<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended March 31, 1995 or
[ ] Transition report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the transition period from ___ to ___
Commission file number 0-17139
GENUS, INC.
(Exact name of registrant as specified in its charter)
California 94-279080
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1139 Karlstad Drive, Sunnyvale, California 94089
(Address of principal executive offices) (Zip code)
(408) 747-7120
----------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
-------------------------------------------------------------
(Former name, former address and former fiscal year,if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes ___X____ No ________
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
Common shares outstanding at May 10, 1995: 15,674,329
<PAGE>
GENUS, INC.
Index
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION
Page No.
<C> <S> <C>
Item 1. Financial Statements
Consolidated Statements of Operations -
Three months ended March 31, 1995
and March 31, 1994 3
Consolidated Balance Sheets -
March 31, 1995 and December 31, 1994 4
Consolidated Statements of Cash Flows -
Three months ended March 31, 1995
and March 31, 1994 5
Notes to Consolidated Financial Statements 6-8
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations 9-10
<CAPTION>
PART II. OTHER INFORMATION
<C> <S> <C>
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 12
Index to Exhibits 13
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
GENUS, INC.
Consolidated Statements of Operations (Unaudited)
(Amounts in thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
<S> <C> <C>
Net sales $22,526 $13,773
Costs and expenses:
Cost of goods sold 13,306 8,456
Research and development 2,976 1,999
Selling, general & administrative 4,218 2,750
------- -------
Income from operations 2,026 568
Other income, net 58 110
------- -------
Income before provision for income
taxes 2,084 678
Provision for income taxes 146 26
------- -------
Net income $ 1,938 $ 652
------- -------
------- -------
Net income per share $ 0.13 $ 0.05
------- -------
------- -------
Shares used in per share calculation 14,579 12,942
------- -------
------- -------
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
GENUS, INC.
Consolidated Balance Sheets (Unaudited)
(Amounts in thousands, except share data)
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 17,531 $ 10,188
Accounts receivable
(net of allowance for doubtful
accounts of $250 in 1995 and
1994) 21,953 15,169
Inventories, net 17,599 14,677
Other current assets 884 655
-------- --------
Total current assets 57,967 40,689
Property and equipment, net 11,696 11,492
Other assets, net 2,902 2,816
-------- --------
$ 72,565 $ 54,997
-------- --------
-------- --------
LIABILITIES
Current liabilities:
Short-term bank borrowings - 3,800
Accounts payable 8,633 5,858
Accrued expenses 6,868 6,625
Current portion of long-term debt 1,091 1,205
-------- --------
Total current liabilities 16,592 17,488
-------- --------
Long-term debt, less current portion 662 523
-------- --------
SHAREHOLDERS' EQUITY
Preferred stock, no par value:
Authorized, 2,000,000 shares;
Issued and outstanding, none
Common stock, no par value:
Authorized, 20,000,000 shares;
Issued and outstanding, 15,407,095
shares (1995)and 12,813,028 shares
(1994) 92,977 76,590
Accumulated deficit (37,666) (39,604)
-------- --------
Total shareholders' equity 55,311 36,986
-------- --------
$ 72,565 $ 54,997
-------- --------
-------- --------
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
GENUS, INC
Consolidated Statements of Cash Flows (Unaudited)
(Amounts in thousands)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,938 $ 652
Adjustments to reconcile to net cash
from operating activities:
Depreciation and amortization 934 643
Changes in assets and liabilities:
Accounts receivable (6,784) 3,043
Inventories (2,922) 497
Other current assets (229) (89)
Accounts payable 2,775 1,407
Accrued expenses 243 (2,483)
Other, net (219) (116)
------- -------
Net cash provided by (used in) operating
activities (4,264) 3,554
------- -------
Cash flows from investing activities:
Acquisition of property and equipment (640) (114)
------- -------
Net cash used in investing activities (640) (114)
------- -------
Cash flows from financing activities:
Net proceeds from issuance of common stock 16,387 123
Payment of short-term bank borrowings (3,800) (2,100)
Payments of long-term debt (340) (225)
------- -------
Net cash provided by (used in) financing
activities 12,247 (2,202)
------- -------
Increase in cash and cash equivalents 7,343 1,238
Cash and cash equivalents, beginning of period 10,188 10,423
------- -------
Cash and cash equivalents, end of period $17,531 $11,661
------- -------
------- -------
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
GENUS, INC.
Notes to Consolidated Financial Statements (Unaudited)
March 31, 1995
(Amounts in thousands)
Basis of Presentation
The accompanying consolidated financial statements have been prepared in
accordance with SEC requirements for interim financial statements. These
financial statements should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's 1994 Annual
Report to Shareholders which is incorporated by reference into the Company's
Annual Report on Form 10-K for the year ended December 31, 1994.
The information furnished reflects all adjustments (consisting only of normal
recurring adjustments) which are, in the opinion of management, necessary for
the fair statement of the consolidated financial position, results of
operations and cash flows for the interim periods. The results of operations
for the periods presented are not necessarily indicative of results to be
expected for the full year.
Net Income Per Share
Net income per share is computed by dividing net income by the weighted
average number of common and common equivalent shares of common stock
outstanding during each period.
Statement of Cash Flows Information (Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
1995 1994
<S> <C> <C>
Supplemental Cash Flow Information:
Cash paid during the period for:
Interest $ 59 $ 46
Income taxes $ 25 $ 48
Non cash investing activities:
Purchase of property and equipment
under long-term debt obligations $365 $114
</TABLE>
Line of Credit
In May 1995, the Company renewed its working capital line of credit agreement
with a bank that provides for maximum borrowings of $10 million, limited to
80% of eligible accounts receivable, which expires in May 1996. Borrowings
under the line of credit, which are secured by substantially all of the
assets of the
6
<PAGE>
GENUS, INC.
Notes to Consolidated Financial Statements (Unaudited)(Continued)
(Amounts in thousands)
Company, bear interest at the bank's prime rate plus 0.75%. The line of
credit agreement requires the Company to comply with certain financial
covenants and restricts the payment of dividends. At March 31, 1995, the
Company had no such borrowings outstanding under the line of credit.
The Company has a Term Loan Agreement with the same bank which provides $3
million to fund leasehold improvements to its current facility. At March 31,
1995, $0.7 million was outstanding under the Term Loan Agreement. The Term
Loan Agreement requires the Company to comply with the same financial
covenants and restrictions regarding the payment of dividends under the
working capital line of credit agreement.
Inventories
Inventories comprise the following:
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
<S> <C> <C>
Raw materials and spare parts $ 9,132 $ 8,156
Work in process 8,114 6,118
Finished goods 353 403
------- -------
$17,599 $14,677
------- -------
------- -------
</TABLE>
Property and Equipment
Property and equipment are stated at cost and comprise the following:
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
<S> <C> <C>
Building and improvements $ 248 $ 248
Demonstration equipment 11,912 11,909
Equipment 8,948 8,460
Furniture and fixtures 1,955 1,952
Leasehold improvements 5,712 5,653
------- -------
28,775 28,222
Less accumulated depreciation
and amortization (19,063) (18,262)
------- -------
9,712 9,960
Construction in process 1,984 1,532
------- -------
$11,696 $11,492
------- -------
------- -------
</TABLE>
7
<PAGE>
GENUS, INC.
Notes to Consolidated Financial Statements (Unaudited)(continued)
(Amounts in thousands)
Accrued Expenses
Accrued expenses comprise the following:
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
<S> <C> <C>
System installation and warranty $2,892 $2,394
Accrued payroll and related items 1,258 966
Accrued commissions and incentives 1,177 1,527
Customer advances and deferred revenue 416 502
Other 1,125 1,236
------ ------
$6,868 $6,625
------ ------
------ ------
</TABLE>
Sale of Common Stock
On February 17, 1995, the Company sold 2,539,018 shares of common stock
through a private placement offering, which generated gross proceeds of
approximately $17.5 million.
8
<PAGE>
GENUS, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
RESULTS OF OPERATIONS
Net sales for the quarter ended March 31, 1995 were $22.5 million compared
with net sales of $13.8 million in the same period of 1994, a 63 percent
increase. The increase was primarily due to the introduction of the tungsten
chemical vapor deposition (CVD) 7000 product line with higher average selling
prices (ASP), higher unit sales of ion implantation systems and greater
spares revenue. The Company's net sales results continue to benefit from
strong market conditions in Korea.
Gross margin for the quarter ended March 31, 1995 was 41 percent compared to
39 percent for the same period in 1994. The improvement in gross margin was
primarily due to higher ASP, higher unit sales volumes, greater absorption of
manufacturing costs, and other gross margin improvement programs. The
Company's gross margins have historically been affected by variations in ASP,
changes in the mix of product sales, unit shipments levels, the level of
foreign sales, and competitive pricing pressures.
During the first quarter of 1995, Research and Development (R&D) expenses as
a percentage of net sales, were 13 percent compared to 15 percent in the same
period of 1994. The change was primarily due to higher net sales volumes.
On an absolute dollar basis, R&D expenses during the first quarter of 1995
increased $1.0 million when compared with the same period in 1994. The
increase was primarily due to higher development material cost and
depreciation expense for new product development. The Company continually
evaluates its R&D investment in view of evolving competitive and market
conditions.
Selling, general and administrative expenses (S,G&A) were 19 percent of net
sales during the first quarter of 1995 compared to 20 percent in the same
period of 1994. The change was primarily due to higher sales volume. On an
absolute dollar basis, S,G&A increased $1.5 million when compared with the
same period in 1994. The change was primarily due to increased headcount and
related payroll costs, higher sales commissions and increased depreciation
expense.
During the first quarter of 1995, the Company earned the same amount in other
income when compared with the same period in 1994. The effective tax rate
for the first quarter of 1995 was 7 percent compared with the effective tax
rate of 4 percent during the same period in 1994.
In recent quarters, the Company has recorded positive financial performance
and consistently solid order rates. These results have been primarily due to
strong market conditions for the Company's products in Korea, as a result of
increased investments in DRAM manufacturing facilities in this region. The
Company anticipates that these positive trends will continue in the
near-term. However, due to the continued competitive market
9
<PAGE>
environment for the Company's products, the cyclical nature of the
semiconductor equipment market and the Company's reliance on a limited number
of customers for a significant portion of its orders, the Company remains
cautiously optimistic about the future prospects for its business. The
Company continues to make strategic investments for new product development
and manufacturing improvements with a view to improve future performance by
enhancing product offerings; however, such investment may adversely affect
short-term operating performance. The Company is also continuing its efforts
to implement productivity improvements for future operating performance. The
Company believes that the future economic environment could continue to
lengthen the order and sales cycles for its products, causing it to continue
to simultaneously book and ship some orders during the same quarter.
LIQUIDITY AND CAPITAL RESOURCES
During the first quarter ended March 31,
1995, the Company's cash and cash equivalents increased $7.3 million
principally due to the net proceeds from the issuance of common stock of
$16.4 million, offset by cash used in operating activities of $4.3 million,
payment of short-term bank borrowings of $3.8 million and the purchase of
property and equipment of $0.6 million. The negative change in cash from
operating activities primarily resulted from an increase of $6.8 million in
accounts receivable due to higher net sales, and the inability to collect
shipments made late in the quarter, and an increase in inventories of $2.9
million as a result of inventory purchases received late in the quarter to
support shipments early in the second quarter of 1995. The reduction in cash
from operating activities was offset by the increase in accounts payable of
$2.8 million as a result of higher inventory purchases and the cash
management practices of the Company; depreciation and amortization of $0.9
million and net income of $1.9 million.
The Company's primary source of funds at March 31, 1995 consisted of $17.5
million in cash and cash equivalents, and funds available under a $10.0
million revolving line of credit. The line of credit is secured by
substantially all of the assets of the Company and expires in May 1996. At
March 31, 1995, the Company had no borrowings outstanding under the line of
credit.
Capital expenditures during the first quarter of 1995 were $1.0 million and
related primarily to acquisition of machinery and equipment for the Company's
R&D and Applications Laboratories. The Company anticipates that it will
continue to make capital expenditures during the remainder of 1995. These
expenditures, primarily for the R&D and Applications Laboratories are
anticipated to be funded through existing working capital or lease financing.
On February 17, 1995, the Company sold 2,539,018 shares of Common Stock
through a private placement offering, which generated gross proceeds of
approximately $17.5 million.
The Company believes that cash generated from operations, if any, proceeds
from the private placement offering and existing credit facilities will be
sufficient to satisfy its cash needs for the foreseeable future.
10
<PAGE>
GENUS, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 10.1 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and ING
Sivllupo Gestioni SpA
Exhibit 10.2 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and TR
Technology Investment Trust, PLC
Exhibit 10.3 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and Conseco
Capital Management
Exhibit 10.4 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and Oberweis
Emerging Growth Fund
Exhibit 10.5 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and San
Paolo Fundi SpA
Exhibit 10.6 Common Stock Purchase Agreement dated as of
February 8, 1995 between Registrant and HTR
Global Technology Fund
Exhibit 10.7 Common Stock Purchase Agreement dated as of
February 10, 1995 between Registrant and Bachow
Investment Partners III,L.P., Paul S. Bachow Co-
Investment Fund, L.P. and Paul S. Bachow
Exhibit 11.1 - Computation of Net Income Per Share
(b) Report on Form 8-K
No report on Form 8-K was filed during the quarter ended March 31, 1995.
11
<PAGE>
GENUS, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: May 10, 1995 GENUS, INC.
William W.R. Elder
_____________________
William W.R. Elder
Chairman and Chief Executive Officer
Todd S. Myhre
_____________________
Todd S. Myhre,
President and
Chief Operating Officer
Acting Chief Financial
Officer
12
<PAGE>
GENUS, INC.
Index to Exhibits
<TABLE>
<CAPTION>
Exhibit Description Page
<C> <S> <C>
Exhibit 10.1 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
ING Sivllupo Gestioni SpA
Exhibit 10.2 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
TR Technology Investment Trust, PLC
Exhibit 10.3 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
Conseco Capital Management
Exhibit 10.4 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
Oberweis Emerging Growth Fund
Exhibit 10.5 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
San Paolo Fundi SpA
Exhibit 10.6 Common Stock Purchase Agreement dated as
of February 8, 1995 between Registrant and
HTR Global Technology Fund
Exhibit 10.7 Common Stock Purchase Agreement dated as
of February 10, 1995 between Registrant and
Bachow Investment Partners III,L.P.,
Paul S. Bachow Co-Investment Fund, L.P. and
Paul S. Bachow
Exhibit 11.1 Computation of Net Income per Share
</TABLE>
13
<PAGE>
EXHIBIT 10.1
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
ING SVILLUPO GESTIONI S.P.A.
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
Statement. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (A) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (A) the third anniversary of the
Closing Date or (B) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with the
covenants and agreements contained in Section 7.3 hereof, or (iii) any untrue
statement in any prospectus that is corrected in any subsequent prospectus that
was delivered to the Purchaser prior to the pertinent sale or sales by the
Purchaser, and each Purchaser, severally and not jointly, will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Purchasers' obligations in this subsection (d) to contribute are several in
proportion to their respective sales of Shares to which such loss relates, and
not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ TODD S. MYHRE
---------------------
Its President & Chief Operating Officer
-----------------------------------
-14-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): ING Sviluppo Gestioni S.P.A.
Name of Individual representing
Purchaser: DR. Sandro Pierri
Title of Individual representing
Purchaser: Senior Fund Manager
Signature by:
Individual representing
Purchaser: /S/ Sandro Pierri
Address: VIA TORTONA 33 20144
MILANO, ITALIA
Telephone: 02.47780.372
Facsimile: 02.47780.428
Telex: 331045
AGGREGATE PURCHASE PRICE: $3,000,000.00
NAME IN WHICH SHARES ARE
TO BE REGISTERED: ING Sviluppo America: USD 1,000,000.00
ING Sviluppo Azionario: USD 1,450,000.00
ING Sviluppo Iniziativa: USD 330,000.00
ING Sviluppo Portfolio: USD 220,000.00
USD 3,000,000.00
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-16-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
-----------------------------
Name of Individual
representing
Purchaser (if an
Institution):
-----------------------------
Title of Individual
representing
Purchaser (if an
Institution):
-----------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
-----------------------------
-16-
<PAGE>
EXHIBIT 10.2
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
TR TECHNOLOGY INVESTMENT TRUST, PLC
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (a) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (A) the third anniversary of the
Closing Date or (B) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with the
covenants and agreements contained in Section 7.3 hereof, or (iii) any untrue
statement in any prospectus that is corrected in any subsequent prospectus that
was delivered to the Purchaser prior to the pertinent sale or sales by the
Purchaser, and each Purchaser, severally and not jointly, will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Purchasers' obligations in this subsection (d) to contribute are several in
proportion to their respective sales of Shares to which such loss relates, and
not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ Todd S. Myhre
------------------------------------
Its President & Chief Operating Officer
-----------------------------------
-14-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): TR Technology Investment
Trust, PLC
Name of Individual representing
Purchaser: Ian Barnard
Title of Individual representing
Purchaser: Authorized Signatory
Signature by:
Individual representing
Purchaser: /s/ Ian Barnard
-------------------------------
Address: 3 Finsbury Avenue
-------------------------------
London, UK EC2M 2PA
-------------------------------
Telephone: 071-410-4593
-------------------------------
Facsimile: 071-410-4066
-------------------------------
Telex: 884616
-------------------------------
AGGREGATE PURCHASE PRICE: $2,225,000.00
-------------------------------
NAME IN WHICH SHARES ARE
TO BE REGISTERED: Sigler & Co.
-------------------------------
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-15-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
---------------------------
Name of Individual
representing
Purchaser (if an
Institution):
---------------------------
Title of Individual
representing
Purchaser (if an
Institution):
---------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
---------------------------
-16-
<PAGE>
EXHIBIT 10.3
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
CONSECO CAPITAL MANAGEMENT
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (A) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (A) the third anniversary of the
Closing Date or (B) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with the
covenants and agreements contained in Section 7.3 hereof, or (iii) any untrue
statement in any prospectus that is corrected in any subsequent prospectus that
was delivered to the Purchaser prior to the pertinent sale or sales by the
Purchaser, and each Purchaser, severally and not jointly, will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Purchasers' obligations in this subsection (d) to contribute are several in
proportion to their respective sales of Shares to which such loss relates, and
not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ Todd S. Myhre
------------------------------------
Its President & Chief Operating Officer
-----------------------------------
-14-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): CONSECO CAPITAL MANAGEMENT
AS INVESTMENT ADVISER
Name of Individual representing
Purchaser: TOM MEYERS
Title of Individual representing
Purchaser: DIRECTOR OF RESEARCH, SVP
Signature by:
Individual representing
Purchaser: /s/ Tom Meyers
-------------------------------
Address: 11825 PENNSYLVANIA STREET 820
CARMEL, IN 46032
Telephone: 317-817-6247
Facsimile: 317-817-2763
Telex:
-------------------------------
AGGREGATE PURCHASE PRICE: $1,500,005.07
NAME IN WHICH SHARES ARE
TO BE REGISTERED: SALKELD & CO.
14 Wall Street
4th Floor
Window #62
c/o Brad Smith
New York, NY 10005
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-15-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
-----------------------------
Name of Individual
representing
Purchaser (if an
Institution):
-----------------------------
Title of Individual
representing
Purchaser (if an
Institution):
-----------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
-----------------------------
-16-
<PAGE>
EXHIBIT 10.4
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
OBERWEIS EMERGING GROWTH FUND
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (A) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (A) the third anniversary of the
Closing Date or (B) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with the
covenants and agreements contained in Section 7.3 hereof, or (iii) any untrue
statement in any prospectus that is corrected in any subsequent prospectus that
was delivered to the Purchaser prior to the pertinent sale or sales by the
Purchaser, and each Purchaser, severally and not jointly, will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Purchasers' obligations in this subsection (d) to contribute are several in
proportion to their respective sales of Shares to which such loss relates, and
not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ Todd S. Myhre
------------------------------------
Its President & Chief Operating Officer
-----------------------------------
-14-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): OBERWEIS EMERGING GROWTH FUND
Name of Individual representing
Purchaser: JAMES D. OBERWEIS
Title of Individual representing
Purchaser: PRESIDENT
Signature by:
Individual representing
Purchaser: /s/ James D. Oberweis
------------------------------
Address: ONE CONSTITUTION DR.
AURORA, IL 60506
Telephone: 800-323-6166
Facsimile: 708-896-5282
Telex:
AGGREGATE PURCHASE PRICE: $1,000,000.00
NAME IN WHICH SHARES ARE
TO BE REGISTERED: UNITED MISSOURI TRUST CO. OF N.Y.
Nominee Name -IF
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-15-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
--------------------------------
Name of Individual
representing
Purchaser (if an
Institution):
--------------------------------
Title of Individual
representing
Purchaser (if an
Institution):
--------------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
--------------------------------
-16-
<PAGE>
EXHIBIT 10.5
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
SANPAOLO FONDI S.P.A.
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (A) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (A) the third anniversary of the
Closing Date or (B) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with
the covenants and agreements contained in Section 7.3 hereof, or (iii) any
untrue statement in any prospectus that is corrected in any subsequent
prospectus that was delivered to the Purchaser prior to the pertinent sale or
sales by the Purchaser, and each Purchaser, severally and not jointly, will,
as incurred, reimburse the Company for any legal or other expenses reasonably
incurred in investigating, defending or preparing to defend any such action,
proceeding or claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying
person or any affiliate or associate thereof, the indemnified person shall be
entitled to retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not
guilty of such fraudulent misrepresentation. The Purchasers' obligations in
this subsection (d) to contribute are several in proportion to their respective
sales of Shares to which such loss relates, and not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ Todd S. Myhre
-------------------------------------
Its President & Chief Operating Officer
------------------------------------
-11-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): San Paolo Fondi S.p.A.
Name of Individual representing
Purchaser: Antonio Midolo
Title of Individual representing
Purchaser: US Equity Fund Manager
Signature by:
Individual representing
Purchaser: /s/ Antonio Midolo
------------------------------
Address: Turin - Italy
Stati Uniti 17
------------------------------
Telephone: 011-55692316
------------------------------
Facsimile: 011-55692502
------------------------------
Telex: 224347
------------------------------
AGGREGATE PURCHASE PRICE: $1,000,000.00
------------------------------
NAME IN WHICH SHARES ARE
TO BE REGISTERED: ( EUROJUNIOR: $ 400,000.00
------------------------------------------
(
Mutual Fund Acccounts ( SPH INDUSTRIAL: $ 400,000.00
------------------------------------------
( SPH INTERNATIONAL: $ 200,000.00
------------------------------------------
$ 1,000,000.00
------------------------------------------
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-12-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
---------------------------------
Name of Individual
representing
Purchaser (if an
Institution):
---------------------------------
Title of Individual
representing
Purchaser (if an
Institution):
---------------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
---------------------------------
-13-
<PAGE>
EXHIBIT 10.6
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
HTR GLOBAL TECHNOLOGY FUND
FEBRUARY 8, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
8, 1995, by and among Genus, Inc. (the "Company"), a California corporation, and
each person executing a signature page hereto (the "Purchasers").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchasers agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchasers, and the Purchasers shall purchase from the Company, severally
and not jointly, upon the terms and conditions hereinafter set forth, a number
of shares (the "Shares") of the Company's Common Stock (the "Common Stock")
determined by dividing the Aggregate Purchase Price set forth on the signature
page of this Agreement by the Per Share Purchase Price (as hereinafter defined).
The "Per Share Purchase Price" shall be determined by multiplying 85% by the
average of the last sale prices, regular way, of the Common Stock, as reported
by The NASDAQ National Market for the period of five consecutive Trading Days
prior to the February 10, 1995 (the "Pricing Date"). "Trading Day" means a day
on which there is one or more sales, regular way, of the Common Stock reported
by The NASDAQ National Market, whether or not trading is interrupted for any
portion of such day.
(b) The Company shall have no obligation hereunder with respect to
the Purchasers until the Company shall execute and deliver to the Purchasers an
executed copy of this Agreement. If this Agreement is not executed and
delivered by the Company or the offering is terminated, this Agreement shall be
of no further force or effect.
(c) This Agreement and the respective obligations of the Purchasers
and the Company hereunder shall terminate if the Closing (as hereinafter
defined) has not occurred by February 28, 1995 for any reason; provided,
however, that such termination shall not excuse a material breach of this
Agreement by either party prior to such termination.
SECTION 2. DELIVERY OF THE COMMON STOCK AT THE CLOSING. The completion
of the purchase and sale of the Shares (the "Closing") shall occur at the law
offices of Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, 650
Page Mill Road, Palo Alto, California 94304-1050 (Telephone No. 415.493.9300;
Facsimile No. 415.493.6811) at 10:00 a.m. on February 17, 1995 (the "Closing
Date"), or such later date prior to February 28, 1995 as the Company and the
Purchasers may agree, subject to the satisfaction (or waiver) of the conditions
hereinafter set forth. At the Closing, each Purchaser shall make payment of the
full purchase price of the Shares being purchased by the Purchaser at the
Closing. At the Closing, the Company shall deliver to each Purchaser one or
more stock certificates registered in the name of the Purchaser,
<PAGE>
or in such name or names as may be designated by the Purchaser, representing the
number of Shares purchased by the Purchaser in accordance with Section 1. The
name(s) in which the stock certificates are to be registered are set forth on
the signature page to this Agreement. The Purchasers shall provide written
instructions to the Company at least one day prior to the Closing specifying the
names and addresses of the persons who are to accept delivery of the Shares on
behalf of the Purchasers.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchasers as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material Adverse
Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the stockholders of the Company or
any liens or encumbrances.
3.4 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12)
-2-
<PAGE>
months preceding the date of this Agreement. As of their respective filing
dates, all documents filed by the Company with the SEC (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act of 1933, as amended (the "Securities Act"), as applicable.
Neither the Company's Private Placement Offering Memorandum dated December 1994
(the "Memorandum") nor any of the SEC Documents as of their respective dates
contained any untrue statement of material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements made
therein, in the light of the circumstances under which they were made, not
misleading. The financial statements of the Company included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto. The Financial Statements have
been prepared in accordance with generally accepted accounting principles
consistently applied and fairly present the consolidated financial position of
the Company and any Subsidiaries at the dates thereof and the consolidated
results of their operations and consolidated cash flows for the periods then
ended (subject, in the case of unaudited statements, to normal, recurring
adjustments).
3.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
NASDAQ National Market Notification Form with The NASDAQ National Market and
Form 10-C with the SEC.
3.6 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since September 30, 1994, there have not been any changes in the assets,
liabilities, financial condition, business prospects or operations of the
Company from that reflected in the Financial Statements except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
3.7 INTELLECTUAL PROPERTY. To the Company's knowledge, each of the
Company and its Subsidiaries owns or possesses adequate rights to use all
material patents, patent rights, inventions, trade secrets and know-how
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business as described in the Memorandum;
neither the Company nor any of its subsidiaries has received any notice of, or
has any knowledge of, any infringement of or conflict with asserted rights of
others with respect to any patent, patent right, invention, trade secret or
know-how that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, could reasonably be expected to have a
Material Adverse Effect.
-3-
<PAGE>
3.8 AUTHORIZED CAPITAL STOCK. The authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock, no par value, and
2,000,000 shares of Preferred stock, no par value, of which, 12,833,495 shares
of Common Stock and no shares of Preferred Stock were outstanding at February 2,
1995.
3.9 LITIGATION. There are no actions, suits proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties before or by any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood (in the judgment of the Company) of an adverse decision
that (a) could have a Material Adverse Effect or (b) could impair the ability of
the Company to perform in any material respect its obligations under this
Agreement.
3.10 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS.
Each Purchaser represents and warrants, severally and not jointly, to the
Company as follows:
4.1 ACCREDITED INVESTOR. The Purchaser is an "accredited investor"
within the meaning of Rule 501(a) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith. The
Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risk of the
-4-
<PAGE>
prospective investment. The Purchaser's financial condition and investments are
such that it is in a financial position to hold the Shares for an indefinite
period of time and to bear the economic risk of, and withstand a complete loss
of, its investment in the Shares.
4.3 AUTHORITY. The Purchaser has full right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Purchaser and by the Company, this Agreement shall constitute a valid and
binding obligation of the Purchaser, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' and contracting
parties' rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully examined the
Memorandum and the SEC Documents. The Purchaser acknowledges that the Company
has made available to the Purchaser all documents and information that it has
requested relating to the Company and has provided answers to all of its
questions concerning the Company and the Shares. In evaluating the suitability
of the acquisition of the Shares hereunder, the Purchaser has not relied upon
any representations or other information (whether oral or written) other than as
set forth in the SEC Documents, the Memorandum or as contained herein.
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) No later than thirty (30) days after the date hereof, the Company
shall prepare and file a registration statement on Form S-3 with the SEC under
the Securities Act to register the resale of the Shares by the Purchasers (the
"Registration Statement").
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and each Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by such Purchaser. "Registration Expenses" shall mean all
expenses, except for Selling Expenses, incurred by the Company in complying with
the registration provisions herein described, including, without limitation, all
registration,
-5-
<PAGE>
qualification and filing fees, printing expenses, escrow fees, fees and
disbursements of counsel for the Company, blue sky fees and expenses and the
expense of any special audits incident to or required by any such registration.
"Selling Expenses" shall mean all selling commissions, underwriting fees and
stock transfer taxes applicable to the Shares and all fees and disbursements of
counsel for any Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) the third anniversary
of the Closing Date hereof, (B) such date as all of the Shares have been resold
by the Purchasers or (C) such time as all of the Shares held by the Purchasers
can be sold within a given three-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144 promulgated
thereunder ("Rule 144"); (ii) prepare and file with the SEC such amendments and
supplements to the Registration Statement and the prospectus used in connection
with the Registration Statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Registration Statement; (iii) furnish such number of
prospectuses and other documents incident thereto, including any amendment of or
supplement to the prospectus, as a Purchaser from time to time may reasonably
request; (iv) cause all Shares registered as described herein to be listed on
each securities exchange and quoted on each quotation service on which similar
securities issued by the Company are then listed or quoted; (v) provide a
transfer agent and registrar for all Shares registered pursuant to the
Registration Statement and a CUSIP number for all such Shares; (vi) otherwise
use its best efforts to comply with all applicable rules and regulations of the
SEC; and (vii) file the documents required of the Company and otherwise use its
best efforts to maintain requisite blue sky clearance in (A) all jurisdictions
in which any of the Shares are originally sold and (B) all other states
specified in writing by a Purchaser, provided as to Clause (B), however, that
the Company shall not be required to qualify to do business or consent to
service of process in any state in which it is not now so qualified or has not
so consented.
(d) The Company shall furnish to each Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchasers the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
a Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3, the Company covenants and agrees to: (i)
make and keep public information available as those terms are understood and
defined in Rule 144, until the earlier of (a) the third anniversary of the
Closing Date or (b) such date as all of the Shares shall have been resold by the
Purchasers; (ii) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and (iii) furnish to any Purchaser upon request, as long as the Purchaser owns
any Shares, (A) a written statement by the Company that it has
-6-
<PAGE>
complied with the reporting requirements of the Securities Act and the Exchange
Act, (B) a copy of the most recent annual or quarterly report of the Company,
and (C) such other information as may be reasonably requested in order to avail
any Purchaser of any rule or regulation of the SEC that permits the selling of
any such Shares without registration or pursuant to a registration statement on
Form S-3.
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The undersigned hereby
covenants that it will not sell any Shares pursuant to said prospectus during
the period commencing at the time at which the Company gives the undersigned
notice of the suspension of the use of said prospectus and ending at the time
the Company gives the undersigned notice that the undersigned may thereafter
effect sales pursuant to said prospectus, as the same may have been supplemented
or amended. In the event of any suspension of use of a Registration Statement
pursuant to this paragraph, the time period during which the Company is
obligated to maintain the effectiveness of such Registration Statement pursuant
to this Agreement shall be tolled for the duration of the period during which
use of the Registration Statement was suspended.
6.2 FINANCIAL INFORMATION. The Company will mail the following reports
to each Purchaser until such Purchaser transfers, assigns or sells the Shares
purchased by such Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
6.3 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Purchaser
from and against all losses, claims, damages, liabilities and expenses (or
actions or proceedings in respect thereof) to which such Purchaser may become
subject (under the Securities Act or otherwise) insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of, or are based upon any untrue statement of a material fact contained
-7-
<PAGE>
in the Registration Statement, on the effective date thereof, or arise out of
any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will, as incurred, reimburse such
Purchaser for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim; provided,
however, that the Company shall not be liable in any such case to the extent
that such loss, claim, damage or liability arises out of, or is based upon (i)
an untrue statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Purchaser specifically for use in preparation of the Registration
Statement, (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Section 7.3 hereof, or (iii) any untrue statement in any
prospectus that is corrected in any subsequent prospectus that was delivered to
the Purchaser prior the pertinent sale or sales by the Purchaser.
(b) Each Purchaser, severally and not jointly, agrees to indemnify
and hold harmless the Company from and against any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) to which the Company
may become subject (under the Securities Act or otherwise) insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser
specifically for use in preparation of the Registration Statement, provided,
however, that no Purchaser shall be liable in any such case for any untrue
statement included in any prospectus which statement has been corrected, in
writing, by such Purchaser and delivered to the Company before the sale from
which such loss occurred, (ii) the failure of such Purchaser to comply with the
covenants and agreements contained in Section 7.3 hereof, or (iii) any untrue
statement in any prospectus that is corrected in any subsequent prospectus that
was delivered to the Purchaser prior to the pertinent sale or sales by the
Purchaser, and each Purchaser, severally and not jointly, will, as incurred,
reimburse the Company for any legal or other expenses reasonably incurred in
investigating, defending or preparing to defend any such action, proceeding or
claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.3, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel
-8-
<PAGE>
to represent both the indemnified person and such indemnifying person or any
affiliate or associate thereof, the indemnified person shall be entitled to
retain its own counsel at the expense of such indemnifying person.
(d) If the indemnification provided for in this Section 6.3 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or a Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchasers were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Purchaser shall be required to contribute
any amount in excess of the amount by which the net amount received by the
Purchaser from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Purchasers' obligations in this subsection (d) to contribute are several in
proportion to their respective sales of Shares to which such loss relates, and
not joint.
(e) The obligations of the Company and the Purchasers under this
Section 6.3 shall be in addition to any liability which the Company and any
respective Purchaser may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls the Company or any
Purchaser within the meaning of the Securities Act.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
SECURITIES ACT.
-9-
<PAGE>
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
7.3 TRANSFER OF SHARES AFTER REGISTRATION. Each Purchaser hereby
covenants with the Company not to make any sale of the Shares except either (i)
in accordance with the Registration Statement, in which case Purchaser covenants
to comply with the requirement of delivering a current prospectus, or (ii) in
accordance with Rule 144, in which case Purchaser covenants to comply with Rule
144. Purchaser further acknowledges and agrees that such Shares are not
transferable on the books of the Company unless the certificate submitted to the
Company's transfer agent evidencing such Shares is accompanied by a separate
certificate executed by an officer of, or other person duly authorized by, the
Purchaser in the form attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. Each Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding such Purchaser or such Purchaser's "Plan of
Distribution."
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASERS. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made,
-10-
<PAGE>
and shall be true and correct in all material respects on the Closing Date with
the same force and effect as if they had been made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price of not less than $10 million.
8.4 OPINION OF COMPANY'S COUNSEL. The Purchasers shall have received
at the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional
Corporation, counsel to the Company, an opinion in form and substance reasonably
satisfactory to the Purchasers and their counsel.
8.5 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.6 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.7 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchasers a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.8 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchasers at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
-11-
<PAGE>
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchasers on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. The Purchasers shall purchase Shares
at the Closing for an aggregate purchase price not less than $10 million.
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. Each Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless each Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopier/facsimile (unless the addressee has not provided a valid
telecopier/facsimile number for such purpose) and either first class mail,
postage prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747.7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-4088, or to
such other person at such other place as the Company shall designate to the
Purchaser in writing;
-12-
<PAGE>
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchasers.
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in
-13-
<PAGE>
connection with this Agreement and the transactions contemplated hereby whether
or not the transactions contemplated hereby are consummated.
SECTION 19. PUBLICITY. No Purchaser shall issue any press releases
or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By /s/ Todd S. Myhre
------------------------------------
Its President & Chief Operating Officer
-----------------------------------
-11-
<PAGE>
PURCHASER
Print or Type:
Name of Purchaser (Institution): HTR GLOBAL TECHNOLOGY FUND
Name of Individual representing
Purchaser: THE ROYAL BANK OF SCOTLAND PLC
Title of Individual representing
Purchaser: TRUSTEE
Signature by:
Individual representing
Purchaser: THE ROYAL BANK OF SCOTLAND PLC
UNIT TRUST OPERATIONS TRUST
Officer
Address: THE ROYAL BANK OF SCOTLAND PLC
UNIT TRUST OPERATIONS
REGENT'S HOUSE, 42 ISLINGTON
HIGHT ST.
LONDON N1 8XL UK
Telephone: 071-615-2956
Facsimile: 071-226-6985
Telex: 884172/887922
AGGREGATE PURCHASE PRICE: $700,000.00
NAME IN WHICH SHARES ARE
TO BE REGISTERED: CEDE & CO.
Signature Page to Genus, Inc.
Common Stock Purchase Agreement
Dated February 8, 1995
-12-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
- -------------------------------------------------------------------------------
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, or (ii) in accordance with Rule 144 under the
Securities Act of 1933 ("Rule 144"), in which case the Purchaser certifies that
it has complied with or will comply with the requirements of Rule 144.
Print or type:
Name of Purchaser:
------------------------------
Name of Individual
representing
Purchaser (if an
Institution):
------------------------------
Title of Individual
representing
Purchaser (if an
Institution):
------------------------------
Signature by:
Purchaser or
Individual repre-
senting Purchaser:
------------------------------
-13-
<PAGE>
EXHIBIT 10.7
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
WITH
BACHOW INVESTMENT PARTNERS, III, L.P.
PAUL S. BACHOW CO-INVESTMENT FUND, L.P. AND
PAUL S. BACHOW
FEBRUARY 10, 1995
<PAGE>
GENUS, INC.
COMMON STOCK PURCHASE AGREEMENT
This COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made as of February
10, 1995, by and among Genus, Inc. (the "Company"), a California corporation,
and Bachow Investment Partners III, L.P., Paul S. Bachow Co-Investment Fund,
L.P., Paul S. Bachow and their nominees (collectively, the "Purchaser").
IN CONSIDERATION of the mutual covenants contained in this Agreement, the
Company and the Purchaser agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE THE COMMON STOCK.
(a) At the Closing (as defined in Section 2), the Company shall sell
to the Purchaser, and the Purchaser shall purchase from the Company upon the
terms and conditions hereinafter set forth, 1,178,967 shares (the "Shares") of
the Company's Common Stock (the "Common Stock") for an aggregate purchase price
of $8,000,000 (the "Purchase Price").
(b) This Agreement and the respective obligations of the Purchaser
and the Company hereunder shall terminate if the Funding (as hereinafter
defined) has not occurred by March 15, 1995 for any reason; provided, however,
that such termination shall not excuse a material breach of this Agreement by
either party prior to such termination.
SECTION 2. CLOSING AND FUNDING. The closing of the purchase and sale
of the Shares (the "Closing") shall occur at the law offices of Wilson, Sonsini,
Goodrich & Rosati, Professional Corporation, 650 Page Mill Road, Palo Alto,
California 94304-1050 (Telephone No. 415.493.9300; Facsimile No. 415.493.6811)
at 10:00 a.m. on February 17, 1995 (the "Closing Date"), or such later date as
the Company and the Purchaser may agree, subject to the satisfaction (or waiver)
of the conditions hereinafter set forth. At the Closing, the Company shall
deliver to Wilson, Sonsini, Goodrich & Rosati, Professional Corporation, as
escrow agent (the "Escrow Agent"), one or more stock certificates (as requested
by the Purchaser) registered in the name of the Purchaser, or in such name or
names as may be designated by the Purchaser, representing the Shares. The
Purchaser shall provide written instructions to the Company at least one day
prior to the Closing specifying the name or names in which the certificate or
certificates representing the Shares shall be registered.
On or before March 13, 1995 (the "Funding Date"), the Purchaser shall
deliver the Purchase Price to the Escrow Agent (the "Funding"). Upon receipt of
the payment of the Purchase Price (by wire transfer and without interest or
abatement), the Escrow Agent shall deliver to the Purchaser via overnight
courier one or more stock certificates (as requested by the Purchaser)
registered in the name of the Purchaser, or in such name or name as has been
designated by the Purchaser, representing the Shares.
<PAGE>
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Purchaser as of the Closing Date as follows:
3.1 ORGANIZATION. The Company is a corporation duly organized and
validly existing and in good standing under the laws of the State of California.
The Company has all requisite corporate power and authority to own, lease and
operate its properties and assets, and to carry on its business as presently
conducted and as proposed to be conducted. The Company is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the condition (financial or
otherwise), assets, business, business prospects or results of operations of the
Company and its Subsidiaries (as hereinafter defined) taken as a whole (a
"Material Adverse Effect").
3.2 SUBSIDIARIES. All of the Company's subsidiaries (the
"Subsidiaries") are listed on Exhibit 21 to the Company's Annual Report on Form
10-K for the Year Ended December 31, 1993 (the "Form 10-K"). Each of the
Company's Subsidiaries is a corporation duly incorporated, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, has
full corporate power and authority to own and lease its properties, and to carry
on its business as presently conducted, is duly qualified, registered or
licensed as a foreign corporation to do business and is in good standing in each
jurisdiction in which the ownership or leasing of its properties or the
character of its present operations make such qualification, registration or
licensing necessary, except where the failure so to qualify or be in good
standing would not have a Material Adverse Effect. The Company owns, directly
or indirectly, all of the outstanding shares of capital stock of each of its
Subsidiaries free of any lien, restriction (other than restrictions generally
applicable to securities under federal, provincial or state securities laws) or
encumbrance, and said shares have been duly issued and are validly outstanding.
3.3 AUTHORITY. The Company has full corporate right, power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. Upon the execution and delivery of this Agreement by the
Company and by the Purchaser, this Agreement shall constitute a valid and
binding obligation of the Company, enforceable in accordance with its terms,
except as the indemnification and contribution provisions hereof may be limited
by applicable securities laws and except as the enforceability hereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and except as enforceability
hereof may be subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law); and the
performance of this Agreement and the consummation of the transactions herein
contemplated will not result in any violation or breach of any law, order, rule,
regulation, writ, injunction, judgment or decree of any court or governmental
agency or body or of the Company's articles of incorporation or bylaws or any
material contract.
-2-
<PAGE>
3.4 ISSUANCE AND DELIVERY OF THE SHARES. The Shares, when issued in
compliance with the provisions of this Agreement, will be validly issued, fully
paid and nonassessable. The issuance and delivery of the Shares is not subject
to preemptive or any other similar rights of the shareholders of the Company or
any liens or encumbrances or other restrictions except as arising hereunder.
3.5 PRIVATE PLACEMENT OFFERING MEMORANDUM; SEC DOCUMENTS; FINANCIAL
STATEMENT. The Company has filed in a timely manner all documents that the
Company was required to file with the Securities and Exchange Commission (the
"SEC") under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), during the twelve (12) months preceding
the date of this Agreement. As of their respective filing dates, all documents
filed by the Company with the SEC (the "SEC Documents") complied in all material
respects with the requirements of the Exchange Act or the Securities Act of
1933, as amended (the "Securities Act"), as applicable. Neither the Company's
Private Placement Offering Memorandum dated December 1994 (the "Memorandum") nor
any of the SEC Documents as of their respective dates contained any untrue
statement of material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements made therein, in the light of
the circumstances under which they were made, not misleading. The financial
statements of the Company included in the SEC Documents (the "Financial
Statements") comply as to form in all material respects with applicable
accounting requirements and with the published rules and regulations of the SEC
with respect thereto. The Financial Statements have been prepared in accordance
with generally accepted accounting principles consistently applied and fairly
present the consolidated financial position of the Company and any Subsidiaries
at the dates thereof and the consolidated results of their operations and
consolidated cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal, recurring adjustments).
3.6 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state, or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement except for (a) compliance with the securities and
blue sky laws in the states in which Shares are offered and/or sold, which
compliance will be effected in accordance with such laws, (b) the filing of the
Registration Statement (as hereinafter defined) all amendments thereto with the
SEC as contemplated by Section 6 of this Agreement and (c) the filing of The
Nasdaq National Market Notification Form with The Nasdaq National Market and
Form 10-C with the SEC.
3.7 NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed herein,
since the respective dates as of which the information is disclosed therein,
there have not been any changes in the assets, liabilities, financial condition,
business prospects or operations of the Company from that reflected in the SEC
Documents, the Financial Statements and the Memorandum, except changes in the
ordinary course of business which have not been, either individually or in the
aggregate, materially adverse.
-3-
<PAGE>
3.8 INTELLECTUAL PROPERTY. Each of the Company and its Subsidiaries
owns or possesses adequate rights to use all material patents, patent rights,
inventions, trade secrets, copyrights, licenses and know-how or similar rights
described or referred to in the Memorandum as owned or used by it or that are
necessary for the conduct of its business (as now conducted and as proposed to
be conducted) as described in the Memorandum; neither the Company nor any of its
Subsidiaries has received any notice of, or has any knowledge of, any
infringement of or conflict with asserted rights of others with respect to any
patent, patent right, invention, trade secret, copyright, license or know-how
that, individually or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could reasonably be expected to have a Material
Adverse Effect.
3.9 AUTHORIZED CAPITAL STOCK. At February 2, 1995, the authorized
capital stock of the Company consisted of 20,000,000 shares of Common Stock, no
par value, and 2,000,000 shares of Preferred stock, no par value, of which,
12,833,495 shares of Common Stock (subject only to subsequent issuances pursuant
to the exercise of stock options outstanding on February 2, 1995) and no shares
of Preferred Stock were outstanding. Subsequent to February 2, 1995, the
Company has entered into stock purchase agreements to sell $9.5 million of
Common Stock (excluding the Shares to be purchased hereunder) for $6.99 per
share.
3.10 LITIGATION. There are no actions, suits, proceedings or
investigations pending or, to the best of the Company's knowledge, threatened
against the Company or any of its properties (including, without limitation,
intellectual property rights) or assets before or by any court or arbitrator or
any governmental body, agency or official in which there is a reasonable
likelihood of an adverse decision that (a) could have a Material Adverse Effect
or (b) could impair the ability of the Company to perform in any material
respect its obligations under this Agreement.
3.11 USE OF PROCEEDS. The Company will apply the net proceeds from the
sale of the shares in the manner set forth in the Memorandum.
SECTION 4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER.
The Purchaser represents and warrants to the Company as follows:
4.1 ACCREDITED INVESTOR. Based solely on the representations and
warranties received from its investors, which the Purchaser has no reason to
believe are inaccurate, the Purchaser is an "accredited investor" within the
meaning of Rule 501(a)(8) of the Securities Act.
4.2 INVESTMENT REPRESENTATIONS. The Purchaser is aware that the Shares
have not been registered under the Securities Act or any applicable state
securities laws, and agrees that the Shares will not be offered or sold in the
absence of registration under the Securities Act and any applicable state
securities laws or an exemption from the registration requirements of the
Securities Act and any applicable state securities laws.
-4-
<PAGE>
The Purchaser understands that the offering and sale of the Shares is
intended to be exempt from registration under the Securities Act, by virtue of
Section 4(2) and/or Section 4(6) of the Securities Act and the provisions of
Regulation D promulgated thereunder, based, in part, upon the representations,
warranties and agreements contained in this Agreement and the Company may rely
on such representations, warranties and agreements in connection therewith.
Assuming the Company is in compliance with its obligations under this Agreement,
the Purchaser will not transfer the Shares in violation of the provisions of any
applicable federal or state securities laws.
The Purchaser is acquiring the Shares for its own account and for
investment, and not with a view to the distribution thereof or with any present
intention of distributing or selling any of the Shares except in compliance with
the Securities Act. The Purchaser represents that by reason of its business and
financial experience, and the business and financial experience of those
persons, if any, retained by it to advise it with respect to its investment in
the Shares, such Purchaser together with such advisers have such knowledge,
sophistication and experience in business and financial matters as to be capable
of evaluating the merits and risks of the prospective investment. The
Purchaser's financial condition and investments are such that it is in a
financial position to hold the Shares for an indefinite period of time and to
bear the economic risk of, and withstand a complete loss of, its investment in
the Shares.
4.3 AUTHORITY. The Purchaser has full corporation, partnership or
other right (as appropriate), power, authority and capacity to enter into this
Agreement and to consummate the transactions contemplated hereby. Upon the
execution and delivery of this Agreement by the Purchaser and by the Company,
this Agreement shall constitute a valid and binding obligation of the Purchaser,
enforceable in accordance with its terms, except as the indemnification and
contribution provisions hereof may be limited by applicable securities laws and
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
and except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
4.4 PURCHASER REVIEW. The Purchaser has carefully read the Memorandum
and the SEC Documents. The Purchaser acknowledges that the Company has made
available to the Purchaser all documents and information that it has requested
relating to the Company and has provided answers to all of its questions
concerning the Company and the Shares. In evaluating the suitability of the
acquisition of the Shares hereunder, the Purchaser has not relied upon any
representations or other information provided by the Company (whether oral or
written) other than as set forth in the SEC Documents, the Memorandum or as
contained herein. The foregoing sentences of this Section 4.4 shall not affect
the Purchaser's rights hereunder arising from a breach by the Company of any
representation, warranty or covenant.
-5-
<PAGE>
SECTION 5. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchaser herein shall survive the execution of this Agreement, the delivery
to the Purchaser of the Shares being purchased and the payment therefor.
SECTION 6. AFFIRMATIVE COVENANTS OF THE COMPANY.
6.1 REGISTRATION REQUIREMENTS.
(a) Before February 17, 1996, the Company shall prepare and file a
registration statement on Form S-3 (or other applicable form) with the SEC under
the Securities Act to register the resale of the Shares by the Purchaser (the
"Registration Statement"). After the Registration Statement has been filed, the
Company will use its diligent efforts to have the Registration Statement
declared effective as soon as possible.
(b) The Company shall pay all Registration Expenses (as defined
below) in connection with any registration, qualification or compliance
hereunder, and the Purchaser shall pay all Selling Expenses (as defined below)
and other expenses that are not Registration Expenses relating to the Shares
resold by the Purchaser. "Registration Expenses" shall mean all expenses,
except for Selling Expenses, incurred by the Company in complying with the
registration provisions herein described, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses
and the expense of any special audits incident to or required by any such
registration. "Selling Expenses" shall mean all selling commissions,
underwriting fees and stock transfer taxes applicable to the Shares and all fees
and disbursements of counsel for the Purchaser.
(c) In the case of the registration effected by the Company pursuant
to these registration provisions, the Company will use its best efforts to: (i)
keep such registration effective until the earlier of (A) February 16, 1998, (B)
such date as all of the Shares have been resold by the Purchaser or (C) such
time as all of the Shares held by the Purchaser can be sold within a given
three-month period without compliance with the registration requirements of the
Securities Act pursuant to Rule 144 promulgated thereunder ("Rule 144"); (ii)
prepare and file with the SEC such amendments and supplements to the
Registration Statement and the prospectus used in connection with the
Registration Statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by the
Registration Statement; (iii) furnish such number of prospectuses and other
documents incident thereto, including any amendment of or supplement to the
prospectus, as the Purchaser from time to time may reasonably request; (iv)
cause all Shares registered as described herein to be listed on each securities
exchange and quoted on each quotation service on which similar securities issued
by the Company are then listed or quoted; (v) provide a transfer agent and
registrar for all Shares registered pursuant to the Registration Statement and a
CUSIP number
-6-
<PAGE>
for all such Shares; (vi) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC; and (vii) file the documents
required of the Company and otherwise use its best efforts to maintain requisite
blue sky clearance in (A) all jurisdictions in which any of the Shares are
originally sold and (B) all other states specified in writing by the Purchaser,
provided as to Clause (B), however, that the Company shall not be required to
qualify to do business or generally consent to service of process in any state
in which it is not now or at the relevant time in the future so qualified or has
not so consented.
(d) The Company shall furnish to the Purchaser upon request a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary in order to facilitate the public sale or other
disposition of all or any of the Shares held by the Purchaser.
(e) With a view to making available to the Purchaser the benefits of
Rule 144 and any other rule or regulation of the SEC that may at any time permit
the Purchaser to sell Shares to the public without registration or pursuant to a
registration statement on Form S-3 (or other applicable form), the Company
covenants and agrees to: (i) make and keep public information available as those
terms are understood and defined in Rule 144, until such date as all of the
Shares shall have been resold by the Purchaser; (ii) file with the SEC in a
timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and (iii) furnish to the Purchaser upon
request, as long as the Purchaser owns any Shares, (A) a written statement by
the Company that it has complied with the reporting requirements of the
Securities Act and the Exchange Act, (B) a copy of the most recent annual or
quarterly report of the Company, and (C) such other information as may be
reasonably requested in order to avail the Purchaser of any rule or regulation
of the SEC that permits the selling of any such Shares without registration or
pursuant to a registration statement on Form S-3 (or other applicable form).
(f) The undersigned acknowledges that there may occasionally be times
when the Company may be required to suspend the use of the prospectus forming
part of the Registration Statement until such time as an amendment to the
Registration Statement has been filed by the Company and declared effective by
the Commission, until the prospectus is supplemented or amended to comply with
the Securities Act, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The Company agrees to
use diligent efforts to avoid suspensions of the use of the prospectus forming a
part of the Registration Statement and to limit the periods of such suspensions
to the shortest time possible. The undersigned hereby covenants that it will
not sell any Shares pursuant to said prospectus during the period commencing at
the time at which the Company gives the undersigned notice of the suspension of
the use of said prospectus and ending at the time the Company gives the
undersigned notice that the undersigned may thereafter effect sales pursuant to
said prospectus, as the same may have been supplemented or amended. In the
event of any suspension of use of a Registration Statement pursuant to this
paragraph, the time period during which the Company is obligated to maintain the
effectiveness of such Registration Statement pursuant to this
-7-
<PAGE>
Agreement shall be tolled for the duration of the period during which use of the
Registration Statement was suspended.
6.2 COMPANY REGISTRATION.
(a) If between the Closing Date and the effective date of the
Registration Statement contemplated by Section 6.1, the Company shall determine
to register (or be required to register) any of its securities, either for its
own account or the account of a security holder or holders, other than a
registration relating solely to employee benefit plans or a registration
relating solely to a transaction under Rule 145 under the Securities Act, the
Company will:
(i) promptly give to the Purchaser written notice thereof; and
(ii) include in such registration (and any related qualification
under blue sky laws or other compliance), and in any underwriting involved
therein, all the Shares specified in a written request or requests, made within
20 days after receipt of such written notice from the Company, by the Purchaser.
(b) If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so
advise the Purchaser as a part of the written notice given pursuant to paragraph
6.2(a)(i). In such event the right of the Purchaser to registration pursuant to
this paragraph 6.2 shall be conditioned upon the Purchaser's participation in
such underwriting and the inclusion of Shares in the underwriting to the extent
provided herein. The Purchaser shall (together with the Company and the other
holders distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the managing underwriter selected
for such underwriting by the Company.
Notwithstanding any other provision of this paragraph 6.2, if the
managing underwriter determines that marketing factors require a limitation of
the number of shares to be underwritten, the managing underwriter may limit the
Shares on a pro rata basis with the shares to be offered by other selling
shareholders in such offering or exclude all shares to be sold by selling
stockholders from the offering.
If the Purchaser disapproves of the terms of any such underwriting,
it may elect to withdraw therefrom by written notice to the Company and the
managing underwriter.
6.3 BOARD NOMINATION. The Board of Directors shall amend the bylaws of
the Company to increase the number of authorized directors from four to five
and, within 48 hours after the Funding Date, appoint a representative of the
Purchaser to fill such vacancy until the next annual meeting of shareholders.
The Company shall nominate for director at the next annual shareholders meeting
one person designated by the Purchaser. At all times during which the Purchaser
(alone or together with its affiliates) continues to beneficially own at least
66-2/3% of the Shares, the Company shall cause a designee of the Purchaser to be
nominated for election
-8-
<PAGE>
to the Board of Directors and, in the event Purchaser's representative is not so
elected, the Purchaser shall have the right, for so long as the Purchaser (alone
or together with its affiliates) continues to own at least 25% of the Shares to
attend (as a non-voting observer) all meetings of the Board of Directors of the
Company. The Purchaser shall provide the Company with written notice within
three business days after the Purchaser beneficially owns less than 66-2/3% of
the Shares. Upon receipt of such notice, the Company may request the
representative of the Purchaser then serving on the Board of Directors to
immediately resign and, if so requested, such representative shall resign
immediately. In the event that, for whatever reason, the Company fails to
nominate the Purchaser's representative for election to the Board of Directors
during any period in which the Purchaser is entitled by the terms of this
Agreement to require such nomination, then the Company shall grant to the
Purchaser an immediately vested stock option to purchase an aggregate of 100,000
shares of Common Stock at an exercise price of $10.00 per share, providing for a
term of five years, cashless exercise and for appropriate adjustment in
accordance with the practice of the Company. In the event that, for whatever
reason, the representative designated by the Purchaser is unable to serve as a
member of the Board of Directors, the Company agrees to replace such Board
member (or nominee, if appropriate) with another representative designated by
the Purchaser.
6.4 D&O INSURANCE. The Company shall at all times, during the period a
representative of the Purchaser is a member of the Company's Board of Directors,
maintain director and officer insurance policies containing claims made and tail
coverage with a minimum policy limit of $5,000,000 and with other terms and
conditions as are normal and customary for companies of similar size and
business as the Company.
6.5 OUT-OF-POCKET EXPENSES. The Company shall reimburse the
Purchaser for all reasonable out-of-pocket expenses incurred by the Purchaser
for activities requested by and performed on behalf of the Company.
6.6 FINANCIAL INFORMATION. The Company will mail the following reports
to the Purchaser until the Purchaser transfers, assigns or sells the Shares
purchased by the Purchaser pursuant to this Agreement.
(a) Within one hundred (100) days after the end of each fiscal year,
a copy of its Annual Report on Form 10-K.
(b) Within fifty-five (55) days after the end of the first, second
and third quarterly accounting periods of each fiscal year of the Company, a
copy of its quarterly Report on Form 10-Q.
(c) Within ten (10) days after the Company files any Current Report
on Form 8-K with the SEC, such Current Report on Form 8-K.
-9-
<PAGE>
6.7 INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless the Purchaser
(and each person, if any, who controls the Purchaser within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) from and
against all losses, claims, damages, liabilities and expenses (or actions or
proceedings in respect thereof) to which the Purchaser may become subject (under
the Securities Act or otherwise) insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon any untrue statement of a material fact contained in the Registration
Statement, on the effective date thereof, or arise out of any failure by the
Company to fulfill any undertaking included in the Registration Statement, and
the Company will, as incurred, reimburse the Purchaser for any legal or other
expenses reasonably incurred in investigating, defending or preparing to defend
any such action, proceeding or claim; provided, however, that the Company shall
not be liable in any such case to the extent that such loss, claim, damage or
liability arises out of, or is based upon (i) an untrue statement made in such
Registration Statement in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Purchaser
specifically for use in preparation of the Registration Statement, (ii) the
failure of the Purchaser to comply with the covenants and agreements contained
in Section 7.3 hereof, or (iii) any untrue statement in any prospectus that is
corrected in any subsequent prospectus that was delivered to the Purchaser prior
to the pertinent sale or sales by the Purchaser.
(b) The Purchaser agrees to indemnify and hold harmless the Company
(and each person, if any, who controls the Company within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act) from and against any
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) to which the Company may become subject (under the Securities Act or
otherwise) insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of, or are based upon (i) an untrue
statement made in such Registration Statement in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the
Purchaser specifically for use in preparation of the Registration Statement,
provided, however, that the Purchaser shall not be liable in any such case for
any untrue statement included in any prospectus which statement has been
corrected, in writing, by the Purchaser and delivered to the Company before the
sale from which such loss occurred, (ii) the failure of the Purchaser to comply
with the covenants and agreements contained in Section 7.3 hereof, or (iii) any
untrue statement in any prospectus that is corrected in any subsequent
prospectus that was delivered to the Purchaser prior to the pertinent sale or
sales by the Purchaser, and the Purchaser will, as incurred, reimburse the
Company for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6.7, such
indemnified person shall notify the indemnifying person in writing of such claim
or of the commencement of such action, and, subject to the provisions
-10-
<PAGE>
hereinafter stated, in case any such action shall be brought against an
indemnified person and the indemnifying person shall have been notified thereof,
the indemnifying person shall be entitled to participate therein, and, to the
extent that it shall wish, to assume the defense thereof, with counsel
reasonably satisfactory to the indemnified person. After notice from the
indemnifying person to such indemnified person of the indemnifying person's
election to assume the defense thereof, the indemnifying person shall not be
liable to such indemnified person for any legal expenses subsequently incurred
by such indemnified person in connection with the defense thereof; provided,
however, that if there exists or shall exist a conflict of interest that would
make it inappropriate in the reasonable judgment of the indemnified person for
the same counsel to represent both the indemnified person and such indemnifying
person or any affiliate or associate thereof, the indemnified person shall be
entitled to retain its own counsel at the expense of such indemnifying person.
No indemnification provided for in Section 6.7(a) or 6.7(b) shall be available
to any party who shall fail to give notice as provided in this Section 6.7(c) if
the party to whom notice was not given was unaware of the proceeding to which
such notice would have related and was prejudiced by the failure to give such
notice, but the omission so to notify such indemnifying party of any such
action, suit or proceeding shall not relieve it from any liability that it may
have to any indemnified party for contribution or indemnification otherwise than
under this Section.
(d) If the indemnification provided for in this Section 6.7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceeding in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand and the Purchaser
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the Purchaser on the other hand, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Purchaser agree that it would not be just and
equitable if any contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Purchaser were treated as one entity for such
purposes) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, or liabilities (or actions in respect thereof) referred to
above in this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), the Purchaser shall not be required to
contribute any amount in excess of the amount by which the net amount received
by the Purchaser from the sale of the Shares to which such loss relates exceeds
the amount of any damages which the Purchaser has
-11-
<PAGE>
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Purchaser's obligations in this subsection
(d) to contribute are several in proportion to their respective sales of Shares
to which such loss relates, and not joint.
(e) The obligations of the Company and the Purchaser under this
Section 6.7 shall be in addition to any liability which the Company and the
Purchaser may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Company or the Purchaser
within the meaning of the Securities Act.
6.8 SUBSEQUENT ACTIONS. The Company covenants to make all filings
required by the securities and blue sky laws in the states in which Shares are
offered and/or sold and to file the Nasdaq National Market Notification Form
with The Nasdaq National Market and the Form 10-C with the SEC.
SECTION 7. RESTRICTIONS ON TRANSFERABILITY OF SHARES; COMPLIANCE WITH
Securities Act; Covenants of Purchaser.
7.1 RESTRICTIONS ON TRANSFERABILITY. The Shares shall not be
transferable in the absence of an effective registration statement under the
Securities Act or an exemption therefrom or in the absence of compliance with
any term of this Agreement. The Company shall be entitled to give stop transfer
instructions to its transfer agent with respect to the Shares in order to
enforce the foregoing restrictions.
7.2 RESTRICTIVE LEGEND. The certificate or certificates representing
the Shares shall bear the following legend restricting transfer:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT, PROVIDED THAT, IF REQUESTED BY THE COMPANY, AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM AND SUBSTANCE IS FURNISHED TO THE COMPANY
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
IS AVAILABLE."
The certificate shall also include any legend required by any applicable state
securities laws.
-12-
<PAGE>
7.3 TRANSFER OF SHARES AFTER REGISTRATION. The Purchaser hereby
covenants with the Company not to make any sale of the Shares except (i) in
accordance with the Registration Statement, in which case the Purchaser
covenants to comply with the requirement of delivering a current prospectus,
(ii) in the case of a transfer under Rule 144, in accordance with Rule 144, in
which case the Purchaser covenants to comply with Rule 144 or (iii) in any other
case, in accordance with Section 4(1) under the Securities Act or in any other
transaction not requiring registration under the Securities Act. Purchaser
further acknowledges and agrees that such Shares are not transferable on the
books of the Company unless the certificate submitted to the Company's transfer
agent evidencing such Shares is accompanied by a separate certificate executed
by an officer of, or other person duly authorized by, the Purchaser in the form
attached hereto as EXHIBIT A.
7.4 PURCHASER INFORMATION. The Purchaser covenants that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding the Purchaser or the Purchaser's "Plan of
Distribution."
7.5 PAYMENT OF PURCHASE PRICE. The Purchaser and the Company hereby
covenant and agree with each other that, upon satisfaction of the conditions to
Closing set forth in Sections 8 and 9 hereof, there shall be no additional
conditions to be satisfied on the part of the parties hereto (other than the
passage of time from the Closing Date to the Funding Date) with respect to the
Purchaser's obligation to deposit the Purchase Price with the Escrow Agent on
the Funding Date or the Escrow Agent's obligation to deliver the stock
certificate or certificates evidencing the Shares to the Purchaser after receipt
of such Purchase Price.
7.6 ONE YEAR LOCK-UP. Without the prior written consent of the
Company, the Purchaser will not offer, sell, or otherwise dispose of any of the
Shares prior to February 17, 1996, other than (i) pursuant to a Company
registration in accordance with Section 6.2 hereof, (ii) pursuant to a merger,
tender offer or other change of control transaction approved by the Board of
Directors or the shareholders of the Company or not actively opposed by the
Board of Directors, (iii) in the event of a material adverse change in the
business, financial condition or results of operations of the Company and its
Subsidiaries considered as one enterprise, or (iv) in the event that more than
two management shareholders sell more than 25% of the shares of Common Stock
(including vested stock options) then held by them prior to February 17, 1996,
in which case the Purchaser shall be released from this lock-up provision with
respect to that percentage of the Shares equal to the highest percentage sold by
any such management shareholder. For purposes of this provision, "management
shareholders" shall consist of William W.R. Elder, Todd S. Myhre, Bill Cole,
Kevin Conlan, John Aldeborgh and James Burns.
SECTION 8. CONDITIONS TO OBLIGATIONS OF PURCHASER. The obligation of
the Purchaser to purchase the Shares set forth on the signature page hereof at
the Closing is subject to the fulfillment on or prior to the Closing Date of the
following conditions, any or all of which may be waived at the option of the
Purchaser:
-13-
<PAGE>
8.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 hereof shall be true and correct in
all material respects when made, and shall be true and correct in all material
respects on the Closing Date with the same force and effect as if they had been
made on and as of said date.
8.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Company on or prior to the Closing Date
shall have been performed or complied with in all material respects.
8.3 MINIMUM AGGREGATE INVESTMENT. [Deliberately omitted.]
8.4 DELIVERY OF SHARES TO ESCROW AGENT. The Company shall have
delivered to the Escrow Agent one or more stock certificates registered in the
name of the Purchaser (in such denominations requested by the Purchaser), or in
such name or names as may be designated by the Purchaser, representing the
Shares.
8.5 OPINION OF COMPANY'S COUNSEL. The Purchaser shall have received at
the Closing from Wilson, Sonsini, Goodrich & Rosati, Professional Corporation,
counsel to the Company, an opinion in form and substance reasonably satisfactory
to the Purchaser and their counsel.
8.6 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
8.7 PLACEMENT AGENT AGREEMENT. The Company shall have complied with
its obligations under its engagement letter agreement with the Placement Agent.
8.8 COMPLIANCE CERTIFICATE. The Company shall have delivered to each
of the Purchaser a certificate executed on behalf of the Company by its Chief
Executive Officer and dated the Closing Date, certifying to the fulfillment of
the conditions specified in Sections 8.1 and 8.2.
8.9 COMPLIANCE WITH SECURITIES LAWS. The offering, issuance and sale
of the Shares under this Agreement shall have complied with all applicable
requirements of federal securities laws and the Purchaser shall have received
evidence, if any, of such compliance in form and substance satisfactory to the
Purchaser.
8.10 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
contemplated by this Agreement shall be satisfactory to the Purchaser and such
Purchaser's counsel, and the Purchaser and such Purchaser's counsel shall have
received all such counterpart originals or certified or other copies of such
documents as the Purchaser or such Purchaser's counsel may reasonably request.
-14-
<PAGE>
SECTION 9. CONDITIONS TO OBLIGATIONS OF COMPANY. The Company's
obligation to issue and sell the Shares to the Purchaser at the Closing is
subject to the fulfillment on or prior to the Closing Date of the following
conditions, any or all of which may be waived at the option of the Company:
9.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Purchaser in Section 4 hereof shall be true and correct
in all material respects when made, and shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.
9.2 COVENANTS. All covenants, agreements and conditions contained in
this Agreement to be performed by the Purchaser on or prior to the Closing Date
shall have been performed or complied with in all material respects.
9.3 MINIMUM AGGREGATE INVESTMENT. [Deliberately omitted.]
9.4 NO PROHIBITION. There shall not then be in effect any order
enjoining or restraining the transactions contemplated by this Agreement, or any
law, rule or regulation prohibiting or restricting such transactions, or
requiring any consent or approval of any person which shall not have been
obtained (except as otherwise provided in this Agreement).
SECTION 10. PLACEMENT AGENT FEE. The Purchaser acknowledges that the
Company has advised it that the Company intends to pay to the Placement Agent a
fee in respect of this transaction. In addition to and not in limitation of any
other rights hereunder, the Company and the Subsidiaries agree that they will
indemnify and hold harmless the Purchaser from and against any and all claims,
demands or liabilities for broker's, finder's, placement agent's or other
similar fees or commissions and any and all liabilities with respect to any
taxes (including interest and penalties) payable or incurred or alleged to have
been incurred by the Company or any of its Subsidiaries or any person acting or
alleged to have been acting on the Company's or such Subsidiary's behalf, in
connection with this Agreement or the issuance or sale of the Shares; but this
obligation shall not extend to any fees and commissions of any person (other
than the Placement Agent) whose services have been procured by the Purchaser
unless the Company separately acknowledges such obligation in writing.
SECTION 11. NOTICES. All notices, requests, consents and other
communications hereunder shall be in writing and shall be deemed given when sent
both by telecopy/facsimile (unless the addressee has not provided a valid
telecopy/facsimile number for such purpose) and either first class mail, postage
prepaid, or next-day delivery service:
(a) if to the Company, to Genus, Inc., 1139 Karlstad Avenue,
Sunnyvale, CA 94089, Attention: Todd S. Myhre, President, telecopy/facsimile
number (408) 747-7198 with a copy to Wilson, Sonsini, Goodrich & Rosati,
Professional Corporation, 650 Page Mill Road, Palo Alto, CA 94304-1050,
Attention: Steven L. Berson, telecopy/facsimile number (415) 496-
-15-
<PAGE>
4088, or to such other person at such other place as the Company shall designate
to the Purchaser in writing;
(b) if to the Purchaser, at its telecopy/facsimile number and address
as set forth on the signature page to this Agreement, or at such other
telecopy/facsimile number and address as may have been furnished to the Company
in writing; or
(c) if to any transferee or transferees of the Purchaser, at such
telecopy/facsimile number and address as shall have been furnished by such
transferee or transferees to the Company in writing.
SECTION 12. ENTIRE AGREEMENT. This Agreement embodies the entire
agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
SECTION 13. AMENDMENTS. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Company and by
the Purchaser.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
-16-
<PAGE>
SECTION 14. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be part of this Agreement.
SECTION 15. SEVERABILITY. In case any provision contained in this
Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 16. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California (without regard
to conflict of laws principles) and the United States of America.
SECTION 17. COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument, and shall become
effective when one or more counterparts have been signed by each party hereto
and delivered to the other party.
SECTION 18. EXPENSES. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in connection with this Agreement and the transactions
contemplated hereby whether or not the transactions contemplated hereby are
consummated; provided, however, if the Closing is effected, the Company shall,
upon receipt of a bill therefor, reimburse the reasonable fees of special
counsel for the Purchaser, not to exceed $10,000.
SECTION 19. PUBLICITY. The Purchaser shall not issue any press
releases or otherwise make any public statement with respect to the transactions
contemplated by this Agreement without the prior written consent of the Company,
except as may be required by applicable law or regulation.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives the day and year first above
written.
GENUS, INC.
By ______________________________
Its _____________________________
-17-
<PAGE>
PURCHASER
Name of Purchaser: BACHOW INVESTMENT PARTNERS, III, L.P.
Name of Individual
representing Purchaser: Paul S. Bachow
Title of Individual
representing Purchaser: President of Bala Equity, Inc., general
partner of Bala Equity Partners, L.P.,
general partner of Bachow Investment
Partners, III, L.P.
Signature by: BACHOW INVESTMENT PARTNERS, III, L.P.
By: Bala Equity Partners, L.P., its
general partner
By: Bala Equity, Inc., its general
partner
By:/s/ Paul S. Bachow
------------------------------
Paul S. Bachow, President
Address: 3 Bala Plaza East
Suite 502
Bala Cynwyd, PA 19004
Telephone: (610) 660-4900
Facsimile: (610) 660-4930
AGGREGATE PURCHASE PRICE: $6,700,000.00
NAME IN WHICH SHARES ARE
TO BE REGISTERED: BACHOW INVESTMENT PARTNERS, III, L.P.
-18-
<PAGE>
PURCHASER
Name of Purchaser: PAUL S. BACHOW CO-INVESTMENT FUND, L.P.
Name of Individual
representing Purchaser: Paul S. Bachow
Title of Individual
representing Purchaser: President of Bachow Co-Investment, Inc.
general partner of Bachow Co-Investment,
L.P., general partner of Paul S. Bachow
Co-Investment Fund, L.P.
Signature by: PAUL S. BACHOW CO-INVESTMENT FUND, L.P.
By: Bachow Co-Investment Fund, L.P., its
general partner
By: Bachow Co-Investment, Inc., its
general partner
By:/s/ Paul S. Bachow
------------------------------
Paul S. Bachow, President
Address: 3 Bala Plaza East
Suite 502
Bala Cynwyd, PA 19004
Telephone: (610) 660-4900
Facsimile: (610) 660-4930
AGGREGATE PURCHASE PRICE: $892,157.00
NAME IN WHICH SHARES ARE
TO BE REGISTERED: PAUL S. BACHOW CO-INVESTMENT FUND, L.P.
-19-
<PAGE>
PURCHASER
Name of Purchaser: PAUL S. BACHOW
Signature by: /s/ Paul S. Bachow
--------------------------------
Paul S. Bachow
Address: 3 Bala Plaza East
Suite 502
Bala Cynwyd, PA 19004
Telephone: (610) 660-4900
Facsimile: (610) 660-4930
AGGREGATE PURCHASE PRICE: $407,843.00
-----------------------------------
NAME IN WHICH SHARES ARE
TO BE REGISTERED: PAUL S. BACHOW
-20-
<PAGE>
EXHIBIT A
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
To: [Transfer Agent]
The undersigned, the Purchaser or an officer of, or other person duly
authorized by the Purchaser, hereby certifies that
________________________________________________________________________________
[Fill in name of Purchaser]
institution was the Purchaser of the shares evidenced by the attached
certificate, and as such, proposes to transfer such shares on or about
_________________ either (i) in accordance with the registration statement, file
number ___ in which case the Purchaser certifies that the requirement of
delivering a current prospectus has been complied with or will be complied with
in connection with such sale, (ii) in accordance with Rule 144 ("Rule 144")
under the Securities Act of 1933, as amended (the "Securities Act"), in which
case the Purchaser certifies that it has complied with or will comply with the
requirements of Rule 144 or (iii) in accordance with Section 4(1) (or other
applicable exemption) under the Securities Act, in which case the Purchaser
certifies that it has obtained an opinion of counsel stating that such sale is
exempt from the registration and prospectus delivery requirements of the
Securities Act.
Print or type:
Name of Purchaser: ________________________________________
Name of Individual
representing
Purchaser (if an
Institution): ________________________________________
Title of Individual
representing
Purchaser (if an
Institution): ________________________________________
Signature by:
Purchaser or
Individual repre-
senting Purchaser: ________________________________________
<PAGE>
WAIVER
A. Bachow Investment Partners III, L.P., Paul S. Bachow Co-Investment
Fund, L.P., Paul S. Bachow and their nominees (collectively "Bachow") and Genus,
Inc. (the "Company") have entered into a Common Stock Purchase Agreement dated
February 10, 1995 (the "Bachow Stock Purchase Agreement"), pursuant to which
Bachow has agreed to purchase shares of the Common Stock (the "Common Stock") of
the Company with an aggregate purchase price of approximately $8 million (the
"Transaction"); and
B. As of February 8, 1995, the Company had entered into separate Common
Stock Purchase Agreements (the "Other Stock Purchase Agreements") dated such
date with several other purchasers (the "Other Purchasers") covering the sale
and purchase of Common Stock with an aggregate purchase price of approximately
$10 million upon the terms and conditions set forth on the Term Sheet attached
hereto (the "Term Sheet"); and
C. The Company desires to sell and Bachow desires to buy the Common Stock
pursuant to the Bachow Stock Purchase Agreement notwithstanding the fact that
the Company and the Other Purchasers intend to consummate sales and purchases of
the Common Stock on terms that are different from and, in some cases more
favorable than, the terms set forth in the Bachow Stock Purchase Agreement.
For legal and adequate consideration, the receipt of which is hereby
acknowledged, Bachow hereby agrees as follows:
1. Bachow acknowledges that it is aware of all of the material terms and
conditions of the proposed sale of Common Stock by the Company to the Other
Purchasers pursuant to the Other Stock Purchase Agreements.
2. Bachow understands and acknowledges that concurrently with this
Transaction the Company intends to sell and issue to the Other Investors shares
of Common Stock upon the terms and conditions set forth in the Term Sheet.
Date: February 10, 1995
BACHOW INVESTMENT PARTNERS, III, L.P.
By: Bala Equity Partners, L.P., its general partner
By: Bala Equity, Inc., its general partner
By: /s/ Paul S. Bachow
-----------------------------------------
Paul S. Bachow, President
<PAGE>
PAUL S. BACHOW CO-INVESTMENT FUND, L.P.
By: Bachow Co-Investment, L.P., its general partner
By: Bachow Co-Investment, Inc., its general partner
By: /s/ Paul S. Bachow
----------------------------------------------
Paul S. Bachow, President
/s/ Paul S. Bachow
----------------------------------------------
PAUL S. BACHOW
<PAGE>
Exhibit 11.1
GENUS, INC.
Computation of Net Income Per Share (a)
(Amounts in thousands, except per share amounts)
<TABLE>
<CAPTION>
Quarter Ended
March 31,
1995 1994
<S> <C> <C>
Average common shares outstanding 13,725 12,437
Computation of incremental outstanding shares
Net effect of dilutive stock options
based on treasury stock method 854 505
------ ------
14,579 12,942
------ ------
------ ------
Net income $1,938 $ 652
------ ------
------ ------
Net income per share (a) $ 0.13 $ 0.05
------ ------
------ ------
<FN>
Computation Notes:
(a) Presentation of fully diluted earnings per share for the three months
ended March 31, 1995 and 1994 is omitted because such amounts are
materially the same as those presented above.
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FORM THE FIRST QUARTER 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 17,531
<SECURITIES> 0
<RECEIVABLES> 22,203
<ALLOWANCES> 250
<INVENTORY> 17,599
<CURRENT-ASSETS> 57,967
<PP&E> 28,775
<DEPRECIATION> 19,063
<TOTAL-ASSETS> 72,565
<CURRENT-LIABILITIES> 16,592
<BONDS> 0
<COMMON> 92,979
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 72,565
<SALES> 22,526
<TOTAL-REVENUES> 22,526
<CGS> 13,306
<TOTAL-COSTS> 13,306
<OTHER-EXPENSES> 7,194
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 58
<INCOME-PRETAX> 2,084
<INCOME-TAX> 146
<INCOME-CONTINUING> 1,938
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,938
<EPS-PRIMARY> 0.13
<EPS-DILUTED> 0.13
</TABLE>
