Exhibit 10.1
SUBSCRIPTION AGREEMENT
This subscription agreement (this "Agreement") is dated as of August 30,
2002 between the buyers signatory hereto (each a "Buyer" and collectively the
"Buyers") and Cray Inc., a Washington corporation (the "Seller"), whereby the
parties agree as follows:
1. Subscription.
a) Each Buyer, severally and not jointly, agrees to buy, and the
Seller agrees to sell and issue to each Buyer, the number of
shares of the Seller's common stock set forth on the signature
page hereof opposite the name of each Buyer (collectively, the
"Shares"), on the date hereof, at a price equal to $3.40 per
share, or a total purchase price for each Buyer as set forth on
the signature page hereof opposite the name of such Buyer (the
"Purchase Price") along with warrants in the form of Exhibit B
attached hereto, to purchase up to, in the aggregate, 294,117
shares of the sellers common stock (the "Warrants"), which
Warrants shall be exercisable for a period of 4 years and have
an exercise price equal to $4.50, subject to adjustment therein.
The Warrants shall be issued to the investors pro-rata in
proportion to their purchases hereunder.
b) The Shares and Warrants have been registered on a Form S-3
registration statement, SEC File No. 333-89134, which
registration statement (the "Registration Statement") has been
declared effective by the Securities and Exchange Commission
(the "SEC"), has remained effective since such date and is
effective on the date hereof.
c) On the date hereof, the Seller shall deliver to each Buyer the
Shares purchased by such Buyer via the Depository Trust
Company's ("DTC") Deposit Withdrawal Agent Commission ("DWAC")
system via the DTC instructions for such Buyer set forth on the
signature page hereof and shall deliver the respective Warrants
to the Buyers at the address set forth on the signature page
hereto. The total Purchase Price payable by each Buyer as set
forth on the signature page hereof shall be paid by wire
transfer to the Seller on the date hereof pursuant to wire
instructions that have been provided to each Buyer. The Shares
must be unlegended and free of any resale restrictions. All
parties hereby agree and acknowledge that delivery of the Shares
via DTC's DWAC system is a material obligation of the Seller and
furthermore, with respect to the obligations of each party
hereunder, time is of the essence.
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d) Pursuant to SEC Rule 424(b)(2), the Seller agrees to file with
the SEC a prospectus supplement in the form of Exhibit A hereto
regarding the sale of the Shares and the Warrants to the Buyers.
2. Seller Representations and Warranties. The Seller represents and warrants to
each Buyer that: (a) it has full right, power and authority to enter into this
Agreement and to perform all of its obligations hereunder; (b) this Agreement
has been duly authorized and executed by the Seller and constitutes a valid and
binding agreement of the Seller enforceable against the Seller in accordance
with its terms, subject to general principles of equity and subject to
bankruptcy, insolvency, fraudulent transfer, moratorium and other similar laws
affecting the enforcement of creditors' right generally; (c) the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby do not result in a breach of (i) the Seller's articles of incorporation
or by-laws, or (ii) any agreement to which the Seller is a party or by which any
of its property or assets is bound; (d) upon issuance of the Shares and Warrants
to the Buyers for the total Purchase Price payable hereunder, the Shares and
Warrants will be duly and validly issued and outstanding and fully paid and
non-assessable, and, with respect to the Shares and the shares underlying the
Warrants upon exercise, each Buyer will be entitled to all rights accorded to a
holder of common stock of the Seller; and (e) the Registration Statement and the
final prospectus included therein do not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading in light of
the circumstances under which they were made.
3. Buyer Representations and Warranties. Each Buyer, severally and not jointly,
represents and warrants to the Seller that: (a) it has full right, power and
authority to enter into this Agreement and to perform all of its obligations
hereunder; (b) this Agreement has been duly authorized and executed by such
Buyer and constitutes a valid and binding agreement of such Buyer enforceable
against such Buyer in accordance with its terms, subject to general principles
of equity and subject to bankruptcy, insolvency, fraudulent transfer, moratorium
and other similar laws affecting the enforcement of creditors' right generally;
(c) the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby do not result in a breach of any agreement to
which such Buyer is a party or by which any of its property or assets is bound;
(d) such Buyer is, and since November 16, 2001 has been, a holder of securities
of the Seller, or such Buyer is an affiliate (as defined in SEC Rule 405 under
the Securities Act of 1933, as amended) of a person or entity that is, and since
November 16, 2001 has been, a holder of securities of the Seller; and (e) any
sale of the Shares by such Buyer will be in compliance with all applicable state
and federal securities laws.
4. Condition of the Seller. It shall be a condition of the obligations of the
Seller hereunder that the Seller receive not less than $10,000,000 in aggregate
gross proceeds from the sale of the Shares and Warrants to the Buyers pursuant
to this Agreement.
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5. Notice. All communications hereunder, except as may be otherwise specifically
provided herein, shall be in writing and shall be mailed, hand delivered, sent
by a recognized overnight courier service such as Federal Express, or sent via
facsimile and confirmed by letter, to the party to whom it is addressed at the
following addresses or such other address as such party may advise the other in
writing:
To the Seller: Cray Inc.
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attn: General Counsel
To any Buyer: as set forth on the signature page hereto.
All notices hereunder shall be effective upon receipt by the party to
which it is addressed.
6. Jurisdiction. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York for contracts to be wholly
performed in such state and without giving effect to the principles thereof
regarding the conflict of laws. Each of the parties consents to the exclusive
jurisdiction of the federal courts whose districts encompass any part of the
City of New York or the state courts of the State of New York sitting in the
City of New York in connection with any dispute arising under this Agreement and
hereby waives, to the maximum extent permitted by law, any objection based on
forum non conveniens, to the bringing of any such proceeding in such
jurisdiction. To the extent determined by such court, the prevailing party shall
reimburse the other party for any reasonable legal fees and disbursements
incurred in enforcement of, or protection of any of its rights under this
Agreement.
7. Miscellaneous.
a) This Agreement constitutes the entire understanding and
agreement between the parties with respect to its subject
matter, and there are no agreements or understandings with
respect to the subject matter hereof which are not contained in
this Agreement. This Agreement may be modified only in writing
signed by the party to be charged hereunder.
b) This Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same
instrument and shall become effective when counterparts have
been signed by each party and delivered to the other parties
hereto, it being understood that all parties need not sign the
same counterpart. Execution may be made by delivery by
facsimile.
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c) The provisions of this Agreement are severable and, in the event
that any court or officials of any regulatory agency of
competent jurisdiction shall determine that any one or more of
the provisions or part of the provisions contained in this
Agreement shall, for any reason, be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of
a provision of this Agreement and this Agreement shall be
reformed and construed as if such invalid or illegal or
unenforceable provision, or part of such provision, had never
been contained herein, so that such provisions would be valid,
legal and enforceable to the maximum extent possible, so long as
such construction does not materially adversely effect the
economic rights of any party hereto.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY BLANK]
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[Signature Pages to Subscription Agreement (pages 5-7)]
SELLER:
CRAY INC.
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxx, President
BUYERS:
RIVERVIEW GROUP, LLC Number of Common Shares:
1,772,533
Total Purchase Price: $6,026,613
By /s/ Xxxxx Xxxxxx Warrant Shares: 177,253
--------------------------------------
Name: Xxxxx Xxxxxx DTC Instructions:
Title: Chief Administrative Officer Solomon Xxxxx Xxxxxx
Acct Name: Riverview Group, LLC
Broker DTC #: 418
DTC Acct #: 52239606
Address for Notice:
000 0xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx Xxxxxxxx
OMICRON PARTNERS, LP Number of Common Shares: 632,511
By: Omicron Capital L.P., as subadvisor Total Purchase Price: $2,150,538
By: Omicron Capital Inc., general partner Warrant Shares: 63,251
By /s/ Xxxxx Xxxxxxxxx DTC Instructions:
--------------------------------------
Xxxxx Xxxxxxxxx, President
Address for Notice:
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
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LATERMAN & CO. Number of Common Shares: 62,500
Total Purchase Price: $212,500
Warrant Shares: 6,250
By /s/ Xxxxxxx Xxxxxxxx
-------------------------------------- DTC Instructions:
Xxxxxxx Xxxxxxxx, Managing Partner DTC Broker #: 551 (Xxxxxxx Xxxxx)
Account #: 082-43003-DO
Acct Name: Laterman & Co.
Address for Notice:
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
FOREVERGREEN PARTNERS Number of Common Shares: 62,500
Total Purchase Price: $212,500
Warrant Shares: 6,250
By /s/ Xxxxxxx Xxxxxxxx
--------------------------------------
Xxxxxxx Xxxxxxxx, Managing Partner DTC Instructions:
DTC Broker #: 551 (Xxxxxxx Xxxxx)
Acct #: 187-23077-D2
Acct Name: Forevergreen Partners
Address for Notice:
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
CLARION CAPITAL CORPORATION Number of Common Shares: 101,132
Total Purchase Price: $343,848.80
Warrant Shares: 10,113
By /s/ Xxxxxx X. Xxxxx
-------------------------------------- DTC Instructions:
Xxxxxx X. Xxxxx, President DTC Broker #: 773
DTC A/C: 11811651
Address for Notice:
0000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxx 00000
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CLARION PARTNERS, L.P. Number of Common Shares: 105,000
Total Purchase Price: $357,000
Warrant Shares:10,500
By /s/ Xxxxxx X. Xxxxx
-------------------------------------- DTC Instructions:
Name: Xxxxxx X. Xxxxx DTC Broker #: 773
Title: Manager DTC A/C: 11810005
Address for Notice:
Same as above
CLARION OFFSHORE FUND, LTD. Number of Common Shares: 105,000
Total Purchase Price: $357,000
Warrant Shares:10,500
By /s/ Xxxxxx X. Xxxxx
-------------------------------------- DTC Instructions:
Name: Xxxxxx X. Xxxxx DTC Broker #: 773
Title: President DTC A/C: 31311266
Address for Notice:
Same as above
DYNAMIC EQUITY HEDGE FUND Number of Common Shares: 50,000
Total Purchase Price: $170,000
Warrant Shares:5,000
By /s/ Xxxxxx X. Xxxxx
-------------------------------------- DTC Instructions:
Name: Xxxxxx X. Xxxxx DTC Broker #: 773
Title: Manager DTC A/C: 313315691
Address for Notice:
Same as above
GUARANTEE & TRUST CO TEE XXXXXX
X. XXXXX GTC XXX SEP Number of Common Shares: 50,000
Total Purchase Price: $170,000
Warrant Shares:5,000
By /s/ Xxxxxx X. Xxxxx
-------------------------------------- DTC Instructions:
Name: Xxxxxx X. Xxxxx DTC Broker #: 773
Title: Trustee DTC A/C: 1126083
Address for Notice: same as above
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Exhibit A
Prospectus Supplement
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