UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549
	SCHEDULE 13D/A

 

Under the Securities Exchange Act of 1934
(Amendment No. 8)*

 

(Name of Issuer)

 

(Title of Class of Securities)

 

(CUSIP Number)

 

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

 

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. x

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 

* Includes 416,184 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 401,508 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.  Also includes 46,355 shares held in certain accounts advised by Trigran Investments, Inc.  The reporting person may be deemed a beneficial owner of these 46,355 shares for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3(a) thereunder; however, the reporting person has no pecuniary interest in such shares.

 

2

 

 

* Includes 261,780 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 253,753 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.

 

3

 

 

* Includes 154,404 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 147,755 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.

 

4

 

 

* Includes 416,184 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 401,508 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.  Also includes 46,355 shares held in certain accounts advised by Trigran Investments, Inc.  The reporting person may be deemed a beneficial owner of these 46,355 shares for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3(a) thereunder; however, the reporting person has no pecuniary interest in such shares.

 

5

 

 

* Includes 416,184 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 401,508 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.  Also includes 46,355 shares held in certain accounts advised by Trigran Investments, Inc.  The reporting person may be deemed a beneficial owner of these 46,355 shares for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3(a) thereunder; however, the reporting person has no pecuniary interest in such shares.

 

6

 

 

* Includes 416,184 shares underlying presently exercisable Warrants described in Item 4 of Amendment 6 to this Schedule 13D and 401,508 shares of Common Stock underlying presently exercisable Warrants described in Item 4 of Amendment 7 to this Schedule 13D.  Also includes 46,355 shares held in certain accounts advised by Trigran Investments, Inc.  The reporting person may be deemed a beneficial owner of these 46,355 shares for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3(a) thereunder; however, the reporting person has no pecuniary interest in such shares.

 

7

 

 

This Amended Statement of Beneficial Ownership on Schedule 13D (“Amendment 8”) amends the Amended Statement of Beneficial Ownership on Schedule 13D filed on April 12, 2013 (“Amendment 7”), and all previous Statements of Beneficial Ownership on Schedule 13D filed in connection with the parties and matters referenced herein, with respect to the common stock (the “Common Stock”) of Scientific Learning Corporation, Inc. (the “Issuer”).  Any capitalized terms used and not defined in this Amendment 8 shall have the meanings set forth in Amendment 7, previous amendments and/or the original Schedule 13D to which this Amendment 8 relates.  Only those items that are hereby reported are amended; all other items, including previously filed exhibits, remain unchanged and are incorporated by reference herein.

 

Item 4.   Purpose of Transaction

 

On December 31, 2013, in private transactions, Trigran Investments, L.P. sold 643,000 shares of Common Stock at a price of $0.15 per share for a total sale price of $96,450, and Trigran Investments, L.P. II sold 357,000 shares of Common Stock at a price of $0.15 per share for a total sale price of $53,550.  The sales were made pursuant to four separate Stock Purchase and Sale Agreements (each an “Agreement” and, collectively, the “Agreements”) between Trigran Investments, L.P. and Trigran Investments, L.P. II as sellers, and Nantahala Capital Partners, Limited Partnership (“Nantahala”); Nantahala Capital Partners II, Limited Partnership (“Nantahala II”); Blackwell Partners LLC (“Blackwell”); and Silver Creek CS SAV, LLC (“Silver Creek”), respectively, as buyers.

 

Specifically, Trigran Investments, L.P. sold 132,160 shares of Common Stock and Trigran Investments, L.P. II sold 73,376 shares of Common Stock to Nantahala; Trigran Investments, L.P. sold 197,626 shares of Common Stock and Trigran Investments, L.P. II sold 109,725 shares of Common Stock to Nantahala II; Trigran Investments, L.P. sold 219,169 shares of Common Stock and Trigran Investments, L.P. II sold 121,685 shares of Common Stock to Blackwell; and Trigran Investments, L.P. sold 94,045 shares of Common Stock and Trigran Investments, L.P. II sold 52,214 shares of Common Stock to Silver Creek.  The transactions were effected in the ordinary course of the reporting persons’ investment activities and not with any purpose of, or with the effect of, changing or influencing the control of the Issuer, or in connection with or as a participant in any transaction having that purpose or effect.

 

The foregoing description of the terms of the transactions is a summary only and is qualified in its entirety by the terms of the Agreements, copies of which are attached hereto as Exhibits 99.2 — 99.5 (see Item 7, below).

 

Item 5.   Interest in Securities of the Issuer

 

(a)-(b)     Incorporated by reference to Items (7) - (11) and (13) of the cover page relating to each reporting person and the disclosure set forth in Item 4 of this Amendment 7.

 

(c)           Other than the matters referred to herein, there have been no other transactions in the Common Stock by the reporting persons in the sixty days preceding the date of this filing.

 

(d)           Owners of certain accounts managed by Trigran Investments, Inc. have or may have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, securities of the Issuer held in their accounts. No such account has such power with respect to more than five percent of the class of securities to which this Schedule 13D relates.

 

(e)           Not applicable.

 

Item 6.   Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

 

The matters set forth in Items 4 and 5 and the exhibits to this Amendment 8 to Schedule 13D, and all previous Statements of Beneficial Ownership on Schedule 13D filed in connection with the parties and matters referenced herein (including exhibits), are incorporated in this Item 6 by reference as if fully set forth herein.  Except for the matters discussed in this Amendment 8, in previous amendments and/or the original Schedule 13D to which this Amendment 8 relates, and any exhibits thereto, there are no contracts, arrangements, understandings or relationships with respect to securities of the Issuer.

 

Item 7.   Material to be Filed as Exhibits

 

Exhibit 99.1 — Joint Filing Agreement

Exhibit 99.2 — Stock Purchase and Sale Agreement dated December 31, 2013, between Trigran Investments, L.P., Trigran Investments, L.P. II and Nantahala Capital Partners, Limited Partnership.

Exhibit 99.3 — Stock Purchase and Sale Agreement dated December 31, 2013, between Trigran Investments, L.P., Trigran Investments, L.P. II and Nantahala Capital Partners II, Limited Partnership.

Exhibit 99.4 — Stock Purchase and Sale Agreement dated December 31, 2013, between Trigran Investments, L.P., Trigran Investments, L.P. II and Blackwell Partners LLC.

Exhibit 99.5 — Stock Purchase and Sale Agreement dated December 31, 2013, between Trigran Investments, L.P., Trigran Investments, L.P. II and Silver Creek CS SAV, LLC.

 

8

 

 

Signature

 

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

 

Dated this 2nd day of January, 2014

 

TRIGRAN INVESTMENTS, INC.
/s/ Lawrence A. Oberman
Lawrence A. Oberman
Executive Vice President and Director
TRIGRAN INVESTMENTS, L.P.
/s/ Lawrence A. Oberman
Lawrence A. Oberman
Executive Vice President and Director of Trigran Investments, Inc., the General Partner of Trigran Investments, L.P
TRIGRAN INVESTMENTS, L.P. II
/s/ Lawrence A. Oberman
Lawrence A. Oberman
Executive Vice President and Director of Trigran Investments, Inc., the General Partner of Trigran Investments, L.P II
/s/ Lawrence A. Oberman
Lawrence A. Oberman
/s/ Douglas Granat
Douglas Granat
/s/ Steven G. Simon
Steven G. Simon

 

9

Exhibit 99.1

 

JOINT FILING AGREEMENT

 

January 2, 2014

 

In accordance with Rule 13d-1(k)(1) under the Securities Exchange Act of 1934, as amended, TRIGRAN INVESTMENTS, INC., TRIGRAN INVESTMENTS, L.P., TRIGRAN INVESTMENTS, L.P. II, DOUGLAS GRANAT, LAWRENCE A. OBERMAN and STEVEN G. SIMON each hereby agree to the joint filing of this statement on Schedule 13D (including any and all amendments hereto).  In addition, each party to this Agreement expressly authorizes each other party to this Agreement to file on its behalf any and all amendments to such Statement on Schedule 13D. A copy of this Agreement shall be attached as an exhibit to the Statement on Schedule 13D filed on behalf of each of the parties hereto, to which this Agreement relates.

 

This Agreement may be executed in multiple counterparts, each of which shall constitute an original, one and the same instrument.

 

TRIGRAN INVESTMENTS, INC.
By:	/s/ Lawrence A. Oberman
	Name: Lawrence A. Oberman
	Title: Executive Vice President and Director
TRIGRAN INVESTMENTS, L.P.
By:	/s/ Lawrence A. Oberman
	Name: Lawrence A. Oberman
	Title: Executive Vice President and Director of Trigran Investments, Inc., the General Partner of Trigran Investments, L.P.
TRIGRAN INVESTMENTS, L.P. II
By:	/s/ Lawrence A. Oberman
	Name: Lawrence A. Oberman
	Title: Executive Vice President and Director of Trigran Investments, Inc., the General Partner of Trigran Investments, L.P. II
DOUGLAS GRANAT
/s/ Douglas Grant
LAWRENCE A. OBERMAN
/s/ Lawrence A. Oberman
STEVEN G. SIMON
/s/ Steven G. Simon

 

Exhibit 99.2

 

STOCK PURCHASE AND

SALE AGREEMENT

 

THIS STOCK PURCHASE AND SALE AGREEMENT (this “Agreement”), dated as of December 31, 2013, is entered into by and among Nantahala Capital Partners Limited Partnership ( “Buyer”), Trigran Investments, L.P., an Illinois limited partnership (“Trigran”), and Trigran Investments, L.P. II, an Illinois limited partnership (“Trigran II”, and together with Trigran, “Sellers”).

 

WHEREAS, Trigran currently owns 132,160 shares (the “Trigran Shares”) of common stock]of Scientific Learning Corporation, a Delaware corporation (“SCIL”), which to Sellers’ knowledge represent 0.56% of the total issued and outstanding shares of the capital stock of SCIL;

 

WHEREAS, Trigran II currently owns 73,376 shares (the “Trigran II Shares”, and together with the Trigran Shares, the “Shares”) of common stock of SCIL, which to Sellers’ knowledge represent 0.31% of the total issued and outstanding shares of the capital stock of SCIL; and

 

WHEREAS, Buyer desires to purchase from Sellers and Sellers desire to sell to Buyer the Shares, on the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, the parties agree as follows:

 

1. Purchase and Sale of Shares.

 

1.1 Trigran Shares. Effective as of December 31, 2013 (the “Effective Date”), Buyer does hereby purchase from Trigran, and Trigran does hereby sell to Buyer, the Trigran Shares, for an aggregate purchase price of $19,824.00(the “Trigran Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein. The Trigran Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares,  no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran.  The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

1.2 Trigran II Shares. Effective as of the Effective Date, Buyer does hereby purchase from Trigran II, and Trigran II does hereby sell to Buyer, the Trigran II Shares, for an aggregate purchase price of $11,006.40 (the “Trigran II Purchase Price”, and in addition to the Trigran Purchase Price, the “Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein (the purchases and sales contemplated in  Sections 1.1 and 1.2, the “Transactions”). The Trigran II Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares, no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran II. The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

2. Representations and Warranties.

 

2.1 Representations and Warranties of Sellers. Sellers hereby make each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Sellers have full legal right, power and authority, without the consent of any other natural person, corporation, business trust, trust, estate, partnership, limited partnership, limited liability company, limited liability partnership, association, joint venture, or other entity (each a “Person”), to execute and deliver

 

 

this Agreement, and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Sellers, enforceable against the Sellers in accordance with its terms.

 

(b) Sellers are the sole record and beneficial holders of the Shares, and hold the Shares as principals, and have not entered into any agreement with any third party with respect to the ownership of the Shares or any sharing, splitting, or delegation of any of the rights represented thereby. Sellers own the Shares free and clear of all liens and encumbrances.

 

2.2 Representations and Warranties of Buyer. Buyer hereby makes each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Buyer has full legal right, power and authority, without the consent of any other Person, to execute and deliver this Agreement and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with its terms.

 

(b) Buyer has received and carefully reviewed the last reported Annual Report of SCIL on Form 10-K and all subsequent public filings of SCIL with the Securities and Exchange Commission, other publicly available information regarding SCIL, and such other information that it and its advisers deem necessary to make its decision to enter into the Transactions.

 

(c) Buyer has made its own decision to consummate the Transactions based on its own independent review and consultations with such investment, legal, tax, accounting and other advisers as it deemed necessary. Buyer has made its own decision concerning the Transactions without reliance on any representation or warranty of, or advice from, Sellers.

 

(d) Buyer acknowledges and understands that Sellers and their partners, agents and affiliates, as defined in Rule 405 under the Securities Act including any past and present affiliate (“Affiliates”), may possess certain information, possibly including material and/or immaterial nonpublic information, not known to Buyer that may impact the value of the Shares (the “Information”). Buyer understands, based on its own experience, the potential disadvantage to which Buyer may be subject due to any possible disparity of information between Buyer and Sellers.  Notwithstanding this, Buyer has deemed it appropriate to engage in the Transactions.  Moreover, Buyer undertakes and agrees that it will not initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, induce or encourage any other person or entity to initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, or assist any other person or entity in the initiation or maintenance of any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information (unless such assistance is compelled by valid legal process).

 

(e) Buyer agrees that Sellers shall have no liability to Buyer whatsoever due to or in connection with Sellers’ use or non-disclosure of the Information, and Buyer hereby irrevocably waives any claim that it might have based on the failure of the Sellers to disclose the Information.

 

(f) Buyer acknowledges and agrees that Sellers are relying on Buyer’s representations, warranties and agreements herein as a condition to proceeding with the Transactions.

 

3. Further Assurances. If at any time after the date hereof, Buyer or Sellers shall consider or be advised that any further documents, assignments or assurances in law or in any other things are necessary, desirable or proper to vest, perfect or confirm, of record or otherwise, in Buyer, the title to the Shares, then Sellers and/or Buyer, as the case may be, shall execute and deliver all such proper assignments and assurances in law and do all things necessary, desirable or proper to vest, perfect or confirm title to such property or rights and otherwise to carry out the purpose of this Agreement.

 

 

4. Miscellaneous.

 

4.1 Governing Law. This Agreement shall be governed in all respects by the laws of the State of Illinois, without regard to any provisions thereof relating to choice of law or conflicts of laws among different jurisdictions.

 

4.2 Successors and Assigns. Except as otherwise provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto. This Agreement shall not be construed so as to confer any right or benefit on any party not a party hereto, other than said respective successors, assigns, heirs, executors and administrators.

 

4.3 Entire Agreement; Amendment. This Agreement and the other documents referenced herein and delivered pursuant hereto constitute the full and entire understanding and agreement among the parties with regard to the subject matter hereof and supersede all prior agreements and understandings relating thereto. Neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

 

4.4 Notices, Etc. All notices under this Agreement shall be sufficiently given for all purposes if made in writing and delivered personally, or, to the extent receipt by the other party hereunder is confirmed, sent by documented overnight delivery service facsimile or other electronic transmission.

 

4.5 Expenses. Buyer and Sellers shall each bear their respective expenses and legal fees incurred on their own behalf with respect to this Agreement and the transactions contemplated hereby.

 

4.6 Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall constitute one instrument.

 

4.7 Enforcement. The parties hereto agree that irreparable damage for which money damages would not be an adequate remedy would occur in the event that any of the provision of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that, in addition to any other remedies a party may have at law or equity, the parties shall be entitled to seek an injunction or injunctions to prevent such breach of this Agreement and to enforce specifically the terms hereof.

 

Signature page follows.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

 

	BUYER:
	NANTAHALA CAPITAL PARTNERS, LIMITED PARTNERSHIP
	By:	Nantahala Capital Management, LLC
		Its General Partner
	By:	/s/ Daniel Mack
		Name: Daniel Mack
		Title: Manager
	Trigran Investments, L.P.:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.
	Trigran Investments, L.P. II:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.

 

Exhibit 99.3

 

STOCK PURCHASE AND

SALE AGREEMENT

 

THIS STOCK PURCHASE AND SALE AGREEMENT (this “Agreement”), dated as of December 31, 2013, is entered into by and among Nantahala Capital Partners II, Limited Partnership ( “Buyer”), Trigran Investments, L.P., an Illinois limited partnership (“Trigran”), and Trigran Investments, L.P. II, an Illinois limited partnership (“Trigran II”, and together with Trigran, “Sellers”).

 

WHEREAS, Trigran currently owns 197,626 shares (the “Trigran Shares”) of common stock of Scientific Learning Corporation, a Delaware corporation (“SCIL”), which to Sellers’ knowledge represent 0.83% of the total issued and outstanding shares of the capital stock of SCIL;

 

WHEREAS, Trigran II currently owns 109,725 shares (the “Trigran II Shares”, and together with the Trigran Shares, the “Shares”) of common stock of SCIL, which to Sellers’ knowledge represent 0.46% of the total issued and outstanding shares of the capital stock of SCIL; and

 

WHEREAS, Buyer desires to purchase from Sellers and Sellers desire to sell to Buyer the Shares, on the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, the parties agree as follows:

 

1. Purchase and Sale of Shares.

 

1.1 Trigran Shares. Effective as of December 31, 2013 (the “Effective Date”), Buyer does hereby purchase from Trigran, and Trigran does hereby sell to Buyer, the Trigran Shares, for an aggregate purchase price of $29,643.90 (the “Trigran Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein. The Trigran Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares,  no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran.  The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

1.2 Trigran II Shares. Effective as of the Effective Date, Buyer does hereby purchase from Trigran II, and Trigran II does hereby sell to Buyer, the Trigran II Shares, for an aggregate purchase price of $16,458.75(the “Trigran II Purchase Price”, and in addition to the Trigran Purchase Price, the “Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein (the purchases and sales contemplated in  Sections 1.1 and 1.2, the “Transactions”). The Trigran II Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares, no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran II. The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

2. Representations and Warranties.

 

2.1 Representations and Warranties of Sellers. Sellers hereby make each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Sellers have full legal right, power and authority, without the consent of any other natural person, corporation, business trust, trust, estate, partnership, limited partnership, limited liability company, limited liability partnership, association, joint venture, or other entity (each a “Person”), to execute and deliver

 

 

this Agreement, and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Sellers, enforceable against the Sellers in accordance with its terms.

 

(b) Sellers are the sole record and beneficial holders of the Shares, and hold the Shares as principals, and have not entered into any agreement with any third party with respect to the ownership of the Shares or any sharing, splitting, or delegation of any of the rights represented thereby. Sellers own the Shares free and clear of all liens and encumbrances.

 

2.2 Representations and Warranties of Buyer. Buyer hereby makes each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Buyer has full legal right, power and authority, without the consent of any other Person, to execute and deliver this Agreement and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with its terms.

 

(b) Buyer has received and carefully reviewed the last reported Annual Report of SCIL on Form 10-K and all subsequent public filings of SCIL with the Securities and Exchange Commission, other publicly available information regarding SCIL, and such other information that it and its advisers deem necessary to make its decision to enter into the Transactions.

 

(c) Buyer has made its own decision to consummate the Transactions based on its own independent review and consultations with such investment, legal, tax, accounting and other advisers as it deemed necessary. Buyer has made its own decision concerning the Transactions without reliance on any representation or warranty of, or advice from, Sellers.

 

(d) Buyer acknowledges and understands that Sellers and their partners, agents and affiliates, as defined in Rule 405 under the Securities Act including any past and present affiliate (“Affiliates”), may possess certain information, possibly including material and/or immaterial nonpublic information, not known to Buyer that may impact the value of the Shares (the “Information”). Buyer understands, based on its own experience, the potential disadvantage to which Buyer may be subject due to any possible disparity of information between Buyer and Sellers.  Notwithstanding this, Buyer has deemed it appropriate to engage in the Transactions.  Moreover, Buyer undertakes and agrees that it will not initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, induce or encourage any other person or entity to initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, or assist any other person or entity in the initiation or maintenance of any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information (unless such assistance is compelled by valid legal process).

 

(e) Buyer agrees that Sellers shall have no liability to Buyer whatsoever due to or in connection with Sellers’ use or non-disclosure of the Information, and Buyer hereby irrevocably waives any claim that it might have based on the failure of the Sellers to disclose the Information.

 

(f) Buyer acknowledges and agrees that Sellers are relying on Buyer’s representations, warranties and agreements herein as a condition to proceeding with the Transactions.

 

3. Further Assurances. If at any time after the date hereof, Buyer or Sellers shall consider or be advised that any further documents, assignments or assurances in law or in any other things are necessary, desirable or proper to vest, perfect or confirm, of record or otherwise, in Buyer, the title to the Shares, then Sellers and/or Buyer, as the case may be, shall execute and deliver all such proper assignments and assurances in law and do all things necessary, desirable or proper to vest, perfect or confirm title to such property or rights and otherwise to carry out the purpose of this Agreement.

 

 

4. Miscellaneous.

 

4.1 Governing Law. This Agreement shall be governed in all respects by the laws of the State of Illinois, without regard to any provisions thereof relating to choice of law or conflicts of laws among different jurisdictions.

 

4.2 Successors and Assigns. Except as otherwise provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto. This Agreement shall not be construed so as to confer any right or benefit on any party not a party hereto, other than said respective successors, assigns, heirs, executors and administrators.

 

4.3 Entire Agreement; Amendment. This Agreement and the other documents referenced herein and delivered pursuant hereto constitute the full and entire understanding and agreement among the parties with regard to the subject matter hereof and supersede all prior agreements and understandings relating thereto. Neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

 

4.4 Notices, Etc. All notices under this Agreement shall be sufficiently given for all purposes if made in writing and delivered personally, or, to the extent receipt by the other party hereunder is confirmed, sent by documented overnight delivery service facsimile or other electronic transmission.

 

4.5 Expenses. Buyer and Sellers shall each bear their respective expenses and legal fees incurred on their own behalf with respect to this Agreement and the transactions contemplated hereby.

 

4.6 Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall constitute one instrument.

 

4.7 Enforcement. The parties hereto agree that irreparable damage for which money damages would not be an adequate remedy would occur in the event that any of the provision of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that, in addition to any other remedies a party may have at law or equity, the parties shall be entitled to seek an injunction or injunctions to prevent such breach of this Agreement and to enforce specifically the terms hereof.

 

Signature page follows.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

 

	BUYER:
	NANTAHALA CAPITAL PARTNERS II, LIMITED PARTNERSHIP
	By: Nantahala Capital Management, LLC
	Its General Partner
	By:	/s/ Daniel Mack
		Name: Daniel Mack
		Title: Manager
	Trigran Investments, L.P.:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.
	Trigran Investments, L.P. II:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.

 

Exhibit 99.4

 

STOCK PURCHASE AND

SALE AGREEMENT

 

THIS STOCK PURCHASE AND SALE AGREEMENT (this “Agreement”), dated as of December 31, 2013, is entered into by and among Blackwell Partners LLC ( “Buyer”), Trigran Investments, L.P., an Illinois limited partnership (“Trigran”), and Trigran Investments, L.P. II, an Illinois limited partnership (“Trigran II”, and together with Trigran, “Sellers”).

 

WHEREAS, Trigran currently owns 219,169 shares (the “Trigran Shares”) of common stock of Scientific Learning Corporation, a Delaware corporation (“SCIL”), which to Sellers’ knowledge represent 0.92% of the total issued and outstanding shares of the capital stock of SCIL;

 

WHEREAS, Trigran II currently owns 121,685 shares (the “Trigran II Shares”, and together with the Trigran Shares, the “Shares”) of common stock of SCIL, which to Sellers’ knowledge represent 0.51% of the total issued and outstanding shares of the capital stock of SCIL; ad

 

WHEREAS, Buyer desires to purchase from Sellers and Sellers desire to sell to Buyer the Shares, on the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, the parties agree as follows:

 

1. Purchase and Sale of Shares.

 

1.1 Trigran Shares. Effective as of December 31, 2013 (the “Effective Date”), Buyer does hereby purchase from Trigran, and Trigran does hereby sell to Buyer, the Trigran Shares, for an aggregate purchase price of $32,875.35 (the “Trigran Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein. The Trigran Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares,  no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran.  The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

1.2 Trigran II Shares. Effective as of the Effective Date, Buyer does hereby purchase from Trigran II, and Trigran II does hereby sell to Buyer, the Trigran II Shares, for an aggregate purchase price of $18,252.75 (the “Trigran II Purchase Price”, and in addition to the Trigran Purchase Price, the “Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein (the purchases and sales contemplated in Sections 1.1 and 1.2, the “Transactions”). The Trigran II Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares, no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran II. The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

2. Representations and Warranties.

 

2.1 Representations and Warranties of Sellers. Sellers hereby make each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Sellers have full legal right, power and authority, without the consent of any other natural person, corporation, business trust, trust, estate, partnership, limited partnership, limited liability company, limited liability partnership, association, joint venture, or other entity (each a “Person”), to execute and deliver

 

 

this Agreement, and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Sellers, enforceable against the Sellers in accordance with its terms.

 

(b) Sellers are the sole record and beneficial holders of the Shares, and hold the Shares as principals, and have not entered into any agreement with any third party with respect to the ownership of the Shares or any sharing, splitting, or delegation of any of the rights represented thereby. Sellers own the Shares free and clear of all liens and encumbrances.

 

2.2 Representations and Warranties of Buyer. Buyer hereby makes each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Buyer has full legal right, power and authority, without the consent of any other Person, to execute and deliver this Agreement and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with its terms.

 

(b) Buyer has received and carefully reviewed the last reported Annual Report of SCIL on Form 10-K and all subsequent public filings of SCIL with the Securities and Exchange Commission, other publicly available information regarding SCIL, and such other information that it and its advisers deem necessary to make its decision to enter into the Transactions.

 

(c) Buyer has made its own decision to consummate the Transactions based on its own independent review and consultations with such investment, legal, tax, accounting and other advisers as it deemed necessary. Buyer has made its own decision concerning the Transactions without reliance on any representation or warranty of, or advice from, Sellers.

 

(d) Buyer acknowledges and understands that Sellers and their partners, agents and affiliates, as defined in Rule 405 under the Securities Act including any past and present affiliate (“Affiliates”), may possess certain information, possibly including material and/or immaterial nonpublic information, not known to Buyer that may impact the value of the Shares (the “Information”). Buyer understands, based on its own experience, the potential disadvantage to which Buyer may be subject due to any possible disparity of information between Buyer and Sellers.  Notwithstanding this, Buyer has deemed it appropriate to engage in the Transactions.  Moreover, Buyer undertakes and agrees that it will not initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, induce or encourage any other person or entity to initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, or assist any other person or entity in the initiation or maintenance of any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information (unless such assistance is compelled by valid legal process).

 

(e) Buyer agrees that Sellers shall have no liability to Buyer whatsoever due to or in connection with Sellers’ use or non-disclosure of the Information, and Buyer hereby irrevocably waives any claim that it might have based on the failure of the Sellers to disclose the Information.

 

(f) Buyer acknowledges and agrees that Sellers are relying on Buyer’s representations, warranties and agreements herein as a condition to proceeding with the Transactions.

 

3. Further Assurances. If at any time after the date hereof, Buyer or Sellers shall consider or be advised that any further documents, assignments or assurances in law or in any other things are necessary, desirable or proper to vest, perfect or confirm, of record or otherwise, in Buyer, the title to the Shares, then Sellers and/or Buyer, as the case may be, shall execute and deliver all such proper assignments and assurances in law and do all things necessary, desirable or proper to vest, perfect or confirm title to such property or rights and otherwise to carry out the purpose of this Agreement.

 

 

4. Miscellaneous.

 

4.1 Governing Law. This Agreement shall be governed in all respects by the laws of the State of Illinois, without regard to any provisions thereof relating to choice of law or conflicts of laws among different jurisdictions.

 

4.2 Successors and Assigns. Except as otherwise provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto. This Agreement shall not be construed so as to confer any right or benefit on any party not a party hereto, other than said respective successors, assigns, heirs, executors and administrators.

 

4.3 Entire Agreement; Amendment. This Agreement and the other documents referenced herein and delivered pursuant hereto constitute the full and entire understanding and agreement among the parties with regard to the subject matter hereof and supersede all prior agreements and understandings relating thereto. Neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

 

4.4 Notices, Etc. All notices under this Agreement shall be sufficiently given for all purposes if made in writing and delivered personally, or, to the extent receipt by the other party hereunder is confirmed, sent by documented overnight delivery service facsimile or other electronic transmission.

 

4.5 Expenses. Buyer and Sellers shall each bear their respective expenses and legal fees incurred on their own behalf with respect to this Agreement and the transactions contemplated hereby.

 

4.6 Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall constitute one instrument.

 

4.7 Enforcement. The parties hereto agree that irreparable damage for which money damages would not be an adequate remedy would occur in the event that any of the provision of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that, in addition to any other remedies a party may have at law or equity, the parties shall be entitled to seek an injunction or injunctions to prevent such breach of this Agreement and to enforce specifically the terms hereof.

 

Signature page follows.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

	BUYER:
	BLACKWELL PARTNERS LLC
	By:	/s/ Jannine Lall
		Name: Jannine Lall
		Title: Assistant Treasurer, DUMAC, Inc.
	By:	/s/ Justin B. Nixon
		Name: Justin B. Nixon
		Title: Investment Manager, DUMAC, Inc.
	Trigran Investments, L.P.:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.
	Trigran Investments, L.P. II:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.

 

Exhibit 99.5

 

STOCK PURCHASE AND

SALE AGREEMENT

 

THIS STOCK PURCHASE AND SALE AGREEMENT (this “Agreement”), dated as of December 31, 2013, is entered into by and among Silver Creek CS SAV, L.L.C. ( “Buyer”), Trigran Investments, L.P., an Illinois limited partnership (“Trigran”), and Trigran Investments, L.P. II, an Illinois limited partnership (“Trigran II”, and together with Trigran, “Sellers”).

 

WHEREAS, Trigran currently owns 94,045 shares (the “Trigran Shares”) of common stock of Scientific Learning Corporation, a Delaware corporation (“SCIL”), which to Sellers’ knowledge represent 0.40% of the total issued and outstanding shares of the capital stock of SCIL;

 

WHEREAS, Trigran II currently owns 52,214 shares (the “Trigran II Shares”, and together with the Trigran Shares, the “Shares”) of common stock of SCIL, which to Sellers’ knowledge represent 0.22% of the total issued and outstanding shares of the capital stock of SCIL; and

 

WHEREAS, Buyer desires to purchase from Sellers and Sellers desire to sell to Buyer the Shares, on the terms and subject to the conditions set forth herein.

 

NOW, THEREFORE, the parties agree as follows:

 

1. Purchase and Sale of Shares.

 

1.1 Trigran Shares. Effective as of December 31, 2013 (the “Effective Date”), Buyer does hereby purchase from Trigran, and Trigran does hereby sell to Buyer, the Trigran Shares, for an aggregate purchase price of $14,106.75 (the “Trigran Purchase Price”), at $0.15per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein. The Trigran Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares,  no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran.  The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

1.2 Trigran II Shares. Effective as of the Effective Date, Buyer does hereby purchase from Trigran II, and Trigran II does hereby sell to Buyer, the Trigran II Shares, for an aggregate purchase price of $7,832.10 (the “Trigran II Purchase Price”, and in addition to the Trigran Purchase Price, the “Purchase Price”), at $0.15 per share, subject to the terms and conditions of this Agreement and on the basis of the representations, warranties, covenants and agreements contained herein (the purchases and sales contemplated in Sections 1.1 and 1.2, the “Transactions”). The Trigran II Purchase Price is payable in cash by wire transfer, sent following receipt of the Trigran Shares, no later than 5:00 P.M. on the third business day following the Effective Date, to an account designated in writing by Trigran II. The Transactions shall be deemed to be effective at 5:00 P.M. on the Effective Date.

 

2. Representations and Warranties.

 

2.1 Representations and Warranties of Sellers. Sellers hereby make each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Sellers have full legal right, power and authority, without the consent of any other natural person, corporation, business trust, trust, estate, partnership, limited partnership, limited liability company, limited liability partnership, association, joint venture, or other entity (each a “Person”), to execute and deliver

 

 

this Agreement, and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Sellers, enforceable against the Sellers in accordance with its terms.

 

(b) Sellers are the sole record and beneficial holders of the Shares, and hold the Shares as principals, and have not entered into any agreement with any third party with respect to the ownership of the Shares or any sharing, splitting, or delegation of any of the rights represented thereby. Sellers own the Shares free and clear of all liens and encumbrances.

 

2.2 Representations and Warranties of Buyer. Buyer hereby makes each of the representations and warranties set forth below, each of which shall survive the closing.

 

(a) Buyer has full legal right, power and authority, without the consent of any other Person, to execute and deliver this Agreement and to carry out the Transactions, and this Agreement shall constitute the legal, valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with its terms.

 

(b) Buyer has received and carefully reviewed the last reported Annual Report of SCIL on Form 10-K and all subsequent public filings of SCIL with the Securities and Exchange Commission, other publicly available information regarding SCIL, and such other information that it and its advisers deem necessary to make its decision to enter into the Transactions.

 

(c) Buyer has made its own decision to consummate the Transactions based on its own independent review and consultations with such investment, legal, tax, accounting and other advisers as it deemed necessary. Buyer has made its own decision concerning the Transactions without reliance on any representation or warranty of, or advice from, Sellers.

 

(d) Buyer acknowledges and understands that Sellers and their partners, agents and affiliates, as defined in Rule 405 under the Securities Act including any past and present affiliate (“Affiliates”), may possess certain information, possibly including material and/or immaterial nonpublic information, not known to Buyer that may impact the value of the Shares (the “Information”). Buyer understands, based on its own experience, the potential disadvantage to which Buyer may be subject due to any possible disparity of information between Buyer and Sellers.  Notwithstanding this, Buyer has deemed it appropriate to engage in the Transactions.  Moreover, Buyer undertakes and agrees that it will not initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, induce or encourage any other person or entity to initiate or maintain any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information, or assist any other person or entity in the initiation or maintenance of any legal or similar action against Sellers and/or their Affiliates based upon or relating to any such Information (unless such assistance is compelled by valid legal process).

 

(e) Buyer agrees that Sellers shall have no liability to Buyer whatsoever due to or in connection with Sellers’ use or non-disclosure of the Information, and Buyer hereby irrevocably waives any claim that it might have based on the failure of the Sellers to disclose the Information.

 

(f) Buyer acknowledges and agrees that Sellers are relying on Buyer’s representations, warranties and agreements herein as a condition to proceeding with the Transactions.

 

3. Further Assurances. If at any time after the date hereof, Buyer or Sellers shall consider or be advised that any further documents, assignments or assurances in law or in any other things are necessary, desirable or proper to vest, perfect or confirm, of record or otherwise, in Buyer, the title to the Shares, then Sellers and/or Buyer, as the case may be, shall execute and deliver all such proper assignments and assurances in law and do all things necessary, desirable or proper to vest, perfect or confirm title to such property or rights and otherwise to carry out the purpose of this Agreement.

 

 

4. Miscellaneous.

 

4.1 Governing Law. This Agreement shall be governed in all respects by the laws of the State of Illinois, without regard to any provisions thereof relating to choice of law or conflicts of laws among different jurisdictions.

 

4.2 Successors and Assigns. Except as otherwise provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto. This Agreement shall not be construed so as to confer any right or benefit on any party not a party hereto, other than said respective successors, assigns, heirs, executors and administrators.

 

4.3 Entire Agreement; Amendment. This Agreement and the other documents referenced herein and delivered pursuant hereto constitute the full and entire understanding and agreement among the parties with regard to the subject matter hereof and supersede all prior agreements and understandings relating thereto. Neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

 

4.4 Notices, Etc. All notices under this Agreement shall be sufficiently given for all purposes if made in writing and delivered personally, or, to the extent receipt by the other party hereunder is confirmed, sent by documented overnight delivery service facsimile or other electronic transmission.

 

4.5 Expenses. Buyer and Sellers shall each bear their respective expenses and legal fees incurred on their own behalf with respect to this Agreement and the transactions contemplated hereby.

 

4.6 Counterparts. This Agreement may be executed in any number of counterparts, all of which together shall constitute one instrument.

 

4.7 Enforcement. The parties hereto agree that irreparable damage for which money damages would not be an adequate remedy would occur in the event that any of the provision of this Agreement were not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that, in addition to any other remedies a party may have at law or equity, the parties shall be entitled to seek an injunction or injunctions to prevent such breach of this Agreement and to enforce specifically the terms hereof.

 

Signature page follows.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

 

 

	BUYER:
	SILVER CREEK CS SAV, L.L.C.
	By:	Nantahala Capital Management, LLC
		Its Investment Manager
	By:	/s/ Daniel Mack
		Name: Daniel Mack
		Title: Manager
	Trigran Investments, L.P.:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.
	Trigran Investments, L.P. II:
	By:	/s/ Lawrence A. Oberman
		Name: Lawrence A. Oberman
		Title: Executive VP of Trigran Investments, Inc.