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Exhibit 10.30
HOUSTON STREET EXCHANGE, INC.
AMENDMENT NO. 1
TO
SERIES A CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
This Amendment No. 1 (this "Amendment") to that certain Series A
Convertible Preferred Stock Purchase Agreement (the "Agreement") dated as of
February 2, 2000 by and among Houston Street Exchange, Inc., a Delaware
corporation ("Houston Street"), and the Purchasers (as defined therein) is
entered into as of March 6, 2000, among Houston Street and those Purchasers
party hereto (the "Amending Purchasers"). Capitalized terms used and not
otherwise defined herein shall have the respective meanings ascribed to them in
the Agreement.
PRELIMINARY STATEMENT
A. Houston Street and the Purchasers entered into the Agreement as of
February 2, 2000.
X. Xxxxxxx Street and the Amending Purchasers desire to amend the
Agreement to provide for the sale by Houston Street of additional shares of
Series A Preferred.
C. Section 9.10 of the Agreement provides that the Agreement may be
amended with the written consent of Houston Street and by the holders of 75% of
the shares of Common Stock issued or issuable upon conversion of the Shares.
D. The Amending Purchasers are the holders of at a least 75% of the
shares of Common Stock issued or issuable upon conversion of the Shares.
NOW THEREFORE, Houston Street and the Amending Purchasers hereby agree and
consent as follows:
1. The text appearing in Section 2(b) of the Agreement is hereby (i)
deleted in its entirety, and as of the effective date hereof, shall be of no
effect, retrospectively or prospectively, and (ii) replaced by the text set
forth below:
(b) The Company may sell, at any time prior to 90 days after the
Closing, in one or more closings (each, a "Subsequent Closing"), up to 2,080,002
additional Shares at the Purchase Price, to such purchasers (each, an
"Additional Purchaser") as may be approved by the Board of Directors of the
Company. At each Subsequent Closing, (i) the Company and each Additional
Purchaser shall execute and deliver a counterpart signature page to this
Agreement and each of the other agreements required to be executed by the
Company at or prior to the Closing pursuant to Section 5.4 (the "Ancillary
Agreements"), in each case without material modification, whereupon such
Additional Purchaser shall become a "Purchaser" hereunder
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and the Shares purchased by such Additional Purchaser shall be deemed to be
"Shares" for purposes of this Agreement and (ii) the Company shall cause EXHIBIT
A to this Agreement to be amended to reflect the purchases made by the
Additional Purchasers at each Subsequent Closing. At each Subsequent Closing,
the Company shall deliver to each Additional Purchaser a certificate for the
number of Shares being purchased at the Subsequent Closing by such Additional
Purchaser, registered in the name of such Additional Purchaser, against payment
to the Company of the Purchase Price in the manner specified above. The Company
shall deliver to each Purchaser, within three business days after any Subsequent
Closing, written notice of such Subsequent Closing (which notice shall specify
the names of each Additional Purchaser and the number of shares of Series A
Preferred issued to each).
2. A new second sentence is hereby added to the text appearing in Section
3.2 of the Agreement consisting of the text set forth below:
The authorized capital stock of the Company (immediately prior to the
first Subsequent Closing) consists of (i) 20,761,669 shares of Common Stock, of
which (A) 14,814,815 were issued and outstanding immediately before the first
Subsequent Closing and (B) 2,000,000 shares have been reserved for issuance
pursuant to the 1999 Stock Incentive Plan of the Company (of which the Company
has granted options to purchase an aggregate of 1,321,800 shares of Common
Stock) and (ii) 3,680,003 shares of Preferred Stock, $0.01 par value per share,
all of which have been designated as Series A Preferred, of which 1,600,001 were
issued and outstanding immediately before the first Subsequent Closing.
3. Except to the extent amended by this Amendment, the Agreement is, in
all respects, hereby ratified and confirmed and shall continue in full force and
effect.
4. This Amendment shall be governed by and construed in accordance with
the internal laws of the State of Delaware (without reference to the conflicts
of law provisions thereof).
5. This Amendment may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument.
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EXECUTED as of the date first written above.
HOUSTON STREET EXCHANGE, INC.
By: /s/ Xxxxx X. Xxxxxx Xx.
-----------------------
Xxxxx X. Xxxxxx Xx.
President and Chief Executive
Officer
XXXXXXX ASSOCIATES, L.P.
By: /s/ Xxxx Xxxxxx
---------------
EQUIVA TRADING COMPANY
By: /s/ Xxxxxx Xxxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxxx
Title: President, Equiva
Trading Company
OMEGA ADVISORS, INC.
By: /s/ Xxxxxxxx Xxxxxxx
--------------------
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EXECUTION COPY
HOUSTON STREET EXCHANGE, INC.
SERIES A CONVERTIBLE PREFERRED STOCK
PURCHASE AGREEMENT
Dated as of February 2, 2000
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TABLE OF CONTENTS
PAGE NO.
1. Authorization and Sale of Shares..........................................................................1
1.1. Authorization.......................................................................................1
1.2. Sale of Shares......................................................................................1
1.3. Use of Proceeds.....................................................................................1
2. The Closing...............................................................................................2
3. Representations of the Company............................................................................2
3.1. Organization and Standing...........................................................................3
3.2. Capitalization......................................................................................3
3.3. Subsidiaries, Etc...................................................................................3
3.4. Issuance of Shares..................................................................................3
3.5. Authority...........................................................................................4
3.6. Noncontravention....................................................................................4
3.7. Governmental Consents...............................................................................4
3.8. Litigation..........................................................................................5
3.9. Financial Statements................................................................................5
3.10. Absence of Undisclosed Liabilities; No Default......................................................5
3.11. Property and Assets.................................................................................5
3.12. Taxes...............................................................................................5
3.13. Intellectual Property...............................................................................6
3.14. Insurance...........................................................................................6
3.15. Material Contracts and Obligations..................................................................7
3.16. Compliance..........................................................................................7
3.17. Absence of Changes..................................................................................7
3.18. Employees...........................................................................................7
3.19. Books and Records...................................................................................8
3.20. U.S. Real Property Holding Corporation..............................................................8
3.21. Registration Rights.................................................................................8
3.22. Investment Company Act..............................................................................8
4. Representations of the Purchasers.........................................................................8
4.1. Investment..........................................................................................8
4.2. Authority...........................................................................................8
4.3. Experience..........................................................................................8
5. Conditions to the Obligations of the Purchasers...........................................................9
5.1. Accuracy of Representations and Warranties..........................................................9
5.2. Performance.........................................................................................9
5.3. Opinion of Counsel..................................................................................9
5.4. Ancillary Agreements................................................................................9
5.5. Certificates and Documents..........................................................................9
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5.6. Compliance Certificates............................................................................10
5.7. Other Matters......................................................................................10
6. Conditions to the Obligations of the Company.............................................................10
6.1. Accuracy of Representations and Warranties.........................................................10
6.2. Ancillary Agreements...............................................................................10
6.3. Other Matters......................................................................................10
7. Affirmative Covenants of the Company.....................................................................11
7.1. Books and Records; Inspection......................................................................11
7.2. Financial Statements and Other Information.........................................................11
7.3. Material Changes and Litigation....................................................................12
7.4. Key Man Insurance..................................................................................12
7.5. Directors..........................................................................................12
7.6. Reservation of Common Stock; No Integration........................................................12
7.7. Corporate Existence; Code of Conduct...............................................................12
7.8. Taxes..............................................................................................12
7.9. Compliance with Law................................................................................13
7.10. Termination of Covenants...........................................................................13
8. Transfer of Shares.......................................................................................13
8.1. Restricted Shares..................................................................................13
8.2. Requirements for Transfer..........................................................................13
8.3. Legend.............................................................................................13
8.4. Rule 144A Information..............................................................................14
9. Miscellaneous............................................................................................14
9.1. Successors and Assigns.............................................................................14
9.2. Confidentiality....................................................................................14
9.3. Survival of Representations and Warranties.........................................................15
9.4. Brokers............................................................................................15
9.5. Severability.......................................................................................15
9.6. Specific Performance...............................................................................15
9.7. Governing Law......................................................................................15
9.8. Notices............................................................................................16
9.9. Complete Agreement.................................................................................16
9.10. Amendments and Waivers.............................................................................16
9.11. Pronouns...........................................................................................16
9.12. Counterparts; Facsimile Signatures.................................................................16
9.13. Section Headings...................................................................................17
10. Definitions..............................................................................................17
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EXHIBITS
Exhibit A - List of Purchasers
Exhibit B - Amended and Restated Certificate of Incorporation
Exhibit C - Exceptions to Representations
Exhibit D - Employee Invention and Non-Disclosure Agreement
Exhibit E - Opinion of Xxxx and Xxxx LLP, Counsel to the Company
Exhibit F - Stockholders' Voting Agreement
Exhibit G - Investor Rights Agreement
Exhibit H - Right of First Refusal and Co-Sale Agreement
Exhibit I - Code of Conduct
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XXXXXXX XXXXXX EXCHANGE, INC.
SERIES A CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT
This Agreement dated as of February 2, 2000 is entered into by and among
Houston Street Exchange, Inc., a Delaware corporation (the "Company") and the
individuals and entities listed on EXHIBIT A hereto (each a "Purchaser" and
collectively the "Purchasers").
RECITALS
1. BayCorp Holdings, Ltd., a Delaware corporation ("BayCorp"), owns
10,000,000 shares of the common stock, par value $.01 per share (the "Common
Stock"), of the Company;
2. Immediately before the Closing (as defined in Section 2 below), Equiva
Trading Company, a Delaware general partnership ("Equiva"), purchased 4,814,815
shares of Common Stock (the "Equiva Common Stock Purchase") pursuant to a Common
Stock Purchase Agreement of even date herewith. Equiva is also a Purchaser under
this Agreement.
In consideration of the mutual promises and covenants contained in this
Agreement, the parties hereto agree as follows:
1. AUTHORIZATION AND SALE OF SHARES.
1.1. AUTHORIZATION. The Company has, or before the Closing will have,
duly authorized the sale and issuance, pursuant to the terms of this Agreement,
of 3,200,001 shares of its Series A Convertible Preferred Stock, $.01 par value
per share (the "Series A Preferred"), having the rights, restrictions,
privileges and preferences set forth in the Amended and Restated Certificate of
Incorporation attached hereto as EXHIBIT B (the "Certificate of Incorporation").
The Company has, or before the Closing will have, adopted and filed the
Certificate of Incorporation with the Secretary of State of the State of
Delaware.
1.2. SALE OF SHARES. Subject to the terms and conditions of this
Agreement, at the Closing the Company will sell and issue to each of the
Purchasers, and each of the Purchasers will purchase, the number of shares of
Series A Preferred set forth opposite such Purchaser's name on EXHIBIT A for the
purchase price of $3.75 per share (the "Purchase Price"). The shares of Series A
Preferred sold under this Agreement are referred to as the "Shares." The
Company's agreement with each of the Purchasers is a separate agreement, and the
sale of Shares to each of the Purchasers is a separate sale.
1.3. USE OF PROCEEDS. The Company will use $4,393,794 of the proceeds
from the sale of the Shares to repay to BayCorp all outstanding indebtedness for
borrowed money owed to BayCorp existing as of the Closing Date (as defined in
Section 2 below). The Company will use the balance of the net proceeds from the
sale of the Shares exceeding the amount repaid to BayCorp for (i) developing and
launching an Internet-based crude oil and refined products
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trading platform, a natural gas trading platform and the Company's SpeedWay
platform and (ii) general corporate purposes.
2. THE CLOSINGS.
(a) The closing (the "Closing") of the sale and purchase of the
Shares under this Agreement shall take place at the offices of the Company at
0000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxx 00000 at 9 a.m. Central Time on February
2, 2000, or at such other time, date and place as are mutually agreeable to the
Company and the Purchasers. At the Closing, the Company shall deliver to each of
the Purchasers a certificate for the number of Shares being purchased at the
Closing by such Purchaser, registered in the name of such Purchaser, against
payment to the Company of the Purchase Price, by wire transfer, check or other
method of delivering immediately available funds that is acceptable to the
Company. The date of the Closing is hereinafter referred to as the "Closing
Date." If at the Closing any of the conditions specified in Section 5 shall not
have been fulfilled, each of the Purchasers shall, at his, her or its election,
be relieved of all of his, her or its obligations under this Agreement and will
thereby waive all other rights he, she or it may have by reason of such failure
or such non-fulfillment.
(b) The Company may sell, at any time prior to 90 days after the
Closing, in one or more closings (each, a "Subsequent Closing"), up to 1,600,000
additional Shares at the Purchase Price, to such purchasers (each, an
"Additional Purchaser") as may be approved by the Board of Directors of the
Company. At each Subsequent Closing, (i) the Company and each Additional
Purchaser shall execute and deliver a counterpart signature page to this
Agreement and each of the other agreements required to be executed by the
Company at or prior to the Closing pursuant to Section 5.4 (the "Ancillary
Agreements"), in each case without material modification, whereupon such
Additional Purchaser shall become a "Purchaser" hereunder and the Shares
purchased by such Additional Purchaser shall be deemed to be "Shares" for
purposes of this Agreement and (ii) the Company shall cause EXHIBIT A to this
Agreement to be amended to reflect the purchases made by the Additional
Purchasers at each Subsequent Closing. At each Subsequent Closing, the Company
shall deliver to each Additional Purchaser a certificate for the number of
Shares being purchased at the Subsequent Closing by such Additional Purchaser,
registered in the name of such Additional Purchaser, against payment to the
Company of the Purchase Price in the manner specified above. The Company shall
deliver to each Purchaser, within three business days after any Subsequent
Closing, written notice of such Subsequent Closing (which notice shall specify
the names of each Additional Purchaser and the number of shares of Series A
Preferred issued to each).
3. REPRESENTATIONS OF THE COMPANY. Except as disclosed by the Company in
EXHIBIT C hereto, the Company hereby represents and warrants to each of the
Purchasers that the statements contained in this Section 3 are true, complete
and correct. EXHIBIT C shall be arranged in paragraphs corresponding to the
numbered and lettered paragraphs contained in this Section 3, and the
disclosures in any paragraph of EXHIBIT C shall qualify (1) the corresponding
paragraph of this Section 3 and (2) other paragraphs of this Section 3 to the
extent it is clear (notwithstanding the absence of a specific cross reference)
from a reading of the disclosure that such disclosure is applicable to such
other paragraphs. The inclusion of any information in
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EXHIBIT C shall not be deemed to be an admission or acknowledgment, in and of
itself, that such information is required by the terms of this Agreement to be
disclosed, is material to the Company, has or would have a material adverse
effect on the business, prospects, assets or condition (financial or otherwise)
of the Company (a "Company Material Adverse Effect") or is outside the ordinary
course of business.
3.1. ORGANIZATION AND STANDING. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware. The Company has full corporate power and authority to own its
properties and conduct its business as presently conducted and as currently
contemplated to be conducted in the United States and to enter into and perform
this Agreement and each of the Ancillary Agreements and to carry out the
transactions contemplated by this Agreement and the Ancillary Agreements. The
Company is duly qualified to do business as a foreign corporation and is in good
standing in the State of New Hampshire, the State of Texas and in every other
jurisdiction in which the failure so to qualify would have a Company Material
Adverse Effect. The Company has made available to the Purchasers true and
complete copies of its Certificate of Incorporation and By-Laws, each as amended
to date and currently in effect.
3.2. CAPITALIZATION. The authorized capital stock of the Company
(immediately prior to the Closing) consists of (i) 20,015,000 shares of Common
Stock, of which (A) 10,000,000 shares were issued and outstanding immediately
before the Equiva Common Stock Purchase; (B) 14,814,815 shares were issued and
outstanding immediately before the Closing and (C) 2,000,000 shares have been
reserved for issuance pursuant to the 1999 Stock Incentive Plan of the Company
(of which the Company has granted options to purchase an aggregate of 1,321,800
shares of Common Stock) and (ii) 3,200,001 shares of Preferred Stock, $.01 par
value per share, all of which have been designated as Series A Preferred and
none of which shares are issued or outstanding. All of the issued and
outstanding shares of Common Stock (i) have been duly authorized and validly
issued and are fully paid and nonassessable and (ii) were issued in compliance
with all applicable federal and state securities laws. Immediately prior to the
Closing, BayCorp owned of record 10,000,000 shares of Common Stock and Equiva
owned of record 4,814,815 shares of Common Stock. Except as provided in this
Agreement, the Ancillary Agreements or as authorized or outstanding pursuant to
the Company's 1999 Stock Incentive Plan, (i) no subscription, warrant, option,
convertible security or other right to purchase or acquire any shares of capital
stock of the Company is authorized or outstanding and no party has any
preemptive rights, rights of first refusal or similar rights to acquire any such
shares, (ii) the Company has no obligation to issue any subscription, warrant,
option, convertible security or other such right or to issue or distribute to
holders of any shares of its capital stock any evidences of indebtedness or
assets of the Company, (iii) the Company has no obligation to purchase, redeem
or otherwise acquire any shares of its capital stock or any interest therein or
to pay any dividend or make any other distribution in respect thereof, (iv)
there are no outstanding or authorized stock appreciation, phantom stock or
similar rights with respect to the Company and (v) the Company has no obligation
or commitment to do any of the foregoing. The shares of Series A Preferred have
the rights, preferences and privileges set forth in the Certificate of
Incorporation, except as such rights, preferences and privileges may be limited
by law.
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3.3. SUBSIDIARIES, ETC. The Company has no subsidiaries and does not
own or control, directly or indirectly, any shares of capital stock of any other
corporation or any interest in any partnership, joint venture or other
non-corporate business enterprise. Except for the Ancillary Agreements or as set
forth in Section 3.3 of EXHIBIT C, there are no material written or oral
agreements between the Company, on the one hand, and BayCorp or its affiliates,
on the other hand.
3.4. ISSUANCE OF SHARES. The issuance, sale and delivery of the Shares
in accordance with this Agreement, and the issuance and delivery of the shares
of Common Stock issuable upon conversion of the Shares, have been, or will be on
or prior to the Closing, duly authorized by all necessary corporate action on
the part of the Company, and all such shares have been duly reserved for
issuance. The Shares when so issued, sold and delivered against payment therefor
in accordance with the provisions of this Agreement, and the shares of Common
Stock issuable upon conversion of the Shares, when issued upon such conversion,
will be duly and validly issued, fully paid and nonassessable and free of
Security Interests, except pursuant to the Ancillary Agreements and applicable
securities laws and not issued in violation of preemptive or other similar
rights of any third party. For purposes of this Agreement, "Security Interest"
means any mortgage, pledge, security interest, encumbrance, charge or other lien
(whether arising by contract or by operation of law).
3.5. AUTHORITY. The execution, delivery and performance by the Company
of this Agreement and the Ancillary Agreements, and the consummation by the
Company of the transactions contemplated hereby and thereby, have been duly
authorized by all necessary corporate action by the Company, including necessary
stockholder action. This Agreement has been, and the Ancillary Agreements when
executed at the Closing will be, duly executed and delivered by the Company and
constitute valid and binding obligations of the Company enforceable in
accordance with their respective terms, subject as to enforcement of remedies to
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting generally the enforcement of creditors' rights and subject to a
court's discretionary authority with respect to the granting of a decree
ordering specific performance or other equitable remedies.
3.6. NONCONTRAVENTION. The execution of and performance of the
transactions contemplated by this Agreement (including, without limitation, the
issuance of Common Stock upon conversion of the Series A Preferred) and the
Ancillary Agreements and compliance with their respective provisions by the
Company will not (a) conflict with or violate any provision of the Certificate
of Incorporation or By-laws of the Company, (b) require on the part of the
Company any filing with, or any permit, authorization, consent or approval of,
any court, arbitrational tribunal, administrative agency or commission or other
governmental or regulatory authority or agency (each of the foregoing is
hereafter referred to as a "Governmental Entity") or other third party, except
for any filing, permit, authorization, consent or approval which if not obtained
or made would not reasonably be expected to have a Company Material Adverse
Effect, (c) conflict with, result in a breach of, constitute (with or without
due notice or lapse of time or both) a default under, result in the acceleration
of, create in any party the right to accelerate, terminate, modify or cancel, or
require any notice, consent or waiver under, any contract, lease,
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sublease, license, sublicense, franchise, permit, indenture, agreement or
mortgage for borrowed money, instrument of indebtedness, Security Interest or
other arrangement to which the Company is a party or by which the Company is
bound or to which its assets are subject, (d) result in the imposition of any
Security Interest upon any assets of the Company or (e) conflict with or violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
the Company or any of its properties or assets.
3.7. GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any Governmental Entity is required on the part of the Company in
connection with (i) the execution and delivery of this Agreement or the
Ancillary Agreements, (ii) the offer, issuance, sale and delivery of the Shares,
(iii) the issuance and delivery of the shares of Common Stock issuable upon
conversion of the Shares or (iv) the other transactions to be consummated at the
Closing, in each case as contemplated by this Agreement and the Ancillary
Agreements, except such filings as shall have been made prior to and shall be
effective on and as of the Closing and such filings required to be made after
the Closing under applicable federal and state securities laws, all of which
filings are specified in EXHIBIT C. Based in part on the representations made by
each of the Purchasers in Section 4 of this Agreement, no registration was
required under the Securities Act or under applicable state securities laws in
connection with the issuance and sale of (A) the outstanding shares of capital
stock of the Company and (B) the shares of Series A Preferred issued and sold
pursuant to this Agreement.
3.8. LITIGATION. There is no action, suit, proceeding, written claim
or written demand pending against the Company. There is no action, suit,
proceeding, governmental inquiry or investigation threatened against the
Company. In addition, to the Company's knowledge, there is no governmental
inquiry or investigation pending against the Company.
3.9. FINANCIAL STATEMENTS. EXHIBIT C hereto contains a complete and
correct copy of the unaudited balance sheet of the Company (the "Balance Sheet")
at November 30, 1999 (the "Balance Sheet Date") and the related statements of
operations and cash flows for the period that commenced on April 27, 1999
(formation) and ended on the Balance Sheet Date (collectively, the "Financial
Statements"). The Financial Statements are complete and correct, are in
accordance with the books and records of the Company and present fairly the
financial condition and results of operations of the Company, at the dates and
for the periods indicated, and have been prepared in accordance with generally
accepted accounting principles ("GAAP") consistently applied, except that the
Financial Statements do not include footnotes and are subject to normal year-end
audit adjustments.
3.10. ABSENCE OF UNDISCLOSED LIABILITIES; NO DEFAULT. The Company does
not have any liability (whether known or unknown and whether absolute or
contingent), except for (a) liabilities shown on the Balance Sheet, (b)
liabilities which have arisen since the Balance Sheet Date in the ordinary
course of business and are not, in the case of any individual liability or group
of related liabilities due to a particular person or entity, in excess of
$50,000 and (c) contractual and other liabilities incurred in the ordinary
course of business which are not required by GAAP to be reflected on a balance
sheet. The Company is not in material default under any
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contract, lease, sublease, license, sublicense, franchise, permit, indenture,
agreement or mortgage for borrowed money, instrument of indebtedness or Security
Interest.
3.11. PROPERTY AND ASSETS. The Company has good title to, or a valid
leasehold interest in, all of its material properties and assets, including all
properties and assets reflected in the Balance Sheet, except those disposed of
since the date thereof in the ordinary course of business, and none of such
properties or assets is subject to any Security Interest.
3.12. TAXES. For the tax year ended December 31, 1999, the Company's
federal corporate income tax obligations were consolidated with BayCorp. Since
April 27, 1999 (formation) to the Closing Date, the Company has timely paid and
discharged, or (with respect to taxes, assessments or other governmental
charges, any of which are not yet due and payable) reserved for, all taxes
(including all employment and payroll taxes) and all assessments or other
governmental charges due as a result of the Company's ownership of its property
or in respect of its franchises or income.
3.13. INTELLECTUAL PROPERTY.
(a) The Company owns, free and clear of all Security Interests,
or has the valid right to use all Intellectual Property (as defined below in
this Section 3.13) used by it in its business as currently conducted. Each
employee of the Company who created any of the Company's Intellectual Property
and each independent contractor engaged by the Company who created any of the
Company's Intellectual Property has assigned to the Company all of such
employee's or contractor's right, title and interest in such Intellectual
Property. No other person or entity (other than licensors of software that is
generally commercially available, licensors of Intellectual Property under the
agreements disclosed pursuant to paragraph (c) below and non-exclusive licensees
of the Company's Intellectual Property in the ordinary course of the Company's
business) has any rights to any of the Intellectual Property owned or used by
the Company, and, to the Company's knowledge, no other person or entity is
infringing, violating or misappropriating any of the Intellectual Property that
the Company owns. For purposes of this Agreement, "Intellectual Property" means
all (i) patents and patent applications, (ii) copyrights and registrations
thereof, (iii) mask works and registrations and applications for registration
thereof, (iv) computer software, data and documentation, (v) trade secrets and
confidential business information, whether patentable or unpatentable and
whether or not reduced to practice, know-how, manufacturing and production
processes and techniques, research and development information, copyrightable
works, financial, marketing and business data, pricing and cost information,
business and marketing plans and customer and supplier lists and information,
(vi) trademarks, service marks, trade names, domain names and applications and
registrations therefor and (vii) other proprietary rights relating to any of the
foregoing.
(b) None of the activities or business conducted by the Company
and none of the Intellectual Property owned or used by the Company (other than
"off-the-shelf" generally commercially available software) infringes, violates
or constitutes a misappropriation of (or in the past infringed, violated or
constituted a misappropriation of) any Intellectual
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Property of any other person or entity. The Company has not received any written
complaint, claim or notice alleging any such infringement, violation or
misappropriation.
(c) Section 3.13 of EXHIBIT C hereto identifies each agreement
with a third party pursuant to which the Company obtains rights to Intellectual
Property material to the business of the Company (other than software that is
generally commercially available) that is owned by a party other than the
Company. Other than license fees for software that is generally commercially
available, the Company is not obligated to pay any royalties or other
compensation to any third party in respect of its ownership, use or license of
any of its Intellectual Property.
(d) The Company has taken reasonable precautions (i) to protect
its rights in its Intellectual Property and (ii) to maintain the confidentiality
of its trade secrets, know-how and other confidential Intellectual Property, and
to the Company's knowledge, there have been no acts or omissions by the
officers, directors, shareholders, employees and agents of the Company the
result of which would be to materially compromise the rights of the Company to
apply for or enforce appropriate legal protection of the Company's Intellectual
Property.
3.14. INSURANCE. The Company maintains valid policies of workers'
compensation insurance and of insurance with respect to its properties and
business of the kinds and in the amounts not less than is customarily obtained
by corporations of established reputation engaged in the same or similar
business and similarly situated, including, without limitation, insurance
against loss, damage, fire, theft, public liability and other risks, all of
which policies are in full force and effect.
3.15. MATERIAL CONTRACTS AND OBLIGATIONS. EXHIBIT C sets forth a true
and complete list of the following agreements, commitments and understandings,
whether written or oral, to which the Company is a party or by which it is
bound: (a) those which require future expenditures by the Company in excess of
$100,000 or which might result in payments to the Company in excess of $100,000,
(b) employment and consulting agreements, any "employee benefit plan" (as that
term is defined in the Employee Retirement Income Security Act of 1974, as
amended), bonus, pension, profit-sharing, stock option, stock purchase and
similar plans and arrangements, (c) those with any current or former
stockholder, officer or director of the Company, or any "affiliate" or
"associate" of such persons (as such terms are defined in the rules and
regulations promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), including without limitation any agreement or other
arrangement providing for the furnishing of services by, rental of real or
personal property from, or otherwise requiring payments to, any such person or
entity, (d) those under which the Company is restricted from carrying on any
business or that otherwise materially restrict the Company in the operation of
its business anywhere in the world, (e) those relating to indebtedness for
borrowed money in excess of $100,000, (f) those for the disposition of a
material portion of the Company's assets (other than for the sale of inventory
in the ordinary course of business), (g) those for the acquisition of the
business or shares of another party and (h) those which are otherwise material
to the Company or its business. All such agreements, commitments and
understandings are in full force and effect. Neither the Company, nor, to the
Company's knowledge, any other party thereto, is in default of any of its
obligations under any such agreement, commitment or understanding.
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3.16. COMPLIANCE. The Company has, in all material respects, complied,
and is currently in compliance in all material respects, with all laws,
regulations, ordinances and orders applicable to its present and proposed
business and has all material permits, licenses and authorizations required
thereby. There is no term or provision of any mortgage, indenture, contract,
agreement or instrument to which the Company is a party or by which it is bound,
or, to the best of the Company's knowledge, of any provision of any state or
federal judgment, decree, order, statute, rule or regulation applicable to or
binding upon the Company, which is reasonably likely to have a Company Material
Adverse Effect. To the Company's knowledge, no employee of the Company is in
material violation of any term of any contract or covenant (either with the
Company or with another entity) relating to employment, patents, assignment of
inventions, proprietary information disclosure, non-competition or
non-solicitation.
3.17. ABSENCE OF CHANGES. Since the Balance Sheet Date, there has been
no material adverse change in the business, prospects, financial condition or
results of operations of the Company; provided, however, that the Company has
continued to incur losses since the Balance Sheet Date as described in Section
3.17 of EXHIBIT C.
3.18. EMPLOYEES. All employees of the Company who have or may
reasonably be expected in the future to have access to confidential or
proprietary information of the Company have executed and delivered or will have
executed and delivered employee invention and nondisclosure agreements in the
form of EXHIBIT D, and all of such agreements are in full force and effect. The
Company has complied in all material respects with all applicable laws relating
to wages, hours, equal opportunity, collective bargaining, workers' compensation
insurance and the payment of social security and other taxes. None of the
employees of the Company is represented by any labor union, and there is no
labor strike or other labor trouble pending with respect to the Company
(including, without limitation, any organizational drive) or, to the best of the
Company's knowledge, threatened.
3.19. BOOKS AND RECORDS. The minute books of the Company contain
complete and accurate records of all meetings and other corporate actions of its
stockholders and its Board of Directors and committees thereof. The stock ledger
of the Company is complete and reflects all issuances, transfers, repurchases
and cancellations of shares of capital stock of the Company.
3.20. U.S. REAL PROPERTY HOLDING CORPORATION. The Company is not now
and has never been a "United States Real Property Holding Corporation" as
defined in Section 897(c)(2) of the Internal Revenue Code and Section 1.897-2(b)
of the IRS Regulations.
3.21. REGISTRATION RIGHTS. Except as set forth in the Investor Rights
Agreement (as defined in Section 5.4(b) below), the Company is not under any
contractual obligation to register with the Commission any of its currently
outstanding securities or any of its securities that may hereafter be issued.
3.22. INVESTMENT COMPANY ACT. The Company is not, and after giving
effect to the offering and sale of the shares of Series A Preferred pursuant to
this Agreement will not be, an "investment company" or entity controlled by an
"investment company," as such terms are defined in the Investment Company Act of
1940, as amended.
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4. REPRESENTATIONS OF THE PURCHASERS. Each of the Purchasers severally
represents and warrants to the Company as follows:
4.1. INVESTMENT. Such Purchaser is acquiring the Shares, and the
shares of Common Stock into which the Shares may be converted, for his, her or
its own account for investment and not with a view to, or for sale in connection
with, any distribution thereof, nor with any present intention of distributing
or selling the same; and, except as contemplated by this Agreement and the
Exhibits hereto, such Purchaser has no agreement, undertaking, arrangement,
obligation, indebtedness or commitment providing for the disposition thereof.
Such Purchaser is an "accredited investor" as defined in Rule 501(a) under the
Securities Act.
4.2. AUTHORITY. Such Purchaser has full power and authority to enter
into and to perform this Agreement in accordance with its terms. Any Purchaser
which is a corporation, partnership or trust represents that it has not been
organized, reorganized or recapitalized specifically for the purpose of
investing in the Company.
4.3. EXPERIENCE. Such Purchaser has carefully reviewed the
representations made by the Company in this Agreement and has carefully reviewed
the Confidential Private Placement Memorandum of the Company dated January 11,
2000; the officers of the Company have made available to such Purchaser any and
all written information which he, she or it has requested and have answered to
such Purchaser's satisfaction all inquiries made by such Purchaser; and such
Purchaser has sufficient knowledge and experience in finance and business that
he, she or it is capable of evaluating the risks and merits of his, her or its
investment in the Company and such Purchaser is able financially to bear the
risks thereof.
5. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASERS. The obligation of
each of the Purchasers to purchase Shares at the Closing is subject to the
fulfillment, or the waiver by such Purchaser, of each of the following
conditions on or before the Closing:
5.1. ACCURACY OF REPRESENTATIONS AND WARRANTIES. Each representation
and warranty contained in Section 3 shall be true on and as of the Closing Date
with the same effect as though such representation and warranty had been made on
and as of that date.
5.2. PERFORMANCE. The Company shall have performed and complied with
all agreements and conditions contained in this Agreement required to be
performed or complied with by the Company prior to or at the Closing.
5.3. OPINION OF COUNSEL. Each Purchaser shall have received an opinion
from Xxxx and Xxxx LLP, counsel for the Company, dated the Closing Date,
addressed to the Purchasers, and satisfactory in form and substance to each
Purchaser, to the effect set forth in EXHIBIT E.
5.4. ANCILLARY AGREEMENTS.
(a) STOCKHOLDERS' VOTING AGREEMENT. The Stockholders' Voting
Agreement attached hereto as EXHIBIT F (the "Stockholders' Voting Agreement")
shall have been
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executed and delivered by BayCorp and each of the Purchasers. All such action
shall have been taken as may be necessary to elect a Board of Directors of the
Company, effective upon the Closing, in accordance with the Stockholders' Voting
Agreement.
(b) INVESTOR RIGHTS AGREEMENT. The Investor Rights Agreement
attached hereto as EXHIBIT G (the "Investor Rights Agreement") shall have been
executed and delivered by the Company and each of the Purchasers.
(c) CO-SALE AGREEMENT. The Right of First Refusal and Co-Sale
Agreement attached hereto as EXHIBIT H (the "Co-Sale Agreement") shall have been
executed and delivered by each of the Purchasers and the other parties named
therein.
5.5. CERTIFICATES AND DOCUMENTS. The Company shall have made available
to the Purchasers:
(a) The Certificate of Incorporation of the Company, as amended
and in effect as of the Closing Date, certified by the Secretary of State of the
State of Delaware;
(b) Certificates, as of the most recent practicable dates, as to
the corporate good standing of the Company issued by the Secretary of State of
the State of Delaware, the Secretary of State of the State of New Hampshire and
the Secretary of State of the State of Texas;
(c) By-laws of the Company, certified by its Secretary or
Assistant Secretary as of the Closing Date;
(d) Resolutions of the Board of Directors of the Company,
authorizing and approving all matters in connection with this Agreement and the
Ancillary Agreements and the transactions contemplated hereby and thereby,
certified by the Secretary or Assistant Secretary of the Company as of the
Closing Date; and
(e) A Certificate of an officer of BayCorp certifying BayCorp's
approval of the transactions contemplated by the Agreement and the Ancillary
Agreements.
5.6. COMPLIANCE CERTIFICATES. The Company shall have delivered to the
Purchasers a certificate, executed by the President of the Company, dated the
Closing Date, certifying to the fulfillment of the conditions specified in
Sections 5.1, 5.2, 5.3, 5.4 and 5.5 of this Agreement.
5.7. OTHER MATTERS. All corporate and other proceedings in connection
with the transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be reasonably satisfactory in
substance and form to the Purchasers, and the Purchasers shall have received all
such counterpart originals or certified or other copies of such documents as
they may reasonably request.
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6. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY. The obligations of the
Company, with respect to each Purchaser, under Section 1.2 of this Agreement are
subject to fulfillment by that Purchaser, or the waiver by the Company, of the
following conditions on or before the Closing:
6.1. ACCURACY OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of such Purchaser contained in Section 4 shall be true on and as
of the Closing Date with the same effect as though such representations and
warranties had been made on and as of that date.
6.2. ANCILLARY AGREEMENTS.
(a) STOCKHOLDERS' VOTING AGREEMENT. The Stockholders' Voting
Agreement shall have been executed and delivered by BayCorp and such Purchaser.
All such action shall have been taken as may be necessary to elect a Board of
Directors of the Company, effective upon the Closing, in accordance with the
Stockholders' Voting Agreement.
(b) INVESTOR RIGHTS AGREEMENT. The Investor Rights Agreement
shall have been executed and delivered by the Company and such Purchaser.
(c) CO-SALE AGREEMENT. The Co-Sale Agreement shall have been
executed and delivered by such Purchaser.
6.3. OTHER MATTERS. All corporate and other proceedings in connection
with the transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be reasonably satisfactory in
substance and form to the Company, and the Company shall have received all such
counterpart originals or certified or other copies of such documents from such
Purchaser as it may reasonably request.
7. AFFIRMATIVE COVENANTS OF THE COMPANY.
7.1. BOOKS AND RECORDS; INSPECTION. The Company shall keep, and shall
cause each of its subsidiaries (if, when and to the extent any such subsidiaries
are formed) to keep books and records reflecting all of its business affairs and
transactions in accordance with GAAP and shall permit each Purchaser that holds
at least 266,667 shares of Series A Preferred (as adjusted for stock splits,
stock dividends, recapitalizations and similar events) (each, a "Major
Purchaser"), or any authorized representative thereof, to visit and inspect the
properties of the Company and its subsidiaries (if, when and to the extent any
such subsidiaries are formed), including their respective corporate and
financial records, and to discuss their respective businesses and finances with
directors, officers and outside accountants of the Company, during normal
business hours following reasonable notice and as often as may be reasonably
requested.
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7.2. FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company shall
deliver to each Major Purchaser:
(a) within 90 days after the end of each fiscal year of the
Company, (i) an audited consolidated balance sheet of the Company and its
subsidiaries (if, when and to the extent any such subsidiaries are formed) as at
the end of such year and audited consolidated statements of income and of cash
flows of the Company and its subsidiaries (if, when and to the extent any such
subsidiaries are formed) for such year, certified by certified public
accountants of established national reputation selected by the Company, and
prepared in accordance with GAAP and (ii) an audit report on such financial
statements prepared by such accountants stating that (x) the examination by such
accountants with respect to such financial statements was made in accordance
with generally accepted auditing standards and (y) in the opinion of such
accountants, such financial statements present fairly the financial position of
the Company and subsidiaries (if, when and to the extent any such subsidiaries
are formed), the results of their operations, and the changes in their financial
position as of the dates and for the periods of time covered thereby in
conformity with GAAP;
(b) within 45 days after the end of each fiscal quarter of the
Company (other than the fourth quarter), an unaudited consolidated balance sheet
of the Company and its subsidiaries (if, when and to the extent any such
subsidiaries are formed) as at the end of such quarter, and unaudited
consolidated statements of income and of cash flows of the Company and its
subsidiaries (if, when and to the extent any such subsidiaries are formed) for
such fiscal quarter and for the current fiscal year to the end of such fiscal
quarter. Such balance sheet and income and cash flow statements shall be
certified on behalf of the Company by an appropriate officer of the Company as
complete and accurate to the best of such officer's information and belief,
subject to normal year-end adjustments;
(c) promptly upon receipt thereof, any additional written
reports, management letters or other written detailed information concerning
significant aspects of the Company's operations and financial affairs, in each
case provided to the Company in final form by its independent accountants (and
not otherwise contained in other materials provided hereunder); and
(d) as soon as practicable after a request by any Major
Purchaser, the Company shall provide such Major Purchaser, at such Major
Purchaser's expense, with such information as it may reasonably require in order
to effect timely and proper filing of any reports that such Major Purchaser is
required to submit to any governmental authority or its affiliates in connection
with the business of the Company or any subsidiary (if, when and to the extent
any such subsidiaries are formed) of the Company.
7.3. MATERIAL CHANGES AND LITIGATION. The Company shall promptly (but
in any event within five business days following the occurrence) notify each
Major Purchaser of the default by the Company or any subsidiary (if, when and to
the extent any such subsidiaries are formed) in the repayment of any
indebtedness for borrowed money or any event that has had or in the Company's
good faith judgment, is likely to have a material adverse effect on the
business,
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prospects, assets or financial condition of the Company and of any material
litigation or material governmental proceeding or investigation brought or, to
the Company's knowledge, threatened against the Company, or against any officer,
director or key employee of the Company which, if adversely determined, would
reasonably be expected to have a Company Material Adverse Effect.
7.4. KEY MAN INSURANCE. Promptly after the Closing (but in no event
later than three months after the Closing) and for the period commencing on such
date and ending three years after the Closing Date, the Company shall use
commercially reasonable efforts to obtain and maintain, and continue to pay the
premiums on, a key man term life insurance policy from financially sound and
reputable insurers on the life of Xxxxx X. Xxxxxx Xx. for so long as he is
employed by the Company (or by BayCorp while devoting substantial time to the
business of the Company), in the amount of $5,000,000. The Company shall not
assign, grant a Security Interest in, borrow against or pledge such policy.
7.5. DIRECTORS. The Company shall promptly reimburse in full each
director of the Company who is not an employee of the Company and who was
elected as a director solely or in part by the holders of Series A Preferred for
all of his or her reasonable out-of-pocket expenses incurred in attending each
meeting of the Board of Directors of the Company or any committee thereof.
7.6. RESERVATION OF COMMON STOCK; NO INTEGRATION. The Company shall at
all times reserve and maintain a sufficient number of shares of Common Stock for
issuance upon conversion of all of the outstanding Shares. The Company will not
offer, sell or issue any securities within six months after the date hereof that
would be integrated (within the meaning of Rule 502(a) under the Securities Act)
with the offer and sale of Series A Preferred under this Agreement in a manner
that would cause the offer or sale of Series A Preferred under this Agreement to
no longer be exempt from registration under the Securities Act.
7.7. CORPORATE EXISTENCE; CODE OF CONDUCT. The Company will maintain
its corporate existence in full force and effect. The Company will adopt and
will maintain in full force and effect a Code of Conduct substantially in the
form attached hereto as EXHIBIT I.
7.8. TAXES. The Company will, and will cause each of its subsidiaries
(if, when and to the extent such subsidiaries are formed) to, timely pay and
discharge, or cause to be timely paid and discharged, all taxes (including all
employment and payroll taxes), assessments and other governmental charges
imposed upon them or any of their properties or in respect of their franchises
or income; provided, however, that no such tax or charge need be paid if being
contested in good faith by proceedings diligently conducted and if such
reservation or other appropriate provisions, if any, as shall be required by
GAAP shall have been made therefor.
7.9. COMPLIANCE WITH LAW. The Company will, and will cause its
subsidiaries (if, when and to the extent such subsidiaries are formed) to,
comply in all material respects with all applicable laws (whether federal, state
or local and whether statutory, administrative or judicial or other) and with
every applicable lawful governmental order (whether administrative
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or judicial) for which the failure to comply would reasonably be expected to
have a Company Material Adverse Effect.
7.10. TERMINATION OF COVENANTS. The covenants of the Company contained
in Sections 7.1 through 7.9 shall terminate, and be of no further force or
effect, upon the closing of the Company's first underwritten public offering of
Common Stock pursuant to an effective registration statement under the
Securities Act, resulting in gross proceeds to the Company of at least
$25,000,000, at a price to the public of at least $9.50 per share (as adjusted
for stock splits, stock dividends, recapitalizations and similar events) or
which otherwise results in the conversion of all Series A Preferred to Common
Stock.
8. TRANSFER OF SHARES.
8.1. RESTRICTED SHARES. "Restricted Shares" means (i) the Shares, (ii)
the shares of Common Stock issued or issuable upon conversion of the Shares,
(iii) any shares of capital stock of the Company acquired by the Purchasers
pursuant to the Investor Rights Agreement or Co-Sale Agreement and (iv) any
other shares of capital stock of the Company issued in respect of such shares
(as a result of stock splits, stock dividends, reclassifications,
recapitalizations or similar events); PROVIDED, HOWEVER, that Restricted Shares
shall cease to be Restricted Shares (x) upon any sale pursuant to a registration
statement under the Securities Act, Section 4(1) of the Securities Act or Rule
144 under the Securities Act or (y) at such time as they become eligible for
sale under Rule 144(k) under the Securities Act.
8.2. REQUIREMENTS FOR TRANSFER.
(a) Restricted Shares shall not be sold or transferred unless
either (i) they first shall have been registered under the Securities Act or
(ii) the Company first shall have been furnished with an opinion of legal
counsel or other written evidence reasonably satisfactory to the Company, to the
effect that such sale or transfer is exempt from the registration requirements
of the Securities Act.
(b) Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for (i) a transfer by a Purchaser which is a
corporation to a wholly owned subsidiary of such corporation, a transfer by a
Purchaser which is a partnership to a partner of such partnership or a retired
partner of such partnership who retires after the date hereof, or to the estate
of any such partner or retired partner, or a transfer by a Purchaser which is a
limited liability company to a member of such limited liability company or a
retired member who resigns after the date hereof or to the estate of any such
member or retired member; provided that the transferee in each case agrees in
writing to be subject to the terms of this Section 8 to the same extent as if it
were the original Purchaser hereunder or (ii) a transfer made in accordance with
Rule 144 under the Securities Act.
8.3. LEGEND. Each certificate representing Restricted Shares shall
bear a legend substantially in the following form:
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"The shares represented by this certificate have not been registered
under the Securities Act of 1933, as amended, and may not be offered,
sold or otherwise transferred, pledged or hypothecated unless and
until such shares are registered under such Act or an opinion of
counsel or other written evidence reasonably satisfactory to the
Company is obtained to the effect that such registration is not
required."
The Company shall cause the foregoing legend to be removed from the
certificates representing any Restricted Shares, at the request of the holder
thereof, at such time as they cease to be Restricted Shares.
8.4. RULE 144A INFORMATION. The Company shall, at all times during
which it is neither subject to the reporting requirements of Section 13 or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor
exempt from reporting pursuant to Rule 12g3-2(b) under the Exchange Act, upon
the written request of any Purchaser, provide in writing to such Purchaser and
to any prospective transferee of any Restricted Shares of such Purchaser the
information concerning the Company described in Rule 144A(d)(4) under the
Securities Act ("Rule 144A Information"). The Company also shall, upon the
written request of any Purchaser, cooperate with and assist such Purchaser or
any member of the National Association of Securities Dealers, Inc. PORTAL system
in applying to designate and thereafter maintain the eligibility of the
Restricted Shares for trading through PORTAL. The Company's obligations under
this Section 8.4 shall at all times be contingent upon receipt from the
Purchaser of a statement that the prospective transferee of Restricted Shares
has agreed in writing to take all reasonable precautions to safeguard the Rule
144A Information from disclosure to anyone other than persons who will assist
such transferee in evaluating the purchase of any Restricted Shares.
9. MISCELLANEOUS.
9.1. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors and
permitted assigns. This Agreement, and the rights and obligations of each
Purchaser hereunder, may be assigned by such Purchaser to any person or entity
to which Shares are transferred by such Purchaser, and such transferee shall be
deemed a "Purchaser" for purposes of this Agreement; provided that the
transferee provides written notice of such assignment to the Company. The
Company may not assign its rights under this Agreement.
9.2. CONFIDENTIALITY. Each Purchaser agrees that he, she or it will
keep confidential and will not disclose, divulge or use for any purpose other
than to monitor his, her or its investment in the Company any confidential,
proprietary or secret information which such Purchaser may obtain from the
Company pursuant to financial statements, reports and other materials submitted
by the Company to such Purchaser pursuant to this Agreement, or pursuant to
visitation or inspection rights granted hereunder ("Confidential Information"),
unless such Purchaser can demonstrate that such Confidential Information was
known by that Purchaser prior
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to disclosure by the Company to that Purchaser, or until such Confidential
Information becomes known, to the public (other than as a result of a breach of
this Section 9.2 by such Purchaser); PROVIDED, HOWEVER, that a Purchaser may
disclose Confidential Information (i) to its attorneys, accountants, consultants
and other professionals to the extent necessary to obtain their services in
connection with monitoring its investment in the Company, (ii) to any
prospective purchaser of any Shares from such Purchaser as long as such
prospective purchaser agrees in writing to be bound by the provisions of this
Section 9.2 or substantially equivalent provisions, (iii) to any affiliate of
such Purchaser or to a partner, stockholder or subsidiary of such Purchaser or
their respective employees, representatives or agents, provided that any such
person or entity agrees to be bound by the provisions of this Section 9.2 or
substantially equivalent provisions, (iv) as may otherwise be required by law or
court order, (v) in any report, statement or testimony submitted to any
regulatory body having or claiming to have jurisdiction over such Purchaser or
its affiliates if and only to the extent such disclosure is required by law or
court order, (vi) in response to any summons, subpoena or other legal process or
in connection with any other judicial proceeding or inquiry, (vii) in connection
with the preservation, exercise or enforcement of any of such Purchaser's rights
or remedies under this Agreement or any other Ancillary Agreement or (viii) to
correct any materially false or materially misleading information which may
become public concerning such Purchaser's relationship to the Company or its
affiliates or the transactions contemplated by this Agreement, provided that in
all cases the Purchaser takes reasonable steps to minimize the extent of any
such required disclosure.
9.3. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained herein (except for the Company's representations and
warranties set forth in Sections 3.2, 3.5, 3.11 and 3.12 and the first sentence
of Section 3.13(a)) shall survive the execution and delivery of this Agreement
and the Closing until the third anniversary of the Closing. Any valid claim that
is properly asserted in writing prior to the third anniversary of the Closing
shall survive until such claim is finally resolved and satisfied. The Company's
representations and warranties set forth in Sections 3.2, 3.5, 3.11 and 3.12 and
the first sentence of Section 3.13(a) shall survive the execution and delivery
of this Agreement and the Closing without limitation.
9.4. BROKERS. Each party hereto (i) represents and warrants to the
other parties hereto that he, she or it has not retained a finder or broker in
connection with the transactions contemplated by this Agreement and (ii) will
indemnify and save the other parties harmless from and against any and all
claims, liabilities or obligations with respect to brokerage or finders' fees or
commissions or consulting fees in connection with the transactions contemplated
by this Agreement asserted by any person on the basis of any statement or
representation alleged to have been made by such indemnifying party.
9.5. SEVERABILITY. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
9.6. SPECIFIC PERFORMANCE. In addition to any and all other remedies
that may be available at law in the event of any breach of this Agreement, each
Purchaser shall be entitled
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to specific performance of the agreements and obligations of the Company
hereunder and to such other injunctive or other equitable relief as may be
granted by a court of competent jurisdiction.
9.7. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of Delaware (without reference
to the conflicts of law provisions thereof).
9.8. NOTICES. All notices, requests, consents, and other
communications under this Agreement shall be in writing and shall be deemed
delivered (i) three business days after being sent by certified mail, return
receipt requested, postage prepaid or (ii) one business day after being sent via
a reputable nationwide overnight courier service guaranteeing next business day
delivery, in each case to the intended recipient as set forth below:
If to the Company, at 0 Xxxxxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxx
Xxxxxxxxx 00000, Attention: President, or at such other address or addresses as
may have been furnished in writing by the Company to the Purchasers, with a copy
to Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention:
Xxxxx X. Xxxxxxx, Esq.; or
If to a Purchaser, at the address set forth on EXHIBIT A for such
Purchaser, or at such other address or addresses as may have been furnished to
the Company in writing by such Purchaser.
Any party may give any notice, request, consent or other communication
under this Agreement using any other means (including, without limitation,
personal delivery, messenger service, telecopy, first class mail or electronic
mail), but no such notice, request, consent or other communication shall be
deemed to have been duly given unless and until it is actually received by the
party for whom it is intended. Any party may change the address to which
notices, requests, consents or other communications hereunder are to be
delivered by giving the other parties notice in the manner set forth in this
Section.
9.9. COMPLETE AGREEMENT. This Agreement (including its Exhibits) and
the Ancillary Agreements constitute the entire agreement and understanding of
the parties hereto with respect to the subject matter hereof and supersedes all
prior agreements and understandings relating to such subject matter.
9.10. AMENDMENTS AND WAIVERS. Except as otherwise expressly set forth
in this Agreement, any term of this Agreement may be amended or terminated and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), with the
written consent of the Company and the holders of 75% of the shares of Common
Stock issued or issuable upon conversion of the Shares. Notwithstanding the
foregoing, this Agreement may be amended with the consent of the holders of less
than all of the shares of Common Stock issued or issuable upon conversion of the
Shares only in a manner which applies to all such holders in the same fashion.
Any amendment, termination or waiver effected in accordance with this Section
9.10 shall be binding upon each holder of any Shares (including shares of Common
Stock into which such Shares have been converted), even if they do not execute
such consent, each future holder of all such securities and the Company. No
waivers of or exceptions to any term, condition or provision of this
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Agreement, in any one or more instances, shall be deemed to be, or construed as,
a further or continuing waiver of any such term, condition or provision.
9.11. PRONOUNS. Whenever the context may require, any pronouns used in
this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.
9.12. COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement may be
executed in any number of counterparts, each of which shall be deemed to be an
original, and all of which shall constitute one and the same document. This
Agreement may be executed by facsimile signatures.
9.13. SECTION HEADINGS. The section headings are for the convenience
of the parties and in no way alter, modify, amend, limit or restrict the
contractual obligations of the parties.
10. DEFINITIONS. For purposes of this Agreement, each of the following
defined terms is defined in the Section of this Agreement indicated below:
Defined Term Section
------------ -------
Ancillary Agreements 2(b)
Balance Sheet 3.9
Balance Sheet Date 3.9
BayCorp Recitals
Certificate of Incorporation 1.1
Closing 2
Closing Date 2
Co-Sale Agreement 5.4(c)
Common Stock Recitals
Company Introduction
Company Material Adverse Effect 3
Confidential Information 9.2
Equiva Recitals
Equiva Common Stock Purchase Recitals
Exchange Act 8.4
Financial Statements 3.9
GAAP 3.9
Governmental Entity 3.6
Intellectual Property 3.13(a)
Investor Rights Agreement 5.4(b)
Major Purchaser 7.1
Purchase Price 1.2
Purchaser Introduction
Restricted Shares 8.1
Rule 144A Information 8.4
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Securities Act 3.15
Security Interest 3.4
Series A Preferred 1.1
Shares 1.2
Stockholders' Voting Agreement 5.4(a)
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IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto
as of the day and year first above written.
[Use common/shared signature block file]
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