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SHARE EXCHANGE AGREEMENT
between
SIMTEK CORPORATION,
JASKARN JOHAL
and
KASHMIRA S. JOHAL
July 31, 2000
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TABLE OF CONTENTS
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ARTICLE I ACQUISITION................................................................................. 3
1.1 Acquisition of Stock................................................................. 3
1.2 Exchange............................................................................. 3
1.3 The Closing.......................................................................... 3
1.4 Tax and Accounting Consequences...................................................... 3
ARTICLE II REPRESENTATIONS AND WARRANTIES OR THE SHAREHOLDERS.......................................... 3
2.1 Binding Obligation; No Violation..................................................... 3
2.2 Stock................................................................................ 4
2.3 Brokers' and Finders' Fees........................................................... 4
2.4 Organization and Standing............................................................ 4
2.5 Capitalization....................................................................... 4
2.6 Subsidiaries......................................................................... 5
2.7 No Conflicts......................................................................... 5
2.8 Financial Statements................................................................. 5
2.9 Absence of Certain Changes........................................................... 5
2.10 Liabilities.......................................................................... 7
2.11 Litigation........................................................................... 7
2.12 Governmental Authorization........................................................... 7
2.13 Contracts and Commitments............................................................ 7
2.14 Title to Property.................................................................... 7
2.15 Intellectual Property................................................................ 8
2.16 Manufacture and Marketing Rights..................................................... 9
2.17 Environmental Matters................................................................ 9
2.18 Taxes................................................................................ 9
2.19 Employee Benefit Plans............................................................... 10
2.20 Employee Matters..................................................................... 10
2.21 Interested Party Transactions........................................................ 10
2.22 Insurance............................................................................ 10
2.23 Compliance With Laws................................................................. 10
2.24 Minutes Books........................................................................ 11
2.25 Public Filings....................................................................... 11
2.26 Disclosure........................................................................... 11
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SIMTEK.................................................... 11
3.1 Organization......................................................................... 11
3.2 Due Authorization.................................................................... 11
3.3 Duly Authorized, Fully Paid and Non-Assessable Stock................................. 12
3.4 Brokers' and Finders' Fees........................................................... 12
3.5 No Conflicts......................................................................... 12
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ARTICLE IV DELIVERIES AT CLOSING....................................................................... 12
4.1 Shareholders' Deliveries............................................................. 12
4.2 Simtek Deliveries.................................................................... 13
ARTICLE V ESCROW; REGISTRATION........................................................................ 13
5.1 Survival of Representations and Warranties........................................... 13
5.2 Indemnification and Escrow........................................................... 13
5.3 Indemnification by Simtek............................................................ 14
5.4 Indemnification Procedures........................................................... 14
5.5 Registration......................................................................... 14
ARTICLE VI GENERAL PROVISIONS.......................................................................... 14
6.1 Notices.............................................................................. 14
6.2 Interpretation....................................................................... 15
6.3 Counterparts......................................................................... 16
6.4 Entire Agreement; Nonassignability; Parties in Interest.............................. 16
6.5 Severability......................................................................... 16
6.6 Remedies Cumulative; No Waiver....................................................... 16
6.7 Governing Law........................................................................ 16
6.8 Further Assurances................................................................... 16
6.9 Amendment............................................................................ 17
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INDEX OF DEFINED TERMS
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Agreement.................................................................. 3
Annual Financial Statements................................................ 5
Closing.................................................................... 3
Closing Date............................................................... 3
Code....................................................................... 10
Company Authorizations..................................................... 7
Confidential Information................................................... 9
Damages.................................................................... 13
Employee Plans............................................................. 10
Escrow Right............................................................... 13
Escrow Shares.............................................................. 13
excess parachute payments.................................................. 10
Exchange................................................................... 3
Exchange Act Documents..................................................... 11
Governmental Entity........................................................ 4
include.................................................................... 15
includes................................................................... 15
including.................................................................. 15
indemnified party.......................................................... 14
indemnifying party......................................................... 14
Intellectual Property...................................................... 8
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Interim Financial Statements............................................... 5
J. Johal................................................................... 3
K. Johal................................................................... 3
knowledge.................................................................. 16
Lien....................................................................... 4
Macrotech.................................................................. 3
Macrotech Stock............................................................ 3
made available............................................................. 15
material................................................................... 15
Material Adverse Effect.................................................... 15
Registrable Securities..................................................... 21
Registration Expenses...................................................... 22
Schedule of Exceptions..................................................... 3
Securities Act............................................................. 4
Shareholders............................................................... 3
Simtek..................................................................... 3
Simtek Stock............................................................... 3
Tax........................................................................ 9
Tax authority.............................................................. 9
Taxable.................................................................... 9
Taxes...................................................................... 9
Third Party Action......................................................... 14
Third Party Intellectual Property Rights................................... 8
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SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT (this "Agreement") dated as of July 31, 2000,
is among SIMTEK CORPORATION, a Colorado corporation ("Simtek"), JASKARN JOHAL
("J. Johal") and KASHMIRA S. JOHAL ("K. Johal" and, together with J. Johal, the
"Shareholders"), the Shareholders being the only shareholders of MACROTECH
SEMICONDUCTOR, INC., a California corporation ("Macrotech").
ARTICLE I
ACQUISITION
1.1 ACQUISITION OF STOCK. Upon the terms and subject to the conditions of
this Agreement, the Shareholders will transfer to Simtek, and Simtek will
acquire from the Shareholders all of the issued and outstanding shares of Common
Stock, without par value, of Macrotech (the "Macrotech Stock").
1.2 EXCHANGE. In exchange for the acquisition by Simtek of the Macrotech
Stock, Simtek shall issue to the Shareholders (the "Exchange") in accordance
with this Agreement 1,250,000 shares of the Common Stock, $.01 par value per
share of Simtek ("Simtek Stock").
1.3 THE CLOSING. Subject to the terms and conditions of this Agreement, the
closing of the Exchange (the "Closing") shall take place at the offices of Holme
Roberts & Owen LLP, 90 South Cascade, Suite 1300, Colorado Springs, Colorado
80903 at 11:00 p.m., local time, on the date hereof (the "Closing Date").
1.4 TAX AND ACCOUNTING CONSEQUENCES.
(a) It is intended by the parties hereto that the Exchange shall
constitute a tax-free reorganization within the meaning of Section 368(a)(1)(B)
of the Code.
(b) It is intended by the parties hereto that the Exchange shall
qualify for accounting treatment as a pooling of interests.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OR THE SHAREHOLDERS
Except as set forth in the Schedule of Exceptions attached hereto as
Exhibit 2.0 (the "Schedule of Exceptions"), the Shareholders represent and
warrant to Simtek as set forth in this Article II.
2.1 BINDING OBLIGATION; NO VIOLATION. The Shareholders have taken all
actions necessary to secure all approvals required in connection with the
execution, delivery and performance of this Agreement. This Agreement has been
duly executed and delivered by the Shareholders and constitutes the valid and
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binding obligation of the Shareholders enforceable against the Shareholders in
accordance with its terms. The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated hereby will not, (a)
violate or conflict with any permit, order, license, decree, judgment, statute,
law, ordinance, rule or regulation applicable to the Shareholders or (b) result
in any breach or violation of, or constitute a default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of, or result in the creation of any mortgage,
pledge, lien, encumbrance, charge, or other security interest (a "Lien") on any
of the properties or assets of the Shareholders pursuant to, or require the
consent of any party to any mortgage, indenture, lease, contract or other
agreement or instrument, bond, note, concession or franchise applicable to the
Shareholders or any of their properties or assets, except, in the case of this
clause (b) only, where such conflict, violation, default, termination,
cancellation or acceleration would not have and could not reasonably be expected
to prevent the consummation of the transactions contemplated hereby. No consent,
approval, order or authorization of, or registration, declaration or filing
with, any court, administrative agency or commission or other governmental
authority or instrumentality ("Governmental Entity") is required in connection
with the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby.
2.2 STOCK. The Shareholders have good and marketable title to the Stock
free and clear of any restrictions on transfer (other than any restrictions
under the Securities Act of 1933, as amended (the "Securities Act") and state
securities laws); Taxes (as defined in Section 2.18); any Lien; and any option,
warrant, put, call, purchase right, equity, claim, demand, or other commitment
or agreement of any nature. The Shareholders are not parties to any option,
warrant, put, call, purchase right or other commitment or agreement that could
require the Shareholders to sell, transfer or otherwise convey any Stock, other
than pursuant to this Agreement.
2.3 BROKERS' AND FINDERS' FEES. The Shareholders have not incurred, or will
not incur, directly or indirectly, any liability for brokerage or finders' fees
or agents' commissions or investment bankers' fees or any similar charges in
connection with this Agreement or any transaction contemplated hereby.
2.4 ORGANIZATION AND STANDING. Macrotech is a corporation duly organized
and validly existing and in good standing under the laws of the State of
California, has the full corporate power to own its properties and to carry on
its business as now being conducted and as proposed to be conducted and is duly
qualified to do business and is in good standing in each jurisdiction in which
the failure to be so qualified and in good standing would have a Material
Adverse Effect (as defined in Section 6.2) on Macrotech. Macrotech has delivered
to Simtek a true and correct copy of it Articles of Incorporation and Bylaws,
each as amended to date. Macrotech is not in violation of any of the provisions
of its Articles of Incorporation or Bylaws.
2.5 CAPITALIZATION. The authorized capital stock of Macrotech consists of
10,000,000 shares of common stock, of which there are issued and outstanding
4,000,000 shares of common stock. There are no other outstanding shares of
capital stock or other securities of Macrotech and no outstanding subscriptions,
options, warrants, puts, calls, rights, exchangeable or convertible securities
or other commitments or agreements of any nature relating to the capital stock
or other securities of Macrotech, or otherwise obligating Macrotech to issue,
transfer, sell, purchase, redeem or otherwise acquire such stock or securities.
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All outstanding shares of Macrotech Stock are duly authorized, validly issued,
fully paid and non-assessable and are free and clear of any Lien and are not
subject to preemptive rights or rights of first refusal.
2.6 SUBSIDIARIES. Macrotech does not directly or indirectly own any equity
or similar interest in, or any interest convertible or exchangeable or
exercisable for, any equity or similar interest in, any corporation,
partnership, joint venture or other business association or entity.
2.7 NO CONFLICTS. The execution and delivery of this Agreement do not, and
the consummation of the transactions contemplated hereby will not, (a) conflict
with or violate any provision of the Articles of Incorporation or Bylaws of
Macrotech, (b) violate or conflict with any permit, order, license, decree,
judgment, statute, law, ordinance, rule or regulation applicable to Macrotech or
the properties or assets of Macrotech, or (c) result in any breach or violation
of, or constitute a default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancellation or acceleration of,
or result in the creation of any Lien on any of the properties or assets of
Macrotech pursuant to, or require the consent of any party to any mortgage,
indenture, lease, contract or other agreement or instrument, bond, note,
concession or franchise applicable to Macrotech or any of its properties or
assets.
2.8 FINANCIAL STATEMENTS. Macrotech has heretofore delivered to Simtek true
and complete copies of an unaudited balance sheet, and the related statements of
operations and stockholders' equity and of cash flows with separate disclosure
of the balance sheet and income and retained earnings of Macrotech as of and for
the year ended December 31, 1999 (the "Annual Financial Statements"), Macrotech
also has heretofore delivered to Simtek true copies of the unaudited balance
sheet of Macrotech at June 30, 2000, and the related unaudited statements of
income for the six months then ended (the "Interim Financial Statements"). The
Annual Financial Statements and the Interim Financial Statements are true and
correct in all material respects and were prepared on a basis consistent
throughout the periods indicated and consistent with each other.
2.9 ABSENCE OF CERTAIN CHANGES. Except as specifically permitted by this
Agreement or as set forth in Schedule 2.9 hereto, since June 30, 2000, Macrotech
has conducted its business in the ordinary course consistent with past practice
and there has not occurred:
(a) any change, event or condition (whether covered by insurance) that
has resulted in, or might reasonably be expected to result in, a Material
Adverse Effect on Macrotech;
(b) any sale, lease or other transfer or disposition of any property or
asset of Macrotech, except for the sale of inventory in the ordinary course of
business;
(c) any change in accounting methods, practices or policies (including
any change in depreciation or amortization policies or rates) by Macrotech or
any revaluation by Macrotech of any of its assets, except as described in the
notes to the Annual Financial Statements;
(d) any declaration, setting aside, or payment of any dividend or other
distribution to Macrotech's shareholders or any direct or indirect redemption,
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retirement, purchase or other acquisition by Macrotech of any of its capital
stock or other securities or options, warrants or other rights to acquire
capital stock;
(e) any entering into, amendment or termination of, or default under,
by Macrotech of any contract to which Macrotech is a party or by which it or any
of them is bound other than in the ordinary course of business and as provided
to Simtek;
(f) any material damage, destruction or loss (whether or not covered by
insurance) to the properties and assets of Macrotech;
(g) any commitment or transaction (including any capital expenditure,
capital financing or sale of assets) by Macrotech for any amount that requires
or could require payments in excess of $50,000 with respect to any individual
contract or a series of related contracts;
(h) any Lien on any asset allowed to exist by Macrotech;
(i) any cancellation of any debt or waiver or release of any right or
claim by Macrotech;
(j) any payment, discharge or satisfaction of any claim, liability or
obligation by Macrotech, other than as reflected or reserved against in the
Annual Financial Statements or the Interim Financial Statements or in the
ordinary course of business consistent with past practice;
(k) any labor dispute, litigation or governmental investigation
affecting the business or financial condition of Macrotech;
(l) any issuance or sale of capital stock or other securities,
exchangeable or convertible securities, options, warrants, puts, calls or other
rights to acquire capital stock or other securities of Macrotech;
(m) any indebtedness for borrowed money incurred, assumed or guaranteed
by Macrotech;
(n) any loan or advance (other than advances to employees in the
ordinary course of business for travel and entertainment in accordance with past
practice) to any person;
(o) any increase in any salary, wage, benefit or other remuneration
payable or to become payable to any current or former officer, director,
employee or agent of Macrotech or any bonus or severance payment or arrangement
made to, for or with any officer, director, employee or agent of Macrotech or
any supplemental retirement plan or other program or special remuneration for
any officer, director, employee or agent of Macrotech, except for normal salary
or wage increases relating to periodic performance reviews and annual bonuses
consistent with past practices of Macrotech;
(p) any grant of credit to any customer on terms or in amounts more
favorable than those which have been extended to such customer in the past, any
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other change in the terms of any credit heretofore extended or any other change
in the policies or practices of Macrotech with respect to the granting of
credit;
(q) any delay in the payment of any trade or other payables other than
in the ordinary course of business consistent with past practice; or
(r) any agreement, whether in writing or otherwise, by Macrotech to do
any of the foregoing.
2.10 LIABILITIES. Except as set forth in the Annual Financial Statements,
the Interim Financial Statements or Schedule 2.10 hereto and except for
liabilities or obligations arising in the ordinary course and consistent with
past practice and those incurred in connection herewith, Macrotech has no
liability or obligation of any nature, whether due or to become due, fixed or
contingent.
2.11 LITIGATION. Except as set forth on Schedule 2.11 hereto, there is no
private or governmental action, suit, proceeding, claim, arbitration or
investigation pending before any agency, court or tribunal or, to the knowledge
of any Shareholder, threatened against Macrotech or any of its assets and
properties. There is no judgment, decree or order against Macrotech or either of
the Shareholders, that could prevent consummation of the transactions
contemplated by this Agreement, or that could reasonably be expected to have a
Material Adverse Effect on Macrotech. There is no action, suit proceeding or
investigation by Macrotech currently pending or that Macrotech currently
intends.
2.12 GOVERNMENTAL AUTHORIZATION. Macrotech has obtained each federal,
state, county, local or foreign governmental consent, license, permit, grant, or
other authorization that are necessary for Macrotech to own or lease, operate
and use its assets and properties and to carry on its business as currently
conducted or as proposed to be conducted (collectively, the "Company
Authorizations"), Macrotech has performed and fulfilled its obligations under
Macrotech Authorizations, and all Macrotech Authorizations are in full force and
effect, except where the failure to obtain or have any of such Macrotech
Authorizations could not reasonably be expected to have a Material Adverse
Effect on Macrotech.
2.13 CONTRACTS AND COMMITMENTS. Schedule 2.13 hereto lists all material
agreements to which Macrotech is a party. True and complete copies of all
agreements described in Schedule 2.13 hereto have been delivered to Simtek.
Macrotech has fulfilled, or taken all actions necessary to enable it to fulfill
when due, its obligations under each of such agreements. All parties thereto
have complied in all material respects with the provisions thereof and no party
is in breach or violation of, or in default (with or without notice or lapse of
time, or both) under such agreements. With respect to such agreements, Macrotech
has not received any notice of termination, cancellation or acceleration or any
notice of breach, violation or default thereof.
2.14 TITLE TO PROPERTY. Except as set forth in Schedule 2.14 hereto,
Macrotech has good and marketable title to all of its properties and assets, or
in the case of leased properties and assets, valid leasehold interests in such
properties, free and clear of any Lien. The plants, property and equipment of
Macrotech that are used in the operations of its business are in good operating
condition and repair, subject to ordinary wear and tear. All plants, property
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and equipment have been well maintained and conform (to the best of the
Shareholders' knowledge as to leased real property) with all applicable
ordinances, regulations and zoning and other laws and do not encroach on the
property of others. There is no pending or, to the best of the knowledge of the
Shareholders, threatened change in any such ordinance, regulation or zoning or
other law, and there is no pending or, to the best of the knowledge of the
Shareholders, threatened condemnation of any such building, machinery or
equipment. The properties and assets of Macrotech include all rights,
properties, interests in properties and assets necessary to permit Macrotech to
conduct its business as currently conducted or as proposed to be conducted.
Schedule 2.14 hereto identifies each parcel of real property owned or leased by
Macrotech.
2.15 INTELLECTUAL PROPERTY.
(a) Macrotech owns, or is licensed or otherwise possess legally
enforceable rights to use, all patents, trademarks, trade names, service marks,
copyrights, and any applications therefor, maskworks, net lists, schematics,
technology, know-how, trade secrets, inventory, ideas, algorithms, processes,
computer software programs or applications (in both source code and object code
form), and tangible or intangible proprietary information or material
("Intellectual Property") that are used in the business of Macrotech as
currently conducted, except to the extent that the failure to have such rights
have not and could not reasonably be expected to have a Material Adverse Effect
on Macrotech.
(b) Schedule 2.15 hereto lists (i) all patents and patent applications
and all registered and unregistered trademarks, trade names and service marks,
registered and unregistered copyrights, and maskworks, which Macrotech considers
to be material to its business and included in the Intellectual Property,
including the jurisdictions in which each such Intellectual Property right has
been issued or registered or in which any application for such issuance and
registration has been filed, (ii) all material licenses, sublicenses and other
agreements as to which Macrotech is a party and pursuant to which any person is
authorized to use any Intellectual Property, and (iii) all material licenses,
sublicenses and other agreements as to which Macrotech is a party and pursuant
to which Macrotech is authorized to use any third party patents, trademarks or
copyrights, including software ("Third Party Intellectual Property Rights"), in
each case which are incorporated in, are, or form a part of any product or
service of Macrotech.
(c) To the knowledge of the Shareholders, there is no unauthorized use,
disclosure, infringement or misappropriation of any Intellectual Property rights
of Macrotech, any trade secret material to Macrotech, or any Third Party
Intellectual Property Right, by any third party, including any employee or
former employee of Macrotech.
(d) Macrotech is not, and will not as a result of the execution and
delivery of this Agreement or the performance of Macrotech's obligations under
this Agreement be, in breach of any license, sublicense or other agreement
relating to the Intellectual Property or Third Party Intellectual Property
Rights, the breach of which could have a Material Adverse Effect on Macrotech.
(e) All patents, registered trademarks, service marks and copyrights
held by Macrotech are valid and subsisting. Macrotech (i) has not been sued in
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any suit, action or proceeding which involves a claim of infringement of any
patents, trademarks, service marks, copyrights or violation of any trade secret
or other proprietary right of any third party or (ii) has not brought any
action, suit or proceeding for infringement of Intellectual Property or breach
of any license or agreement involving Intellectual Property against any third
party. To the knowledge of Shareholders, the manufacture, marketing, licensing
or sale of the products and services of Macrotech do not infringe any patent,
trademark, service mark, copyright, trade secret or other proprietary right of
any third party.
(f) Macrotech has secured valid written assignments from all
consultants and employees, including from Shareholders, who contributed to the
creation or development of Intellectual Property, and the rights to such
contributions, that Macrotech does not already own by operation of law.
(g) Macrotech has taken all reasonable and appropriate steps to protect
and preserve the confidentiality of all Intellectual Property not otherwise
protected by patents, or patent applications or copyright ("Confidential
Information"). All use, disclosure or appropriation of Confidential Information
owned by Macrotech by or to a third party has been pursuant to the terms of a
written agreement with such third party. All use, disclosure or appropriation of
Confidential Information not owned by Macrotech has been pursuant to the terms
of a written agreement with the owner of such Confidential Information, or is
otherwise lawful.
2.16 MANUFACTURE AND MARKETING RIGHTS. Except as set forth in Schedule 2.16
hereto, Macrotech has not granted rights to manufacture, produce, assemble,
license, market or sell its products to any other person and is not bound by any
agreement that affects Macrotech's exclusive right to develop, manufacture,
assemble, distribute, market or sell its products.
2.17 ENVIRONMENTAL MATTERS. Macrotech is not, in any manner that would have
a material adverse effect on Macrotech (a) in violation of any applicable
statute, law or regulation relating to the environmental or occupational health
and safety or (b) that would require material expenditures in order to comply
with any such existing statute, law or regulation.
2.18 TAXES. Macrotech has timely filed all federal, state, and local tax
returns required by law and has paid all Taxes due and payable. Macrotech has
filed tax returns in all jurisdictions in which it is required to do so. The
provisions for Taxes reflected in the Annual Financial Statements and the
Interim Financial Statements are adequate for any and all Taxes for the periods
ending on December 31, 1991 and June 30, 2000, respectively, and for all prior
periods, whether or not disputed. Macrotech is not now, and never has been, a
member of a consolidated group of corporations for tax reporting purposes. There
are no present audits or disputes as to taxes of any nature payable by Macrotech
or, to the knowledge of the Shareholders, threatened against Macrotech. As used
herein, "Tax" (and, with correlative meaning, "Taxes" and "Taxable") means (i)
any net income, alternative or add-on minimum tax, gross income, gross receipts,
sales, use, ad valorem, transfer, franchise, profits, license, withholding,
payroll, employment, excise, severance, stamp, business and occupations,
occupation, premium, property, environmental or windfall profit tax, custom,
duty, or other tax, governmental fee or other like assessment or charge of any
kind whatsoever, together with any interest or any penalty, addition to tax or
additional amount imposed by any Governmental Entity (a "Tax authority")
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responsible for the imposition of any such tax (domestic or foreign), (ii) any
liability for the payment of any amounts of the type described in clause (i) as
a result of being a member of an affiliated, consolidated, combined or unitary
group for any Taxable period and (iii) any liability for the payment of any
amounts of the type described in clause (i) or (ii) as a result of any express
or implied obligation to indemnify any other person.
2.19 EMPLOYEE BENEFIT PLANS. Macrotech, or by any member of a controlled
group (within the meaning of section 414 of the Internal Revenue Code of 1986,
as amended (the "Code")) of which Macrotech is or was a member, has never
established, maintained or contributed to any employee benefit plans (as such
term is defined in ERISA section 3(3)) or any other retirement, pension, stock
option, stock purchase, stock appreciation right, profit sharing, incentive
compensation, deferred compensation, savings, thrift, vacation pay, severance
pay, cafeteria, dependent care, and other employee benefit plans, programs, or
arrangements (the "Employee Plans"). Neither Macrotech nor any member of a
controlled group (within the meaning of Code section 414) of which Macrotech is
or was a member has ever maintained, contributed to, or been obligated to
contribute to any plan, including a multiemployer plan, that is subject to Title
IV of ERISA or the minimum funding requirements of Code section 412. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereunder will not result in any "excess parachute
payments" within the meaning of Code section 280G.
2.20 EMPLOYEE MATTERS. Schedule 2.20 hereto lists all employees of
Macrotech and the remuneration and benefits to which such employees are
entitled. There are no pending claims against Macrotech under any workers
compensation plan or policy or for long term disability. Macrotech does not have
any obligations under COBRA with respect to any former employees or qualifying
beneficiaries thereunder. Each employee and officer of Macrotech has executed an
Invention Assignment Agreement, substantially in the form presented to Simtek in
the due diligence materials delivered to Simtek's counsel.
2.21 INTERESTED PARTY TRANSACTIONS. Except as disclosed in Schedule 2.21
hereto, Macrotech is not indebted to any shareholder, director, officer,
employee or agent of Macrotech (except for amounts due as normal salaries and
bonuses and in reimbursement of ordinary expenses).
2.22 INSURANCE. Macrotech has policies of insurance and bonds of the type
and in amounts customarily carried by persons conducting businesses or owning
assets similar to those of Macrotech. Schedule 2.22 hereto sets forth a true and
complete listing of all such policies. There is no material claim pending under
any of such policies or bond as to which Macrotech has received a denial, or, to
the knowledge of the Shareholders, which coverage has been questioned, denied or
disputed by the underwriters of such policies or bonds. All premiums due and
payable under all such policies and bonds have been paid and Macrotech is
otherwise in compliance in all material respects with the terms of such policies
and bonds. The Shareholders have no knowledge of any threatened termination of,
or material premium increase with respect to, any of such policies.
2.23 COMPLIANCE WITH LAWS. Macrotech has complied with, is not in violation
of, and has not received any notices of violation with respect to, any federal,
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state, local or foreign statute, law or regulation with respect to the conduct
of its business, or the ownership or operation of its business, except for such
violations or failures to comply as could not be reasonably expected to have a
Material Adverse Effect on Macrotech.
2.24 MINUTES BOOKS. The minute books of Macrotech made available to Simtek
contain true and complete summaries of all meetings of directors and
shareholders or actions by written consent since the time of incorporation of
Macrotech, and reflect all transactions referred to in such minutes accurately
in all material respects.
2.25 PUBLIC FILINGS. Shareholders have received and reviewed copies of
Simtek's annual report on Form 10-KSB for the year ended December 31, 1999 and
Simtek has provided Macrotech with a copy of Simtek's annual report on Form
10-KSB for the year ended December 31, 1999, quarterly report on Form 10-QSB for
the quarter ended March 31, 2000, and filings on Form 8-K filed April 25, 2000,
May 1, 2000, May 11, 2000 and June 29, 2000, in each case including all
amendments (collectively, the "Exchange Act Documents"). Simtek does not have
reason to believe that any of the Exchange Act Documents contains any untrue
statement of material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
2.26 DISCLOSURE. None of the representations or warranties made by the
Shareholders herein or in the attached Schedule or in any other agreement,
written statements or in any certificate furnished by the Shareholders pursuant
to or in connection with this Agreement, contain or will contain at the Closing
Date any untrue statement of a material fact, or omit or will omit at the
Closing Date to state any material fact necessary in order to make the
statements contained herein or therein, in the light of the circumstances under
which made, not misleading.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SIMTEK
Simtek represents and warrants to the Shareholders as follows:
3.1 ORGANIZATION. Simtek is a corporation duly organized, validly existing
and in good standing under the laws of the State of Colorado.
3.2 DUE AUTHORIZATION. Simtek has the full corporate power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby. This Agreement has been duly executed and delivered by Simtek and
constitutes the valid and binding obligation of Simtek enforceable against
Simtek in accordance with its terms. The execution and delivery of this
Agreement do not, and the consummation of the transactions contemplated hereby
will not, (a) violate or conflict with any permit, order, license, decree,
judgment, statute, law, ordinance, rule or regulation applicable to Simtek or
(b) result in any breach or violation of, or constitute a default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of, or result in the creation of any
Lien on any of the properties or assets of Simtek pursuant to, or require the
consent of any party to any mortgage, indenture, lease, contract or other
agreement or instrument, bond, note, concession or franchise applicable to
Simtek or any of its properties or assets, except, in the case of this clause
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(b) only, where such conflict, violation, default, termination, cancellation or
acceleration would not have and could not reasonably be expected to prevent the
consummation of the transactions contemplated hereby. No consent, approval,
order or authorization of, or registration, declaration or filing with, any
Governmental Entity is required by or with respect to Simtek in connection with
the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby.
3.3 DULY AUTHORIZED, FULLY PAID AND NON-ASSESSABLE STOCK. The issuance of
the Simtek Stock has been duly authorized, and upon issuance to Shareholders
pursuant to the terms hereof, will be validly issued, fully paid and
nonassessable and are and will be free and clear of any lien or encumbrances
except as set forth in this Agreement and are not and will not be subject to
preemptive rights or rights of first refusal.
3.4 BROKERS' AND FINDERS' FEES. Simtek has not incurred, and will not
incur, directly or indirectly, any liability for brokerage or finders' fees or
agents' commissions or investment bankers' fees or any similar charges in
connection with this Agreement or any transaction contemplated hereby.
3.5 NO CONFLICTS. The execution, delivery and performance of this Agreement
and the agreements to be executed and delivered at the Closing, and the
consummation of the transactions contemplated hereby and thereby do not and will
not (a) violate or conflict with any provision of each of Simtek's Articles of
Incorporation or Bylaws, (b) violate or conflict with any provision of, or be an
event that is (or with the passage of time will result in) a default or
violation of, or result in the modification, cancellation or acceleration of
(whether after the giving of notice or lapse of time or both) any obligation
under, or result in the imposition or creation of any encumbrances upon any of
the assets of Simtek pursuant to, any material contract, mortgage, lien, lease,
agreement or instrument to which Simtek is a party or by which each of Simtek is
bound, (c) violate or conflict with any legal requirement applicable to each of
Simtek including but not limited to the legal requirements of the National
Association of Securities Dealers, or any of its properties or assets or any
other material restriction of any kind or character to which it is subject, or
(d) require any authorization, consent, order, permit or approval of, or notice
to, or filing, registration or qualification with, any Government Authority.
ARTICLE IV
DELIVERIES AT CLOSING
4.1 SHAREHOLDERS' DELIVERIES. At the Closing, the Shareholders shall
deliver to Simtek:
(a) the certificates representing shares of Stock in negotiable form,
duly endorsed in blank, or with separate notarized stock transfer powers
attached thereto and signed in blank;
(b) a legal opinion from Myers, Hawley, Morley, Myers & McDonnell,
legal counsel to the Shareholders, substantially in form attached as Exhibit
4.1(b);
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(c) evidence, satisfactory to Simtek, of all consents or approvals of
those persons whose consent or approval is required in connection with the
transactions contemplated hereby under any material contract of Macrotech or
otherwise;
(d) letters of resignation, effective as of the Closing Date, executed
and tendered by each of the then incumbent directors and officers of Macrotech;
and
(e) an employment agreement, duly executed by J. Johal, substantially
in the form of the attached Exhibit 4.1(e).
4.2 SIMTEK DELIVERIES. At the Closing, Simtek shall deliver to the
Shareholders:
(a) stock certificates representing the Simtek Stock, duly issued to
Shareholders; and
(b) a legal opinion from Holme Roberts & Owen, counsel to Simtek,
substantially in the form attached as Exhibit 4.2(b); and
(c) an employment agreement, duly executed by Simtek, substantially in
the form of the attached Exhibit 4.1(e).
ARTICLE V
ESCROW; REGISTRATION
5.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties in Article II of the Shareholders shall survive the Closing and
continue in full force and effect for one year after the date hereof, except for
the representation and warranty of Section 2.2 which shall survive indefinitely.
The representations and warranties of Simtek shall survive the Closing for a
period of one year after the date hereof, except for the representation and
warranty of Section 3.3 which shall survive indefinitely.
5.2 INDEMNIFICATION AND ESCROW. On the Closing Date, each of the
Shareholders shall deliver to Simtek certificates representing 50,000 shares
(the "Escrow Shares") of Simtek Stock issued to such Shareholder in negotiable
form, duly endorsed in blank, and with separate notarized stock transfer powers
attached thereto and signed in blank. Simtek shall hold the Escrow Shares in
escrow for one year following the date hereof. If Simtek's board of directors in
good faith determines that either of the Shareholders breached any of his
representations or warranties set forth herein, Simtek shall have the right (the
"Escrow Right") unilaterally to offset any cost, expense or damage
(collectively, the "Damages") incurred or suffered by Simtek or the Company or
both arising from or relating to such breach. Simtek shall exercise the Escrow
Right by, at the conclusion of such one year period, (i) transferring legal
title to the Escrow Shares, or any portion thereof, to Simtek (which shares
shall then be held as treasury stock), (ii) canceling all, or a portion of, the
Escrow Shares, (iii) transferring the Escrow Shares, or any portion thereof, to
a third party, or (iv) taking any combination of the actions set forth in
Section 5.2(i) through (iii). Simtek shall only exercise the Escrow Right with
respect to such portion of the Escrow Shares that Simtek's board of directors,
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in good faith, determines to equal the Damages suffered by Simtek or the Company
or both. Absent fraud by either of the Shareholders, Simtek's Escrow Right shall
be Simtek's sole recourse against the Shareholders for any breach by the
Shareholders of the Shareholders' representations or warranties in this
Agreement.
5.3 INDEMNIFICATION BY SIMTEK. Simtek covenants and agrees that it will
indemnify, defend, protect and hold harmless Shareholders at all times from and
after the date of this Agreement against all Damages based upon, resulting from
or arising out of any inaccuracy or breach of any representation or warranty of
Simtek contained in Article III of this Agreement.
5.4 INDEMNIFICATION PROCEDURES. Promptly after receipt by any person
entitled to indemnification (an "indemnified party") of notice of the
commencement of any action, suit or proceeding by a person not a party to this
Agreement in respect of which the indemnified party will seek indemnification
hereunder (a "Third Party Action"), the indemnified party shall notify the
person that is obligated to provide such indemnification (the "indemnifying
party") thereof in writing, but any failure to so notify the indemnifying party
shall not relieve it from any liability that it may have to the indemnified
party, except to the extent that the indemnifying party is prejudiced by the
failure to give such notice. The indemnifying party shall be entitled to
participate in the defense of such Third Party Action and to assume control of
such defense (including settlement of such Third Party Action) with counsel
reasonably satisfactory to such indemnified party.
5.5 REGISTRATION. Simtek shall use its best efforts to register the Simtek
Stock under the Securities Act on a Form SB-2 for resale by Shareholders of
500,000 shares of Simtek Stock issued to Shareholders on or before November 30,
2000 on the terms and conditions of the attached Exhibit 5.5.
ARTICLE VI
GENERAL PROVISIONS
6.1 NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or by commercial
delivery service, or mailed by registered or certified mail, return receipt
requested, or sent via facsimile, with confirmation of receipt, to the parties
at the following address or at such other address for a party as shall be
specified by notice hereunder:
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(a) if to Simtek, to:
Simtek Corporation
1465 Kelly Johnson Blvd., Suite 301
Colorado Springs, CO 80920
Attention: Douglas Mitchell
Facsimile No.: (719) 531-9481
with a copy to:
Holme Roberts & Owen LLP
1700 Lincoln, Suite 4100
Denver, Colorado 80203
Attention: Garth B. Jensen, Esq.
Facsimile No.: (303) 866-0200
(b) if to the Shareholders, to:
Jaskarn Johal
610 Park View Drive Ste. 206
Santa Clara, CA 95054
Kashmira S. Johal
5560 Arezzo Drive
San Jose, CA 95138
with a copy to:
Myers, Hawley, Morley, Myers & McDonnell
166 Main Street
P.O. Box 280
Los Altos, CA 94023-0280
Attn: John P. McDonnell
Facsimile No.: (650) 949-3581
6.2 INTERPRETATION. When a reference is made in this Agreement to Exhibits,
Articles or Sections, such reference shall be to an Exhibit, Article or Section
to this Agreement unless otherwise indicated. The words "include," "includes"
and "including" when used herein shall be deemed in each case to be followed by
the words "without limitation." The phrase "made available" in this Agreement
shall mean that the information referred to has been made available if requested
by the party hereto to whom such information is to be made available. The table
of contents and Article and Section headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. In this Agreement, any reference to any event,
change, condition or effect being "material" with respect to any entity or group
of entities means any material event, change, condition or effect related to the
condition (financial or otherwise), properties, assets (including intangible
assets), liabilities, business, operations or results of operations of such
entity or group of entities. In this Agreement, any reference to a "Material
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Adverse Effect" with respect to any entity or group of entities means any event,
change or effect that is materially adverse to the condition (financial or
otherwise), properties, assets, liabilities, business, operations or results of
operations of such entity and its subsidiaries, taken as a whole. In this
Agreement, any reference to a party's "knowledge" means such party's actual
knowledge after due and diligent inquiry of officers, directors and other
employees of such party reasonably believed to have knowledge of such matters.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms.
6.3 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties hereto and delivered to the other parties hereto, it being
understood that all parties hereto need not sign the same counterpart.
6.4 ENTIRE AGREEMENT; NONASSIGNABILITY; PARTIES IN INTEREST. This Agreement
and the documents and instruments and other agreements specifically referred to
herein or delivered pursuant hereto, including the Exhibits and the attached
Schedule (a) constitute the entire agreement among the parties hereto with
respect to the subject matter hereof and supersede all prior agreements and
understandings, both written and oral, among the parties hereto with respect to
the subject matter hereof; (b) are not intended to confer upon any other person
any rights or remedies hereunder; and (c) shall not be assigned by operation of
law or otherwise except as otherwise specifically provided.
6.5 SEVERABILITY. In the event that any provision of this Agreement, or the
application thereof, becomes or is declared by a court of competent jurisdiction
to be illegal, void or unenforceable, the remainder of this Agreement will
continue in full force and effect and the application of such provision to other
persons or circumstances will be interpreted so as reasonably to effect the
intent of the parties hereto. The parties hereto further agree to replace such
void or unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the economic, business and
other purposes of such void or unenforceable provision.
6.6 REMEDIES CUMULATIVE; NO WAIVER. Except as otherwise provided herein,
any and all remedies herein expressly conferred upon a party will be deemed
cumulative with and not exclusive of any other remedy conferred hereby, or by
law or equity upon such party, and the exercise by a party of any one remedy
will not preclude the exercise of any other remedy. No failure or delay on the
part of any party hereto in the exercise of any right hereunder shall impair
such right or be construed to be a waiver of, or acquiescence in, any breach of
any representation, warranty or agreement herein, nor shall any single or
partial exercise of any such right preclude other or further exercise thereof or
of any other right.
6.7 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Colorado (without regard to the
principles of conflicts of law thereof).
6.8 FURTHER ASSURANCES. In case at any time after the Closing any further
action is necessary or desirable to carry out the purposes of this Agreement,
the proper officers and/or directors of Simtek and Macrotech and the
Shareholders shall take all such necessary action.
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6.9 AMENDMENT. The parties hereto may cause this Agreement to be amended at
any time by execution of an instrument in writing signed by Simtek and the
Shareholders.
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IN WITNESS WHEREOF, the parties hereto have caused this Share Exchange
Agreement to be executed and delivered by their respective officers thereunto
duly authorized, all as of the date first written above.
Simtek:
------
SIMTEK CORPORATION, a Colorado corporation
By: /s/ Douglas Mitchell
--------------------------------------
Name: Douglas Mitchell
Title: President
Shareholders:
------------
JASKARN JOHAL
/s/ Jaskarn Johal
-------------------------------------------
Jaskarn Johal
KASHMIRA S. JOHAL
/s/ Kashmira S. Johal
-------------------------------------------
Kashmira S. Johal
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Exhibit 4.1(b)
Form of Myers, Hawley, Morley, Myers & McDonnell Legal Opinion
<PAGE>
Exhibit 4.1(e)
Form of Employment Agreement
<PAGE>
Exhibit 4.2(b)
Form of Holme Roberts & Owen LLP Legal Opinion
<PAGE>
Exhibit 5.5
Registration Rights Schedule
----------------------------
(to Share Exchange Agreement)
