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Exhibit 4.1
March 18, 1997
STOCK PURCHASE AND REGISTRATION RIGHTS AGREEMENT
DATED AS OF MARCH 18, 1997
BETWEEN
INTERNATIONAL BUSINESS MACHINES CORPORATION
AND
SILICON VALLEY GROUP, INC.
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STOCK PURCHASE AGREEMENT, dated as of March 18, 1997
(the "Agreement"), between INTERNATIONAL BUSINESS
MACHINES CORPORATION, a New York corporation
("Seller"), and SILICON VALLEY GROUP, INC., a Delaware
corporation (the "Company").
WHEREAS, Seller is the record holder of 600,000 shares of SVG
Lithography Systems, Inc.'s Common Stock, $.0l par value per share (the "Common
Stock"); and
WHEREAS, the Company is the record holder of 9,400,000 shares of SVG
Lithography Systems, Inc.'s common stock, $.01 par value per share; and
WHEREAS, Seller desires to sell and the Company desires to purchase
the Common Stock upon the terms and conditions hereinafter provided;
NOW, THEREFORE, it is hereby agreed as follows:
1. CERTAIN DEFINITIONS.
(a) As used in this Agreement, the following terms shall have the
meanings specified below:
(i) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder.
(ii) "NASD" shall mean the National Association of Securities
Dealers, Inc.
(iii) "NASDAQ" shall mean the National Association of Securities
Dealers Automated Quotation System.
(iv) "OPERATIVE AGREEMENTS" shall mean this Agreement, the Agreement
for Payment in Connection with Development Agreement among Seller, the Company
and SVG Lithography, Inc. ("SVGL") of even date herewith (the "Development
Agreement") and the Stockholders Agreement among Seller, the Company and SVGL of
even date herewith.
(v) "PERSON" shall mean any individual, firm, corporation,
partnership, trust, joint venture or other entity, and shall include any
successor (by merger or otherwise) of such entity.
(vi) "REGISTRATION SHARES" means (A) the Shares of common stock of
the Company issued to Seller pursuant to the Agreement for Payment in connection
with
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Development Agreement, among Seller, the Company and SVG Lithography, Inc.
("SVGL") of even date herewith (the "Development Agreement"), which number of
shares of common stock shall be calculated by dividing $10,000,000 (ten million
dollars) by a share price equal to the average closing sales price (or the
average closing bid price if no such sales were reported) as quoted on the
NASDAQ for the five business days beginning on March 11, 1997 and ending on
March 17, 1997; and (B) any securities issued or issuable with respect to any
common stock referred to in clause (A) of this definition by way of stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise,
which Registration Shares shall be registrable immediately upon the demand of
Seller pursuant to the terms of Section 7 hereof.
(vii) "SEC" shall mean the Securities and Exchange Commission or any
successor commission or agency having similar powers.
(viii) "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, and the rules and regulations thereunder.
(ix) "TAX" OR "TAXES" means all Federal, state, local and foreign
taxes, assessments and other governmental charges, including (A) taxes based
upon or measured by gross receipts, income, profits, sales, use or occupation
and (B) value added, ad valorem, transfer, franchise, withholding with (C) all
interest, penalties and additions imposed with respect to such amounts and (D
any obligations under any agreements or arrangements with any other person with
respect to such amounts.
(b) The following terms are defined in the specified sections of
this Agreement:
DEFINED TERM SECTION DEFINED IN
------------ ------------------
Common Stock First Recital Clause
Company Balance Sheet 4(i)
Company SEC Documents 4(h)
Demand Registration 7(a)
Encumbrances 3(b)
Piggyback Registration 7(b)
Purchase Consideration 2(a)
Registration Statement 7(i)(i)
Securities Laws 4(g)(i)
2. PURCHASE AND SALE OF COMMON STOCK.
(a) Seller hereby sells, conveys, transfers and delivers to the
Company, and the Company hereby purchases from Seller, the Common Stock for the
purchase consideration set forth in Section 2(b), below (the "Purchase
Consideration").
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(b) The Purchase Consideration shall be $3,000,000 (three million
dollars).
3. REPRESENTATIONS AND COVENANTS OF SELLER. Seller hereby
represents, warrants and covenants to the Company as follows:
(a) ORGANIZATION AND GOOD STANDING. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State of
New York.
(b) TITLE TO COMMON STOCK. Seller is the record holder and sole
beneficial owner of the Common Stock being sold pursuant to this Agreement and
such Common Stock is free and clear of any claim, lien, pledge, option, charge,
security interest or encumbrance of any nature whatsoever (collectively
"Encumbrances") with respect to Seller.
(c) AUTHORITY; EXECUTION AND DELIVERY. Seller has full power and
authority to enter into the Operative Agreements and to sell the Common Stock in
accordance with the terms hereof. The execution, delivery and performance of the
Operative Agreements have been duly authorized by Seller and no other actions on
the part of Seller are required. The Operative Agreements have been duly
executed and delivered by Seller and constitute the legal, valid and binding
obligation of Seller, enforceable against Seller in accordance with their
respective terms.
(d) CONSENTS; NO CONFLICTS. Neither the execution and delivery of
the Operative Agreements, the consummation by Seller of the transactions
contemplated by this Agreement nor compliance by Seller with any of the
provisions hereof will (with or without the giving of notice or the passage of
time), except where any such violation, conflict or lack of consent would not
have a material adverse effect on the business of Seller or the consummation by
Seller of the transactions contemplated hereby:
(i) violate or conflict with any provision of the Certificate of
Incorporation or By-Laws of Seller or any agreement, instrument, judgment,
decree, statute or regulation applicable to Seller or any assets or properties
of Seller;
(ii) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Seller or any assets or properties of Seller; or
(iii) require the consent, approval, permission or other
authorization of or by, or designation, declaration, filing, registration or
qualification with, any court, arbitrator or governmental, administrative or
self-regulatory authority or any other third party whatsoever.
(e) LITIGATION. There is no litigation, proceeding, labor dispute,
arbitral action or government investigation pending or, so far as known to
Seller,
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threatened against Seller with respect to the Common Stock or the Operative
Agreements which if adversely determined could prohibit or prevent Seller from
consummating the transactions contemplated hereby and thereby. There are no
decrees, injunctions or orders of any court or governmental department or agency
outstanding against Seller with respect to the Common Stock which prohibit or
prevent Seller from consummating the transactions contemplated hereby.
(f) NO BROKERS. Seller has not entered into and will not enter into
any agreement, arrangement or understanding with any person or firm which will
result in the obligation of the Company to pay any finder's fee, brokerage
commission or similar payment in connection with the transactions contemplated
hereby. Seller agrees to indemnify and hold the Company harmless from and
against any and all claims, liabilities or obligations with respect to any
finder's fees, brokerage commissions or similar payments asserted by any person
on the basis of any act or statement alleged to have been made by Seller.
(g) SECURITIES ACT.
The Registration Shares are being acquired for investment only and not
with a view to any public distribution thereof, and Seller will not offer to
sell or otherwise dispose of the Registration Shares so acquired in violation of
any of the registration requirements of the Securities Act or in violation of
any state securities laws.
4. REPRESENTATIONS AND COVENANTS OF THE COMPANY. The Company hereby
represents, warrants and covenants to Seller as follows:
(a) ORGANIZATION AND GOOD STANDING. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
(b) AUTHORITY; EXECUTION AND DELIVERY. The Company has full power and
authority to enter into the Operative Agreements, to purchase the Common Stock
and to issue, sell, convey, transfer and deliver the Registration Shares and
Purchase Consideration in accordance with the terms hereof and thereof. The
execution, delivery and performance of the Operative Agreements have been duly
authorized by the Company and no other actions on the part of the Company are
required. The Operative Agreements have been duly executed and delivered by the
Company and constitute the legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with their respective terms.
(c) CONSENTS; NO CONFLICTS. Neither the execution and delivery of the
Operative Agreements, the consummation by the Company of the transactions
contemplated hereby or thereby, nor compliance by the Company with any of the
provisions hereof or thereof will (with or without the giving of notice or the
passage of time) except where any such violation, conflict or lack of consent
would not have a
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material adverse effect on the business of the Company or the consummation by
the Company of the transactions contemplated hereby :
(i) violate or conflict with any provision of the Certificate of
Incorporation or By-Laws of the Company or any agreement, instrument, judgment,
decree, statute or regulation applicable to the Company or any assets or
properties of the Company;
(ii) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to the Company or any assets or properties of the Company;
or
(iii) require the consent, approval, permission or other authorization
of or by, or designation, declaration, filing, registration or qualification
with, any court, arbitrator or governmental, administrative or self-regulatory
authority or any other third party whatsoever.
(d) COMMON STOCK OF THE COMPANY. The Registration Shares are validly
issued, fully paid, and nonassessable and will not have been issued in violation
of, and will not be subject to, any preemptive or subscription rights and will
not result in the antidilution provisions of any security of the Company
becoming applicable.
(e) LITIGATION. There is no litigation, proceeding, labor dispute,
arbitral action or government investigation pending or, so far as known to the
Company, threatened against the Company with respect to the Common Stock, the
Registration Shares, the Purchase Consideration or the Operative Agreements
which if adversely determined could prohibit or prevent the Company from
consummating the transactions contemplated hereby or thereby. There are no
decrees, injunctions or orders of any court or governmental department or agency
outstanding against the Company with respect to the Common Stock, the
Registration Shares or the Purchase Consideration which prohibit or prevent the
Company from consummating the transactions contemplated hereby.
(f) NO BROKERS. The Company has not entered into and will not enter
into any agreement, arrangement or understanding with any person or firm which
will result in the obligation of Seller to pay any finder's fee, brokerage
commission or similar payment in connection with the transactions contemplated
hereby. The Company agrees to indemnify and hold Seller harmless from and
against any and all claims, liabilities or obligations with respect to any
finder's fees, brokerage commissions or similar payments asserted by any person
on the basis of any act or statement alleged to have been made by the Company.
(g) SECURITIES ACT.
(i) The Common Stock to be purchased by the Company pursuant to this
Agreement is being acquired for investment only and not with a view to any
public distribution thereof, and the Company will not offer to sell or otherwise
dispose of the Common Shares so acquired in violation of any of the registration
requirements of the
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Securities Act or in violation of any state securities laws. The certificates
evidencing the Common Stock will bear a legend substantially as follows:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 OR STATE SECURITIES LAWS (COLLECTIVELY "SECURITIES
LAWS") AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN COMPLIANCE WITH THE
SECURITIES LAWS.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A STOCKHOLDERS AGREEMENT, DATED AS OF MARCH 18, 1997, BY AND AMONG
SVG LITHOGRAPHY, INC., SILICON VALLEY GROUP, INC., INTERNATIONAL BUSINESS
MACHINES CORPORATION AND THE XXXXXX-XXXXX CORPORATION AND MAY NOT BE SOLD OR
TRANSFERRED EXCEPT IN ACCORDANCE THEREWITH. A COPY OF SUCH AGREEMENT IS ON FILE
AT THE PRINCIPAL EXECUTIVE OFFICES OF SVG LITHOGRAPHY, INC., AND SVG
LITHOGRAPHY, INC., WILL FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER OF THIS
CERTIFICATE UPON WRITTEN REQUEST AN WITHOUT CHARGE.
(ii) The Company is the current owner of approximately ninety four
percent (94%) of the outstanding shares of SVG Lithography, Inc. In addition,
the Company has been furnished access to the business records of SVG
Lithography, Inc. and such additional information and documents as the Company
has requested, and has been given the opportunity to meet with officials of SVG
Lithography, Inc. and to have such persons answer questions regarding the
affairs and condition of SVG Lithography, Inc.
(iii) The Company is an "accredited investor" within the meaning of
Rule 501(a) of Regulation D promulgated under the Securities Act and has
substantial experience in business and financial matters and is capable of
evaluating the merits and risks of its purchase of the Common Stock and is able
to bear the economic risks of its investment.
(h) SEC FILINGS; FINANCIAL STATEMENTS. The Company has furnished or
made available to Seller true and complete copies of its Annual Report on Form
10-K for the fiscal year ended September 30, 1996, and each report (including
any amendments and exhibits thereto and all material incorporated therein by
reference) filed under the Exchange Act by the Company with the SEC since such
date (the "Company SEC Documents"). None of the Company SEC Documents as of the
dates they were filed with the SEC contained, or as of the date of this
Agreement will contain, any untrue statement of a material fact or omitted, or
as of the date of this Agreement will omit, to state a material fact required to
be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading, except to the
extent corrected by a subsequently filed Company SEC Document filed before the
date hereof. Each of the consolidated balance sheets (including any related
notes) for the fiscal year or periods ending on September 30, 1996, or
thereafter included in the
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Company SEC Documents filed before the date hereof, is complete in all material
respects and fairly presents the financial position of the Company as of its
date and each of the consolidated statements of income and changes in financial
position (including any related notes) for the fiscal year or periods ending
September 30, 1996, or thereafter included in the Company SEC Documents, is
complete in all material respects and fairly presents the consolidated results
of operations or changes in financial position, as the case may be, of the
Company for the respective periods set forth therein, in accordance with, in the
case of audited financial statements, generally accepted accounting principles
consistently applied except as otherwise disclosed therein, or, in the case of
unaudited financial statements, generally accepted accounting principles
consistently applied, except as otherwise disclosed therein or as otherwise
permitted by Form 10-Q of the SEC. All of the Company SEC Documents are in
accordance with the books and records of the Company.
(i) UNDISCLOSED LIABILITIES. To the knowledge of the Company except
for liabilities (i) reflected on the most recent balance sheet included in the
Company SEC Documents filed before the date hereof (the "Company Balance
Sheet"), or reflected in the notes thereto; and (ii) incurred since the date of
the Company Balance Sheet in the ordinary course of business, the Company does
not have any liabilities or obligations of any nature (whether accrued,
absolute, fixed, contingent, known or unknown, unasserted or otherwise) in
either case which either individually or in the aggregate would have a material
adverse effect on the business of the Company.
(j) ABSENCE OF CERTAIN CHANGES. Except as set forth in a current
report on Form 8-K filed with the SEC before the date hereof, and except for
actions which individually or in the aggregate would not have a material adverse
effect on the business of the Company , since the date of the Company Balance
Sheet, the Company has not:
(i) suffered any change or changes which, individually or in the
aggregate, have had or may reasonably be expected to have a material adverse
effect on the business or, to the Company's knowledge, the prospects of the
Company;
(ii) borrowed or agreed to borrow funds or incurred, or assumed or
become subject to, whether directly or by way of guarantee or otherwise, any
liabilities except liabilities incurred in the ordinary course of business and
consistent with past practice;
(iii) paid, discharged or satisfied any liabilities other than the
payment, discharge or satisfaction in the ordinary course of business and
consistent with past practice of liabilities reflected or reserved against in
the Company Balance Sheet or incurred subsequent to the date thereof in the
ordinary course of business;
(iv) to the knowledge of the Company, the Company has not become
subject to any newly enacted or adopted law (whether before or after the date of
the
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Company Balance Sheet) which may reasonably be expected to have a material
adverse effect on the business or prospects of the Company;
(v) canceled or amended any debts or waived any claims or rights of
substantial value, or sold, transferred, or otherwise disposed of any of its
properties or assets (real, personal or mixed, tangible or intangible), except
in the ordinary course of business and consistent with past practice;
(vi) licensed, sold, transferred, pledged, modified, disclosed,
disposed of or permitted to lapse any right to use any intellectual property
right of the Company, except in the ordinary course of business and consistent
with past practice;
(vii) declared, paid or set aside for payment any dividend or other
distribution in respect of its capital stock or other securities or, directly or
indirectly, redeemed, purchased or otherwise acquired any shares of its capital
stock or other securities (other than repurchase of stock from terminated
employees);
(viii) made any change in any method of accounting or accounting
practice or any change in depreciation or amortization policies or rates
theretofore adopted;
(ix) entered into any other material transaction, contract, commitment
or arrangement other than in the ordinary course of business and consistent with
past practice;
(x) sold, leased or otherwise disposed of any substantial part of its
assets, except in the ordinary course of business and consistent with past
practice; or
(xi) agreed, whether in writing or otherwise, to take any action
described in this Section.
(k) DISCLOSURE. There is no fact which the Company has not disclosed
to Seller in writing which materially affects adversely or, so far as the
Company can now reasonably foresee, will materially affect adversely the ability
of the Company to perform its obligations under this Agreement, or its
obligations in respect of the Registration Shares.
(l) COMPLIANCE WITH APPLICABLE LAWS.
(i) The Company and each of its subsidiaries and each of their
respective properties, assets, operations and businesses, are in compliance in
all respect with all applicable statutes, laws, ordinances, rules and
regulations of any governmental authority and any filing requirements relating
thereto, except where the failure to be so in compliance would not have a
material adverse effect on the business of the Company.
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(ii) The Company and each of its subsidiaries has obtained all
permits, licenses and other authorizations which are required with respect to
the operation of its business and the ownership of its assets under applicable
Federal, state, local and foreign laws, including laws relating to pollution or
protection of the environment, except where the failure to have obtained such
permits, licenses and other authorizations would not have a material adverse
effect. The Company and each of its subsidiaries is in full compliance with all
terms and conditions of such permits, licenses and authorizations, except where
the failure to be so in compliance would not have a material adverse effect on
the business of the Company.
(iii) There are no past or present , conditions, circumstances,
activities, practices, incidents, actions or plans which may interfere with or
prevent compliance or, to the best of the Company's knowledge will not in the
future interfere with or prevent continued compliance by the Company or any of
its subsidiaries with any laws relating to pollution or protection of the
environment or with any regulation, code, plan, order, decree, judgment,
injunction, notice or demand letter issued, entered, promulgated or approved
thereunder, except where the failure to be so in compliance would not have a
material adverse effect on the business of the Company or the value of the
Registration Shares, or which may give rise to any common law or legal liability
of the Company or any of its subsidiaries, including liability under the
Comprehensive Environment Response, Compensation and Liability Act of 1980 or
similar state or local laws, or otherwise form the basis of any claim, action,
demand, suit proceeding, hearing, notice of violation, study or investigation
against or affecting the Company or any of its subsidiaries which would have a
material adverse effect on the business of the Company or the value of the
Registration Shares, based on or related to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling, or the
emission, discharge, release or threatened release into the environment, of any
pollutant, contaminant, chemical or industrial, toxic or hazardous substance or
waste.
(m) TAXES. Neither the Company nor any of its subsidiaries is
delinquent in the payment of any material Tax, except where the failure to pay
such Tax on a timely basis would not have a material adverse effect on the
business of the Company.. No material deficiencies for any Taxes have been
asserted in writing or assessed against the Company or any of its subsidiaries,
and no waivers of the time to assess any such Tax are in effect. As of the date
of execution of this Agreement, none of the Federal income tax returns of the
Company and its subsidiaries consolidated in such returns have been audited by
the United States Internal Revenue Service.
(n) ERISA. The Company is in compliance in all material respects with
the provisions of the Employee Retirement Income Security 'Act of 1974, as
amended, ("ERISA"), and the regulations and published interpretations
thereunder. No Reportable Event, as that term is defined in Section 4043(b) of
ERISA, has occurred with respect to any employee plan which is subject to the
provisions of Title IV of ERISA and which is maintained for employees of the
Company or any of its subsidiaries or any of its affiliates. There are no
unfunded vested liabilities under any such employee plan.
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(o) PATENTS, TRADEMARKS, ETC. The Company owns or has the right to use
all patents, trademarks, trade names, service marks and copyrights used in or
necessary for the conduct of its business, the lack of which would result in a
material adverse effect on the business of the Company or the value of the
Registration Shares, and is in compliance with all terms of any material license
of software or technology except where noncompliance would not have a material
adverse effect on the business of the Company.. Except where the failure to take
such action would not have a material adverse effect on the business of the
Company all of the patents, trademarks, trade names, service marks and
copyrights of the Company have been duly registered and filed in or issued by
the appropriate governmental authority in all appropriate jurisdictions , all
necessary affidavits or continuing use have been filed, and all necessary
maintenance fees have been paid to continue all such rights in effect. The
Company has:
(i) no notice or knowledge of any objection or claim being asserted by
any person with respect to the ownership, validity, enforceability or use of any
such patents, trademarks, trade names, service marks, copyrights, applications
therefor, or trade secrets; and
(ii) no reason to believe that any such right of the Company conflicts
with or infringes upon the rights of any other person.
(p) EMPLOYEES. To the Company's knowledge, no activity of any employee
of the Company or any of its subsidiaries as or while an employee of the Company
or any of its subsidiaries has caused a material violation of any term of any
material employment contract, confidentiality agreement, patent disclosure
agreement or any other similar contract or agreement or any term of any
agreement relating to such employee's employment with the Company or such
obligations to the Company with respect to confidentiality or nondisclosure,
and, to the best of the Company's knowledge, the continued employment by the
Company and its subsidiaries of their respective present employees will not
result in any such violation, except where such violation would not result in a
material adverse effect in a material adverse effect on the business of the
Company . The Company either has obtained, or will use its best efforts to
obtain within the next 30 days, from each person employed by the Company or any
of its subsidiaries in a technical position, including all officers of the
Company and its subsidiaries, an executed proprietary information agreement
restricting such person's right to disclose proprietary information of the
Company, its subsidiaries and their respective clients and an agreement relating
to the assignment of patents, copyrights, or inventions to the Company.
(q) LABOR RELATIONS. There is, except where such event would not
result in a material adverse effect on the business of the Company :
(i) no unfair labor practice complaint pending or asserted against the
Company or any of its subsidiaries before the National Labor Relations Board and
no
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grievance or arbitration proceeding arising out of or under collective
bargaining agreements is so pending or asserted;
(ii) no strike, labor dispute, slowdown or stoppage pending or
threatened against the Company or any of its subsidiaries;
(iii) no union representation question existing with respect to the
employees of the Company or any of its subsidiaries and, to the knowledge of the
Company, no union organizing activities are taking place; and
(iv) no existing collective bargaining agreement or other contract
with a labor union to which the Company or any of its subsidiaries is a party.
5. DELIVERIES. On the date and upon execution hereof, Seller will make
the delivery specified in clause (a) below and the Company will make the
deliveries specified in clause (b) below.
(a) Seller will deliver to the Company a certificate or certificates
evidencing the Common Stock being purchased by the Company hereby, free and
clear of Encumbrances, duly endorsed for transfer to the Company's order or
accompanied by stock powers duly executed to the Company's order and with all
requisite documentary or stock transfer tax stamps affixed.
(b) The Company will deliver to Seller:
(i) a certificate or certificates evidencing the Registration Shares
free and clear of Encumbrances, validly issued in the Seller's name and with all
requisite documentary or stock transfer tax stamps affixed;
(ii) a copy of the charter of the Company, certified as of a recent
date by the Secretary of State of Delaware;
(iii) a certificate dated the date hereof of the secretary, assistant
secretary or another appropriate authorized signatory of the Company certifying
as to:
(A) the absence of amendments since the date of the last amendment
shown on the official evidence as to such charter furnished pursuant to clause
(ii) above;
(B) resolutions, delegations or other written evidence of corporate
action of the appropriate authority within the Company and if applicable, the
stockholders of the Company, duly authorizing or ratifying its execution,
delivery and performance of this Agreement and the transactions contemplated by
this Agreement and the absence of other resolutions, delegations or such other
corporate action relating thereto;
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(C) the absence of proceedings for the merger, consolidation, sale of
all or substantially all assets, dissolution, liquidation or similar proceedings
with respect to the Company; and
(D) incumbency certificates, dated the date hereof, for the officers
or authorized signatories of the Company executing this Agreement and the other
documents and agreements contemplated by this Agreement. .
7. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION. After the date hereof, the Company shall,
subject to the provisions of Section 7(o), below, upon the written demand of
Seller, use its best efforts to effect the registration (the "Demand
Registration") under the Securities Act of such number of Registration Shares
held by Seller as shall be indicated in a written demand sent to the Company by
Seller; provided that:
(i) the Company shall be obligated to effect a total of no more than
five (5) Demand Registrations; and
(ii) a Demand Registration shall not count as such until it has become
effective, except that if, after it has become effective, the offering of
Registration Shares pursuant to such registration is interfered with by any stop
order, injunction or other order or requirement of the SEC or other governmental
authority, such registration shall be deemed not to have been effected unless
such stop order, injunction or other order or requirement shall subsequently
have been vacated or otherwise removed. If a Demand Registration is initiated by
Seller and the Company or any holder of registrable securities seeks to
participate in such registration on the basis of piggyback registration rights
or otherwise and the managing underwriters for such registration selected by
Seller advise the Company in writing that in their opinion the number of
securities requested to be included in the registration exceeds the number which
can be sold in the offering, the Company shall include in the registration
first, the number of Registration Shares Seller proposes to sell and then the
number of other securities that may be included in such registration shall be
allocated among all holders who are exercising their piggyback registration
rights in proportion as nearly as practicable to the respective amounts of
securities entitled to inclusion therein. Upon receipt of Seller's written
demand, the Company shall expeditiously (but in any event within 21 days) file a
registration statement under the Securities Act for the Registration Shares and
use its best efforts to have such registration declared effective as soon as
practicable after the filing thereof. Seller shall have the right to select the
underwriters, if any, for the Demand Registration.
(b) PIGGYBACK REGISTRATIONS.
(i) If the Company proposes to register any of its securities under
the Securities Act for sale for cash (otherwise than in connection with the
registration of securities issuable pursuant to an employee or director stock
option, stock purchase or
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similar plan or pursuant to a merger, exchange offer or a transaction of the
type specified in Rule 145(a) under the Securities Act), the Company shall give
Seller written notice of such proposed registration at least 30 days prior to
the filing of a registration statement. At the written request of Seller
delivered to the Company within 20 days after the receipt of the notice from the
Company, which request shall state the number of Registration Shares that Seller
wishes to sell or distribute publicly under the registration statement proposed
to be filed by the Company, the Company shall use its best efforts to include
such Registration Shares in such registration of securities (the "Piggyback
Registration").
(ii) If a Piggyback Registration is an underwritten primary
registration on behalf of the Company, and the managing underwriters thereof
advise the Company in writing that in their opinion the number of securities
requested to be included in the registration exceeds the number which can be
sold in the offering, the Company shall include in the registration as many
shares as practicable in the determination of the underwriter, and the number of
Registration Shares and other securities that may be included in such
registration and underwriting shall be allocated among all holders in proportion
as nearly as practicable to the respective amounts of securities such holders
are entitled to include in such registration pursuant to this Section 7 and to
similar registration rights in such registration held by all such holders at the
time of filing of such registration statement.
(iii) If a Piggyback Registration is an underwritten secondary
registration on behalf of holders of the Company's securities who have demand
registration rights and the managing underwriters thereof advise the Company in
writing that in their opinion the number of securities requested to be included
in the registration exceeds the number which can be sold in the offering, the
Company shall include in the registration:
(A) first, that portion of the Registration Shares that Seller
proposes to sell representing 25% of such offering;
(B) second, the securities of the holders of the Company's securities
who have exercised their demand registration rights; and
(C) third, the securities any other security holders of the Company
(including any additional Registration Shares Seller desires to sell) propose to
sell in proportion to the number of securities each proposes to sell.
In the event the Company subsequently desires to participate in such a
registration of securities, the Company shall include in the registration:
(D) first, that portion of the Registration Shares Sellers proposes to
sell representing 25% of such offering;
(E) second, the securities of the holders of the Company's securities
who have exercised their demand registration rights; and
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(F) third, the securities the Company and any other security holders
of the Company propose to sell (including any additional Registration Shares
Seller desires to sell) in proportion to the number of shares each proposes to
sell.
(c) INDEMNIFICATION BY THE COMPANY. In the event of any registration
of any Registration Shares under the Securities Act, the Company shall, and
hereby does, indemnify and hold harmless, in the case of any registration
statement filed pursuant to Section 7(a) or 7(b), Seller, its directors,
officers and employees, each other person who participates as an underwriter in
the offering or sale of Registration Shares and each other person, if any, who
controls Seller or any such underwriter within the meaning of Section 15 of the
Securities Act, against:
(i) any losses, claims, damages or liabilities, joint or several, to
which Seller or any such director, officer, employee or underwriter or
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which the
Registration Shares were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein in light of the circumstances in which they were made not
misleading;
(ii) any violation by the Company of the Securities Act or any rule or
regulation promulgated under the Securities Act applicable to the Company in
connection with any such registration; and
(iii) any legal or any other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability, action or proceeding; provided that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense:
(A) arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in such registration
statement, any such preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement in reliance upon and in conformity with
written information furnished to the Company through an instrument duly executed
by or on behalf of Seller or such underwriter, as the case may be, specifically
stating that it is for use in the preparation thereof; and
(B) with respect to any person who participates as an underwriter in
the offering or sale of Registration Shares or any other person, if any, who
controls such underwriter within the meaning of the Securities Act, arises out
of such person's failure
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to send or give a copy of the final prospectus, as the same may be then
supplemented or amended, to the person asserting an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registration Shares to such person if such statement
or omission was corrected in such final prospectus. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf of
Seller, or any such director, officer or controlling person and shall survive
the transfer of the Registration Shares by Seller.
(d) INDEMNIFICATION BY SELLER. The Company may require, as a condition
to including any Registration Shares in any registration statement filed
pursuant to Section 7(a) or 7(b), that the Company shall have received an
undertaking reasonably satisfactory to it from Seller (or the holder of the
Registration Shares), to indemnify and hold harmless (in the same manner and to
the same extent as set forth in Section 7(c)) the Company, each person who
participates as an underwriter in the offering or sale of Registration Shares,
each director of the Company, each officer of the Company who signs such
registration statement and each other person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act with respect to any
statement or alleged statement in or omission or alleged omission from such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, if such
statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information about Seller (or the
holder of the Registration Shares) as a stockholder of the Company furnished to
the Company through an instrument duly executed by Seller specifically stating
that it is for use in the preparation of such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement. Such indemnity shall remain in full force and effect, regardless of
any investigation made by or on behalf of the Company or any such underwriter,
director, officer or controlling person and shall survive the transfer by Seller
of the securities of the Company being registered.
(e) NOTICES OF CLAIMS, ETC. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in Section 7(c) or 7(d), such indemnified party shall, if a
claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action; provided that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under Section 7(c) or 7(d),
except to the extent that the indemnifying party is actually prejudiced by such
failure to give notice. In case any such action is brought against an
indemnified party, unless in such indemnified party's reasonable judgment a
conflict of interest between such indemnified and indemnifying parties may exist
or the indemnified party may have defenses not available to the indemnifying
party in respect of such claim, the indemnifying party shall be entitled to
participate in and to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
for
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any legal or other expenses subsequently incurred by the latter in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall be liable for any settlement of any action or
proceeding effected without its written consent. No indemnifying party shall,
without the consent of the indemnified party, consent to entry of any judgment
or enter into any settlement without the prior written consent of the
indemnified party..
(f) OTHER INDEMNIFICATION. Indemnification similar to that specified
in this Section 7 (with appropriate modifications) shall be given by the Company
and Seller with respect to any required registration or other qualification of
Registration Shares under any Federal or state law or regulation of any
Governmental Authority other than the Securities Act.
(g) INDEMNIFICATION PAYMENTS. The indemnification required by this
Section 7 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.
(h) ADJUSTMENTS AFFECTING REGISTRATION SHARES. The Company shall not
effect or permit to occur any combination, subdivision or other recapitalization
of any of its securities:
(i) which would materially adversely affect the ability of Seller to
include its Registration Shares, in any registration of securities of the
Company contemplated by this Section 7 ; or
(ii) solely for the purpose of adversely affecting the marketability
of such Registration Shares under any such registration.
(i) REGISTRATION COVENANTS OF THE COMPANY. In the event that any
Registration Shares of Seller are to be registered pursuant to Section 7(a) or
7(b), the Company covenants and agrees that it shall use its best efforts to
effect the registration and cooperate in the sale of the Registration Shares to
be registered and shall as expeditiously as reasonably possible:
(i)(A) prepare and file with the SEC a registration statement with
respect to the Registration Shares (as well as any necessary amendments or
supplements thereto) (a "Registration Statement"); and
(B) use its best efforts to cause the Registration Statement to become
effective;
(ii) prior to the filing described above in Section 7(i)(i), furnish
to Seller a final draft or drafts of the Registration Statement and any
amendments or supplements thereto and any prospectus forming a part thereof,
which documents shall be subject to
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the review of counsel for Seller (but not approval of such counsel except with
respect to any statement in the Registration Statement which relates to Seller);
(iii) notify Seller, promptly after the Company shall receive notice
thereof, of the time when the Registration Statement becomes effective or when
any amendment or supplement or any prospectus forming a part of the Registration
Statement has been filed;
(iv) notify Seller promptly of any request by the SEC for the amending
or supplementing of the Registration Statement or prospectus or for additional
information;
(v)(A) advise Seller after the Company shall receive notice or
otherwise obtain knowledge of the issuance of any order by the SEC suspending
the effectiveness of the Registration Statement or any amendment thereto or of
the initiation or threatening of any proceeding for that purpose; and
(B) promptly use its best efforts to prevent the issuance of any stop
order or to obtain its withdrawal promptly if a stop order should be issued;
(vi)(A) prepare and file with the SEC such post-effective amendments
and supplements to the Registration Statement and the prospectus forming a part
thereof as may be necessary to keep the Registration Statement effective for the
lesser of (I) a period of at least ninety (90) days from the effective date of
such registration statement; or (II) the period of time necessary to permit
Seller to dispose of all its Registration Shares registered under the
Registration Statement; and
(B) comply with the provision of the Securities Act with respect to
the disposition of all Registration Shares covered by the Registration Statement
during such period in accordance with the intended methods of disposition by
Seller set forth in the Registration Statement;
(vii) furnish to Seller such number of copies of the Registration
Statement, each amendment and supplement thereto, the prospectus included in the
Registration Statement (including each preliminary prospectus) and such other
documents as Seller may reasonably request in order to facilitate the
disposition of the Registration Shares owned by Seller;
(viii) use its best efforts to register or qualify such Registration
Shares under such other securities or blue sky laws of such jurisdictions as
determined by the underwriters after consultation with the Company and Seller
and do any and all other acts and things which may be reasonably necessary or
advisable to enable Seller to consummate the disposition in such jurisdictions
of the Registration Shares;
(ix) notify Seller, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any event
as a
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result of which the Registration Statement would contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and, at the request
of Seller, prepare a supplement or amendment to the Registration Statement so
that the Registration Statement shall not, to the Company's knowledge, contain
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading;
(x) if the common stock of the Company comprising the Purchase
Consideration is not then listed on a securities exchange, use its best efforts
to facilitate the reporting of the Common Stock on NASDAQ or another nationally
recognized securities exchange;
(xi) provide a transfer agent and registrar, which may be a single
entity, for all the Registration Shares not later than the effective date of the
Registration Statement;
(xii) enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other action, if any, as Seller
or the underwriters shall reasonably request in order to expedite or facilitate
the disposition of the Registration Shares;
(xiii)(A) make available for inspection by Seller, any underwriter
participating in any disposition pursuant to the Registration Statement and any
attorney, accountant or other agent retained by Seller or such underwriter all
financial and other records, pertinent corporate documents and properties of the
Company and
(B) cause the Company's officers, directors and employees to supply
all information reasonably requested by Seller, such underwriter, attorney,
accountant or agent in connection with the Registration Statement;
(xiv) use its best efforts to cause the Registration Shares covered by
the Registration Statement to be registered with or approved by such other
Governmental Authorities as may be necessary to enable Seller to consummate the
disposition of such Registration Shares; and
(j) EXPENSES. The Company shall pay (on behalf of Seller) all
expenses in connection with any Demand Registration and any Piggyback
Registration, including all registration, filing, listing and NASD fees, all
fees and expenses of complying with securities or blue sky laws, all word
processing, duplicating and printing expenses, all messenger and delivery
expenses, the fees and disbursements of counsel for the Company and of its
independent public accountants (including the expenses of comfort letters
required by or incident to such performance and compliance), the reasonable fees
and disbursements of not more than one counsel and accountants retained by
Seller and disbursements of underwriters customarily paid by issuers or
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sellers of securities, but excluding any underwriting discounts and commissions
and transfer taxes, if any. In any underwriting, Seller (or the holder of the
Registration Shares) shall pay its own underwriting discounts and commissions
and transfer taxes.
(k) ASSIGNMENT OF REGISTRATION RIGHTS. Seller may assign its rights
under this Section 7 to one person to whom Seller sells, transfers or assigns
over 50% of the Registration Shares it acquired pursuant to this Agreement;
provided that no assignment shall increase the Company's obligations to effect a
maximum of two Demand Registrations or to pay the expenses thereof.
.
(m) RULE 144. The Company shall take all actions reasonably necessary
to enable Seller to sell the Registration Shares without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
under the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the SEC, including filing on a
timely basis all reports required to be filed by the Exchange Act. Upon the
request of Seller, the Company shall deliver to Seller a written statement as to
whether it has complied with such requirements.
(n) REGISTRATION ON FORM S-3.
(i) The Company will use its best efforts to qualify for the
registration of its securities on Form S-3 (or successor form). If the Company
is a registrant eligible to use Form S-3 to register the Registration Shares,
all demand registrations effected pursuant to Section 7(a), above, shall be
registered on Form S-3. If Seller requests that the Company file a Registration
Statement on Form S-3 (or any successor form to Form S-3) for a public offering
of shares of Registration Shares the reasonably anticipated aggregate price to
the public of which, net of underwriting discounts and commissions, would exceed
$500,000 and the Company is a registrant entitled to use Form S-3 to register
the Registration Shares for such an offering, the Company shall use its best
efforts to cause such Registration Shares to be registered for the offering on
such form and to cause such Registration Shares to be qualified in such
jurisdictions as Seller may reasonably request; provided, however, that the
Company shall not be required to effect more than five registrations at Seller's
request pursuant to this Section 7(o)(i) or more than an aggregate of five total
registrations at Seller's request pursuant to this Section 7(o)(i) and 7(a),
above.
(ii) Notwithstanding the foregoing, the Company shall not be obligated
to take any action pursuant to this Section 7(o)(i):
(A) if the Company, within ten days of the receipt of the request of
Seller pursuant to Section 7(o)(i), gives notice of its bona fide intention to
effect the filing of a Registration Statement with the Commission within ninety
days of receipt of such request (other than with respect to a registration
statement relating to a Rule 145 transaction, an
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offering solely to employees or any other registration which is not appropriate
for the registration of Registration Shares); or
(B) during the period starting with the date sixty days prior to the
Company's estimated date of filing of, and effective date of any Registration
Statement pertaining to securities of the Company (other than a registration of
securities in a Rule 145 transaction or with respect to an employee benefit
plan), provided that the Company is actively employing in good faith all
reasonable efforts to cause such Registration Statement to become effective.
(iii) Seller agrees in connection with any registration of the
Company's securities pursuant to which Seller is permitted to sell the number of
Registration Shares that Seller desires to sell (other than a registration of
securities in a Rule 145 transaction or with respect to an employee benefit
plan), upon the request of the Company or the underwriters managing any
underwritten offering of the Company's securities, not to sell, make any short
sale of, loan, grant any option for the purchase of or otherwise dispose of any
Registrable Shares (other than those included in such registration and other
than in a private sale of Registration Shares by Seller) without the prior
written consent of the Company or such underwriters, as the case may be, for
such period of time (not to exceed one hundred thirty five (135) days) from the
effective date of such registration statement as may be requested by the Company
or such managing underwriters, provide that each of the Company's officers,
directors, five percent (5%) stockholders and other stockholders selling shares
of the Company pursuant to any such registration statement, shall have agreed to
be bound by the same restrictions in connection with such offering.
8. MISCELLANEOUS.
(a) EXPENSES. Each party shall be liable for its own expenses in
connection with the transactions contemplated by this Agreement.
(b) TAXES. The Company shall be responsible for all stock transfer and
documentary taxes, if any, arising out of the transactions contemplated by this
Agreement.
(c) AMENDMENTS. All amendments or waivers of any provisions of this
Agreement may only be made pursuant to a written instrument executed by the
parties hereto or their successors and assigns.
(d) RULE 144(K). The Company shall not be obligated to undertake a
registration of the Seller's Registration Shares pursuant to Section 7 hereof at
any time that Seller's counsel agrees that Seller may sell its Registration
Shares pursuant to Rule 144(k) under the Securities Act.
(e) SUCCESSORS AND ASSIGNS. All covenants and agreements in this
Agreement contained by or on behalf of either of the parties hereto shall bind
and inure to
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the benefit of the respective successors and assigns of Seller and the Company,
whether so expressed or not.
(f) NOTICES. All notices, requests and other communications provided
for hereunder shall be effective upon receipt, shall be in writing and shall be
deemed to have been duly given if delivered in person or by courier, telegraph,
telex or by facsimile transmission with electromechanical report of delivery:
If to the Company:
Silicon Valley Group, Inc.
000 Xxxxx Xxxxx, Xxxxx #000
Xxx Xxxx, XX 00000
Attention:
Xx. Xxxxxxx X. Xxxxxxxxx
With a copy to:
Wilson, Sonsini, Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxx X. Xxxxxxx
If to Seller:
International Business Machines Corporation
Xxx Xxxxxxx Xxxx
Xxxxxx, Xxx Xxxx, 00000
Attention:
Xx. Xxx X. Xxxxxx
Vice President,
Corporate Development and Real Estate
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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With a copy to:
Xxxxxx X. Xxxxxxxx, Esq.,
Room 1C-63
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
or to such other address with respect to either party as such party shall notify
the other in writing.
(g) GOVERNING LAW AND JURISDICTION. This Agreement shall be construed
and enforced in accordance with, and the rights of the parties shall be governed
by, the laws of the State of New York (without regard to the choice of law
provisions thereof).
(h) HEADINGS. The descriptive headings of the several paragraphs of
this Agreement are inserted for convenience only and do not constitute a part of
this Agreement.
(i) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Agreement to produce or account for more than
one such counterpart.
(j) PUBLIC ANNOUNCEMENTS. Neither Seller nor the Company will issue
any press release or public announcement of the transactions contemplated hereby
except:
(i) as they may mutually agree in writing; or
(ii) as may be required in the opinion of counsel under applicable law
in which case the party so required to make such an announcement shall provide a
draft of the proposed announcement and a copy of such opinion to the other party
no less than two (2) business days prior to the date of the proposed
announcement (unless it is unlawful or impracticable to do so).
(k) COMPLETE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and, except as
provided herein, supersedes all previous negotiations, commitments and writings.
This Agreement is not intended to confer any benefit upon any person other than
the parties hereto.
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IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement as of the date first above written.
INTERNATIONAL BUSINESS MACHINES CORPORATION
By: /s/ Xxx X. Xxxxxx
--------------------------
Name: Xxx X. Xxxxxx
Title: IBM Vice President, Corporate Development and Real Estate
SILICON VALLEY GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President and Chief Financial Officer
