copy of the Postini Sublease is attached to this
Agreement as Exhibit B-5.

 

G.            Symantec, Nextance,
E2Open, MedExpert and Postini are sometimes referred to herein, individually,
each as a “Subtenant,” and, collectively, as the “Subtenants.”  The Symantec Sublease, the Nextance Sublease,
the E2Open Sublease, the MedExpert Sublease and the Postini Sublease are
sometimes referred to herein, individually, each as a “Sublease,” and,
collectively, as the “Subleases.”  Those
portions of the Premises that are subleased to the Subtenants under the
Subleases shall be collectively referred to herein as the “Subleased Premises”.

 

H.            BroadVision has
requested that PSI accept an assignment of all of BroadVision’s estate, right,
title and interest in, to and under the Master Lease, the Subleases and the
Premises, and that PSI assume BroadVision’s obligations under the Master Lease
and the Subleases.  PSI is prepared to
accept such assignment and to assume such obligations upon, and subject to, all
of the terms and conditions hereinafter set forth.

 

A  G
R  E  E  M  E  N  T:

 

NOW, THEREFORE, for good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereby agree as follows:

 

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ARTICLE 1

TRANSFER DATE

 

1.1           For purposes herein,
the term “Transfer Date” shall mean the date that all of the following
conditions have been satisfied:

 

1.1.1        BroadVision has paid the
First Installment (as defined in Section 5.1 below) to PSI in accordance with
Section 5.1 below;

 

1.1.2        BroadVision has delivered
the modification to the Existing LC (as defined in Section 5.2.1 below) to PSI
in accordance with Section 5.2.1 below;

 

1.1.3        BroadVision has delivered
the New LC (as defined in Section 5.2.2 below) to PSI in accordance with
Section 5.2.2 below;

 

1.1.4        BroadVision has delivered
the Warrant (as defined in Section 5.3 below) to PSI in accordance with Section
5.3 below;

 

1.1.5        BroadVision has delivered
the Bill of Sale (as defined in Section 5.4 below) to PSI in accordance with
Section 5.4 below and has fulfilled its obligations pursuant to Section 5.5
below with respect to the Service Contracts;

 

1.1.6        BroadVision has
surrendered the Subleased Premises and has vacated and surrendered the
Terminated Premises to PSI in accordance with Article 6 below;

 

1.1.7        BroadVision has executed
and delivered to PSI that certain lease of even date herewith for approximately
fifty thousand (50,000) square feet of rentable area at the Pacific Shores
Center (“New Lease”), and has delivered the letter of credit required by
Section 4.06 of the New Lease;

 

1.1.8        BroadVision has satisfied
all of the Sublease Transfer Conditions (as defined in Article 3 below); and

 

1.1.9        BroadVision has delivered
all information, material and documents to PSI required under this Agreement
and BroadVision has satisfied all conditions required of it under this
Agreement prior to the Transfer.

 

1.2           PSI and BroadVision
shall use their respective commercially reasonable, good faith efforts to cause
the Transfer Date to occur on or before August 1, 2004, but in any event as
soon as reasonably practicable.  If the
Transfer Date has not occurred on or before August 30, 2004, then, at any
time thereafter, either party shall have the right, exercisable in its sole and
absolute discretion, to terminate this Agreement and the New Lease by sending
written notice to the other party prior to the occurrence of the Transfer Date,
in which event the Master Lease shall remain unmodified and in full force and
effect.

 

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ARTICLE 2

ASSIGNMENT AND ASSUMPTION OF MASTER LEASE; NO MERGER

 

Effective as of the
Transfer Date, and subject to the terms, conditions and provisions of this
Agreement and conditioned upon the performance by BroadVision of its obligations
hereunder, BroadVision hereby assigns, sells, transfers, sets over and delivers
to PSI all of BroadVision’s estate, right, title and interest, as lessee, in,
to and under the Master Lease and the Premises, and PSI hereby accepts such
assignment and assumes, and agrees to perform, pay and discharge all terms,
covenants, conditions and obligations of BroadVision as lessee under the Master
Lease, including, but not limited to, payment of all rent due thereunder,
arising or accruing from and after the Transfer Date.  Notwithstanding the foregoing, subject to the terms of Article 7
below, BroadVision shall remain obligated under the Master Lease to pay to PSI,
as lessor under the Master Lease, all amounts owing by the lessee under the
Master Lease to the extent arising or accruing prior to the Transfer Date,
including, but not limited to, “Lessee’s Share” of “Operating Expenses” and all
other “Additional Rent,” as those terms are defined in the Master Lease.  Notwithstanding that PSI holds fee title to
the Building and the real property upon which the Building is located, it is
the express intent of PSI and BroadVision that the assignment of BroadVision’s
interest in the Master Lease to PSI not effect a merger of the leasehold estate
into the fee.

 

ARTICLE 3

ASSIGNMENT AND ASSUMPTION OF SUBLEASES

 

Effective as of the Transfer Date, and subject to the terms, conditions
and provisions of this Agreement and conditioned upon the performance by
BroadVision of its obligations hereunder, BroadVision hereby assigns, sells,
transfers, sets over and delivers to PSI all of BroadVision’s estate, right,
title and interest, as sublandlord, in, to and under the Subleases (and any
security deposits held by BroadVision under the Subleases, such amounts to be
transferred pursuant to Section 7.3 hereof), and PSI hereby accepts such
assignment and assumes, and agrees to perform, pay and discharge all terms,
covenants, conditions and obligations of BroadVision, as sublandlord, under the
Subleases arising or accruing from and after the Transfer Date.  In addition, on or before the Transfer Date,
BroadVision shall do all of the following (collectively, the “Sublease Transfer
Conditions”):  (a) BroadVision
shall do all acts and pay all fees and costs as may be required to effectuate
an assignment of the Subtenant Letters of Credit (as defined in
Section 8.5 below) to PSI; (b) BroadVision shall provide to PSI
estoppel certificates dated not earlier than July 1, 2004, and duly executed by
all of the Subtenants, each of which estoppel certificates shall
(i) certify, if true, that the applicable Sublease is unmodified and in
full force and effect (or, if modified, state the nature of such modification
and certify, if true, that such Sublease, as so modified, is in full force and
effect), (ii) certify the date to which the rent and other charges under
such Sublease have been paid in advance, if any, (iii) acknowledge, if
true, that there are not, to such Subtenant’s knowledge, any uncured defaults
on the part of the sublandlord under such Sublease, or specify such defaults if
any are claimed, (iv) certify or acknowledge such other matters as are
reasonably requested by PSI or its lender (including, without limitation,
confirmation that any expansion, first offer, first refusal or other similar
rights of such Subtenant have been exercised, have expired or continue in
effect, as the case may be), and (v) be in a form, and upon terms,
reasonably acceptable to PSI and PSI’s lender, it being understood that PSI
shall prepare draft estoppel certificates for execution by the

 

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Subtenants; (c) BroadVision shall provide to PSI subordination,
nondisturbance and attornment agreements dated not earlier than July 1, 2004,
and duly executed and acknowledged by all of the Subtenants, substantially in
the form attached to the New Lease as Exhibit “F” thereto; and
(d) BroadVision shall provide to PSI a written notice addressed to each
Subtenant duly executed by BroadVision notifying such Subtenant of the assignment
of its respective Sublease, providing PSI’s address for future payment of rent,
and informing such Subtenant of the transfer of its security deposit, if any,
in accordance with the requirements of California Civil Code § 1950.7(d).

 

ARTICLE 4

PARTIAL TERMINATION OF MASTER LEASE

 

PSI and BroadVision hereby agree that, subject to the terms, conditions
and provisions of this Agreement and conditioned upon the performance by
BroadVision of its obligations hereunder, the Master Lease shall terminate and
be of no further force or effect as to the portion of the Premises described on
Exhibit H attached hereto (the “Terminated Premises”) only as of the
Transfer Date; provided, however, that it is not the intent of the parties that
the foregoing partial termination of the Master Lease would in any way
adversely affect any expansion, first offer, first refusal or other similar
rights of any of the Subtenants, and PSI hereby covenants and agrees to honor
all of such rights as set forth in, and in accordance with, the Subleases.  From and after the Transfer Date, references
in the Master Lease to the “Premises” shall be deemed to include only the
Subleased Premises and not the Terminated Premises, unless the context clearly
requires otherwise.

 

ARTICLE 5

CONSIDERATION

 

5.1           Cash Consideration.  As consideration for PSI’s execution of this
Agreement and PSI’s obligations hereunder, BroadVision shall pay Pacific Shores
the sum of Thirty-Six Million Two Hundred Thousand and No/100 Dollars
($36,200,000.00) in two equal installments, as follows: (a) the first
installment of Eighteen Million One Hundred Thousand and No/100 Dollars
($18,100,000.00) shall be paid by wire transfer of immediately available funds
to PSI on or before the Transfer Date (“First Installment”) and timely payment
of such First Installment shall be a condition to the effectiveness of this
Agreement; and (b) the second installment of Eighteen Million One Hundred
Thousand and No/100 Dollars ($18,100,000.00) shall be paid by wire transfer of
immediately available funds to PSI on or before January 7, 2005 (“Second
Installment”).

 

5.2           Letters of Credit

 

5.2.1        BroadVision previously
delivered a letter of credit to PSI (which included a confirmation thereof)
under the Master Lease in the amount of Fourteen Million Four Hundred Three
Thousand Seven Hundred Seventy-Six and No/100 dollars ($14,403,776.00)
(“Existing LC”).  As consideration for
PSI’s execution of this Agreement and PSI’s obligations hereunder, on or before
the Transfer Date, BroadVision shall cause the Existing LC to be modified by
the issuing and confirming banks to provide, in addition to any and all rights
PSI has under the Master Lease with respect to the Existing LC, (i) that, if
required by PSI’s lender(s), (a)

 

5

 

PSI and PSI’s lender(s) shall be co-beneficiaries under the Existing LC
or (b) PSI’s lender(s) shall the beneficiary(ies) under the Existing LC, (ii)
that the beneficiary(ies) may draw on the Existing LC, in whole or in part, if
(a) BroadVision fails to pay either the First Installment or the Second
Installment, as provided for herein, or (b) a bankruptcy or other similar
insolvency proceeding (e.g., an assignment for the benefit of creditors) under
state law is commenced by or against BroadVision, (iii) that the
beneficiary(ies) may draw on the Existing LC upon the presentment of the
Existing LC to the issuing or confirming bank accompanied by a sight draft and
letter from the beneficiary(ies) stating that it (they) is (are) entitled to
draw on the Existing LC, and (iv) for a final expiry date no sooner than June
30, 2005.  Such modification to the
Existing LC shall be at the sole cost and expense of BroadVision.

 

5.2.2        As consideration for PSI’s
execution of this Agreement and PSI’s obligations hereunder, on or before the
Transfer Date, BroadVision shall deliver an unconditional, irrevocable, standby
letter of credit, in the amount of Three Million Six Hundred Ninety-Six
Thousand Two Hundred Twenty-Four and No/100 Dollars ($3,696,224.00), in a form
and issued or confirmed by a commercial money center bank reasonably
satisfactory to PSI with retail branches in San Francisco, California,
designating either (1) PSI as beneficiary or (2) if required by PSI’s
lender(s), (a) PSI and PSI’s lender(s) as co-beneficiaries, or (b) PSI’s
lender(s) as beneficiary(ies) (“New LC”). 
The New LC shall further provide that the beneficiary(ies) may draw on
the New LC, in whole or in part, if (a) BroadVision shall fail to pay either
the First Installment or the Second Installment, as provided for in this
Agreement, (b) a bankruptcy or other similar insolvency proceeding (e.g., an
assignment for the benefit of creditors) under state law is commenced by or
against BroadVision, (c) BroadVision shall fail to honor its indemnification
obligations to PSI under Article 11 of this Agreement, or (d) BroadVision shall
fail to pay the Termination Payment, as defined in the New Lease, in the event
BroadVision shall have exercised its termination right under the New Lease.  The New LC shall (1) have a final expiry
date no sooner than June 30, 2005, and (2) provide that is governed by the
Uniform Customs and Practice for Documentary Credits (1993 revisions)
International Chamber of Commerce Publication 500 or International Standard Practice
1998 (ISP 98), International Chamber of Commerce Practice, Publication No.
590.  The beneficiary(ies) may draw on
the New LC upon the presentment of the New LC to the issuing bank accompanied
by a sight draft and letter from the beneficiary(ies) stating that it (they) is
(are) entitled to draw on the New LC.

 

5.2.3        The proceeds of any draw
under the New LC or the Existing LC shall be for the sole benefit and account
of, and may be retained (unconditionally) by, PSI or PSI’s lender(s).

 

5.2.4        Within one hundred (100)
days following PSI’s receipt of both the First Installment and the Second
Installment, PSI shall return (1) the New LC, less any amounts previously drawn
under the New LC because of BroadVision’s failure to honor its indemnification
obligations to PSI under Article 11 of this Agreement, and (2) the Existing LC,
to BroadVision.  Notwithstanding the
foregoing, if BroadVision elects to exercise its right to make the Termination
Payment as provided for under the New Lease, then PSI or PSI’s lender(s) shall
retain the New LC, less any amounts previously drawn under the New LC because
of BroadVision’s failure to honor its indemnification obligations to PSI under
Article 11 of this Agreement as support for such Termination Payment, and PSI
shall return the same upon its expiration as provided for herein.

 

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5.3           Warrants.  Concurrent with the execution of this
Agreement, BroadVision will deliver to PSI a warrant in the form of Exhibit E
(the “Warrant”) entitling PSI or its assignees to purchase up to seven hundred
thousand (700,000) shares of BroadVision common stock exercisable at $5.00 per
share pursuant to the terms of the Warrant.

 

5.4           Transferred Property.  Effective as of the Transfer Date, BroadVision
shall convey to PSI all right, title and interest in and to that certain
furniture, fixtures and equipment currently located in the Premises, as set
forth on the Inventory attached hereto as Exhibit C (the
“Transferred Property”).  BroadVision
shall convey the Transferred Property to PSI pursuant to a Bill of Sale and
Assignment substantially in the form attached hereto as Exhibit D
(the “Bill of Sale”), which document shall be executed and delivered by
BroadVision to PSI concurrently with BroadVision’s execution and delivery of
this Agreement to PSI.  PSI shall
thereafter execute and deliver the Bill of Sale to BroadVision.

 

5.5           Assignment of
Certain Service Contracts. 
Effective as of the Transfer Date, and pursuant to the Bill of Sale,
BroadVision shall assign to PSI all right, title and interest in and to those
Service Contracts (as defined in Section 8.7 below) which PSI shall have
elected, by delivery of written notice to BroadVision prior to the Transfer
Date, to assume.  On or before the
Transfer Date, BroadVision shall provide to PSI written notices duly executed
by BroadVision to third parties under any Service Contracts which PSI has
elected to assume, changing the address for service of notice and delivery of
statements and bills.

 

ARTICLE 6

SURRENDER OF PREMISES

 

BroadVision hereby agrees to surrender and
deliver exclusive possession of the Subleased Premises, subject to the
Subleases, to PSI on or before the Transfer Date, in their current condition,
without the removal of any tenant improvements, furniture, fixtures or
equipment.  BroadVision hereby further
agrees to vacate the Terminated Premises and surrender and deliver exclusive
possession of the Terminated Premises and all improvements thereon to PSI on or
before the Transfer Date, broom clean in good order, condition and repair,
ordinary wear and tear excepted, in accordance with the provisions of Section
17.09 of the Master Lease.  Any
provisions of the Master Lease that could be read to require the removal from
the Subleased Premises or the Terminated Premises of any alterations, additions
or improvements (or restoration following such removal) that were made in
compliance with Section 6.03 of the Master Lease, are hereby expressly
waived.  BroadVision shall remain liable
for any alterations, additions or improvements (or restoration following such
removal) that were not made in compliance with Section 6.03 of the Master
Lease, notwithstanding the assignment and assumption of the Master Lease and
partial termination of the Master Lease as provided for in this Agreement.  On or before the Transfer Date, BroadVision
shall deliver to PSI all of the keys or other access devices to the Terminated
Premises and to any other locked areas which are part of the Terminated
Premises, and any keys or other access devices to the Subleased Premises which
are in BroadVision’s possession or control, if any.  On or before the Transfer Date, BroadVision shall, without
expense to PSI, remove or cause to be removed from the Terminated Premises all
debris and rubbish.  If BroadVision
fails to timely remove or cause to be removed all such debris and rubbish from
the Terminated Premises, then PSI may do so and may charge the cost thereof to
BroadVision.

 

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ARTICLE 7

PRORATIONS

 

Except as otherwise indicated, all revenues, income, receivables,
costs, expenses and payables relating to the Premises, the Master Lease and the
Subleases (including, without limitation, rents payable and receivable,
Operating Expenses, other Additional Rent, and subtenant reimbursements) shall
be prorated on a cash basis as of 11:59 p.m. on the day preceding the Proration
Date (as defined in Section 7.6 below) in accordance with the following
provisions:

 

7.1           Master Lease.  BroadVision shall be responsible for the
timely payment of all Base Rent and Additional Rent owing under items (i) and
(ii) of Section 4.05 of the Master Lease (including any adjustments related to
Operating Expenses or taxes) through the Proration Date, and for the timely
payment of all other Additional Rent (including any adjustments related to
other charges, costs or expenses) and other amounts as provided for under, and
as required by, the Master Lease through the Transfer Date, subject to the
proration of all such Base Rent, Additional Rent and other amounts in
accordance herewith.  Notwithstanding
the foregoing, if the Transfer Date has not occurred prior to August 6, 2004,
BroadVision shall be required to pay to PSI on August 6, 2004, all Base Rent
and Additional Rent owing for August 2004 (the “August 2004 Rent”); provided
that, if the Transfer Date occurs or if the August 2004 Rent is paid, in either
event on or before August 6, 2004, then, notwithstanding anything to the
contrary contained in the Master Lease, BroadVision shall not be in breach of
the Master Lease and shall not be liable for any late fees on account of its
failure to pay the August 2004 Rent prior to August 6, 2004.

 

7.2           Subleases.  To the extent collected by BroadVision prior
to the Transfer Date, all rents, reimbursements and other amounts payable by
the Subtenants under their respective Subleases (for purposes of this
Section 7.2, herein referred to as “Sublease Rents”) shall be prorated as
of the Proration Date by credit against proratable items payable to
BroadVision, and, to the extent of any excess, by payment from BroadVision to
PSI.

 

From and after the
Transfer Date, all payments of Sublease Rents (regardless of the period to
which the same apply) shall be made to PSI. 
PSI shall have no obligation to collect for BroadVision any Sublease
Rents from the Subtenants applicable to periods prior to the Proration Date,
nor shall PSI have any obligation to litigate or declare a default under any of
the Subleases by reason of any such unpaid Sublease Rents applicable to periods
prior to the Proration Date.  From and
after the date of this Agreement, BroadVision shall not have the right to
institute or continue any legal, equitable or other action, suit, arbitration
or pursue any claim against the Subtenants for any matter relating to the
Premises or the Subleases (other than a counterclaim, affirmative defense, or
cross-complaint in any action initiated against BroadVision by any
Subtenant).  After the Transfer Date,
BroadVision shall not be entitled to collect any delinquent Sublease Rents
payable to BroadVision by any Subtenant for periods prior to the Proration
Date.  Delinquent Sublease Rents
relating to periods prior to the Proration Date and collected by PSI following
the Transfer Date, if any, net of the costs of collection (including attorneys’
fees), shall be applied first to amounts currently due under the Subleases,
second to any amounts overdue to PSI, and lastly to any amounts overdue to
BroadVision (which amounts shall be paid to BroadVision by PSI).

 

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7.3           Sublease Deposits.  BroadVision shall pay to PSI an amount equal
to the amount of all Subtenant Security Deposits (as defined in
Section 8.5 below).  For purposes
of this Section 6.3, the amount of each Subtenant Security Deposit shall
include interest accrued thereon and held for the benefit of the applicable
Subtenant, if any.  BroadVision shall
indemnify, defend, and hold and save PSI, its partners, and their respective
officers, agents, servants, employees, and independent contractors harmless
from and against any and all loss, cost, damage, expense, and liability
(including, without limitation, court costs and reasonable attorneys’ fees)
incurred in connection with or arising from BroadVision’s application of any
Subtenant Security Deposit or draw under any Subtenant Letter of Credit in
breach of the terms of the applicable Sublease.

 

7.4           Utilities.  Except to the extent payable by the
Subtenants pursuant to the terms of their respective Subleases, all utility
charges and other expenses incurred in the ordinary course of managing and
operating the Premises disclosed in the Books and Records (as defined in
Section 8.9 below) and not covered elsewhere in this Article 7 shall
be prorated on an accrual basis as of the Proration Date.

 

7.5           Service Contracts.  Amounts payable under Service Contracts
which PSI has elected to assume shall be prorated on an accrual basis as of the
Proration Date.  BroadVision shall
terminate all Service Contracts which PSI has not elected to assume hereunder,
including, without limitation, payment of all charges in connection therewith.

 

7.6           Prorations Generally.  As used herein, the “Proration Date” shall
be determined as of the Transfer Date as follows:  (a) if the Transfer Date occurs on or before August 6, 2004,
then the Proration Date shall be the earlier to occur of (i) the Transfer
Date, or (ii) August 1, 2004; or (b) if the Transfer Date occurs
after August 6, 2004, then the Proration Date shall be that date which is five
(5) calendar days prior to the Transfer Date. 
Except as set forth above, all prorations shall be made in accordance
with customary practice for real estate transactions in San Mateo County,
California.  BroadVision and PSI shall
use commercially reasonable efforts prior to the Transfer Date to prepare a
schedule of prorations covering as many items to be prorated as practicable on
or before the Transfer Date.  To the
extent that such schedules show that BroadVision has underpaid on account of
Lessee’s Share of Operating Expenses and/or other Additional Rent as of the
Transfer Date (subject to proration as set forth herein), such underpayment
shall be paid by BroadVision to PSI on the Transfer Date; to the extent that
such schedule shows that BroadVision has overpaid on account of Lessee’s Share
of Operating Expenses and/or other Additional Rent as of the Transfer Date
(subject to proration as set forth herein), BroadVision shall not be entitled
to any reimbursement for such overpayment until the final accounting for the
calendar year 2004 has been prepared and the annual reconciliation of Lessee’s
Share of Operating Expenses and/or other Additional Rent has been determined in
accordance with the terms of the Master Lease. 
To the extent that such schedule shows that any Subtenant has overpaid
for operating expenses as of the Proration Date, such overpayment shall be paid
by BroadVision to PSI on the Transfer Date; to the extent that such schedule
shows that any Subtenant has underpaid for operating expenses as of the
Proration Date, BroadVision shall not be entitled to any reimbursement for such
underpayment until the final accounting for the calendar year 2004 has been
prepared and the annual reconciliation of expense reimbursements payable by subtenants
has been determined.  All prorations
shall be adjusted, if necessary, and completed after the Transfer Date as soon
as final information

 

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becomes available.  Subsequent
to the Transfer Date, PSI and BroadVision shall each render periodic
accountings to the other of amounts received or paid by them subject to
proration and, if such accountings show any amounts owing from one party to the
other, the party owing such amount shall promptly pay it.  BroadVision and PSI agree to cooperate and
to use commercially reasonable efforts to complete such prorations no later
than thirty (30) days after the Transfer Date, except for any annual
reconciliation of Lessee’s Share of Operating Expenses and/or Additional Rent
payable under the Master Lease and any expense reimbursements payable by
Subtenants which cannot be completed until the final accounting for the
calendar year 2004 has been prepared.

 

ARTICLE 8

REPRESENTATIONS AND WARRANTIES BY BROADVISION

 

In addition to any
express agreements of BroadVision contained herein, the following constitute
representations and warranties of BroadVision to PSI which shall be true and
correct as of the date hereof and as of the Transfer Date as if remade in a
separate certificate at that time, and which shall specifically survive the
Transfer Date.

 

8.1           Authority.  BroadVision has the legal power, right and
authority to enter into this Agreement and the instruments referenced herein,
including, but not limited to, the Bill of Sale, and to consummate the
transactions contemplated hereby; and the individuals executing this Agreement
and the instruments referenced herein (including, but not limited to, the Bill
of Sale) on behalf of BroadVision and the officers or directors of BroadVision
have the legal power, right, and actual authority to bind BroadVision to the
terms and conditions hereof and thereof.

 

8.2           Adverse Claims.  BroadVision has not received written notice
of, and to the best of BroadVision’s knowledge, (i) there are no uncured
defaults by BroadVision under the Subleases, (ii) there are no pending,
threatened or contemplated actions, suits, arbitrations, claims or proceedings,
at law or in equity, affecting BroadVision’s possession or occupancy of the
Premises or its subleasing of any portion thereof, and (iii) BroadVision
has no claim, controversy, dispute, quarrel, or disagreement against or with
any of the Subtenants.  Further, no
Subtenant has given any notice to BroadVision of any defenses to, offsets or
claims against rents payable or any other obligations under any of the
Subleases.

 

8.3           Default Notices and
Governmental Regulations.  To the
best of BroadVision’s knowledge, there are no violations of laws bearing on the
construction, alteration, rehabilitation, maintenance, use or operation of the
Premises or any portion thereof subject to the Subleases, and BroadVision has
not received any notices from any authority, insurance company or any of the
Subtenants of any defects or inadequacies in or violations relating to any
portion of the Premises.

 

8.4           Hazardous Materials.  To the best of BroadVision’s knowledge, all
operations and activities upon, and use and occupancy of, all or any part of
the Premises by BroadVision and the Subtenants are in compliance with all state,
federal and local laws and regulations governing any toxic, hazardous or
radioactive substances, materials, or waste (“Hazardous Materials”).  BroadVision has not received written notice
of, and to the best of

 

10

 

BroadVision’s knowledge there is no, proceeding or inquiry by any
authority (including, without limitation, the California State Department of
Health Services) with respect to the presence of any Hazardous Materials in,
on, under or about the Premises. 
BroadVision has not received written notice of, and to the best of
BroadVision’s knowledge there has been no, production, storage or disposal on
the Premises of any Hazardous Material by BroadVision or the Sublessee in
violation of law.

 

8.5           Subleases.  Attached hereto as Exhibit F is
a true, correct and complete list (the “Rent Roll”) setting forth:  (i) the name of all Subtenants and a
description of their respective Subleases (including all riders, supplements
and amendments); (ii) the portion of the Premises and the total number of
square feet of Rentable Area covered by each Sublease (including any options to
expand); (iii) the date, commencement date, and expiration date (including
option periods) of each Sublease; (iv) the current monthly rental payable
and future increases under each Sublease (including base rent and any expense
reimbursements) and other charges payable by such Subtenant; (v) the
amount of all security deposits, prepaid rentals, cleaning fees and other
deposits, plus any interest accrued thereon, paid by Subtenants to BroadVision
or any other person relative to the Premises owed to any Subtenants pursuant to
the terms of their respective Subleases (collectively, “Subtenant Security
Deposits”), and the amount of all letters of credit issued to BroadVision, as
beneficiary, as security for or in connection with any obligations of
Subtenants under their respective Subleases (collectively, “Subtenant Letters
of Credit”); (vi) whether any Subtenant is entitled to any storage space
or parking; (vii) whether any rents or other charges are in arrears or
prepaid and the period to which such arrearages or prepayments relate;
(viii) all incentives, concessions, abatements, allowances or inducements
granted to each Subtenant (including any not completed tenant improvement
work), and (ix) any unpaid leasing commissions, broker’s commissions or
finder’s fees with respect to each Sublease (including potential obligations in
connection with the exercise of any unexercised options to expand or
extend).  Each Sublease (A) has
been duly authorized and executed by BroadVision and, to the best of
BroadVision’s knowledge, by the respective Subtenant thereunder; (B) is in
full force and effect according to the terms set forth therein; (C) sets
forth the entire agreement between BroadVision and the respective Subtenant
thereunder with respect to the subject portion of the Subleased Premises; and
(D) covers only that portion of the Premises described hereinabove with
respect to such Sublease.  BroadVision
has not granted to any Subtenant any tenant improvement allowance or similar
tenant allowance or cash payment (e.g.,
refurbishment allowance or moving allowance) or any early termination right,
except as expressly set forth in the Subleases.  All of BroadVision’s obligations under the Subleases have been
performed in accordance with the requirements thereof.  No Subtenant has been released or
discharged, either voluntarily or involuntarily, from any future obligation
related to its respective Sublease.  Each
Subtenant is in occupancy of the entire portion of the Subleased Premises under
its respective Sublease.  BroadVision
has not entered into any subleases, occupancies or tenancies in effect
pertaining to the Premises, except the Subleases described on the Rent Roll
(true, correct and complete copies of which have been delivered to PSI by
BroadVision pursuant to this Agreement), and BroadVision has no knowledge of
any oral agreements between BroadVision and any other party, including the
Subtenants, with respect to the occupancy of the Premises.  Neither BroadVision’s interest in the
Subleases nor BroadVision’s interest in any of the rentals due or to become due
under the Subleases shall be assigned, encumbered or subject to any liens as of
the Transfer Date.

 

11

 

8.6           Leasing Commissions.  There are no leasing commissions, broker’s
commissions or finder’s fees due and owing, or which may become due or owing,
with respect to the Subleases (including potential obligations in connection
with the exercise of any unexercised options to expand or extend).  No leasing or brokerage fees or commissions
of any nature whatsoever shall be or become due or owing to any person, firm,
corporation or entity whomsoever after the Proration Date with respect to the
Subleases.

 

8.7           Service Contracts.  Attached hereto as Exhibit G is
a true, correct and complete list of all service contracts, maintenance
contracts, operating contracts, management contracts, warranties, guarantees,
bonds, listing agreements, parking contracts and like contracts and agreements
relating to the Premises (“Service Contracts”).  BroadVision heretofore has provided PSI with complete copies of
all Service Contracts (including all supplements, amendments and modifications
thereto).  There are no Service
Contracts (whether oral or written) which affect or will affect or which are or
will be obligations of PSI or the Premises, other than those Service Contracts
which have been delivered to PSI by BroadVision pursuant to this Agreement and
which PSI has elected to assume, if any. 
All of BroadVision’s obligations under the Service Contracts have been
performed in accordance with the requirements thereof.  BroadVision shall indemnify, defend, and
hold and save PSI, its partners, and their respective officers, agents,
servants, employees, and independent contractors harmless from and against any
and all loss, cost, damage, expense, and liability (including, without
limitation, court costs and reasonable attorneys’ fees) incurred in connection
with or arising from any of the Service Contracts which PSI has not elected to
assume.  PSI will cooperate with
BroadVision to take commercially reasonable steps (but at no additional cost to
PSI) to minimize any future obligations of BroadVision under the Service
Contracts not assumed by PSI.

 

8.8           Personal Property
and Equipment.  BroadVision is not
entitled to remove any personal property or equipment provided to the
Subtenants pursuant to or in connection with the terms of the Subleases.  BroadVision shall not make any claim against
any of the Subtenants to recapture or remove any personal property and/or
equipment from the Subtenants under the Subleases, and all such personal
property and/or equipment shall be included in the Transferred Property
transferred by BroadVision to PSI pursuant to this Agreement and the Bill of
Sale.  BroadVision has good and
marketable title to the Transferred Property set forth on Exhibit C,
free and clear of all liens and encumbrances.

 

8.9           Books and Records.  Prior to the Transfer Date BroadVision shall
make available to PSI, and upon the Transfer Date BroadVision shall deliver and
assign to PSI, all financial and other books and records maintained
specifically in connection with the operation of the Premises (collectively,
the “Books and Records”), including, without limitation, the following, all of
which shall be in form and content sufficient to allow PSI to calculate each
Subtenant’s expense pass-throughs and to satisfy all requirements under the
Subleases with regard to documentation of charges payable by Subtenants:  (a) for the calendar year 2003:  (i) complete copies of all statements
and similar billing correspondence to the Subtenants; (ii) a complete
detailed general ledger, by expense category of the expenses of the Premises
(preferably including copies of all invoices for expenses of the Premises); and
(iii) each reconciliation of expense pass-throughs to the Subtenants
either billed in 2003 (whether for calendar year 2003 or for previous periods)
or related to 2003 (but billed in later periods); and (b) for the
year-to-date 2004:  (I) complete
copies of all statements and similar billing

 

12

 

correspondence to the Subtenants; (II) a complete detailed general
ledger, by expense category of the expenses of the Premises (including copies
of all invoices for expenses of the Premises); and (III) copies of all
BroadVision checks or wire transfers for payment of expenses of the Premises paid
during the sixty (60) days preceding the Proration Date.  BroadVision shall indemnify, defend, and
hold and save PSI, its partners, and their respective officers, agents,
servants, employees, and independent contractors harmless from and against any
and all loss, cost, damage, expense, and liability (including, without
limitation, court costs and reasonable attorneys’ fees) incurred in connection
with or arising from any breach of the terms of any of the Subleases arising
out of or in connection with any inaccuracy or incompleteness of any of such
financial or other accounting information or any Books and Records.

 

ARTICLE 9

REPRESENTATIONS AND WARRANTIES BY PSI

 

In addition to any
express agreements of PSI contained herein, the following constitute
representations and warranties of PSI to BroadVision which shall be true and
correct as of the Transfer Date:  (i)
PSI has the legal power, right and authority to enter into this Agreement and
the instruments referenced herein, and to consummate the transaction contemplated
hereby; (ii) the individuals executing this Agreement and the instruments
referenced herein on behalf of PSI have the legal power, right and actual
authority to bind PSI to the terms and conditions hereof and thereof; and (iii)
there are no required third party consents or approvals to this Agreement that
have not been obtained.

 

ARTICLE 10

OPERATIONS PENDING TRANSFER

 

10.1         BroadVision’s
Covenants Regarding Operation of the Premises Through the Transfer Date.  From and after the date of this Agreement,
through and including the Transfer Date, BroadVision covenants as follows:

 

10.1.1      BroadVision, at its sole
cost and expense, shall comply with all terms of the Master Lease;

 

10.1.2      BroadVision shall not make
any alterations to the Premises, except for repairs (in which case, BroadVision
shall provide prior notice thereof to PSI, if practicable, and if prior notice
is not practicable, then BroadVision shall provide notice to PSI promptly
thereafter);

 

10.1.3      BroadVision shall not
modify, extend, terminate or otherwise change any of the terms, covenants or
conditions of any of the Subleases or enter into any new subleases or any other
obligations or agreements affecting the Premises, or any portion thereof,
without the prior written consent of PSI in each instance, which consent may be
withheld in PSI’s sole discretion;

 

10.1.4      BroadVision shall not accept
from any Subtenant payment of rent more than one month in advance nor apply any
security deposit to rent or any other sum due from, or on account of any
default by, any Subtenant;

 

13

 

10.1.5      BroadVision shall not
extend, renew, modify or replace any of the Service Contracts without the prior
written consent of PSI and, either prior to the Transfer Date or as soon
thereafter as reasonably practicable, BroadVision shall cancel all Service
Contracts which PSI has not elected to assume, it being understood that
BroadVision shall be solely responsible for performance under any Service
Contracts which PSI has not elected to assume and which are not canceled by
their terms as of the Transfer Date;

 

10.1.6      BroadVision shall promptly
notify PSI of any change in any condition with respect to the Premises, the
Master Lease, the Subleases or the Service Contracts, or of any event or
circumstance which makes any representation or warranty of BroadVision under
this Agreement untrue or misleading in any material respect; and

 

10.2         PSI’s Covenants
Regarding Operation of the Premises Through the Transfer Date.  From and after the date of this Agreement,
through and including the Transfer Date, PSI shall comply with all terms of the
Master Lease and shall continue to provide all services and manage and maintain
the Premises as required of the lessor under the Master Lease.

 

10.3         Breach By BroadVision
or PSI.  In the event of a breach by
BroadVision of any of the representations and warranties set forth in
Article 8 above, or the covenants set forth in Section 10.1 above, PSI
shall have the right to pursue any remedy available to it at law or in
equity.  In the event of any breach by
PSI of any of the representations and warranties set forth in Article 9
above, or the covenant set forth in Section 10.2 above, BroadVision shall have
the right to pursue any remedy available to it at law or in equity.

 

ARTICLE 11

INDEMNITIES

 

The indemnification obligations of BroadVision under the Master Lease
shall survive the assignment of BroadVision’s interest in the Master Lease to
PSI pursuant to this Agreement with respect to any matters which arise or
accrue prior to the Transfer Date.  In
addition, BroadVision hereby agrees to indemnify, protect, defend and hold PSI
and its officers, directors, partners, members, agents, attorneys, and
employees harmless from and against any and all claims, losses, liabilities,
actions, causes of action, penalties, demands, and expenses of any kind or
nature, including reasonable attorneys’ fees, arising out of, resulting from,
or relating to (i) any breach by BroadVision, prior to and including the
Transfer Date, of any of BroadVision’s obligations under the Subleases,
including, but not limited to, with respect to any security deposit held in
connection therewith or with respect to its failure to provide E2Open or
Symantec proper notices under their respective Subleases with respect to
expansion space or right of first refusal space, (ii) any conflict between
any expansion, first offer, first refusal or other similar rights granted to
the Subtenants by BroadVision, whether the same arose prior to, on or after the
Transfer Date, or (ii) any breach by BroadVision of the terms of
Article 8 or Section 10.1 of this Agreement.  PSI hereby agrees to indemnify, protect,
defend and hold BroadVision and its officers, directors, partners, agents,
attorneys, and employees harmless from and against any and all claims, losses,
liabilities, actions, causes of action, penalties, demands, and expenses of any
kind or nature, including reasonable attorneys’ fees, arising out of, resulting
from, or relating to (i) any breach by PSI after the Transfer Date of any
of PSI’s obligations under the Master Lease or the Subleases, or (ii) any
breach by PSI of the terms of Article 9 or Section 10.2 of this
Agreement.

 

14

 

ARTICLE 12

MISCELLANEOUS

 

12.1         Notices.  Unless otherwise expressly provided herein,
all notices or other communications required or permitted hereunder shall be in
writing, and shall be personally delivered (including by means of professional
messenger service) or sent by reputable overnight courier service or certified
mail, postage prepaid, return receipt requested, and shall be deemed received
upon the date of receipt thereof at the address set forth below the signature
of the appropriate party.  Notices of
change of address shall be given by written notice as described in this
Section.

 

	
  If to PSI:

  	
  Pacific Shores
  Investors, LLC

  c/o Paul Holdings, Inc.

  350 California Street, Suite 1905

  San Francisco, California 90025

  Attention:  Mr. Jay Paul

  
	
   

  	
   

  
	
  With a copy to:

  	
  Allen Matkins Leck Gamble & Mallory LLP

  Three Embarcadero Center, 12th Floor

  San Francisco, California 94111-4074

  Attn:  Nicholas B. Waranoff, Esq.

  
	
   

  	
   

  
	
  If to BroadVision:

  	
  BroadVision, Inc.

  585 Broadway

  Redwood City, California 94063

  Attention:Legal Department

  
	
   

  	
   

  
	
  with a copy to:

  	
  Cooley Godward LLP

  One Maritime Plaza, 20th Floor

  San Francisco, California 94111

  Attention:  Kenneth Guernsey, Esq.

  

 

12.2         Partial Invalidity.  If any term or provision of this Agreement
or the application thereof to any person or circumstance shall, to any extent,
be invalid or unenforceable (other than provisions going to the essence of this
Agreement), the remainder of this Agreement, or the application of such term or
provision to persons or circumstances other than those as to which it is held
invalid or unenforceable, shall not be affected thereby, and each such term and
provision of this Agreement shall be valid and be enforced to the fullest
extent permitted by law.

 

12.3         Waivers.  No waiver of any breach of any covenant or
provision herein contained shall be deemed a waiver of any preceding or
succeeding breach thereof, or of any other covenant or provision herein
contained.  No extension of time for
performance of any obligation or act shall be deemed an extension of the time
for performance of any other obligation or act.

 

15

 

12.4         Survival.  The covenants, agreements, representations
and warranties made herein shall survive the Transfer Date.

 

12.5         Successors and Assigns.  This Agreement shall be binding upon and
shall inure to the benefit of the permitted successors and assigns of the
parties hereto.

 

12.6         Attorneys’ Fees.  In the event that either party hereto brings
any action or suit against the other party by reason of any breach of any of
the covenants, agreements or provisions on the part of such other party arising
out of this Agreement, then all costs and expenses, including reasonable
attorneys’ and experts’ fees and costs, incurred by the prevailing party
therein shall be paid by the other party.

 

12.7         Entire Agreement.  This Agreement (including all Exhibits
attached hereto) is the final expression of, and contains the entire agreement
between, the parties with respect to the subject matter hereof and supersedes
all prior understandings with respect thereto. 
This Agreement may not be modified, changed, supplemented or terminated,
nor may any obligations hereunder be waived, except by written instrument
signed by the parties.  The parties do
not intend to confer any benefit hereunder on any person, firm or corporation
other than the parties hereto.

 

12.8         Time of the Essence.  BroadVision and PSI hereby acknowledge and
agree that time is of the essence with respect to each and every term,
condition, obligation and provision hereof.

 

12.9         Construction.  Headings at the beginning of each Section
and subparagraph are solely for the convenience of the parties and are not a
part of the Agreement.  Whenever
required by the context of this Agreement, the singular shall include the
plural and the masculine shall include the feminine and vice versa.  This Agreement shall not be construed as if
it had been prepared by one of the parties, but rather as if both parties had
prepared the same.  Unless otherwise
indicated, all references to Sections and subparagraphs are to this
Agreement.  All exhibits referred to in
this Agreement are attached and incorporated herein by this reference.  If the date on which PSI or BroadVision is
required to take any action under the terms of this Agreement occurs on a
Saturday, Sunday or federal or state holiday, then the action shall be taken on
the next succeeding business day.

 

12.10       Governing Law.  This Agreement shall be governed by,
interpreted under, and construed and enforced in accordance with the laws of the
State of California.

 

12.11       Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, and all of which,
together, shall constitute one and the same instrument.

 

12.12       No Joint Venture.  This Agreement shall not create a
partnership or joint venture relationship between PSI and BroadVision.

 

12.13       Required Actions of PSI
and BroadVision.  PSI and
BroadVision agree to execute all such instruments and documents and to take all
actions pursuant to the provisions

 

16

 

hereof in order to consummate the assignments and assumptions herein
contemplated and shall use their commercially reasonable best efforts to
consummate the transaction contemplated by this Agreement in accordance with
the provisions hereof.

 

12.14       Confidentiality.  PSI and BroadVision agree to keep the terms
and conditions of this Agreement confidential, disclosing the terms hereof only
to the extent necessary to satisfy the minimum
financial reporting disclosure requirements, or as otherwise may be required by
the parties’ respective lenders. 
Notwithstanding the foregoing, BroadVision may disclose terms of this
Agreement (i) at the request of any regulatory authority or
self-regulatory organization, including in connection with an examination of
BroadVision or its affiliates by any such authority or organization,
(ii) pursuant to subpoena or other court process, (iii) when required
to do so in accordance with the provision of any applicable law or regulation,
or (iv) at the direction of any other agency of any state of the United
States or of any other jurisdiction in which BroadVision or its affiliates
conducts their business.

 

IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the date and year first
written hereinabove.

 

	
  PACIFIC SHORES INVESTORS, LLC,

  a Delaware limited liability company

  	
   

  	
  BROADVISION, INC., 

  a Delaware corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  Pacific Shores
  Mezzanine, LLC, a Delaware limited

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  liability company, its
  sole member

  	
   

  	
  By:

  	
  /s/ Pehong Chen

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Pehong Chen

  	
   

  
	
   

  	
  By:

  	
  Pacific Shores Junior
  Mezz, LLC, a Delaware

  	
   

  	
  Title:

  	
  Chairman, CEO &
  President

  	
   

  
	
   

  	
   

  	
  limited liability
  company, its sole member

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Scott C. Neely 

  	
   

  
	
   

  	
   

  	
  By:

  	
  Pacific Shores Junior
  Mezz Managers,

  	
   

  	
  Name:

  	
  Scott C. Neely

  	
   

  
	
   

  	
   

  	
   

  	
  LLC, a Delaware limited
  liability

  	
   

  	
  Title:

  	
  VP, General Counsel
  & Asst. Secty  

  	
   

  
	
   

  	
   

  	
   

  	
  company, its sole
  member

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Pacific Shores
  Development, LLC, a

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Delaware limited
  liability company, its

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  sole member

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Technology Land LLC, a

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  California limited
  liability

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  company, Operating
  Member

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Joseph K. Paul

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Joseph
  K. Paul, 

  Sole Managing Member

  	
   

  	
   

  	
   

  	
   

  
														

 

17Exhibit
10.45

 

WARRANT

 

THIS WARRANT IS SUBJECT
TO RESTRICTIONS ON TRANSFER AS SET FORTH IN SECTION 9 HEREIN.  THE WARRANT EVIDENCED OR CONSTITUTED HEREBY,
AND ALL SHARES OF COMMON STOCK ISSUABLE HEREUNDER, HAVE BEEN AND WILL BE ISSUED
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (“THE ACT”),
AND EXCEPT AS OTHERWISE PROVIDED HEREIN MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED WITHOUT REGISTRATION UNDER THE ACT UNLESS
EITHER (A) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT
REGISTRATION IS NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION OR
(B) THE SALE OF SUCH SECURITIES IS MADE PURSUANT TO SECURITIES AND
EXCHANGE COMMISSION RULE 144.

 

WARRANT TO PURCHASE
COMMON STOCK 

 

OF

 

BROADVISION, INC.

 

July 7, 2004

 

THIS
CERTIFIES THAT, for value received, PACIFIC SHORES INVESTORS,
LLC, a Delaware limited liability company (“Holder”), is entitled,
subject to the terms and conditions of this Warrant, at any time or from time
to time after July 7, 2004 (the “Effective Date”), to purchase from
BROADVISION, INC., a Delaware
corporation (the “Company”), up to Seven Hundred Thousand
(700,000) shares of common stock, par value $0.0001 per share (the “Common
Stock”), of the Company, at a price of $5.00 per share (the “Exercise
Price”).  This Warrant shall expire
at 5:00 p.m. Pacific time on July 6, 2009 (the “Expiration Date”).  Both the number of shares of Common Stock
purchasable upon exercise of this Warrant and the Exercise Price are further
subject to adjustment and change as provided herein.

 

1.             CERTAIN DEFINITIONS.  As used in this Warrant the following terms
shall have the following respective meanings:

 

“Acquisition”
means (a) any sale or exchange of the capital stock by the stockholders of
the Company in one transaction or series of related transactions where more
than 50% of the outstanding voting power of the Company is acquired by a person
or entity or group of related persons or entities; or (b) any
reorganization, consolidation, merger or similar transaction or series of
related transactions (each, a “Combination Transaction”) in which the Company
is a constituent corporation or is a party if, as a result of such Combination
Transaction, the voting securities of the Company that are outstanding
immediately prior to the consummation of such Combination Transaction do not
represent, or are not converted into, securities of the surviving corporation
of such Combination

 

 

Transaction (or such surviving corporation’s parent corporation if the
surviving corporation is owned by the parent corporation) that, immediately
after the consummation of such Combination Transaction, together possess at
least fifty percent (50%) of the total voting power of all securities of such
surviving corporation (or its parent corporation, if applicable) that are
outstanding immediately after the consummation of such Combination Transaction;
or (c) a sale of all or substantially all of the assets of the Company,
that is followed by the distribution of the proceeds to the Company’s
stockholders.  For these purposes, an
“Acquisition for Cash” means any Acquisition where the holders of the Company’s
securities before the transaction receive solely cash consideration in connection
with such transaction.

 

“Act” shall
mean the Securities Act of 1933, as amended.

 

“Common Stock”
shall mean the Common Stock of the Company and any other securities at any time
receivable or issuable upon exercise of this Warrant.

 

“Fair Market Value”
of a share of Common Stock as of a particular date shall mean:

 

(a)           If traded on a
securities exchange, the Nasdaq Bulletin Board, the Nasdaq Small Cap Market or
the Nasdaq National Market, as the case may be, the Fair Market Value shall be
deemed to be the average of the closing prices of the Common Stock of the
Company on such exchange or market over the five (5) business days ending
immediately prior to the applicable date of valuation;

 

(b)           If actively traded
over-the-counter, the Fair Market Value shall be deemed to be the average of
the closing bid prices over the thirty (30) day period ending immediately
prior to the applicable date of valuation; and

 

(c)           If there is no active
public market, the Fair Market Value shall be the value as determined in good
faith by the Company’s Board of Directors upon a review of relevant factors,
including due consideration of the Holders’ determination of the value of the
Company based on what a third party would pay for the shares in an arm’s length
transaction, unless prior to such date the Company has become subject to a
binding agreement for an Acquisition, in which case the current fair market
value of the Common Stock shall be deemed to be the value received by the
holders of the Common Stock for each share thereof pursuant to the Company’s
Acquisition.

 

“Holder”
shall include the original Holder and any subsequent Holder.

 

“SEC” shall
mean the Securities and Exchange Commission.

 

2.             EXERCISE OF WARRANT

 

2.1.          Rights to Exercise

 

(a)           The rights represented
by this Warrant may be exercised at any time on or after the first anniversary
of the Effective Date and up through the Expiration Date, in whole or in part,
by (i) the surrender of this Warrant (with the purchase form attached
hereto as Exhibit A
properly executed) at the principal executive office of the Company (or such
other office or agency of the Company as it may designate by notice in writing
to the Holder at the address of the Holder

 

2

 

appearing on the books of the Company); and (ii) payment to the
Company of the exercise price then in effect (subject to the provisions of
subsection (c) below) for the number of shares specified in the above-mentioned
purchase form together with applicable stock transfer taxes, if any.  All payments under this Warrant may be made
by cash (including wire transfer), check or cancellation of indebtedness.  This Warrant shall be deemed to have been
exercised, in whole or in part to the extent specified, immediately prior to
the close of business on the date this Warrant is surrendered and payment is
made in accordance with the foregoing provisions of this Section 2, and
the person or persons in whose name or names the certificates for the shares
shall be issuable upon such exercise shall become the holder or holders of
record or such shares at that time and date. 
The shares and the certificates for the shares so purchased shall be
delivered to the Holder within a reasonable time, not exceeding two
(2) business days, after the rights represented by this Warrant shall have
been so exercised.

 

(b)           Rights to Exercise during the
First 12 months.  Notwithstanding
anything to the contrary contained in paragraph 2.1, the Holder may nonetheless
elect to exercise this Warrant in whole or in part during the first 12 months
following the Effective Date in connection with an Acquisition of the Company
initiated (whether by the Company or the acquiring entity) or completed during
that period.

 

(c)           Net Exercise Provisions.  Further notwithstanding anything to the
contrary contained in paragraph 2.1, the Holder may elect to exercise this
Warrant in whole or in part by receiving shares equal to the value (as
determined below) of this Warrant, or any part hereof, upon surrender of this
Warrant at the principal office of the Company together with notice of such
election in which event the Company shall issue to the Holder a number of
shares computed using the following formula:

 

	
  X =

  	
   

  	
  Y(A-B)

  	
   

  
	
   

  	
   

  	
  A

  	
   

  

 

Where X =             the number of shares
to be issued to the Holder (provided however that in no event shall X equal
less than zero);

 

Y =                          the
number of shares issuable upon exercise of this Warrant;

 

A =                         the
current Fair Market Value of one share of Common Stock calculated as of the
last business day immediately preceding the exercise of this Warrant;

 

B =                          the
Exercise Price of this Warrant (as adjusted as provided herein).

 

2.2.          Stock Certificates;
Fractional Shares.  As soon as
practicable on or after the date of an exercise of this Warrant, the Company
shall issue and deliver to the person or persons entitled to receive the same a
certificate or certificates for the number of whole shares of Common Stock
issuable upon such exercise, together with cash in lieu of any fraction of a
share equal to such fraction of the current Fair Market Value of one whole
share of Common Stock as of the date of exercise of this Warrant.  No fractional shares or scrip representing
fractional shares shall be issued upon an exercise of this Warrant.

 

3

 

2.3.          Partial Exercise;
Effective Date of Exercise.  In case
of any partial exercise of this Warrant, the Company shall cancel this Warrant
upon surrender hereof and shall execute and deliver a new Warrant of like tenor
and date for the balance of the shares of Common Stock purchasable
hereunder.  This Warrant shall be deemed
to have been exercised immediately prior to the close of business on the date
of its surrender for exercise as provided above.  The person entitled to receive the shares of Common Stock
issuable upon exercise of this Warrant shall be treated for all purposes as the
holder of record of such shares as of the close of business on the date the
Holder is deemed to have exercised this Warrant.

 

3.             VALID ISSUANCE; TAXES.  All shares of Common Stock issued upon the
exercise of this Warrant shall be validly issued, fully paid and
non-assessable, and the Company shall pay all taxes and other governmental
charges that may be imposed in respect of the issue or delivery thereof.  The Company shall not be required to pay any
tax or other charge imposed in connection with any transfer involved in the
issuance of any certificate for shares of Common Stock in any name other than
that of the Holder of this Warrant, and in such case the Company shall not be
required to issue or deliver any stock certificate or security until such tax
or other charge has been paid, or it has been established to the Company’s
reasonable satisfaction that no tax or other charge is due.

 

4.             ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES.  The number of shares of Common Stock
issuable upon exercise of this Warrant (or any shares of stock or other
securities or property receivable or issuable upon exercise of this Warrant)
and the Exercise Price are subject to adjustment upon occurrence of the
following events:

 

4.1.          Adjustment for Stock
Splits, Stock Subdivisions or Combinations of Shares.  The Exercise Price of this Warrant shall be
proportionally decreased and the number of shares of Common Stock issuable upon
exercise of this Warrant (or any shares of stock or other securities at the
time issuable upon exercise of this Warrant) shall be proportionally increased
to reflect any stock split or subdivision of the Company’s Common Stock.  The Exercise Price of this Warrant shall be
proportionally increased and the number of shares of Common Stock issuable upon
exercise of this Warrant (or any shares of stock or other securities at the
time issuable upon exercise of this Warrant) shall be proportionally decreased
to reflect any combination of the Company’s Common Stock.

 

4.2.          Adjustment for
Dividends or Distributions of Stock or Other Securities or Property.  In case the Company shall make or issue, or
shall fix a record date for the determination of eligible holders entitled to
receive, a dividend or other distribution with respect to the Common Stock (or
any shares of stock or other securities at the time issuable upon exercise of
the Warrant) payable in (a) securities of the Company or (b) assets
(excluding cash dividends paid or payable solely out of retained earnings),
then, in each such case, the Holder of this Warrant on exercise hereof at any
time after the consummation, effective date or record date of such dividend or
other distribution, shall receive, in addition to the shares of Common Stock
(or such other stock or securities) issuable on such exercise prior to such
date, and without the payment of additional consideration therefor, the
securities or such other assets of the Company to which such Holder would have
been entitled upon such date if such Holder had exercised this Warrant on the
date hereof and had thereafter, during the period from the date hereof to and
including the date of such exercise, retained such shares and/or all other
additional stock available by it as aforesaid during such period giving effect
to all adjustments called for by this Section 4.

 

4

 

4.3.          Reclassification.  If the Company, by reclassification of
securities or otherwise, shall change any of the securities as to which
purchase rights under this Warrant exist into the same or a different number of
securities of any other class or classes, this Warrant shall thereafter
represent the right to acquire such number and kind of securities as would have
been issuable as the result of such change with respect to the securities that
were subject to the purchase rights under this Warrant immediately prior to
such reclassification or other change and the Exercise Price therefore shall be
appropriately adjusted, all subject to further adjustment as provided in this
Section 4.  No adjustment shall be
made pursuant to this Section 4.3 upon any conversion or redemption of the
Common Stock that is the subject of Section 4.5.

 

4.4.          Adjustment for
Capital Reorganization, Merger or Consolidation.  In the case of any reclassification or change of the outstanding
securities of the Company or of any reorganization of the Company (or of any
other corporation, the stock or other securities of which are at the time
receivable on the exercise of this Warrant), after the date hereof, or in case,
after such date, the Company (or any such corporation) shall consolidate with
or merge with or into another corporation or convey its capital stock or all or
substantially all of its assets to another corporation or other entity, then,
in each such case, Holder, upon any exercise of this Warrant, at any time after
the consummation of such reclassification, change, reorganization,
consolidation, merger, or conveyance, shall be entitled to receive, in lieu of
the stock or other securities and property receivable upon the exercise of this
Warrant prior to such consummation, the stock or other securities or property
to which such Holder would have been entitled upon the consummation of such
reclassification, change, reorganization, consolidation, merger or conveyance
if Holder had exercised the Warrant immediately prior thereto, all subject to
further adjustment as provided in this Section 4, and the successor or purchasing
corporation or other entity in such reclassification, change, reorganization,
consolidation, merger or conveyance (if not the Company) shall duly execute and
deliver to Holder a supplement hereto acknowledging such corporation’s or
entity’s obligations under the Warrant; and in each such case, the terms of the
Warrant (including the exercisability, transfer and adjustment provisions of
the Warrant) shall be applicable to the shares of stock or other securities or
property receivable upon the exercise of the Warrant after the consummation of
such reclassification, change, reorganization, consolidation, merger or
conveyance.

 

4.5.          Other Events.  If any event occurs of the type contemplated
by the provisions of this Section 4, but not expressly provided for by such
provisions or definition (including, without limitation, the granting of stock
appreciation rights, phantom stock rights or other rights with equity
features), then the Company’s Board of Directors in its reasonable judgment
shall make an appropriate adjustment in the number of shares of Common Stock
obtainable upon exercise of this Warrant so as to protect the rights of the
Holder.

 

4.6.          Conversion of Common
Stock.  In case all or any portion
of the authorized and outstanding shares of Common Stock of the Company are
redeemed or converted or reclassified into other securities or property
pursuant to the Company’s Certificate of Incorporation or otherwise, or the
Common Stock otherwise ceases to exist, then, in such case, the Holder of this
Warrant, upon exercise hereof at any time after the date on which the Common
Stock is so redeemed or converted, reclassified or ceases to exist (the “Termination
Date”), shall receive, in lieu of the number of shares of Common Stock that
would have been issuable upon such exercise immediately prior to the
Termination Date, the securities or property that would have been received if
this Warrant had been exercised in full and the Common Stock received thereupon
had been simultaneously converted

 

5

 

immediately prior to the Termination Date, all subject to further
adjustment as provided in this Warrant. 
Additionally, the Exercise Price shall be immediately adjusted to equal
the quotient obtained by dividing (x) the aggregate Exercise Price of the
maximum number of shares of Common Stock for which this Warrant was exercisable
immediately prior to the Termination Date by (y) the number of shares of
Common Stock of the Company for which this Warrant is exercisable immediately
after the Termination Date, all subject to further adjustment as provided
herein.

 

5.             REPRESENTATIONS AND WARRANTIES.  The Company hereby represents and warrants
to the Holder that:  (a) the
Company has all requisite power and authority to enter into and perform its
obligations under this Warrant; (b) the execution and delivery by the
Company of this Warrant and the performance of all obligations of the Company
hereunder have been duly authorized by all necessary board and stockholder
actions; (c) all Common Stock which may be issued upon the exercise of the
purchase right represented by this Warrant shall, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable, and free of any liens
and encumbrances except for restrictions on transfer provided for herein or
under applicable federal and state securities laws; and (d) the Company is a
corporation duly organized, validly existing and in good standing under the
laws of its jurisdiction of incorporation. 
The Company’s capitalization information is set forth in Exhibit C hereto.

 

6.             CERTIFICATE AS TO ADJUSTMENTS.  In each case of any adjustment in the
Exercise Price, or number or type of shares issuable upon exercise of this
Warrant, the Chief Financial Officer or Controller of the Company shall compute
such adjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment and showing in detail the facts upon
which such adjustment is based, including a statement of the adjusted Exercise
Price.  The Company shall promptly send
(by facsimile and by either first class mail, postage prepaid or overnight
delivery) a copy of each such certificate to the Holder.

 

7.             LOSS OR MUTILATION.  Upon receipt of evidence reasonably
satisfactory to the Company of the ownership of and the loss, theft,
destruction or mutilation of this Warrant, and of indemnity reasonably
satisfactory to it (but without the requirement of a bond), and (in the case of
mutilation) upon surrender and cancellation of this Warrant, the Company will
execute and deliver in lieu thereof a new Warrant of like tenor as the lost,
stolen, destroyed or mutilated Warrant.

 

8.             RESERVATION OF COMMON STOCK.  The Company hereby covenants that at all
times there shall be reserved for issuance and delivery upon exercise of this
Warrant such number of shares of Common Stock or other shares of capital stock
of the Company as are from time to time issuable upon exercise of this Warrant
and, from time to time, will take all steps necessary to amend its Certificate
of Incorporation to provide sufficient reserves of shares of Common Stock or
other shares of capital stock issuable upon exercise of this Warrant (and
shares of its Common Stock for issuance on conversion of such capital stock).  All such shares shall be duly authorized,
and when issued upon such exercise, shall be validly issued, fully paid and
non-assessable, free and clear of all liens, security interests, charges and
other encumbrances or restrictions on sale and free and clear of all preemptive
rights, except encumbrances or restrictions arising under federal or state
securities laws.  Issuance of this
Warrant shall constitute full authority to the Company’s officers who are
charged with the duty of executing stock certificates to execute and issue the
necessary certificates for shares of Common Stock and other capital stock upon
the exercise of this Warrant.

 

6

 

9.             TRANSFER AND EXCHANGE.  Subject to compliance with all applicable
securities laws, this Warrant and all rights hereunder may be transferred,
assigned and/or pledged by the Holder with the prior written consent of the
Company, which consent may not be unreasonably withheld, to any person, in
whole or in part, except that Company consent shall not be required (i) in
the case of a Holder who is a partnership or limited liability company, to a
partner (including a limited partner) of such partnership or a member of such
limited liability company; or (ii) to any parent or subsidiary of any Holder
or parent of any Holder or any successor or permitted assignee of any Holder or
any parent of any Holder; or (iii) to any “affiliate” of a Holder (as
defined in Rule 12b-2 of the Securities Exchange Act of 1934), or (iv) to any
entity or person otherwise related organizationally to a Holder; or (v) to a
lender or a lender participant of such Holder, or to a lender or a lender
participant of an affiliate of such Holder. 
The Company will record such transfer on its books maintained for such
purpose at the principal office of the Company referred to above, upon delivery
of the form of Assignment attached hereto as Exhibit B (the “Assignment”), duly executed by
the Holder, surrender of this Warrant properly endorsed at the principal office
of the Company and payment of any necessary transfer tax or other governmental
charge imposed upon such transfer.  No
transfer may be made until and unless such transferee acknowledges and agrees
to the provisions set forth in Section 11 herein.  Upon any partial transfer, the Company will
issue and deliver to the Holder a new Warrant or Warrants with respect to the
portion of this Warrant not so transferred. 
Each taker and holder of this Warrant, by taking or holding the same,
consents and agrees that when this Warrant shall have been so endorsed, the
person in possession of this Warrant may be treated by the Company, and all
other persons dealing with this Warrant, as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented hereby,
any notice to the contrary notwithstanding; provided, however that until a
transfer of this Warrant is duly registered on the books of the Company, the
Company may treat the Holder in whose name the Warrant is registered on the
books and records maintained by the Company as the owner for all purposes.

 

10.          REGISTRATION RIGHTS AND OBLIGATIONS.

 

10.1.        Certain Definitions.  For purposes of this Section 10.1:

 

(a)           Offering.  The term “Offering”
with respect to any of the Company’s Common Stock means the Registration of
such Common Stock, whether underwritten or not, for sale to the public.

 

(b)           Person.  The term “Person”
means a corporation, an association, a trust, a partnership, a joint venture,
an organization, a business, a limited liability company, an individual, a
government or political subdivision thereof or a governmental body.

 

(c)           Registration.  The terms “register,”
“registered” and “registration” refer to a registration
effected by preparing and filing a Registration Statement in compliance with
the Act, as amended (the “Securities Act”),
and the declaration or ordering of effectiveness of such registration
statement.

 

(d)           Registrable
Securities.  The term “Registrable Securities” means (i) the
shares of Common Stock (the “Shares”) that are issuable to the Holder upon
exercise of the Warrant, and (ii) any shares of the Company’s Common Stock that
may be issued as a dividend or other distribution (including shares of the
Company’s Common Stock issued in a subdivision and split of

 

7

 

the Company’s outstanding Common Stock) with respect to, or in exchange
for, or in replacement of, shares of the Company’s Common Stock described in
clauses (i) or (ii) of this Section 10.1(d); excluding in all cases, however,
from the definition of “Registrable Securities” any such shares of the
Company’s Common Stock that are:  (w)
transferred by a person in a transaction in which rights under this Warrant
with respect to such shares of the Company’s Common Stock are not assigned in
accordance with the terms of this Warrant; (x) sold pursuant to a registration
statement filed pursuant to this Warrant; or (y) sold pursuant to Rule 144
promulgated under the Securities Act or otherwise sold to the public.  Only shares of the Company’s Common Stock
shall be Registrable Securities.  Except
as provided in clause (ii) of the first sentence of this Section 10.1(d),
without limitation, the term “Registrable Securities” does not include any
shares of the Company’s Common Stock that were not issued in connection with
the exercise of this Warrant.

 

(e)           Registration
Statement.  The term “Registration Statement” means any
registration statement which covers any of the Shares of Holder pursuant to the
provisions of this Warrant, all amendments and supplements to such Registration
Statement, including post-effective amendments, all exhibits and all material
incorporated by reference in such Registration Statement.

 

10.2.        Company’s
Obligations to Register Securities.  The
Company agrees that effective as of the first anniversary of the Effective
Date, and continuously thereafter until the Expiration Date, it will have in
place one or more effective Registration Statement(s) covering the resale of
any and all Registrable Securities issued or issuable pursuant to this Warrant
and further, that the Company will maintain the effectiveness of such
Registration Statement(s) (including without limitation, filing post-effective
amendments, appropriate qualifications under applicable blue sky or other state
securities laws, and appropriate compliance with the Securities Act) so that
any and all Registrable Securities may be sold and/or distributed pursuant to
such Registration Statement(s) from time to time and at any time beginning as
of one year following the Effective Date and ending as of the Expiration
Date.  Solely by way of explanation, and
not of limitation, the Company’s obligation to file and/or maintain the
effectiveness of such Registration Statement(s) shall be an independent and
on-going obligation, and shall continue regardless of any specific request or
notification by any Holder or any minimum number of Registrable Securities
remaining outstanding, unless or until the Holders of a majority of the
outstanding Registrable Securities shall provide a written request to the
Company that it cease maintaining the effectiveness of such Registration
Statement(s) as to the Registrable Securities covered by such request.  The Parties agree that any breach by the
Company of its obligation to register set forth in this Section 10.2 will
constitute a material breach of this Agreement, and further that upon such
breach, Holder will be entitled to seek all available remedies at law or in
equity.

 

10.3.        The Company agrees to
indemnify and hold harmless Holder and its directors, officers, employees,
agents, partners, members, controlling persons and affiliates from and against
any losses, claims, damages or liabilities they may incur arising out of any
untrue or alleged untrue statement of material fact contained in such
Registration Statement(s), or any amendment or supplement thereto, or arising
out of or based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or arising out of any violation of the Securities Act
or the Securities Exchange Act of 1934, as amended, in connection therewith,
and will reimburse Holder and its directors, officers, employees, agents,
partners, members, controlling persons and affiliates for any legal or other

 

8

 

expenses reasonably incurred in connection with investigating or
defending any such action or claim as such expenses are incurred.

 

All expenses incurred by
the Company in complying with Section 10.2 (other than the underwriter’s
discounts and commissions), including, without limitation, all registration and
filing fees (including all expenses incident to filing with the National
Association of Securities Dealers, Inc.), fees and expenses of complying with
securities and blue sky laws (except for blue sky expenses required by law to
be borne by the sellers), expense allowances of the underwriters, printing
expenses, fees and disbursements of counsel or other advisor to the Company,
and of the accountants, are herein called “Registration Expenses.” All
fees and expenses of counsel for any selling Holder and all underwriting
discounts and commissions applicable to the eligible securities covered by any
such registration, are herein called “Selling Expenses” The Company
shall pay all Registration Expenses in connection with each registration
pursuant to Section 10.2.  All Selling
Expenses and blue sky expenses required by law to be borne by sellers in
connection with each registration pursuant to Section 10.2 shall be borne by
the seller or sellers therein in proportion to the number of eligible
securities included by each in such registration or in such other proportions
as they may agree upon.

 

11.          RESTRICTIONS ON TRANSFER.  The Holder, by acceptance hereof, agrees
that, absent an effective registration statement filed with the SEC under the
Act, covering the disposition or sale of this Warrant or the Common Stock
issued or issuable upon exercise hereof or the Common Stock issuable upon
conversion thereof, as the case may be, and registration or qualification under
applicable state securities laws, such Holder will not sell, transfer, pledge,
or hypothecate any or all such Warrants or Common Stock, as the case may be, unless
either (i) the Company has received an opinion of counsel, in form and
substance reasonably satisfactory to the Company, to the effect that such
registration is not required in connection with such disposition, it being
understood and agreed that no legal opinion shall be required for transfers to
entities set forth in Section 9(i) through (v), inclusive, or (ii) the
sale of such securities is made pursuant to SEC Rule 144.

 

12.          NOTICE OF CERTAIN EVENTS.  In case of any Acquisition or of the
voluntary or involuntary dissolution, liquidation or winding up of the Company,
then in each such event the Company shall cause to be given to the Holder at
least twenty (20) days prior notice of such event.

 

13.          COMPLIANCE WITH SECURITIES LAWS.  By acceptance of this Warrant, the Holder
hereby represents, warrants and covenants that it is an “accredited investor”
as that term is defined in Regulation D promulgated under the Act, that
any shares of stock purchased upon exercise of this Warrant or acquired upon conversion
thereof shall be acquired for investment only and not with a view to, or for
sale in connection with, any distribution thereof; that the Holder has had such
opportunity as such Holder has deemed adequate to obtain from representatives
of the Company such information as is necessary to permit the Holder to
evaluate the merits and risks of its investment in the Company; that the Holder
is able to bear the economic risk of holding such shares as may be acquired
pursuant to the exercise of this Warrant for an indefinite period; that the
Holder understands that the shares of stock acquired pursuant to the exercise
of this Warrant or acquired upon conversion thereof will not be registered
under the Act (unless otherwise required pursuant to exercise by the Holder of
the registration rights, if any, previously granted to the Holder) and will be
“restricted securities” within the meaning of Rule 144 under the Act and
that the exemption from registration under Rule 144 will not be available
for at least one (1) year from the date of exercise of

 

9

 

this Warrant, subject to any special treatment by the SEC for exercise
of this Warrant pursuant to Section 2.2, and even then will not be
available unless a public market then exists for the stock, adequate
information concerning the Company is then available to the public, and other
terms and conditions of Rule 144 are complied with; and that all stock
certificates representing shares of stock issued to the Holder upon exercise of
this Warrant or upon conversion of such shares may have affixed thereto a
legend substantially in the following form:

 

THE SECURITIES
REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE ACT, AS AMENDED, OR UNDER
THE SECURITIES LAWS OF ANY STATE.  THESE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY
NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM.  INVESTORS SHOULD BE AWARE
THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME.  THE ISSUER
OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE
IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

 

14.          NO RIGHTS OR LIABILITIES AS STOCKHOLDERS.  This Warrant shall not entitle the Holder to
any voting rights or other rights as a stockholder of the Company.  In the absence of affirmative action by such
Holder to purchase Common Stock by exercise of this Warrant, no provisions of
this Warrant, and no enumeration herein of the rights or privileges of the
Holder hereof shall cause such Holder hereof to be a stockholder of the Company
for any purpose.

 

15.          NOTICES. 
All notices and other communications required or permitted hereunder
shall be in writing and shall be mailed by registered or certified mail,
postage prepaid, return receipt requested, or by telecopier, or by email or
otherwise delivered by hand or by messenger, addressed or telecopied to the
person to whom such notice or communication is being given at its address set
forth after its signature hereto.  In
order to be effective, a copy of any notice or communication sent by telecopier
or email must be sent by registered or certified mail, postage prepaid, return
receipt requested, or delivered personally to the person to whom such notice or
communication is being at its address set forth after its signature
hereto.  If notice is provided by mail,
notice shall be deemed to be given five (5) business days after proper
deposit with the United States mail or nationally recognized overnight courier,
or immediately upon personally delivery thereof, to person to whom such notice
or communication is being at such address. 
If notice is provided by telecopier, notice shall be deemed to be given
upon confirmation by the telecopier machine of the receipt of such notice at the
telecopier number provided above.  If notice
is provided by email, notice shall be deemed to be given upon confirmation by
the sender’s email program of the receipt of such notice at the email address
provided after the signature of the person to whom such notice or communication
is being.  The addresses set forth after
the signatures hereto may be changed by written notice complying with the terms
of this Section 15.

 

16.          HEADINGS. 
The headings in this Warrant are for purposes of convenience in
reference only, and shall not be deemed to constitute a part hereof.

 

10

 

17.          LAW GOVERNING.  This Warrant shall be construed and enforced in accordance with,
and governed by, the laws of the State of California.

 

18.          NO IMPAIRMENT.  The Company will not, by amendment of its Certificate of
Incorporation or bylaws, or through reorganization, consolidation, merger,
dissolution, issue or sale of securities, sale of assets or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the
terms of this Warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Holder of this
Warrant against impairment.  Without
limiting the generality of the foregoing, the Company (a) will not
increase the par value of any shares of stock issuable upon the exercise of
this Warrant above the amount payable therefor upon such exercise, and
(b) will take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and non-assessable
shares of Common Stock upon exercise of this Warrant.

 

19.          NOTICES OF RECORD DATE.  In case:

 

19.1.        the Company shall take a
record of the holders of its Common Stock (or other stock or securities at the
time receivable upon the exercise of this Warrant), for the purpose of
entitling them to receive any dividend or other distribution, or any right to
subscribe for or purchase any shares of stock of any class or any other
securities or to receive any other right; or

 

19.2.        of any consolidation or
merger of the Company with or into another corporation, any capital
reorganization of the Company, any reclassification of the capital stock of the
Company, or any conveyance of all or substantially all of the assets of the
Company to another corporation in which holders of the Company’s stock are to
receive stock, securities or property of another corporation; or

 

19.3.        of any voluntary dissolution,
liquidation or winding-up of the Company;

 

19.4.        of any redemption of any
outstanding capital stock of the Company; or

 

19.5.        of any registration of the
Company’s Common Stock under applicable securities laws or of the filing of a
registration statement relating thereto;

 

then, and in each such
case, the Company will mail or cause to be mailed to the Holder of this Warrant
a notice specifying, as the case may be, (i) the date on which a record is
to be taken for the purpose of such dividend, distribution or right, or
(ii) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation, winding-up,
redemption or conversion is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such stock or securities
as at the time are receivable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding-up. 
Such notice shall be delivered at least thirty (30) days prior to
the date therein specified.

 

20.          SEVERABILITY.  If any term, provision, covenant or restriction of this Warrant
is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms,

 

11

 

provisions, covenants and restrictions of this Warrant shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.

 

21.          COUNTERPARTS.  For the convenience of the parties, any number of counterparts of
this Warrant may be executed by the parties hereto and each such executed
counterpart shall be, and shall be deemed to be, an original instrument.

 

22.          NO INCONSISTENT AGREEMENTS.  The Company will not on or after the date of
this Warrant enter into any agreement with respect to its securities which is
inconsistent with the rights granted to the Holder of this Warrant or otherwise
conflicts with the provisions hereof. 
The rights granted to the Holder hereunder do not in any way conflict
with and are not inconsistent with the rights granted to holders of the Company’s
securities under any other agreements, except rights that have been waived.

 

23.          SATURDAYS, SUNDAYS AND HOLIDAYS.  If the Expiration Date falls on a Saturday,
Sunday or legal holiday, the Expiration Date shall automatically be extended
until 5:00 p.m. on the next business day.

 

12

 

IN
WITNESS WHEREOF, the parties hereto have executed this
Warrant as of the Effective as of July 7, 2004.

 

 

	
  BROADVISION,
  INC., a Delaware

  corporation

  	
   

  	
  PACIFIC
  SHORES INVESTORS, LLC, a

  Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Pehong Chen

  	
   

  	
  By: Pacific Shores
  Mezzanine, LLC, a Delaware

  
	
  Name:

  	
  Pehong Chen

  	
   

  	
  limited liability
  company, its sole member

  
	
  Title:

  	
  Chairman, CEO &
  President

  	
   

  	
   

  
	
   

  	
   

  	
  By: Pacific Shores
  Junior Mezz, LLC, a

  Delaware limited liability company, its sole

  member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: Pacific Shores
  Junior Mezz Managers, LLC,

  a Delaware limited liability company, its sole

  member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: Pacific Shores
  Development, LLC, a

  Delaware limited liability company, its sole

  member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: Technology Land
  LLC, a California limited

  liability company, Operating Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Joseph K. Paul

  
	
   

  	
   

  	
  Name:  Joseph K. Paul

  
	
   

  	
   

  	
  Title:  Sole Managing Member

  
	
   

  	
   

  	
   

  
	
  Address for Notices:

  	
   

  	
  Address for Notices:

  
	
   

  	
   

  	
   

  
	
  BroadVision, Inc.

  	
   

  	
  Pacific Shores
  Investors, LLC

  
	
  585 Broadway

  	
   

  	
  c/o Paul Holdings, Inc.

  
	
  Redwood City,
  California 94063

  	
   

  	
  350 California Street,
  Suite 1905

  
	
  Attention:  Legal Department

  	
   

  	
  San Francisco,
  California 94111-4074

  
	
  Telephone:
  (650) 261-5100

  	
   

  	
  Attention:  Mr. Jay Paul

  
	
  Facsimile:  (650) 298-7440

  	
   

  	
  Telephone:
  (415) 263.7400

  
	
   

  	
   

  	
  Facsimile:  (415) 362.0698

  
							

 

13

 

EXHIBIT A

 

NOTICE OF EXERCISE

 

(To be executed upon exercise of Warrant)

 

	
   

  	
   

  	
  WARRANT
  NO.         

  

 

The undersigned hereby irrevocably
elects to exercise the right of purchase represented by the within Warrant
Certificate for, and to purchase thereunder, the securities of BroadVision,
Inc. by tendering herewith payment of the exercise price in full in the form of
cash, a certified or official bank check in same-day funds, or cancellation of
indebtedness in the amount of
$                        
for                   
such securities.

 

Please issue a
certificate or certificates for such securities in the name of, and pay any cash
for any fractional share to (please print name, address and social security
number):

 

	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  

 

Note:  The above signature should correspond
exactly with the name on the first page of this Warrant Certificate or with the
name of the assignee appearing in the assignment form below.

 

If said number of shares
shall not be all the shares purchasable under the within Warrant Certificate, a
new Warrant Certificate is to be issued in the name of said undersigned for the
balance remaining of the shares purchasable thereunder rounded up to the next
higher whole number of shares.

 

1

 

EXHIBIT B

 

ASSIGNMENT

 

	
  (To be
  executed only upon assignment of Warrant Certificate)

  	
   

  	
  WARRANT
  NO.         

  

 

For value received, hereby sells, assigns and transfers unto
                                                
the within Warrant Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint                                                         
attorney, to transfer said Warrant Certificate on the books of the within-named
Company with respect to the number of Warrants set forth below, with full power
of substitution in the premises:

 

	
  Name(s) of Assignee(s)

  	
   

  	
  Address

  	
   

  	
  # of
  Warrants

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

And if said number of Warrants shall not be all the Warrants
represented by the Warrant Certificate, a new Warrant Certificate is to be
issued in the name of said undersigned for the balance remaining of the
Warrants registered by said Warrant Certificate.

 

	
  Dated:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  

 

Notice:  The signature to the foregoing Assignment
must correspond to the name as written upon the face of this security in every
particular, without alteration or any change whatsoever; signature(s) must be
guaranteed by an eligible guarantor institution (banks, stock brokers, savings
and loan associations and credit unions with membership in an approved
signature guarantee medallion program) pursuant to Securities and Exchange
Commission Rule 17Ad-15.

 

1

 

EXHIBIT
C

 

COMPANY
CAPITALIZATION INFORMATION

 

BroadVision, Inc. has two classes of shares authorized: 2,000,000,000
shares of common stock, $.00001 par value per share, of which 33,602,320 shares
were issued and outstanding as of the close of business on August 4, 2004; and
10,000,000 shares of preferred stock, $.00001 par value per share, of which no
shares are outstanding.

 

As of June 30, 2004, there were 10,661,111 shares of common stock
reserved for issuance under all of the company’s stock option plans, of which
5,824,643 were reserved for issuance under options outstanding as of that date.

 

As of June 30, 2004, there were 892,230 shares of common stock reserved
for future issuance under BroadVision’s employee stock purchase plan.

 

As of December 31, 2003, there were warrants outstanding to acquire
9,628 shares of common stock at an average price of $188 per share.  These warrants were issued in 1997 and 2000
in connection with revenue transactions.

 

1

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