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EXHIBIT 10.18
SECOND AMENDMENT TO PREFERRED STOCK PURCHASE AGREEMENT
CLASS A PREFERRED STOCK
THIS SECOND AMENDMENT TO PREFERRED STOCK PURCHASE AGREEMENT FOR CLASS A
PREFERRED STOCK (the "Amendment") is made as of this 28th of October, 1994,
by and between the individuals set forth on the signature pages hereto (the
"Purchasers") and SEAMED CORPORATION (the "Company"). Unless otherwise defined
herein, all capitalized terms shall have the meanings that are ascribed to them
in the Agreement, as defined below.
RECITALS
A. The Purchasers and the Company are parties to that certain
Preferred Stock Purchase Agreement dated March 28, 1984, as amended by that
certain first Amendment to Preferred Stock Purchase Agreement for Class A
Preferred Stock dated as of July 31, 1986 (so amended, the "Agreement").
B. The Company has engaged an investment banking firm, Xxxxx &
Company, to raise an additional $2,000,000 of equity financing through the sale
of Class D Convertible Preferred Stock (the "Class D Stock"). The Company shall
use the proceeds from such sale to reduce its outstanding borrowings under its
various credit lines, to purchase equipment and as general working capital.
C. As shareholders of the Company, the Purchasers expect to benefit,
directly and indirectly, from the sale of the Class D Stock.
D. In order to facilitate the sale of the Class D Stock, the parties
desire to amend the Agreement pursuant to the terms and conditions of this
Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Section 7.2 is hereby amended and restated as follows:
7.2 Additional Information. The Company will permit any person who
owns (or has been designated as the representative of holder of)
100,000 or more of the Shares or such number of shares of Common Stock
issued upon conversion of 100,000 or more of the Shares, or any
combination thereof, to visit and inspect any of the properties of the
Company, including its books of account, and to discuss its affairs,
finances and accounts with the Company's officers and its
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independent public accountants, all at such reasonable times and as
often as any such person may reasonably request, provided that such
person shall provide the Company with reasonable advance notice of his
desire to so visit and inspect. Until the earlier to occur of (i) the
date on which the Company is subject to the reporting requirements of
Section 13(a) of the Exchange Act, or (ii) the date on which quotations
for the Common Stock of the Company are reported by the automated
quotations system operated by the National Association of Securities
Dealers, Inc., or by an equivalent quotations system, the Company will
deliver to each such person, as soon as practicable after the end of
the month and in any event within thirty (30) days thereafter, a
consolidated balance sheet of the Company and its subsidiaries, if any,
as at the end of such month, and the consolidated statements of income
of the Company and its subsidiaries, for each month and for the current
fiscal year of the Company to date, prepared in accordance with
generally accepted accounting principles consistently applied together
with a comparison of such statements to the Company's operating plan
then in effect and approved by its Board of Directors, and certified,
subject only to normally occurring accruals, by the principal financial
or accounting officer of the Company.
The foregoing provisions of this Section 7.2 shall not be in limitation
of any rights which a Purchaser may have with respect to books and
records of the Company and its subsidiaries, or to inspect their
properties or discuss their affairs, finances and accounts, under the
laws of the jurisdictions in which they are incorporated.
2. Section 7.3 is hereby amended and restated as follows:
7.3 Right of First Refusal; Additional Financing. The parties
recognize the Company previously issued Class B Preferred Stock and has
need for additional financing and may thus issue an additional class of
preferred stock to be known as Class D Convertible Preferred Stock
(together, the "Other Preferred Classes") which was, or will be, sold
to purchasers according to the preferred stock purchase agreements for
the Other Preferred Classes (the "Stock Purchase Agreements") which
allow for a common right of first refusal with respect to New
Securities (as defined in Section 7.3(a)). The Company hereby grants to
each Purchaser of Class A Preferred Stock a right of first refusal to
purchase in common with the purchasers (or transferees thereof) of the
Other Preferred Classes, pro rata, all or any part of New Securities
(as defined in Section 7.3(a)) which the Company may, from time to
time, propose to issue and sell. A Purchaser's pro rata share, for the
purposes of this right of first refusal, is the ratio of (i) the number
of Shares purchased by such Purchaser under this Agreement plus the
number of shares of stock purchased by Purchaser under the Stock
Purchase Agreements, to (ii) the total number of Shares purchased by
all Purchasers under this Agreement and the Other Agreements plus the
number of shares of stock purchased by all purchasers under all the
Stock Purchase Agreements. Each Purchaser shall have a right of
over-allotment such that if any
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Purchaser or purchaser (or transferee thereof) of Other Preferred
Classes fails to exercise his right of first refusal , the other
Purchasers under this Agreement and the other purchasers (or
transferees thereof) under the Stock Purchase Agreements may purchase
the non-purchasing purchaser's portion on a pro rata basis within five
days from the date such non-purchasing purchaser fails to exercised his
right to purchase his pro rata share of the New Securities. This right
of first refusal shall be subject to the following provisions:
(a) "New Securities" shall mean any capital stock (including
the Common Stock or any Preferred Stock) of the Company whether or not
presently authorized, and right, options, or warrants to purchase
capital stock and securities of any type whatsoever that are, or may
become, convertible into capital stock; provided that the term "New
Securities" does not include (i) securities purchased under this
Agreement and the Other Agreements, or under any agreement relative to
any of the shares of preferred stock presently authorized; (ii)
securities offered to the public pursuant to a registration statement
filed pursuant to the Securities Act; (iii) securities issued pursuant
to the acquisition of another corporation by the Company by merger,
purchase of substantially all the assets or other reorganization
whereby the Company owns not less than fifty-one percent (51%) of the
voting power of such corporation following the completion of such
transaction; (iv) any borrowings, direct or indirect, from financial
institutions or other persons by the Company, whether or not presently
authorized, including any type of loan or payment evidenced by any type
of debt instrument, provided such borrowings do not have any equity
features, including warrants, options, equity participation or
"kickers" or other rights to purchase capital stock, and are not
convertible into capital stock of the Company; or (v) securities issued
to employees, consultants, or directors of the Company pursuant to any
stock option plan, stock purchase agreement, or stock bonus
arrangement.
(b) In the event the Company proposes to undertake an
issuance of New Securities, it shall give each Purchaser hereunder and
each purchaser (or transferee thereof) under the Stock Purchase
Agreements written notice of its intention, describing the type of New
Securities, the price and the general terms upon which the Company
proposes to issue the same. Each Purchaser shall have fifteen (15) days
from the date of receipt of any such notice to agree to purchase their
pro rata share of such New Securities for the price and upon the
general terms specified in the notice by giving written notice to the
Company and stating therein the quantity of New Securities to be
purchased.
(c) In the event one or more Purchasers fail to exercise the
right of first refusal within said fifteen (15) day period and after
the expiration of the 5-day period for the exercise of the
over-allotment provisions of this Section 7.3, the Company shall have
one hundred eighty (180) days thereafter to sell or enter into an
agreement (pursuant to which the sale of New Securities covered thereby
shall be closed, if at all, within one hundred eighty (180) days from
the date of said
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agreement) to sell the New Securities in respect of which the
Purchasers' option was not exercised, at a price and upon general terms
no more favorable to the purchasers thereof than specified in the
Company's notice. In the event the Company has not sold the New
Securities within said 180-day period or entered into an agreement to
sell the New Securities within said 180-day period (or sold and issued
New Securities in accordance with the foregoing within one hundred
eighty (180) days from the date of said agreement), the Company shall
not thereafter issue or sell any New Securities, without first offering
such securities to the Purchasers hereunder in the manner provided
above.
(d) The right of first refusal granted under this Agreement
shall expire (i) with respect to each share of Preferred, upon
conversion of such share to Common Stock, and (ii) with respect to all
shares of Preferred, upon the first sale of Common Stock of the Company
to the public at a per share offering price of at least five times the
then existing conversion price for the Preferred, which sale is
effected pursuant to a registration statement filed with, and declared
effective by, the Securities and Exchange Commission (the "Commission")
under the Securities Act in a firm commitment underwritten public
offering, with an aggregate offering price to the public of not less
than $5,000,000.
(e) The right of first refusal set forth in this Section 7.3
is nonassignable, except that (i) such right is assignable by each
Purchaser to any wholly-owned subsidiary or parent of, or to any
corporation or entity which is, within the meaning of the Securities
Act controlling, controlled by, or under common control with, any such
Purchaser, (ii) such right is assignable between and among any of the
Purchasers hereunder or the purchasers (or transferees thereof) under
the Stock Purchase Agreements, and (iii) upon the death of a Purchaser,
such right shall pass with the Shares to the beneficiaries under the
deceased Purchaser's last will and testament or the distributees of the
deceased Purchaser's estate.
3. Section 8.12 is hereby amended and restated as follows:
8.12 Limitations on Registration of Issuers Securities. From
and after the date of this Agreement, but excluding any agreement
between the Company and the holders of Class D Preferred Stock, the
Company shall not enter into any agreement with any holder or
prospective holder of any securities of the Company giving such holder
or prospective holder the right to require the Company to initiate any
registration of any securities of the Company, provided, that this 8.12
shall not limit the right of the Company to enter any agreements with
any holder or prospective holder of any securities of the Company
giving such holder or prospective holder the right to require the
Company, upon any registration of any of its securities, to include,
among the securities which the Company is then registering, securities
owned by such holder. Any right given by the Company to any holder or
prospective holder of the Company's securities in connection with
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the registration of securities shall be conditioned such that it shall
be consistent with the provisions of this Section 8 and with the rights
of the Holders provided in this Agreement.
4. Except as modified by this Amendment, all provisions of the
Agreement are unchanged and remain in full force and effect and are ratified and
confirmed by the parties hereto.
5. This Amendment may be signed in several counterparts, each of which
shall be deemed an original and all such counterparts together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Amendment to be
executed as of the day and year first written above.
SEAMED CORPORATION
By /s/ W. Xxxxxx Xxxx
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Its Pres/C.E.O.
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STOCKHOLDERS:
/s/ R. Xxxxx Xxxx /s/ Xxxxxx X. Xxxxxx
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R. Xxxxx Xxxx Xxxxxx X. Xxxxxx
XXXXXXX ENTERPRISES
By /s/ [unreadable] /s/ Xxxxxxx X. Xxxxx
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Its Xxxxxxx X. Xxxxx
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/s/ Xxxx Xxxxxx /s/ Xxxxxxx X. Xxxxx
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Xxxx Xxxxxx Xxxxxxx X. Xxxxx
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GEOCAPITAL VENTURES
By /s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxxxx Xxx Xxxxxxx
--------------------------------- ------------------------------------
Its Xxxxxxx Xxx Xxxxxxx
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PIONEER ASSOCIATES PIONEER III
By /s/ R. Xxxxx Xxxx By /s/ R. Xxxxx Xxxx
--------------------------------- ----------------------------------
Its GP Its GP
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PIONEER IV
By /s/ R. Xxxxx Xxxx /s/ Xxxxx Xxxxxxx
--------------------------------- ------------------------------------
Its GP Xxxxx Xxxxxxx
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/s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxx
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