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EXHIBIT 10.1
COMMON STOCK PURCHASE AGREEMENT
BETWEEN
THE ASHTON TECHNOLOGY GROUP, INC.
(THE COMPANY)
AND
CALP II LIMITED PARTNERSHIP
(THE PURCHASER)
DATED AS OF FEBRUARY 5, 2001
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COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (this "Agreement") is made and
entered into as of February 5, 2001 (the "Effective Date"), between The Ashton
Technology Group, Inc. (the "Company"), a Delaware corporation, and CALP II
Limited Partnership (the "Purchaser"), a Bermuda limited partnership.
BACKGROUND
The Company has authorized the issuance, sale, and delivery of
1,333,333 shares (the "Shares") of the Company's Common Stock, par value $0.01
("Common Stock") at a price per Share of $1.50, in currency of the United States
of America, for a total purchase price of U.S. $2,000,000. The Purchaser wishes
to purchase the Shares upon the terms and conditions stated in this Agreement.
The Purchaser is purchasing the Shares in reliance upon an exemption from the
registration requirements of Section 5 of the U.S. Securities Act of 1933, as
amended (the "Securities Act"), in reliance upon the safe harbor afforded by
Rule 903 promulgated by the U.S. Securities and Exchange Commission (the "SEC").
AGREEMENT
For and in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Purchaser
hereby agree as follows:
SECTION 1. ISSUANCE AND SALE OF COMMON STOCK
1.1. The Company agrees to issue and sell the Shares to the Purchaser
and the Purchaser agrees to purchase the Shares from the Company, at the
Closing, for the Purchase Price of U.S.$2,000,000.
1.2. At the Closing, the Company agrees to issue and deliver to the
Purchaser a certificate for the Shares, registered in the Purchaser's name, free
and clear of any claims, and containing a legend complying with the requirements
of SEC Rule 903(b)(3)(iii)(B)(3) and the Purchaser agrees to deliver the
Purchase Price to the Company.
RIDER A
1.3. The closing of the transactions contemplated by this Agreement
(the "Closing") shall take place at a mutually agreed upon time, date and place.
SECTION 2. PURCHASER'S REPRESENTATIONS AND WARRANTIES.
2.1. The Purchaser represents and warrants to the Company that:
(a) The Purchaser is not a U.S. person (a "U.S. Person") as
defined in SEC Rule 902(k).
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(b) The offer to sell the Shares to the Purchaser was made
outside the United States.
(c) The Purchaser's buy order for the Shares was made outside
the United States.
(d) The Purchaser has complied with all of the conditions
required of it by SEC Regulation S in connection with its purchase of
the Shares.
(e) The Purchaser is acquiring the Shares for investment, and
not with a view towards or for resale in connection with the public
sale or distribution thereof in the United States, or to or for the
account of a U.S. person; provided, however, that by making this
representation, the Purchaser does not agree to hold any Shares for any
minimum or other specific term.
(f) The Purchaser is an "accredited investor" as that term is
defined in Rule 501(a)(3) of Regulation D promulgated under the
Securities Act.
RIDER B
(g) The Purchaser understands that the Shares are being
offered and sold to it in reliance upon specific exemptions from the
registration requirements of United States federal and state securities
laws and that the Company is relying upon the truth and accuracy of,
and the Purchaser's compliance with, the representations, warranties,
agreements, acknowledgements, and understandings of the Purchaser set
forth herein in order to determine the availability of such exemptions
and the eligibility of the Purchaser to acquire the Shares.
(h) The Purchaser and its advisors, if any, have been
furnished with all materials relating to the proposed business,
financial condition, and operations of the Company and materials
relating to the offer and sale of the Shares, which have been requested
by the Purchaser. The Purchaser and its advisors, if any, have been
afforded the opportunity to ask questions of the Company; provided,
however, neither such inquiries nor any other due diligence
investigations conducted by the Purchaser or its advisors, if any, or
its representatives shall modify, amend, or affect the Purchaser's
right to rely on the Company's representations and warranties contained
in Section 3 below. The Purchaser understands that its investment in
the Shares involves a high degree of risk. The Purchaser has sought
such accounting, legal, and tax advice as it has considered necessary
to make an informed investment decision with respect to its acquisition
of the Shares.
(i) The Purchaser understands that no United States federal or
state agency or any other government or governmental agency has passed
on or made any recommendation or endorsement of the Shares, or the
fairness or suitability of the investment in the Shares, nor have such
authorities passed upon or endorsed the merits of the offering of the
Shares.
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RIDER C
(j) The Purchaser understands that (i) the sale or re-sale of
the Shares has not been registered under United States federal or state
securities laws, and the Shares may not be transferred unless (a) the
Shares are sold pursuant to an effective registration statement under
the Securities Act, (b) the Purchaser shall have delivered to the
Company an opinion of counsel (which opinion shall be in form,
substance and scope customary for opinions of counsel in comparable
transactions) to the effect that the Shares to be sold or transferred
may be sold or transferred pursuant to an exemption from such
registration, (c) the Shares are sold or transferred to an "affiliate"
(as defined in Rule 144 promulgated under the Securities Act (or a
successor rule) ("Rule 144")) of the Purchaser who agrees to sell or
otherwise transfer the Shares only in accordance with this Section 2(j)
and who is an "accredited investor" as that term is defined in Rule
501(a) of Regulation D promulgated under the Securities Act, or (d) the
Shares are sold pursuant to Rule 144; (ii) any sale of such Shares made
in reliance on Rule 144 may be made only in accordance with the terms
of Rule 144 and further, if Rule 144 is not applicable, any re-sale of
such Shares under circumstances in which the seller (or the person
through whom the sale is made) may be deemed to be an underwriter (as
that term is defined in the Securities Act) may require compliance with
some other exemption under the Securities Act or the rules and
regulations of the SEC thereunder; and (iii) neither the Company nor
any other person is under any obligation to register such Shares under
the Securities Act or any state securities laws or to comply with the
terms and conditions of any exemption thereunder (in each case, other
than pursuant to Section 4.1 hereof). Notwithstanding the foregoing or
anything else contained herein to the contrary, the Shares may be
pledged as collateral in connection with a bona fide margin account or
other lending arrangement.
(k) The Purchaser understands that the Shares may bear a
restrictive legend in substantially the following form (and a
stop-transfer order may be placed against transfer of the certificates
for such Shares:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended. The
securities may not be sold, transferred or assigned in the
absence of an effective registration statement for the
securities under said Act, or an opinion of counsel, in form,
substance and scope customary for opinions of counsel in
comparable transactions, that registration is not required
under said Act or unless sold pursuant to Rule 144 under said
Act."
The legend set forth above shall be removed and the Company
shall issue a certificate without such legend to the holder of any Share upon
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which it is stamped, if, unless otherwise required by applicable state
securities laws, (a) such Share is registered for sale under an effective
registration statement filed under the Securities Act or otherwise may be sold
pursuant to Rule 144 without any restriction as to the number of securities as
of a particular date that can then be immediately sold, or (b) such holder
provides the Company with an opinion of counsel, in form, substance and scope
customary for opinions of counsel in comparable transactions, to the effect that
a public sale or transfer of such Share may be made without registration under
the Securities Act and such sale or transfer is effected, or (c) such holder
provides the Company with reasonable assurances that such Share can be sold
pursuant to Rule 144. The Purchaser agrees to sell all Shares including those
represented by a certificate(s) from which the legend has been removed, in
compliance with applicable prospectus delivery requirements, if any.
(l) This Agreement has been duly and validly authorized,
executed, and delivered on behalf of the Purchaser and is a valid and
binding agreement of the Purchaser enforceable in accordance with its
terms, subject as to enforceability to general principles of equity and
to applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, and other similar laws relating to, or affecting
generally, the enforcement of applicable creditors' rights and
remedies.
(m) The Purchaser is a limited partnership organized under the
laws of Bermuda.
(n) The Purchaser's acquisition of the Shares is not a
transaction (or any element of a series of transactions) that is part
of a plan or scheme by the Purchaser to evade the registration
provisions of the Securities Act.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
3.1. The Company represents and warrants to the Purchaser that:
(a) The Company is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware,
and has the requisite corporate power to own its properties and to
carry on its business as now being conducted.
(b) The Company has the requisite corporate power and
authority to enter into and perform this Agreement and to issue the
Shares.
(c) The execution and delivery of this Agreement by the
Company, and the consummation by it of the transactions contemplated
hereby, including without limitation the issuance of the Shares, have
been duly authorized by the Company's Board of Directors and no further
consent or authorization is required by the Company, its Board of
Directors or its stockholders.
(d) This Agreement has been duly executed and delivered by the
Company and the persons signing on behalf of the Company have full
power and authority to do so.
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(e) This Agreement constitutes the valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by general
principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation, or similar laws relating to,
or affecting generally, the enforcement of creditors' rights and
remedies.
(f) The Shares are duly authorized and, upon issuance in
accordance with the terms hereof, shall be validly issued, fully paid,
and nonassessable, and free from all taxes, liens, and charges with
respect to the issue thereof.
(g) The execution, delivery, and performance of this Agreement
by the Company, and the consummation by the Company of the transactions
contemplated hereby, will not (i) result in a violation of the
Certificate of Incorporation, any Certificate of Designation applicable
to any Preferred Stock of the Company, or the Bylaws of the Company or
(ii) conflict with, constitute a default (or an event which with notice
or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration, or
cancellation of, any agreement, indenture, or instrument to which the
Company is a party, or result in a violation of any law, rule,
regulation, order, judgment, or decree (including federal and state
securities laws and regulations) applicable to the Company or by which
any property or asset of the Company is bound or affected.
(h) The Company acknowledges and agrees that the Purchaser is
acting solely in the capacity of an arm's length purchaser with respect
to this Agreement and the transactions contemplated hereby. The Company
further acknowledges that the Purchaser is not acting as a financial
advisor or fiduciary of the Company (or in any similar capacity) with
respect to this Agreement or the transactions contemplated herein. The
Company's decision to enter into this Agreement has been based solely
on the independent evaluation by the Company and its representatives.
(i) Neither the Company, nor any of its affiliates, nor any
person acting on its or their behalf (i) has engaged in any form of
general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act) in connection with the offer or
sale of the Shares; or (ii) has directly or indirectly made any offers
or sales of any security or solicited any offers to buy any security,
under circumstances that would require registration of the Shares under
the Securities Act or cause this offering of the Shares to be
integrated with prior offerings by the Company for purposes of the
Securities Act or any applicable stockholder approval provisions.
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(j) The Company understands that the Purchaser is purchasing
the Shares in reliance on the exemption from the registration
requirements of Section 5 of the Securities Act for offshore
transactions as defined in SEC Rule 902(h), and that the Purchaser is
relying in part upon the truth and accuracy of, and the Company's
compliance with, the representations, warranties, agreements,
acknowledgments, and understandings of the Company set forth herein in
order to determine the availability of such exemptions and the
eligibility of the Company to issue and sell the Shares to the
Purchaser without having complied with those registration requirements.
With respect to that exemption, the Company further represents and
warrants to the Purchaser that (i) the Company has not offered any of
the Shares to a U.S. Person (as defined in SEC Rule 902(k)) or to a
person in the United States; (ii) the offer and sale of the Shares to
the Purchaser is being made in an offshore transaction as defined in
SEC Rule 902(h); (iii) the Company has not engaged in any directed
selling efforts, as defined in SEC Rule 902(c), with respect to the
Shares; and (iv) in offering and selling the Shares to the Purchaser,
the Company has complied with all of the conditions required of it
under SEC Regulation S.
(k) The Company is, and for more than the past 12 months it
continuously has been, a "reporting company" under the Securities and
Exchange Act of 1934, as amended (the "Exchange Act"), as defined by
the rules and regulations of the SEC and the NASD, and has filed in a
timely manner all reports and other information required by it to be
filed with the SEC under the Exchange Act in order to remain a
reporting company.
SECTION 4. REGISTRATION RIGHTS
4.1. As soon as is practicable after the Closing, the Company shall
file a registration statement (the "Registration Statement") with the SEC to
register the resale of the Shares, and shall use its best efforts to cause the
Registration Statement to become effective as soon as is reasonably practicable.
The Company shall use its best efforts to cause the registration statement to
remain effective for a period of one year from its effective date, or until the
Purchaser is no longer the owner of any Shares, whichever shall first occur.
SECTION 5. GENERAL PROVISIONS
5.1. This Agreement shall be governed by and interpreted in accordance
with the laws of the State of Delaware. The parties agree that the United States
District Court for the Southern District of New York, and the courts of the
State of New York located in the Borough of Manhattan, shall have exclusive
jurisdiction and venue for the adjudication of any civil action between them
arising out of relating to this Agreement, and hereby irrevocably consent to
such jurisdiction and venue.
5.2. This Agreement may be executed in counterparts, each of which
shall be deemed an original, and all of which hall be considered one and the
same agreement.
5.3. This agreement supersedes all other prior oral or written
agreements between the Purchaser, the Company, their affiliates and persons
acting on their behalf with respect to the issuance and sale of the Shares, and
this Agreement and the instruments referenced herein
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contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor any Purchaser makes any representation,
warranty, covenant, or undertaking with respect to such matters. No provision of
this Agreement may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.
5.4. Any notices, consents, waivers, or other communications required
or permitted to be given under the terms of this Agreement must be in writing
and will be deemed to have been delivered (a) upon receipt, when delivered
personally, (b) upon receipt, when sent by facsimile, (c) three (3) days after
being sent by certified mail, return receipt requested, or (d) one (1) day after
deposit with a nationally recognized overnight delivery service, in each case
properly addressed to the party to receive the same. The addresses and facsimile
numbers for such communications shall be:
If to the Company: If to the Purchaser:
The Ashton Technology Group, Inc. CALP II Limited Partnership
0000 Xxxxxx Xxxxxx, Xxxxx 000 c/o Forum Fund Services
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000 Xxxxxxxxxx Xxxx, 0xx Xxxxx
Facsimile: (215) ___-____ Xxxxxxxx, XX00, Bermuda
Facsimile: (000) 000-0000
5.5. This Agreement shall be binding upon and inure to the benefit of
the parties and their respective successors and assigns.
IN WITNESS WHEREOF, the Company and the Purchaser have caused this
Common Stock Purchase Agreement to be duly executed as of the Effective Date.
THE ASHTON TECHNOLOGY GROUP, INC. CALP II LIMITED PARTNERSHIP
By /s/ XXXXXX X. XXXXX By /s/ XXXX XXXXXXXXX
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Name Xxxxxx X. Xxxxx Name Xxxx Xxxxxxxxx
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Title President and COO Title Chairman
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