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EXHIBIT 1.1
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is dated as of
March 29, 2001 by and between General Magic, Inc. a Delaware corporation (the
"Company"), and Xxxx Xxxxxx Capital Partners Ltd. (the "Purchaser").
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Certain Definitions.
(a) "Average Daily Price" shall be the average of the VWAP of the
Company' s Common Stock on the Principal Market during the applicable Settlement
Period.
(b) "Material Adverse Effect" shall mean any adverse effect on the
business, operations, properties, prospects or financial condition of the
Company that is material and adverse to the Company and its subsidiaries and
affiliates, taken as a whole and/or any condition, circumstance, or situation
that would prohibit or otherwise materially interfere with the ability of the
Company to perform any of its material obligations under this Agreement or to
perform any of its material obligations under any other material agreement.
(c) "Pricing Period" shall mean the period beginning on April 12, 2001
and ending on the sixtieth Trading Day thereafter.
(d) "Pricing Supplement" shall mean the supplement to the Registration
Statement which sets forth, with respect to a Settlement, the number of Shares
purchased, the anticipated Settlement Date, and any other information mutually
agreed to be included by the Company and the Purchaser.
(e) "Principal Market" shall mean initially the Nasdaq National Market
and shall include the Nasdaq SmallCap Market, the American Stock Exchange or the
New York Stock Exchange if the Company becomes listed and trades on such market
or exchange after the date hereof.
(f) "Prospectus" shall mean the base prospectus contained in the
Registration Statement and each prospectus supplement (including any Pricing
Supplement) relating to the Common Stock to be purchased pursuant to this
Agreement filed pursuant to Rule 424(b).
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(g) "Purchase Price" shall mean with respect to Shares purchased on
each Settlement Date, ninety-one percent (91%) of the Average Daily Price for
the Settlement Period being settled on such Settlement Date.
(h) "Registration Statement" shall mean the registration statement
under the Securities Act of 1933, as amended (the "Securities Act") filed with
the Securities and Exchange Commission, File No. 333-79857, registering for sale
pursuant to Rule 415 certain securities of the Company, including the filings
with the Commission pursuant to the Securities Exchange Act of 1934 (the
"Exchange Act") incorporated therein, as of each Settlement Date.
(i) "SEC Documents" shall mean the Registration Statement and all
Exchange Act reports incorporated by reference therein.
(j) "Settlement Date" shall mean each date on which the Company
delivers Shares versus payment of the Purchase Price by the Purchaser.
(k) "Settlement Period" shall mean each Trading Day during the Pricing
Period commencing with the first day of the Pricing Period and ending on the
last day of the Pricing Period. No Settlement Period shall overlap another
Settlement Period.
(l) "Shares" shall mean, collectively, the shares of Common Stock of
the Company being subscribed for hereunder.
(m) "Trading Day" shall mean any day on which the Principal Market is
open for business.
(n) "VWAP" shall mean the daily volume weighted average price of the
Company's Common Stock on the Principal Market as reported by Bloomberg
Financial L.P. (based on a trading day from 9:30 am EST to 4:00 pm EST) using
the VAP function.
ARTICLE II
PURCHASE AND SALE OF COMMON STOCK
Section 2.1. Purchase and Sale of Stock. Subject to the terms and
conditions of this Agreement, the Company will issue and sell to the Purchaser
and the Purchaser shall purchase from the Company two million dollars
($2,000,000) of the Company's Common Stock (the "Commitment Amount"), $0.001 par
value per share (the "Common Stock"). The maximum number of Shares which the
Company shall sell to the Purchaser shall be three million three hundred thirty
four thousand one hundred thirty-eight (3,334,138).
Section 2.2. Warrants. Upon execution of this Agreement, the Company
shall deliver to the Purchaser, as a commitment fee for the Purchaser's
agreements herein, a warrant to purchase up to 200,000 shares of the Company's
Common Stock. Such warrant shall have an exercise price of $1.75 per share and
shall have a term of three years. The shares issuable
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upon exercise of such warrant shall have "piggyback" registration rights under
customary terms and conditions, and shall otherwise be in form reasonably
acceptable to the Purchaser.
Section 2.3. Closing and Settlement. The delivery of executed
documents under this Agreement and the closing delivery items of the Company
referred to in Section 5.2 herein shall take place at the offices of Purchaser's
counsel, Xxxxxxx Xxxxxx & Green, P.C., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
on each Settlement Date.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.1. Representation and Warranties of the Company. The Company
hereby makes the following representations and warranties to the Purchaser:
(a) Organization, Good Standing and Power. The Company is a
corporation duly incorporated validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate authority to own,
lease and operate its properties and assets and to carry on its business as now
being conducted. The Company does not have any subsidiaries and does not own
more than fifty percent (50%) of or control any other business entity except as
set forth in the SEC Documents. The Company is duly qualified to do business and
is in good standing as a foreign corporation in every jurisdiction in which the
nature of the business conducted or property owned by it makes such
qualification necessary, other than those in which the failure so to qualify
would not have a Material Adverse Effect on the Company's financial condition.
(b) Authorization, Enforceability. (i) The Company has the requisite
corporate power and corporate authority to enter into and perform its
obligations under this Agreement and to issue the Shares, (ii) the execution,
issuance and delivery of this Agreement by the Company and the consummation by
it of the transactions contemplated hereby, have been duly authorized by all
necessary corporate action and no further consent or authorization of the
Company or its Board of Directors or stockholders is required, and (iii) this
Agreement has been duly executed and delivered by the Company and constitutes
the valid and binding obligation of the Company enforceable against the Company
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditors' rights and remedies or by other
equitable principles of general application. The Company has duly and validly
authorized and reserved for issuance shares of Common Stock sufficient in number
for the issuance of the Shares.
(c) Capitalization. The authorized and outstanding capital stock of
the Company is as set forth on Schedule 3.1(c) hereto. All of the outstanding
shares of the Company's Common Stock have been duly and validly authorized and
are fully paid and non-assessable, except as set forth in the SEC Documents.
Except as set forth in this Agreement and
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as set forth in the SEC Documents, or on Schedule 3.1(c) hereto, no shares of
Common Stock are entitled to preemptive rights or registration rights and there
are no outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company. Furthermore,
except as set forth in this Agreement and as set forth in the SEC Documents or
on Schedule 3.1(c), there are no contracts, commitments, understandings, or
arrangements by which the Company is or may become bound requiring the Company
to issue additional shares of the capital stock of the Company or options,
securities or rights convertible into shares of capital stock of the Company.
Except as set forth in the SEC Documents or on Schedule 3.1(c), the Company is
not a party to any agreement granting registration rights to any person with
respect to any of its equity or debt securities. Except as set forth in the SEC
Documents or on Schedule 3.1(c), the Company is not a party to, and it has no
knowledge of, any agreement restricting the voting or transfer of any shares of
the capital stock of the Company. Except as set forth in the SEC Documents or on
Schedule 3.1(c) hereto, the offer and sale of all capital stock, convertible
securities, rights, warrants, or options of the Company issued prior to the date
hereof complied with all applicable federal and state securities laws, and no
stockholder has a right of rescission or damages with respect thereto which
would have a Material Adverse Effect on the Company's financial condition or
operating results. The Company has made available to the Purchaser true and
correct copies of the Company's articles or certificate of incorporation as in
effect on the date hereof (the "Charter"), and the Company's Bylaws as in effect
on the date hereof (the "Bylaws"). During the last year, the Company has not
received any notice from the Principal Market questioning or threatening the
continued inclusion of the Common Stock on such market.
(d) Issuance of Shares. The Shares to be issued under this Agreement
have been duly authorized by all necessary corporate action and, when paid for
and issued in accordance with the terms hereof, the Shares shall be validly
issued and outstanding, fully paid and non-assessable, and the Purchaser shall
be entitled to all rights accorded to a holder of Common Stock.
(e) No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated herein do not and will not, as of any Settlement Date, (i) violate
any provision of the Company's Charter or Bylaws, (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, mortgage, deed of
trust, indenture, note, bond, license, lease agreement, instrument or obligation
to which the Company is a party, (iii) create or impose a lien, charge or
encumbrance on any property of the Company under any agreement or any commitment
to which the Company is a party or by which the Company is bound or by which any
of its respective properties or assets are bound, or (iv) result in a violation
of any federal, state, local or other foreign statute, rule, regulation, order,
judgment or decree (including any federal or state securities laws and
regulations) applicable to the Company or any of its subsidiaries or by which
any property or asset of the Company or any of its subsidiaries are bound or
affected, except, in all cases, for such conflicts, defaults, termination,
amendments, accelerations, cancellations and violations which would not,
individually or in the aggregate, have a Material Adverse Effect. The business
of the Company
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and its subsidiaries is not being conducted in violation of any laws, ordinances
or regulations of any governmental entity, except for possible violations which
singularly or in the aggregate do not and will not have a Material Adverse
Effect. The Company is not required under any federal, state or local law, rule
or regulation to obtain any consent, authorization or order of, or make any
filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under this Agreement, or
issue and sell the Shares in accordance with the terms hereof (other than any
filings which may be required to be made by the Company with the Securities and
Exchange Commission (the "SEC") or state securities administrators subsequent to
the date hereof); provided that, for purpose of the representation made in this
sentence, the Company is assuming and relying upon the accuracy of the relevant
representations and agreements of the Purchaser herein.
(f) SEC Documents, Financial Statements.
(i) The Company meets the requirements for use of Form S-3 under
the securities Act in connection with the offering pursuant to the Registration
Statement. The Registration Statement has remained in effect since it was
originally declared effective by the SEC on July 15, 1999. The Registration
Statement covers, among other securities, the registration under the Securities
Act of the offering and sale of the Shares to the Purchaser and by the Purchaser
to the public as an underwriter, and the Registration Statement and the sale of
the Shares hereunder meets the requirements set forth in Rules 415(a)(1)(x).
(ii) The Common Stock of the Company is registered pursuant to
Section 12(b) or Section 12(g) of the Exchange Act, and, except as disclosed in
the SEC Documents or on Schedule 3.1(f) hereto, the Company has timely filed all
reports, schedules, forms, statements and other documents required to be filed
by it with the SEC pursuant to the reporting requirements of the Exchange Act,
including material filed pursuant to Section 13(a) or 15(d) of the Exchange Act
at least since December 31, 1998. The Company has not provided to the Purchaser
any information which, according to applicable law, rule or regulation, should
have been disclosed publicly by the Company but which has not been so disclosed,
other than with respect to the transactions contemplated by this Agreement. As
of their respective filing dates, the SEC Documents complied in all material
respects with the requirements of the Exchange Act or the Securities Act, as
applicable, and the rules and regulations of the SEC promulgated thereunder
applicable to such documents, and, as of their respective filing dates, none of
the SEC Documents contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. Except as set forth in the SEC Documents, the financial
statements of the Company included in the SEC Documents comply as to form in all
material respects with applicable accounting requirements and the published
rules and regulations of the SEC or other applicable rules and regulations with
respect thereto. Except as set forth in the SEC Documents, such financial
statements have been prepared by management in accordance with generally
accepted accounting principles ("GAAP") applied on a consistent basis during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto or (ii) in the case of unaudited interim
statements, to the extent they may not include footnotes or may be condensed or
summary statements), and fairly present
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in all material respects the financial position of the Company and its
subsidiaries as of the dates thereof and the results of operations and cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments). KPMG LLP have audited the annual
financial statements and reviewed the quarterly financial statements for all
periods from and after June 30, 2000, and are independent public accountants as
required by Regulation S-X of the Securities Act.
(g) Subsidiaries. The SEC Documents or Schedule 3.1(g) hereto sets
forth each subsidiary of the Company, showing the jurisdiction of its
incorporation or organization and showing the percentage of the Company's
ownership of the outstanding stock or other interests of such subsidiary. For
the purposes of this Agreement, "subsidiary" shall mean any corporation or other
entity of which at least a majority of the securities or other ownership
interests having ordinary voting power (absolutely or contingently) for the
election of directors or other persons performing similar functions are at the
time owned directly or indirectly by the Company and/or any of its other
subsidiaries. All of the outstanding shares of capital stock of each subsidiary
have been duly authorized and validly issued, and are fully paid and
non-assessable. There are no outstanding preemptive, conversion or other rights,
options, warrants or agreements granted or issued by or binding upon any
subsidiary for the purchase or acquisition of any shares of capital stock of any
subsidiary or any other securities convertible into, exchangeable for or
evidencing the rights to subscribe for any shares of such capital stock. Neither
the Company nor any subsidiary is subject to any obligation (contingent or
otherwise) to repurchase or otherwise acquire or retire any shares of the
capital stock of any subsidiary or any convertible securities, rights, warrants
or options of the type described in the preceding sentence. Neither the Company
nor any subsidiary is a party to, nor has any knowledge of, any agreement
restricting the voting or transfer of any shares of the capital stock of any
subsidiary.
(h) No Material Adverse Effect. Since the date of the financial
statements contained in the Company's most recently filed Form 10-Q or Form
10-K, whichever is most current, no Material Adverse Effect has occurred or
exists with respect to the Company, except as disclosed in the SEC Documents or
on Schedule 3.1(h) hereto.
(i) No Undisclosed Liabilities. Except as disclosed in the SEC
Documents or on Schedule 3.1(i) hereto, neither the Company nor any of its
subsidiaries has any liabilities, obligations, claims or losses (whether
liquidated or unliquidated, secured or unsecured, absolute, accrued, contingent
or otherwise) that would be required to be disclosed on a balance sheet of the
Company or any subsidiary (including the notes thereto) in conformity with GAAP
which are not disclosed in the SEC Documents, other than those incurred in the
ordinary course of the Company's or its subsidiaries' respective businesses
since such date and which, individually or in the aggregate, do not or would not
have a Material Adverse Effect on the Company or its subsidiaries.
(j) No Undisclosed Events or Circumstances. Since the date of the
financial statements contained in the Company's most recently filed Form 10-Q or
Form 10-K, whichever is most current, no event or circumstance has occurred or
exists with respect to the Company or its businesses, properties, prospects,
operations or financial condition, that, under
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applicable law, rule or regulation, requires public disclosure or announcement
prior to the date hereof by the Company but which has not been so publicly
announced or disclosed in the SEC Documents.
(k) Indebtedness. The SEC Documents or Schedule 3.1(k) hereto sets
forth as of the date hereof all outstanding secured and unsecured Indebtedness
of the Company or any subsidiary, or for which the Company or any subsidiary has
commitments. For the purposes of this Agreement, "Indebtedness" shall mean (A)
any liabilities for borrowed money or amounts owed in excess of $250,000 (other
than trade accounts payable incurred in the ordinary course of business), (B)
all guaranties, endorsements and contingent obligations in respect of
Indebtedness of others, whether or not the same are or should be reflected in
the Company's balance sheet (or the notes thereto), except guaranties by
endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business; and (C) the present value of
any lease payments in excess of $250,000 due under leases required to be
capitalized in accordance with GAAP. Neither the Company nor any subsidiary is
in default with respect to any Indebtedness.
(l) Title to Assets. Each of the Company and the subsidiaries has good
and marketable title to all of its real and personal property reflected in the
SEC Documents, free of any mortgages, pledges, charges, liens, security
interests or other encumbrances, except for those indicated in the SEC Documents
or on Schedule 3.1(1) hereto or such that do not cause a Material Adverse Effect
on the Company's financial condition or operating results. All leases of the
Company and each of its subsidiaries are valid and subsisting and in full force
and effect.
(m) Actions Pending. There is no action, suit, claim, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any subsidiary which questions the validity of this Agreement or the
transactions contemplated hereby or any action taken or to be taken pursuant
hereto or thereto. Except as set forth in the SEC Documents or on Schedule
3.1(m) hereto, there is no action, suit, claim, investigation or proceeding
pending or, to the knowledge of the Company, threatened, against or involving
the Company, any subsidiary or any of their respective properties or assets.
There are no outstanding orders, judgments, injunctions, awards or decrees of
any court, arbitrator or governmental or regulatory body against the Company or
any subsidiary.
(n) Necessary Authorizations. The Company and each of its subsidiaries
have all franchises, permits, licenses, consents and other governmental or
regulatory authorizations and approvals necessary for the conduct of their
respective businesses as now being conducted by them unless the failure to
possess such franchises, permits, licenses, consents and other governmental or
regulatory authorizations and approvals, individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.
(o) Taxes. The Company and each subsidiary has filed all Tax Returns
which it is required to file under applicable laws; all such Tax Returns are
true and accurate and have been prepared in compliance with all applicable laws;
the Company has paid all Taxes due and owing by it or any subsidiary (whether or
not such Taxes are required to be
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shown on a Tax Return) and has withheld and paid over to the appropriate taxing
authorities all Taxes which it is required to withhold from amounts paid or
owing to any employee, stockholder, creditor or other third parties, except
where the failure to do so, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect; and since December 31,
1999, the charges, accruals and reserves for Taxes with respect to the Company
(including any provisions for deferred income taxes) reflected on the books of
the Company are adequate to cover any Tax liabilities of the Company if its
current tax year were treated as ending on the date hereof.
No claim has been made by a taxing authority in a jurisdiction where
the Company does not file tax returns that the Company or any subsidiary is or
may be subject to taxation by that jurisdiction. Except as set forth in the SEC
Documents or on Schedule 3(o) hereto, there are no foreign, federal, state or
local tax audits or administrative or judicial proceedings pending or being
conducted with respect to the Company or any subsidiary; no information related
to Tax matters has been requested by any foreign, federal, state or local taxing
authority; and, except as disclosed above, no written notice indicating an
intent to open an audit or other review has been received by the Company or any
subsidiary from any foreign, federal, state or local taxing authority. There are
no material unresolved questions or claims concerning the Company's Tax
liability. The Company (A) has not executed or entered into a closing agreement
pursuant to Section 7121 of the Internal Revenue Code or any predecessor
provision thereof or any similar provision of state, local or foreign law; and
(B) has not agreed to or is required to make any adjustments pursuant to Section
481 (a) of the Internal Revenue Code or any similar provision of state, local or
foreign law by reason of a change in accounting method initiated by the Company
or any of its subsidiaries or has any knowledge that the IRS has proposed any
such adjustment or change in accounting method, or has any application pending
with any taxing authority requesting permission for any changes in accounting
methods that relate to the business or operations of the Company. The Company
has not been a United States real property holding corporation within the
meaning of Section 897(c)(2) of the Internal Revenue Code during the applicable
period specified in Section 897(c)(1)(A)(ii) of the Internal Revenue Code.
The Company has not made an election under Section 341(f) of the
Internal Revenue Code. The Company is not liable for the Taxes of another person
that is not a subsidiary of the Company (A) under Treas. Reg. Section 1.1502-6
(or comparable provisions of state, local or foreign law), (B) as a transferee
or successor, (C) by contract or indemnity or (D) otherwise. The Company is not
a party to any tax sharing agreement. The Company has not made any payments, is
not obligated to make payments nor is it a party to an agreement that could
obligate it to make any payments that would not be deductible under Section 280G
of the Internal Revenue Code.
For purposes of this Section 3.1(o):
"IRS" means the United States Internal Revenue Service.
"Tax" or "Taxes" means federal, state, county, local, foreign, or
other income, gross receipts, ad valorem, franchise, profits, sales or use,
transfer, registration, excise, utility,
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environmental, communications, real or personal property, capital stock,
license, payroll, wage or other withholding, employment, social security,
severance, stamp, occupation, alternative or add-on minimum, estimated and other
taxes of any kind whatsoever (including, without limitation, deficiencies,
penalties, additions to tax, and interest attributable thereto) whether disputed
or not.
"Tax Return" means any return, information report or filing with respect to
Taxes, including any schedules attached thereto and including any amendment
thereof.
(p) Certain Fees. Except as set forth on Schedule 3.1(p) hereto, no
brokers, finders or financial advisory fees or commissions will be payable by
the Company or any subsidiary with respect to the transactions contemplated by
this Agreement.
(q) Disclosure. Neither this Agreement or the Schedules hereto nor any
other documents, certificates or instruments furnished to the Purchaser by or on
behalf of the Company or any subsidiary in connection with the transactions
contemplated by this Agreement contains any untrue statement of a material fact
or omits to state a material fact necessary in order to make the statements made
herein or therein, in the light of the circumstances under which they were made
herein or therein, not misleading.
(r) Operation of Business. Except as set forth in the SEC Documents or
on Schedule 3.1(r) hereto, the Company and each of the subsidiaries owns or
possesses all patents, trademarks, service marks, trade names, copyrights,
licenses and authorizations, and all rights with respect to the foregoing, which
are necessary for the conduct of its business as now conducted without any
conflict with the rights of others.
(s) Insurance. Except as disclosed in the SEC Documents or on Schedule
3.1(s) hereto, the Company carries or will have the benefit of insurance in such
amounts and covering such risks as is adequate for the conduct of its business
and the value of its properties and as the Company believes is customary for
companies engaging in similar businesses and similar industries.
(t) Books and Records. The records and documents of the Company and
its subsidiaries accurately reflect in all material respects the information
relating to the business of the Company and the subsidiaries, the location and
collection of their assets, and the nature of all transactions giving rise to
the obligations or accounts receivable of the Company or any subsidiary.
(u) Material Agreements. Except as set forth in the SEC Documents, or
on Schedule 3.1(u) hereto, neither the Company nor any subsidiary is a party to
any written or oral contract, instrument, agreement, commitment, obligation,
plan or arrangement, a copy of which would be required to be filed with the SEC
as an exhibit to a registration statement on Form S-1 or other applicable form
(collectively, "Material Agreements") if the Company or any subsidiary were
registering securities under the Securities Act. Except as set forth in Schedule
3.1(u), the Company and each of its subsidiaries has in all material respects
performed all the obligations required to be performed by them to date under the
foregoing agreements, have
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received no notice of default and, to the Company's knowledge, are not in
default under any Material Agreement now in effect, the result of which could
cause a Material Adverse Effect. Except as set forth in the SEC Documents, no
written or oral contract, instrument, agreement, commitment, obligation, plan or
arrangement of the Company or of any subsidiary limits or shall limit the
payment of dividends on the Company's Common Stock.
(v) Transactions with Affiliates. Except as set forth in the SEC
Documents or on Schedule 3.1(v) hereto, there are no loans, leases, agreements,
contracts, royalty agreements, management contracts or arrangements or other
continuing transactions exceeding $100,000 between (A) the Company, any
subsidiary or any of their respective customers or suppliers on the one hand,
and (B) on the other hand, any officer, employee, consultant or director of the
Company, or any of its subsidiaries, or any person owning 5% or more of the
capital stock of the Company (other than General Motors Corporation) or any
subsidiary or any member of the immediate family of such officer, employee,
consultant, director or stockholder or any corporation or other entity
controlled by such officer, employee, consultant, director or stockholder, or a
member of the immediate family of such officer, employee, consultant, director
or stockholder.
(w) Accuracy of Registration Statement. The Registration Statement and
the Prospectus do not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein not misleading in light of the circumstances under
which they were made; provided, however, the Company makes no representations or
warranties as to the information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in conformity with the
information furnished in writing to the Company by the Purchaser specifically
for inclusion in the Registration Statement.
(x) Employees. Neither the Company nor any subsidiary has any
collective bargaining arrangements or agreements covering any of its employees,
except as set forth in the SEC Documents or on Schedule 3.1(x) hereto. Except as
set forth in the SEC Documents or on Schedule 3.1(x) hereto, to the Company's
knowledge, neither the Company nor any subsidiary is in breach of any employment
contract, agreement regarding proprietary information, noncompetition agreement,
nonsolicitation agreement, confidentiality agreement, or any other similar
contract or restrictive covenant, relating to the right of any officer, employee
or consultant to be employed or engaged by the Company or such subsidiary. Since
the date of the financial statements in the Company's most recently filed Form
10-K, no officer, consultant or key employee of the Company or any subsidiary
whose termination, either individually or in the aggregate, could have a
Material Adverse Effect, has terminated or, to the knowledge of the Company, has
any present intention of terminating his or her employment or engagement with
the Company or any subsidiary.
(y) Absence of Certain Developments. Except as provided in SEC
Documents or on Schedule 3.1(y) hereto, and except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect, since the date
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of the financial statements contained in the Company's most recently filed Form
10-Q or Form 10-K, whichever is most current, neither the Company nor any
subsidiary has:
(i) issued any stock, bonds or other corporate securities or any
rights, options or warrants with respect thereto than pursuant to Board approved
stock option plans or arrangements and the Ladenburg Xxxxxxxx warrant;
(ii) borrowed any amount or incurred or become subject to any
liabilities (absolute or contingent) except current liabilities incurred in the
ordinary course of business which are comparable in nature and amount to the
current liabilities incurred in the ordinary course of business during the
comparable portion of its prior fiscal year, as adjusted to reflect the current
nature and volume of the Company's or such subsidiary's business;
(iii) discharged or satisfied any lien or encumbrance or paid any
obligation or liability (absolute or contingent), other than current liabilities
paid in the ordinary course of business;
(iv) declared or made any payment or distribution of cash or
other property to stockholders with respect to its stock, or purchased or
redeemed, or made any agreements so to purchase or redeem, any shares of its
capital stock;
(v) sold, assigned or transferred any other tangible assets, or
canceled any debts or claims, except in the ordinary course of business;
(vi) sold, assigned or transferred any patent rights, trademarks,
trade names, copyrights, trade secrets or other intangible assets or
intellectual property rights, or disclosed any proprietary confidential
information to any person except to customers in the ordinary course of business
or to the Purchaser or its representatives;
(vii) suffered any material losses or waived any rights of
material value, whether or not in the ordinary course of business, or suffered
the loss of any material amount of prospective business;
(viii) made any changes in employee compensation except in the
ordinary course of business and consistent with past practices;
(ix) made capital expenditures or commitments therefor that
aggregate in excess of $500,000;
(x) entered into any other material transaction, whether or not
in the ordinary course of business;
(xi) suffered any material damage, destruction or casualty loss,
whether or not covered by insurance;
(xii) experienced any material problems with labor or management
in connection with the terms and conditions of their employment; or
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(xiii) effected any two or more events of the foregoing kind
which in the aggregate would be material to the Company or its subsidiaries.
(z) Governmental Approvals. Except as set forth in the SEC Documents
or on Schedule 3.1(z) hereto, and except for the filing of any notice prior or
subsequent to any Settlement that may be required under applicable federal or
state securities laws (which if required, shall be filed on a timely basis),
including the filing of a registration statement or post-effective amendment
pursuant to this Agreement, no authorization, consent, approval, license,
exemption of, filing or registration with any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, is or
will be necessary for, or in connection with, the delivery of the Shares, or for
the performance by the Company of its obligations under this Agreement.
(aa) Use of Proceeds. The proceeds from the sale of the Shares will be
used by the Company and its subsidiaries as described in the Prospectus.
Section 3.2. Representations and Warranties of the Purchaser. The Purchaser
hereby makes the following representations and warranties to the Company:
(a) Organization and Standing of the Purchaser. The Purchaser is a
corporation duly incorporated, validly existing and in good standing under the
laws of the British Virgin Islands.
(b) Authorization and Power. The Purchaser has the requisite corporate
power and corporate authority to enter into and perform this Agreement and to
purchase the Shares being sold to it hereunder. This Agreement has been duly
executed and delivered by the Purchaser and constitutes the valid and binding
obligation of the Purchaser enforceable against the Purchaser in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation,
conservatorship, receivership or similar laws relating to, or affecting
generally the enforcement of, creditors' rights and remedies or by other
equitable principles of general application.
(c) No Conflicts. The execution, delivery and performance of this
Agreement and the consummation by the Purchaser of the transactions contemplated
hereby or relating hereto do not and will not (i) result in a violation of
Purchaser's charter documents or bylaws or (ii) conflict with, or constitute a
default (or an event which with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of any agreement, indenture or instrument to which
the Purchaser is a party, or result in a violation of any law, rule, or
regulation, or any order, judgment or decree of any court or governmental agency
applicable to the Purchaser or its properties (except for such conflicts,
defaults and violations as would not, individually or in the aggregate, have a
Material Adverse Effect on Purchaser). The Purchaser is not required to obtain
any consent, authorization or order of, or make any filing or registration with,
any court or governmental agency in order for it to execute, deliver or perform
any of its obligations under this Agreement or to purchase the Shares in
accordance with the terms hereof.
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(d) Information. The Purchaser and its advisors, if any, have been
furnished with all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Shares which
have been requested by the Purchaser and the Purchaser and its advisors, if any,
have been afforded the opportunity to ask questions of the Company. The
Purchaser understands that its investment in the Shares involves a high degree
of risk. The Purchaser has sought such accounting, legal and tax advice as it
has considered necessary to make an informed decision with respect to its
acquisition of the Shares.
(e) No Governmental Review. The Purchaser understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Shares or the
fairness or suitability of the investment in the Shares nor have such
authorities passed upon or endorsed the merits of the offering of the Shares.
(f) No "At-The-Market" Offerings. The Purchaser will not resell the
shares in a manner constituting an "at-the-market" offering under Securities
Exchange Act Rule 415(a)(4).
ARTICLE IV
COVENANTS
The Company covenants with the Purchaser as follows:
Section 4.1. Securities Compliance.
If applicable, the Company shall notify the Principal Market, in
accordance with their rules and regulations, of the transactions contemplated by
this Agreement, and shall take all other necessary action and proceedings as may
be required and permitted by applicable law, rule and regulation, for the legal
and valid issuance of the Shares to the Purchaser or subsequent holders.
Section 4.2. Registration and Listing. The Company will cause its
Common Stock to continue to be registered under Sections 12(b) or 12(g) of the
Exchange Act, will comply in all respects with its reporting and filing
obligations under the Exchange Act, will comply with all requirements related to
any registration statement filed pursuant to this Agreement, and will not take
any action or file any document (whether or not permitted by the Securities Act
or the Exchange Act or the rules promulgated thereunder) to terminate or suspend
such registration or to terminate or suspend its reporting and filing
obligations under the Exchange Act or Securities Act, until 30 days after the
final Settlement Date for the Shares. The Company will use its reasonable best
efforts to continue the listing or trading of its Common Stock on the Principal
Market and will comply in all respects with the Company's reporting, filing and
other obligations under the bylaws or rules of the Principal Market and shall
provide the Purchaser with copies of any correspondence to or from such
Principal Market which
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questions or threatens delisting of the Common Stock, within three (3) Trading
Days of the Company's receipt thereof, until the Purchaser has disposed of all
of the Shares. The Company will arrange, if necessary, for the qualification of
the Common Stock for sale under the laws of such jurisdictions as the Purchaser
may designate, will maintain such qualifications in effect so long as required
for the distribution of the Common Stock and will pay any fees required by NASD
Regulation, Inc., if any, in connection with its review of the offering,
provided that, in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action that would subject it to (a) service of process in suits, in any
jurisdiction where it is not now so subject or (b) subject it to taxation in any
such jurisdiction.
Section 4.3. Registration Statement. The Company shall cause the
Registration Statement to remain effective from the date hereof until 30
calendar days after the final Settlement Date. Prior to the termination of this
Agreement, the Company will not file any amendment to the Registration Statement
unless the Company has furnished the Purchaser a copy for its review prior to
filing and will not file any such proposed amendment or supplement to which
Purchaser reasonably objects. The Company will cause the Registration Statement,
properly completed, and any supplement thereto to be filed with the SEC pursuant
to the applicable paragraph of Rule 424(b) within the time period prescribed and
in accordance with Rules 415, 424(b) and 430A and will provide evidence
satisfactory to Purchaser of such timely filing. On the date of closing of each
Settlement Date, the Company shall provide the Purchaser with copies of the
Pricing Supplement relating to such Settlement Date. Such Pricing Supplement
shall contain information required therein by the Securities Act and
regulations, including, without limitation, Purchaser's plan of distribution of
the Shares, and, except to the extent the Purchaser shall agree in writing to a
modification, shall be in all substantive respects in the form furnished to the
Purchaser on or prior to the commencement of the Settlement Date.
Section 4.4. Accuracy of Registration Statement.On each Settlement
Date, the Registration Statement and the Prospectus shall not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; in light of the circumstances under which they were made; and on the
Settlement Date or date of filing of the Pricing Supplement, the Registration
Statement and the Prospectus will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, the Company makes no representations or
warranties as to the information contained in or omitted from the Registration
Statement and the Prospectus in reliance upon and in conformity with the
information furnished in writing to the Company by the Purchaser specifically
for inclusion in the Registration Statement and the Prospectus.
Section 4.5. Other Agreements. The Company shall not enter into any
agreement the terms of which such agreement would restrict or impair the ability
of the Company to perform its obligations under this Agreement.
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Section 4.6. Notice of Certain Events Affecting Registration. The
Company will immediately notify the Purchaser upon the occurrence of any of the
following events in respect of the Registration Statement or related Prospectus
in respect of the Shares: (i) receipt of any request for additional information
from the SEC or any other federal or state governmental authority during the
period of effectiveness of the Registration Statement the response to which
would require any amendments or supplements to the Registration Statement or
related Prospectus; (ii) the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose;
(iii) receipt of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Shares for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose; (iv) the happening of any event that makes any statement made in the
Registration Statement or related Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or
that requires the making of any changes in the Registration Statement, related
Prospectus or documents so that, in the case of the Registration Statement, it
will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and that in the case of the related Prospectus, it will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and (v) the Company's reasonable determination that a post-effective
amendment to the Registration Statement would be appropriate; and the Company
will promptly make available to the Purchaser any such supplement or amendment
to the related Prospectus.
Section 4.7. Compliance with Law. Neither the Company nor any of its
affiliates (as that term is defined in Rule 405 under the Securities Act) has
taken, nor will any of them take, directly or indirectly, any action designed to
cause or that would result in, or which constitutes or that might reasonably be
expected to constitute, the stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of the Common Stock.
The Purchaser covenants with the Company as follows:
Section 4.8. Compliance With Law. The Purchaser's trading and
distribution activities with respect to the Shares will be in compliance with
all applicable state and federal securities laws, rules and regulations
(including, without limitation, Regulation M) and the rules and regulations of
the Nasdaq Stock Market. Neither the Purchaser nor any of its affiliates (as
that term is defined in Rule 405) has taken, nor will any of them take, directly
or indirectly, any action designed to cause or that would result in, or which
constitutes or that might reasonably be expected to constitute, the
stabilization or manipulation of the price of the Common Stock to facilitate the
sale or resale of the Common Stock.
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ARTICLE V
CONDITIONS TO SETTLEMENT
Section 5.1. Conditions Precedent to the Obligation of the Company to
Sell the Shares. The obligation hereunder of the Company to issue and sell the
Shares to the Purchaser is subject to the satisfaction or waiver, at or before
each Settlement Date of each of the conditions set forth below. These conditions
are for the Company's sole benefit and may be waived by the Company at any time
in its sole discretion.
(a) Accuracy of the Purchaser's Representations and Warranties.
The representations and warranties of the Purchaser shall be true and correct in
all material respects as of the date when made and as of the Settlement Date as
though made at that time, except for representations and warranties that speak
as of a particular date.
(b) Performance by the Purchaser. The Purchaser shall have
performed, satisfied and complied in all material respects with all material
covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by the Purchaser at or prior to the Settlement Date.
(c) No Proceedings or Litigation. No action, suit or proceeding
before any arbitrator or any governmental authority shall have been commenced,
and no investigation by any governmental authority shall have been threatened,
against the Purchaser or the Company or any subsidiary, or any of the officers,
directors or affiliates of the Purchaser or the Company or any subsidiary
seeking to restrain, prevent or change the transactions contemplated by this
Agreement, or seeking damages in connection with such transactions.
(d) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
Section 5.2. Conditions Precedent to the Obligation of the Purchaser
to Purchase the Shares. The obligation hereunder of the Purchaser to perform its
obligations under this Agreement and to purchase the Shares is subject to the
satisfaction or waiver, at or before each Settlement Date, of each of the
conditions set forth below. These conditions are for the Purchaser's sole
benefit and may be waived by the Purchaser at any time in its sole discretion.
(a) Accuracy of the Company's Representations and Warranties.
Each of the representations and warranties of the Company shall be true and
correct in all material respects as of the date when made and as of the
Settlement Date as though made at that time (except for representations and
warranties that speak as of a particular date).
(b) Performance by the Company. The Company shall have performed,
satisfied and complied in material all respects with all material covenants,
agreements
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and conditions required by this Agreement to be performed, satisfied or complied
with by the Company at or prior to the Settlement Date.
(c) No Injunction. No statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by any court or governmental authority of competent jurisdiction which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
(d) No Proceedings or Litigation. No action, suit or proceeding
before any arbitrator or any governmental authority shall have been commenced
against the Purchaser or the Company or any subsidiary, or any of the officers,
directors or affiliates of the Purchaser or the Company or any subsidiary which
restrains, prevents or materially changes the transactions contemplated by this
Agreement, or which has obtained a judgment for damages in connection with such
transactions.
(e) Opinion of Counsel. At or prior to the initial Settlement
Date, and at or prior to each Settlement Date thereafter if reasonably requested
by the Purchaser due to a specific event identified to the Company by the
Purchaser, the Purchaser shall have received an opinion of counsel to the
Company, dated the date of the such Settlement, in the form of Exhibit A hereto.
(f) Effective Registration Statement. The Registration Statement
shall be effective on the Settlement Date.
(g) No Suspension. Trading in the Company's Common Stock shall
not have been suspended by the SEC or the Principal Market (except for any
suspension of trading of limited duration agreed to by the Company, which
suspension shall be terminated prior to the next Settlement Date), and, at any
time subsequent to the execution of this Agreement and prior to the commencement
of any Settlement Period, trading in securities generally as reported on the
Principal Market shall not have been suspended or limited, or minimum prices
shall not have been established on securities whose trades are reported on the
Principal Market unless the general suspension or limitation shall have been
terminated prior to the commencement of such Settlement Period.
(h) Comfort Letter of Accountants. At or prior to the initial
Settlement Date, the Purchaser shall have received from KPMG LLP a letter, in
form and substance satisfactory to the Purchaser, addressed to the Purchaser and
the Board of Directors of the Company and dated the date of the first Settlement
(i) confirming that they are independent public accountants within the meaning
of the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, and (ii) stating, as of the date of the first Settlement (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the first Settlement Date), the
conclusions and findings of such firm with respect to the financial information
and other matters ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
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(i) Officers' Certificate. The Company shall furnish to the
Purchaser as of the date hereof and shall have furnished to Purchaser on each
Settlement Date a certificate, dated such date, of its Chairman of the Board,
its President or a Vice President and its Senior Vice President, Chief Financial
Officer or Treasurer (the "Officers' Certificate") stating that:
(i) The representations and warranties of the Company in
this Agreement are true and correct in all material respects as if made at and
of the date hereof, or, if the Officers' Certificate is being delivered on a
Settlement Date, have been throughout the Settlement Period, true and correct;
provided, however, that in all cases any qualifications as to materiality shall
be considered in the aggregate; the Company has in all material respects
complied with all its agreements contained herein; and the Company has in all
respects satisfied the conditions to Settlement on its part to be complied with
or satisfied at such date; and
(ii) They have carefully examined the Registration Statement
and the Prospectus and, in their opinion (A) as of such date, the Registration
Statement and Prospectus did not include any untrue statement of a material fact
and did not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (B) since such date
no event has occurred which should have been set forth in a supplement or
amendment to the Registration Statement or the Prospectus which was not included
in such a supplement or amendment. ARTICLE VI
PURCHASE TERMS
Section 6.1. Purchase Terms. Subject to the satisfaction of the
conditions set forth in this Agreement, the parties agree as follows:
(a) The aggregate Purchase Price of the shares of Common Stock
purchased by the Purchaser with respect to each Settlement Period shall be
determined as set forth in Section 6.1(b) herein and shall be settled on every
tenth business day during the Pricing Period unless the Purchaser shall deliver
written notice to the Company electing a five day settlement interval, in which
case settlement shall occur on every fifth business day during the Pricing
Period(each such date a "Settlement Date").
(b) The number of Shares of Common Stock to be issued on each
Settlement Date shall be a number of shares equal to the sum of the quotients
(for each Trading Day within the Settlement Period) of (x) 1/60th of the
Commitment Amount (or $33,333.33 per day), and (y) the Purchase Price for each
Trading Day during such Settlement Period, subject to the following adjustment:
(i) if trading of the Common Stock on the Principal Market
is suspended for more than three (3) hours, in the aggregate, on any Trading Day
during the Settlement Period, the Commitment Amount shall be reduced by 1/60th
and that day shall be
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withdrawn from the Settlement Period, or, at Purchaser's sole option, Purchaser
shall purchase the number of Shares to be purchased on such Trading Day at the
Purchase Price.
(c) The Purchaser shall have the option to purchase more than
that portion of the Commitment Amount scheduled to be settled on any particular
Trading Day during the Pricing Period (up to a limit of the entire remaining
Commitment Amount not yet funded) by written notice to the Company delivered
before 6:00 p.m ET on such Trading Day. The purchase price for all of such
additional Shares shall be the Purchase Price for the other Shares to be
purchased on such Trading Day.
(d) On or before each Settlement Date, the Shares purchased by
the Purchaser shall be electronically delivered to The Depository Trust Company
("DTC") on the Purchaser's behalf, registered in such names and in such
denominations as the Purchaser shall request in writing not less than two (2)
Trading Days prior to the applicable Settlement Date. Upon the Company
electronically delivering whole shares of Common Stock to the Purchaser or its
designees via DWAC by 1:00 pm ET, and satisfaction by the Company of the other
conditions in Section 5.2, the Purchaser shall wire transfer immediately
available funds to the Company's designated account on such day. Upon the
Company electronically delivering whole shares of Common Stock to the Purchaser
or its designees via DWAC after 1:00 pm ET, the Purchaser shall wire transfer
next day available funds to the Company's designated account on such day. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligations of the Company and
the Purchaser hereunder. Without limiting Purchaser's other remedies, the
Company shall reimburse Purchaser for direct losses caused by any "buy-in" due
to the Company's failure to timely deliver Shares.
ARTICLE VII
TERMINATION
Section 7.1. Termination. This Agreement may be terminated by the
written mutual consent of the Company and the Purchaser, provided, that no
termination shall be effective prior to the end of the next scheduled Settlement
Date.
Section 7.2. Effect of Termination. In the event of termination by the
Purchaser, written notice thereof shall forthwith be given to the other party
and the transactions contemplated by this Agreement shall be terminated without
further action by either party. If this Agreement is terminated as provided in
Section 7.1 herein, this Agreement shall become void and of no further force and
effect upon the conclusion of the current Pricing Period, if any, except for
Sections 8.1, 8.2 and 8.9. Nothing in this Section 7.2 shall be deemed to
release the Company or the Purchaser from any liability for any breach under
this Agreement, or to impair the rights of the Company and the Purchaser to
compel specific performance by the other party of its obligations under this
Agreement.
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ARTICLE VIII
MISCELLANEOUS
Section 8.1. Fees and Expenses. The Company agrees to pay (i) the
costs incident to the authorization, issuance, sale and delivery of the Common
Stock and any taxes payable in that connection; (ii) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (iii) the costs of
distributing the Registration Statement and any post-effective amendments
thereof (including, in each case, exhibits and filings incorporated by
reference), the Prospectus or any document incorporated by reference therein,
all as provided in this Agreement; (iv) the costs of producing and distributing
this Agreement and any other related documents in connection with the offering,
purchase, sale and delivery of the Common Stock; (v) any filing fees incident to
securing any required review by NASD Regulation, Inc. of the terms of sale of
the Common Stock; (vi) any applicable listing or other fees; (vii) the fees and
expenses of qualifying the Common Stock under the securities laws of the several
jurisdictions and of preparing, printing and distributing a blue sky memorandum;
and (viii) all other costs and expenses incident to the performance of the
obligations of the Company under this Agreement; provided, that, except as
provided in this Section 8.1, the Purchaser shall pay their own costs and
expenses, including the costs and expenses of their counsel, any transfer taxes
on the Common Stock which they may sell and the expenses of advertising any
offering of the Common Stock made by the Purchaser.
Section 8.2. Specific Enforcement. The Company and the Purchaser
acknowledge and agree that irreparable damage would occur in the event that any
of the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent or cure
breaches of the provisions of this Agreement and to enforce specifically the
terms and provisions hereof or thereof, this being in addition to any other
remedy to which any of them may be entitled by law or equity.
Section 8.3. Entire Agreement; Amendment. This Agreement contains the
entire understanding of the parties with respect to the matters covered hereby
and, except as specifically set forth herein, neither the Company nor the
Purchaser makes any representations, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be waived or amended
other than by a written instrument signed by the party against whom enforcement
of any such amendment or waiver is sought.
Section 8.4. Notices. Any notice, demand, request, waiver or other
communication required or permitted to be given hereunder shall be in writing
and shall be effective (a) upon hand delivery or facsimile at the address or
number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid,
addressed to such address,
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or upon actual receipt of such mailing, whichever shall first occur. The
addresses for such communications shall be:
If to the Company: General Magic, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxxxx, CFO
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With copies to: Xxxxxx Xxxx & Xxxxxxxx
(which shall not 0000 Xxxxxxx Xxxx Xxxx
constitute notice): Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Purchaser:
X/x Xxxxxxx Xxxxxx & Xxxxx, X.X.
Attn: Xxxxxx Xxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Any party hereto may from time to time change its address for notices
by giving written notice of such changed address to the other party hereto in
accordance herewith.
Section 8.5. Waivers. No waiver by either party of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any other
provisions, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right accruing to it thereafter.
Section 8.6. Headings. The article, section and subsection headings in
this Agreement are for convenience only and shall not constitute a part of this
Agreement for any other purpose and shall not be deemed to limit or affect any
of the provisions hereof.
Section 8.7. Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties and their successors and assigns.
The parties hereto may not amend this Agreement or any rights or obligations
hereunder without the prior written consent of the Company and each Purchaser to
be affected by the amendment.
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Section 8.8. No Third Party Beneficiaries.This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors
and assigns and is not for the benefit of, nor may any provision hereof be
enforced by, any other person.
Section 8.9. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York, without
giving effect to the choice of law provisions. The Company and the Purchaser
agree to submit itself to the in personam jurisdiction of the state and federal
courts situated within the Southern District of the State of New York with
regard to any controversy arising out of or relating to this Agreement.
Section 8.10. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and shall become effective when counterparts have been signed by
each party and delivered to the other parties hereto, it being understood that
all parties need not sign the same counterpart. Execution may be made by
delivery by facsimile.
Section 8.11. Publicity. Neither the Company nor the Purchaser shall
issue any press release or otherwise make any public statement or announcement
with respect to this Agreement or the transactions contemplated hereby or the
existence of this Agreement unless in strict compliance with Rule 134 of the
Securities Act.
Seciton 8.12. Severability. The provisions of this Agreement are
severable and, in the event that any court or officials of any regulatory agency
of competent jurisdiction shall determine that any one or more of the provisions
or part of the provisions contained in this Agreement shall, for any reason, be
held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision or part of a
provision of this Agreement and this Agreement shall be reformed and construed
as if such invalid or illegal or unenforceable provision, or part of such
provision, had never been contained herein, so that such provisions would be
valid, legal and enforceable to the maximum extent possible, so long as such
construction does not materially adversely effect the economic rights of either
party hereto.
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Section 8.13. Further Assurances. From and after the date of this
Agreement, upon the request of the Purchaser or the Company, each of the Company
and the Purchaser shall execute and deliver such instruments, documents and
other writings as may be reasonably necessary or desirable to confirm and carry
out and to effectuate fully the intent and purposes of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorize officer as of the date first
above written.
GENERAL MAGIC, INC.
By: /s/ XXXX XXXXXXXX
----------------------------------------
Name: Xxxx Xxxxxxxx
Title: CFO
XXXX XXXXXX CAPITAL PARTNERS LTD.
By: /s/ XXXXX XXXX
----------------------------------------
Name: Xxxxx Xxxx
Title: Director
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