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STOCK PURCHASE AGREEMENT
by and among
Factory Automation & Computer Technologies, Inc.
Warburg, Xxxxxx Investors, L.P.
and
Xxxxx Xxxxxxxxxx
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Dated as of
May 10, 1994
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STOCK PURCHASE AGREEMENT
This Agreement is made and entered into as of this 10th day of May,
1994, by and among Factory Automation & Computer Technologies, Inc., a New York
corporation (the "Company"), Warburg, Xxxxxx Investors, L.P., a Delaware limited
partnership ("Warburg"), and Xxxxx Xxxxxxxxxx ("Xxxxxxxxxx").
In consideration of the mutual promises, covenants and conditions
hereinafter set forth, the parties hereby agree as follows:
SECTION 1. AUTHORIZATION OF CAPITAL STOCK
(a) The Company's Board of Directors has authorized the filing
of a Certificate of Amendment to the Certificate of Incorporation (the "Amended
Certificate") in the form of Exhibit A annexed hereto, authorizing 5,000,000
shares of Common Stock, par value $.01 per share (the "Voting Common Stock"),
and 3,000,000 shares of Class A Common Stock, par value $.01 per share (the
"Nonvoting Common Stock"), and creating two new series of preferred stock
consisting of 540,016 shares of Series B Preferred Stock, par value $1.00 per
share (the "Series B Preferred Stock"), and 2,376,651 shares of Series C
Preferred Stock, par value $1.00 per share (the "Series C Preferred Stock"). The
terms, limitations and relative rights and preferences of the Voting Common
Stock, the Nonvoting Common Stock, the Series B Preferred Stock and Series C
Preferred Stock are set forth in the Amended Certificate.
SECTION 2. PURCHASE AND SALE OF STOCK
2.1 Series B Preferred Stock; Series C Preferred Stock
Subject to the terms and conditions set forth in this Agreement and
in reliance upon the representations set forth below, on the Closing Date (as
defined below) the Company shall sell to Warburg, and Warburg shall purchase
from the Company at a purchase price equal to $2.40 per share, 540,016 shares of
Series B Preferred Stock and 2,376,651 shares of Series C Preferred Stock for an
aggregate purchase price of $7,000,000. Such sale and purchase shall be effected
on the Closing Date by the Company executing and delivering to Warburg, duly
registered in Warburg's name, duly executed stock certificates evidencing the
Series B Preferred Stock and the Series C Preferred Stock to be purchased
hereunder, against delivery by Warburg to the Company of (a) that certain
$150,000 promissory note made by the Company in favor of Warburg, which note
shall be cancelled and deemed paid in full, and (b) $6,849,167 in cash by wire
transfer or the delivery of a check in such amount payable to the order of the
Company.
2.2 Use of Proceeds from Investment.
(a) The Company shall use the proceeds from Warburg's
investment as follows:
(i) $1,966,570 shall be used to purchase 829,833
shares of the Company's Convertible Class A Preferred Stock, par
value $1.00 per share (the "Series A Preferred Stock"), and warrants
(the "Warrants") to purchase 312, 461 shares of Series A Preferred
Stock and 4,167 shares of Voting Common Stock, held by Aspen Venture
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Partners L.P. pursuant to the terms of the Aspen Securities Purchase
Agreement in the form of Exhibit B annexed hereto;
(ii) $524,304 shall be used to purchase 291,280
shares of Voting Common Stock held by Gabor Fulup ("Fulup");
(iii) $348,750 shall be used to purchase options to
purchase 225,000 shares of Voting Common Stock held by Xxxxxx
Xxxxxxxxx ("Xxxxxxxxx");
(iv) $34,200 shall be used to purchase 19,000 shares
of Voting Common Stock held by Xxxxxxxxx Xxxxxxx ("Xxxxxxx");
(v) $34,200 shall be used to purchase 19,000 shares
of Voting Common Stock held by Xxxxxxx Xxxxxx ("Xxxxxx"); and
(vi) $4,091,976 shall be used by the Company as
working capital.
2.3 Closing.
The closing of the sale and purchase referred to in Section 2.1 (the
"Closing") shall take place at 10:00 A.M., New York City time, on May 11, 1994,
or such other date as Warburg and the Company may mutually agree in writing (the
"Closing Date"), at the offices of Xxxxxxx Xxxx & Xxxxxxxxx, 153 East 53rd
Street, New York, New York, or such other location as Warburg and the Company
shall mutually select.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Warburg that:
3.1 Organization.
(a) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of New York. Annexed
hereto as Exhibits C and D, respectively, are true and complete copies of the
Certificate of Incorporation (the "Certificate of Incorporation") and By-Laws
(the "By-Laws") of the Company, each as amended through the date hereof.
(b) The Company has all requisite corporate power and
authority and has all necessary governmental approvals, licenses, permits and
authorizations to own its properties and to carry on its business as now
conducted, except where the failure to have any such approval, license, permit
or authorization could not reasonably be expected to have a material adverse
effect on the business, financial position or prospects of the Company.
3.2 Subsidiaries.
The Company does not own, directly or indirectly, any capital stock
or other equity securities of any corporation nor does it have any direct or
indirect ownership interest in any business. The Company is not a participant in
any joint venture or partnership.
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3.3 Capital Stock.
(a) On the date hereof, the authorized capital stock of the
Company consists of 3,500,000 shares of Voting Common Stock and 2,500,000 shares
of Series A Preferred Stock, of which 869,396 shares of Voting Common Stock and
829,833 shares of Series A Preferred Stock are outstanding. On the Closing Date,
after giving effect to the transactions contemplated hereby (including the
transactions contemplated by the Aspen Securities Purchase Agreement and the
agreements to repurchase Company Securities held by Fulup, Xxxxxxxxx, Xxxxxxx
and Xxxxxx (collectively, the "Securities Purchase Agreements")) the authorized
capital stock of the Company will consist of 5,000,000 shares of Voting Common
Stock, 3,000,000 shares of Nonvoting Common Stock, 540,016 shares of Series B
Preferred Stock and 2,376,651 shares of Series C Preferred Stock, of which
540,116 shares of Voting Common Stock, 540,016 shares of Series B Preferred
Stock and 2,376,651 shares of Series C Preferred Stock will be outstanding.
(b) Under each of the Company's Incentive Stock Option Plan
and Nonqualified Stock Option Plan, each as amended through the date hereof
(collectively, the "Stock Option Plans") there are 650,000 shares of Voting
Common Stock reserved for issuance upon exercise of stock options granted
thereunder. As of the date hereof and prior to the transactions contemplated
herein, there are incentive stock options to purchase an aggregate of 561,150
shares of Voting Common Stock outstanding and nonqualified stock options to
purchase an aggregate of 352,500 shares of Voting Common Stock outstanding. The
holders of such options and the number of options held are set forth on Schedule
3.3 hereto.
(c) Schedule 3.3 sets forth a complete list of the holders of
the Company's Voting Common Stock, Series A Preferred Stock and Warrants and the
number of shares beneficially owned by such holders as of the date hereof and
prior to the transactions contemplated herein.
3.4 Authorization.
(a) The Board of Directors of the Company has authorized the
execution, delivery and performance of this Agreement, the Shareholders'
Agreement (as defined herein), the Securities Purchase Agreements, the RPI
Preemptive Rights Termination Agreement (as defined herein) and each of the
transactions contemplated hereby and thereby including, without limitation,
authorization of the execution and filing of the Amended Certificate,
authorization of the issuance and delivery of the shares of Series B Preferred
Stock and Series C Preferred Stock in accordance with this Agreement and the
authorization of the amendment and restatement of the Company's by-laws (the
"Amended and Restated By-Laws") in the form of Exhibit E annexed hereto. Except
for the action by the Board of Directors described in the preceding sentence and
the shareholder action contemplated by Section 5.4, no other corporate action is
necessary to authorize the performance by the Company of its obligations
hereunder or under the Shareholders' Agreement or the Aspen Securities Purchase
Agreement.
(b) This Agreement, the Shareholders' Agreement, the
Securities Purchase Agreements and the RPI Preemptive Rights Termination
Agreement each constitute the valid and binding obligation of the Company,
enforceable against the Company in accordance with their respective terms.
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3.5 Valid Issuance.
(a) All outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid and
nonassessable. Except as set forth on Schedule 3.3 hereto or as contemplated by
this Agreement, the Amended Certificate and the Shareholders' Agreement and
after giving effect to the transactions contemplated by the Securities Purchase
Agreements, there are no shares of capital stock issuable upon conversion of any
security of the Company nor are there any rights, options or warrants
outstanding or other agreements to acquire shares of capital stock nor is the
Company contractually obligated to purchase, redeem or otherwise acquire any of
its outstanding shares of capital stock. Except as contemplated herein and in
the Shareholders' Agreement and after giving effect to the RPI Preemptive Rights
Termination Agreement, no shareholder of the Company is entitled to any
preemptive rights, rights of first refusal, redemption rights or similar rights.
(b) Upon issuance, sale and delivery as contemplated by this
Agreement, the shares of Series B Preferred Stock and Series C Preferred Stock
to be sold to Warburg under this Agreement will be duly authorized, validly
issued, fully paid and nonassessable shares of the Company, and free of
preemptive rights.
(c) Upon their issuance in accordance with the terms of the
Series B Preferred Stock and the Series C Preferred Stock, respectively, the
shares of Voting Common Stock issuable upon conversion of the Series B Preferred
Stock and the shares of Nonvoting Common Stock issuable upon conversion of the
Series C Preferred Stock will be duly authorized, validly issued, fully paid and
nonassessable shares of the Company, and free of preemptive rights.
(d) Upon their issuance in accordance with the terms of the
Nonvoting Common Stock, the shares of Voting Common Stock issuable upon
conversion of the Nonvoting Common Stock will be duly authorized, validly
issued, fully paid and nonassessable shares of the Company, and free of
preemptive rights.
3.6 No Consents Required; No Violation of Laws.
Neither the nature of the business which the Company conducts,, nor
any relationship between the Company and any other Person, nor any circumstance
in connection with the creation, authorization, issuance, offer or sale of the
Voting Common Stock, the Nonvoting Common Stock, the Series B Preferred Stock or
the Series C Preferred Stock as contemplated by this Agreement is such as to
require a consent, approval or authorization of, or filing, registration or
qualification with, any Person or any governmental authority on the part of the
Company, except for state and Federal securities law filings, or the vote,
consent or approval of the holders of any Security (as defined in Section 9) of
the Company as a condition to the execution and delivery of this Agreement or
the authorization, issuance, offer and sale of the Voting Common Stock, the
Nonvoting Common Stock, the Series B Preferred Stock or the Series C Preferred
Stock hereunder.
3.7 Qualification To Do Business.
The Company has filed all necessary documents to qualify to do
business as a foreign corporation in, and the Company is in good standing under
the laws of, each jurisdiction
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listed in Schedule 3.7 hereto, and such jurisdictions constitute the only
jurisdictions in which the conduct of the Company's business or the nature of
the property owned or leased by it require it to qualify to do business as a
foreign corporation, except where the failure to so qualify would not have a
material adverse effect on the business, financial position or prospects of the
Company.
3.8 Absence of Defaults. Conflicts. etc.
The execution and delivery of this Agreement, the Securities Purchase
Agreements and the Shareholders' Agreement, the authorization, issuance, offer
and sale of the Voting Common Stock, the Nonvoting Common Stock, the Series B
Preferred Stock and the Series C Preferred Stock contemplated hereby, the
adoption by the Board of Directors of the Company of the Amended Certificate and
the Amended and Restated By-Laws and the fulfillment of the terms hereof and
thereof by the Company, will not (A) result in a breach of any of the terms,
conditions or provisions of, or constitute a default under, or permit the
acceleration of rights under or termination of, any indenture, mortgage, deed of
trust, credit agreement, note or other evidence of indebtedness, or other
agreement of the Company, or (B) violate the Certificate of Incorporation or
Amended Certificate or By-Laws or Amended and Restated By-laws of the Company,
or any rule or regulation of any court or Federal or state or other regulatory
board or body or administrative agency having jurisdiction over the Company or
over its properties or businesses. No event has occurred and no condition exists
which, upon notice or the passage of time, or both, would constitute a default
under any such agreements and instruments or in any license, permit or
authorization to which the Company is a party or by which it may be bound.
3.9 Financial Statements. Material Liabilities.
(a) The Company has previously delivered to Warburg its
balance sheet as at December 31, 1993, and the related statement of income for
the year then ended, in each case compiled by the Company. (the "Financial
Statements"). Such Financial Statements, Including the notes thereto, have been
prepared from the books and records of the Company and present fairly the
financial position and the results of operations and cash flows of the Company
as at and for the periods indicated, in each case in conformity with generally
accepted accounting principles ("GAAP") consistently applied.
(b) The Company has previously delivered to Warburg its
interim balance sheet of the Company as at March 31, 1994 and statement of
income for the three months then ended. Such interim financial Statements have
been prepared from the books and records of the Company and, subject to
customary year end adjustments, present fairly the financial position and the
results of operations of the Company as at and for the period indicated.
(c) Except as set forth in the Financial Statements and the
interim statements described in Section 3.9(b), the Company has no material
liabilities or obligations, absolute or contingent, except (i) obligations and
liabilities incurred in the ordinary course of business since the respective
dates of such statements, none of which is material, (ii) obligations which are
not required to be reflected in the Financial Statements or such interim
statements, or (iii) as set forth on Schedule 3.9.
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3.10 Absence of Certain Developments.
Since December 31, 1993, there has been no (i) material adverse
change in the condition, financial or otherwise, of the Company or in its
assets, liabilities, properties, or business or prospects, taken as a whole,
(ii) declaration, setting aside or payment of any dividend or other distribution
with respect to the capital stock of the Company or redemption of any share of
capital stock of the Company, (iii) issuance of any capital stock or options or
rights to acquire capital stock other than as set forth on Schedule 3.10 hereto,
(iv) material loss, destruction or damage to any property of the Company,
whether or not insured, (v) acceleration or prepayment of any indebtedness for a
material amount of borrowed money or the refunding of any such indebtedness,
(vi) labor trouble involving the Company or any material change in its personnel
or the terms and conditions of employment, (vii) waiver of any valuable right
which could reasonably be expected to have a material adverse effect on the
business, financial position or prospects of the Company, (viii) loan or
extension of credit by the Company to any officer or employee of the Company
(other than reasonable travel advances) or (ix) acquisition or disposition of
any material assets (or any contract or arrangement therefor) otherwise than for
fair value in the ordinary course of business, or any other transaction by the
Company otherwise than for fair value in the ordinary course of business.
3.11 Compliance with Law.
The Company is not in violation of any laws, ordinances, governmental
rules or regulations to which it is subject, including without limitation laws
or regulations relating to the environment or to occupational health and safety,
and to its knowledge no material expenditures are or will be required in order
to cause its current operations or properties to comply with any such law,
ordinances, governmental rules or regulations.
3.12 Pending Actions.
There is no action, suit, investigation or proceeding pending or, to
the knowledge of the Company threatened, against the Company or any of its
properties or assets by or before any court, arbitrator or governmental
authority which questions the validity of this Agreement, the Aspen Securities
Purchase Agreement, the Shareholders' Agreement, the Restated Certificate, the
Amended and Restated By-laws or any action taken or to be taken pursuant hereto
or thereto, or which could reasonably be expected to have a material adverse
effect on the business, financial position or prospects of the Company, and the
Company is not in default with respect to any judgment, order, writ, injunction,
decree, or award having applicability to it or its business or properties.
3.13 Tax Matters.
The provisions for taxes on the balance sheets described in Section
3.9 are adequate under GAAP to reflect the accrued liability in respect of all
accrued and unpaid Federal, state, county and local taxes of the Company whether
or not assessed or disputed as of the respective dates of such balance sheets.
The Company has completed and duly filed all Federal, state, county and local
tax returns required to have been filed by it and all taxes which are shown on
such returns have been paid (other than taxes contested in good faith by
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appropriate proceeding). There are in effect no waivers of applicable
statutes of limitations with respect to taxes for any year. No tax returns have
been audited by taxing authorities.
3.14 Employees.
Except as reflected on Schedule 3.14 hereto, the Company does not
have any employment contract with any of its employees (other than employment
agreements terminable by the Company without premium or penalty on notice of 30
days or less), or any collective bargaining agreements covering any of its
employees, nor has the Company been subject to any labor organization activity.
There are no material controversies or labor troubles pending or, to the
knowledge of the Company threatened, between the Company and any of its
employees. The Company has complied with all applicable federal and state laws
and regulations respecting employment and employment practices, terms and
conditions of employment, wages and hours and other laws related to employment.
Except as reflected on Schedule 3.14, there are no overdue arrears in the
payments of wages, withholding or social securities taxes, unemployment
insurance premiums or other similar obligations. Schedule 3.14 sets forth a
complete list of the employees currently working for the Company indicating
those who have executed confidentiality and non-disclosure agreements together
with the date on which such agreement was signed, and there is attached to such
Schedule a copy of the form(s) of agreement used for this purpose by the
Company. Except as listed on Schedule 3.14, no employee or consultant of the
Company has within the prior three months given any indication to the Company
that he or she intends to leave the employ of the Company or is considering
doing so, or is being terminated.
3.15 Employee Benefit Plans.
All employee benefit plans (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974 ("ERISA")) covering former and
current employees of the Company, or under which the Company has any obligation
or liability (each, a "Benefit Plan") are listed in Schedule 3.15. No Benefit
Plan is a multiemployer plan (as defined in Section 3(37) of ERISA) or is an
employee pension benefit plan, as defined in Section 3(2) of ERISA. The Benefit
Plans are and have been administered in substantial compliance with their terms
and with the requirements prescribed by ERISA (to the extent that ERISA applies)
and the applicable provisions of the Code. The Company has not incurred any
liability under Title IV of ERISA, including any liability to the Pension
Benefit Guaranty Corporation. No Benefit Plan provides retirement or other
post-termination benefits except as required under the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended or as discussed on Schedule 3.15.
No Benefit Plan has engaged in a transaction which would subject the Company to
a material tax, penalty or liability under the Code or ERISA. There is no
litigation pending or threatened with respect to any Benefit Plan. Schedule 3.15
lists all plans, contracts, bonuses, commissions, profit-sharing, savings, stock
options, insurance, deferred compensation, or other similar fringe or employee
benefits covering former or current employees of the Company or under which the
Company has any obligation or liability (each, a "Benefit Arrangement"). The
Benefit Arrangements are and have been administered in substantial compliance
with their terms and with the requirements of applicable law.
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3.16 Copyrights, Trademarks, Licenses. etc.
The Company owns, free and clear of all encumbrances, restrictions,
liens, security interests and charges, and has good and marketable title to, or
holds adequate licenses or otherwise possess all such rights (or such rights are
in the public domain) as are necessary to use all patents (and applications
therefor), patent disclosures, trademarks, service marks, trade names,
copyrights (and applications therefor), inventions, discoveries, processes,
know-how, scientific, technical, engineering and marketing data, software code,
formulae and techniques used or proposed to be used, in or necessary for the
conduct of its business as now Conducted or as proposed to be conducted.
Schedule 3.16 lists all patents, copyrights, trademarks, trade names or other
intellectual property rights held by the Company.
The Company has not received notice nor otherwise has knowledge of
any conflict or alleged conflict with the rights of others pertaining to the
tangible and intangible assets described in this Section 3.16. To the Company's
knowledge, the Company's business, as presently conducted, does not infringe
upon or violate any intellectual property rights or trade secrets of others. To
the Company's knowledge, the Company has the right to use, free and clear of any
rights or claims of others, all intellectual property and trade secrets,
processes, customer lists and other rights to the extent reasonably necessary
for the conduct of the Company's business as presently conducted.
The Company is not currently obligated or under any existing
liability to make royalty or other payments to any owner of, licensor of, or
other claimant to, any patent, trademark, service name, trade name, copyright,
or other intangible asset, with respect to the use thereof or in connection with
the conduct of its business as now conducted. To the Company's knowledge, no
employee of the Company is subject to any employment agreement or proprietary
information agreement which he or she had with a previous employer or any
intellectual property policy of such employer, which affects the rights of the
Company to use the technologies, patents, trademarks, trade secrets, service
names, trade names, copyrights, licenses and the like currently employed by the
Company, or is a party to or threatened by any litigation concerning any
patents, trademarks, trade secrets, service names, trade names, copyrights,
licenses and the like.
3.17 Title to Tangible Assets.
The Company has good title to its tangible properties and assets and
good title to all its leasehold estates, in each case subject to no mortgage,
pledge, lien, lease, encumbrance or charge, other than, or resulting from, taxes
which have not yet become delinquent and minor liens and encumbrances which do
not in any case materially detract from the value of the property subject
thereto or materially impair the operations of the Company.
3.18 Insurance.
Schedule 3.18 sets forth a true and complete listing of the insurance
policies of the Company as in effect on the date hereof. No notice of any
termination or threatened termination of any of such policies has been received
by the Company and such policies are in full force and effect.
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3.19 Transactions with Related Parties.
Except as disclosed on Schedule 3.19, the Company is not a party to
any agreement with any of the Company's officers, shareholders or directors or
any Affiliate of any of the foregoing under which it: (i) leases any real or
personal property (either to or from such person), (ii) has incurred any debt
for borrowed money or under which it has lent money (other than routine travel
advances), (iii) licenses technology (either to or from such person), (iv) is
obligated to purchase any tangible or intangible asset from or sell such asset
to such person, or (v) purchases products or services from such person (other
than pursuant to employment agreements described in Schedule 3.14).
3.20 Interest in Competitors.
Neither the Company nor to its knowledge any of its officers, has any
interest, either by way of contract or by way of investment (other than as
holder of not more than 5% of the outstanding capital stock of a publicly traded
Person) or otherwise, directly or indirectly, in any Person other than the
Company that (i) provides any services or designs, produces or sells any product
or product lines or engages in any activity similar to or competitive with any
activity currently conducted or proposed to be conducted by the Company or (ii)
has any direct or indirect interest in any asset or property, real or personal,
tangible or intangible, of the Company.
3.21 Registration Rights.
Except as set forth herein and after giving effect to the provisions
of the Aspen Securities Purchase Agreement, the Company is not under any
obligation to register any of its Securities under the Act.
3.22 Brokers, Finders.
There are no claims for brokerage commissions or finder's fees or
similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement made by or on behalf of the Company.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF WARBURG
Warburg represents and warrants to the Company that:
4.1 Authorization.
This Agreement constitutes the valid and binding obligation of
Warburg, enforceable against Warburg in accordance with its terms. The
execution, delivery and performance of this Agreement have been duly authorized
by all necessary action on the part of Warburg and all consents of any third
parties that may be required to be obtained by Warburg for the consummation of
the transactions contemplated hereby have been obtained.
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4.2 Investment for Own Account.
Warburg is acquiring the Series B Preferred Stock and the Series C
Preferred Stock purchased hereunder (and will acquire the Voting Common Stock
upon conversion of the Series B Preferred Stock, the Nonvoting Common Stock upon
conversion of the Series C Preferred Stock and the Voting Common Stock upon
conversion of the Nonvoting Common Stock) for its own account for investment and
not with a view towards the resale, transfer or distribution thereof, nor with
any present intention of distributing such Series B Preferred Stock or Series C
Preferred Stock (or the shares of the Voting Common Stock acquired upon
conversion of the Series B Preferred Stock, the Nonvoting Common Stock acquired
upon conversion of the Series C Preferred Stock or the Voting Common Stock
acquired upon conversion of the Nonvoting Common Stock). No other Person has any
right with respect to or interest in the Series B Preferred Stock or the Series
C Preferred Stock to be purchased by Warburg, nor has Warburg agreed to give any
Person any such interest or right in the future.
4.3 Offering Exemption.
Warburg understands that the shares of the Series B Preferred Stock
and the Series C Preferred Stock being purchased hereunder have not been
registered under the Act, nor qualified under any state securities laws, and
that the Series B Preferred Stock and the Series C Preferred Stock are being
offered and sold pursuant to an exemption from such registration and
qualification based in part upon the representations of Warburg contained
herein.
4.4 Knowledge and Experience; Ability to Bear Economic Risks.
Warburg has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of the investment
contemplated by this Agreement and Warburg is able to bear the economic risk of
its investment in the Company (including a complete loss of its investment).
4.5 Limitations on Disposition.
Warburg recognizes that no public market exists for the Series B
Preferred Stock and the Series C Preferred Stock to be sold hereunder, and no
representation has been made to Warburg that any such public market will exist
in the future. Warburg understands that it must bear the economic risk of this
investment indefinitely unless the Series B Preferred Stock and the Series C
Preferred Stock (or the Voting Common Stock and the Nonvoting Common Stock
issuable upon conversion thereof) are registered pursuant to the Act or an
exemption from such registration is available, and unless the disposition of the
Series B Preferred Stock and the Series C Preferred Stock (or the Voting Common
Stock and the Nonvoting Common Stock issuable upon conversion thereof) are
qualified under applicable state securities laws or an exemption from such
qualification is available, and that, except as provided in this Agreement, the
Company has no obligation or present intention of so registering the Series B
Preferred Stock or the Series C Preferred Stock (or the Voting Common Stock or
the Nonvoting Common Stock issuable upon conversion thereof). Warburg
understands that there is no assurance that any exemption from the Act will be
available, or, if available, that such exemption will allow it to dispose of or
otherwise transfer any or all of the Series B Preferred Stock or Series C
Preferred
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Stock, or the Voting Common Stock issuable on the Series B Preferred Stock,
conversion hereof Nonvoting Common Stock issuable upon conversion of the Series
C Preferred Stock or the Voting Common Stock issuable upon conversion of the
Nonvoting Common Stock, in the amounts or at the times Warburg might desire.
Warburg understands that at the present time Rule 144 promulgated under the Act
by the Securities and Exchange Commission ("Rule 144") is not applicable to
sales of the Series B Preferred Stock the Series C Preferred Stock, the Voting
Common Stock or the Nonvoting Common Stock because they are not registered under
Section 12 of the Securities Exchange Act of 1934 (the "Exchange Act"), and
there is not publicly available the information concerning the Company specified
in Rule 144. Warburg acknowledges that the Company is not presently under any
obligation to register under Section 12 of the Exchange Act or to make publicly
available the information specified in Rule 144 and that except as provided
herein, is not otherwise required to do so.
4.6 Brokers, Finders.
The transactions contemplated hereby were not submitted to Warburg by
any broker or other person entitled to a commission, a finder's fee or like
payment thereon and were not with Warburg's authority submitted to the Company
by any broker or other person, and Warburg's action has not given rise to any
valid claim by any person against Warburg or the Company for a commission,
finder's fee or like payment.
SECTION 5. WARBURG'S CLOSING CONDITIONS
The obligation of Warburg to purchase the Series B Preferred Stock
and the Series C Preferred Stock to be sold hereunder on the Closing Date shall
be subject to the following closing conditions having been fulfilled by the
Company on or prior to the Closing Date:
5.1 Representations and Warranties.
The representations and warranties of the Company contained in this
Agreement shall be true on and as of the Closing Date in all material respects
as though such representations and warranties were made at and as of such date,
except as otherwise affected by the transactions contemplated hereby.
5.2 Compliance with Agreement.
The Company shall have performed and complied in all material
respects with all agreements, covenants and conditions contained in this
Agreement which are required to be performed or complied with by the Company
prior to or on the Closing Date.
5.3 Officer's Certificates.
Warburg shall have received a certificate, dated the Closing Date,
signed by an executive officer of the Company on behalf of the Company,
certifying that with respect to the Company, the conditions specified in the
foregoing Sections 5.1 and 5.2 hereof have been fulfilled.
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5.4 Amended Certificate; Amended and Restated By-Laws;
Shareholder Action.
(a) The Amended Certificate shall have been duly approved and
adopted by the requisite shareholder vote and shall have been filed and become
effective under New York law.
(b) The Amended and Restated By-Laws shall have been duly
approved and adopted by the Board of Directors of the Company and shall have
become effective under New York law.
(c) All other action required to be taken by the Company's
shareholders in connection with the transactions contemplated by this Agreement,
the Shareholders' Agreement and the Securities Purchase Agreements shall have
been duly taken by such holders.
5.5 Shareholders' Agreement.
The Company and Xxxxx Xxxxxxxxxx shall have entered into a
Shareholders' Agreement in the form of Exhibit F annexed hereto (the
"Shareholders' Agreement").
5.6 Purchase of Securities by the Company; Termination of
Preemptive Rights.
(a) The Company and each party to a Securities Purchase
Agreement shall have consummated the transactions contemplated by the Securities
Purchase Agreements in accordance with the terms thereof.
(b) The Company and Rensselear Polytechnic Institute ("RPI")
shall have entered into an agreement which terminates RPI's preemptive rights
with respect to the Company's capital stock (the "RPI Preemptive Rights
Termination Agreement").
5.7 Appointment of President and Chief Operating Officer;
Appointment of Directors.
(a) The Company's Board of Directors shall have appointed
Xxxxxx Xxxxx as the President and Chief Operating Officer of the Company and
entered into an agreement relating to Xx. Xxxxx'x employment, the term of which
shall be satisfactory to Warburg.
(b) All necessary corporate action shall have been taken to
reconstitute the Company's Board of Directors so that it shall be a Board of six
members, with one vacancy and five members being: Xxxxx Xxxxxxxxxx, Xxxxxx
Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx Xxxxxx and Xxxxxx Xxxxx.
5.8 Legal Opinion.
Warburg shall have received an opinion of Xxxxxx, Beach & Xxxxxx,
counsel to the Company, substantially to the effect that:
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(i) The Company was duly organized as a corporation
and is existing in good standing under the laws of the State of New York and has
all requisite power and authority to own its properties and to carry on its
business as now conducted.
(ii) The Company is duly qualified and in good
standing as a foreign corporation in all jurisdictions in which the conduct of
the Company's business or the nature of the property owned or leased by the
Company requires such qualification, except where the failure to so qualify
would not have a material adverse effect on the business or financial position
of the Company.
(iii) All Board of Directors and shareholder action
required to authorize the amendments and restatements included in the Amended
Certificate and the Amended and Restated By-Laws have been duly and validly
taken, the Amended Certificate has been duly filed and the Amended Certificate
and the Amended and Restated By-Laws have become effective under New York law.
(iv) Section 3.3 of the Agreement accurately sets
forth the authorized and issued capital stock of the Company existing as of the
date of this Agreement and after giving effect to the purchases and sales
contemplated herein and by the Securities Purchase Agreements, and all such
outstanding shares of capital stock of the Company as described in Section 3.3
are duly authorized, validly issued, fully paid and nonassessable and free of
preemptive rights.
(v) The Company has duly authorized the issuance
and delivery of the Series B Preferred Stock and the Series C Preferred Stock in
accordance with this Agreement and the Company has duly reserved for issuance
shares of Voting Common Stock issuable upon conversion of the Series B Preferred
Stock, shares of Nonvoting Common Stock issuable upon conversion of the Series C
Preferred Stock and Voting Common Stock issuable upon conversion of the
Nonvoting Stock Common. Upon their issuance in accordance with the terms of the
Series B Preferred Stock, the shares of Voting Common Stock issuable upon
conversion of the Series B Preferred Stock will be duly authorized, validly
issued, fully paid and nonassessable shares of Voting Common Stock of the
Company, and free of preemptive rights; upon their issuance in accordance with
the terms of the Series C Preferred Stock, the Nonvoting Common Stock will be
duly authorized, validly issued, fully paid and nonassessable shares of
Nonvoting Common Stock, and free of preemptive rights; and upon their issuance
in accordance with the terms of the Nonvoting Common Stock, the Voting Common
Stock will be duly authorized, validly issued, fully paid and non assessable
shares of Voting Common Stock, and free of preemptive rights.
(vi) The Company has duly authorized the execution,
delivery and performance of this Agreement, the Securities Purchase Agreements,
the Shareholders' Agreement and the RPI Preemptive Rights Termination Agreement
and each of the transactions and agreements contemplated hereby and thereby, and
no other corporate action is necessary to authorize such execution, delivery or
performance. This Agreement, the Securities Purchase Agreements, the
Shareholders' Agreement and the RPI Preemptive Rights Termination Agreement have
been duly executed and delivered
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on behalf of the Company and constitute the valid and binding obligations of the
Company enforceable against the Company in accordance with their terms, except
as such enforcement may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights, and the effect of general principles of equity whether
applied by a court of law or equity.
(vii) The execution and delivery by the Company of
this Agreement, the Securities Purchase Agreements, the Shareholders' Agreement
and the RPI Preemptive Rights Termination Agreement, the performance by the
Company of its obligations hereunder and thereunder and the consummation by the
Company of the transactions contemplated hereby and thereby do not require the
Company to obtain any consent, approval or action of, or make any filing with or
give any notice to any governmental authority, except such as have been duly
obtained or made, as the case may be, and are in full force and effect.
(viii) The execution and delivery of this Agreement,
the Securities Purchase Agreements, the Shareholders' Agreement and the RPI
Preemptive Rights Termination Agreement and the adoption by the Board of
Directors of the Company of the Amended Certificate and the Amended and Restated
By-Laws do not, and the fulfillment of the terms hereof and thereof by the
Company, and if the Company were now to issue the Voting Common Stock upon
conversion of the Series B Preferred Stock, the Nonvoting Common Stock upon the
conversion of the Series C Preferred Stock or the Voting Common Stock upon
conversion of the Nonvoting Common Stock, such issuances would not, (A) result
in a breach of any of the terms, conditions or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, credit agreement, note or
other evidence of indebtedness, or other material agreement to which the Company
is a party, or (B) violate the Certificate of Incorporation or Amended
Certificate or By-laws or Amended and Restated By-Laws, or any rule or
regulation known to such counsel of any court or Federal, state or other
regulatory board or body or administrative agency having jurisdiction over the
Company or over its properties or businesses.
(ix) To the knowledge of such counsel, there is no
action, suit, investigation or proceeding pending or threatened against the
Company or any of its properties or assets by or before any court, arbitrator or
governmental authority which questions the validity of this Agreement, the
Securities Purchase Agreements, the Shareholders Agreement, the RPI Preemptive
Rights Termination Agreement, the Amended Certificate, the Amended and Restated
By-Laws or any action taken or to be taken pursuant hereto or thereto, and the
Company is not in default with respect to any judgment, order, writ, injunction,
decree or award having applicability to the Company or its business or
properties.
5.9 Xxxxxxxxxx Employment Agreement.
The Company and Xxxxx Xxxxxxxxxx shall enter into an agreement
relating to Skevington's employment, the terms of which shall be satisfactory to
Warburg and Xxxxxxxxxx.
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5.10 Approval of Proceedings.
All proceedings to be taken in connection with the transactions
contemplated by this Agreement, and all documents incident thereto, shall be
satisfactory in form and substance to Warburg and its special counsel, Xxxxxxx
Xxxx & Xxxxxxxxx; and Warburg shall have received copies of all documents or
other evidence which it and Xxxxxxx Xxxx & Xxxxxxxxx may request in connection
with such transactions and of all records of corporate proceedings in connection
therewith in form and substance satisfactory to Warburg and Xxxxxxx Xxxx &
Xxxxxxxxx.
5.11 Injunction.
There shall be no effective injunction, writ, preliminary restraining
order or any order of any nature issued by a court of competent jurisdiction
directing that the transactions provided for herein or any of them not be
consummated as herein provided.
5.12 Adverse Development.
Except as set forth in this Agreement and the schedules hereto, there
shall have been no developments in the business of the Company since March 31,
1994 which in the opinion of Warburg would have a materially adverse affect upon
the value of such business or on the financial condition, goodwill or prospects
of the Company.
SECTION 6. COMPANY'S CLOSING CONDITIONS
The obligation of the Company to sell the Series B Preferred Stock to
be sold hereunder on the Closing Date shall be subject to the following closing
conditions having been fulfilled by Warburg on or prior to the Closing Date:
6.1 Representations and Warranties.
The representations and warranties of Warburg contained in this
Agreement shall be true on and as of the Closing Date in all material respects
as though such representations and warranties were made at and as of such date,
except as otherwise affected by the transactions contemplated hereby.
6.2 Compliance with Agreement.
Warburg shall have performed and complied in all material respects
with all agreements, covenants and conditions contained in this Agreement which
are required to be performed or complied with by Warburg prior to or on the
Closing Date.
6.3 Officer's Certificates.
The Company shall have received a certificate, dated the Closing
Date, signed by a duly authorized representative of Warburg, certifying that
with respect to Warburg, the conditions specified in the foregoing Sections 6.1
and 6.2 hereof have been fulfilled.
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6.4 Approval of Proceedings.
All proceedings to be taken in connection with the transactions
contemplated by this Agreement, and all documents incident thereto, shall be
satisfactory in form and substance to the Company and its counsel, Xxxxxx, Beach
& Xxxxxx; and the Company shall have received copies of all documents or other
evidence which the Company and its counsel may reasonably request in connection
with such transactions and of all records of corporate proceedings in connection
therewith in form and substance satisfactory to the Company and its counsel.
6.5 Injunction.
There shall be no effective injunction, writ, preliminary restraining
order or any order of any nature issued by a court of competent jurisdiction
directing that the transactions provided for herein or any of them not be
consummated as herein provided.
SECTION 7. REGISTRATION RIGHTS
7.1 Definitions.
As used in this Section 7:
(a) the terms "register," "registered" and "registration"
refer to a registration effected by preparing and filing a registration
statement in compliance with the Act (and any post-effective amendments filed or
required to be filed) and the declaration or ordering of effectiveness of such
registration statement;
(b) the term "Registrable Securities" means (A) shares of
Voting Common Stock issuable upon conversion of Series B Preferred Stock, (B)
shares of Voting Common Stock issuable upon conversion of Nonvoting Common Stock
issuable upon conversion of Series C Preferred Stock, (C) shares of Voting
Common Stock held by Xxxxxxxxxx on the date hereof, (D) any shares of Voting
Common Stock which the parties hereto may hereafter acquire and (E) any capital
stock of the Company issued as a dividend or other distribution with respect to,
or in exchange for or in replacement of, the shares of Voting Common Stock
referred to in clauses (A)-(D) above;
(c) the term "Holder" shall mean any holder of Registrable
Securities;
(d) the term "Initiating Holder" shall mean Warburg (and its
successors and assigns) so long as such party holds (directly or indirectly) at
least 20% of the Voting Common Stock on a fully diluted basis;
(e) "Commission" shall mean the Securities and Exchange
Commission or any other Federal agency at the time administering the Act;
(f) "Registration Expenses" shall mean all expenses incurred
by the Company in compliance with Sections 7.2 and 7.3 hereof, including,
without limitation, all registration and filing fees, printing expenses, fees
and disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such
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registration (but excluding the compensation of regular employees of the
Company, which shall be paid in any event by the Company); and
(g) "Selling Expenses" shall mean all underwriting discounts
and selling commissions applicable to the sale of Registrable Securities and all
fees and disbursements of counsel for each of the Holders.
7.2 Requested Registration.
(a) Request for Registration. If the Company shall receive
from an Initiating Holder, at any time while this Agreement remains in effect, a
written request that the Company effect a registration under the Act of all or
part of such Initiating Holder's Registrable Securities, the Company shall:
(i) promptly give written notice of the proposed
registration, qualification or compliance to all other Holders of
Registrable Securities; and
(ii) as soon as practicable, use its diligent best
efforts to effect such registration under the Act (including, without
limitation, the execution of an undertaking to file post-effective
amendments, appropriate qualification under applicable blue sky or
other state securities laws and appropriate compliance with
applicable regulations issued under the Act) as may be so requested
and as would permit or facilitate the sale and distribution of all or
such portion of such Registrable Securities as are specified in such
request, together with all or such portion of the Registrable
Securities of any Holder or Holders joining in such request as are
specified in a written request received by the Company within ten
business days after written notice from the Company is given under
Section 6.2 (a) (i) above;
provided, however, that the Company shall not be obligated to effect or take any
action to effect, more than two registrations pursuant to this Section 7.2
(unless the Company is eligible to register under the Act on Form S-3, in which
case, the Initiating Holder may make an unlimited number of requests for
registration) and provided, further, that the Company will not be obligated to
effect, or take any action to effect, any registration pursuant to this Section
7.2 in any particular jurisdiction in which the Company would be required to
execute a general consent to service of process in effecting such registration,
qualification or compliance, unless the Company is already subject to such
jurisdiction and except as may be required by the Act or applicable rules or
regulations thereunder.
The registration statement filed pursuant to the request of the Initiating
Holder may, subject to the provisions of Section 7.2(b) below, include other
Securities of the Company which are held by officers or directors of the
Company, or which are held by persons who, by virtue of agreements with the
Company, are entitled to include their Securities in any such registration, but
the Company shall have no absolute right to include any of its Securities in any
such registration.
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(b) Underwriting. If the Initiating Holder intends to
distribute the Registrable Securities covered by its request by means of an
underwriting, it shall so advise the Company as a part of its request made
pursuant to Section 7.2(a).
If officers or directors of the Company holding other Securities of
the Company shall request inclusion in any registration pursuant to Section 7.2,
or if holders of Securities of the Company other than Registrable Securities who
are entitled, by contract with the Company or otherwise, to have Securities
included in such a registration (the "Other Shareholders") request such
inclusion, the Company shall offer to include the Securities of such officers,
directors and Other Shareholders in the underwriting and may condition such
offer on their acceptance of the further applicable provisions of this Section
7. The Company and the Initiating Holder shall (together with all officers,
directors and Other Shareholders proposing to distribute their Securities
through such underwriting) enter into an underwriting agreement in customary
form with the representative of the underwriter or underwriters selected for
such underwriting by the Initiating Holder and reasonably acceptable to the
Company. Notwithstanding any other provision of this Section 7.2, if the
managing underwriter or representative of the managing underwriter advises the
Holders in writing that marketing factors require a limitation on the number of
shares to be underwritten, the Securities of the Company held by officers or
directors (other than Registrable Securities) of the Company and the Securities
held by Other Shareholders shall be excluded from such registration to the
extent so required by such limitation. If, after the exclusion of Securities of
the Company held by officers or directors and Other Shareholders, further
reductions are still required, the number of shares included in the registration
by each Holder shall be reduced on a pro rata basis, by such minimum number of
shares as is necessary to comply with such request. No Registrable Securities or
any other Securities excluded from the underwriting by reason of the
underwriter's marketing limitation shall be included in such registration. If
any officer, director or Other Shareholder who has requested inclusion in such
registration as provided above disapproves of the terms of the underwriting,
such Person may elect to withdraw therefrom by written notice to the Company,
the underwriter and the Initiating Holder. The Securities so withdrawn shall
also be withdrawn from registration. If the underwriter has not limited the
number of Registrable Securities or other Securities to be underwritten, the
Company may include its Securities for its own account in such registration if
the underwriter so agrees and if the number of Registrable Securities and other
Securities which would otherwise have been included in such registration and
underwriting will not thereby be limited.
7.3 Company Registration.
(a) If the Company shall determine to register any of its
Securities either for its own account or for the account of a security holder or
Holders exercising their respective demand registration rights, other than a
registration relating solely to employee benefit plans, or a registration
relating solely to a transaction of the type described in Rule 145 under the Act
or any successor to Rule 145, or a registration on any registration form which
does not permit secondary sales or does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of Registrable Securities, the Company will:
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(i) promptly give to each of the Holders a written
notice thereof (which shall include a list of the jurisdictions in
which the Company intends to attempt to qualify such Securities under
the applicable blue sky or other state securities laws); and
include in such registration (and any related qualification Under blue sky laws
or other compliance), and in any underwriting involved therein, all the
Registrable Securities specified in a written request or requests, made by the
Holders within 10 days after receipt of the written notice from the Company
described in clause (i) above, except as the number of such Registrable
Securities may be limited by Section 7.3(b) below. Such written request may
specify all or a part of the Holders' Registrable Securities.
(b) Underwriting. If the registration of which the Company
gives notice is for a registered public offering involving an underwriting, the
Company shall so advise each of the Holders as a part of the written notice
given pursuant to Section 7.3(a) (i). In such event, the right of each of the
Holders to registration pursuant to this Section 7.3 shall be conditioned upon
such Holders' participation in such underwriting and the inclusion of such
Holders' Registrable Securities in the underwriting to the extent provided
herein. The Holders shall (together with the Company and the Other Shareholders
distributing their Securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for underwriting by the Company. Notwithstanding any other provision of
this Section 7.3, if the underwriter or underwriters determine that marketing
factors require a limitation on the number of shares to be underwritten, and (x)
if such registration is the first registered offering of the Company's
Securities to the public, the underwriter may (subject to the allocation
priority set forth below) exclude from such registration and underwriting some
or all of the Registrable Securities which would otherwise be underwritten
pursuant hereto, and (y) if such registration is other than the first registered
offering of the Company's Securities to the public, the underwriter may (subject
to the allocation priority set forth below) limit the number of Registrable
Securities to be included in the registration and underwriting to not less than
twenty five percent (25%) of the Securities included therein (based on aggregate
market values). The Company shall so advise all Holders of Securities requesting
registration, and the number of Securities that are entitled to be included in
the registration and underwriting shall be allocated in the following manner:
the Securities of the Company held by officers, directors and Other Shareholders
of the Company (other than Registrable Securities and other than Securities held
by holders who by contractual right demanded such registration ("Demanding
Holders")) shall be excluded from such registration and underwriting to the
extent required by such limitation, and, if a limitation on the number of shares
is still required, the number of shares that may be included in the registration
and underwriting by each of the Holders and Demanding Holders shall be reduced,
on a pro rata basis, by such minimum number of shares as is necessary to comply
with such limitation. If any of the Holders or any officer, director or Other
Shareholder disapproves of the terms of any such underwriting, he may elect to
withdraw therefrom by written notice to the Company and the underwriter. Any
Registrable Securities or other Securities excluded or withdrawn from such
underwriting shall be withdrawn from such registration.
(c) Number. Each of the Holders shall be entitled, pursuant to
this Section 7.3, to have his or its Registrable Securities included in an
unlimited number of registrations which have been declared or ordered effective.
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7.4 Expenses of Registration.
All Registration Expenses incurred in connection with any
registration, qualification or compliance pursuant to this Section 7 shall be
borne by the Company, and all Selling Expenses shall be borne by the holders of
the Securities so registered pro rata on the basis of the number of their shares
so registered; provided, however, that the Company shall not be required to pay
any Registration Expenses if, as a result of the withdrawal of a request for
registration by any of the Holders of Securities, as applicable, the
registration statement does not become effective, in which case each of the
Holders and Other Shareholders requesting registration shall bear such
Registration Expenses pro rata on the basis of the number of their shares so
included in the registration request, and provided, further, that such
registration shall not be counted as a registration for purposes of Section
7.2(a) hereof.
7.5 Registration Procedures.
In the case of each registration effected by the Company pursuant to
Section 7, the Company will keep the Holders, as applicable, advised in writing
as to the initiation of each registration and as to the completion thereof. At
its expense, the Company will:
(a) Keep such registration effective for a period of 120 days
or until the Holders, as applicable, have completed the distribution described
in the registration statement relating thereto, whichever first occurs;
provided, however, that (i) such 120-day period shall be extended for a period
of time equal to the period during which the Holders, as applicable, refrain
from selling any Securities included in such registration in accordance with the
provisions of Section 7.9 hereof; and (ii) in the case of any registration of
Registrable Securities on Form S-3 which are intended to be offered on a
continuous or delayed basis, such 120-day period shall be extended until all
such Registrable Securities are sold, provided that Rule 415, or any successor
rule under the Act, permits an offering on a continuous or delayed basis, and
provided further that applicable rules under the Act governing the obligation to
file a post-effective amendment permit, in lieu of filing a post-effective
amendment which (y) includes any prospectus required by Section 10(a) (3) of the
Act or (z) reflects facts or events representing a material or fundamental
change in the information set forth in the registration statement, the
incorporation by reference of information required to be included in (y) and (z)
above to be contained in periodic reports filed pursuant to Section 13 or 15(d)
of the Exchange Act in the registration statement; and
(b) Furnish such number of prospectuses and other documents
incident thereto as each of the Holders, as applicable, from time to time may
reasonably request.
7.6 Indemnification.
(a) The Company will indemnify each of the Holders, each of
the Holders' officers, directors and partners, and each person controlling each
of the Holders, as applicable, with respect to each registration which has been
effected pursuant to this Section 7, and each underwriter, if any, and each
Person who controls any underwriter, against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any prospectus, offering
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circular or other document (including any related registration statement,
notification or the like) incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of the Act or any rule
or regulation thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such registration,
qualification or compliance, and will reimburse each of the Holders, each of the
Holders' officers, directors and partners, and each Person controlling each of
the Holders, each such underwriter and each Person who controls any such
underwriter, for any legal and any other expenses reasonably incurred in
connection with investigating and defending any such claim, loss, damage,
liability or action, provided that the Company will not be liable in any such
case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission based upon written
information furnished to the Company by any of the Holders or underwriter or
Person controlling such Holder or underwriter and stated to be specifically for
use therein.
(b) Each of the Holders will, if Registrable Securities held
by it are included in the Securities as to which such registration,
qualification or compliance is being effected, severally indemnify the Company,
each of the Company's directors and officers and each underwriter, if any, of
the Company's Securities covered by such a registration statement, each Person
who controls the Company or such underwriter within the meaning of the Act and
the rules and regulations thereunder, against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular or other document
made by such Holder, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading by such Holder, and will reimburse the Company,
directors, officers, partners, Persons, underwriters or control persons for any
legal or any other expenses reasonably incurred in connection with investigating
or defending any such claim, loss, damage, liability or action, in each case to
the extent, but only to the extent, that such untrue statement (or alleged
untrue statement) or omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished to the Company by such Holder
and stated to be specifically for use therein; provided, however, that unless
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is willfully made, the obligations of each of the Holders hereunder
shall be limited to an amount equal to the net proceeds to such Holder of
Securities sold as contemplated herein.
(c) Each party entitled to indemnification under this Section
7.6 (the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld) and the Indemnified Party may participate in such
defense at such party's expense (unless (i) the employment of counsel by such
Indemnified Party has been authorized by the Indemnifying Party, (ii) the
Indemnified Party shall have reasonably concluded that there may be a conflict
of interest between the Indemnifying Party and the Indemnified Party in the
defense of
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such action, in each of which cases the fees and expenses of counsel shall be at
the expense of the Indemnifying Party), and provided further that the failure of
any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 7. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the
consent of each Indemnified Party, consent to entry of any judgment or enter
into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such claim or litigation. Each Indemnified Party
shall furnish such information regarding itself or the claim in question as an
Indemnifying Party may reasonably request in writing and as shall be reasonably
required in connection with the defense of such claim and litigation resulting
therefrom.
(d) If the indemnification provided for in this Section 7.6 is
held by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred to
therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified
Party thereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other in
connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in a negotiated
underwriting agreement entered into in connection with the underwritten public
offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall be controlling.
7.7 Information by the Holders.
Each of the Holders shall furnish to the Company such information
regarding such Holder and the distribution proposed by such Holder as the
Company may reasonably request in writing and as shall be reasonably required in
connection with any registration, qualification or compliance referred to in
this Section 7. The Company shall request the same information from the Other
Shareholders holding Securities requested to be included in a registration.
7.8 Rule 144 Reporting.
With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of restricted Securities
to the public without registration, the Company agrees to:
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(a) Make and keep public information available as those terms
are understood and defined in Rule 144 under the Act, at all times following the
effective date of the first registration under the Act filed by the Company for
an offering of its Securities to the general public;
(b) Use its best efforts to file with the Commission in a
timely manner all reports and other documents required of the Company under the
Act and the Exchange Act at any time after it has become subject to such
reporting requirements; and
(c) So long as Warburg owns any Registrable Securities,
furnish to Warburg upon request, a written statement by the Company as to its
compliance with the public information requirements of Rule 144 (at any time
from and after ninety (90) days following the effective date of the first
registration statement filed by the Company for an offering of its Securities to
the general public), and of the Act and the Exchange Act (at any time after it
has become subject to such reporting requirements), a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
so filed as Warburg may reasonably request in availing itself of any rule or
regulation of the Commission allowing Warburg to sell any such Securities
without registration.
7.9 "Market Stand-off" Agreement.
Each of the Holders shall agree, if requested by the Company and the
underwriter or underwriters, not to sell or otherwise transfer or dispose of any
Securities of the Company held by such Holder during the one hundred eighty
(180) day period following the effective date of a registration statement of the
Company filed under the Act, provided that:
(a) such agreement shall only be required in connection with
the first such registration statement of the Company which includes Securities
to be sold on the Company's behalf to the public in an underwritten offering;
and
(b) all Other Shareholders and officers and directors of the
Company enter into similar agreements.
The agreement shall be in writing in a form satisfactory to the
Company and such underwriter. The Company may impose stop-transfer instructions
with respect to the Securities of the Company subject to the foregoing
restriction until the end of said one hundred eighty (180) day period.
7.10 Partnership Distribution.
In the event that Warburg advises the Company that it desires to
exercise one of the registration rights granted to it under Sections 7.2 or 7.3
of this Agreement as a Holder of Registrable Securities in order to effect a
distribution of some or all of such Registrable Securities to its partners,
then, notwithstanding any provision of this Agreement conditioning the inclusion
of Registrable Securities in a registration statement upon the Holder's
participation in an underwriting, Warburg may refrain from including such shares
in an underwriting and nevertheless cause such shares to be included in the
applicable registration statement, provided only that (a) such registration is
not the initial registration hereunder of the Company's
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Securities, and (b) such Holder agrees not to effect such distribution until the
expiration of a standstill period requested by the managing underwriter of the
underwriting of the other Securities included in such registration, provided
that such period shall not exceed 90 days after the effective date of such
registration.
7.11 Limitation of Registration Rights.
Notwithstanding anything to the contrary contained in this Agreement,
the Company shall not be required to include in any registration statement filed
pursuant to Section 7.2 or 7.3 of this Agreement Registrable Securities held by
a Holder (i) if the Company shall have received opinions of counsel reasonably
satisfactory to such Holder and the Company to the effect that the proposed
disposition of such Registrable Securities by such Holder may be effected
without registration under the Act or (ii) to the extent such Holder's
Registrable Securities can then be sold during a single three month period
pursuant to Rule 144 under the Act.
7.12 Assignability of Registration Rights.
The registration rights granted pursuant to this Section 7 shall be
assignable at the option of each of the Holders, in whole or in part, to any
transferee of Registrable Securities (i) so long as such transferee owns at
least 1% of the Voting Common Stock (computed on a fully diluted basis) of the
Company or (ii) the transferee is an Affiliate of Warburg or Xxxxxxxxxx;
provided, that the Company is given written notice by such Holder at the time or
within a reasonable period of time after said transfer, stating the name and
address of such transferee or assignee and identifying the Securities with
respect to which such registration rights are assigned.
SECTION 8. COVENANTS
8.1 Financial and Business Information.
From and after the date hereof, the Company shall deliver to Warburg
so long as it holds at least 10% of the Voting Common Stock on a fully diluted
basis:
(a) Monthly and Quarterly Statements - As soon as practicable,
and in any event within 30 days after the close of each month of each fiscal
year of the Company in the case of monthly statements and 45 days after the
close of each of the first three fiscal quarters of each fiscal year of the
Company in the case of quarterly statements, a consolidated balance sheet,
statement of income and statement of cash flows of the Company and its
subsidiaries as at the close of such month or quarter and covering operations
for such month or quarter, as the case may be, and the portion of the Company's
fiscal year ending on the last day of such month or quarter, all in reasonable
detail and prepared in accordance with generally accepted accounting principles,
consistently applied, subject to audit and year-end adjustments, setting forth
in each case in comparative form the figures for the comparable period of the
previous fiscal year and accompanied by a narrative description of the Company's
business and results of operations for such month or quarter. The Company shall
also provide comparisons of each pertinent item to the budget referred to in
subsection (c) below.
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(b) Annual Statements - As soon as practicable after the end
of each fiscal year of the Company, and in any event within 60 days thereafter,
duplicate copies of:
(1) consolidated and consolidating balance sheets of the
Company and its subsidiaries at the end of such year; and
(2) consolidated and consolidating statements of income,
stockholders' equity and cash flows of the Company and its subsidiaries for
such year, setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail and accompanied by an
opinion thereon of a firm of independent certified public accountants of
recognized national standing selected by the Company and reasonably
acceptable to Warburg, which opinion shall state that such financial
statements fairly present the financial position of the Company and its
subsidiaries on a consolidated basis, as applicable, and have been prepared
in accordance with generally accepted accounting principles consistently
applied (except for changes in application in which such accountants
concur) and that the examination of such accountants in connection with
such financial statements has been made in accordance with generally
accepted auditing standards, and accordingly included such tests of the
accounting records and such other auditing procedures as were considered
necessary in the circumstances, and the Company shall also provide
comparisons of each pertinent item to the budget referred to in subsection
(c) below.
(c) Business Plan: Projections - No later than 30 days prior
to the commencement of each fiscal year of the Company, an annual business plan
of the Company and projections of operating results, prepared on a monthly
basis, and a three year business plan of the Company and projections of
operating results. Within 45 days of the close of each semi-annual fiscal period
of the Company, the Company shall provide Warburg with an update of such monthly
projections. Such business plans, projections and updates shall contain such
substance and detail and shall be in such form as will be reasonably acceptable
to Warburg.
(d) Audit Reports - Promptly upon receipt thereof, one copy of
each other financial report and internal control letter submitted to the Company
by independent accountants in connection with any annual, interim or special
audit made by them of the books of the Company and its subsidiaries, as
applicable.
(e) Other Reports - Promptly upon their becoming available,
one copy of each financial statement, report, notice or proxy statement sent by
the Company to stockholders generally, of each financial statement, report,
notice or proxy statement sent by the Company or any of its subsidiaries to the
SEC or any successor agency, if applicable, of each regular or periodic report
and any registration statement, prospectus or written communication (other than
transmittal letters) in respect thereof filed by the Company or any of its
subsidiaries with, or received by such Person in connection therewith from, any
securities exchange or the SEC or any successor agency, of any press release
issued by the Company or any of its subsidiaries, and of any material of any
nature whatsoever prepared by the SEC or any successor agency thereto or any
state blue sky or securities law commission which relates to or affects in any
way the Company or any of its subsidiaries;
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(f) ERISA - Promptly upon becoming aware of the occurrence of
any (i) "reportable event," as such term is defined in Section 4043 of ERISA and
the rules and regulations thereunder, or (ii) "prohibited transaction," as such
term is defined in Section 4975 of the Code, in connection with any employee
benefit pension plan, as defined in Section 3(2) of ERISA, or any trust created
thereunder, a written notice specifying the nature thereof, what action the
Company is taking or proposes to take with respect thereto, and, when known, any
action taken by the Internal Revenue Service with respect thereto;
(g) Progress Report - Prior to each regularly scheduled
meeting of the Board of Directors of the Company, a narrative report describing
the Company's activities since the date of the last such report, including a
description of business development, operating results and marketing efforts;
and
(h) Requested Information - With reasonable promptness, such
other data and information as from time to time may be reasonably requested.
8.2 Inspection.
As long as Warburg holds at least 10% of the Voting Common Stock or
holds Securities convertible into a number of shares of Voting Common Stock that
if converted would equal at least 10% of the Voting Common Stock outstanding
upon conversion, the Company shall permit Warburg, its nominees, assignees and
representatives to visit and inspect any of the properties of the Company, to
examine all its books of account, records, reports and other papers not
contractually required of the Company to be confidential or secret, to make
copies and extracts therefrom, and to discuss its affairs, finances and accounts
with its officers, directors, key employees and independent public accountants
or any of them (and by this provision the Company authorizes said accountants to
discuss with Warburg, its nominees, assignees and representatives the finances
and affairs of the Company and its subsidiaries), all at such reasonable times
and as often as may be reasonably requested.
8.3 Confidentiality.
(a) As to so much of the information and other material
furnished under or in connection with this Agreement (whether furnished before,
on or after the date hereof, including without limitation, information furnished
pursuant to Sections 8.1 and 8.2 hereof) as constitutes or contains confidential
business, financial or other information of the Company or its subsidiaries,
Warburg covenants for itself, and, as applicable, for its directors, officers
and partners, that, Warburg will use due care to prevent its officers,
directors, partners, employees, counsel, accountants and other representatives
from disclosing such information to persons other than their respective
authorized employees, counsel, accountants, shareholders, partners, limited
partners and other authorized representatives; provided, however, that Warburg
may disclose or deliver any information or other material disclosed to or
received by it should it be advised by such counsel that such disclosure or
delivery is required by law, regulation or judicial or administrative order.
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For purposes of this Section 8.3(a), "due care" means at least the
same level of care that Warburg would use to protect the confidentiality of its
own sensitive or proprietary information, and this obligation shall survive
termination of this Agreement.
(b) From and after the consummation of an initial public
offering of Securities, to the extent that any of the information furnished
pursuant to Sections 8.1 or 8.2 hereof would constitute material, nonpublic
information for purposes of the Exchange Act, Warburg covenants for itself that
Warburg will not engage in any purchase or sale of Company Securities while in
possession of such information and prior to the time that such information is
made generally known to the public and that Warburg shall use due care to
prevent its officers, directors, partners, employees, counsel and other
representatives, who have been given access to such material, nonpublic
information, from engaging in any such purchase or sale during such period.
8.4 Resale of Securities.
(a) Warburg covenants that it will not sell or otherwise
transfer the Series B Preferred Stock or the Series C Preferred Stock purchased
hereunder (or any shares of Voting Common Stock acquired upon the conversion of
shares of Series B Preferred Stock, any shares of Nonvoting Common Stock
acquired upon the Conversion of shares of Series C Preferred Stock or any shares
of Voting Common Stock acquired upon conversion of shares of Nonvoting Common
Stock) except pursuant to an effective registration under the Act or in a
transaction which, in the opinion of counsel reasonably satisfactory to the
Company, qualifies as an exempt transaction under the Act and the rules and
regulations promulgated thereunder and any applicable state securities laws.
(b) The certificates evidencing the shares of Series B
Preferred Stock and Series C Preferred Stock purchased hereunder and the shares
of Voting Common Stock and Nonvoting Common Stock acquired upon conversion
thereof shall bear the following legend:
"The securities evidenced hereby have not been registered
under the Securities Act of 1933, as amended (the "Act"), and may not
be transferred except pursuant to an effective registration under the
Act or in a transaction which, in the opinion of counsel reasonably
satisfactory to the Company, qualifies as an exempt transaction under
the Act and the rules and regulations promulgated thereunder."
8.5 Relocation of Corporate Headquarters.
Within 90 days after the Closing Date, the Company shall provide to
Warburg a written commitment to relocate and a comprehensive relocation plan
relating to its relocation from Xxxxxxx Park, New York to Atlanta, Georgia or
Boston, Massachusetts.
8.6 Covenants Pending Closing.
Pending the Closing of the transactions contemplated hereby, the Company will
not, without Warburg's prior written consent, take any action which would result
in any of the representations or warranties contained in this Agreement not
being true at and as of the time immediately after such action, or in any of the
covenants contained in this Agreement becoming incapable of performance. The
Company will promptly advise Warburg of any action or event of which it becomes
aware which has the effect of making incorrect any of such representations or
warranties or which has the effect of rendering any of such covenants incapable
of
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performance. Pending the Closing, the Company shall not issue shares of capital
stock of the Company except pursuant to the terms of this Agreement.
8.7 Keeping of Books.
The Company shall keep proper books of record and account, in which
full and correct entries shall be made of all financial transactions and the
assets and business of the Company in accordance with GAAP consistently applied.
8.8 Further Assurances.
Each of the parties shall execute such documents and other papers and
take such further actions as may be reasonably required or desirable to carry
out the provisions hereof and the transactions contemplated hereby. Each such
party shall use its best efforts to fulfill or obtain the fulfillment of the
conditions to the Closing as promptly as practicable.
8.9 Insurance.
The Company shall maintain with financially sound and reputable
insurance companies insurance on the business and properties of the Company
(including, without limitation, product liability coverage, and directors and
officers liability insurance) in at least such amounts and against at least such
risks as are usually insured against by companies engaged in similar businesses
and as shall be reasonably acceptable to Warburg.
8.10 Post-Closing Matters.
(a) The Company shall file an Amended and Restated Certificate
of Incorporation that deletes the Series A Preferred Stock within 7 Business
Days after the Closing.
(b) The Company shall enter into a ,,non-compete" agreement in
the form of Exhibit G annexed hereto with Xxxxxxx Xxxxx within 10 Business Days
after the Closing.
(c) The Company and Xxxxx Xxxxxxx shall enter into the Company
standard form Proprietary Information Agreement for Consultants within 30
Business Days after Closing.
SECTION 9. INTERPRETATION OF THIS AGREEMENT
9.1 Terms Defined.
As used in this Agreement, the following terms have the respective
meanings set forth below:
"Act" shall mean the Securities Act of 1933, as amended.
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"Affiliate" shall mean with respect to any Person, any other Person
which directly or indirectly, by itself or through one or more intermediaries,
controls, or is controlled by, or is under direct or indirect common control
with, such Person. The term "control" means the possession, direct or indirect,
of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or
otherwise.
"Aspen Securities Purchase Agreement" shall mean the Securities
Purchase Agreement dated May 6, 1994 between the Company and Aspen Venture
Partners, L.P.
"Business Day" shall mean any day which is not a Saturday, Sunday or
day on which banks are authorized by law to be closed in the State of New York.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
the regulations promulgated thereunder.
"Exchange Act" shall mean the Securities Exchange Act of 1934.
"Person" shall mean an individual, partnership, joint-stock company,
corporation, trust or unincorporated organization, and a government or agency or
political subdivision thereof.
"Security, Securities" shall have the meanings ascribed thereto in
Section 2(1) of the Act.
"Securities Purchase Agreements" shall mean the Securities Purchase
Agreements between the Company and each of Aspen Venture Partners L.P., Xxxxxx,
Xxxxxxx and Fulup dated May 6, 1994 and between the Company and Xxxxxxxxx dated
May 10, 1994.
9.2 Accounting Principles.
Where the character or amount of any asset or amount of any asset or
liability or item of income or expense is required to be determined or any
consolidation or other accounting computation is required to be made for the
purposes of this Agreement, this shall be done in accordance with generally
accepted accounting principles at the time in effect, to the extent applicable,
except where such principles are inconsistent with the requirements of this
Agreement.
9.3 Directly or Indirectly.
Where any provision in this Agreement refers to action to be taken
by, or prohibited to be taken by, any Person, such provision shall be applicable
whether such action is taken directly or indirectly by such Person.
9.4 Governing Law.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
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9.5 Section Headings.
The headings of the sections and subsections of this Agreement are
for convenience only and shall not be deemed to constitute a part of this
Agreement.
SECTION 10. MISCELLANEOUS
10.1 Notices.
All notices, instructions or other communications required or
permitted to be given hereunder or necessary in connection herewith shall be in
writing and shall be deemed to have been duly delivered upon the delivery
thereof, if delivered personally, upon the transmission thereof, if sent by
facsimile transmission, on the second business day after delivery to an air
courier company for express delivery, or on the seventh business day after
mailing, if mailed, postage prepaid, registered or certified mail, as follows:
(i) if to Warburg, at the address shown below,
marked for attention as there indicated, or at such other address as
Warburg may have furnished to the Company and Xxxxxxxxxx in writing:
Warburg, Xxxxxx Investors, L.P.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxx
(ii) if to the Company, at the address shown below,
or at such other address as the Company may have furnished to Warburg
and Xxxxxxxxxx in writing:
Factory Automation & Computer
Technologies, Inc.
0 Xxxxxx Xxxx Xxxxx
Xxxxxxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Chief Executive Officer
(iii) if to Xxxxxxxxxx, at the address shown below,
or at such other address as Xxxxxxxxxx may have furnished to Warburg
and the Company in writing:
Xxxxx Xxxxxxxxxx
c/o Factory Automation & Computer
Technologies, Inc.
0 Xxxxxx Xxxx Xxxxx
Xxxxxxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
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10.2 Expenses and Taxes.
(a) The Company shall be responsible for the fees and
disbursements of its legal counsel, Xxxxxx, Beach & Xxxxxx, and the fees and
disbursements of Warburg's legal counsel, Willkie Fart & Xxxxxxxxx, in each
case, incurred in connection with the negotiation, execution and delivery of
this Agreement, the Securities Purchase Agreements, the Restated Certificate,
the Shareholders' Agreement, the RPI Preemptive Rights Termination Agreement and
the employment agreements with Xxxxxxxxxx and Xxxxxx Xxxxx and the closing of
the transactions contemplated thereby.
(b) The Company will pay, and save Warburg harmless from any
and all liabilities (including interest and penalties) with respect to, or
resulting from any delay or failure in paying, stamp and other taxes (other than
income taxes), if any, which may be payable or determined to be payable on the
execution and delivery of this Agreement or acquisition of Warburg's capital
stock pursuant to this Agreement.
10.3 Reproduction of Documents.
This Agreement and all documents relating hereto, including, without
limitation, (a) consents, waivers and modifications which may hereafter be
executed, (b) documents received by Warburg pursuant hereto (except for
certificates evidencing the Voting Common Stock, the Nonvoting Common Stock, the
Series B Preferred Stock and the Series C Preferred Stock) and (c) financial
statements, certificates and other information previously or hereafter furnished
to Warburg, may be reproduced by Warburg by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process and
Warburg may destroy any original document so reproduced. The parties hereto
agree and stipulate that any such reproduction shall be admissible in evidence
as the original itself in any judicial or administrative proceeding (whether or
not the original is in existence and whether or not such reproduction was made
by Warburg in the regular course of business) and that any enlargement,
facsimile or further reproduction of such reproduction shall likewise be
admissible in evidence.
10.4 Successors and Assigns.
This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties hereto. Except to the extent
otherwise provided for herein, neither this Agreement nor the rights of the
parties hereunder may be assigned without the written consent of the
nonassigning party.
10.5 Entire Agreement; Amendment and Waiver.
This Agreement constitutes the entire understanding of the parties
hereto and supersedes all prior term sheets, letters of intent, agreements or
understandings among such parties relating to the subject matter hereof. This
Agreement may be amended, and the observance of any term of this Agreement may
be waived, with (and only with) the written consent of the Company and Warburg.
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10.6 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 such
counterparts together shall constitute only one instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date above first written.
FACTORY AUTOMATION & COMPUTER
TECHNOLOGIES, INC.
By: /s/ Xxxxx Xxxxxxxxxx
--------------------------------------------------
Name: Xxxxx Xxxxxxxxxx
Title: CEO
WARBURG, XXXXXX INVESTORS, L.P.
By: Warburg, Xxxxxx & Co., its General Partner
By: /s/ Xxxxx Xxxxxxx
--------------------------------------------------
Xxxxx Xxxxxxx
Managing Director
/s/ Xxxxx Xxxxxxxxxx
-----------------------------------------------------
Xxxxx Xxxxxxxxxx
