EXHIBIT 99.1
SECURITIES PURCHASE AGREEMENT
by and among
THE INVESTORS LISTED HEREIN
and
SONICBLUE INCORPORATED
Dated as of
April 21, 2002
TABLE OF CONTENTS
Page
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1. PURCHASE AND SALE OF DEBENTURES AND WARRANTS........................................2
2. BUYER'S REPRESENTATIONS AND WARRANTIES..............................................2
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.......................................5
4. COVENANTS...........................................................................15
5. TRANSFER AGENT INSTRUCTIONS.........................................................17
6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL......................................18
7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE...................................19
8. INDEMNIFICATION.....................................................................20
9. MISCELLANEOUS.......................................................................21
SCHEDULES
Schedule 3(a) - Subsidiaries
Schedule 3(c) - Capitalization
Schedule 3(e) - Conflicts
Schedule 3(f) - SEC Documents
Schedule 3(m) - Title
Schedule 3(s) - Transactions with Affiliates
Schedule 9(m) - Placement Agent
EXHIBITS
Exhibit A-1 - Form of Indenture
Exhibit A-2 - Form of Debentures
Exhibit B - Form of Warrant
Exhibit C - Form of Registration Rights Agreement
Exhibit D - Form of Pledge and Security Agreement
Exhibit E - Form of Option Agreement
Exhibit F - Form of Irrevocable Transfer Agent Instructions
Exhibit G - Form of Opinion of Pillsbury Winthrop LLP
Exhibit H - Form of Opinion of Xxx and Li
INDEX
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1933 Act.....................................................................................1
1934 Act.....................................................................................8
1996 Indenture...............................................................................6
2001 Form 10-K...............................................................................6
Additional Securities.......................................................................17
Agreement....................................................................................1
Business Day................................................................................15
Buyer........................................................................................1
By-laws......................................................................................6
Certificate of Incorporation.................................................................6
Closing......................................................................................2
Closing Date.................................................................................2
Common Stock.................................................................................1
Company......................................................................................1
Conversion Shares............................................................................1
Environmental Laws..........................................................................11
GAAP.........................................................................................8
GKM..........................................................................................6
GKM Warrants.................................................................................6
Hazardous Materials.........................................................................11
Indemnified Liabilities.....................................................................21
Indemnitees.................................................................................21
Indenture....................................................................................1
Irrevocable Transfer Agent Instructions.....................................................18
Material Adverse Effect......................................................................5
NASDAQ......................................................................................15
NYSE........................................................................................15
Permits.....................................................................................12
Principal Market............................................................................14
Registration Rights Agreement................................................................1
Regulation D.................................................................................1
Reporting Period............................................................................13
Resolutions.................................................................................20
Rights Plan..................................................................................6
Rule 144.....................................................................................3
SEC..........................................................................................1
SEC Documents................................................................................8
Securities...................................................................................2
Subordinated Notes...........................................................................6
Subsidiaries.................................................................................4
Transaction Documents........................................................................5
Warrant Shares...............................................................................1
Warrants.....................................................................................1
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SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (the "Agreement"), dated as of
April 21, 2002, by and among SONICblue Incorporated, a Delaware corporation,
with headquarters located at 0000 Xxxxxxx Xxxxxxx Xxxxxxxxx, Xxxxx Xxxxx,
Xxxxxxxxxx 00000 (the "Company"), and the investors listed on the Schedule of
Buyers attached hereto (individually, a "Buyer" and collectively, the "Buyers").
WHEREAS:
A. The Company and the Buyers are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by Rule 506 of Regulation D ("Regulation D") as promulgated by the United States
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "1933 Act").
B. The Company has authorized the issuance of up to $75 million
principal amount of its 7 3/4% Secured Senior Subordinated Convertible
Debentures due 2005, which shall be governed by the Indenture (the "Indenture"),
dated as of the Closing Date and in the form attached hereto as Exhibit A-1,
among the Company and the Buyers (collectively, the "Debentures"), which shall
be convertible into shares of the Company's common stock, par value $0.0001 per
share (the "Common Stock") (as converted, the "Conversion Shares"), in
accordance with the terms of the Debentures.
C. The Buyers severally wish to purchase, upon the terms and
conditions stated in this Agreement, (i) an aggregate of $75 million principal
amount of Debentures on the Closing Date (as defined below), such Debentures to
be in the form attached hereto as Exhibit A-2 (the "Debentures") in the
respective amounts set forth opposite each Buyer's name on the Schedule of
Buyers for the purchase price set forth on the Schedule of Buyers and (ii)
warrants (the "Warrants") to purchase one hundred thousand (100,000) shares of
Common Stock (as exercised collectively, the "Warrant Shares") for each
$1,000,000 principal amount of Debentures purchased by such Buyer on the Closing
Date, such Warrants to be substantially in the form attached hereto as Exhibit
B.
D. Contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement substantially in the form attached hereto as Exhibit C (the
"Registration Rights Agreement") pursuant to which the Company has agreed to
provide certain registration rights under the 1933 Act and the rules and
regulations promulgated thereunder, and applicable state securities laws.
E. The location of defined terms in this Agreement is set forth
on the Index of Terms attached hereto.
NOW THEREFORE, the Company and the Buyers hereby agree as
follows:
1. PURCHASE AND SALE OF DEBENTURES AND WARRANTS.
a. Purchase of Debentures and Warrants. Subject to the
satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below,
the Company shall issue and sell to each Buyer, and each Buyer severally agrees
to purchase from the Company, the respective principal amount of Debentures,
together with the related Warrants, set forth opposite such Buyer's name on the
Schedule of Buyers (the "Closing").
b. The Closing. The date and time of the Closing (the
"Closing Date") shall be no later than 10:00 a.m., New York City time, on April
22, 2002, unless otherwise extended by the Buyers in their sole discretion,
subject to the satisfaction (or waiver) of the conditions set forth in Sections
6 and 7 or, if requested by the Company, such later date as is agreed to by the
Buyers in their sole discretion. The Closing shall occur on the Closing Date at
the offices of Xxxxxxx Xxxx & Xxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000.
c. Form of Payment. On the Closing Date, (A) each Buyer
shall pay the Company for the Debentures and the related Warrants to be issued
and sold to such Buyer on the Closing Date, by wire transfer of immediately
available funds in accordance with the Company's written wire instructions, less
any amount withheld at the Closing for expenses pursuant to Section 4(k), and
(B) the Company shall deliver to each Buyer Debentures (in the denominations as
such Buyer shall request) representing the principal amount of Debentures which
such Buyer is then purchasing hereunder, along with warrants representing the
related Warrants, in each case, duly executed on behalf of the Company and
registered in the name of such Buyer.
2. BUYER'S REPRESENTATIONS AND WARRANTIES.
Each Buyer represents and warrants with respect to only itself
that:
a. Investment Purpose. Such Buyer (i) is acquiring the
Debentures and the Warrants, (ii) upon conversion of the Debentures owned by it,
will acquire the Conversion Shares then issuable and (iii) upon exercise of the
Warrants held by it, will acquire the Warrant Shares issuable upon exercise
thereof (the Debentures, the Conversion Shares, the Warrants and the Warrant
Shares collectively are referred to herein as the "Securities") for its own
account for investment only and not with a view towards, or for resale in
connection with, the public sale or distribution thereof, except pursuant to
sales registered or exempted under the 1933 Act; provided, however, that by
making the representations herein, such Buyer does not agree to hold any of the
Securities for any minimum or other specific term and reserves the right to
dispose of the Securities at any time, provided further, however, that such
disposition shall be in accordance with or pursuant to a registration statement
or an exemption under the 1933 Act.
b. Accredited Investor Status. Such Buyer is an
"accredited investor" as that term is defined in Rule 501(a)(3) of Regulation D
under the 1933 Act, and at the time it exercises any Warrants or converts any
Debentures issued to it, such Buyer will continue to be an "accredited
investor".
c. Reliance on Exemptions. Such Buyer understands that
the Securities are being offered and sold to it in reliance on specific
exemptions from the registration
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requirements of the United States federal and state securities laws and that the
Company is relying upon the truth and accuracy of, and such Buyer's compliance
with, the representations, warranties, agreements, acknowledgments and
understandings of such Buyer set forth herein in order to determine the
availability of such exemptions and the eligibility of such Buyer to acquire the
Securities.
d. Information. Such Buyer and its advisors, if any,
have been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Securities which have been requested by such Buyer. Such Buyer and its advisors,
if any, have been afforded the opportunity to ask questions of the Company.
Neither such inquiries nor any other due diligence investigations conducted by
such Buyer or its advisors, if any, or its representatives shall modify, amend
or affect such Buyer's right to rely on the Company's representations and
warranties contained in this Agreement.
e. No Governmental Review. Such Buyer understands that
no United States federal or state agency or any other government or governmental
agency has passed on or made any recommendation or endorsement of the Securities
or the fairness or suitability of the investment in the Securities nor have such
authorities passed upon or endorsed the merits of the offering of the
Securities.
f. Transfer or Resale. Such Buyer understands that
except as provided in the Registration Rights Agreement: (i) the Securities have
not been and are not being registered under the 1933 Act or any state securities
laws, and may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered thereunder, (B) such Buyer shall have delivered to the
Company an opinion of counsel, in a form reasonably acceptable to the Company
and its counsel, to the effect that such Securities to be sold, assigned or
transferred may be sold, assigned or transferred pursuant to an exemption from
such registration, or (C) such Buyer provides the Company with reasonable
assurance that such Securities can be sold, assigned or transferred pursuant to
Rule 144 promulgated under the 1933 Act (or a successor rule thereto) ("Rule
144"); (ii) any sale of the Securities made in reliance on Rule 144 may be made
only in accordance with the terms of Rule 144 and further, if Rule 144 is not
applicable, any resale of the Securities under circumstances in which the seller
(or the person through whom the sale is made) may be deemed to be an underwriter
(as that term is defined in the 0000 Xxx) may require compliance with some other
exemption under the 1933 Act or the rules and regulations of the SEC thereunder;
and (iii) neither the Company nor any other person is under any obligation to
register the Securities under the 1933 Act or any state securities laws or to
comply with the terms and conditions of any exemption thereunder. The Securities
may be pledged in connection with a bona fide margin account or other loan
secured by the Securities.
g. Legends. Such Buyer understands that the Debentures
and Warrants and, until such time as the sale of the Conversion Shares and the
Warrant Shares have been registered under the 1933 Act as contemplated by the
Registration Rights Agreement, the stock certificates representing the
Conversion Shares and the Warrant Shares, except as set forth below, shall bear
a restrictive legend in substantially the following form (and a stop-transfer
order may be placed against transfer of such Debentures, Warrants and stock
certificates):
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THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN
THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B) AN
OPINION OF COUNSEL, IN A FORM REASONABLY ACCEPTABLE TO THE
COMPANY AND ITS COUNSEL, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II)
UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR
OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.
The legend set forth above shall be removed upon a request to the Company's
transfer agent for removal and the Company shall issue the relevant securities
without such legend to the holder of the Securities upon which it is stamped,
if, (i) such Securities are registered for resale under the 1933 Act, (ii) in
connection with a sale transaction, such holder provides the Company with an
opinion of counsel, in a form reasonably acceptable to the Company and its
counsel, to the effect that a public sale, assignment or transfer of the
Securities may be made without registration under the 1933 Act, or (iii) such
holder provides the Company with reasonable assurances that the Securities can
be sold pursuant to Rule 144 without any restriction as to the number of
securities acquired as of a particular date that can then be immediately sold.
h. Authorization; Enforcement; Validity. This Agreement,
the Pledge and Security Agreement (as defined in Section 3(b)) and the
Registration Rights Agreement have been duly and validly authorized, executed
and delivered on behalf of such Buyer and are valid and binding agreements of
such Buyer enforceable against such Buyer in accordance with their terms,
subject as to enforceability to general principles of equity and to applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation and other
similar laws relating to, or affecting generally, the enforcement of applicable
creditors' rights and remedies.
i. Residency. Such Buyer is a resident of that country
or state specified in its address on the Schedule of Buyers.
j. No Conflicts. The execution, delivery and performance
of the Transaction Documents by the Buyers and the consummation by the Buyers of
the transactions contemplated hereby and thereby will not result in a violation
of the certificate of incorporation, by-laws or other governing document or
instrument of the Buyers.
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k. Risk of Loss. Such Buyer can bear the economic risk
of its investment in the Securities and has such knowledge and experience in
financial and business matters that it is capable of evaluating the merits and
the risks of the investment in the Securities.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each of the Buyers that:
a. Organization and Qualification. The Company and its
Subsidiaries are corporations or limited liability companies duly organized and
validly existing in good standing under the laws of the jurisdiction in which
they are incorporated or organized, and have the requisite corporate or other
power and authorization to own their properties and to carry on their business
as now being conducted. Each of the Company and its Subsidiaries is duly
qualified as a foreign corporation or limited liability company to do business
and is in good standing in every jurisdiction in which its ownership of property
or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing would not have a Material Adverse Effect. As used in this
Agreement, "Material Adverse Effect" means any material adverse effect on the
business, properties, assets, operations, results of operations or financial
condition of the Company and its Subsidiaries, if any, taken as a whole, or on
the transactions contemplated hereby or by the agreements and instruments to be
entered into in connection herewith, or on the authority or ability of the
Company to perform its obligations under the Transaction Documents (as defined
below). As used in this Agreement, "Subsidiaries" means any entity in which the
Company, directly or indirectly, owns a majority of the capital stock or other
equity or similar interests or owns capital stock or holds an equity or similar
interest which ownership entitles the Company to elect a majority of the board
of directors or similar governing body of such entity, other than S3 - VIA, Inc.
and S3 Graphics Co., Ltd. The Company owns or holds such capital stock or other
equity or similar interests in the Subsidiaries free and clear of any lien,
pledge, option, security interest, claim, charge, third party right or any other
restriction or encumbrance of any nature whatsoever. A complete list of entities
in which the Company, directly or indirectly, owns capital stock or holds an
equity or similar interest is set forth on Schedule 3(a).
b. Authorization; Enforcement; Validity. The Company has
the requisite corporate power and authority to enter into and perform its
obligations under this Agreement, the Debentures, the Warrants, the Registration
Rights Agreement, the Indenture, the Pledge and Security Agreement, dated as of
the Closing Date, among the Company and the Buyers substantially in the form
attached hereto as Exhibit D (the "Pledge and Security Agreement"), the Option
Agreement, dated as of the Closing Date, among the Company and the Buyers
substantially in the form attached hereto as Exhibit E, the Irrevocable Transfer
Agent Instructions (as defined in Section 5) and each of the other agreements
entered into by the parties hereto in connection with the transactions
contemplated by this Agreement (collectively, the "Transaction Documents"), and
to issue the Securities in accordance with the terms hereof and thereof. The
execution and delivery of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby,
including, without limitation, the issuance of the Debentures, the reservation
for issuance and the issuance of the Conversion Shares issuable upon conversion
thereof, the issuance of the Warrants and the reservation for issuance and the
issuance of the Warrant Shares issuable upon exercise of the
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Warrants, have been duly authorized by the Company's Board of Directors and no
further consent or authorization is required by the Company, its Board of
Directors or its stockholders. The Transaction Documents have been, or will be
prior to Closing, duly executed and delivered by the Company. The Transaction
Documents constitute, or will constitute prior to Closing, the valid and binding
obligations of the Company enforceable against the Company in accordance with
their terms, except as such enforceability may be limited by general principles
of equity or applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement
of creditors' rights and remedies.
c. Capitalization. The authorized capital stock of the
Company consists of: (a) 175,000,000 shares of Common Stock, par value $0.0001
per share, of which 95,545,225 shares are outstanding as of April 15, 2002 and
there have been no material changes in such number since such date; and (b)
5,000,000 shares of Preferred Stock, par value $0.0001 per share, of which
500,000 shares have been designated Series A Participating Preferred Stock. No
shares of Preferred Stock are outstanding, and 500,000 shares of Series A
Participating Preferred Stock are reserved for issuance pursuant to the Rights
Agreement dated as of May 14, 1997 between the Company and The First National
Bank of Boston, as Rights Agent (the "Rights Plan"). Except as set forth above,
and except for (i) options and warrants to purchase an aggregate of 21,127,326
shares of Common Stock outstanding as of April 15, 2002 (other than the
Debentures, the Conversion Shares, the Warrants, the Warrant Shares, the
Interest Shares (as defined in the Indenture) and the warrants issued to Xxxxxx
Xxxxxx Xxxxxxxx & Co., Inc ("GKM") as set forth in Schedule 9(m) (the "GKM
Warrants"); (ii) 5,374,611 shares of Common Stock reserved for issuance upon
conversion of the Company's 5 3/4% Convertible Subordinated Notes due 2003 (the
"Subordinated Notes") issued pursuant to the Indenture dated as of September 12,
1996 (the "1996 Indenture") between the Company and State Street Bank and Trust
Company, N.A.; and (iii) up to 2,800,000 shares of Common Stock reserved for
issuance in connection with the settlement of litigation described in the
Company's Annual Report on Form 10-K for the year ended December 31, 2001 (the
"2001 Form 10-K") under Item 3 - Legal Proceedings, there are no other
securities exercisable or exchangeable for, or convertible into, shares of
Common Stock nor any agreements or understandings pursuant to which any
securities exercisable or exchangeable for, or convertible into, shares of
Common Stock may become outstanding. All of such outstanding shares have been,
or upon issuance will be, validly issued and are fully paid and nonassessable.
Except as disclosed in this Section 3(c) or in Schedule 3(c), (A) no shares of
the Company's capital stock are subject to preemptive rights or any other
similar rights (arising under Delaware law, California law, the Company's
Certificate of Incorporation or By-laws or any agreement or instrument to which
the Company is a party) or are subject to any liens or encumbrances granted or
created by the Company; (B) there are no outstanding options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, any shares of capital
stock of the Company 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 of capital stock of the
Company or any of its Subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into, any shares of capital stock of the
Company or any of its Subsidiaries; (C) there are no outstanding debt
securities, notes, credit agreements, credit facilities or other agreements,
documents or instruments evidencing indebtedness of the Company or any of its
Subsidiaries or
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by which the Company or any of its Subsidiaries is or may become bound; (D)
there are no amounts outstanding under, and there will be no amounts due upon
termination of, any credit agreement or credit facility; (E) there are no UCC
financing statements filed in connection with the Company or any of its
Subsidiaries; (F) there are no agreements or arrangements under which the
Company or any of its Subsidiaries is obligated to register the sale of any of
their securities under the 1933 Act (except the Registration Rights Agreement);
(G) there are no outstanding securities or instruments of the Company or any of
its Subsidiaries which contain any redemption or similar provisions, and there
are no contracts, commitments, understandings or arrangements by which the
Company or any of its Subsidiaries is or may become bound to redeem a security
of the Company or any of its Subsidiaries; (H) there are no securities or
instruments containing anti-dilution or similar provisions related to the Common
Stock that will be triggered by the transaction contemplated hereby; (I) the
Company does not have any stock appreciation rights or "phantom stock" plans or
agreements or any similar plan or agreement; (J) since December 31, 2001, no
officer, director or beneficial owner of 5% or more of the Company's outstanding
capital stock has pledged shares of the Company's capital stock in connection
with a margin account or other loan secured by such capital stock; and (K) the
Company and its Subsidiaries have no liabilities or obligations required to be
disclosed in the SEC Documents (as defined in Section 3(f)) but not so disclosed
in the SEC Documents, other than those incurred in the ordinary course of the
Company's or its Subsidiaries' respective businesses since December 31, 2001 and
which, individually or in the aggregate, do not or would not have a Material
Adverse Effect on the Company and its Subsidiaries taken as a whole. The Company
has made available to each Buyer true and correct copies of the Company's
Restated Certificate of Incorporation, as amended and as in effect on the date
hereof (the "Certificate of Incorporation"), and the Company's By-laws, as
amended and as in effect on the date hereof (the "By-laws"), and the terms of
all securities convertible into or exercisable or exchangeable for Common Stock
and the material rights of the holders thereof in respect thereto except for
stock options granted under any benefit plan or stock option plan of the Company
approved by the Board of Directors of the Company.
d. Issuance of Securities. The Securities are duly
authorized and, upon issuance in accordance with the terms of the applicable
Transaction Documents, shall be (i) validly issued, fully paid and
non-assessable and (ii) free from all taxes, liens and charges with respect to
the issuance thereof, (other than any such taxes, liens and charges created by
any Buyer or assignee or transferee of a Buyer) and shall not be subject to
pre-emptive rights or other similar rights of shareholders of the Company. As of
the Closing, at least 11,792,404 shares of Common Stock (subject to adjustment
pursuant to the Company's covenant set forth in Section 4(f) below) will have
been duly authorized and reserved for issuance upon conversion of the
Debentures, for Interest Shares and exercise of the Warrants and up to 293,805
shares of Common Stock will have been duly authorized and reserved for issuance
upon exercise of the GKM Warrants. Upon conversion or issuance in accordance
with the Debentures or the Warrants, as applicable, the Conversion Shares and
the Warrant Shares, as the case may be, will be validly issued, fully paid and
non-assessable and free from all taxes, liens and charges with respect to the
issue thereof, (other than any such taxes, liens and charges created by any
Buyer or assignee or transferee) with the holders being entitled to all rights
accorded to a holder of Common Stock. Based, in part, on reliance on and the
accuracy of the representations and warranties of each of the Buyers in the
Transaction Documents, the issuance by the Company of the Securities is exempt
from registration under the 1933 Act.
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e. No Conflicts. The execution, delivery and performance
of the Transaction Documents by the Company and the consummation by the Company
of the transactions contemplated hereby and thereby (including, without
limitation, the reservation for issuance and issuance of the Conversion Shares
and the Warrant Shares) will not (i) result in a violation of the Certificate of
Incorporation or the By-laws; (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, indenture or instrument to which the
Company or any of its Subsidiaries is a party (except for such conflicts,
defaults, terminations, amendments, accelerations, cancellations and violations
as would not result, either individually or in the aggregate, in a Material
Adverse Effect); or (iii) result in a violation of any law, rule, regulation,
order, judgment or decree (including federal and state securities laws and
regulations and the rules and regulations of the Principal Market (as defined in
Section 4(g))) applicable to the Company or any of its Subsidiaries or by which
any property or asset of the Company or any of its Subsidiaries is bound or
affected (except for any such violation that would not result, either
individually or in the aggregate, in a Material Adverse Effect). Neither the
Company nor its Subsidiaries is in violation of any term of or in default under
its Certificate of Incorporation, By-laws or their organizational charter or
by-laws, respectively. Neither the Company nor any of its Subsidiaries is in
violation of any term of or in default under any contract, agreement, mortgage,
indebtedness, indenture, instrument, judgment, decree or order or any statute,
rule or regulation applicable to the Company or its Subsidiaries, except where
such violations and defaults would not result, either individually or in the
aggregate, in a Material Adverse Effect. The business of the Company and its
Subsidiaries is not being conducted in violation of any law, ordinance or
regulation of any governmental entity, except where such violations would not
result, either individually or in the aggregate, in a Material Adverse Effect.
Except as specifically contemplated by this Agreement, as required under the
1933 Act or as required by Blue Sky filings, 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 or contemplated by the Transaction Documents. Except as
disclosed in Schedule 3(e), all consents, authorizations, orders, filings and
registrations which the Company is required to obtain pursuant to the preceding
sentence have been obtained or effected on or prior to the date hereof. The
Company and its Subsidiaries have no actual knowledge of any facts or
circumstances which might give rise to any of the foregoing. The Company is not
in violation of the listing requirements of the Principal Market, and has no
actual knowledge of any facts which would reasonably lead to delisting or
suspension of the Common Stock by the Principal Market in the foreseeable
future.
f. SEC Documents; Financial Statements. Since December
31, 2000, the Company has 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 Securities Exchange Act of 1934, as amended (the
"1934 Act") (all of the foregoing filed prior to the date hereof and all
exhibits included therein and financial statements and schedules thereto and
documents incorporated by reference therein being hereinafter referred to as the
"SEC Documents"). As of the respective dates of filing of such SEC Documents,
such SEC Documents, as one or more may have been subsequently amended by filings
made by the Company with the SEC prior to the date hereof, complied in all
material respects with the requirements of the 1934 Act and the rules and
- 8 -
regulations of the SEC promulgated thereunder applicable to the SEC Documents.
None of the SEC Documents, as of the date filed and as they may have been
subsequently amended by filings made by the Company with the SEC prior to the
date hereof, 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 the light of the circumstances under which they
were made, not misleading. As of their respective dates, the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto. Such financial statements
have been prepared in accordance with generally accepted accounting principles,
consistently applied, ("GAAP"), during the periods involved (except (i) as may
be otherwise indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments). No other information provided by or on behalf of the Company to
the Buyers which is not included in the SEC Documents, including, without
limitation, information referred to in Section 2(d), contains any untrue
statement of a material fact or omits to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they are or were made, not misleading. Neither the Company nor any of its
Subsidiaries nor any of their officers, directors, employees or agents has
provided the Buyers with any material, nonpublic information. As of the date
hereof, the Company meets, and as of the Closing Date, the Company will meet,
the requirements for use of Form S-3 for registration of the resale of
Registrable Securities (as defined in the Registration Rights Agreement). Except
as set forth on Schedule 3(f), the Company is not required to file and will not
be required to file any agreement, note, lease, mortgage, deed or other
instrument entered into prior to the date hereof and to which the Company is a
party or by which the Company is bound which has not been previously filed as an
exhibit to its reports filed with the SEC under the 1934 Act. Except for the
issuance of the Debentures and the Warrants contemplated by this Agreement, no
event, liability, development or circumstance has occurred or exists with
respect to the Company or its Subsidiaries or their respective business
properties, operations or financial condition, that would be required to be
disclosed by the Company under applicable securities laws and which has not been
publicly disclosed.
g. Absence of Certain Changes. Except as disclosed in
the 2001 Form 10-K, since December 31, 2001, there has been no change or
development that has had or would reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect. The Company has not
taken any steps, and does not currently expect to take any steps, to seek
protection pursuant to any bankruptcy law nor does the Company or any of its
Subsidiaries have any knowledge or reason to believe that its creditors intend
to initiate involuntary bankruptcy proceedings or any actual knowledge of any
fact which would reasonably lead a creditor to do so. Since December 31, 2001,
the Company has not declared or paid any dividends, and, except for sales of
equipment and inventory in an amount not in excess of $1,000,000 in the
aggregate, as of the date hereof, the Company has not sold any assets,
individually or in the aggregate, in excess of $100,000 outside of the ordinary
course of business or had capital expenditures, individually or in the
aggregate, in excess of $2,500,000.
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h. Absence of Litigation. Except as disclosed in the
2001 Form 10-K under Item 3 - Legal Proceedings or as reserved for as an accrued
liability in the financial statements included in the 2001 Form 10-K, there is
no action, suit, proceeding, inquiry or investigation before or by any court,
public board, government agency, self-regulatory organization or body pending
or, to the knowledge of the Company or any of its Subsidiaries, threatened
against or affecting the Company, the Common Stock or any of the Company's
Subsidiaries or any of the Company's or the Company's Subsidiaries' officers or
directors in their capacities as such or, with respect to the Company and its
Subsidiaries, to the extent that any such action or threatened action does not
set forth potential liability, claims or charges individually in excess of
$1,000,000, or in the aggregate in excess of $5,000,000. To the knowledge of the
Company, none of the directors or officers of the Company have been a party to
any securities related litigation during the past five years other than as set
forth in the 2001 Form 10-K under Item 3 - Legal Proceedings.
i. No Undisclosed Events, Liabilities, Developments or
Circumstances. Except for the issuance of the Debentures and the Warrants
contemplated by this Agreement, no event, liability, development or circumstance
has occurred or exists with respect to the Company or its Subsidiaries or their
respective business, properties, operations or financial condition, that would
be required to be disclosed by the Company under applicable securities laws and
which has not been publicly disclosed.
j. No Integrated Offering. Neither the Company, nor any
of its affiliates, nor any person acting on its or 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 require registration of the
issuance by the Company of any of the Securities under the 1933 Act or cause
this offering of the Securities to be integrated with prior offerings by the
Company for purposes of the 1933 Act or any applicable stockholder approval
provisions, including, without limitation, under the rules and regulations of
any exchange or automated quotation system on which any of the securities of the
Company are listed or designated, nor will the Company or any of its
Subsidiaries take any action or steps that would require registration of the
issuance by the Company of any of the Securities under the 1933 Act or cause the
offering of the Securities to be integrated with other offerings.
k. Employment Matters; ERISA Matters. (i) Neither the
Company nor any of its Subsidiaries is involved in any union labor dispute nor,
to the knowledge of the Company or any of its Subsidiaries, is any such dispute
threatened. None of the Company's or its Subsidiaries' employees is a member of
a union which relates to such employee's relationship with the Company, neither
the Company nor any of its Subsidiaries is a party to a collective bargaining
agreement, and the Company and its Subsidiaries believe that their relations
with their employees are good. No executive officer (as defined in Rule 501(f)
of the 0000 Xxx) has notified the Company that such officer intends to leave the
Company or otherwise terminate such officer's employment with the Company.
(ii) The Company and its Subsidiaries are in compliance
with all federal, state, local and foreign laws and regulations respecting
employment and employment practices, terms and conditions of employment and
wages and hours and benefits, except where
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failure to be in compliance would not, either individually or in the aggregate,
have a Material Adverse Effect.
l. Intellectual Property Rights. The Company and its
Subsidiaries own or possess adequate rights or licenses to use all trademarks,
trade names, service marks, service xxxx registrations, service names, patents,
patent rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and other intellectual property rights necessary
to conduct their respective businesses as now conducted, except where the
failure to own or possess such rights would not result, either individually or
in the aggregate, in a Material Adverse Effect. None of the Company's
trademarks, trade names, service marks, service xxxx registrations, service
names, patents, patent rights, copyrights, inventions, licenses, approvals,
governmental authorizations, trade secrets or other intellectual property rights
have expired or terminated, or are expected to expire or terminate (without
being renewed) within two years from the date of this Agreement, except where
such expiration or termination would not result, either individually or in the
aggregate, in a Material Adverse Effect. Except as would not have a Material
Adverse Effect, the Company and its Subsidiaries do not have any knowledge of
any infringement by the Company or its Subsidiaries of trademarks, trade names,
service marks, service xxxx registrations, service names, patents, patent
rights, copyrights, inventions, licenses, trade secrets or other intellectual
property rights of others, and except as would not have a Material Adverse
Effect, there is no claim, action or proceeding being made or brought against,
or to the knowledge of the Company, being threatened against, the Company or its
Subsidiaries regarding its trademarks, trade names, service marks, service xxxx
registrations, service names, patents, patent rights, copyrights, inventions,
licenses, trade secrets, or infringement of other intellectual property rights.
The Company and its Subsidiaries have taken commercially reasonable security
measures to protect the secrecy, confidentiality and value of all of their
intellectual properties.
m. Title. The Company and its Subsidiaries have good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them which is material to the business
of the Company and its Subsidiaries, in each case free and clear of all liens,
encumbrances and defects except such as are described in Schedule 3(m) or such
as do not materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company and any of
its Subsidiaries. Any real property and facilities held under lease by the
Company and any of its Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and facilities by the
Company and its Subsidiaries.
n. Environmental Laws. Except in each case where the
failure of the Company and its Subsidiaries would not, either individually or in
the aggregate, have a Material Adverse Effect, (i) the Company and its
Subsidiaries (A) are in compliance with any and all Environmental Laws, (B) have
received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses, and (C)
are in compliance with all terms and conditions of any such permit, license or
approval. Except as would not have a Material Adverse Effect, with respect to
the Company and/or its Subsidiaries (1) there are no past or present releases of
any material into the environment, actions, activities, circumstances,
conditions, events, incidents, or contractual obligations which may give rise to
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any common law environmental liability or any liability under any Environmental
Law and (2) neither the Company nor any of its Subsidiaries has received any
notice with respect to the foregoing, nor is any action pending or, to the
knowledge of the Company, threatened in connection with the foregoing. The term
"Environmental Laws" means all federal, state, local or foreign laws relating to
pollution or protection of human health or the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants, or toxic
or hazardous substances or wastes (collectively, "Hazardous Materials") into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all authorizations, codes, decrees, demands or demand letters,
injunctions, judgments, licenses, notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.
(ii) Other than those that are or were stored, used or
disposed of in compliance with applicable law, to the knowledge of the Company,
no Hazardous Materials are contained on or about any real property currently
owned, leased or used by the Company or any of its Subsidiaries, and no
Hazardous Materials were released on or about any real property previously
owned, leased or used by the Company or any of its Subsidiaries during the
period the property was owned, leased or used by the Company or any of its
Subsidiaries.
(iii) To the knowledge of the Company, there are no
underground storage tanks on or under any real property owned, leased or used by
the Company or any of its Subsidiaries that are not in compliance with
applicable law.
o. Insurance. The Company and each of its Subsidiaries
are insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as management of the Company believes to be
prudent and customary in the businesses in which the Company and its
Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been
refused any insurance coverage sought or applied for and neither the Company nor
any such Subsidiary has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.
p. Regulatory Permits. Except for Permits (as defined
below) the absence of which would not result, either individually or in the
aggregate, in a Material Adverse Effect, the Company and its Subsidiaries
possess all certificates, authorizations and permits issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their
respective businesses (the "Permits"), and neither the Company nor any such
Subsidiary has received any notice of proceedings relating to the revocation or
modification of any such Permit.
q. No Materially Adverse Contracts, Etc. Neither the
Company nor any of its Subsidiaries is subject to any charter, corporate or
other legal restriction, or any judgment, decree, order, rule or regulation
which in the judgment of the Company's executive officers has or is expected in
the future to have a Material Adverse Effect.
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r. Tax Status. The Company and each of its Subsidiaries
(i) has made or filed all federal and state income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject,
(ii) has paid all taxes and other governmental assessments and charges that are
material in amount, shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and for which the
Company has made appropriate reserves for on its books, and (iii) has set aside
on its books provisions reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
(referred to in clause (i) above) apply. There are no unpaid taxes in any
material amount claimed to be due by the taxing authority of any jurisdiction,
and the executive officers of the Company know of no basis for any such claim.
s. Transactions With Affiliates. Except as set forth on
Schedule 3(s) or in the SEC Documents, and other than the grant of stock options
described on Schedule 3(c), none of the officers, directors or employees of the
Company is presently a party to any transaction with the Company or any of its
Subsidiaries (other than for services as employees, officers and directors) that
would be required to be reported by Regulation S-K, Item 404, promulgated under
the 1933 Act, including any contract, agreement or other arrangement providing
for the furnishing of services to or by, providing for rental of real or
personal property to or from, or otherwise requiring payments to or from any
such officer, director or employee or, to the knowledge of the Company, any
corporation, partnership, trust or other entity in which any such officer,
director, or employee has a substantial interest or is an officer, director,
trustee or partner.
t. Application of Takeover Protections. The Company and
its board of directors have taken all necessary action, if any, in order to
render inapplicable any control share acquisition, business combination, poison
pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Certificate of Incorporation, the laws of the
state of its incorporation or the laws of any other state which is or could
become applicable to the Buyers as a result of the transactions contemplated by
this Agreement, including, without limitation, the Company's issuance of the
Securities and the Buyers' ownership of the Securities. The Company specifically
represents, warrants and agrees that, in accordance with Section 1(a) of the
Rights Plan, regardless of the number of Conversion Shares, Warrant Shares and
Interest Shares of which each Buyer is deemed the Beneficial Owner (as defined
in the Rights Plan), none of the Buyers is intended to be or will be deemed to
be an Acquiring Person within the meaning of the Rights Plan because of the
acquisition of the Securities (including the Conversion Shares, the Warrant
Shares and the Interest Shares) pursuant to this Agreement, and the acquisition
of the Securities (including the Conversion Shares, the Warrant Shares and the
Interest Shares) pursuant to this Agreement, shall not, under any circumstances,
trigger a Stock Acquisition Date within the meaning of the Rights Plan;
provided, however, that only Securities (including the Conversion Shares, the
Warrant Shares and the Interest Shares) acquired pursuant to this Agreement
shall be deemed excluded from the number of shares of Common Stock deemed
beneficially owned by each Buyer in determining whether such Buyer is an
Acquiring Person within the meaning of the Rights Plan.
u. Rights Agreement. Except for the Rights Plan, the
Company has not adopted a shareholder rights plan or similar arrangement
relating to accumulations of beneficial ownership of Common Stock or a change in
control of the Company.
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v. No Other Agreements. The Company has not, directly or
indirectly, made any agreements with any Buyers relating to the terms or
conditions of the transactions contemplated by the Transaction Documents except
as set forth in the Transaction Documents.
w. Investment Company Status. The Company is not, and
upon consummation of the sale of the Securities will not be, an "investment
company," a company controlled by an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company" as such terms are defined in the Investment Company Act of 1940, as
amended.
x. Foreign Corrupt Practices. Neither the Company nor
any of its Subsidiaries, nor any director, executive officer, authorized 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 or any Subsidiary
used any corporate funds for any unlawful contribution, gift, entertainment or
other unlawful expenses relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; violated or is in violation of any provision of
the U.S. Foreign Corrupt Practices Act of 1977; or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment to any foreign or
domestic government official or employee.
y. Indenture. The Company has delivered to the Buyers
true, correct and complete copies of all notices, certificates, communications
and other instruments that have been delivered by the Company, its affiliates or
any of their respective officers, employees, agents or advisors pursuant to the
1996 Indenture with respect to the Subordinated Notes. The conversion price of
the Subordinated Notes in effect as of the date hereof is $19.22. Neither the
1996 Indenture nor the Subordinated Notes have been amended or modified in any
material manner since the original issuance of the Subordinated Notes. No
redemption, repurchase or defeasance of any of the Subordinated Notes has
occurred since the original issuance of the Subordinated Notes.
4. COVENANTS.
a. Reasonable Best Efforts. Each party shall use its
reasonable best efforts to timely satisfy each of the conditions to be satisfied
by it as provided in Sections 6 and 7 of this Agreement.
b. Form D and Blue Sky. The Company agrees to file a
Form D with respect to the Securities as required under Regulation D and to
provide a copy thereof to each Buyer promptly after such filing. The Company
shall, on or before the Closing Date, take such action as the Company shall
reasonably determine is necessary in order to obtain an exemption for, or to
qualify the Securities for, sale to the Buyers at the Closing pursuant to this
Agreement under applicable securities or "Blue Sky" laws of the states of the
United States, and shall provide evidence of any such action so taken to the
Buyers on or prior to the Closing Date. The Company shall make all filings and
reports relating to the offer and sale of the Securities required under
applicable securities or "Blue Sky" laws of the states of the United States
following the Closing Date.
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c. Reporting Status. Until the later of (i) the date
which is one year after the date as of which the Investors (as that term is
defined in the Registration Rights Agreement) may sell all of the Conversion
Shares and the Warrant Shares without restriction pursuant to Rule 144(k)
promulgated under the 1933 Act (or successor thereto) and (ii) the date on which
(A) the Investors shall have sold all the Conversion Shares and the Warrant
Shares and (B) none of the Debentures or Warrants is outstanding (the "Reporting
Period"), the Company shall timely file all reports required to be filed with
the SEC pursuant to the 1934 Act, and the Company shall not terminate its status
as an issuer required to file reports under the 1934 Act even if the 1934 Act or
the rules and regulations thereunder would otherwise permit such termination.
d. Use of Proceeds. The Company will use the proceeds
from the sale of the Debentures and the Warrants for working capital purposes.
e. Financial Information. The Company agrees to send the
following to each Investor during the Reporting Period: (i) within ten (10) days
after the filing thereof with the SEC, a copy of its Annual Reports on Form
10-K, its Quarterly Reports on Form 10-Q, any Current Reports on Form 8-K and
any registration statements (other than on Form S-8) or amendments thereto filed
pursuant to the 1933 Act, provided that if any such report is filed with the SEC
through XXXXX and is available to the Investors via XXXXX then no such
deliveries shall be required; and (ii) copies of any notices and other
information made available or given to the stockholders of the Company
generally, contemporaneously with the making available or giving thereof to the
stockholders. The Company agrees to promptly include each Investor on the
Company's distribution list for electronic and/or fax delivery of all press
releases issued by the Company.
f. Reservation of Shares. The Company shall take all
action necessary to at all times have authorized, and reserved for the purpose
of issuance, no less than 11,792,404 shares of Common Stock to provide for the
issuance of the Conversion Shares upon conversion of all of the Debentures, the
Interest Shares and the Warrant Shares upon exercise of all of the Warrants
(without regard to any limitations on conversions or exercise) and up to 293,805
shares of Common Stock to provide for the exercise of GKM Warrants.
g. Listing. The Company shall, in the time and manner
required by the Principal Market, promptly secure the listing of all of the
Registrable Securities (as defined in the Registration Rights Agreement) upon
each national securities exchange and automated quotation system, if any, upon
which shares of Common Stock are then listed (subject to official notice of
issuance) and shall use reasonable best efforts to maintain, so long as any
other shares of Common Stock shall be so listed, such listing of all Registrable
Securities from time to time issuable under the terms of the Transaction
Documents. So long as any Securities are outstanding, the Company shall maintain
the Common Stock's authorization for quotation on the Nasdaq National Market
("NASDAQ") or listing on the New York Stock Exchange ("NYSE") (as applicable,
the "Principal Market"). Until six (6) years from the date of this Agreement and
other than in connection with Organic Changes (as defined in the Warrants),
neither the Company nor any of its Subsidiaries shall take any action which
would be reasonably expected to result in the delisting or suspension of the
Common Stock from the Principal Market. The
- 15 -
Company shall pay all fees and expenses in connection with satisfying its
obligations under this Section 4(g).
h. Filing of Form 8-K. On or before 8:30 a.m., New York
City time, on the Business Day following the Closing Date, the Company shall
file a Current Report on Form 8-K with the SEC describing the terms of the
transactions contemplated by the Transaction Documents and including as exhibits
to such Current Report on Form 8-K this Agreement, the form of Debenture, the
form of Warrants, the form of Indenture, the form of Pledge and Security
Agreement, the form of Option Agreement and the Registration Rights Agreement,
and the schedules hereto and thereto in the form required by the 1934 Act. For
greater certainty and without limiting the foregoing, the Company acknowledges
and agrees that it will not issue any press releases or make any public
statement relating to the transactions contemplated by the Transaction Documents
or the entering into of this Agreement prior to filing such Current Report on
Form 8-K. "Business Day" means any day other than Saturday, Sunday or other day
on which commercial banks in The City of New York are authorized or required by
law to remain closed.
i. Corporate Existence. So long as a Buyer beneficially
owns any Securities, the Company shall maintain its corporate existence and
shall not sell all or substantially all of the Company's assets, except in the
event of a merger or consolidation or sale of all or substantially all of the
Company's assets, where the surviving or successor entity in such transaction
(i) assumes the Company's obligations hereunder and under the Transaction
Documents and (ii) such surviving or successor entity or its parent into whose
stock the Debentures and Warrants will be convertible or exercisable is a
publicly traded corporation whose common stock is listed for trading on or
quoted on NYSE or NASDAQ.
j. Pledge of Securities. The Company acknowledges and
agrees that the Securities may be pledged by an Investor (as defined in the
Registration Rights Agreement) in connection with a bona fide margin agreement
or other loan or financing arrangement that is secured by the Securities. The
pledge of Securities shall not be deemed to be a transfer, sale or assignment of
the Securities hereunder, and no Investor effecting such a pledge of Securities
shall be required to provide the Company with any notice thereof or otherwise
make any delivery to the Company pursuant to this Agreement or any other
Transaction Document, including, without limitation, Section 2(f) of this
Agreement; provided that an Investor and its pledgee shall be required to comply
with the provisions of Section 2(f) hereof in order to effect a sale, transfer
or assignment of Securities to such pledgee. The Company hereby agrees to
execute and deliver such reasonable documentation as a pledgee of the Securities
may reasonably request in connection with a pledge of the Securities to such
pledgee by an Investor.
k. Expenses. Subject to Section 9(l) below, at the
Closing, the Company shall pay an expense allowance of up to $115,000 (of which
$30,000 has previously been paid to Portside Growth & Opportunity Fund (a
Buyer)) which amount, less any amount paid prior to the Closing, shall be
withheld by such Buyer from its Purchase Price to be paid at the Closing.
l. Good Standing. At the Closing, the Company shall
deliver a good standing certificate (or copy thereof) to each of the Buyers,
certifying the Company's
- 16 -
qualification to do business and its good standing in the States of California
and Delaware as certified by the Secretaries of State of the States of
California and Delaware.
m. Additional Debentures. For so long as any Buyer
beneficially owns any Securities, the Company will not issue any Debentures
other than to the Buyers as contemplated hereby.
n. Violations of Law. The business of the Company and
its Subsidiaries will not be conducted in violation of any law, ordinance or
regulation of any governmental entities, except where such violations would not
result, either individually or in the aggregate, in a Material Adverse Effect.
o. Congress Facility. On or before 8:00 p.m., New York
City time, on April 26, 2002, either (a) the Company and Congress Financial
Corporation (Western), Sensory Science Corporation and California Audio Labs,
LLC shall have entered into Amendment Number Eight to the Second Amended and
Restated Loan and Security Agreement dated as of August 19, 1998 (the "Congress
Facility"), in a form reasonably satisfactory to the Buyers, or (b) the Company
shall have delivered evidence, in a form reasonably satisfactory to the Buyers,
that the Congress Facility has been terminated and that all obligations under
the Congress Facility have been paid in full.
5. TRANSFER AGENT INSTRUCTIONS.
The Company shall issue irrevocable instructions to its transfer
agents, and any subsequent transfer agent, to issue certificates or credit
shares to the applicable balance accounts at DTC, registered in the name of each
Buyer or its respective nominee(s), for the Conversion Shares and the Warrant
Shares in such amounts as specified from time to time by each Buyer to the
Company upon conversion of the Debentures or exercise of the Warrants, as
applicable (the "Irrevocable Transfer Agent Instructions"), a form of which is
attached as Exhibit F hereto. Prior to registration of the Conversion Shares and
the Warrant Shares under the 1933 Act, all such certificates shall bear the
restrictive legend specified in Section 2(g) of this Agreement. The Company
warrants that no instruction other than the Irrevocable Transfer Agent
Instructions referred to in this Section 5 and stop transfer instructions to
give effect to Section 2(f) hereof (in the case of the Conversion Shares and the
Warrant Shares, prior to registration of the Conversion Shares and the Warrant
Shares under the 0000 Xxx) will be given by the Company to its transfer agent
and that the Securities shall otherwise be freely transferable on the books and
records of the Company as and to the extent provided in this Agreement, the
Debentures, the Warrants and the Registration Rights Agreement. If a Buyer
provides the Company with an opinion of counsel, in a form reasonably acceptable
to the Company and its counsel, to the effect that a public sale, assignment or
transfer of Securities may be made without registration under the 1933 Act or
the Buyer provides the Company with reasonable assurances that the Securities
can be sold pursuant to Rule 144 without any restriction as to the number of
securities acquired as of a particular date that can then be immediately sold,
the Company shall permit the transfer, and, in the case of the Conversion Shares
and the Warrant Shares, promptly instruct its transfer agent to issue one or
more certificates, or credit shares to one or more balance accounts at DTC, in
such name and in such denominations as specified by such Buyer and without any
restrictive legend. The Company acknowledges that a breach by it of its
obligations hereunder will cause
- 17 -
irreparable harm to the Buyers by vitiating the intent and purpose of the
transaction contemplated hereby. Accordingly, the Company acknowledges that the
remedy at law for a breach of its obligations under this Section 5 will be
inadequate and agrees, in the event of a breach or threatened breach by the
Company of the provisions of this Section 5, that the Buyers shall be entitled,
in addition to all other available remedies, to an order and/or injunction
restraining any breach and requiring immediate issuance and transfer, without
the necessity of showing economic loss and without any bond or other security
being required.
6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.
The obligation of the Company to issue and sell the
Debentures and the Warrants to each Buyer at the Closing is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for the Company's sole benefit
and may be waived by the Company at any time in its sole discretion by providing
each Buyer with prior written notice thereof:
(i) Such Buyer shall have executed each of the
Transaction Documents to which it is a party and delivered the
same to the Company.
(ii) Such Buyer shall have delivered to the
Company the purchase price (less, in the case of Portside Growth
& Opportunity Fund, the amounts withheld by a Buyer pursuant to
Section 4(k)) for the Debentures and the Warrants being
purchased by such Buyer at the Closing, by wire transfer of
immediately available funds pursuant to the wire instructions
provided by the Company.
(iii) The representations and warranties of such
Buyer shall be true and correct as of the date when made and as
of the Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date
(which shall be true and correct as of such date)), and such
Buyer shall have performed, satisfied and complied with the
covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by such
Buyer at or prior to the Closing Date.
7. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE.
The obligation of each Buyer hereunder to purchase the
Debentures and the Warrants from the Company at the Closing is subject to the
satisfaction, at or before the Closing Date, of each of the following
conditions, provided that these conditions are for each Buyer's sole benefit and
may be waived by such Buyer at any time in its sole discretion by providing the
Company with prior written notice thereof:
(i) The Company shall have executed each of the
Transaction Documents and delivered the same to such Buyer.
(ii) The Common Stock (x) shall be designated
for quotation or listed on the Principal Market and (y) shall
not have been suspended by the SEC or the Principal Market from
trading on the Principal Market nor shall suspension by the SEC
or the Principal Market have been threatened either (A) in
writing by the SEC or the
- 18 -
Principal Market or (B) by falling below the minimum listing
maintenance requirements of the Principal Market.
(iii) The representations and warranties of the
Company shall be true and correct as of the date when made and
as of the Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date
(which shall be true and correct as of such date)) and the
Company shall have performed, satisfied and complied with the
covenants, agreements and conditions required by the Transaction
Documents to be performed, satisfied or complied with by the
Company at or prior to the Closing Date. Such Buyer shall have
received a certificate, executed by the Chief Executive Officer,
the Chief Financial Officer or the Chief Operating Officer of
the Company, dated as of the Closing Date, to the foregoing
effect and as to such other matters as may be reasonably
requested by such Buyer, including, without limitation, an
update as of the Closing Date regarding the representation
contained in Section 3(c) above.
(iv) Such Buyer shall have received the opinion
of Pillsbury Winthrop LLP, dated as of the Closing Date, in the
form of Exhibit G, attached hereto and the opinion of Xxx and
Li, dated as of the Closing Date, in the form of Exhibit H,
attached hereto.
(v) The Company shall have executed and
delivered to such Buyer the Debentures and Warrants (in such
denominations as such Buyer shall request) for the Debentures
and the Warrants being purchased by such Buyer at the Closing.
(vi) The Board of Directors of the Company shall
have adopted resolutions consistent with Section 3(b) above (the
"Resolutions").
(vii) As of the Closing Date, the Company shall
have reserved out of its authorized and unissued Common Stock,
solely for the purpose of effecting the conversion of the
Debentures, payment of Interest Shares and the exercise of the
Warrants, 11,792,404 shares of its Common Stock and shall have
reserved out of its authorized and unissued Common Stock, solely
for the purpose of effecting the exercise of the GKM Warrants,
up to 293,805 shares of its Common Stock.
(viii) The Irrevocable Transfer Agent
Instructions, in the form of Exhibit E attached hereto, shall
have been delivered to and acknowledged in writing by the
Company's transfer agent.
(ix) The Company shall have delivered to such
Buyer a certificate (or copy thereof) evidencing the
incorporation and good standing of the Company and each
Subsidiary in such entity's state of incorporation or
organization issued by the Secretary of State of such state of
incorporation or organization as of a date within ten days of
the Closing Date.
(x) The Company shall have delivered to such
Buyer a certified copy (or copy thereof) of the Certificate of
Incorporation as certified by the
- 19 -
Secretary of State of the State of Delaware as of a date within
ten (10) days of the Closing Date.
(xi) The Company shall have delivered to such
Buyer a secretary's certificate, dated as of the Closing Date,
certifying as to (A) the Resolutions, (B) the Certificate of
Incorporation and (C) the By-laws, each as in effect at the
Closing.
(xii) The Company shall have made all filings
required to be made prior to the Closing Date under all
applicable federal and state securities laws necessary to
consummate the issuance of the Securities pursuant to this
Agreement in compliance with such laws.
(xiii) The Company shall have delivered to such
Buyer a letter from the Company's transfer agent certifying the
number of shares of Common Stock outstanding as of a date within
five (5) days of the Closing Date.
(xiv) The Company shall have delivered to the
Buyers such other documents relating to the transactions
contemplated by the Transaction Documents as the Buyers or their
counsel may reasonably request.
8. INDEMNIFICATION. In consideration of each Buyer's execution
and delivery of the Transaction Documents and acquiring the Securities
thereunder and in addition to all of the Company's other obligations under the
Transaction Documents, the Company shall defend, protect, indemnify and hold
harmless each Buyer and each permitted assignee under the Transaction Documents
and all of their stockholders, officers, directors, employees and direct or
indirect investors and any of the foregoing persons' agents or other
representatives (including, without limitation, those retained in connection
with the transactions contemplated by this Agreement) (collectively, the
"Indemnitees") from and against any and all actions, causes of action, suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Indemnitee is a party to
the action for which indemnification hereunder is sought), and including
reasonable attorneys' fees and disbursements (the "Indemnified Liabilities"),
incurred by any Indemnitee as a result of, or arising out of, or relating to (a)
any misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
document contemplated hereby or thereby, (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
(c) the exercise or enforcement of any of the rights of the Buyers under the
Pledge Agreement and the enforcement of any rights under the Option Agreement,
including, without limitation, in connection with the enforcement of any
provision of any Investment Document (as defined in the Pledge Agreement) or the
foreclosure, sale, liquidation or other disposition of, or realization upon, the
Collateral (as defined in the Pledge Agreement), including, without limitation,
the transfer of the Collateral to the Buyers or the realization upon the Option
Shares (as defined in the Option Agreement); provided, however, that the parties
agree that the foregoing shall not apply to incidental expenses incurred prior
to actions relating to foreclosing on the pledge and the exercise of option, or
(d) any cause of action, suit or claim brought or made against such Indemnitee
(other than a cause of action, suit or claim which is (x) brought or made by the
Company and (y) is not a shareholder derivative
- 20 -
suit) and arising out of or resulting from (i) the execution, delivery,
performance or enforcement of the Transaction Documents or any other
certificate, instrument or document contemplated hereby or thereby, (ii) any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of the issuance of the Securities or (iii) the
status of such Buyer or holder of the Securities as an investor in the Company.
To the extent that the foregoing undertaking by the Company may be unenforceable
for any reason, the Company shall make the maximum contribution to the payment
and satisfaction of each of the Indemnified Liabilities which is permissible
under applicable law. Except as otherwise set forth herein, the mechanics and
procedures with respect to the rights and obligations under this Section 8 shall
be the same as those set forth in Sections 6(a) and (d) of the Registration
Rights Agreement, including, without limitation, those procedures with respect
to the settlement of claims and the Company's rights to assume the defense of
claims.
9. MISCELLANEOUS.
a. Governing Law; Jurisdiction; Jury Trial. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision or
rule (whether of the State of New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
New York. Each party hereby irrevocably submits to the non-exclusive
jurisdiction of the state and federal courts sitting in The City of New York,
Borough of Manhattan, for the adjudication of any dispute hereunder or in
connection herewith or with any transaction contemplated hereby or discussed
herein, and hereby irrevocably waives, and agrees not to assert in any suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
b. Counterparts. This Agreement may be executed in two
or more identical counterparts, all of which shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.
c. Headings. The headings of this Agreement are for
convenience of reference and shall not form part of, or affect the
interpretation of, this Agreement.
- 21 -
d. Severability. If any provision of this Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
e. Entire Agreement; Amendments. This Agreement
supersedes all other prior oral or written agreements between each Buyer, the
Company, their affiliates and persons acting on their behalf with respect to the
matters discussed herein, and this Agreement and the instruments referenced
herein contain the entire understanding of the parties with respect to the
matters covered herein and therein and, except as specifically set forth herein
or therein, neither the Company nor any Buyer makes any representation,
warranty, covenant or undertaking with respect to such matters. No provision of
this Agreement may be amended or waived other than by an instrument in writing
signed by the Company and the holders of at least a majority of the outstanding
principal amount of the Debentures. No such amendment shall be effective to the
extent that it applies to less than all of the holders of the Debentures then
outstanding. No consideration shall be offered or paid to any person to amend or
consent to a waiver or modification of any provision of any of the Transaction
Documents unless the same consideration also is offered to all of the parties to
the Transaction Documents.
f. Notices. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered: (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by facsimile
(provided confirmation of transmission is mechanically or electronically
generated and kept on file by the sending party); or (iii) one (1) Business Day
after deposit with a nationally recognized overnight delivery service, in each
case properly addressed to the party to receive the same. The addresses and
facsimile numbers for such communications shall be:
- 22 -
If to the Company:
SONICblue Incorporated
0000 Xxxxxxx Xxxxxxx Xxxxxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: General Counsel
With a copy to, which shall not constitute notice:
Pillsbury Winthrop LLP
0000 Xxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. del Xxxxx
If to the Transfer Agent:
EquiServe Trust Company, N.A.
Shareholder Services
000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx XxXxxx
If to a Buyer, to it at the address and facsimile number
set forth on the Schedule of Buyers, with copies to such Buyer's representatives
as set forth on the Schedule of Buyers, or at such other address and/or
facsimile number and/or to the attention of such other person as the recipient
party has specified by written notice given to each other party five (5) days
prior to the effectiveness of such change. Written confirmation of receipt (A)
given by the recipient of such notice, consent, waiver or other communication,
(B) mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a nationally recognized overnight
delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.
g. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns, including any purchasers of the Debentures and Warrants.
The Company shall not assign this Agreement or any rights or obligations
hereunder without the prior written consent of the holders of at least a
majority of the outstanding principal amount of the Debentures including by
merger or consolidation, except pursuant to a change of control in accordance
with the terms of Section 13.6 of the Indenture with respect to which the
Company is in compliance with the terms of the
- 23 -
Indenture and Section 4(i) of this Agreement. A Buyer may assign some or all of
its rights hereunder without the consent of the Company; provided, however, that
the transferee has agreed in writing to be bound by the applicable provisions of
this Agreement. Any Buyer shall be entitled to pledge the Securities in
connection with a bona fide margin account or other loan secured by the
Securities.
h. No Third Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto and their respective permitted
successors and assigns, and is not for the benefit of, nor may any provision
hereof be enforced by, any other person.
i. Survival. Unless this Agreement is terminated under
Section 9(l), the representations and warranties of the Company and the Buyers
contained in Sections 2 and 3, the agreements and covenants set forth in
Sections 4, 5 and 9, and the indemnification provisions set forth in Section 8,
shall survive the Closing. Each Buyer shall be responsible only for its own
representations, warranties, agreements and covenants hereunder.
j. Publicity. The Company and each Buyer shall have the
right to approve before issuance any press releases or any other public
statements with respect to the transactions contemplated hereby; provided,
however, that the Company shall be entitled, without the prior approval of any
Buyer, to make any press release or other public disclosure with respect to such
transactions in the from as is required by applicable law and regulations
(although the Company shall use reasonable best efforts to consult with each
Buyer in connection with any such press release or other public disclosure prior
to its release and shall be provided with a copy thereof).
k. Further Assurances. Each party shall do and perform,
or cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and
documents, as the other party may reasonably request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
l. Termination. In the event that the Closing shall not
have occurred with respect to a Buyer on or before five (5) Business Days from
the date hereof due to the Company's or such Buyer's failure to satisfy the
conditions set forth in Sections 6 and 7 above (and the nonbreaching party's
failure to waive such unsatisfied condition(s)), the nonbreaching party shall
have the option to terminate this Agreement with respect to such breaching party
at the close of business on such date without liability of any party to any
other party; provided, however, that if this Agreement is terminated pursuant to
this Section 9(l), the Company shall remain obligated to reimburse any
nonbreaching Buyer for the expenses described in Section 4(k) above.
m. Placement Agent. The Company acknowledges that it has
engaged GKM and Banc of America LLC to serve as a placement agent in connection
with the sale of the Debentures and the Warrants for which the total
compensation payable to such placement agent is set forth on Schedule 9(m). The
Company shall be responsible for the payment of any placement agent's fees,
financial advisory fees, or brokers' commissions (other than for persons engaged
by any Buyer or its investment advisor) relating to or arising out of the
transactions
- 24 -
contemplated hereby. The Company shall pay, and hold each Buyer harmless
against, any liability, loss or expense (including, without limitation,
attorney's fees and out-of-pocket expenses) arising in connection with any such
claim.
n. No Strict Construction. The language used in this
Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against
any party.
o. Remedies. Each Buyer and each permitted assignee
under the Transaction Documents shall have all rights and remedies set forth in
the Transaction Documents and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the
rights which such holders have under any law. Any person having any rights under
any provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.
p. Payment Set Aside. To the extent that the Company
makes a payment or payments to any Buyer hereunder or pursuant to any of the
other Transaction Documents, or the Buyers enforce or exercise their rights
hereunder or thereunder, and such payment or payments or the proceeds of such
enforcement or exercise or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, recovered from, disgorged
by or are required to be refunded, repaid or otherwise restored to the Company,
a trustee, receiver or any other person under any law (including, without
limitation, any bankruptcy law, state or federal law, common law or equitable
cause of action), then to the extent of any such restoration the obligation or
part thereof originally intended to be satisfied shall be revived and continued
in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.
[Remainder of this page intentionally left blank]
- 25 -
IN WITNESS WHEREOF, the Buyers and the Company have caused this
Securities Purchase Agreement to be duly executed as of the date first written
above.
COMPANY:
SONICBLUE INCORPORATED
By: /s/ XXXX X. XXXX
--------------------------
Name: Xxxx X. Xxxx
Title: Chief Operating Officer
[Signatures of Buyers on the Following Page]
- 26 -
[SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT]
BUYERS:
PORTSIDE GROWTH AND OPPORTUNITY
FUND
By: /s/ XXXXXXX X. XXXXXXX
-----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Managing Officer
SMITHFIELD FIDUCIARY LLC
By: /s/ XXXX X. CHILL
-----------------------------
Name: Xxxx X. Chill
Title: Authorized Signatory
CITADEL EQUITY FUND LTD.
By: /s/ XXXXXXX X. SIMPLER
-----------------------------
Name: Xxxxxxx X. Simpler
Title: Vice President
- 27 -
SCHEDULE OF BUYERS
Principal Purchase
Amount Price Investor's Representatives'
Investor Address of of Number of Address
Investor Name and Facsimile Number Debentures Debentures Warrants and Facsimile Number
----------------- --------------------------------- ----------- ----------- --------- ----------------------------
Portside Growth & c/o Ramius Capital Group, L.L.C. $25,000,000 $20,750,000 2,500,000 Xxxxxxx Xxxx & Xxxxx LLP
Opportunity Fund, 000 Xxxxx Xxxxxx, 00xx Xxxxx 000 Xxxxx Xxxxxx
Xxx. Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx Attn: Xxxxxxx Xxxxx, Esq.
Xxxxxx Xxxxxxx Telephone: (000) 000-0000
Telephone: (000) 000-0000 Facsimile: (000) 000-0000
Facsimile: (000) 000-0000
Residence: Cayman Islands
Smithfield c/o Highbridge Capital Management, $25,000,000 $20,750,000 2,500,000 Xxxxxxx Xxxx & Xxxxx LLP
Fiduciary LLC LLC 000 Xxxxx Xxxxxx
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx Xxx Xxxx, XX 00000
Xxx Xxxx, XX 00000 Attn: Xxxxxxx Xxxxx, Esq.
Attention: Xxx X. Xxxxxx Telephone: (000) 000-0000
Xxxx X. Chill Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Residence: Cayman Islands
Citadel Equity
Fund Ltd. c/o Citadel Investment Group, L.L.C. $25,000,000 $20,750,000 2,500,000 Xxxxx Xxxxxxxx
000 Xxxx Xxxxxxxxxx Xxxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000 000 X. Xxxxxx Xxxxxx
Attention: Xxxxxxx X. Simpler Xxxxxxx, Xxxxxxxx 00000-0000
Telephone: (000) 000-0000 Attention: Xxxxxx X.
Facsimile: (000) 000-0000 Xxxxxxxx, Esq.
Residence: Cayman Islands Telephone: (000) 000-0000
Facsimile: (000) 000-0000
