Exhibit 10.30
SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT (the "Agreement"), dated as of July 23, 2004,
between Robotic Vision Systems, Inc., a Delaware corporation (the "Company"),
and the subscriber whose name appears on the signature page hereof (the
"Subscriber").
The Company is offering for sale to the Subscriber, on the terms and
conditions set forth below, a number of shares (the "Shares") of the common
stock of the Company, par value $.01 per share (the "Common Stock"), equal to
the total dollar amount listed on the signature page hereof divided by $2.05 per
share (the "Offering Price"), and a warrant (the "Warrant") expiring on July 31,
2007, to acquire 45% of such number of shares of Common Stock (the "Warrant
Shares") at an exercise price of $2.50 per share on or before January 31, 2005,
and $3.05 per share thereafter.
NOW THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereby agree as follows:
I. SUBSCRIPTION FOR SHARES; REPRESENTATIONS BY SUBSCRIBER
1.1 Subject to the terms and conditions hereinafter set forth, the
Subscriber hereby subscribes for and agrees to purchase from the Company, and
the Company agrees to issue and sell to the Subscriber, at the Offering Price,
the Shares and the Warrant. The closing of the purchase of the Shares shall
occur on the date hereof (the "Closing Date"). On the Closing Date, the
Subscriber shall pay the aggregate Offering Price by wire transfer to the
Company in accordance with instructions to be given by the Company to the
Subscriber on or before the Closing Date, the Company shall cause its counsel to
deliver a legal opinion letter in form and substance reasonably acceptable to
the Subscriber, and the parties shall enter into a Registration Rights Agreement
substantially in the form of Exhibit A hereto. The Warrant (in substantially the
form attached hereto as Exhibit B) and certificates evidencing the Shares will
be issued to the Subscriber within five (5) Business Days after receipt and
collection by the Company of payment for the Shares.
1.2 The Subscriber recognizes that the purchase of the Shares and
the Warrant entails elements of risk in that (i) it may not be able to readily
liquidate its investment; (ii) transferability is restricted; and (iii) in the
event of a disposition, it could sustain the loss of its entire investment.
1.3 The Subscriber acknowledges that it is an "Accredited
Investor" as such term is defined in Regulation D under the Securities Act of
1933, as amended (the "Securities Act"), that it has prior investment experience
such that it is able to evaluate the merits and risks of an investment in the
Company, or that it has employed the services of an investment advisor to read
the Disclosure Documents (as hereinafter defined) and to evaluate the merits and
risks of such an investment on its behalf; that it recognizes the speculative
nature of this investment; and that it is able to bear the economic risk it
hereby assumes. The Company's (i) Annual Report on Form 10-K for the year ended
September 30, 2003, as filed with the U.S. Securities and Exchange Commission
("SEC"), and (ii) any other reports filed by the Company with the SEC pursuant
to the Securities Exchange Act of 1934 (the "Exchange Act") between January 13,
2004 and the
date of this Agreement, are collectively referred to as the "Disclosure
Documents." The Subscriber acknowledges that it or its representative(s) have
read the Disclosure Documents. The Subscriber also acknowledges that it and its
representative(s) have been afforded the opportunity to make, and has made, all
inquiries as it and its representatives deemed appropriate with respect to the
Company's affairs and prospects.
1.4 The Subscriber hereby acknowledges that the Offering has not
been reviewed by the SEC because of the Company's representation that it is
intended to be a non-public offering pursuant to Section 4(2) of the Securities
Act. The Subscriber represents that the Shares are being purchased for its own
account, for investment and not for public distribution. The Subscriber
understands that the Shares, upon their issuance, will not be registered under
the Securities Act and may be required to be held indefinitely unless they are
subsequently registered under the Securities Act, or an exemption from such
registration is available.
1.5 The Subscriber acknowledges that the certificates representing
the shares of Common Stock issued hereunder or on exercise of the Warrants and
Additional Warrants shall bear a legend in substantially the following form:
"This security has not been registered under the Securities
Act of 1933, as amended (the "Securities Act"). The holder
hereof, by purchasing this security, agrees for the benefit of
Robotic Vision Systems, Inc. that this security may be resold,
pledged or otherwise transferred only pursuant to an effective
registration statement under the Securities Act or exemption
therefrom, in each case in accordance with any applicable
securities laws of any state of the United States. This
security may be pledged, but not transferred in violation of
the foregoing, in connection with a bona fide margin account
or other loan secured by such securities."
Such legend shall cease to be required: (i) following any sale of such shares
pursuant to the Registration Statement, or (ii) following any sale of such
shares pursuant to Rule 144, or (iii) while such shares are eligible for sale
under Rule 144(k), (iv) while the Registration Statement covering such Shares is
effective under the Securities Act or (v) if such legend is not required under
applicable requirements of the Securities Act. At such time as a legend is no
longer required under this Section, the Company will, as promptly as practicable
following the delivery by the Subscriber to the Company or the Company's
transfer agent of a certificate representing shares containing a restrictive
legend, deliver or cause to be delivered to the Subscriber a certificate
representing such shares that is free from all such legends. If the Company
fails to deliver or cause to be delivered to the Subscriber a certificate
representing such shares that is free from all such legends within seven (7)
Business Days following the delivery by the Subscriber to the Company or the
Company's transfer agent of a certificate representing shares containing a
restrictive legend, the Company shall pay to the Subscriber, as liquidated
damages and not as a penalty, in cash, an amount equal to (x) one percent (1%)
of the Offering Price per share, times (y) the total number of shares included
on such certificate, times (z) the number of Business Days from such seventh
(7th) Business Day until the date that the Company delivers such certificate.
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1.6 The Subscriber represents and warrants that as of the Closing
Date neither it nor any of its affiliates has a "short" position in the Common
Stock.
II. REPRESENTATION AND WARRANTIES BY THE COMPANY
The Company represents and warrants to the Subscriber as follows:
2.1 The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. The Company has
the corporate power and authority to own, lease and operate its properties and
to conduct the business which it presently conducts. The Company is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, except for such
jurisdictions where the failure to be so qualified or in good standing would not
have a material adverse effect on the condition, financial or otherwise, or on
the results of operations, business affairs or business prospects of the
Company.
2.2 The execution, delivery and performance of this Agreement by
the Company (a) has been duly authorized and approved by the Board of Directors
of the Company and all other necessary corporate action on the part of the
Company in connection therewith has been taken and (b) will not conflict with or
constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company pursuant to (i) the charter documents or by-laws of the Company, (ii)
any material contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which the Company is a party or by which it may be
bound or to which any of its properties may be subject or (iii) any law,
administrative regulation or court decree applicable to or binding upon the
Company. This Agreement has been duly and validly executed and delivered by the
Company and constitutes the legal, valid and binding agreement of the Company,
enforceable in accordance with its terms, except that (i) any enforcement may be
subject to bankruptcy, insolvency, reorganization, moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally and
(ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceedings therefor may be brought.
2.3 The Shares shall, upon the consummation of the transactions
contemplated hereby and the payment of the purchase price therefore, be duly and
validly authorized and issued, fully paid and non-assessable and not subject to
any preemptive rights. The Company has reserved from its duly authorized capital
stock the maximum number of shares of Common Stock necessary in order to issue
the Shares, the Additional Shares and the shares of Common Stock issuable upon
exercise of the Warrants and the Additional Warrants.
2.4 The Disclosure Documents are true, correct and complete in all
material respects, and do not contain an untrue statement of material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
2.5 The Company shall use the proceeds from the sale of the Common
Shares hereunder for general working capital purposes.
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2.6 Since the respective dates as of which information was given
in the Disclosure Documents, except as otherwise stated therein: (i) there has
been no material adverse change in the financial condition, or in the results of
operations, affairs or prospects of the Company, whether or not arising in the
ordinary course of business; and (ii) there have been no transactions entered
into by the Company, other than those in the ordinary course of business, which
are material to the Company.
2.7 Except as set forth on Schedule 2.7 hereto, there are no
outstanding rights (either pre-emptive or other) or options to subscribe for or
purchase from the Company, or any warrants or other agreements providing for or
requiring the issuance or purchase by the Company of, any shares of Common
Stock, or any obligations or securities convertible into or exchangeable, for,
or exercisable into, Common Stock, or any voting trusts, proxies, agreements or
understandings relating to the voting of the Common Stock nor any restrictions
on the transferability or sale of such shares or other equity or member
interests except under the Securities Act, and state "blue sky" or securities
laws.
2.8 Except as set forth in Schedule 2.8 hereto, in the past three
years, the Company has timely filed all documents required to be filed with the
SEC pursuant to the Exchange Act and the rules and regulations thereunder, and
all such documents, when so filed, complied as to form in all material respects
with the Exchange Act.
2.9 The Company maintains insurance with respect to property and
risks of a character usually maintained by corporations in the same or similar
business similarly situated, against loss, damage and liability of the kinds and
in the amounts customarily maintained by such corporations, including director
and officer liability insurance.
2.10 The Company is not, and is not an affiliate of, an "investment
company" within the meaning of the Investment Company Act of 1940, as amended.
2.11 Except as set forth in Schedule 2.11 hereto or as disclosed in
the Disclosure Documents, the Company is not a party to any suit, claim, action,
proceeding or investigation which is reasonably likely to have a Material
Adverse Effect or which concerns this Agreement and the transactions
contemplated hereby nor is any such suit, claim, action, proceeding or
investigation pending or, to the knowledge of the Company, threatened in writing
by or against the Company.
2.12 Except as set forth in Schedule 2.12 hereto, no brokerage or
finder's fees or commissions are or will be payable by the Company to any
broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by
this Agreement.
2.13 Except as set forth in Schedule 2.13 hereto, no Person has any
right to cause the Company to effect the registration under the Securities Act
of any securities of the Company.
2.14 The Company understands and confirms that the Subscriber will
rely on the foregoing representations and covenants in effecting transactions in
securities of the Company.
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III. COVENANTS OF THE COMPANY
3.1 Not later than 5:30 P.M., New York time, on the next Business
Day after the Closing Date, the Company will issue a press release disclosing
the transactions contemplated hereby and any other similar transactions
occurring on or about the Closing Date and, as promptly as possible thereafter,
file such press release in a Current Report on Form 8-K with the SEC. The
Subscriber agrees that, prior to the issuance of such press release by the
Company, it shall not make any public announcement or other disclosure regarding
the transactions contemplated hereby without the prior consent of the Company.
3.2 The Company covenants and agrees that, after the date hereof,
neither it nor any other person acting on its behalf will provide any Purchaser
or its agents or counsel with any information that the Company believes
constitutes material non-public information, unless prior thereto such Purchaser
shall have executed a written agreement regarding the confidentiality and use of
such information; provided that the Company may issue a Pre-Notice and
Subsequent Financing Notice as provided in Section 4.2 hereof. The Company
understands and confirms that each Purchaser shall be relying on the foregoing
representations in effecting transactions in securities of the Company
3.3 The Company covenants and agrees that until the earlier of the
effective date of the Registration Statement or sixty (60) days following the
Closing Date, it shall not make any offer for the sale of equity securities or
securities convertible into equity securities; provided, however, this Section
shall not restrict the offer or sale of (a) any securities issued or sold in
connection with the refinancing, replacement, increase or amendment of the
Company's credit line with PNC Bank, National Association and/or RVSI Investors,
L.L.C., (b) the grant of stock options to any director, officer or consultant of
the Company in connection with services rendered to the Company, (c) any shares
issued upon the exercise of any stock options, warrants or other convertible
securities, (c) any securities issued in connection with the satisfaction of
trade debt or other obligations of the Company, or (d) the issuance of shares
pursuant to Section 4.3 hereof or any pursuant to rights of other investors in
the Company similar to those provided by Section 4.3 hereof.
3.4 The Company hereby agrees to indemnify, exonerate and hold the
Subscriber and its (if applicable) controlling persons and their respective
shareholders, officers, directors, employees and agents free and harmless from
and against any and all losses, damages, costs, expenses and liabilities
(including reasonable attorney's fees and disbursements) (collectively,
"Damages"), directly or indirectly resulting from, based upon or arising out of
(i) any breach of any representation or warranty made by the Company contained
in this Agreement or any other agreement, document or certificate annexed hereto
or delivered to Purchaser pursuant hereto or (ii) any breach of any covenant
made by the Company under this Agreement or any other agreement delivered to
Purchaser pursuant hereto, except where such Damages are caused by the actions
of the Subscriber, as indemnitee, in violation of its obligations under such
agreements.
IV. ANTI-DILUTION; ADDITIONAL SUBSCRIPTION RIGHTS
4.1 If, during the period ending on the date that the Registration
Statement has been effective for an aggregate of twelve (12) months, the Company
(a) issues Common Stock for a
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price per share less than the Offering Price (a "Lesser Price"), (b) issues
securities convertible into Common Stock where the consideration for such
securities plus the exercise price thereof is a Lesser Price, or (c) amends the
terms of existing convertible securities so that the exercise price thereof is a
Lesser Price, the Company shall issue additional shares of Common Stock to the
Subscriber such that the Subscriber shall have received an aggregate number of
shares of Common Stock equal to the amount paid by such Subscriber pursuant to
Section 1.1 divided by such Lesser Price. In consideration for such issuance,
the Subscriber shall pay to the Company the par value of any shares so issued
pursuant to this Section. The obligations of the Company pursuant to this
Section shall not be triggered by (a) any securities issued or sold in
connection with the refinancing, replacement, increase or amendment of the
Company's credit line with PNC Bank, National Association and/or RVSI Investors,
L.L.C., (b) any shares issued upon the exercise of any stock options, warrants
or other convertible securities, (c) any securities issued in connection with
the satisfaction of trade debt or other obligations of the Company, or (d) the
issuance of shares pursuant to Section 4.3 hereof or any pursuant to rights of
other investors in the Company similar to those provided by Section 4.3 hereof.
4.2 If, during the period ending on the date that the Registration
Statement has been effective for an aggregate of twelve (12) months, the Company
offers additional equity for sale (a "Subsequent Financing"), the Company shall
offer to sell to the Subscribers, in proportion to the shares of Common Stock
sold to them at the Closing Date, an aggregate number of shares equal to 50% of
the shares proposed to be sold to other potential offerees in such offering, on
substantially similar terms as the Company may, in its discretion, offer to
other potential offerees. At least five (5) trading days prior to the closing of
the Subsequent Financing, the Company shall deliver to each Subscriber a written
notice of its intention to effect a Subsequent Financing ("Pre-Notice"), which
Pre-Notice shall ask such Subscriber if it wants to review the details of such
financing (such additional notice, a "Subsequent Financing Notice"). Upon the
request of a Subscriber, and only upon a request by such Subscriber, for a
Subsequent Financing Notice, the Company shall promptly, but no later than one
(1) trading day after such request, deliver a Subsequent Financing Notice to
such Subscriber. The Subsequent Financing Notice shall describe in reasonable
detail the proposed terms of such Subsequent Financing, the amount of proceeds
intended to be raised thereunder, and attached to which shall be a term sheet or
similar document relating thereto. If the Company receives no notice from a
Subscriber as of such 5th trading day, such Subscriber shall be deemed to have
notified the Company that it does not elect to participate. The Company must
provide the Subscribers with a second Subsequent Financing Notice, and the
Subscribers will again have the right of participation set forth above in this
Section 4.2, if the Subsequent Financing subject to the initial Subsequent
Financing Notice is not consummated for any reason on the terms set forth in
such Subsequent Financing Notice within sixty (60) trading days after the date
of the initial Subsequent Financing Notice. The obligations of the Company
pursuant to this Section 4.2 shall not be triggered by (a) any securities issued
or sold in connection with the refinancing, replacement increase or amendment of
the Company's credit line with PNC Bank, National Association and/or RVSI
Investors, L.L.C., (b) any shares issued upon the exercise of any stock options,
warrants or other convertible securities, (c) any securities issued in
connection with the satisfaction of trade debt or other obligations of the
Company, (d) the issuance of shares pursuant to Section 4.3 hereof or any
pursuant to rights of other investors in the Company similar to those provided
by Section 4.3 hereof, or (e) any shares issued in connection with rights of
other investors in the Company similar to those provided by this Section 4.2.
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4.3 During the period ending thirty (30) days after the
Registration Statement covering the Common Stock issued at the Closing Date
becomes effective, the Subscriber shall have the right (but not the obligation)
to purchase (i) up to 25% of the number of shares subscribed for at the Closing
Date (the "Additional Shares") at the Offering Price per share specified in
Section 2.1, and (ii) Warrants to purchase a number of shares of Common Stock
equal to 45% of the number of Additional Shares subscriber for pursuant to the
previous clause (the "Additional Warrants"). The Additional Warrants shall have
an expiration date, exercise price and other terms substantially identical to
those of the Warrants issuable pursuant to Section 2.1. The Subscriber shall
give the Company at least one Business Day's notice of its election to purchase
Additional Shares and Additional Warrants, which notice shall state the date of
such purchase and the dollar amount to be invested by the Subscriber. On the
date specified in the notice, the Subscriber shall pay the aggregate Offering
Price for the Additional Shares and Additional Warrants by wire transfer to the
Company in accordance with instructions to be given by the Company to the
Subscriber on or before such date. The Additional Warrants and certificates
evidencing the Additional Shares will be issued to the Subscriber within five
(5) Business Days after receipt and collection by the Company of payment for the
Additional Shares and Additional Warrants. If the Subscriber does not purchase
the full amount of Additional Shares and Additional Warrants to which it is
entitled pursuant to this Section, the Company reserves the right to offer such
Additional Shares and Additional Warrants to other persons entering into
Subscription Agreements substantially similar to this Agreement on or about the
date hereof.
V. DEFINITIONS
5.1 For purposes of this Agreement, the following terms shall have
the meanings set forth below:
"Business Day" means any day other than a Saturday or Sunday or a legal
holiday on which commercial banks are authorized or required by law to be closed
for business in New York, New York.
"Material Adverse Effect" means (a) an adverse effect on the validity
or enforceability of this Agreement in any material respect, (b) a material
adverse effect on the financial condition, business, results of operations or
properties of the Company, except for any change, event or effect to the extent
arising from or relating to (i) general business or economic conditions
(including prevailing interest rate and stock market levels or general market
disruptions), and (ii) the general state of the industries and market sectors in
which the Company operates, or (c) an impairment of the ability of the Company
to fulfill its obligations under this Agreement in any material respect.
"Registration Statement" shall have the meaning provided in the
Registration Right Agreement attached hereto as Exhibit A.
VI. MISCELLANEOUS
6.1 Any notice, request, advice, consent or other communication
given hereunder shall be given in writing and sent by overnight delivery service
or registered or certified mail,
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return receipt requested, and addressed as follows: if to the Company, to it at
000 Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxxxxx 00000, Attention: President; and if to
the Subscriber, to it at its address indicated below its signature to this
Agreement. Notices so given shall be deemed to have been given on the earlier to
occur of actual receipt or three business days after the date of such mailing,
except for notices of change of address, which shall be deemed to have been
given when received.
6.2 This Agreement shall not be changed, modified or amended
except by a writing signed by the parties hereto.
6.3 This Agreement shall be binding upon and inure to the benefit
of the parties hereto and to their respective heirs, legal representatives,
successors and assigns. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any and
every nature among them.
6.4 This Agreement and its validity, construction and performance
shall be governed in all respects by the laws of the State of New York. The
parties hereto hereby consent to the exclusive jurisdiction of the state and
Federal courts sitting in and for New York County, New York, for the purpose of
any suit, action or other proceeding arising out of or in connection with this
Agreement or any of the transactions contemplated hereby.
6.5 This Agreement may be executed in counterparts. The parties
agree that the facsimile signature of any party hereto shall constitute a legal,
valid, and binding execution hereof by such party.
[signatures follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first set forth above.
ROBOTIC VISION SYSTEMS, INC.
By:___________________________
Name:
Title:
ACCEPTED AND AGREED TO:
NAME OF SUBSCRIBER:
By:__________________________
Name:
Title:
Total Dollar Amount of Shares Subscribed for:___________________
__________________________
Address
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