EXHIBIT 10.54
SUBSCRIPTION AGREEMENT
Insignia Solutions plc
00000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
The undersigned ("SUBSCRIBER") hereby tenders this Subscription
Agreement ("AGREEMENT") in accordance with and subject to the terms and
conditions set forth herein and the Private Placement Memorandum, dated November
16, 2000, including all exhibits and supplements thereto (the "MEMORANDUM").
1. SUBSCRIPTION.
1.1 The undersigned hereby irrevocably subscribes for (i) the number of
shares (the "SHARES") of American depositary shares (the "ADSs"), each ADS
representing one ordinary share, 20 xxxxx per share nominal value, of Insignia
Solutions plc (each an "ORDINARY SHARE"), a public limited company organized and
existing under the laws of England and Wales (the "COMPANY"), indicated on the
signature page attached hereto at a price of $5.00 per Share (the "ISSUE PRICE")
and (ii) warrants (the "WARRANTS") in the form of EXHIBIT A attached hereto to
subscribe for an additional number of ADSs set forth on the signature pages
attached hereto (such additional ADSs in the aggregate issuable from time to
time upon exercise of the Warrants, collectively the "WARRANT SHARES" and,
together with the Shares and the Warrants, the "SECURITIES"). At or prior to the
Closing Date (as defined below), the undersigned will make payment by wire
transfer of funds in accordance with instructions from the Company in the full
amount of the purchase price of the Shares for which the undersigned is
subscribing (the "PAYMENT").
1.2 The undersigned understands that it will not earn interest on any
funds held by the Company prior to the date of closing of the Offering (as
hereinafter defined). Xxxxxxxxx & Company, Inc. (the "PLACEMENT AGENT") and the
Company will hold the closing of the Offering (the "CLOSING") on February 12,
2001 or such other date as the Company and the Placement Agent shall agree (the
"CLOSING DATE"). Simultaneously with receipt by the Company of the requisite
payment for all Securities to be purchased by the subscribers whose
subscriptions are accepted (each, a "SUBSCRIBER") at the Closing and subject to
the satisfaction of certain conditions, the Securities so purchased will be
issued in the name of each such Subscriber or its custodian, if any, as
requested by such Subscriber.
1.3 The undersigned hereby agrees to be bound hereby upon (i) execution
and delivery to the Company, in care of the Placement Agent, of the signature
page to this Subscription Agreement and (ii) acceptance on the Closing Date by
the Company of the undersigned's subscription (the "SUBSCRIPTION").
2. OFFERING MATERIAL.
2.1 Subscriber represents and warrants that it is in receipt
of, and that it has carefully read and understands, the following items:
(a) the Memorandum;
(b) Annual Report to the Securities and Exchange Commission
(the "SEC") on Form 10-K of the Company for its fiscal year ended December 31,
1999 (the "FORM 10-K");
(c) Quarterly Report to the SEC on Form 10-Q of the Company
for the three-month period ended March 31, 2000 (the "MARCH FORM 10-Q");
(d) Quarterly Report to the SEC on Form 10-Q of the Company
for the three-month period ended June 30, 2000 (the "JUNE FORM 10-Q");
(e) Quarterly Report to the SEC on Form 10-Q of the Company
for the three-month period ended September 30, 2000 (the "SEPTEMBER FORM 10-Q");
and
(f) Proxy Statement on Schedule 14A, dated June 2, 2000, of
the Company for an Annual General Meeting held on July 18, 2000 (the "PROXY").
The Form 10-K, the March Form 10-Q, the June Form 10-Q, the September
Form 10-Q and the Proxy are referred to herein collectively as the "PUBLIC
REPORTS."
3. CONDITIONS TO SUBSCRIBER'S OBLIGATIONS.
3.1 The obligation of the Subscriber to close the transactions
contemplated by this Agreement (the "TRANSACTION") is subject to the
satisfaction on or prior to the date of the Closing (as hereinafter defined) of
the following conditions set forth in Sections 3.2 through 3.13 hereof.
3.2 The (i) representations and warranties made by the Company herein
shall be true in all material respects on and as of the Closing Date with the
same effect as if they had been made on and as of the Closing Date and (ii)
Company shall have performed in all material respects all obligations, covenants
and agreements and conditions required to be performed by it under this
Agreement at or prior to the Closing Date, and the Subscriber shall have
received a certificate of the Chief Executive Officer to the same effect.
3.3 All approvals and consents of or filings with governmental or
regulatory authorities and all approvals and consents of any persons required to
permit the consummation of all of the transactions contemplated by this
Agreement shall have been made or obtained, as the case may be, to the
reasonable satisfaction of the Subscriber.
3.4 All proceedings to be taken in connection with the Transaction are
to be consummated at or prior to the Closing, and all documents incidental
thereto shall be reasonably satisfactory in form and substance to the Subscriber
and its counsel, and the Subscriber and its counsel shall have received copies
of all documents and information which it may have reasonably requested in
connection with the transactions and of all corporate proceedings in connection
therewith, in form and substance reasonably satisfactory to Subscriber and its
counsel.
3.5 The Company shall have delivered to the Subscriber duly executed
American depositary receipts (in such denominations as the Subscriber shall
request) representing the Shares.
3.6 The Company shall have delivered to the Subscriber (or its
custodian) duly executed Warrants (in such denominations as the Subscriber shall
request), dated the Closing Date.
3.7 The Company shall have delivered (or cause to be delivered)
opinions of counsel to the Company addressed to the Subscriber and the Placement
Agent in form, scope and substance satisfactory to the Subscriber and the
Placement Agent.
3.8 The ADSs, including all Shares and Warrant Shares, are included for
quotation on the Nasdaq Stock Market, Inc. ("NASDAQ") and trading of the ADSs
shall not have been suspended by Nasdaq, the SEC, the National Association of
Securities Dealers, Inc. (the "NASD") or other regulatory authority, and, except
as set forth in the Memorandum, no de-listing or suspension shall be reasonably
likely for the foreseeable future.
3.9 No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered into, promulgated or endorsed by any
court or governmental authority of competent jurisdiction or any self-regulatory
organization having authority over the matters contemplated hereby which
prohibits the consummation of any of the transactions contemplated by this
Agreement.
3.10 The Company shall have filed, if applicable, an Additional Listing
Application (and no additional time shall be required for the effectiveness
thereof) with respect to all Shares and Warrant Shares with the NASD and shall
have provided a copy thereof to the Subscriber.
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3.11 The Placement Agent shall have received the executed
letters from the persons listed in Section 4.26.
3.12 The Company shall have received a duly executed subscription
agreement in the form of this Agreement from Wind River Systems, Inc.
3.13 The Subscriber shall have received the officer's certificate
described in Section 4.4 dated as of the Closing Date and there shall be no
changes from the date of signing the Agreement to the date of Closing.
4. REPRESENTATIONS AND WARRANTIES; COVENANTS.
The Company represents and warrants that, at the date of this
Agreement:
4.1 The Company is a public limited company, duly incorporated and
validly existing under the laws of England and Wales and registered in England
under the Companies Act of 1985 and has been in continuous existence since
incorporation. Each of the Company's subsidiaries is a corporation, limited
liability company or other entity duly organized, validly existing and, to the
extent applicable, in good standing under the laws of the jurisdiction of its
organization. The Company and each of its subsidiaries have full power and
authority to conduct their respective businesses as they are presently being
conducted and to own, lease and operate their respective properties and assets.
The Company and each of its subsidiaries are duly qualified to do business as
foreign entities and are in good standing in each jurisdiction in which the
character or location of the properties and assets owned or operated by them or
the nature of the businesses conducted by them makes such qualification
necessary.
4.2 The Memorandum and the exhibits thereto do not contain any untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
4.3 (a) The Company has the requisite corporate power and authority (i)
to enter into and perform its obligations under this Agreement and any documents
related hereto and (ii) to issue and sell to Subscriber, and to perform its
obligations with respect to, the Securities in accordance with the terms hereof
and thereof, as applicable; (b) the execution, delivery and performance of this
Agreement and any documents related hereto by the Company and the consummation
by it of the transactions contemplated hereby and thereby have been duly
authorized by all necessary corporate action, and no further consent or
authorization of the Company, its board of directors, or its shareholders or any
other person, body or agency is required with respect to any of the transactions
contemplated hereby or thereby (whether under rules of Nasdaq, NASD or
otherwise) or the declaration or ordering of effectiveness by the SEC of the
registration statement or the statements as contemplated by this Agreement; (c)
this Agreement has been duly authorized, executed and delivered by the Company;
and (d) this Agreement constitutes a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms.
4.4 The capitalization of the Company as of the date of this Agreement,
including the authorized share capital, the number of shares issued and
outstanding, the number of shares reserved for issuance pursuant to the
Company's stock option plans and employee stock purchase plans, the number of
shares reserved for issuance pursuant to securities exercisable for, convertible
into or exchangeable for any shares and the number of Ordinary Shares
represented by ADSs, is set forth on SCHEDULE 4.4. All of the issued Ordinary
Shares have been duly and validly authorized and issued, are fully paid and were
not issued in violation of, or subject to, any preemptive, subscription or other
similar rights of any shareholders of the Company or any liens or encumbrances.
All of the outstanding ADSs have been duly and validly authorized and issued and
are entitled to the benefits specified in the corresponding American depositary
receipts ("ADRs") and in the Deposit Agreement (the "DEPOSIT AGREEMENT"), dated
November 17, 1995, as amended, between the Company and The Bank of New York, as
Depositary (the "DEPOSITARY"). Except as set forth on SCHEDULE 4.4, as of the
date of this Agreement, (i) there are no outstanding options, warrants, scrip,
rights to subscribe for, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into or exercisable or
exchangeable for, any shares in the Company or any of its subsidiaries, or
contracts, commitments, understandings or arrangements by which the Company or
any of its subsidiaries is or may become bound to issue additional shares in the
Company or any of its subsidiaries, and (ii) there are no agreements or
arrangements under which the Company or any of its subsidiaries is obligated to
register the sale of any of its or their securities under the Securities Act of
1933, as amended (the "SECURITIES ACT"). The
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Company has furnished to Subscriber true, correct and complete copies of the
Company's Memorandum of Association as currently in effect ("MEMORANDUM OF
ASSOCIATION"), and the Company's Articles of Association as currently in
effect (the "ARTICLES OF ASSOCIATION"). The Company has set forth on SCHEDULE
4.4 all instruments and agreements (other than the Memorandum of Association
and Articles of Association) governing securities convertible into or
exercisable or exchangeable for the Ordinary Shares (including in the form of
ADSs) of the Company (and the Company shall provide to the Subscriber copies
thereof upon the request of Subscriber). Except as set forth in the Public
Reports and in the ordinary course of business consistent with past practice
subsequent to the date of the Public Reports, the Company has no indebtedness
for borrowed money and no agreement providing for indebtedness for borrowed
money. Except as set forth on SCHEDULE 4.4, the Company has no share purchase
agreements, rights plans or agreements containing similar provisions and no
agreements containing anti-dilution provisions. Except as set forth on
SCHEDULE 4.4 or that have been waived prior to Closing, no anti-dilution
provisions which have, individually or in the aggregate, any dilutive effect
on Subscriber's investment are triggered as a result of any of the
transactions contemplated hereby. The Company shall provide Subscriber with a
written update of this representation signed by the Company's Chief Executive
Officer or Chief Financial Officer on behalf of the Company as of the date of
the Closing and it shall be a condition to Subscriber's obligations at
Closing that there are no material changes in such capitalization since the
Company's representation on the date hereof. The Company has no subsidiaries,
except as provided on SCHEDULE 4.4. All such subsidiaries included on
SCHEDULE 4.4 are one hundred percent (100%) owned by the Company. Except as
provided in SCHEDULE 4.4, the Company has no investments, either debt or
equity, in any other entity.
4.5 (a) The Shares and the Ordinary Shares represented by such Shares
are duly authorized and reserved for issuance, and, upon issuance in accordance
with the terms hereof, will be validly issued, fully paid, non-assessable and
free and clear from all liens, claims and encumbrances, will not be subject to
any preemptive rights or other similar rights of shareholders of the Company and
the Subscriber will acquire good and marketable title to the Shares, free and
clear of all liens, claims and encumbrances. The holders of Ordinary Shares will
not, upon issuance, be subject to personal liability to contribute to the assets
or liabilities of the Company in their capacity as holders of such shares. No
personal liability attaches to the registered holders of Ordinary Shares by
reason of their being registered holders thereof. Upon issuance, the Shares are
entitled to the benefits specified in the corresponding ADRs and in the Deposit
Agreement. The Board of Directors of the Company has approved the issuance of
Shares pursuant to the terms hereof. No further corporate authorization or
approval is required under the rules of Nasdaq with respect to the transactions
contemplated by this Agreement, including, without limitation, the issuance of
the Shares and the inclusion thereof for trading on Nasdaq.
(b) Upon issue, the Subscriber will acquire good and
marketable title to the Warrants, free and clear of all liens, claims and
encumbrances. The Warrant Shares and the Ordinary Shares represented by such
Warrant Shares are duly authorized and reserved for issuance. Upon exercise of
the Warrants, in whole or, from time to time, in part, and upon payment of the
exercise price therefor, in accordance with the terms of the Warrants, the
Subscriber will acquire good and marketable title to the Warrant Shares, free
and clear from all liens, claims and encumbrances, will not be subject to any
preemptive rights or other similar rights of shareholders of the Company and the
Warrant Shares will be validly issued, fully paid and non-assessable. Upon
issuance, the Warrant Shares will be entitled to the benefits specified in the
corresponding ADRs and in the Deposit Agreement. The Board of Directors of the
Company has approved the issuance of the Warrants and the Warrant Shares
pursuant to the terms hereof. No further corporate authorization or approval is
required under the rules of Nasdaq with respect to the transactions contemplated
by this Agreement, including, without limitation, the issuance of the Warrants
and the inclusion thereof of the Warrant Shares for trading on Nasdaq.
4.6 The execution, delivery and performance of this Agreement by the
Company, and the consummation by the Company of the transactions contemplated
hereby (including, without limitation, the issuance and reservation for
issuance, as applicable, of the Shares and the Warrant Shares and the
Subscriber's purchase and acquisition of the Securities) do not and will not (a)
result in a violation of the Memorandum of Association and Articles of
Association, (b) 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 Company or any of its
subsidiaries is a party or (c) result in a violation of any law, rule,
regulation, order, judgment or decree (including, without limitation, United
States of America federal and state securities laws and regulations and the laws
of England and Wales) applicable to the Company or any of its subsidiaries, or
by which any property or asset of the Company or any of its subsidiaries
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is bound or affected. Neither the Company nor any of its subsidiaries is in
violation of its Memorandum of Association, its Articles of Association or
other organizational documents, and neither the Company nor any of its
subsidiaries is in default (and no event has occurred which, with notice or
lapse of time or both, would put the Company or any of its subsidiaries in
default) under, nor has there occurred any event giving others (with notice
or lapse of time or both) any rights of termination, amendment, acceleration
or cancellation of, any agreement, indenture or instrument to which the
Company or any of its subsidiaries is a party. The business of the Company
and its subsidiaries is not being conducted, and shall not be conducted so
long as Subscriber owns any of the Securities, in violation of any law,
ordinance, rule, regulation, order, judgment or decree of any governmental
entity, court or arbitration tribunal. Except as set forth on SCHEDULE 4.6,
the Company is not required to obtain any consent, authorization or order of,
or make any filing or registration with, any court or governmental agency or
any regulatory or self-regulatory agency in order for it to execute, deliver
or perform any of its obligations under this Agreement or to perform its
obligations in accordance with the terms hereof. The purchase and acquisition
of the Securities by the Subscriber do not violate any law, rule, regulation,
order, judgment or decree applicable to the Company, or, require further
filing by the Company or Subscriber under such law, rule, regulation, order,
judgment or decree, by virtue of the Company's business or assets. Except as
set forth in the Memorandum, the Company is not in violation of the listing
requirements of Nasdaq and does not reasonably anticipate that the ADSs will
be de-listed by Nasdaq for the foreseeable future, and the Company has made
all necessary filings and notifications with, and obtained all necessary
approvals from, Nasdaq with respect to the transactions contemplated hereby,
including, without limitation, the issuance of the Shares and the Warrant
Shares and the inclusion for quotation of the Shares and the Warrant Shares
on Nasdaq.
4.7 The Ordinary Shares are registered under Section 12 of the
Securities and Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and have
been so registered since November 13, 1995. Since December 31, 1996, the Company
has timely filed all reports, schedules, forms, statements and other documents
required to be filed by it with Companies House pursuant to the United Kingdom
Companies Xxx 0000 (collectively, and in each case including all exhibits and
schedules thereto and documents incorporated by reference therein, the "COMPANY
REPORTS") and 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 (all of the foregoing filed after
December 31, 1996, and all exhibits included therein and financial statements
and schedules thereto and documents incorporated by reference therein, being
referred to herein as the "SEC DOCUMENTS" and such documents filed prior to the
date hereof, the "FILED SEC DOCUMENTS"), including for purposes of determining
the availability of Form S-3. The Company has delivered or made available to
Subscriber true and complete copies of the SEC Documents filed since December
31, 1996. As of their respective dates of filing, the Company Reports and the
SEC Documents complied in all material respects with the requirements of the
applicable law and the rules and regulations promulgated thereunder applicable
to such Company Reports and SEC Documents, and none of the Company Reports and
SEC Documents, at the time they were filed with the Companies House or SEC,
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 on SCHEDULE 4.7, none of the statements made in
any such SEC Document is, or, except pursuant to Filed SEC Documents has been,
required to be updated or amended under applicable law. Except as set forth on
SCHEDULE 4.7, the financial statements of the Company included in the SEC
Documents were prepared in accordance with United States of America generally
accepted accounting principles, consistently applied, and the rules and
regulations of the SEC 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 do not include
footnotes or are condensed or summary statements) and present accurately and
completely in all material respects the consolidated financial position of the
Company and its consolidated subsidiaries as of the dates thereof and the
consolidated results of their operations and cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, immaterial
year-end audit adjustments). Except as set forth in the financial statements of
the Company included in the Filed SEC Documents, the Company has no liabilities,
contingent or otherwise, other than (i) liabilities incurred subsequent to the
date of such financial statements in the ordinary course of business consistent
with past practice and (ii) obligations under contracts and commitments incurred
in the ordinary course of business and not required under generally accepted
accounting principles to be reflected in such financial statements. The Filed
SEC Documents contain a complete and accurate list of all material undischarged
written or oral contracts, agreements, leases or other instruments to which the
Company or any subsidiary is a party or by which the Company or any subsidiary
is bound or to which any of the properties or assets of the Company or any
subsidiary is subject (each a "CONTRACT"), except to the extent not required to
be filed pursuant to the applicable
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Rules and Regulations of the SEC. None of the Company, its subsidiaries or
any of the other parties thereto, is in material breach or violation of any
Contract. No event, occurrence or condition exists which, with the lapse of
time, the giving of notice, or both, or the happening of any further event or
condition, would become a material breach or default by the Company or its
subsidiaries under any Contract.
4.8 Except as set forth in the Public Reports, since December 31, 1999,
there has been no material adverse change and no material adverse development in
the business, properties, operations, financial condition, results of operations
or prospects of the Company or any of its subsidiaries.
4.9 Except as set forth in the Filed SEC Documents and the Memorandum,
there is no action, suit, proceeding, inquiry or investigation before or by any
court, public board, governmental agency or authority, or self-regulatory
organization or body pending or threatened against or affecting the Company, any
of its subsidiaries, or any of their respective directors or officers in their
capacities as such, wherein an unfavorable decision, ruling or finding (i) would
adversely affect the transactions contemplated by this Agreement or any of the
documents contemplated hereby, (ii) would adversely affect the validity or
enforceability of, or the authority or ability of the Company to perform its
obligations under, this Agreement or any of such other documents or (iii) would
adversely affect the business properties, operations and results of operations
or prospects of the Company or any of its subsidiaries. There are no facts
which, if known by a potential claimant or governmental agency or authority,
could give rise to a claim or proceeding.
4.10 No information relating to or concerning the Company or any of its
subsidiaries set forth in this Agreement or in the Memorandum contains an 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 light of the
circumstances under which they were made, not misleading. Except for the
execution and performance of this Agreement and the transactions contemplated
hereby, no material fact (within the meaning of the federal securities laws of
the United States of America) exists with respect to the Company or any of its
subsidiaries which has not been publicly disclosed, except to the extent not
required to be disclosed pursuant to the applicable Rules and Regulations of the
SEC.
4.11 The Company acknowledges and agrees that Subscriber is acting
independently and is not acting as a financial advisor or fiduciary of the
Company (or in any similar capacity) with respect to this Agreement or the
transactions contemplated hereby, that this Agreement and the transactions
contemplated hereby, and the relationship between Subscriber and the Company,
are "arm's-length", and that any statement made by Subscriber, or any of its
representatives or agents, in connection with this Agreement or the transactions
contemplated hereby is not advice or a recommendation, is merely incidental to
Subscriber's purchase of the Securities and has not been relied upon in any way
by the Company, its officers, directors or other representatives. The Company
further represents to Subscriber that the Company's decision to enter into this
Agreement and the transactions contemplated hereby has been based solely on an
independent evaluation by the Company and its representatives.
4.12 The Company is currently eligible to register the resale of the
Shares and the Warrant Shares by the Subscriber in a secondary offering under
General Instruction B3 and B4 of Form S-3 on a registration statement on Form
S-3 under the Securities Act.
4.13 Neither the Company nor any person acting on behalf of the Company
has conducted any "general solicitation," as described in Rule 502(c) under
Regulation D promulgated under the Securities Act ("REGULATION D"), with respect
to any of the Securities being offered hereby.
4.14 Neither the Company, nor any of its affiliates, nor any person
acting on their behalf, has directly or indirectly made any offers or sales of
any security or solicited any offers to buy any security under circumstances
that would prevent the parties hereto from consummating the transactions
contemplated hereby pursuant to an exemption from registration under the
Securities Act pursuant to the provisions of Regulation D. The transactions
contemplated hereby are exempt from the registration requirements of the
Securities Act, assuming the accuracy of the representations and warranties
herein contained of Subscriber to the extent relevant for such determination.
The issuance of the Securities to the Subscriber will not be integrated with any
other issuance of the Company's securities (past, current or future) which
requires shareholder approval under the rules of Nasdaq or which would result in
a violation of the Securities Act. The issuance of the Securities to the
Subscriber does not require shareholder approval, including, without limitation,
pursuant to the rules of Nasdaq.
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4.15 The Company has taken no action which would give rise to any claim
by any person for brokerage commissions, finder's fees or similar payments by
Subscriber relating to this Agreement or the transactions contemplated hereby,
except for dealings with the Placement Agent (the fees of which shall be borne
solely by the Company).
4.16 The Company's executive officers and directors have studied and
fully understand the terms of this Agreement and the transactions contemplated
hereby and the nature of the securities being sold hereunder and recognize that
they have a potentially dilutive effect. The board of directors of the Company
has concluded in its good faith business judgment that the issuance of the
Securities as contemplated hereby is in the best interests of the Company.
4.17 Each of the Company and its subsidiaries owns or possesses
adequate and enforceable rights to use all patents, patent applications,
trademarks, trademark applications, trade names, service marks, copyrights,
copyright applications, licenses, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures) and other similar rights and proprietary knowledge (collectively,
"INTANGIBLES") used or necessary to conduct its business as now being conducted
and as previously described in the Form 10-K and any subsequently filed reports
on Form 10-Q and Form 8-K. Except as set forth in the Memorandum, to their
respective knowledge, neither the Company nor any subsidiary of the Company
infringes on or is in conflict with any right of any other person with respect
to any Intangibles nor is there any claim of infringement made or threatened by
a third party against or involving the Company or any of its subsidiaries.
4.18 Neither the Company, nor any of its subsidiaries, nor any
director, officer, agent, employee or other person acting on behalf of the
Company or any subsidiary, has, in the course of his actions for, or on behalf
of, the Company, (i) used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expenses relating to political activity,
(ii) made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds, (iii) violated or is in
violation of any provision of the United States Foreign Corrupt Practices Act of
1977, as amended or (iv) made any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment to any foreign or domestic government
official or employee. Without limiting the generality of the foregoing, the
Company and its subsidiaries have not directly or indirectly made or agreed to
make (whether or not said payment is lawful) any payment to obtain, or with
respect to, sales other than usual and regular compensation to its or their
employees and sales representatives with respect to such sales.
4.19 Except for employees who perform purely administrative or
custodial functions, each employee of the Company has executed an agreement
containing non-disclosure, confidentiality and assignment of Intangibles
provisions. Each Key Employee (as defined below) is currently serving the
Company in the capacity disclosed in SCHEDULE 4.19. Except for employees who
perform purely administrative or custodial functions, no employee of the Company
or its subsidiaries is now, or is expected to be, in violation of any material
term of any employment contract, confidentiality, disclosure or proprietary
information agreement, non-competition agreement, or any other contract or
agreement or any restrictive covenant, and the continued employment of each
employee does not subject the Company or any of its subsidiaries to any
liability with respect to any of the foregoing matters. Except for employees who
perform purely administrative or custodial functions, no employee has any
intention to terminate or limit his employment with, or services to, the Company
or any of its subsidiaries, nor is any such employee subject to any constraints
(E.G., litigation) which would cause such employee to be unable to devote his
full time and attention to such employment or services. "KEY EMPLOYEES" means
Xxxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxxx, Xxxx X. XxXxxxxx, Xxxxxx Xxxxxx, Xxxxxxxx
Xxxxxx, Xxxxxx X. Xxxxxxx, and Xxxxxxx Xxxx and any individual who assumes or
performs any of the duties of a Key Employee.
4.20 The Company is not a Passive Foreign Investment Company ("PFIC")
within the meaning of Section 1297 of the United States Internal Revenue Code of
1986, as amended, and is not likely to become a PFIC.
4.21 The Company is not and, after giving effect to the Offering and
sale of the Securities, will not be an "investment company," as such term is
defined in the Investment Company Act of 1940, as amended.
4.22 The Deposit Agreement has been duly authorized, executed and
delivered by the Company, and constitutes a valid and legally binding agreement
of the Company, enforceable in accordance with its terms. Upon issuance by the
Depositary of the ADRs evidencing ADSs against deposit of the Shares and the
Warrant Shares in
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respect thereof in accordance with the provisions of the Deposit Agreement,
such ADRs will be duly and validly issued and the persons in whose names the
ADRs are registered will be entitled to the rights specified therein and in
the Deposit Agreement.
4.23 All dividends and other distributions declared and payable on the
shares of the capital stock of the Company may, under the current laws and
regulations of the United Kingdom, be paid to the Depositary in British Pound
Sterling that may be converted into foreign currency that may be freely
transferred out of the United Kingdom and all such dividends and other
distributions will not be subject to withholding or other taxes under the laws
and regulations of the United Kingdom and are otherwise free and clear of any
other tax, withholding or deduction in the United Kingdom and without the
necessity of obtaining any authorization in the United Kingdom.
4.24 Except for taxes and duties to be paid by the Company, no stamp or
other issuance of transfer taxes or duties and no capital gains, income,
withholding or other taxes are payable by or on behalf of the Subscriber to the
United Kingdom or any political subdivision or taxing authority thereof or
therein in connection with (i) the deposit with the Depositary of the Shares and
the Warrant Shares by the Company against the issuance of the ADRs evidencing
ADSs or (ii) the sale and delivery by the Company of the Shares, the Warrant
Shares and ADSs to or for the account of the Subscriber.
4.25 Neither the Company nor any of its subsidiaries has taken,
directly or indirectly any action which was designed to or which has constituted
or which might reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities and ADSs.
4.26 The Company has obtained lock-up agreements in the form set forth
in EXHIBIT B hereto from each of Xxxxxxx X. Xxxxxx, Xxxxxxx X. Xxxxxx, Xxxxxx
Xxxxxx, Xxxxx Xxx Xxxxxx, Xxxx X. XxXxxxxx, Xxxxxx X. Xxxxxxx, Xxxxxxx Xxxx,
Xxxxxxxx Viscount Bearsted, Xxxxx X. Xxxxxxxx, Xxxxxxx X. Xxxx and Xxxxxx X.
Xxxxx not to sell, offer to sell, contract to sell, hypothecate, grant any
option to sell or otherwise dispose of, directly or indirectly, any ADSs, ADRs,
Ordinary Shares or securities convertible into or unexchangeable or exercisable
for ADSs, ADRs or Ordinary Shares or warrants or other rights to purchase ADSs,
ADRs or Ordinary Shares for a period beginning on November 24, 2000 and ending
on 180 days from November 24, 2000.
4.27 Except as set forth in the financial statements included in the
Filed SEC Documents, each of the Company and its subsidiaries have timely filed
all requisite United States of America federal, state and other tax returns or
extension requests for all fiscal periods in which such filings were required to
be made. There are no examinations in progress or claims pending against the
Company or any of its subsidiaries for United States of America federal, state
and other taxes (including penalties and interest) for any period or periods
prior to and including December 31, 1999 and no notice of any claim for taxes,
whether pending or threatened, has been received. All taxes due from the Company
and its subsidiaries for any period ended before the date hereof, including
interest and penalties (whether or not shown on any tax return) has been paid.
The amounts shown as accruals for taxes on the financial statements included in
the Filed SEC Documents are sufficient for the payment of all taxes (including
penalties and interest) for all periods ended on or before that date. The
Company and its subsidiaries are not and have not during the last five (5) years
been a party to any tax sharing agreement or agreement of similar effect. The
Company is not and has not during the last five (5) years been a member of any
consolidated group. Except as set forth in the financial statements included in
the Filed SEC Documents, the Company and the subsidiaries have not received,
been denied, or applied for any private letter ruling during the last five (5)
years.
4.28 The Company and its subsidiaries have all Permits (as
hereinafter defined) required by law or governmental regulations from all
applicable courts, administrative agencies or commissions or other
governmental authorities or instrumentalities, whether in the United States
of America (federal, state or local) or outside of the United States of
America that are necessary to operate such businesses as presently conducted
and all such Permits are in full force and effect, except where the failure
to have any such Permits in full force and effect could not, individually or
in the aggregate, reasonably be expected to have a material adverse effect on
the business, properties, operations and results of operations or prospects
of the Company or any of its subsidiaries. Neither the Company nor any of its
subsidiaries is in default under, or in violation of or noncompliance with,
any of such Permits, except for any such default, violation of or
noncompliance which could not, individually or in the aggregate, reasonably
be expected to have a material adverse effect on the business, properties,
operations and results of operations or
8
prospects of the Company or any of its subsidiaries. Upon consummation of the
transactions contemplated by this Agreement, each such Permit will remain in
full force and effect and will not create a right of any other person to
terminate or revoke, modify or condition such Permit based on such
consummation. "Permit" means any permit, certificate, consent, approval,
authorization, order, license, variance, franchise or other similar indicia
of authority issued or granted by any court, administrative agency or
commission or other governmental authority or instrumentality, whether in the
United States of America (federal, state or local) or outside of the United
States of America.
4.29 No Subscriber is subscribing for any securities of the Company on
the Closing Date with terms and conditions different from the terms and
conditions of this Agreement.
4.30 The Company agrees to file a Form 8-K disclosing this Agreement
and the transactions contemplated hereby with the SEC within three (3) business
days following the Closing Date. Such Form 8-K shall contain as an exhibit this
Agreement and the Warrants. Without limiting any of the Company's obligations
under this Agreement, from and after the Closing Date, neither the Company nor
any person acting on its behalf shall take any action which would adversely
affect any exemptions from registration under the Securities Act with respect to
the transactions contemplated hereby.
4.31 So long as the Subscriber remains a registered owner of any of the
Securities, the Company shall timely file all reports required to be filed with
the SEC pursuant to the Exchange Act, and the Company shall not terminate its
status as an issuer required to file reports under the Exchange Act even if the
Exchange Act or the rules and regulations thereunder would permit such
termination.
4.32 For a period of beginning on the Closing Date and ending on the
third (3rd) anniversary of the Closing Date, the Company shall continue the
listing and trading of its ADSs on Nasdaq, the New York Stock Exchange or the
American Stock Exchange, secure and maintain the listing and trading of the
Shares and the Warrant Shares on such exchange or quotation system, and comply
in all respects with the Company's reporting, filing and other obligations under
the by-laws or rules of such exchange or quotation system.
4.33 The Company shall file a Form D within 15 days of the Closing Date
with respect to the Securities with the SEC as required under Regulation D under
the Securities Act, and shall provide a copy thereof to the Subscriber.
4.34 The Company agrees to provide the following reports to the
Subscriber until the earlier of (i) the date on which the Subscriber transfers
to a non-affiliate of such Subscriber, assigns or sells all of its Securities or
(ii) the third (3rd) anniversary of the Closing Date: (a) a copy of its Annual
Report on Form 10-K within 90 days of the end of the Company's fiscal year, its
Quarterly Reports on Form 10-Q within 45 days of the end of each fiscal quarter,
any proxy statements and any Current Reports on Form 8-K as each becomes
available and (b) within two (2) days after release, copies of all press
releases issued by the Company or any of its subsidiaries. The Company further
agrees to promptly provide to the Subscriber any information with respect to the
Company, its properties, or its business or the Subscriber's investment as the
Subscriber may reasonably request; PROVIDED, HOWEVER, that the Company shall not
be required to provide the Subscriber any material nonpublic information.
5. TRANSFER RESTRICTIONS AND REGISTRATION RIGHTS.
5.1 Subscriber acknowledges that it is acquiring the Securities for its
own account and for the purpose of investment and not with a view to any
distribution or resale thereof within the meaning of the Securities Act and any
applicable state or other securities laws ("STATE ACTS"). The Subscriber further
agrees that it will not sell, assign or transfer the Securities at any time in
violation of the Securities Act or State Acts and acknowledges that, in
acquiring Restricted Securities (as such term is defined under the Securities
Act), it must continue to bear the economic risk of its investment for an
indefinite period of time because of the fact that the Securities have not been
registered under the Securities Act or State Acts, and further acknowledges that
the Securities may not be sold unless subsequently registered under the
Securities Act and State Acts or an exemption from such registration is
available. The Subscriber further acknowledges that the Company is not assuming
any obligation to register the Securities under the Securities Act or State Acts
except as expressly set forth herein. The Subscriber also acknowledges that
appropriate legends reflecting the status of the Securities under the Securities
Act and State Acts
9
may be placed on the certificates representing such Securities at the time of
their transfer and delivery to the holder thereof.
5.2 Except as provided hereafter with respect to registration of the
Shares and the Warrant Shares, it shall be a condition to any such transfer that
the Company shall be furnished with an opinion of counsel from the holder of
such Shares and Warrant Shares, reasonably satisfactory to the Company, to the
effect that the proposed transfer would be in compliance with the Securities Act
and State Acts.
5.3 (a) Within ten (10) days after the Closing Date, the Company shall
use its best efforts to prepare and file with the SEC on one occasion, a
registration statement and such other documents as may be necessary in the
opinion of counsel for the Company, and use its best efforts to have such
registration statement declared effective as soon as possible after the Closing
Date in order to comply with the provisions of the Securities Act so as to
permit the registered resale of the Shares and the Warrant Shares for a period
of three (3) years following the Closing Date by each and every holder of shares
sold in the Offering (the "OFFERING SHARES") who desires to register the resale
of their shares. Within five (5) days after the Closing Date, the Company shall
give each holder of Offering Shares notice at the address of such holder
appearing on the register and transfer records of Company of the Company's
intention to register the resale of such Offering Shares. The obligations of the
Company to give such notice shall be limited to the Subscriber and any entity
which at the time the Offering Shares may have been transferred, which entities,
together with the Subscriber and the Placement Agent, are hereafter referred to
as "OFFERING HOLDERS."
(b) If the registration statement referred to in Section
5.3(a) above has not been declared effective by the SEC on or before May 14,
2001, the Company shall promptly issue to the Subscriber .07 ADS for every ADS
purchased in the Offering. In addition, if the registration statement referred
to in Section 5.3(a) is not declared effective by the SEC on or before the last
day of each month thereafter, the Company shall promptly, in each respective
month (and prorated for partial months), issue to the Subscriber .02 ADS for
every ADS purchased in the Offering until the registration statement is declared
effective by the SEC (rounded up to the nearest share after aggregating all
shares held by such Offering Holder). In the event of an issue of further ADSs
pursuant to this Section 5.3(b), the Subscriber shall pay the nominal value of
each Ordinary Share represented by each ADS it receives. The foregoing payment
shall constitute the sole monetary remedy available to the Subscriber in the
event that the Company does not comply with the deadlines set forth in this
Section 5.3(b) with respect to the effectiveness of the registration statement
referred to therein.
5.4 Notwithstanding the foregoing provisions of this Section 5, the
Company may voluntarily suspend the effectiveness of any such registration
statement for a limited time, which in no event shall be longer than 60
consecutive or non-consecutive days in any 12-month period, if the Company has
been advised in writing by counsel or underwriters to the Company that the
offering of any Offering Shares pursuant to the registration statement would
materially adversely affect, or would be improper in view of (or improper
without disclosure in a prospectus), a proposed financing, a reorganization,
recapitalization, merger, consolidation, or similar transaction involving the
Company. If any event occurs that would cause the registration statement to
contain a material misstatement or omission or not to be effective and usable
during the period that such registration statement is required to be effective
and usable, the Company shall promptly file an amendment to the registration
statement and use its best efforts to cause such amendment to be declared
effective as soon as practicable thereafter. The Offering Holders shall furnish
to the Company such information regarding their holdings and the proposed manner
of distribution thereof as the Company may reasonably request and as shall be
required in connection with any such registration statement. Notwithstanding any
provision contained herein to the contrary, the Company's obligation to include,
or continue to include, Offering Shares in any such registration statement under
this Section 5 shall terminate to the extent such shares are eligible for resale
under Rule 144(k) promulgated under the Securities Act. If the registration
statement registering the Shares and the Warrant Shares for resale is suspended
more than 60 consecutive or non-consecutive days in any 12-month period, the
Company shall promptly issue to the Subscriber .07 ADS for every ADS purchased
in the Offering. In addition, if such suspension or stop order is not lifted on
or before the last day of each month thereafter, the Company shall promptly, in
each respective month (and prorated for partial months), issue to the Subscriber
.02 ADS for every ADS purchased in the Offering until the registration statement
is declared effective by the SEC (rounded up to the nearest share after
aggregating all shares held by such Offering Holder). In the event of an issue
of further ADSs pursuant to this Section 5.4, the Subscriber shall pay the
nominal value of each Ordinary Share represented by each ADS it receives.
10
5.5 If and whenever the Company is required by the provisions of this
Agreement to use its best efforts to effect the registration of the Offering
Shares under the Securities Act for the account of an Offering Holder, the
Company will, as promptly as possible:
(a) prepare and file with the SEC a registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective;
(b) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and
to comply with the requirements of the Securities Act and the rules and
regulations promulgated by the SEC thereunder relating to the sale or other
disposition of the securities covered by such registration statement;
(c) furnish to each Offering Holder such numbers of copies of
a prospectus complying with the requirements of the Securities Act, and such
other documents as such Offering Holder may reasonably request in order to
facilitate the public sale or other disposition of the Offering Shares owned by
such Offering Holder, but such Offering Holder shall not be entitled to use any
selling materials other than a prospectus;
(d) use its best efforts to register or qualify the securities
covered by such registration statement under the State Acts as any Offering
Holder shall reasonably request, and do any and all such other acts and things
as may be necessary or advisable to enable such Offering Holder to consummate
the public sale or other disposition of the Offering Shares owned by such
Offering Holder in such states; PROVIDED, HOWEVER, that the Company shall not be
obligated to register or qualify such securities in any jurisdiction in which
such registration or qualification would require the Company to qualify as a
foreign corporation or file any general consent to service of process where it
is not then so qualified or has not theretofore so consented; and
(e) provide a transfer agent and Depositary, which may be a
single entity, for the Shares and the Warrant Shares not later than the
effective date of the applicable registration statement.
5.6 Except as provided below in this Section 5, the expenses incurred
by the Company in connection with action taken by the Company to comply with
this Section 5, including, without limitation, all registration and filing fees,
printing and delivery expenses, accounting fees, fees and disbursements of
counsel to the Company, consultant and expert fees, premiums for liability
insurance, if applicable, obtained in connection with a registration statement
filed to effect such compliance, if applicable, and all expenses, including
counsel fees, for complying with State Acts, shall be paid by the Company. All
fees and disbursements of any counsel, experts, or consultants employed by any
Offering Holder shall be borne by such Offering Holder. The Company shall not be
obligated in any way in connection with any registration pursuant to this
Section 5, for any selling commissions or discounts payable to any underwriter
or broker for securities to be sold by such Offering Holder. It shall be a
condition precedent to the obligation of the Company to take any action pursuant
to this Section 5 that the Company shall have received an undertaking
satisfactory to it from each Offering Holder to pay all expenses required to be
borne by such Offering Holder and to furnish or cause to be furnished to the
Company, specifically for use in the preparation of the registration statement
and prospectus, written information concerning (i) the securities held by such
Offering Holder and any underwriter of such securities, (ii) the intended method
of disposition thereof and (iii) any additional information or documentation as
the Company shall reasonably request and as may be required by administrators of
the Securities Act or State Acts in connection with the action to be taken by
the Company hereunder pursuant to such registration.
5.7 The Company will (to the extent it is lawful for it to do so)
indemnify and hold harmless each Offering Holder, its officers, directors and
each underwriter of such securities, and any person who controls such Offering
Holder or underwriter within the meaning of Section 15 of the Securities Act,
against all claims, actions, losses, damages, liabilities and expenses, joint or
several, to which any of such persons may become subject under the Securities
Act or otherwise, insofar as such losses, claims, damages, liabilities or
actions arise out of or are based upon (i) any untrue statement of any material
fact contained in any registration statement under which such securities were
registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereof, or arise
out of or are based upon the omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading;
(ii) any violation of United States of America state or federal securities laws
but only to the extent, with respect to this subsection (ii),
11
that the Offering Holder suffers losses, damages and liabilities with respect
to the Securities such Offering Holder beneficially owns as of the date of
such violation including any Securities sold on the day of such violation;
(iii) any failure by the Company to fulfill and perform any agreement,
covenant or undertaking herein or (iv) any failure or breach of the
representations and warranties of the Company set forth in Section 4 to be
accurate as of the Closing, and will (to the extent it is lawful for it to do
so) promptly reimburse such Offering Holder, its officers, directors and each
underwriter of such securities, and each such controlling person or entity
for any legal and any other expenses reasonably incurred by such Offering
Holder, such underwriter, or such controlling person or entity in connection
with investigating or defending any such loss, action, claim, damage,
liability or action; PROVIDED, HOWEVER, that the Company will not be liable
in any such case to the extent that any such loss, claim, damage, liability
or action arises directly out of or is based primarily upon an untrue
statement or omission made in said registration statement, said preliminary
prospectus or said prospectus, or said amendment or supplement in reliance
upon and in conformity with written information furnished to the Company by
such Offering Holder or such underwriter specifically for use in the
preparation thereof, and PROVIDED FURTHER, HOWEVER, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability or action arises directly out of or is based primarily upon an
untrue statement or omission made in any preliminary prospectus or final
prospectus if (i) such Offering Holder failed to send or deliver a copy of
the final prospectus or prospectus supplement with or prior to the delivery
of written confirmation of the sale of the Offering Shares and (ii) the final
prospectus or prospectus supplement would have corrected such untrue
statement or omission.
5.8 In the event of any registration of any securities under the
Securities Act pursuant to this Section 5, each Offering Holder will (to the
extent it is lawful to do so), or will furnish the written undertaking of such
other person or entity as shall be acceptable to the Company to, indemnify and
hold harmless the Company, its officers, directors and any person who controls
the Company within the meaning of Section 15 of the Securities Act, against any
losses, claims, damages, liabilities, or actions, joint or several, to which the
Company, its officers, directors, or such controlling person or entity may
become subject under the Securities Act or otherwise, insofar as such losses,
claims, damages, liabilities, or actions arise out of or are based upon any
untrue statement of any material fact contained in any registration statement
under which such securities were registered under the Securities Act, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereto, or arise out of or are based upon the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent and only to the
extent that any such loss, claim, damage, liability, or action arises out of or
is based upon an untrue statement or omission made in said registration
statement, said preliminary prospectus or said prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by such Offering Holder or any underwriter of such Offering
Holder's securities specifically for use in the preparation thereof, and will
(to the extent it is lawful to do so) promptly reimburse the Company, its
officers, directors and any person who controls the Company within the meaning
of Section 15 of the Securities Act in connection with investigating or
defending any such loss, action, claim, damage, liability or action; PROVIDED,
HOWEVER, that the aggregate amount which any such Offering Holder shall be
required to pay pursuant to this Section 5.8 shall be limited to the dollar
amount of the net proceeds received by such Offering Holder upon the sale of the
Securities pursuant to the registration statement giving rise to such claim.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company, its officers, directors and
any person who controls the Company within the meaning of Section 15 of the
Securities Act, and shall survive the transfer of the Securities by such
Offering Holder.
5.9 At any time when a prospectus relating to the Offering is required
to be delivered under the Securities Act, the Company will promptly notify the
Offering Holder of the happening of any event, upon the notification or
awareness of such event by an executive officer of the Company, as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of material fact or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing.
5.10 Any party entitled to indemnification hereunder will (i) give
prompt written notice to the indemnifying party of any claim with respect to
which it seeks indemnification and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without its consent (which consent may not be
12
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
5.11 With a view to making available to the Offering Holder the
benefits of Rule 144 promulgated under the Securities Act, the Company agrees
that it will use its best efforts to maintain registration of its Ordinary
Shares represented by ADSs under Section 12 or 15 of the Exchange Act and to
file with the SEC in a timely manner all reports and other documents required to
be filed by an issuer of securities registered under the Exchange Act so as to
maintain the availability of Rule 144 promulgated under the Securities Act. Upon
the request of any record owner, the Company will deliver to such owner a
written statement as to whether it has complied with the reporting requirements
of Rule 144 promulgated under the Securities Act.
6. SUBSCRIBER REPRESENTATIONS. The undersigned Subscriber hereby
represents, warrants and acknowledges and agrees with the Company and the
Placement Agent as follows:
6.1 The undersigned has been furnished with and has carefully read the
Memorandum and is familiar with and understands the terms of the offering
described in the Memorandum (the "OFFERING").
6.2 The undersigned and/or the undersigned's advisor(s) has/have had a
reasonable opportunity to ask questions of and receive answers from a person or
persons acting on behalf of the Company concerning the Offering and all such
questions have been answered to the full satisfaction of the undersigned.
6.3 The undersigned is not subscribing for the Securities as a result
of or subsequent to any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media or broadcast over
television or radio or presented at any seminar or meeting.
6.4 The undersigned is an "accredited investor" within the meaning of
Rule 501(a) of Regulation D under the Securities Act.
6.5 The undersigned acknowledges that the Securities herein subscribed
for have not been registered under the Securities Act and State Acts. The
undersigned will not sell, transfer or otherwise dispose of the Securities,
unless they are registered under the Securities Act and any State Acts or
pursuant to available exemptions from such registration, provided that the
seller delivers to the Company an opinion of counsel satisfactory to the Company
confirming the availability of such exemption. The undersigned represents that
the undersigned is purchasing the Securities for the undersigned's own account,
for investment and not with a view to resale or distribution except in
compliance with the Securities Act and the restrictions contained in the
immediately preceding sentence. The undersigned has not offered or sold any
portion of the Securities being acquired, nor does the undersigned have any
present intention of selling, distributing or otherwise disposing of the
Securities, either currently or after the passage of a fixed or determinable
period of time or upon the occurrence or nonoccurrence of any predetermined
event or circumstance, in violation of the Securities Act.
6.6 The undersigned recognizes that investment in the Securities
involves substantial risks, including loss of the entire amount of such
investment. Further, the undersigned has carefully read and considered the
matters set forth in the Memorandum under the caption "Risk Factors" and has
taken full cognizance of and understands all of the risks related to a purchase
of the Securities.
6.7 The undersigned acknowledges that each certificate representing the
Securities shall be stamped or otherwise imprinted with a legend substantially
in the following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "SECURITIES ACT") OR UNDER APPLICABLE STATE
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF
13
UNLESS REGISTERED UNDER THE SECURITIES ACT AND ANY APPLICABLE
STATE SECURITIES LAWS OR PURSUANT TO AVAILABLE EXEMPTIONS FROM
SUCH REGISTRATION.
6.8 If this Subscription Agreement is executed and delivered on behalf
of a partnership, corporation, trust or estate: (i) such partnership,
corporation, trust or estate has the full legal right and power and all
authority and approval required (a) to execute and deliver, or authorize
execution and delivery of, this Subscription Agreement and all other instruments
executed and delivered by or on behalf of such partnership, corporation, trust
or estate in connection with the purchase of the Securities, (b) to delegate
authority pursuant to a power of attorney and (c) to purchase and hold such
Securities; (ii) the signature of the party signing on behalf of such
partnership, corporation, trust or estate is binding upon such partnership,
corporation, trust or estate; and (iii) such partnership, corporation or trust
has not been formed for the specific purpose of acquiring the Securities, unless
each beneficial owner of such entity is qualified as an "accredited investor"
within the meaning of Rule 501(a) of Regulation D under the Securities Act and
has submitted information substantiating such individual qualification.
6.9 Except with respect to short sales or other hedging transactions
against warrants, options or other rights to acquire ADSs and Ordinary Shares
beneficially owned by the undersigned (whether presently exercisable or not) at
September 30, 2000, the undersigned agrees that for a period beginning from the
Closing Date and ending on the earlier of (i) 90 days from the Closing Date and
(ii) the day the registration statement filed pursuant to Section 5 hereof is
declared effective, the undersigned will not sell any equity security of the
Company if the undersigned does not then own the security sold, nor will the
undersigned sell any security which the undersigned does not deliver against
such sale within 20 days, or within five (5) days after such sale, deposit it in
the mails or other usual channels of distribution.
7. UNDERSTANDINGS.
The undersigned Subscriber understands, acknowledges and agrees with
the Company and the Placement Agent as follows:
7.1 This Subscription may be rejected, in whole or in part, by the
Company, in its sole and absolute discretion, at any time before the Closing
Date notwithstanding prior receipt by the undersigned of notice of acceptance of
the undersigned's Subscription.
7.2 Except as set forth in paragraph 7.1 above, the undersigned hereby
acknowledges and agrees that the Subscription hereunder is irrevocable by the
undersigned, that, except as required by law, the undersigned is not entitled to
cancel, terminate or revoke this Subscription Agreement or any agreements of the
undersigned hereunder and that this Subscription Agreement and such other
agreements shall survive the death or disability of the undersigned and shall be
binding upon and inure to the benefit of the parties and their heirs, executors,
administrators, successors, legal representatives and permitted assigns. If the
undersigned is more than one person, the obligations of the undersigned
hereunder shall be joint and several and the agreements, representations,
warranties and acknowledgments herein contained shall be deemed to be made by
and be binding upon each such person and his/her heirs, executors,
administrators, successors, legal representatives and permitted assigns.
7.3 No United States of America federal or state agency or foreign
authority has made any findings or determination as to the fairness of the terms
of this Offering for investment nor any recommendations or endorsement of the
Securities.
7.4 The Offering is intended to be exempt from registration under the
Securities Act by virtue of Section 4(2) of the Securities Act and the
provisions of Regulation D thereunder, which is in part dependent upon the
truth, completeness and accuracy of the statements made by the undersigned
herein and in the Investor Questionnaire.
7.5 There can be no assurance that the undersigned will be able to sell
or dispose of the Securities. It is understood that in order not to jeopardize
the Offering's exempt status under Section 4(2) of the Securities Act and
Regulation D, any transferee may, at a minimum, be required to fulfill the
investor suitability requirements thereunder.
14
7.6 The Placement Agent will receive cash compensation equal to (i) six
percent (6%) of the gross proceeds received by the Company and (ii) five-year
warrants to subscribe for 12,500 ADSs for every $1.0 million of gross proceeds
received by the Company in connection with the Offering but is not guaranteeing
or assuming responsibility for the operation or possible liability of the
Company, including, without limitation, compliance by the Company with the
agreements entered into in connection with the Offering, and the Placement Agent
will not supervise or participate in the operation or management of the Company.
7.7 The undersigned acknowledges that the information furnished by the
Company or the Placement Agent to the undersigned or its advisers in connection
with the Offering is confidential and nonpublic and agrees that all such
information shall be kept in confidence by the undersigned and neither used by
the undersigned for the undersigned's personal benefit (other than in connection
with this Subscription), nor disclosed to any third party for any reason;
PROVIDED, HOWEVER, that this obligation shall not apply to any such information
that (i) is part of the public knowledge or literature and readily accessible as
of date hereof, (ii) becomes a part of the public knowledge or literature and
readily accessible by publication (except as a result of a breach of this
provision) or (iii) is received from third parties (except third parties who
disclose such information in violation of any confidentiality agreements or
obligations, including, without limitation, any Subscription Agreement entered
into with the Company).
7.8 The representations, warranties and agreements of the undersigned
contained herein and in any other writing delivered in connection with the
transactions contemplated hereby shall be true and correct in all respects on
and as of the date of the sale of the Securities as if made on and as of such
date and shall survive the execution and delivery of this Subscription Agreement
and the purchase of the Securities.
7.9 IN MAKING AN INVESTMENT DECISION, SUBSCRIBERS MUST RELY ON THEIR
OWN EXAMINATION OF THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE
MERITS AND RISKS INVOLVED. THE ADSs HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR
STATE SECURITIES COMMISSION ON REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THE
MEMORANDUM OR THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
7.10 The offering and sale of the Securities is intended to be exempt
from registration under the securities laws of certain states of the United
States of America. Subscribers residing in the United States shall note the
language set forth below. Subscribers must note that there are restrictions on
transfer of the Securities.
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE
SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE
ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND SUCH LAWS. THE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION
OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING
AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE
ACCURACY OR ADEQUACY OF THE MEMORANDUM. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER
THE SECURITIES ACT, AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT
THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR
AN INDEFINITE PERIOD OF TIME.
8. MISCELLANEOUS.
8.1 Except as set forth elsewhere herein, any notice or demand to be
given or served in connection herewith shall be deemed to be sufficiently given
or served for all purposes by being sent as registered or certified
15
mail, return receipt requested, postage prepaid, in the case of the Company,
addressed to it at the address set forth above and directed to the following:
Attention: Xx. Xxxxxxx X. Xxxxxx
President and Chief Executive Officer
Insignia Solutions plc
00000 Xxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000-0000
Fax No. (000) 000-0000
and in the case of Subscriber to the address for correspondence set forth on the
Investor Questionnaire.
8.2 This Subscription Agreement shall be enforced, governed and
construed in all respects in accordance with the laws of the State of New York,
as such laws are applied by New York courts to agreements entered into and to be
performed in New York by and between residents of New York, and shall be binding
upon the undersigned, the undersigned's heirs, estate, legal representatives,
successors and assigns and shall inure to the benefit of the Company, the
Placement Agent, and their respective successors and assigns. If any provision
of this Subscription Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed to be modified to
conform with such statute or rule of law. Any provision hereof that may prove
invalid or unenforceable under any law shall not affect the validity or
enforceability of any other provision hereof.
8.3 Except as provided in Section 8.4, this Agreement shall be binding
upon and inure to the benefit of the Company and Subscriber and their respective
successors and assigns.
8.4 The rights provided under Section 5 are not assignable except to a
party who is defined in Section 5 as an "Offering Holder" or any lawful
purchaser of the Securities purchased hereby.
8.5 In any action, proceeding or counterclaim brought to enforce any of
the provisions of this Agreement or to recover damages, costs and expenses in
connection with any breach of the Agreement, the prevailing party shall be
entitled to be reimbursed by the opposing party for all of the prevailing
party's attorneys' fees, costs and other out-of-pocket expenses incurred in
connection with such action, proceeding or counterclaim.
8.6 Neither the Company nor the Subscriber shall issue any press
release or make any public announcement relating to this Agreement without the
prior written approval of the other party; PROVIDED, HOWEVER, that the Company
or the Subscriber may make any public disclosure it believes in good faith is
required by applicable law or any listing or trading agreement concerning its
publicly-trading securities, if any (in which case the disclosing party will
advise the party prior to making the disclosure); and, PROVIDED FURTHER,
HOWEVER, that this obligation shall not apply to any such information that (i)
is part of the public knowledge or literature and readily accessible as of date
hereof, (ii) becomes a part of the public knowledge or literature and readily
accessible by publication (except as a result of a breach of this provision) or
(iii) is received from third parties (except third parties who disclose such
information in violation of any confidentiality agreements or obligations,
including, without limitation, any Subscription Agreement entered into with the
Company).
8.7 This agreement is intended for the benefit of the parties hereto
and their respective permitted successors and assigns and not for the benefit
of, nor may any provision hereof be enforced by, any other person; PROVIDED,
HOWEVER, that notwithstanding the foregoing, the Placement Agreement may rely on
Sections 2, 3, 4, 5, 6, 7 and 8 as though it was a party to this Agreement.
16
SCHEDULE 4.4
(a) AUTHORIZED SHARE CAPITAL: L6,600,000 (30,000,000 Ordinary Shares of 20p
each and 3,000,000 Preferred Shares of 20p each)
(b) NUMBER OF ORDINARY SHARES ISSUED AND OUTSTANDING: 18,170,308
(c) NUMBER OF SHARES RESERVED FOR ISSUANCE PURSUANT TO STOCK OPTION PLANS AND
EMPLOYEE STOCK PURCHASE PLANS: 5,072,071 Ordinary Shares for 1995 Stock
Option Plan for U.S. Employees and U.K. Employee Share Option Scheme 1996;
900,000 Ordinary Shares for Employee Share Purchase Plan 1995.
(d) NUMBER OF SHARES RESERVED FOR ISSUANCE PURSUANT TO SECURITIES EXERCISABLE
FOR, CONVERTIBLE INTO OR EXCHANGEABLE FOR ANY SHARES: The Company must have
sufficient authorized and unissued share capital for the exercise of
Insignia Solutions plc ADSs Purchase Warrants (Initial Warrants and Reset
Warrants) dated December 9, 1999, pursuant to (a) the Securities Purchase
Agreement by and between the Company and Castle Creek Technology Partners
LLC, dated December 9, 1999; and (b) the Securities Purchase Agreement by
and between the Company and Xxxxxxx X. and Xxxxxxxx Xxxx, Xxxxxxx X. and
Xxxxxxx Xxxxxx, Xxxxxx Xxxxx-Xxxxx and Avalon Panama S.A., dated December
9, 1999. Currently, the Company has sufficient authorized and unissued
share capital to issue a total of 353,834 Ordinary Shares for the Initial
Warrants (as diluted by the private placement issuances on November 24,
2000) and 0 shares for the Reset Warrants under these two Securities
Purchase Agreements, but may in the future need to pass the necessary
shareholder resolutions increasing the authorized and unissued share
capital in respect of the Reset Warrants. The Company must also have
sufficient authorized and unissued share capital to issue (x) 1,800,000
Ordinary Shares for the Warrants issued pursuant to Subscription Agreements
by and between the Company and various investors dated November 24, 2000
and (y) 225,000 Ordinary Shares for the Warrants issued pursuant to the
Warrant Agreement by and between the Company and Jefferies & Company, Inc.,
dated November 24, 2000.
(e) NUMBER OF ORDINARY SHARES REPRESENTED BY ADSs: 17,295,575
(f) OUTSTANDING OPTIONS, WARRANTS, SCRIP, RIGHTS TO SUBSCRIBE FOR, CALLS OR
COMMITMENTS OF ANY CHARACTER WHATSOEVER RELATING TO, OR SECURITIES OR
RIGHTS CONVERTIBLE INTO OR EXERCISABLE OR EXCHANGEABLE FOR, ANY SHARES OF
THE COMPANY OR ANY OF ITS SUBSIDIARIES, OR CONTRACTS, COMMITMENTS,
UNDERSTANDINGS OR ARRANGEMENTS BY WHICH THE COMPANY OR ANY OF ITS
SUBSIDIARIES IS OR MAY BECOME BOUND TO ISSUE ADDITIONAL SHARES IN THE
COMPANY OR ANY OF ITS SUBSIDIARIES: Options outstanding: 3,343,630;
Warrants outstanding 2,378,834; Contracts by which the Company may become
bound to issue additional shares: (1) Securities Purchase Agreement by and
between the Company and Castle Creek Technology Partners LLC, dated
December 9, 1999. There are reset warrants issuable to Castle Creek to
subscribe for Ordinary Shares at nominal value (GBP 0.20) through
March 28, 2001 if the average 10 day closing bid price as quoted on the
Nasdaq Stock Market on certain dates is less than $4.23 - currently two
more possible reset occasions between now and March 28, 2001. The number of
Ordinary Shares that would be issuable under a reset warrant is calculated
based on the 10 day average closing bid price for that reset period; (2)
Securities Purchase Agreement by and between the Company and Xxxxxxx X. and
Xxxxxxxx Xxxx, Xxxxxxx X. and Xxxxxxx Xxxxxx, Xxxxxx Xxxxx-Xxxxx and Avalon
Panama S.A., dated December 9, 1999. There are reset warrants issuable to
these investors to subscribe for Ordinary Shares at nominal value (GBP
0.20) through March 28, 2001 if the average 10 day closing bid price as
quoted on the Nasdaq Stock Market on certain dates is less than $4.23 -
currently two more possible reset occasions between now and March 28, 2001.
The number of Ordinary Shares that would be issuable under a reset warrant
is calculated based on the 10 day average closing bid price for that reset
period; (3) Subscription Agreements by and between the Company and various
investors dated November 24, 2000. The Company may voluntarily suspend the
effectiveness of the registration statement covering the ADSs and the ADSs
underlying the warrants purchased in the November 2000 private placement
for up to a period of 60 days in any 12 month period. If the registration
statement is suspended for more than this period, the Company will be
required to issue to the various investors 0.07 ADS for every ADS purchased
in the November 2000 private placement, plus an additional 0.02 ADS for
every ADS purchased for every month the registration statement continues to
be suspended. In all such issuances of ADSs, the various investors will pay
the nominal value (GBP 0.20) of the Ordinary Shares represented by the ADS
received.
(g) AGREEMENTS OR ARRANGEMENTS UNDER WHICH THE COMPANY OR ANY OF ITS
SUBSIDIARIES IS OBLIGATED TO REGISTER THE SALE OF ANY OF ITS OR THEIR
SECURITIES UNDER THE SECURITIES ACT: Since January 1, 2000, Securities have
been registered pursuant to (a) Registration Rights Agreement by and
between the Company and Castle Creek Technology Partners LLC, dated
December 9, 1999; (b) Registration Rights Agreement by and between the
Company and Xxxxxxx X. and Xxxxxxxx Xxxx, Xxxxxxx X. and Xxxxxxx Xxxxxx,
Xxxxxx Xxxxx-Xxxxx and Avalon Panama S.A., dated December 9, 1999; (c)
Registration Rights under Subscription Agreements by and between the
Company and various investors dated November 24, 2000; and (d) Registration
Rights under Warrant Agreement by and between the Company and Xxxxxxxxx &
Company, Inc., dated November 24, 2000. Securities are in the process of
being registered pursuant to (x) Registration rights under Line of Credit
Agreement by and between Insignia Solutions plc and Xxxxxxx X. Xxxx,
Xxxxxxxx X. Xxxx, Xxxxxxx X. Xxxx and Xxxxxxx X. Xxxx, dated March 20, 2000
and (y) Registration Rights Agreement by and between the Company and
Quantum Corporation, dated October 20, 1999.
(h) ALL INSTRUMENTS AND AGREEMENTS (OTHER THAN THE MEMORANDUM OF ASSOCIATION
AND ARTICLES OF ASSOCIATION) GOVERNING SECURITIES CONVERTIBLE INTO OR
EXERCISABLE OR EXCHANGEABLE FOR THE ORDINARY SHARES (INCLUDING IN THE FORM
OF ADSS) OF THE COMPANY: (1) Insignia Solutions plc ADSs Purchase Warrants
(Initial Warrant and Reset Warrant) pursuant to both (a) the Securities
Purchase Agreement by and between the Company and Castle Creek Technology
Partners LLC, dated December 9, 1999 and (b) the Securities Purchase
Agreement by and between the Company and Xxxxxxx X. and Xxxxxxxx Xxxx,
Xxxxxxx X.
2
and Xxxxxxx Xxxxxx, Xxxxxx Xxxxx-Xxxxx and Avalon Panama S.A., dated
December 9, 1999; (2) Warrants under Subscription Agreements by and between
the Company and various investors dated November 24, 2000; (3) Warrant
issued by the Company to Jefferies & Company, Inc., dated November 24,
2000.
(i) SHARE PURCHASE AGREEMENTS, RIGHTS PLANS OR AGREEMENTS CONTAINING SIMILAR
PROVISIONS AND AGREEMENTS CONTAINING ANTI-DILUTION PROVISIONS: (1) Insignia
Solutions plc ADSs Purchase Warrants (Initial Warrant and Reset Warrant)
pursuant to both (a) the Securities Purchase Agreement by and between the
Company and Castle Creek Technology Partners LLC, dated December 9, 1999
and (b) the Securities Purchase Agreement by and between the Company and
Xxxxxxx X. and Xxxxxxxx Xxxx, Xxxxxxx X. and Xxxxxxx Xxxxxx, Xxxxxx
Xxxxx-Xxxxx and Avalon Panama S.A., dated December 9, 1999; (2) Warrants
under Subscription Agreements by and between the Company and various
investors dated November 24, 2000.
(j) OTHER THAN THOSE WAIVED PRIOR TO CLOSING, ANTI-DILUTION PROVISIONS WHICH
HAVE, INDIVIDUALLY OR IN THE AGGREGATE, ANY DILUTIVE EFFECT ON SUBSCRIBER'S
INVESTMENT THAT ARE TRIGGERED AS A RESULT OF ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY: Anti-dilution provisions are contained in (1) Insignia
Solutions plc ADSs Purchase Warrants (Initial Warrant and Reset Warrant)
pursuant to both (a) the Securities Purchase Agreement by and between the
Company and Castle Creek Technology Partners LLC, dated December 9, 1999
and (b) the Securities Purchase Agreement by and between the Company and
Xxxxxxx X. and Xxxxxxxx Xxxx, Xxxxxxx X. and Xxxxxxx Xxxxxx, Xxxxxx
Xxxxx-Xxxxx and Avalon Panama S.A., dated December 9, 1999; and (2)
Warrants under Subscription Agreements by and between the Company and
various investors dated November 24, 2000.
(k) SUBSIDIARIES OF THE COMPANY (ALL SUBSIDIARIES ARE ONE HUNDRED PERCENT
(100%) OWNED BY THE COMPANY): Jeode Limited (High Wycombe, England);
Insignia Solutions Inc. (Fremont, California); Insignia Solutions
International Limited (High Wycombe, England). Insignia Solutions Inc. owns
100% of Emulation Technologies Inc. (Dormant) and Insignia Solutions
Foreign Sales Inc (Dormant and Barbados). Insignia Solutions International
Limited owns 100% of Insignia Solutions France SARL (France).
(l) INVESTMENTS, EITHER DEBT OR EQUITY, IN ANY OTHER ENTITY (OTHER THAN
WHOLLY-OWNED SUBSIDIARIES) HELD BY THE COMPANY: None.
3
SCHEDULE 4.6
CONSENTS, AUTHORIZATIONS OR ORDERS OF, FILINGS OR REGISTRATIONS WITH, ANY COURT
OR GOVERNMENTAL AGENCY OR ANY REGULATORY OR SELF-REGULATORY AGENCY IN ORDER TO
EXECUTE, DELIVER OR PERFORM ANY OBLIGATION UNDER THE AGREEMENT:
The Company must submit Form 88(2) (allotment of shares) to the Registrar of
Companies at U.K. Companies House;
The Company is required to give notice to the U.K. Inland Revenue pursuant to
Section 68(3) of the Finance Xxx 0000.
4
SCHEDULE 4.7
UPDATED OR AMENDED STATEMENTS MADE IN ANY SEC DOCUMENT, EXCEPT PURSUANT TO FILED
SEC DOCUMENTS:
Correction to the form 10Q for the quarterly period ended June 30, 2000:
On page eleven, paragraph one, the date "December 10, 2000, " the last date for
potential warrant resets with respect to the Company's December 1999 private
placement, should read "March 28, 2001."
Correction to the form 10K for the Fiscal Year Ended December 31, 1999:
On page 25, paragraph three, the date "December 10, 2000," the last date for
potential warrant resets with respect to the Company's December 1999 private
placement, should read "March 28, 2001."
UPDATED OR AMENDED FINANCIAL STATEMENTS OF THE COMPANY:
In February 1997, Insignia restated its financial results for the quarters
ending March 31 and June 30, 1996.
5
SCHEDULE 4.19
Key Employee Names and capacity:
NAME: CAPACITY:
---- --------
Xxxxxxx X. Xxxxxx President, Chief Executive Officer, Director
Xxxxxxx X. Xxxxxx* Chief Financial Officer, Secretary, Senior Vice President
Xxxx X. XxXxxxxx Chief Operating Officer
Xxxxxx Xxxxxx Senior Vice President of Engineering and UK General Manager
Xxxxxxxx Xxxxxx Chief Technology Officer
Xxxxxx X. Xxxxxxx Senior Vice President of Marketing
Xxxx Xxxxxxx Senior Vice President of Corporate Development and Strategic
Relations
* Xx. Xxxxxx is leaving the employment of the Company and his last day
with the Company is expected to be March 15, 2001. The Company is currently
interviewing candidates for a replacement.
6
EXHIBIT A TO SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT SIGNATURE PAGE
PLEASE PRINT OR TYPE. USE BLACK INK ONLY.
(ALL PARTIES MUST SIGN)
The undersigned investor hereby certifies that it (i) has received and
relied solely upon the Memorandum and the SEC Documents, (ii) agrees to all the
terms and conditions of this Subscription Agreement, (iii) meets the suitability
standards set forth in this Subscription Agreement and (iv) is a resident of the
state or foreign jurisdiction indicated below.
The undersigned investor hereby subscribes for (i) ________ shares of
ADSs of Insignia Solutions plc at a price of $5.00 per ADS and (ii) ________
Warrants exercisable for ________________ ADSs.
Type of subscriber entity:
------------------------------------------- [X] Trust
Name of Subscriber (Print) [X] Limited Liability Company
[X] Limited Partnership
------------------------------------------- [X] General Partnership
[X] Corporation
------------------------------------------- [X] Individual
Name of Signatory (Print) [X] Other
--------------------
-------------------------------------------
-------------------------------------------
Capacity of Signatory (if applicable)
X
-------------------------------------------
Signature
Backup Withholding:
[X] Please check this box only
------------------------------------------- if the investor is subject
Subscriber's Taxpayer Identification Number to backup withholding
Foreign Person:
[X] Please check this box only
------------------------------------------- if the investor is a
Subscriber's Principal Address nonresident alien, foreign
corporation, foreign
partnership, foreign trust
or foreign estate.
-------------------------------------------
City State Zip
(-----)--------------- (-----)-------------
Phone Number Fax Number
The investor agrees to the terms of this Subscription Agreement and, as required
by the Regulations pursuant to the Internal Revenue Code, certifies under
penalty of perjury that (1) the Taxpayer Identification Number and address
provided above is correct, (2) the investor is not subject to backup withholding
(unless the Backup Withholding Statement box is checked) either because it has
not been notified that it is subject to backup withholding as a result of a
failure to report all interest or dividends or because the Internal Revenue
Service has notified the investor that it is no longer subject to backup
withholding and (3) the investor (unless the Foreign Person box above is
checked) is not a nonresident alien, foreign partnership, foreign trust or
foreign estate.
THE SUBSCRIPTION FOR (i) ______________________ SHARES OF ADSs OF INSIGNIA
SOLUTIONS plc AT A PRICE OF $5.00 PER ADS AND (ii) ______________________
WARRANTS TO SUBSCRIBE FOR ADSs BY THE ABOVE NAMED SUBSCRIBER IS ACCEPTED THIS
_______ DAY OF __________________, 2001.
INSIGNIA SOLUTIONS plc
By:__________________________________
Name:
Title:
EXHIBIT A
EXHIBIT B TO SUBSCRIPTION AGREEMENT
INSIGNIA SOLUTIONS PLC
LOCK-UP AGREEMENT
__________ __, 200_
Jefferies & Company, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
In consideration of the benefits gained by the undersigned in
connection with the private placement (the "PRIVATE PLACEMENT"), with Jefferies
& Company, Inc. ("JEFFERIES") acting as placement agent (the "PLACEMENT AGENT")
of the American depositary shares (the "ADSs"), each ADS representing one
ordinary share of the 20 xxxxx each nominal value (the "ORDINARY SHARES") of
Insignia Solutions plc, a public limited company organized and existing under
the laws of England and Wales (the "COMPANY") on the date hereof, and for other
good and valuable consideration, receipt of which is hereby acknowledged, the
undersigned hereby agrees, for a period beginning on the date hereof and ending
on the date which is the later to occur of (x) 180 days after the closing of the
Private Placement or (y) the date the Securities and Exchange Commission
declares the registration statement filed by the Company as required pursuant to
certain registration rights granted to the Investors to register ADSs purchased
in the Private Placement effective (the "LOCK-UP PERIOD"), not to sell, offer to
sell, solicit an offer to buy, contract to sell, exercise, encumber, distribute,
pledge, grant any option for the sale of, or otherwise transfer or dispose of,
directly or indirectly, in one or a series of transactions (collectively, a
"DISPOSITION"), any ADSs, American depositary receipts ("ADRs") or Ordinary
Shares, any options or warrants to purchase any ADSs, ADRs or Ordinary Shares or
any securities convertible or exercisable into or exchangeable for ADSs, ADRs or
Ordinary Shares (collectively, "SECURITIES"), not owned or hereafter acquired by
the undersigned or with respect to which the undersigned has acquired or
hereafter acquires the power of disposition, without the prior written consent
of Jefferies. Notwithstanding the foregoing, however, the undersigned may make a
Disposition in connection with a bona fide tender offer by a non-affiliated
third party of the Company or the undersigned (the "OFFEROR") for at least 50%
of the equity securities of the Company by tendering the undersigned's
beneficially owned securities to the Offeror.
The undersigned acknowledges and agrees that the restrictions above are
expressly agreed to preclude the holder of the Securities from engaging in any
hedging or other transaction which is designed to or reasonably expected to lead
to or result in a Disposition of Securities (or the economic equivalent thereof)
during the Lock-Up Period even if such Securities would be disposed of by
someone other than the undersigned. Such prohibited hedging or other
transactions would include, without limitation, any short sale (whether or not
against the box) or
any purchase, sale or grant of any right (including without limitation, any put
or call option) with respect to any Securities or with respect to any security
(other than a broad-based marked basket or index) that includes, relates to or
derives any significant part of its value from the Securities.
The undersigned hereby also agrees and consents to the entry of stop
transfer instructions with the Company's transfer agent against the transfer of
the Securities held by the undersigned except in compliance with this Lock-Up
Agreement.
The undersigned hereby represents and warrants as of the date hereof to
the Placement Agent and the Company that this Lock-Up Agreement has been duly
executed and delivered, and this Lock-Up Agreement constitutes a valid and
binding obligation of the undersigned, enforceable in accordance with its terms.
This Lock-Up Agreement shall be governed by and construed in accordance
with the laws of the State of New York (without giving effect to its conflict of
laws provisions).
Very truly yours,
Name:
B-2
