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EXHIBIT 10.2
EXECUTION COPY
IMP, Inc.
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PHASE 2 STOCK PURCHASE AGREEMENT
Dated as of December 15, 1999
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TABLE OF CONTENTS
PAGE
ARTICLE 1 PURCHASE AND SALE OF STOCK...........................................1
SECTION 1.1. Delivery.......................................................1
ARTICLE 2 REPRESENTATIONS AND WARRANTIES OF COMPANY............................1
SECTION 2.1. Organization, Standing and Qualification.......................1
SECTION 2.2. Capitalization.................................................1
SECTION 2.3. Validity of Stock..............................................2
SECTION 2.4. Subsidiaries...................................................2
SECTION 2.5. Financial Statements...........................................2
SECTION 2.6. Authorization; Approvals.......................................3
SECTION 2.7. No Conflict with Other Instruments.............................3
SECTION 2.8. Absence of Undisclosed Liabilities; Changes....................3
SECTION 2.9. Patents, Trademarks and Other Intangible Assets................3
SECTION 2.10. Taxes..........................................................4
SECTION 2.11. Litigation.....................................................4
SECTION 2.13. Private Offering...............................................4
SECTION 2.14. Fees and Commissions...........................................4
SECTION 2.15. Compliance with Environmental Laws.............................5
ARTICLE 3 REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER...........5
SECTION 3.1. Authorization..................................................5
SECTION 3.2. Investment Representations.....................................5
SECTION 3.3. Investment Experience; Access to Information...................5
SECTION 3.4. Absence of Registration........................................6
SECTION 3.5. Restrictions on Transfer.......................................6
SECTION 3.6. Transfer Instructions..........................................6
SECTION 3.7. Economic Risk..................................................6
SECTION 3.8. Fees and Commissions...........................................7
SECTION 3.9. [Reserved].....................................................7
SECTION 3.10. Restructuring of Debt..........................................7
SECTION 3.11. Wafer Purchase Commitment......................................7
ARTICLE 4 CONDITIONS TO OBLIGATIONS OF THE PURCHASER...........................7
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 4.1. Conditions to Obligations of the Purchaser....................7
ARTICLE 5 CONDITIONS TO OBLIGATIONS OF COMPANY.................................8
SECTION 5.1. Conditions to Obligations of the Company......................8
ARTICLE 6 AFFIRMATIVE COVENANTS................................................9
SECTION 6.1. Preparation of Proxy Statement: Stockholders' Meeting..........9
SECTION 6.2. Piggy-Back Registrations.......................................9
SECTION 6.3. Registrations on Form S-1 or Form S-3.........................10
SECTION 6.4. Effectiveness.................................................11
SECTION 6.5. Right of First Offer..........................................11
SECTION 6.6. Additional Purchases By Purchaser.............................12
SECTION 6.7. Employee Retention Plan.......................................13
SECTION 6.8. Purchaser's Board of Directors Designee.......................13
ARTICLE 7 MISCELLANEOUS.......................................................13
SECTION 7.1. Survival of Agreements........................................13
SECTION 7.2. Notices.......................................................13
SECTION 7.3. Modifications; Waiver.........................................14
SECTION 7.4. Exculpation...................................................14
SECTION 7.5. Entire Agreement..............................................14
SECTION 7.6. Successors and Assigns........................................14
SECTION 7.7. Enforcement...................................................15
SECTION 7.8. Execution and Counterparts....................................15
SECTION 7.9. Governing Law and Severability................................15
SECTION 7.10. Headings......................................................15
SECTION 7.11. Confidentiality...............................................16
SECTION 7.12. [Reserved.]...................................................16
SECTION 7.13. [Reserved.]...................................................16
SECTION 7.14. Indemnification...............................................16
SECTION 7.15. [Reserved]....................................................17
SECTION 7.16. Expenses......................................................17
ANNEX I - ADDITIONAL PURCHASER REPRESENTATIONS.......................................I-1
DISCLOSURE SCHEDULE..................................................................S-1
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SCHEDULE 2.2(B) - WARRANTS..........................................................S2.2(B)-1
SCHEDULE 2.9 - PATENTS.................................................................S2.9-1
SCHEDULE 2.10 - TAXES ................................................................S2.10-1
SCHEDULE 2.12 - DEFAULT OF OBLIGATIONS ...............................................S2.12-1
SCHEDULE 3.11 - FOUNDRY SERVICES......................................................S3.11-1
EXHIBIT A - FORM OF LEGAL OPINION.........................................................A-1
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PHASE 2 STOCK PURCHASE AGREEMENT
Agreement, dated as of December 15, 1999 between IMP, Inc., a Delaware
corporation (the "Company") and Teamasia Semiconductors PTE Ltd., a Singapore
corporation (the "Purchaser").
ARTICLE 1
PURCHASE AND SALE OF STOCK
SECTION 1.1. Delivery. Subject to the provisions of this Agreement, the
Purchaser agrees to purchase at the Closing (as defined below), and the Company
agrees to sell and issue to the Purchaser at the Closing, 4,793,235 shares of
common stock of the Company, (the "Purchased Shares") for the aggregate purchase
price of $3,930,000 ($0.82 per share) (the "Purchase Price"). The purchase and
sale of Purchased Shares shall take place at the offices of the Company at 10:00
a.m. West Coast time not later than 14 Business Days after the last condition of
Section 4.1 herein is satisfied, or at such other time and place as the Company
and Purchaser mutually agree upon in writing (which time and place are
designated as the "Closing" and which date is designated as the "Closing Date").
At the Closing, the Company shall deliver to the Purchaser a certificate
representing the Purchased Shares that the Purchaser is purchasing against
delivery to the Company by the Purchaser by wire transfer, certified check for
immediately available funds, or other manner approved by the Company, in the
amount of the purchase price therefor payable to the Company's order.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF COMPANY
As of the date of this Agreement and as of the Closing Date, the Company
represents and warrants that, except as set forth in the Disclosure Schedules:
SECTION 2.1. Organization, Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has full corporate power and corporate authority to
own, lease and operate its property and assets and to conduct its business as
presently conducted and as proposed to be conducted by it. The Company has full
corporate power and corporate authority to enter into and perform its
obligations under this Agreement, to carry out the transactions contemplated by
this Agreement. The nature of the Company's business and its ownership or
leasing of property do not require that the Company become qualified as a
foreign corporation in any state or jurisdiction where it is not qualified,
other than where the failure to so qualify will not have a material adverse
effect on the Company. Complete and correct copies of the articles and by-laws
of the Company, as amended to date, have been delivered to counsel for the
Purchaser.
SECTION 2.2. Capitalization.
(a) The capital stock of the Company consists of 50,000,000 shares of
authorized common stock, par value $0.01 per share ("Common Stock"), of which
4,040,544 shares are issued and outstanding as of the date of this Agreement and
619,533 shares are reserved for
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issuance pursuant to employee stock purchase and/or option ownership plans that
have been adopted by the Company for officers, directors, employees and
consultants.
(b) Except as set forth on Schedule 2.2, there are (i) no outstanding
warrants, options, convertible securities or rights to subscribe for or purchase
any capital stock or other securities from the Company, (ii) to the Company's
knowledge, no voting trusts or voting agreements among, or irrevocable proxies
executed by, stockholders of the Company, and (iii) no obligations (contingent
or otherwise) of the Company to purchase, redeem or otherwise acquire any shares
of its capital stock or any interest therein or to pay any dividend or make any
other distribution in respect thereof.
(c) The Company was notified on November 19, 1999 that the NASDAQ Stock
Market is conducting a review of the Company to determine its eligibility for
continued listing on the NASDAQ Small Cap Market. The Company is in the process
of providing financial information to NASDAQ Stock Market evidencing the
Company's current and on-going compliance and fully anticipates maintaining its
listing with the NASDAQ Small Cap Market.
SECTION 2.3. Validity of Stock. The Purchased Shares to be sold pursuant
to this Agreement, when issued, sold, and delivered in accordance with the terms
of this Agreement, will be duly and validly issued, fully paid and
non-assessable.
SECTION 2.4. Subsidiaries. The Company does not own any capital stock,
partnership interests or other equity interests of, or control, directly or
indirectly, any other corporation, partnership, association or business entity.
SECTION 2.5. Financial Statements.
(a) The Company has furnished the Purchaser with its audited financial
statements as of and for the year ended March 28, 1999, and an audited balance
sheet as of March 28, 1999 (the "Balance Sheet") (together, the "1999 Financial
Statements"). As amended on July 26, 1999, the 1999 Financial Statements and the
Balance Sheet are true and correct in all material respects, are in accordance
with the books and records of the Company, and have been prepared in accordance
with generally accepted accounting principles ("GAAP") consistently applied, and
fairly present the financial position of the Company as of such date and the
results of its operations for the periods then ended.
(b) The unaudited balance sheet of the Company as of September 26, 1999
(the "Current Balance Sheet") and the related unaudited statements of profit and
loss and cash flow, including the footnotes thereto (collectively, the "Current
Financial Statements"), for the three months then ended, a copy of which has
been made available to the Purchaser, fairly present, in conformity with
generally accepted accounting principles, applied on a basis consistent with the
financial statements referred to in subsection (a) of this Section, the
financial position of the Company as of such date and its results of operations
(subject to normal year-end adjustments). The 1999 Financial Statements and
Current Financial Statements are hereinafter referred to as the "Financial
Statements".
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SECTION 2.6. Authorization; Approvals. All action on the part of the
Company and its stockholders necessary for the authorization, execution,
delivery, and performance of all its obligations under this Agreement and for
the authorization, issuance, and delivery of the Purchased Shares being sold
under this Agreement, has been taken or will be taken prior to the Closing Date.
The Board of Directors of the Company has approved this Agreement and the
transactions contemplated hereby in accordance with Section 203 of the Delaware
General Corporation Law. This Agreement constitutes the valid and legally
binding obligation of the Company, enforceable against the Company in accordance
with its terms. The Company has obtained or will obtain prior to the Closing
Date all necessary consents, authorizations, approvals and orders, and has made
all registrations, qualifications, designations, declarations or filings with
all federal, state, or other relevant governmental authorities required on the
part of the Company in connection with the consummation of the transactions
contemplated by this Agreement.
SECTION 2.7. No Conflict with Other Instruments. The execution, delivery
and performance of this Agreement does not and will not result in any violation
of, conflict with, or constitute a default under any terms or provision of (a)
the Company's articles of incorporation or bylaws; (b) any judgment, decree or
order to which the Company is a party or by which its property is bound; (c) any
agreement, contract, understanding, indenture or other instrument to which the
Company is a party, the effect of which would give rise to a material adverse
effect on the Company; or (d) any statute, rule or governmental regulation
applicable to the Company or any of its property.
SECTION 2.8. Absence of Undisclosed Liabilities; Changes. To its
knowledge, the Company has no liability or obligation, which would have a
material adverse effect on the Company, absolute or contingent, including,
without limiting the generality of the foregoing, any tax liabilities due or to
become due, not reflected in the Current Balance Sheet, except: (a) obligations
and liabilities incurred after the date of the Current Balance Sheet in the
ordinary course of business that are not individually or in the aggregate
material, (b) obligations under contracts made in the ordinary course of
business that would not be required to be reflected in financial statements
prepared in accordance with GAAP and (c) obligations under this Agreement.
Without limiting the generality of the foregoing, the Company does not know of,
and has no reasonable ground to believe that there is any basis for the
assertion against the Company of, any material liabilities of the Company.
SECTION 2.9. Patents, Trademarks and Other Intangible Assets.
(a) The Company has taken otherwise reasonable security measures to
protect the secrecy, confidentiality and value of all material intellectual
property of the Company.
(b) To the knowledge of the Company, the Company has title and ownership
(or licenses to use in various cases) of all patents, trademarks, service marks,
trade names, copyrights, trade secrets, and other intellectual property rights
necessary for its business as now conducted or as currently proposed to be
conducted without any known conflict with or infringement of the rights of
others. Except as disclosed in Schedule 2.9 hereto, the Company has not received
any communications alleging that the Company has violated or, by conducting its
business as proposed, would violate any of the patents, trademarks, service
marks, trade
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names, copyrights or other intellectual property rights of any other person or
entity where any such allegation, if true, would be reasonably likely to have a
material adverse effect on the Company.
SECTION 2.10. Taxes. The Company has accurately prepared and timely
filed all federal, state and local reports, returns, estimates, declarations,
information returns and statements with respect to taxes (together, "Tax
Returns") that are required to be filed by it and has paid or made provision for
the payment of all taxes due with respect to the periods covered by such Tax
Returns, in all material respects. Except as disclosed in Schedule 2.10, no
deficiency assessment or proposed adjustment of federal income taxes or state or
municipal taxes of the Company is pending and the Company has no knowledge of
any proposed liability for any tax to be imposed where any such assessment or
proposed adjustment, if adversely decided, would be reasonably likely to have a
material adverse effect on the Company. For the purpose of this Section 2.10,
"tax" or "taxes" shall mean all federal, state, local or foreign taxes,
including but not limited to income, gross receipts, windfall profits,
alternative minimum, value added, severance, property, production, sales, use,
license, excise, franchise, employment, withholding or similar taxes, together
with any interest, additions or penalties with respect thereto and any interest
in respect of such additions or penalties.
SECTION 2.11. Litigation. Except as otherwise set forth herein, no
action, proceeding or governmental inquiry or investigation is pending or to the
knowledge of the Company threatened against (a) the Company or any of its
officers, directors or employees (in their capacity as such), (b) any of the
Company's properties or (c) to the knowledge of the Company, any material
consultant to the Company, in any case before any court, arbitration board or
tribunal or administrative or other governmental agency, nor is the Company
aware that there is any basis for the foregoing, where any such action,
proceeding, inquiry or investigation, if adversely decided, would be reasonably
likely to have a material adverse effect on the Company.
SECTION 2.12. Relationship with Creditors. The Company is presently in
default of its obligations to, or has negotiated revised payment schedules with,
the parties listed in Schedule 2.12, as described therein.
SECTION 2.13. Private Offering. The Company agrees that neither the
Company nor anyone acting on its behalf has offered or will offer securities of
the Company or any part thereof or any similar securities for issuance or sale
to, or solicit any offer to acquire any of the same from, anyone so as to make
the issuance and sale of the Purchased Shares not exempt from the registration
requirements of Section 5 of the Securities Act of 1933, as amended (the
"Securities Act"). None of the shares of the Company's capital stock issued and
outstanding has been offered or sold in such a manner as to make the issuance
and sale of such shares not exempt from such registration requirements, and all
such shares of capital stock have been offered and sold in compliance with all
applicable federal and state securities laws.
SECTION 2.14. Fees and Commissions. The Company has not retained, or
otherwise authorized to act, any finder, broker, agent, financial advisor or
other intermediary (collectively, "Intermediary") in connection with the
transactions contemplated by this Agreement and the Company shall indemnify and
hold harmless the Purchaser from liability
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for any compensation, to any Intermediary retained or otherwise authorized to
act by, or on behalf of, the Company and the fees and expenses of defending
against such liability or alleged liability.
SECTION 2.15. Compliance with Environmental Laws. To the knowledge of
the Company, it is not in violation of any agreement, instrument, judgment,
decree, or order, or federal, state, local or foreign statute, ordinance, rule
or regulation applicable to or binding upon it (including but not limited to any
environmental laws, rules and regulations), the violation of which would be
reasonably likely to have a material adverse effect on the Company. To the
knowledge of the Company, there is no contamination of any real property leased
or operated by the Company that could subject the Company to liability in excess
of $50,000 under any environmental laws or regulations.
ARTICLE 3
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER
The Purchaser covenants, and as of the date of this Agreement and as of
the Closing Date, the Purchaser represents and warrants that:
SECTION 3.1. Authorization. The Purchaser has full power and authority
to enter into and to perform this Agreement in accordance with its terms. This
Agreement has been duly executed and delivered by the Purchaser and constitutes
a valid and legally binding obligation of the Purchaser.
SECTION 3.2. Investment Representations. The Purchaser is acquiring the
Purchased Shares for the Purchaser's own account, for investment purposes and
not with a view to, or for sale in connection with, any distribution of such
securities or any part thereof in violation of federal or state securities laws.
SECTION 3.3. Investment Experience; Access to Information. (a) The
Purchaser or a person acting in its capacity as "purchaser representative" (as
defined in Regulation D of the Securities Act) for the Purchaser, is an
"accredited investor" as that term is defined in Rule 501(a) promulgated under
the Securities Act, is a sophisticated investor; is able to fend for itself in
the transactions contemplated by this Agreement, has such knowledge and
experience in financial, business and investment matters as to be capable of
evaluating the merits and risks of this investment, has the ability to bear the
economic risks of this investment, has been furnished with or has had access to
such information as is specified in subparagraph (b)(2) of Rule 502 promulgated
under the Securities Act, was not organized or reorganized for the specific
purpose of acquiring the Purchased Shares purchased by it and has been afforded
the opportunity to ask questions of, and to receive answers from, the Company
and to obtain any additional information, to the extent the Company has or could
have acquired such information without unreasonable effort or expense, all as
necessary for the Purchaser or "purchaser representative" to make an informed
investment decision with respect to the purchase of the Purchased Shares. The
foregoing, however, does not limit or modify the representations and warranties
of the Company in Article 2 of this Agreement or the right of the Purchaser to
rely thereon.
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(a) In addition to the foregoing, the Purchaser acknowledges, represents
and warrants, as applicable, as set forth in Annex I hereto.
SECTION 3.4. Absence of Registration. The Purchaser understands that the
Purchased Shares to be sold and issued hereunder may not be sold by the
Purchaser unless it is subsequently registered under the Securities Act, or an
exemption from such registration is available.
SECTION 3.5. Restrictions on Transfer. The Purchaser agrees that (a) it
will not offer, sell, pledge, hypothecate, or otherwise dispose of the Purchased
Shares other than to its "affiliates" unless such offer, sale, pledge,
hypothecation or other disposition is (i) registered under the Securities Act,
or (ii) in compliance with an opinion of counsel to the Purchaser, delivered to
the Company and reasonably acceptable to it, to the effect that such offer,
sale, pledge, hypothecation or other disposition thereof does not violate the
Securities Act, and (b) the certificate(s) representing the Purchased Shares
shall bear a legend stating in substance:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
ANY STATE AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED
OR HYPOTHECATED OTHER THAN TO AFFILIATES (AS DEFINED) OF THE REGISTERED
HOLDER HEREOF UNLESS AND UNTIL REGISTERED UNDER SAID ACT OR, IN THE
OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF
THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION
DOES NOT VIOLATE THE PROVISIONS THEREOF.
For purposes of this Section 3.5, "affiliate" of any Purchaser means (i)
any entity more than 10% of the voting stock or other voting interest of which
is owned, directly or indirectly through one or more intermediaries, by the
Purchaser, (ii) any entity which owns, directly or indirectly through one or
more intermediaries, more than 10% of the voting stock of the Purchaser, (iii)
any entity of which 10% or more of the voting stock is owned by an affiliate of
the Purchaser, and (iv) with respect to a Purchaser that is a trust, a grantor
or beneficiary of such trust or other entity under the control of such grantor
or beneficiary. Upon request of a holder of Purchased Shares the Company shall
remove the legend set forth above from the certificates evidencing such
Purchased Shares or issue to such holder new certificates therefor free of such
legend, if with such request the Company shall have received an opinion of
counsel selected by the holder and reasonably satisfactory to the Company, in
form and substance reasonably satisfactory to the Company, to the effect that
such Purchased Shares are not required by the Securities Act to continue to bear
the legend.
SECTION 3.6. Transfer Instructions. The Purchaser agrees that the
Company may provide for appropriate transfer instructions to implement the
provisions of Section 3.5 hereof.
SECTION 3.7. Economic Risk. The Purchaser understands that it must bear
the economic risk of the investment represented by the purchase of Purchased
Shares for an indefinite period.
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SECTION 3.8. Fees and Commissions. The Purchaser represents and warrants
that it has retained, or otherwise authorized to act, no Intermediary in
connection with the transactions contemplated by this Agreement and agrees to
indemnify and hold harmless the Company from liability for any compensation to
any Intermediary retained or otherwise authorized to act by, or on behalf of,
the Purchaser and the fees and expenses of defending against such liability or
alleged liability.
SECTION 3.9. [Reserved].
SECTION 3.10. Restructuring of Debt. At the election of the Board of
Directors of the Company, the Purchaser shall (a) prior to the Closing Date, use
its reasonable efforts to; and (b) after the Closing Date, provide alternative
financing facilities to the Company's financing facilities that are in effect at
the time of such election by the Board of Directors.
SECTION 3.11. Wafer Purchase Commitment. The Purchaser hereby
acknowledges that it is obligated to purchase wafers from the Company in
accordance with Section 3.11 of the stock purchase agreement between the Company
and the Purchaser dated October 8, 1999.
ARTICLE 4
CONDITIONS TO OBLIGATIONS OF THE PURCHASER
SECTION 4.1. Conditions to Obligations of the Purchaser. The obligation
of the Purchaser on the Closing Date to purchase the Purchased Shares under this
Agreement shall be subject to each of the following conditions precedent, any
one or more of which may be waived by the Purchaser:
(a) Representations and Warranties. The representations and warranties
made by the Company herein shall be true and accurate in all material respects
on and as of the Closing Date.
(b) Performance. The Company shall have performed and complied with all
agreements and conditions contained herein or in other ancillary documents
incident to the transactions contemplated by this Agreement required to be
performed or complied with by it prior to the Closing in all material respects.
(c) Consents, etc. The Company shall have secured all permits, consents
and authorizations that shall be necessary or required lawfully to consummate
this Agreement, to issue the Purchased Shares to be purchased by the Purchaser.
(d) Compliance Certificates. The Company shall have delivered to the
Purchaser or its representative at the Closing an Officer's Certificate to the
effect that, to such Officer's knowledge, all conditions specified in Sections
4.1(a) through (c), inclusive, have been fulfilled.
(e) Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated by this Agreement and all
documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the
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Purchaser and its counsel, and the Purchaser and its counsel shall have received
all such counterpart originals or certified or other copies of such documents as
the Purchaser or its counsel may reasonably request.
(f) Opinion of Company's Counsel. On the Closing Date, the Purchaser
shall have received from Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP, counsel for the
Company, an opinion, dated the Closing Date, reasonably satisfactory in form and
substance to the Purchaser and its counsel, and in the form attached hereto as
Exhibit A.
(g) Shareholder and Governmental Approval. The Company agrees to use its
reasonable efforts to prepare a proxy statement, obtain the necessary approvals
from its stockholders, to obtain all applicable Governmental Approvals and to
amend and restate the Certificate of Incorporation to incorporate Section 6.6 of
this Agreement.
(h) Incumbency Certificate. The Company shall provide a certificate
dated the Closing Date of the Secretary or Assistant Secretary of the Company
certifying and attaching as exhibits thereto: (i) the Amended and Restated
Certificate of Incorporation; (ii) the By-laws; and (iii) the minutes of the
Board of Directors approving the execution, delivery and performance of this
Agreement.
ARTICLE 5
CONDITIONS TO OBLIGATIONS OF COMPANY
SECTION 5.1. Conditions to Obligations of the Company. The obligation of
the Company at the Closing to issue and sell the Purchased Shares to be
purchased under this Agreement shall be subject to the following conditions
precedent, which may be waived by the Company:
(a) Representations and Warranties. The representations and warranties
made by the Purchaser herein shall be true and accurate in all material respects
on and as of the Closing Date.
(b) Performance. The Purchaser shall have performed and complied with
all agreements and conditions contained herein or in other ancillary documents
incident to the transactions contemplated by this Agreement required to be
performed or complied with by it prior to or at the Closing in all material
respects.
(c) Compliance Certificates. The Purchaser shall have delivered to the
Company or its representative at the Closing an Officer's Certificate to the
effect that, to such Officer's knowledge, all conditions specified in Sections
5.1(a) and (b) have been fulfilled.
(d) Consents of Creditors. The Company shall have received consents from
Copelco Capital, Inc., Lyon Credit Corporation, and CIT Group/Credit Finance,
Inc. with respect to the Company executing, delivering and performing this
Agreement.
(e) Bridge Financing. Within 14 days of a request by the Company (which
request shall be made between the date hereof and the Closing Date), the
Purchaser, and/or its
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Affiliates (as defined below), shall lend the Company up to the amount of the
Purchase Price upon commercially reasonable terms, which amount shall be repaid
from the Purchase Price at Closing; provided, however, that (i) between the date
hereof and the date upon which the conditions of Section 4.1(g) are satisfied,
the Purchaser and/or its Affiliates shall be required to use their reasonable
efforts to fulfill their obligations under this Section 5.1(e) and (ii) after
the date on which the conditions of Section 4.1(g) are satisfied, the Purchaser
and/or its Affiliates shall be obligated to satisfy the conditions of this
Section 5.1(e).
For the purposes of this Agreement, "Affiliate" shall mean, with respect
to any natural person or entity ("Person"): (i) each Person that, directly or
indirectly, owns or controls, whether beneficially, or as a trustee, guardian or
other fiduciary, five percent (5%) or more of the capital stock having ordinary
voting power in the election of directors of such Person; (ii) each Person that
controls, is controlled by or is under common control with such Person or any
Affiliate of such Person; or (iii) each of such Person's officers, directors,
joint ventures and partners. For the purpose of this definition, "control" of a
Person shall mean the possession, directly or indirectly, of the power to direct
or cause the direction of its management or policies, whether through the
ownership of voting securities, by contract or otherwise.
ARTICLE 6
AFFIRMATIVE COVENANTS
SECTION 6.1. Preparation of Proxy Statement: Stockholders' Meeting.
Promptly following the date of this Agreement, the Company shall prepare and
file with the SEC a proxy statement relating to the meeting of the Company's
stockholders to be held in connection with this Agreement (the "Proxy
Statement"). Purchaser shall be entitled to review drafts of, and comment upon
the Proxy Statement, and the Company shall in good faith consider such comments.
The Company shall use its reasonable efforts to cause the Proxy Statement to be
mailed to the Company's stockholders as promptly as possible.
The Company, acting through its Board of Directors, shall, in accordance
with its Certificate of Incorporation and Bylaws promptly and duly call, give
notice of, convene and hold as soon as practicable, a meeting (the "Stockholders
Meeting") of the Company's stockholders for the purpose of voting to approve and
adopt this Agreement and the transactions contemplated hereby, and, subject to
the exercise of the Board of Director's fiduciary duties, (i) recommend approval
and adoption of this Agreement by the stockholders of the Company and include in
the Proxy Statement such recommendation; and (ii) take all reasonable and lawful
action to solicit and obtain such approval.
SECTION 6.2. Piggy-Back Registrations. If at any time the Company shall
determine to register for its own account or the account of others under the
Securities Act any of its equity securities, other than on Form S-8 or Form S-4
or their then equivalents (a "Piggy-Back Registration"), it shall send to the
Purchaser, written notice of such determination and, if within fifteen (15) days
after receipt of such notice, the Purchaser shall so request in writing, the
Company shall use its diligent efforts to include in such registration statement
all or any part of the Registrable Shares (as defined below) the Purchaser
requests to be registered, except that if, in connection with any offering
involving an underwriting of Common Stock to be issued by the Company, the
managing underwriter shall impose a
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limitation on the number of shares of Common Stock which may be included in the
registration statement because, in its judgment, such limitation is necessary to
effect an orderly public distribution, then the Company shall be obligated to
include in such registration statement only such limited portion (or none, if so
required by the managing underwriter) of the Registrable Shares with respect to
which such Holder has requested inclusion hereunder. For the purposes of this
Section, "Registrable Shares" shall mean and include (i) Purchased Shares held
by the Purchaser; (ii) the shares of Common Stock of the Company purchased by
Purchaser under the terms of the Stock Purchase Agreement dated as of October 8,
1999 between the Purchaser and the Company, and (iii) any shares of Common Stock
issued to (or issuable upon exercise of warrants issued to) any bank or other
lender, or equipment lessor in connection with the Company obtaining a loan or
equipment financing, if the Company expressly accords to such shares the
registration rights contained in this Agreement; provided, however, that shares
of Common Stock which are Registrable Shares shall cease to be Registrable
Shares upon the consummation of any sale of such shares pursuant to a
registration statement or Rule 144 under the Securities Act.
SECTION 6.3. Registrations on Form S-1 or Form S-3. In addition to the
rights provided the Purchaser in Section 6.1 above, if the registration of
Registrable Shares under the Securities Act can be effected on Form S-1 or Form
S-3 (or any equivalent successor form promulgated by the Commission), then the
Company shall provide the Purchaser with the following rights:
(a) For the Purchaser. Upon the written request of the Purchaser, the
Company shall so notify Purchaser, and then shall, as expeditiously as possible,
use its diligent efforts to effect qualification and registration under the
Securities Act on Form S-1 or Form S-3 of all or such portion of the Registrable
Shares as the Purchaser shall specify; provided, however, the Company shall not
be required to effect a registration pursuant to this Section 6.3(a) unless the
market value of the Registrable Shares to be sold by the Purchaser in any such
registration shall be at least $2,000,000 at the time of filing such
registration statement, and further provided that the Company shall not be
required to effect (i) any registration during the first six (6) months
immediately following the Closing Date; (ii) a registration during the three (3)
months thereafter pursuant to this Section 6.3(a) unless the Registrable Shares
are less than twenty percent (20%) of the Purchased Shares; (iii) a registration
during each three(3) month period thereafter pursuant to Section 6.3(a) unless
the Registrable Shares are less than twenty percent (20%) of the then-remaining
Purchased Shares; and (iv) more than five registrations in the aggregate
pursuant to this Section 6.3(a).
(b) Conflicts. In the event that, in a registration under this Section
6.3 which is effected through an underwriter, the underwriter imposes a
limitation on the number of Registrable Shares which may be included in the
registration statement in order to effect an orderly public distribution, then
the Company shall exclude from such registration statement, first, all shares
which are not Registrable Shares, and second, Registrable Shares which are
requested to be included pursuant to Section 6.2.
SECTION 6.4. Effectiveness. The Company will use its diligent efforts to
maintain the effectiveness for up to one hundred twenty (120) days (or such
shorter period of time as the
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underwriters need to complete the distribution of the registered offering, or
ninety (90) days in the case of a "shelf" registration statement on Form S-1 or
Form S-3) of any registration statement pursuant to which any of the Registrable
Shares are being offered, and from time to time will amend or supplement such
registration statement and the prospectus contained therein to the extent
necessary to comply with the Securities Act and any applicable state securities
statute or regulation. The Company will also provide the Purchaser with as many
copies of the prospectus contained in any such registration statement as it may
reasonably request.
SECTION 6.5. Right of First Offer.
(a) Subject to this Section 6.5 and other than as disclosed in Section
2.2(b), if the Company shall decide to issue or sell, any (i) shares of Common
Stock, (ii) any other equity security of the Company, including without
limitation, shares of Preferred Stock, (iii) any debt security of the Company
which by its terms is convertible into or exchangeable for any equity security
of the Company, (iv) any security of the Company that is a combination of debt
and equity, or (v) any option, warrant or other right to subscribe for, purchase
or otherwise acquire any such equity security or any such debt security of the
Company, the Company shall, in each case, first offer to sell such securities
(the "Offered Securities") to the Purchaser and its Affiliates (the "Preemptive
Stockholders"), if they (collectively) hold at least 40% (forty percent) of the
then outstanding capital stock of the Company, as follows: the Company shall
offer to sell to the Preemptive Stockholders that portion of the Offered
Securities as the number of shares of Common Stock which the Preemptive
Stockholders then hold or have the right to acquire bears to the sum of the
total number of issued and outstanding shares of Common Stock and upon exercise
of warrants, options and rights outstanding, at a price and on such other terms
as shall have been specified by the Company in writing delivered to the
Preemptive Stockholders (the "Offer"), which Offer by its terms shall remain
open for a period of 14 days from the giving of the Offer.
(b) Notice of the Preemptive Stockholders' intention to accept, in whole
or in part, any Offer made pursuant to clause (a) shall be evidenced by a
writing signed by the Preemptive Stockholders and delivered to the Company prior
to the end of the 14-day period of such Offer, setting forth the number of
shares or securities the Preemptive Stockholders elect to purchase (the "Notice
of Acceptance"). Failure of the Preemptive Stockholders to deliver a Notice of
Acceptance within said 14 days will be deemed to be a rejection of the Offer.
(c) The Company shall have one hundred twenty (120) days from the end of
said 14-day period to sell any such Offered Securities as to which a Notice of
Acceptance has not been given (the "Refused Securities") to any Person or
Persons, substantially on the same terms and conditions as set forth in the
Offer.
(d) The rights of the Preemptive Stockholders under this Section 6.5
shall terminate for all future issuances of Offered Securities upon the earlier
of (i) two (2) years after the Closing Date; and (ii) any date on which
Purchaser and/or its Affiliates hold less than forty percent (40%) of the
then-outstanding capital stock of the Company.
(e) The rights of the Preemptive Stockholders under this Section 6.5
shall not apply to:
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(i) Common Stock issued as a stock dividend to holders of Common
Stock or upon any subdivision or combination of shares of Common Stock;
(ii) Preferred Stock issued as a dividend to holders of Preferred
Stock or upon any subdivision or combination of shares of Preferred Stock;
(iii) Common Stock issued upon exercise of options, warrants and
rights outstanding as of the date of this Agreement;
(iv) Common Stock and options of the Company issued after the
date hereof to directors, officers, employees or consultants of the Company and
any Subsidiary pursuant to any qualified or non-qualified stock option plan,
employee stock ownership plan, employee benefit plan, stock plan, or such other
options, arrangements, agreements or plans intended principally as a means of
providing compensation or incentive compensation for employment or services,
approved by the Board of Directors of the Company;
(v) Options, warrants or shares issued to banks or other lenders
or equipment lessors in connection with the Company obtaining loans or equipment
financing or to customers, prospective customers, vendors or strategic partners;
or
(vi) Securities issued in a merger or consolidation or as
consideration for the acquisition by the Company of any other corporation or
other business entity or of the assets and business thereof.
(f) For convenience in administration, the Company may offer and sell
Securities covered by the right in clause (a) without first offering such
Securities to the Preemptive Stockholders, so long as the Preemptive
Stockholders are given the opportunity to purchase their pro rata amount within
45 days after the close of the sale of Securities.
(g) The rights of the Preemptive Stockholders set forth herein are
nonassignable except (i) to any or all of the beneficial owners of the
Preemptive Stockholders; (ii) an Affiliate of the Preemptive Stockholders; and
(iii) to a purchaser who is not a competitor of the Company and who purchases
all of the Preemptive Stockholders' Securities of the Company. Any assignee
permitted under the preceding sentence shall assume the assignor's obligations
under this Agreement and become a party to this Agreement in a manner reasonably
satisfactory to the Company.
SECTION 6.6. Additional Purchases By Purchaser. Unless approved by the
Board of Directors unanimously, if, on any day other than the Closing Date, the
Purchaser and/or its Affiliates elect to purchase shares of Common Stock that
would result in the Purchaser or its affiliates holding more than 51% of the
fully diluted Common Stock pursuant to a purchase of stock, a purchase of
assets, a merger or a combination, or any other form of acquisition, such
additional purchase shall be subject to the vote of the stockholders of the
Company and shall be approved if at least fifty-one percent (51%) of the
stockholders vote in favor of the transaction and no more than twenty percent
(20%) of the stockholders vote against such transaction. Notwithstanding the
foregoing, the provisions of this Section 6.6 shall terminate at such time
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as the Purchaser and/or its Affiliates have acquired equal to or greater than
75% of the outstanding Common Stock of the Company.
SECTION 6.7. Employee Retention Plan. The Company and the Purchaser
agree that after the Closing hereunder, the Company shall, subject to Board of
Directors approval, set aside an additional 1,000,000 shares of Common Stock of
the Company in order to grant options in the form of qualified or non-qualified
Common Stock option grants to certain Company employees pursuant to a key
employee retention plan.
SECTION 6.8. Purchaser's Board of Directors Designee. Promptly after the
Closing Date, the Company's Board of Directors shall take the necessary steps to
add one person designated by the Purchaser as a member of the Company's Board of
Directors. The parties agree to promptly designate any person whom the Company
names as CEO in the future as a member of the Board. The parties further agree
that in the event that Xxxxxxx Xxxxxxxxxxxxx ceases to serve as a member of the
Board, Xxx Xxxxxxx may, in his sole discretion and as long as he is still
serving as a member of the Board, designate a person to replace Xx.
Xxxxxxxxxxxxx as a member of the Board.
ARTICLE 7
MISCELLANEOUS
SECTION 7.1. Survival of Agreements. All agreements, representations and
warranties contained herein or made in writing by or on behalf of the Company in
connection with the transactions contemplated hereby shall survive the execution
and delivery of this Agreement.
SECTION 7.2. Notices. All notices, requests, consents and other
communications herein (except as stated in the last sentence of this Section
7.2) shall be in writing and shall be mailed by first-class certified mail,
postage prepaid and return receipt requested, personally delivered, faxed, or
sent by recognized overnight courier service, as follows:
(a) If to the Company:
IMP, Inc.
0000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx X.X.X. 00000-0000
Attention: Chief Executive Officer
Fax: (000) 000-0000
With a copy to
Xxxxxxx Xxxx, Esq.
Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP
Old Federal Reserve Bank Building
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-0000
Fax: (000) 000-0000
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(b) If to the Purchaser:
Teamasia Semiconductors PTE Ltd.
XXX Xxxxxxxx, XX Xxx 000
Xxxxxxxxx 00000
With a copy to:
Xxxxxx X. Xxxxxxxx, Inc.
0000 Xxxxxxxxx Xxx., Xxxxx 000
Xxx Xxxx, Xxxxxxxxxx 00000
Fax: (000) 000-0000
or such other addresses as each of the parties hereto may provide from time to
time in writing to the other parties.
SECTION 7.3. Modifications; Waiver. Neither this Agreement nor any
provision hereof may be changed, waived, discharged or terminated orally or in
writing, except that any provision of this Agreement may be amended and the
observance of any such provision may be waived (either generally or in a
particular instance and either retroactively or prospectively) with (but only
with) the written consent of the party to be charged.
SECTION 7.4. Exculpation. The Purchaser acknowledges that it is not
relying upon any statements or instruments made or issued by any person, firm or
corporation, other than those contained in this Agreement in making its decision
to invest in the Company.
SECTION 7.5. Entire Agreement. This Agreement, together with the
schedules and exhibits attached hereto and the officer's certificate and
financial statements delivered pursuant hereto and made a part hereof, contains
the entire agreement between the parties with respect to the transactions
contemplated hereby, and supersedes all negotiations, agreements,
representations, warranties and commitments, whether in writing or oral, prior
to or contemporaneous with the Closing Date.
SECTION 7.6. Successors and Assigns. Except as otherwise expressly
provided in this Agreement, all of the terms of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto.
SECTION 7.7. Enforcement.
(a) Remedies at Law or in Equity. If the Company shall default in any of
its obligations under this Agreement or if any representation or warranty made
by or on behalf of the Company in this Agreement or in any certificate, report
or other instrument delivered under or pursuant to any term hereof shall be
untrue or misleading in any material respect as of the date of this Agreement or
as of the Closing or as of the date it was made, furnished or delivered, the
Purchaser may proceed to protect and enforce its rights, including by way of
suit in equity or action at law. In the event the Purchaser brings such an
action against the Company, the prevailing party in such dispute shall be
entitled to recover from the losing party
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all fees, costs and expenses of enforcing any right of such prevailing party
under or with respect to this Agreement, including without limitation such
reasonable fees and expenses of attorneys and accountants, which shall include,
without limitation, all fees, costs and expenses of appeals.
(b) Remedies Cumulative; Waiver. No remedy referred to herein is
intended to be exclusive, but each shall be cumulative and in addition to any
other remedy referred to above or otherwise available to a party at law or in
equity. No express or implied waiver by Purchaser of any default shall be a
waiver of any future or subsequent default. The failure or delay of any party in
exercising any rights granted it hereunder shall not constitute a waiver of any
such right and any single or partial exercise of any particular right by a party
shall not exhaust the same or constitute a waiver of any other right provided
herein.
SECTION 7.8. Execution and Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed and delivered
shall be deemed an original, and all such counterparts together shall constitute
one instrument. Each party shall receive a duplicate original of the counterpart
copy or copies executed by it and by the Company.
SECTION 7.9. Governing Law and Severability. (a) This agreement shall be
governed by the internal laws of the state of California, without regard to
principles of conflicts of law. Each of the parties hereto hereby submits to the
exclusive jurisdiction of the United States District Court in San Francisco,
California, for purposes of all legal proceedings arising out of or relating to
this Agreement or the transactions contemplated hereby. Each of the parties
hereto waives any objection which it may now or hereafter have to the laying of
the venue of any such proceeding brought in such a court and any claim that any
such proceeding brought in such a court has been brought in an inconvenient
forum.
(b) In the event any provision of this agreement or the application of
any such provision to any party shall be held by a court of competent
jurisdiction to be contrary to law, the remaining provisions of this agreement
shall remain in full force and effect.
SECTION 7.10. Headings. The descriptive headings of the Articles and
Sections hereof and the Schedules and Exhibits hereto are inserted for
convenience only and do not constitute a part of this Agreement.
SECTION 7.11. Confidentiality. The Purchaser agrees that it will keep
confidential and will not disclose, or divulge any confidential, proprietary,
secret or non-public information which the Purchaser may obtain from the Company
and not use such information other than for the benefit of the Company or in
furtherance of the Purchaser's rights as a shareholder of the Company; provided,
that, no such information shall be deemed to be non-public if it (i) is or
becomes generally available to the public other than as a result of a disclosure
by the Purchaser or its respective agents, representatives or employees; (ii) is
or becomes available to the Purchaser on a non-confidential basis from a source
(other than the Company or one of its officers, directors, agents,
representatives or employees) that is not prohibited from disclosing such
information by a legal, contractual or fiduciary obligation; or (iii) was known
to the Purchaser on a non-confidential basis prior to its disclosure to it by
the Company and provided
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further that, any other term of this Agreement to the contrary notwithstanding,
the Company shall not be obligated to disclose any information, the disclosure
of which it believes in good faith would be detrimental to the Company or its
stockholders.
SECTION 7.12. [Reserved.]
SECTION 7.13. [Reserved.]
SECTION 7.14. Indemnification.
(a) The Company agrees to indemnify and hold harmless the Purchaser from
and against any and all liabilities, obligations, losses, out-of-pocket costs or
damages ("Loss") and reasonable attorneys' and accountants' fees and expenses,
court costs and all other reasonable out-of-pocket expenses ("Expense") incurred
by the Purchaser in connection with or arising from or attributable to any
breach by the Company, of any of its representations, warranties, obligations,
covenants or agreements contained in this Agreement; provided, however, that the
Purchaser shall not be entitled to indemnification for Losses or Expenses
pursuant to this Section unless and until the amount of Losses and Expenses
exceeds $100,000. Thereafter, the Company shall be liable for indemnification
for Losses and Expenses only to the extent the aggregate amount thereof exceeds
$100,000. Notwithstanding the foregoing, the terms "Loss" and "Expense" shall
not include incidental, consequential or punitive damages except in a third
party claim, action or suit.
(b) If the Purchaser believes that it has suffered or incurred any Loss
or Expense pursuant to this Section, it shall so notify the Company promptly in
writing describing such Loss or Expense, the amount thereof, if known, and the
method of computation of such Loss or Expense. Promptly after receipt by the
Purchaser of notice of the commencement of any action by any third party, such
indemnified party shall, if a claim in respect thereof is to be made against the
Company under this Section notify the Company in writing of the commencement
thereof (but the failure so to notify the Company shall not relieve the Company
from any liability which it may have under this Section except to the extent
that it has been prejudiced in any material respect by such failure or from any
liability which it might otherwise have). Unless the Company is contesting a
third party claim, the Company shall promptly pay such claim or reimburse the
Purchaser if the Purchaser has made payment.
(c) The Company shall have the right to conduct and control, through
counsel of its choosing, any third party claim, action or suit. The Company
shall permit the Purchaser to participate in the defense of any such action or
suit through counsel chosen by it, provided that the fees and expenses of such
counsel shall be borne by the Purchaser. The Company may agree to any compromise
or settlement with respect to a claim for money damages without the consent of
the Purchaser; provided, that the Company shall not effect any compromise or
settlement which will have a continuing effect on the business of the Purchaser
without the prior consent of the Purchaser, which consent shall not be
unreasonably withheld or delayed.
SECTION 7.15. [Reserved].
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SECTION 7.16. Expenses. The parties shall each pay their own legal,
accounting and financial advisory fees and other out-of-pocket expenses related
to the negotiation, preparation and carrying out of this Agreement and the
transactions herein contemplated.
[The rest of this page left intentionally blank.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized officers as of the date first above written.
IMP, INC.
By: /s/ XXX XXXXXXX
---------------------------------
Name: XXX XXXXXXX
---------------------------
Title: PRESIDENT & CEO
---------------------------
TEAMASIA SEMICONDUCTORS PTE LTD.
By: /s/ XXXXX XXX PINAMANENI
---------------------------------
Name: XXXXX XXX PINAMANENI
---------------------------
Title: MANAGING DIRECTOR
---------------------------
STOCK PURCHASE AGREEMENT SIGNATURE PAGE
