EXHIBIT 10.11
SEQUENOM, INC.
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STOCK PLEDGE AGREEMENT
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AGREEMENT made as of this __ day of _____________, 1999 by and between
Sequenom, Inc., a Delaware corporation (the "Corporation"), and _____________
("Pledgor").
RECITALS
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A. In connection with the purchase this day of _____________ (________)
shares of the Corporation's Common Stock (the "Purchased Shares") from the
Corporation, Pledgor has issued that certain promissory note (the "Note") dated
_____________, 1999 payable to the order of the Corporation in the principal
amount of _____________ Dollars ($________).
B. Such Note is secured by the Purchased Shares and other collateral upon
the terms set forth in this Agreement.
NOW, THEREFORE, it is hereby agreed as follows:
1. GRANT OF SECURITY INTEREST. Pledgor hereby grants the Corporation
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a security interest in, and assigns, transfers to and pledges with the
Corporation, the following securities and other property (collectively, the
"Collateral"):
(i) the Purchased Shares delivered to and deposited with the
Corporation as collateral for the Note;
(ii) any and all new, additional or different securities or other
property subsequently distributed with respect to the Purchased
Shares which are to be delivered to and deposited with the
Corporation pursuant to the requirements of Paragraph 3 of this
Agreement;
(iii) any and all other property and money which is delivered to
or comes into the possession of the Corporation pursuant to the
terms of this Agreement; and
(iv) the proceeds of any sale, exchange or disposition of the
property and securities described in subparagraphs (i), (ii) or
(iii) above.
2. WARRANTIES. Pledgor hereby warrants that Pledgor is the owner of
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the Collateral and has the right to pledge the Collateral and that the
Collateral is free from all liens, adverse claims and other security interests
(other than those created hereby).
3. DUTY TO DELIVER. Any new, additional or different securities or
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other property (other than regular cash dividends) which may now or hereafter
become distributable with respect to the Collateral by reason of (i) any stock
split, stock dividend, recapitalization, combination of shares, exchange of
shares or other change affecting the Common Stock as a class without the
Corporation's receipt of consideration or (ii) any merger, consolidation or
other reorganization affecting the capital structure of the Corporation shall,
upon receipt by Pledgor,
be promptly delivered to and deposited with the Corporation as part of the
Collateral hereunder. Any such securities shall be accompanied by one or more
properly-endorsed stock power assignments.
4. PAYMENT OF TAXES AND OTHER CHARGES. Pledgor shall pay, prior to
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the delinquency date, all taxes, liens, assessments and other charges against
the Collateral, and in the event of Pledgor's failure to do so, the Corporation
may at its election pay any or all of such taxes and other charges without
contesting the validity or legality thereof. The payments so made shall become
part of the indebtedness secured hereunder and until paid shall bear interest at
the minimum per annum rate, compounded semi-annually, required to avoid the
imputation of interest income to the Corporation and compensation income to
Pledgor under the Federal tax laws.
5. SHAREHOLDER RIGHTS. So long as there exists no event of default
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under Paragraph 10 of this Agreement, Pledgor may exercise all shareholder
voting rights and be entitled to receive any and all regular cash dividends paid
on the Collateral and all proxy statements and other shareholder materials
pertaining to the Collateral.
6. RIGHTS AND POWERS OF CORPORATION. The Corporation may, without
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obligation to do so, exercise at any time and from time to time one or more of
the following rights and powers with respect to any or all of the Collateral:
(i) subject to the applicable limitations of Paragraph 9, accept
in its discretion other property of Pledgor in exchange for all or
part of the Collateral and release Collateral to Pledgor to the
extent necessary to effect such exchange, and in such event the
other property received in the exchange shall become part of the
Collateral hereunder;
(ii) perform such acts as are necessary to preserve and protect
the Collateral and the rights, powers and remedies granted with
respect to such Collateral by this Agreement; and
(iii) transfer record ownership of the Collateral to the
Corporation or its nominee and receive, endorse and give receipt
for, or collect by legal proceedings or otherwise, dividends or
other distributions made or paid with respect to the Collateral,
provided and only if there exists at the time an outstanding event
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of default under Paragraph 10 of this Agreement. Any cash sums
which the Corporation may so receive shall be applied to the
payment of the Note and any other indebtedness secured hereunder,
in such order of application as the Corporation deems appropriate.
Any remaining cash shall be paid over to Pledgor.
Any action by the Corporation pursuant to the provisions of this
Paragraph 6 may be taken without notice to Pledgor. Expenses reasonably
incurred in connection with such action shall be payable by Pledgor and form
part of the indebtedness secured hereunder as provided in Paragraph 12.
7. CARE OF COLLATERAL. The Corporation shall exercise reasonable
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care in the custody and preservation of the Collateral. However, the
Corporation shall have no obligation to
(i) initiate any action with respect to, or otherwise inform Pledgor of, any
conversion, call, exchange right, preemptive right, subscription right, purchase
offer or other right or privilege relating to or affecting the Collateral, (ii)
preserve the rights of Pledgor against adverse claims or protect the Collateral
against the possibility of a decline in market value or (iii) take any action
with respect to the Collateral requested by Pledgor unless the request is made
in writing and the Corporation determines that the requested action will not
unreasonably jeopardize the value of the Collateral as security for the Note and
other indebtedness secured hereunder.
Subject to the limitations of Paragraph 9, the Corporation may at any
time release and deliver all or part of the Collateral to Pledgor, and the
receipt thereof by Pledgor shall constitute a complete and full acquittance for
the Collateral so released and delivered. The Corporation shall accordingly be
discharged from any further liability or responsibility for the Collateral, and
the released Collateral shall no longer be subject to the provisions of this
Agreement.
8. TRANSFER OF COLLATERAL. In connection with the transfer or
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assignment of the Note (whether by negotiation, discount or otherwise), the
Corporation may transfer all or any part of the Collateral, and the transferee
shall thereupon succeed to all the rights, powers and remedies granted the
Corporation hereunder with respect to the Collateral so transferred. Upon such
transfer, the Corporation shall be fully discharged from all liability and
responsibility for the transferred Collateral.
9. RELEASE OF COLLATERAL. Provided all indebtedness secured
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hereunder (other than payments not yet due and payable under the Note) shall at
the time have been paid in full and there does not otherwise exist any event of
default under Paragraph 10, the Purchased Shares, together with any additional
Collateral which may hereafter be pledged and deposited hereunder, shall be
released from pledge and returned to Pledgor in accordance with the following
provisions:
(i) Upon payment or prepayment of principal under the Note,
together with payment of all accrued interest to date on the
principal amount so paid or prepaid, one or more of the Purchased
Shares held as Collateral hereunder shall (subject to the
applicable limitations of Paragraphs 9(iii) and 9(v) below) be
released at the time of such payment or prepayment. The number of
the shares to be so released shall be equal to the number obtained
by multiplying (i) the total number of Purchased Shares held under
this Agreement at the time of the payment or prepayment, by (ii) a
fraction, the numerator of which shall be the amount of the
principal paid or prepaid and the denominator of which shall be
the unpaid principal balance of the Note immediately prior to such
payment or prepayment. In no event, however, shall any fractional
shares be released.
(ii) Any additional Collateral which may hereafter be pledged and
deposited with the Corporation (pursuant to the requirements of
Paragraph 3) with respect to the Purchased Shares shall be
released at the same time the particular shares of Common Stock to
which the additional Collateral relates are to be released in
accordance with the applicable provisions of Paragraph 9(i).
(iii) Under no circumstances, however, shall any Purchased
Shares or any other Collateral be released if previously applied
to the payment of any indebtedness secured hereunder. In addition,
in no event shall any Purchased Shares or other Collateral be
released pursuant to the provisions of Paragraph 9(i) or 9(ii) if,
and to the extent, the fair market value of the Common Stock and
all other Collateral which would otherwise remain in pledge
hereunder after such release were effected would be less than the
unpaid principal and accrued interest under the Note.
(iv) For all valuation purposes under this Agreement, the fair
market value per share of Common Stock on any relevant date shall
be determined in accordance with the following provisions:
(A) If the Common Stock is at the time traded on the Nasdaq
National Market, the fair market value shall be the closing
selling price per share of Common Stock on the date in
question, as such prices are reported by the National
Association of Securities Dealers on the Nasdaq National
Market. If there is no reported closing selling price for
the Common Stock on the date in question, then the closing
selling price on the last preceding date for which such
quotation exists shall be determinative of fair market
value.
(B) If the Common Stock is at the time listed on the
American Stock Exchange or the New York Stock Exchange, then
the fair market value shall be the closing selling price per
share of Common Stock on the date in question on the
securities exchange serving as the primary market for the
Common Stock, as such price is officially quoted in the
composite tape of transactions on such exchange. If there is
no reported sale of Common Stock on such exchange on the
date in question, then the fair market value shall be the
closing selling price on the exchange on the last preceding
date for which such quotation exists.
(C) If the Common Stock is at the time neither listed on any
securities exchange nor traded on the Nasdaq National
Market, the fair market value shall be determined by the
Corporation's Board of Directors after taking into account
such factors as the Board shall deem appropriate.
(v) In the event the Collateral becomes in whole or in part
comprised of "margin stock" within the meaning of Section 221.2 of
Regulation U of the Federal Reserve Board, then no Collateral
shall thereafter be substituted for any Collateral under the
provisions of Paragraph 6(i) or be released under Paragraph 9(i)
or (ii), unless there is compliance with each of the following
additional requirements:
(A) The substitution or release must not increase the amount
by which the indebtedness secured hereunder at the time of
such substitution or release exceeds the maximum loan value
(as defined below) of the Collateral immediately prior to
such substitution or release.
(B) The substitution or release must not cause the amount of
indebtedness secured hereunder at the time of such
substitution or release
to exceed the maximum loan value of the Collateral remaining
after, such substitution or release is effected.
(C) For purposes of this Paragraph 9(v), the maximum loan
value of each item of Collateral shall be determined on the
day the substitution or release is to be effected and shall,
in the case of the shares of Common Stock and any additional
Collateral (other than margin stock), equal the good faith
loan value thereof (as defined in Section 221.2 of
Regulation U) and shall, in the case of all margin stock
(other than the Common Stock), equal fifty percent (50%) of
the current market value of such stock.
10. EVENTS OF DEFAULT. The occurrence of one or more of the
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following events shall constitute an event of default under this Agreement:
(i) the failure of Pledgor to pay, when due under the Note, any
installment of principal or accrued interest; or
(ii) the occurrence of any other acceleration event specified in
the Note; or
(iii) the failure of Pledgor to perform any obligation imposed
upon Pledgor by reason of this Agreement; or
(iv) the breach of any warranty of Pledgor contained in this
Agreement.
Upon the occurrence of any such event of default, the Corporation may,
at its election, declare the Note and all other indebtedness secured hereunder
to become immediately due and payable and may exercise any or all of the rights
and remedies granted to a secured party under the provisions of the Delaware
Uniform Commercial Code (as now or hereafter in effect), including (without
limitation) the power to dispose of the Collateral by public or private sale or
to accept the Collateral in full payment of the Note and all other indebtedness
secured hereunder.
Any proceeds realized from the disposition of the Collateral pursuant
to the foregoing power of sale shall be applied first to the payment of expenses
incurred by the Corporation in connection with the disposition, then to the
payment of the Note and finally to any other indebtedness secured hereunder.
Any surplus proceeds shall be paid over to Pledgor. However, in the event such
proceeds prove insufficient to satisfy all obligations of Pledgor under the
Note, then Pledgor shall remain personally liable for the resulting deficiency.
11. OTHER REMEDIES. The rights, powers and remedies granted, to the
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Corporation pursuant to the provisions of this Agreement shall be in addition to
all rights, powers and remedies granted to the Corporation under any statute or
rule of law. Any forbearance, failure or delay by the Corporation in exercising
any right, power or remedy under this Agreement shall not be deemed to be a
waiver of such right, power or remedy. Any single or partial exercise of any
right, power or remedy under this Agreement shall not preclude the further
exercise thereof, and every right, power and remedy of the Corporation under
this
Agreement shall continue in full force and effect unless such right, power or
remedy is specifically waived by an instrument executed by the Corporation.
12. COSTS AND EXPENSES. All costs and expenses (including reasonable
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attorneys fees) incurred by the Corporation in the exercise or enforcement of
any right, power or remedy granted it under this Agreement shall become part of
the indebtedness secured hereunder and shall constitute a personal liability of
Pledgor payable immediately upon demand and bearing interest until paid at the
minimum per annum rate, compounded semi-annually, required to avoid the
imputation of interest income to the Corporation and compensation income to
Pledgor under the Federal tax laws.
13. APPLICABLE LAW. This Agreement shall be governed by and
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construed in accordance with the laws of the State of California without resort
to that State's conflict-of-laws rules.
14. SUCCESSORS. This Agreement shall be binding upon the Corporation
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and its successors and assigns and upon Pledgor and the executors, heirs and
legatees of Pledgor's estate.
15. SEVERABILITY. If any provision of this Agreement is held to be
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invalid under applicable law, then such provision shall be ineffective only to
the extent of such invalidity, and neither the remainder of such provision nor
any other provisions of this Agreement shall be affected thereby.
IN WITNESS WHEREOF, this Agreement has been executed by Pledgor and
the Corporation on this day of 1999.
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PLEDGOR
Address:
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AGREED TO AND ACCEPTED BY:
SEQUENOM, INC.
By:
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Title:
Dated: , 1999
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ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, _____________ hereby sell(s), assign(s) and transfer(s)
unto Sequenom, Inc. (the "Corporation"), _____________ (________) shares of the
Common Stock of the Corporation standing in his name on the books of the
Corporation represented by Certificate No. ________ herewith and do(e)s hereby
irrevocably constitute and appoint _____________ Attorney to transfer the said
stock on the books of the Corporation with full power of substitution in the
premises.
Dated:
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Signature:
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Schedule A.
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Form of Stock Pledge Agreement.
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Date Pledgor Purchased Shares Date of Note Amount of Note
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10/06/99 Xxxxxx Xxxxxx 680,000 10/06/99 $611,631
10/05/99 Xxxxx Xxxxxxxx 210,000 10/05/99 $143,346
10/09/99 Xxxxxxxx Xxxxx 280,000 10/09/99 $160,418
09/13/99 Xxxxxxx Xxxxxx 351,000 09/13/99 $468,901
07/01/99 Xxxxxxx Xxxxx 120,000 07/01/99 $ 42,380
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