Exhibit 10.33
STOCK TRANSFER AGREEMENT
by and between
Quantum Technologies Worldwide, Inc.
and
General Motors Corporation
Dated
June 12, 2001
CONTENTS
ARTICLE 1 ACQUISITION OF SHARES......................................... 2
1.1 Defined Terms........................................... 2
1.2 Transfer................................................ 2
1.3 Consideration........................................... 3
ARTICLE 2 GM REPRESENTATIONS AND WARRANTIES............................. 4
2.1 Organization; Qualification; Good Standing.............. 4
2.2 Authorization of Agreement.............................. 4
2.3 Securities Representations.............................. 4
2.4 Securities Law Restrictions............................. 6
2.5 Market Stand-Off........................................ 6
2.6 Rights of the Company................................... 6
2.7 Ownership of Securities................................. 6
2.8 Future Acquisitions..................................... 7
ARTICLE 3 TRANSFER OF SHARES............................................ 7
3.1 Right of First Refusal.................................. 7
3.2 Exercise of Right of First Refusal...................... 7
3.3 Transfer of Shares...................................... 8
3.4 Additional Shares or Substituted Securities............. 8
3.5 Termination of Right of First Refusal................... 9
3.6 Termination of Rights as Stockholder.................... 9
3.7 Compliance with IRC Section 355......................... 9
ARTICLE 4 COMPANY REPRESENTATIONS AND WARRANTIES........................ 10
4.1 Organization; Qualification; Good Standing.............. 10
4.2 Capitalization.......................................... 10
4.3 Authorization of Agreement.............................. 11
4.4 Authorization of Shares................................. 11
4.5 Governmental Consents................................... 11
4.6 Title to Property and Assets............................ 11
4.7 Intellectual Property................................... 12
4.8 Offering Valid.......................................... 13
4.9 Litigation.............................................. 13
4.10 Compliance with Laws.................................... 13
4.11 No Defaults............................................. 14
ARTICLE 5 CONDUCT OF THE COMPANY PENDING THE CLOSING.................... 14
ARTICLE 6 CONDITIONS TO CLOSING......................................... 14
6.1 Conditions to Closing by the Company.................... 14
6.2 Conditions to Closing by GM............................. 15
ARTICLE 7 SUCCESSORS AND ASSIGNS........................................ 16
ARTICLE 8 LEGENDS....................................................... 17
ARTICLE 9 NOTICE........................................................ 18
ARTICLE 10 SURVIVAL..................................................... 18
ARTICLE 11 ENTIRE AGREEMENT............................................. 19
ARTICLE 12 CHOICE OF LAW................................................ 19
ARTICLE 13 DEFINITIONS.................................................. 19
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STOCK TRANSFER AGREEMENT
THIS STOCK TRANSFER AGREEMENT (this "Agreement") is entered into on June
12, 2001, by and between QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware
corporation (the "Company"), and GENERAL MOTORS CORPORATION, a Delaware
corporation ("GM").
RECITALS
A. This Agreement is one of several agreements to be entered into by the
Company and GM concurrently, which additional agreements include that certain
Corporate Alliance Agreement (the "Alliance Agreement"), that certain Master
Technical Development Agreement (the "Development Agreement") and that certain
Registration Rights Agreement (the "Registration Rights Agreement"). The
Alliance Agreement, the Development Agreement and the Registration Rights
Agreement shall sometimes be referred to herein collectively as the
"Transactional Agreements."
B. This Agreement and each of the Transactional Agreements shall be
effective as of the date of the Closing (as hereinafter defined).
C. Following the execution of this Agreement and the Transactional
Agreements and prior to the Closing, IMPCO Technologies Inc., a Delaware
corporation and the parent of the Company ("IMPCO"), and the Company, intend to
effectuate a tax-free distribution of the Company (the "Spin-Off") in full
compliance with all of the requirements of Section 355 (including Section
355(e)) of the Internal Revenue Code of 1986, as amended ("IRC"). The Company
and GM hereby acknowledge that the terms set forth in this Agreement and the
Transactional Agreements and the transactions contemplated hereby and thereby
are intended in their application to meet the requirements of IRC Section 355
(and Section 355(e)) and hereby agree to cooperate with one another and to
conduct the transactions contemplated herein and therein in such a manner as to
achieve that objective.
D. The Company intends to effect the Spin-Off in contemplation of
conducting an initial public offering of the Company's securities to the general
public ("IPO") pursuant to a registration statement to be filed under the
Securities Act in connection with or following the date of the Spin-Off.
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE 1
ACQUISITION OF SHARES
1.1 Defined Terms.
Capitalized terms not specifically defined herein (including in
Article 13 hereof) are as defined in the Development Agreement.
1.2 Transfer.
(a) On the terms and conditions set forth in this Agreement, the
Company agrees to transfer to GM, and GM agrees to acquire, at the Closing, that
number of shares of the Company's Series A Common Stock, $0.001 par value per
share (the "Acquired Shares"), which, when combined with all shares of capital
stock of the Company then issued and outstanding, shall equal twenty percent
(20%) of the issued and outstanding shares of capital stock of the Company.
(b) The Acquired Shares shall have the rights, privileges and
restrictions as set forth in the Restated Certificate of Incorporation, a copy
of which is attached hereto as Exhibit "A" (the "Certificate"), which the
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Company will, prior to the Closing, adopt and file with the Secretary of State
of the state of Delaware. Such rights, privileges and restrictions shall
specifically provide for anti-dilution protection whereby the number of Acquired
Shares transferred hereunder shall automatically adjust to equal twenty percent
(20%) of the issued and outstanding shares of capital stock of the Company
through the closing of the IPO whereupon it shall convert to Common Stock. The
Board of Directors shall reserve a sufficient number of authorized shares of its
Common Stock for issuance upon conversion of the Acquired Shares. Except for
having such additional rights, privileges and preferences as set forth in the
Certificate, the Acquired Shares shall be treated in this Agreement in the same
manner as, and be considered as constituting, shares of the Company's ordinary
Common Stock.
(c) The transfer of the Acquired Shares shall take place immediately
following the effectiveness of the Spin-Off at the offices of the Company or at
such other location as the Company and GM shall agree (the "Closing"). At the
Closing, each of the Company and GM shall take such action and deliver all such
funds, documents, certificates and other items as may be required, under this
Agreement or otherwise, in order to perform or fulfill all covenants,
conditions, and agreements on its part to be performed or fulfilled at or before
the Closing.
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1.3 Consideration.
The consideration to be paid by GM for the Acquired Shares shall be
substantially as described in and limited by the Alliance Agreement and the
Development Agreement, and consist of the following:
(a) Cash. In addition to such other consideration as is set forth in
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this Section 1.3, GM shall pay to the Company at the Closing such amount of cash
as is equal to the aggregate par value of the Acquired Shares.
(b) Support. GM shall actively support the Company in the performance
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of the Company's duties under the Alliance Agreement and the Development
Agreement and all other agreements related thereto by providing the following to
the Company:
1. Access to GM industry expertise;
2. Introductions to significant individuals in the industry; and
3. Introductions to GM customer base for the GM Fuel Cell
Systems.
(c) Endorsement. GM shall publicly endorse the Company by using
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reasonable efforts to introduce and recommend the Company as a source of the
business, and as a recommended partner for the design and supply of gaseous
storage and handling systems and sub-systems, as appropriate.
(d) Directed Research and Development. GM shall use its expertise and
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knowledge of the relevant markets to direct such research and development to be
performed by the Company as shall be determined appropriate to enhance the
relevant business and speed its commercialization in transportation, mobile,
stationary, portable and infrastructure applications, particularly in the areas
of advanced gaseous storage, handling, control and integration with Fuel Cell
Systems.
(e) Guidance. As part of the collaborative efforts of the parties to
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this Agreement, GM shall provide the Company with guidance in the following
areas, among others, to enhance resource and skill sets:
1. The evaluation of future technology, testing procedures and
general marketing proposals;
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2. Fuel Cell System requirements for steady state and transient
operation, and the gaseous storage and handling interface and performance
targets to satisfy those requirements;
3. The evaluation of resource and facility needs; and
4. The coordination of personnel and research and development,
which may include the sharing or exchange of staff and resources.
(f) Licenses. GM shall provide the Company with appropriate
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foreground and background technology licenses necessary for the Company to
distribute Quantum Products.
ARTICLE 2
GM REPRESENTATIONS AND WARRANTIES
GM hereby represents and warrants the following:
2.1 Organization; Qualification; Good Standing.
GM is a corporation duly incorporated, validly existing and in good
standing under the laws of the state of Delaware. GM has all requisite power
and authority to carry on its business as presently conducted, to execute and
deliver this Agreement and to carry out the transactions contemplated herein.
GM is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to be so qualified would have a material
adverse effect on its business or property.
2.2 Authorization of Agreement.
The execution, delivery and performance by GM of this Agreement have
been duly authorized by all requisite action of GM and its Board of Directors.
This Agreement has been duly executed and delivered by GM and constitutes a
valid and binding obligation of GM, enforceable against GM in accordance with
its terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance and other laws of general
application affecting enforcement of creditors' rights generally, and (ii) as
limited by laws relating to the availability of specific performance, injunctive
relief or other equitable remedies.
2.3 Securities Representations.
In connection with the issuance and acquisition of Acquired Shares
under this Agreement, GM hereby represents and warrants to the Company as
follows:
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(a) GM is an "accredited investor" within the meaning of SEC Rule
501 of Regulation D, as presently in effect.
(b) GM is acquiring and will hold the Acquired Shares for investment
for its account only and not with a view to, or for resale in connection with,
any "distribution" thereof within the meaning of the Securities Act.
(c) GM understands that the Acquired Shares have not been registered
under the Securities Act by reason of a specific exemption therefrom and that
the Acquired Shares must be held indefinitely, unless they are subsequently
registered under the Securities Act or GM obtains an opinion of counsel, in form
and substance satisfactory to the Company and its counsel, that such
registration is not required. GM further acknowledges and understands that the
Company is under no obligation to register the Acquired Shares, except as the
parties hereto may expressly agree in that certain Registration Rights Agreement
of even date herewith attached hereto as Exhibit "B" or otherwise.
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(d) GM will not sell, transfer or otherwise dispose of the Acquired
Shares in violation of the Securities Act, the Exchange Act, or the rules
promulgated thereunder, including Rule 144 under the Securities Act. GM agrees
that it will not dispose of the Acquired Shares unless and until it has complied
with all requirements of this Agreement applicable to the disposition of
Acquired Shares and it has provided the Company with written assurances, in
substance and form satisfactory to the Company, that (1) the proposed
disposition does not require registration of the Acquired Shares under the
Securities Act or all appropriate action necessary for compliance with the
registration requirements of the Securities Act or with any exemption from
registration available under the Securities Act (including Rule 144) has been
taken and (2) the proposed disposition will not result in the contravention of
any transfer restrictions applicable to the Acquired Shares under the securities
laws of any state or the rules promulgated thereunder.
(e) The Company, a wholly-owned subsidiary of IMPCO, formerly
conducted its business as an operating segment of IMPCO known as the Automotive
OEM Division. GM acknowledges and agrees that IMPCO's existing periodic filings
pursuant to the Exchange Act historically discussed the Company as a separate
segment of IMPCO and provided certain information about the business activities
that are now being conducted by the Company. GM acknowledges that it has been
furnished with, and has had access to, such information as it considers
necessary or appropriate for deciding whether to invest in the Acquired Shares,
and GM has had an opportunity to ask questions and receive answers from the
Company regarding the terms and conditions of the issuance of the Acquired
Shares.
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(f) GM is aware that its investment in the Company is a speculative
investment that has limited liquidity and is subject to the risk of complete
loss. GM is able, without impairing its financial condition, to hold the
Acquired Shares for an indefinite period and to suffer a complete loss of its
investment in the Acquired Shares.
2.4 Securities Law Restrictions.
Regardless of whether the offering and transfer of Acquired Shares under
this Agreement have been registered under the Securities Act or have been
registered or qualified under the securities laws of any state, the Company at
its discretion may impose restrictions upon the sale, pledge or other transfer
of the Acquired Shares (including the placement of appropriate legends on stock
certificates or the imposition of stop-transfer instructions) if, in the
judgment of the Company, such restrictions are necessary or desirable in order
to achieve compliance with the Securities Act, the securities laws of any state
or any other law.
2.5 Market Stand-Off.
GM agrees that it shall not, to the extent requested by the Company
and an underwriter of Common Stock (or other securities) of the Company, sell or
otherwise transfer or dispose (other than to donees who agree to be similarly
bound) any Common Stock (or other securities) of the Company for one hundred
eighty (180) days following the effective date of a registration statement of
the Company filed under the Securities Act in connection with the IPO, and for
ninety (90) days following the effective dates of each of the first two (2)
registrations thereafter, provided that such registrations become effective
within three years of such closing date. To enforce the agreement contained in
this Section 2.5, the Company may impose stop-transfer instructions with respect
to Common Stock held by GM until the end of such periods. The Company's
underwriters shall be beneficiaries of the agreement set forth in this Section
2.5.
2.6 Rights of the Company.
The Company shall not be required to (a) transfer on its books any Acquired
Shares that have been sold or transferred in contravention of this Agreement or
(b) treat as the owner of Acquired Shares, or otherwise to accord voting,
dividend or liquidation rights to, any transferee to whom Acquired Shares have
been transferred in contravention of this Agreement.
2.7 Ownership of Securities.
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None of GM or its Affiliates own, nor have any option or right to
acquire, directly or indirectly, any capital stock or other securities of IMPCO
or the Company, other than the Acquired Shares, provided that a pension plan or
profit sharing plan that does not buy, sell or vote securities at the order,
direction or recommendation of GM shall not be deemed to be an Affiliate of GM.
2.8 Future Acquisitions.
None of GM or any of its Affiliates has any plan or intention to
acquire, directly or indirectly, any capital stock or other securities of IMPCO
or the Company, other than the Acquired Shares, provided that a pension plan or
profit sharing plan that does not buy, sell or vote securities at the order,
direction or recommendation of GM shall not be deemed to be an Affiliate of GM.
ARTICLE 3
TRANSFER OF SHARES
3.1 Right of First Refusal.
In the event that GM proposes to sell, assign, pledge, transfer or
otherwise convey ("Transfer") any Acquired Shares or other similar evidence of
equity ownership or interest in the Company (collectively, the "Offered
Shares"), to a third party not affiliated with GM in one or more related bona
fide arms-length transactions (a "Transaction"), then GM and/or its assignee(s)
shall offer in writing to the Company the right to purchase the Offered Shares
on the same terms and conditions (subject, however, to any change of terms
permitted under Section 3.3 below) as set forth in such written notice (the
"Transfer Notice"). The Transfer Notice shall include (i) a description of the
Offered Shares, (i) the identity of the prospective transferee(s), (iii) the
consideration and the material terms and conditions upon which the proposed
Transfer is to be made and (iv) the expected closing date for the Transaction.
The Transfer Notice shall also include a copy of any written proposal, term
sheet or letter of intent or other agreement relating to the proposed Transfer,
and GM shall certify that it has a good faith belief that a binding agreement
for the Transfer is obtainable on the terms described in, or attached to, the
Transfer Notice.
3.2 Exercise of Right of First Refusal.
Within thirty (30) calendar days after the date of receipt of the
Transfer Notice, the Company may notify GM in writing of the Company's desire to
purchase from GM all, but not less than all, of the Offered Shares at the same
price, and upon the same terms (or terms as similar as reasonably possible) as
described in the
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Transfer Notice, and GM shall sell the Offered Shares to the Company pursuant to
such terms.
3.3 Transfer of Shares.
If the Company and/or its assignee(s) fail to exercise their Right of
First Refusal to purchase all, but not less than all, of the Offered Shares
within thirty (30) calendar days after the date of receipt of the Transfer
Notice, GM may, not later than ninety (90) calendar days following receipt of
the Transfer Notice by the Company, conclude a transfer of the Offered Shares
subject to the Transfer Notice on the terms and conditions described in the
Transfer Notice, provided that any such sale is made in compliance with
applicable federal and state securities laws and not in violation of any other
contractual restrictions to which GM is bound, and provided further, that the
Transferee agrees, prior to such transfer, to receive and hold the Offered
Shares subject in all respects to the provisions of this Agreement. Any
proposed transfer on terms and conditions materially different from those
described in the Transfer Notice, as well as any subsequent proposed transfer by
GM, shall again be subject to the Right of First Refusal and shall require
compliance with the procedure described in Section 3.1 above. If the Company
and/or its assignee(s) exercise the Right of First Refusal and purchase all of
the Offered Shares, the parties shall consummate the sale of the Offered Shares
on the terms set forth in the Transfer Notice within sixty (60) calendar days
after the date when the Company received the Transfer Notice (or within such
longer period as may have been specified in the Transfer Notice); provided,
however, that in the event the Transfer Notice provided that payment for the
Offered Shares was to be made in a form other than cash or cash equivalents paid
at the time of transfer, the Company or its assignee(s) shall have the option of
paying for the Offered Shares with cash or cash equivalents equal to the Fair
Market Value of the consideration described in the Transfer Notice.
3.4 Additional Shares or Substituted Securities.
In the event of the declaration of a stock dividend, the declaration
of an extraordinary dividend payable in a form other than stock, a spin-off, a
stock split, an adjustment in conversion ratio, a recapitalization or a similar
transaction affecting the Company's outstanding securities without receipt of
consideration, any new, substituted or additional securities or other property
(including money paid other than as an ordinary cash dividend) which are by
reason of such transaction distributed with respect to any Acquired Shares
subject to this Article 3 or into which such Acquired Shares thereby become
convertible shall immediately be subject to this Article 3 and shall, for all
purposes of this Agreement, be considered as Acquired Shares.
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Appropriate adjustments to reflect the distribution of such securities or
property shall be made to the number and/or class of Acquired Shares subject to
this Article 3.
3.5 Termination of Right of First Refusal.
The Right of First Refusal shall terminate and be of no force and
effect immediately upon the earliest to occur of (a) the first date on which the
Company's Common Stock is held of record by more than five hundred (500)
persons, (b) a determination is made by the Board of Directors that a public
market exists for the outstanding Acquired Shares, or (c) the effective date of
a firm commitment underwritten public offering, pursuant to an effective
registration statement on Form S-1 or Form SB-2 under the Securities Act,
covering the offer and sale of the Company's Common Stock. Notwithstanding the
foregoing language contained in this Section 3.5, the Right of First Refusal
shall continue for a period of three (3) years following the date of this
Agreement with respect to any negotiated transaction between GM and any other
Person. The effectiveness of the Market Stand-Off set forth in Section 2.5
shall not be affected by the termination of this Right of First Refusal.
3.6 Termination of Rights as Stockholder.
If the Company or its assignee(s) make available, at the time and
place and in the amount and form provided in this Agreement, the consideration
for the Offered Shares to be Acquired in accordance with Section 3.3 above, then
after such time the person from whom such Offered Shares are to be Acquired
shall no longer have any rights as a holder of such Offered Shares (other than
the right to receive payment of such consideration in accordance with this
Agreement). Such Offered Shares shall be deemed to have been Acquired in
accordance with the applicable provisions hereof, whether or not the
certificate(s) therefor have been delivered as required by this Agreement. In
the event such certificate(s) are not delivered as required hereunder, GM hereby
irrevocably constitutes and appoints any duly elected secretary of the Company
to transfer the Offered Shares on the books of the Company with full power of
substitution.
3.7 Compliance with IRC Section 355.
None of GM or its Affiliates shall take or fail to take any action
that could cause or reasonably be expected to contribute to the failure of the
Spin-Off to qualify under IRC Section 355 or that could cause or reasonably be
expected to cause the provisions of IRC Section 355(e) to apply to those
transactions.
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ARTICLE 4
COMPANY REPRESENTATIONS AND WARRANTIES
Except as set forth in Exhibit "C" attached hereto and except as affected
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by the transactions contemplated hereby, the Company hereby represents and
warrants the following:
4.1 Organization; Qualification; Good Standing.
The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the state of Delaware. The Company has all
requisite corporate power and authority to carry on its business as presently
conducted, to execute and deliver this Agreement and to carry out the
transactions contemplated herein. The Company is duly qualified to transact
business and is in good standing in each jurisdiction in which the failure to be
so qualified would have a material adverse effect on its business or property.
4.2 Capitalization.
The Company is authorized to issue Fifty Million (50,000,000) shares
of capital stock, consisting of:
(a) Thirty-Five Million (35,000,000) shares of common stock, $0.001
par value per share (the "Common Stock"), of which Ten Million (10,000,000)
shares are issued and outstanding; and
(b) Fifteen Million (15,000,000) shares of preferred stock, par
value $0.001 per share (the "Preferred Stock"), none of which are issued and
outstanding. Subject to the limitations set forth in the Company's Certificate
of Incorporation, as amended or corrected to date, the Board of Directors has
the right to create and file the designations, preferences and rights of the
Preferred Stock.
(c) A list of all holders of Common Stock as of the date of this
Agreement, including the number of shares held by each such holder, is attached
as Schedule 4.2(c) to Exhibit "C" hereto.
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(d) Except as set forth in this Agreement and the Exhibits hereto,
there are no outstanding options, warrants, rights (including conversion or
preemptive rights and rights of first refusal or similar rights) or agreements,
orally or in writing, for the purchase or acquisition from the Company of any
shares of its capital stock.
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4.3 Authorization of Agreement.
The execution, delivery and performance by the Company of this
Agreement has been duly authorized by all requisite action of the Company and
its Board of Directors. This Agreement has been duly executed and delivered by
the Company and constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance and other laws of general application affecting
enforcement of creditors' rights generally, and (ii) as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
4.4 Authorization of Shares.
The issuance and delivery of the Acquired Shares at the Closing will
be duly authorized by all requisite action of the Company. When so issued and
delivered, the Acquired Shares will be validly issued and outstanding, fully
paid and nonassessable and, based in part upon the representations of GM herein,
will be issued in compliance with all applicable federal and state securities
laws, and will be free of restrictions on transfer other than restrictions on
transfer contemplated by this Agreement and under applicable state and federal
securities laws.
4.5 Governmental Consents.
No consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any federal, state,
local or provincial governmental authority on the part of the Company is
required in connection with the consummation of the transactions contemplated by
this Agreement, except for compliance with the requirements of the HSR Act, if
applicable, and any notices of sale required to be filed with the SEC under
Regulation D of the Securities Act or such post-closing filings as may be
required pursuant to applicable state securities laws, which filings will be
effected within the applicable periods therefor following the Closing.
4.6 Title to Property and Assets.
The Company owns its property and assets free and clear of all
mortgages, liens, loans and encumbrances, except such mortgages, liens, loans
and encumbrances which arise in the ordinary course of business and do not
materially impair the Company's ownership or use of such property or assets.
With respect to the property and assets it leases, the Company is in material
compliance with such leases and, to its knowledge, holds a valid leasehold
interest free of any liens, claims
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or encumbrances. All facilities, equipment, fixtures, vehicles and other
properties owned, leased or used by the Company are in good operating condition
and repair and are reasonably fit and usable for the purposes for which they are
being used.
4.7 Intellectual Property.
(a) To the best of its knowledge with respect to patents,
trademarks, service marks and trade names only (without having conducted any
special investigation or patent or trademark search), the Company owns or
possesses sufficient rights to all patents, patent applications, trade names,
trademarks, trademark applications, trade dress, service marks, copyright, trade
secrets, information, proprietary rights and processes ("Intellectual Property")
necessary for its business as it has historically been conducted as the
Automotive OEM Division of IMPCO as further described in Section 2.3(e) hereof
without any material conflict with, or infringement of, the rights of others.
The Company has not received any communications alleging that the Company is
violating or, by conducting its business as proposed, would materially violate
any of the Intellectual Property of any other person or entity.
(b) To the Company's knowledge none of its employees, officers or
consultants is obligated under any contract (including licenses, covenants or
commitments of any nature) or other agreement, or subject to any judgment,
decree or order of any court or administrative agency, that would interfere with
the use of such employee's, officer's or consultant's best efforts to promote
the interests of the Company or that would conflict with the Company's business.
Neither the execution nor delivery of this Agreement nor the carrying on of the
Company's business by the employees and officers of and consultants to the
Company will, to the Company's knowledge, conflict with or result in a breach of
the terms, conditions or provisions of, or constitute a material default under,
any contract, covenant or instrument under which any of such employees, officers
or consultants is now obligated.
(c) Each of the Company's former and current employees, officers and
consultants has entered into an Inventions and Confidential Information
Agreement in substantially the forms attached hereto as Exhibit "D."
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"Inventions" means all inventions, developments and discoveries which during the
period of an individual's service to the Company he or she makes or conceives
of, either solely or jointly with others, that relate to any subject matter with
which his or her work for the Company may be concerned, or relate to or are
connected with the business, products, services or projects of the Company, or
relate to the actual or demonstrably anticipated research or development of the
Company or involve the use of the Company's funds,
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time, material, facilities or trade secret information, except as excluded
pursuant to applicable law.
(d) For purposes of this Agreement, unless otherwise provided, the
term "knowledge" shall mean the current actual awareness of information about
facts by the officers of the Company based upon their due inquiry.
4.8 Offering Valid.
Assuming the accuracy of the representations and warranties of GM
contained in Article 2 hereof, the offer, sale and issuance of the shares of the
Acquired Shares will be exempt from the registration requirements of the
Securities Act and will have been registered or qualified (or are exempt from
registration and qualification) under the registration, permit or qualification
requirements of applicable state securities laws. Neither the Company nor any
agent on its behalf has solicited or will solicit any offers to purchase or has
offered to sell or will offer to sell all or any part of the shares of Common
Stock to any person or persons so as to bring the sale of such shares by the
Company within the registration provisions of the Securities Act or any state
securities laws.
4.9 Litigation.
Except as disclosed in Schedule 4.9 to Exhibit "C" hereto, there is no
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action, suit, customer claim, proceeding or investigation by or before any
individual, entity, court, governmental instrumentality or other agency pending
or, to the knowledge of the Company, threatened, against the Company which
relates to the Company or its business operations or questions the validity of
this Agreement or the right of the Company to enter into it, or to consummate
the transactions contemplated hereby, that the Company reasonably believes will
have, either individually or in the aggregate, any material adverse effect on
the business, assets, properties, condition or operations of the Company. The
Company is not a party or subject to the provisions of any order, writ,
injunction, judgment or decree of any court or government agency or
instrumentality. Except as described in the above-referenced Schedule, there is
no action, suit, proceeding or investigation by the Company currently pending or
which the Company intends to initiate.
4.10 Compliance with Laws.
The Company is not in violation of any applicable statute, rule,
regulation, order or restriction of any domestic or foreign government or any
instrumentality or agency thereof in respect of the conduct of its business or
the ownership of its properties, which violation would materially and adversely
affect the
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business, assets, liabilities, financial condition, operations or prospects of
the Company.
4.11 No Defaults.
To the knowledge of the Company, there presently exists no material
default under any material contract, agreement or instrument to which the
Company is a party or by which it or any of its property is bound or affected
and there presently exists no condition, event or act which constitutes, or
which after notice, lapse of time or both, would constitute, a material default
by the Company of any of the foregoing.
ARTICLE 5
CONDUCT OF THE COMPANY PENDING THE CLOSING
The business of the Company shall be conducted only in, and the Company
shall not take any action except in, and the directors and officers of the
Company shall cause the Company to be conducted in, the ordinary course of
business and in a manner consistent with past practice and in accordance with
applicable law; and the Company shall use all commercially reasonable efforts to
preserve substantially intact the business organization of the Company, to keep
available the services of the current directors, officers, employees and
consultants of the Company and to preserve the current relationships of the
Company with customers, suppliers and other persons with which the Company has
significant business relations. The Company agrees to confer with GM in
connection with the preparation and adoption of any employee incentive stock
option or similar plan contemplated to be effectuated prior to or following the
Closing.
ARTICLE 6
CONDITIONS TO CLOSING
6.1 Conditions to Closing by the Company.
The obligations of the Company to GM under this Agreement are subject
to the fulfillment of the following conditions, unless waived in writing by the
Company, and provided that the Company shall utilize its best efforts to cause
the fulfillment of those conditions the fulfillment of which is under its
reasonable control:
(a) The Form 10 Registration Statement to be filed by IMPCO with
the SEC related to the Spin-Off ("Form 10") shall have become effective and the
Spin-Off shall have been consummated.
-14-
(b) The Company's Shares shall have been qualified for listing on
Nasdaq or other appropriate stock exchange.
(c) The Certificate shall have been filed with the Secretary of
State of the state of Delaware.
(d) The representations and warranties of GM contained in Article 2
shall be true on and as of the Closing with the same effect as though such
representations had been made as of the Closing.
(e) GM shall have executed each of the Transactional Agreements and
other documents evidencing its commitment to provide the consideration specified
in Section 1.3.
(f) The transfer of the Acquired Shares to GM shall be qualified or
exempt from qualification under all applicable federal and state securities laws
as of the Closing.
(g) GM shall have performed and complied with all agreements,
obligations and conditions contained in this Agreement that are required to be
performed or complied with by it on or before the Closing and shall not be in
breach of any agreement or covenant of GM contained herein.
(h) GM shall have delivered to the Company the cash consideration
specified in Section 1.3.
6.2 Conditions to Closing by GM.
The obligations of GM to the Company under this Agreement are subject
to the fulfillment of the following conditions, unless waived in writing by GM,
and provided that GM shall utilize its best efforts to cause the fulfillment of
those conditions the fulfillment of which is under its reasonable control:
(a) The Form 10 shall have become effective and the Spin-Off shall
have been consummated.
(b) The Company's Shares shall have been qualified for listing on
Nasdaq or other appropriate stock exchange.
(c) The Certificate shall have been filed with the Secretary of
State of the state of Delaware.
-15-
(d) The representations and warranties of the Company contained in
Article 4 shall be true on and as of the Closing with the same effect as though
such representations had been made as of the Closing.
(e) The Company shall have executed each of the Transactional
Documents.
(f) The Company shall have delivered to GM documentation evidencing
the transfer of assets from IMPCO to the Company prior or incidental to the
Closing, sufficient in amount to permit the Company to operate as a stand alone
business as of the Closing.
(g) The Company shall have entered into an employment agreement with
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ committing him to no less than three (3) years' continued
service with the Company and containing appropriate incentives designed to
induce his continued loyalty to the Company for a reasonable period thereafter.
(h) The transfer of the Acquired Shares to GM shall be qualified or
exempt from qualification under all applicable federal and state securities laws
as of the Closing.
(i) The Company shall have performed and complied with all
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing and
shall not be in breach of any agreement or covenant of the Company contained
herein.
(j) The Company shall have delivered to GM the certificate or
certificates evidencing the Acquired Shares specified in Section 1.2.
ARTICLE 7
SUCCESSORS AND ASSIGNS
Except as otherwise expressly provided to the contrary, the provisions of
this Agreement shall inure to the benefit of, and be binding upon, the Company
and GM and their successors and assigns, whether or not any such successor or
assign has become a party to this Agreement or has agreed in writing to join
herein and to be bound by the terms, conditions and restrictions hereof.
-16-
ARTICLE 8
LEGENDS
Legends. All certificates evidencing Acquired Shares shall bear the
following legends:
"THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF,
EXCEPT IN COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT
BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES
(OR THE PREDECESSOR IN INTEREST TO THE HOLDER). SUCH
AGREEMENT GRANTS TO THE COMPANY CERTAIN RIGHTS OF FIRST
REFUSAL UPON AN ATTEMPTED TRANSFER OF THE SHARES. THE
SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH
A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT
CHARGE."
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT
BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION
OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL,
THAT SUCH REGISTRATION IS NOT REQUIRED."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
A MARKET STANDOFF RESTRICTION AS SET FORTH IN A CERTAIN
AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF
THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF SUCH
AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS
AFTER THE EFFECTIVE DATE OF THE INITIAL PUBLIC OFFERING OF
THE COMMON STOCK OF THE ISSUER HEREOF AND FOR 90 DAYS AFTER
THE EFFECTIVE DATES OF EACH OF THE FIRST TWO REGISTRATIONS
THEREAFTER PROVIDED,
-17-
THAT SUCH REGISTRATIONS BECOME EFFECTIVE WITHIN THREE YEARS OF SUCH
CLOSING DATE. SUCH RESTRICTION IS BINDING ON PURCHASERS OF THESE
SHARES."
If required by the authorities of any state in connection with the issuance of
the Acquired Shares, the legend or legends required by such state authorities
shall also be endorsed on all such certificates.
ARTICLE 9
NOTICE
Any notice required by the terms of this Agreement shall be given in
writing and shall be (a) mailed by registered or certified mail, postage
prepaid, return receipt requested, (b) delivered by a nationally recognized
overnight courier, (c) sent by conformed facsimile or (d) otherwise delivered by
hand or by messenger. Notice shall be addressed to the Company at its principal
executive office and to GM at the address listed on the signature page hereof or
at such other address as such party may designate by ten (10) days' advance
written notice to the other party given in the foregoing manner. If notice is
provided by mail, notice shall be deemed to be given upon receipt as evidenced
by postal records; if by overnight courier, notice shall be deemed to be given
twenty-four (24) hours after deposit; if by facsimile, upon completion of such
facsimile transmission as conclusively evidenced by the transmission receipt;
and if by hand or messenger, upon receipt.
ARTICLE 10
SURVIVAL
All representations and warranties contained in this Agreement or the
Transactional Agreements, and obligations under covenants and agreements
contained herein or therein to be performed or complied with before the Closing,
shall be deemed to be continuing and shall survive the Closing, but shall expire
on the third anniversary of the date of this Agreement unless a specific claim
in writing with respect to any such matter shall have been made or an action or
proceeding at law or in equity shall have been commenced or filed before such
anniversary date. The covenants and agreements contained in this Agreement and
the Transactional Agreements that contemplate obligations or performance after
the Closing shall survive the Closing and shall continue until all obligations
with respect thereto shall have been performed or satisfied or shall have been
terminated in accordance with their terms.
-18-
ARTICLE 11
ENTIRE AGREEMENT
This Agreement and the other agreements, documents, exhibits, and writings
attached and/or delivered pursuant hereto or entered into concurrently herewith,
including, without limitation, the Transactional Agreements entered into by the
parties hereto, constitute the entire contract between the parties hereto with
regard to the subject matter hereof and thereof, and supersede any other
agreements, representations or understandings (whether oral or written and
whether express or implied) relating to the subject matter hereof and thereof.
ARTICLE 12
CHOICE OF LAW
This Agreement shall be governed by, and construed in accordance with, the
laws of the state of Delaware, as such laws are applied to contracts entered
into and to be performed entirely within such state.
ARTICLE 13
DEFINITIONS
13.1 "Affiliate" shall mean with respect to any Person, any other Person
that controls, is controlled by or is under common control with, such first
Person. As used herein, "control" shall mean, with respect to any Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through
ownership of voting securities or other interests, by contract or otherwise.
13.2 "Board of Directors" shall mean the Board of Directors of the
Company, as constituted from time to time.
13.3 "Consideration" shall mean the amount for which the Acquired Shares
may be Acquired pursuant to this Agreement, as specified in Section 1.3.
13.4 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and all rules promulgated thereunder.
13.5 "Fair Market Value" shall mean the fair market value of a Share or of
offered consideration at the time of closing of the relevant transaction as
determined by the Board of Directors in good faith following a review of
relevant factors and advice from independent legal and accounting advisors.
Such determination shall be conclusive and binding on all persons.
-▇▇-
▇▇.▇ "▇▇▇ ▇▇▇" shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements
Act of 1976, as amended.
13.7 "Person" shall mean any natural person or a corporation, general or
limited partnership, limited or unlimited liability company, trust, joint
venture, association, company, unincorporated organization or other entity.
13.8 "Right of First Refusal" shall mean the right of first refusal of
the Company and its assignees described in Article 3.
13.9 "SEC" shall mean the Securities and Exchange Commission.
13.10 "Securities Act" shall mean the Securities Act of 1933, as amended,
and all rules promulgated thereunder.
13.11 "Spin-Off" shall mean the distribution pro rata to IMPCO's
stockholders of Shares of the Company's Common Stock as further described in the
Recitals hereto.
13.12 "Share" shall mean one share of Common Stock.
13.13 "Transferee" shall mean any Person to whom GM has directly or
indirectly transferred any Acquired Share.
-20-
IN WITNESS WHEREOF, the parties have executed this Agreement on June 12,
2001.
COMPANY:
QUANTUM TECHNOLOGIES WORLDWIDE, INC.,
a Delaware corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
______________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and CEO
Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
GENERAL MOTORS CORPORATION,
a Delaware corporation
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
______________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President, GM Research &
Development and Planning
Address: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
M/C: 480-106-EX2
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-▇▇-
▇▇▇▇▇▇▇ "▇"
▇▇▇▇▇▇▇▇ CERTIFICATE OF INCORPORATION
-22-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
RESTATED CERTIFICATE OF INCORPORATION
OF
QUANTUM TECHNOLOGIES WORLDWIDE, INC.
Quantum Technologies Worldwide, Inc., a Delaware corporation, hereby
certifies that:
1. The name of this Corporation is QUANTUM TECHNOLOGIES WORLDWIDE, INC.
The date of filing its original Certificate of Incorporation with the Secretary
of State was October 13, 2000. The prior name of the Corporation was Quantum
Technologies, Inc.
2. This Restated Certificate of Incorporation of the Corporation attached
hereto as Exhibit "A," which is incorporated herein by this reference, and which
restates, integrates and further amends the provisions of the Certificate of
Incorporation as heretofore amended or supplemented, has been duly adopted by
the Corporation's Board of Directors and a majority of the stockholders in
accordance with Sections 242 and 245 of the Delaware General Corporation Law
("DGCL"), with the approval of the Corporation's stockholders having been given
by written consent without a meeting in accordance with Section 228 of the DGCL.
IN WITNESS WHEREOF, this Corporation has caused this Restated Certificate
of Incorporation to be signed by its duly authorized officer and the foregoing
facts stated herein are true and correct.
DATED: _______________________
QUANTUM TECHNOLOGIES
WORLDWIDE, INC.
By: ___________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
EXHIBIT "A"
RESTATED CERTIFICATE OF INCORPORATION
OF
QUANTUM TECHNOLOGIES WORLDWIDE, INC.
I. Name
The name of the Corporation is QUANTUM TECHNOLOGIES WORLDWIDE, INC.
(hereinafter sometimes referred to as the "Corporation").
II. Registered Office and Agent
The address of the registered office of the Corporation in the State of
Delaware is ▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, in the City of Dover, County of
Kent. The name of its registered agent at such address is AmeriSearch Corporate
Services, Inc.
III. Purposes
The nature of the business of the Corporation and the objects or purposes
to be transacted, promoted or carried on by it are as follows: to engage in any
lawful act or activity for which corporations may be organized under the
Delaware General Corporation Law.
IV. Shares
The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is Fifty Million (50,000,000) shares,
consisting of Thirty-five Million (35,000,000) shares of Common Stock with a par
value of $0.001 per share (the "Common Stock") and Fifteen Million (15,000,000)
shares of Preferred Stock with a par value of $0.001 per share.
A. Preferred Stock. Any of the shares of Preferred Stock authorized by
---------------
this Certificate of Incorporation may be issued from time to time in one or more
series. Subject to the limitations and restrictions set forth in this Article
IV, the Board of Directors, by resolution or resolutions, is authorized to
create or provide for any such series and to fix the designations, preferences
and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, including, without
limitation, the authority to fix or alter the dividend rights, dividend rates,
conversion rights, exchange rights, voting rights, rights and terms of
redemption (including sinking and purchase fund provisions), the redemption
price or prices, the dissolution preferences
-2-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
and the right in respect to any distribution of assets of any wholly unissued
series of Preferred Stock and the number of shares constituting any such series,
and the designation thereof, or any of them and to increase or decrease the
number of shares of any series so created, subsequent to the issue of that
series but not below the number of shares of such series then outstanding. In
case the number of shares of any series shall be so decreased, the shares
constituting such decrease shall resume the status which they had prior to the
adoption of the resolution originally fixing the number of shares of such
series.
There shall be no limitation or restriction on any variation between any of
the different series of Preferred Stock as to the designation, preferences and
relative, participating, optional or other special rights, and the
qualification, limitations or restrictions thereof; and the several series of
Preferred Stock may, except as hereinafter otherwise expressly provided, vary in
any and all respects as fixed and determined by the Board of Directors,
providing for the issuance of the various series; provided, however, that all
shares of any one series of Preferred Stock shall have the same designation,
preferences, and relative, participating, optional or other special rights and
qualifications, limitations and restrictions.
Except as otherwise required by law, or as otherwise fixed by resolution or
resolutions of the Board of Directors with respect to one or more series of
Preferred Stock, the entire voting power and all voting rights shall be vested
exclusively in the Common Stock, and each stockholder of the Corporation who at
the time possesses voting power for any purpose shall be entitled to one vote
for each share of such stock standing in such stockholder's name on the books of
the Corporation. The Corporation shall exercise its power to issue Preferred
Stock with the view of avoiding the issuance of fractional shares. No
stockholder shall have the right to split the whole shares into fractions.
B. Common Stock. Any of the shares of Common Stock authorized by this
------------
Certificate of Incorporation may be issued from time to time in one or more
series. Subject to the limitations and restrictions set forth in this Article
IV, the Board of Directors, by resolution or resolutions, is authorized to
create or provide for any such series and to fix the designations, preferences
and relative rights and restrictions thereof. Thirty Million (30,000,000)
shares of the authorized shares of Common Stock are hereby designated Common
Stock (the "Common Stock") and Five Million (5,000,000) shares of the authorized
shares of Common Stock are hereby designated Series A Common Stock (the "Series
A Common"). The relative rights, preferences, privileges and restrictions
granted to or imposed upon the Corporation's Common Stock, Series A Common, or
upon the holders thereof, are as follows:
1. Dividends. The holders of shares of all series of Common Stock
---------
shall be entitled to receive such dividends as from time to time may be declared
by the Board of Directors of the Corporation, subject to the provisions of
Subdivision A of this
-3-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
Article IV with respect to rights of holders of the Preferred Stock. The holders
of all series of Common Stock shall share ratably, based upon the number of
shares of Common Stock or Series A Common held by them, in all dividends to
which the holders of Common Stock may be entitled.
2. Liquidation. Upon any liquidation, dissolution or winding up of
-----------
the Corporation, whether voluntary or involuntary, after any preferential
amounts to be distributed to the holders of any series of Preferred Stock then
outstanding, the holders of all series of Common Stock shall share ratably,
based upon the number of shares of Common Stock or Series A Common held by them,
in all of the remaining assets of the Corporation available for distribution to
its stockholders.
3. Voting Rights. Except as otherwise provided by law and subject
-------------
to the provisions set forth in this Article IV, the holders of all series of
Common Stock issued and outstanding shall be entitled to vote one vote for each
share thereof held on all matters.
4. Designation of Rights and Preferences of Series A Common. The
--------------------------------------------------------
Series A Common authorized under this Certificate of Incorporation shall be
convertible into shares of this corporation's Common Stock, as described in
Section 4.2 below. In addition to the rights, preferences, restrictions and
other matters relating to all series of Common Stock described above, the Series
A Common shall have the following additional rights:
4.1. Anti-Dilution Protection. As provided in this Section 4.1,
------------------------
the number of outstanding shares of Series A Common shall be subject to
adjustment from time to time upon the occurrence of certain events, the purpose
of which adjustment or adjustments shall be for the number of shares of issued
and outstanding Series A Common to equal twenty percent (20%) of the issued and
outstanding shares of all series of Common Stock of the Corporation (the "Issued
and Outstanding Common Shares"); provided, however, that the Issued and
Outstanding Common Shares shall specifically exclude any shares of Common Stock
and options therefor issued to directors, officers, employees or consultants of
the Corporation pursuant to a stock option or other equity incentive plan or
agreement approved by the Board of Directors of the Corporation (a "Plan").
4.1(a) Upon the happening of an Extraordinary Common Stock
Event (as defined below) after June 12, 2001, the number of outstanding shares
of Series A Common shall be adjusted to a number equal to that number of shares
of Common Stock determined by multiplying the number of the then Issued and
Outstanding Common Shares by twenty percent (20%). The adjustment shall occur
automatically without the need for any action by the holders of such shares and
whether or not the certificates representing such shares are surrendered to the
Corporation or its transfer
-4-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
agent; provided, however, that the Corporation shall not be obligated to issue
certificates evidencing the shares of Series A Common issuable upon such
adjustment but shall maintain adequate records, accessible to each holder of
Series A Common, setting forth the effective date of the adjustment, the amount
of the required adjustment and the computation thereof. The number of shares of
outstanding Series A Common, as so adjusted, shall be readjusted in the same
manner upon the happening of any successive Extraordinary Common Stock Event or
Events.
4.1(b) "Extraordinary Common Stock Event" shall mean (i)
the issuance of additional shares of Common Stock other than shares of Common
Stock and options therefore issued pursuant to a Plan; (ii) the issuance of
additional shares of Common Stock as a dividend or other distribution on
outstanding Common Stock of the Corporation, (iii) a subdivision of outstanding
shares of Common Stock into a greater number of shares of Common Stock, of (iv)
a combination of outstanding shares of Common Stock into a smaller number of
shares of Common Stock.
4.2 Automatic Conversion. Upon the closing of an initial
--------------------
public offering of the Corporation's securities to the general public ("IPO")
pursuant to a registration statement of the Corporation filed under the
Securities Act of 1933, as amended to date, the outstanding shares of Series A
Common shall automatically be converted into that number of shares of Common
Stock that would be equal to twenty percent (20%) of the Issued and Outstanding
Common Shares immediately following the closing of the IPO. The Corporation
shall, as soon as practicable after the closing date of the IPO (the "Closing
Date"), issue and deliver to the holder of the outstanding shares of Series A
Common, a certificate or certificates for the number of shares of Common Stock
to which it shall be entitled as aforesaid. Such conversion shall be deemed to
have been made immediately prior to the close of business on the Closing Date,
and the person or persons entitled to receive the shares of Common Stock
issuable upon such conversion shall be treated for all purposes as the record
holder or holders of such shares of Common Stock. Upon such conversion and
notwithstanding that the certificates evidencing such shares of Series A Common
shall not have been surrendered, the shares so converted shall be deemed
canceled and shall not be issuable by this Corporation, the rights of the
holders of the Series A Common with respect to such shares shall terminate and
the authority of the Corporation to issue shares of Series A Common Stock shall
terminate. The Certificate of Incorporation of this Corporation shall be
appropriately amended to effect the change in the Corporation's authorized
capital stock.
V. Board of Directors
The Board of Directors is expressly authorized to make, alter, or repeal
the Bylaws of the Corporation.
-5-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
VI. Election of Directors
Elections of directors need not be by written ballot unless the Bylaws of
the Corporation shall so provide. The number of directors shall be fixed from
time to time by the Board of Directors pursuant to a resolution adopted by a
majority of the total number of authorized directors (whether or not there exist
any vacancies in the previously authorized directorships at the time any such
resolution is presented to the Board for adoption).
VII. Creditors
Whenever a compromise or arrangement is proposed between the Corporation
and its creditors or any class of them and/or between the Corporation and its
stockholders or any class of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of the
Corporation or of any creditor or stockholder thereof, or on the application of
any receiver or receivers appointed for the Corporation under the provisions of
Section 291 of Title 8 of the Delaware Code or on the application of trustees in
dissolution or of any receiver or receivers appointed for the Corporation under
the provisions of Section 279 of Title 8 of the Delaware Code order a meeting of
the creditors or class of creditors, and/or of the stockholders or class of
stockholders of the Corporation, as the case may be, to be summoned in such
manner as the said court directs. If a majority in number representing three-
fourths in value of the creditors or class of creditors, and/or the stockholders
or class of stockholders of the Corporation, as the case may be, agree to any
compromise or arrangement and to any reorganization of the Corporation as a
consequence of such compromise or arrangement, the said compromise or
arrangement and the said reorganization shall, if sanctioned by the court to
which the said application has been made, be binding on all the creditors or
class of creditors, and/or on all the stockholders or class of stockholders, of
the Corporation, as the case may be, and also on the Corporation.
VIII. Amendments
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation, in the manner now or
hereafter prescribed by statutes, and all rights conferred upon stockholders
herein are granted subject to this reservation.
IX. Director Liability
A director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional
-6-
EXHIBIT "A" TO STOCK TRANSFER AGREEMENT
misconduct or a knowing violation of law, (iii) under Section 174 of the
Delaware General Corporation Law, or (iv) for any transaction from which the
director derived any improper personal benefit. If the Delaware General
Corporation Law is amended after approval by the stockholders of this Article to
authorize corporation action further eliminating or limiting the personal
liability of directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by the Delaware
General Corporation Law as so amended.
IN WITNESS WHEREOF, said Corporation has caused this Certificate of
Amendment to be signed by its duly authorized officer this __ day of
_____________, 2001 and the foregoing facts stated herein are true and correct.
QUANTUM TECHNOLOGIES WORLDWIDE, INC.
By:___________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
-7-
EXHIBIT "B"
REGISTRATION RIGHTS AGREEMENT
(Omitted)
-8-
EXHIBIT "C"
COMPANY EXCEPTIONS
Schedule 4.2(c)
CAPITALIZATION
(as of June 12, 2001)
Number of Percentage
Stockholder Shares Ownership
----------- ------ ---------
IMPCO 10,000,000 100%
[See Following Page]
-9-
Schedule 4.9
LITIGATION
(as of June 12, 2001)
IMPCO Technologies, Inc. v. GFI Control Systems, Inc. and Dynatek Industries,
-----------------------------------------------------------------------------
Ltd.
----
▇▇. ▇▇-▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ (filed August 11, 2000)
-10-
EXHIBIT "D"
FORMS OF INVENTIONS AND CONFIDENTIAL
INFORMATION AGREEMENTS
-11-
EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
FORM OF NEW
Quantum Technologies Worldwide, Inc.
Inventions and Confidential Information Agreement
In consideration of, and as a condition of, my employment with Quantum
Technologies Worldwide, Inc., a Delaware corporation (the "Company"), I hereby
represent to, and agree with, the Company as follows:
Section 1. Definitions
1.1 "Agreement" means this Inventions and Confidential Information
Agreement.
1.2 "Competing Business" means any business whose efforts are in
competition with the efforts of the Company. A Competing Business includes any
business whose efforts involve any research and development, products or
services in competition with products or services which are, during and at the
end of the Term, either (a) produced, marketed or otherwise commercially
exploited by the Company or (b) in actual or demonstrably anticipated research
or development by the Company.
1.3 "Confidential Information" means any information that (a) relates to
the business of the Company, (b) is not generally available to the public, and
(c) is conceived, compiled, developed, discovered or received by, or made
available to, me during the Term, whether solely or jointly with others, and
whether or not while engaged in performing work for the Company. Confidential
Information includes information, both written and oral, relating to Inventions,
trade secrets and other proprietary information, technical data, products,
services, finances, business plans, marketing plans, legal affairs, suppliers,
clients, prospects, opportunities, contracts or assets of the Company.
Confidential Information also includes any information which has been made
available to the Company by or with respect to third parties and which the
Company is obligated to keep confidential.
1.4 "Invention" means any product, device, technique, know-how, computer
program, algorithm, method, process, procedure, improvement, discovery or
invention, whether or not patentable or copyrightable and whether or not reduced
to practice, that (a) is within the scope of the Company's business, research or
investigations or results from or is suggested by any work performed by me for
the
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
Company and (b) is created, conceived, reduced to practice, developed,
discovered, invented or made by me during the Term, whether solely or jointly
with others, and whether or not while engaged in performing work for the
Company.
1.5 "Material" means any product, prototype, model, document, diskette,
tape, picture, design, recording, writing or other tangible item which contains
or manifests, whether in printed, handwritten, coded, magnetic or other form,
any Confidential Information, Invention or Proprietary Right.
1.6 "Person" means any corporation, partnership, trust, association,
governmental authority, educational institution, individual or other entity.
1.7 "Proprietary Right" means any patent, copyright, trade secret,
trademark, trade name, service ▇▇▇▇, maskwork or other protected intellectual
property right in any Confidential Information, Invention or Material.
1.8 "Term" means the term of my employment with the Company, whether on
a full-time, part-time or consulting basis.
Section 2. Purpose of Agreement
2.1 I understand that the Company is engaged in a continuous program of
research, development, production and marketing in connection with its business
and that it is critical for the Company to preserve and protect its Proprietary
Rights, including its Confidential Information, its rights in Inventions and in
all related intellectual property rights. Accordingly, I am entering into this
Agreement as a condition of my employment with the Company, whether or not I am
expected to create inventions of value for the Company.
Section 3. Ownership and Use
3.1 The Company will be the exclusive owner of all Confidential
Information, Inventions, Materials and Proprietary Rights. To the extent
applicable, all Materials will constitute "works for hire" under applicable
copyright laws.
3.2 I assign and transfer, and agree to assign and transfer, to the
Company all rights and ownership that I have or will have in Confidential
Information, Inventions, Materials and Proprietary Rights, subject to the
limitations set forth in Section 3.5 and in the notice set forth in Section 3.6
below. Further, I waive any moral rights that I may have in any Confidential
Information, Inventions, Materials and Proprietary Rights. I will take such
action (including signature and assistance in preparation of documents or the
giving of testimony) as may be requested by the
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
Company to evidence, transfer, vest or confirm the Company's rights and
ownership in Confidential Information, Inventions, Materials and Proprietary
Rights. I agree to keep and maintain adequate and current written records of all
Inventions and Proprietary Rights during the Term. The records will be in the
form of notes, sketches, drawings, and any other format that may be specified by
the Company. The records will be available to and remain the sole property of
the Company at all times. I will not contest the validity of any Proprietary
Right, or aid or encourage any third party to contest the validity of any
Proprietary Right of the Company.
If the Company is unable for any reason to secure my signature to fulfill
the intent of the foregoing paragraph or to apply for or to pursue any
application for any United States or foreign patents or copyright registrations
covering Inventions assigned to the Company above, then I irrevocably appoint
the Company and its authorized agents as my agent and attorney in fact, to
transfer, vest or confirm the Company's rights and to execute and file any such
applications and to do all other lawful acts to further the prosecution and
issuance of letters patent or copyright registrations with the same legal force
as if done by me.
3.3 Except as required for performance of my work for the Company or as
authorized in writing by the Company, I will not (a) use, disclose, publish or
distribute any Confidential Information, Inventions, Materials or Proprietary
Rights or (b) remove any Materials from the Company's premises.
3.4 I will make prompt and full disclosure to an officer of the Company,
or to any individual designated by the Company for that purpose, of all
Confidential Information, Inventions, Materials or Proprietary Rights, as well
as any business opportunity which comes to my attention during the Term and
which relates to the business of the Company or which arises as a result of my
employment with the Company. I will not take advantage of or divert any such
opportunity for the benefit of myself or anyone else either during or after the
Term without the prior written consent of the Company.
3.5 Exhibit A is a list describing all inventions, original works of
authorship, developments, improvements, and trade secrets which were made by me
prior to the Term (collectively referred to as "Prior Inventions"), which belong
to me, which relate to the Company's current or proposed business, products or
research and development, and which are not assigned to the Company hereunder;
or, if no such list is attached, I represent that there are no such Prior
Inventions. If, during the Term, I incorporate into a Company product, process
or machine a Prior Invention owned by me or in which I have an interest, the
Company is granted and shall have a nonexclusive, royalty-free, irrevocable,
perpetual, worldwide license to make, have
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
made, modify, use and sell such Prior Invention as part of or in connection with
such product, process or machine.
3.6 Labor Code Section 2870 Notice. I have been notified and understand
that the provisions of Sections 3.1 and 3.2 of this Agreement do not apply to
any Invention assigned hereunder that qualifies fully under the provisions of
Section 2870 of the California Labor Code, which states as follows:
ANY PROVISION IN AN EMPLOYMENT AGREEMENT WHICH PROVIDES
THAT AN EMPLOYEE SHALL ASSIGN, OR OFFER TO ASSIGN, ANY
OF HIS OR HER RIGHTS IN AN INVENTION TO HIS OR HER
EMPLOYER SHALL NOT APPLY TO AN INVENTION THAT THE
EMPLOYEE DEVELOPED ENTIRELY ON HIS OR HER OWN TIME
WITHOUT USING THE EMPLOYER'S EQUIPMENT, SUPPLIES,
FACILITIES, OR TRADE SECRET INFORMATION EXCEPT FOR
THOSE INVENTIONS THAT EITHER: (1) RELATE AT THE TIME OF
CONCEPTION OR REDUCTION TO PRACTICE OF THE INVENTION TO
THE EMPLOYER'S BUSINESS, OR ACTUAL OR DEMONSTRABLY
ANTICIPATED RESEARCH OR DEVELOPMENT OF THE EMPLOYER; OR
(2) RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR
THE EMPLOYER. TO THE EXTENT A PROVISION IN AN
EMPLOYMENT AGREEMENT PURPORTS TO REQUIRE AN EMPLOYEE TO
ASSIGN AN INVENTION OTHERWISE EXCLUDED FROM BEING
REQUIRED TO BE ASSIGNED UNDER CALIFORNIA LABOR CODE
SECTION 2870(a), THE PROVISION IS AGAINST THE PUBLIC
POLICY OF THIS STATE AND IS UNENFORCEABLE.
3.7 Inventions Assigned to the United States. I agree to assign to the
United States government all my right, title and interest in and to any and all
Inventions whenever such full title is required to be in the United States by a
contract between the Company and the United States or any of its agencies.
Section 4. Further Obligations
4.1 During the Term, I will not, directly or indirectly, engage in, be
employed by, perform services for or otherwise participate in any Competing
Business.
4.2 My execution, delivery and performance of this Agreement and the
performance of my other obligations and duties to the Company will not cause any
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
breach, default or violation of any other employment, nondisclosure,
confidentiality, consulting or other agreement to which I am a party or by which
I may be bound. Attached as Exhibit B is a list of all prior agreements now in
effect under which I have agreed to keep information confidential or not to
compete or solicit employees of any Person.
4.3 I will not use in performance of my work for the Company or disclose
to the Company any trade secret, confidential or proprietary information of any
prior employer or other Person if and to the extent that such use or disclosure
may cause a breach, default or violation of any obligation or duty that I owe to
such other Person (e.g., under any agreement or applicable law). My compliance
with this Section 4.3 will not prohibit, restrict or impair the performance of
my work, obligations and duties to the Company.
Section 5. Nonsolicitation
5.1 Employees/Consultants. During the Term and for one year after the end
of the Term (the "Additional Period"), I will not induce, or attempt to induce,
any employee or consultant of the Company to cease such employment or
relationship to engage in, be employed by, perform services for, participate in
the ownership, management, control or operation of, or otherwise be connected
with, either directly or indirectly, any Competing Business.
5.2 Suppliers/Contractors. During the Term and for the Additional Period,
I agree (except on behalf of or with the prior written consent of the Company)
that I will not, directly or indirectly (a) solicit, divert, appropriate to or
accept on behalf of any Competing Business, or (b) attempt to solicit, divert,
appropriate to or accept on behalf of any Competing Business, any business from
any customer or actively sought prospective customer of the Company with whom I
have dealt, whose dealings with the Company have been supervised by me or about
whom I have acquired Confidential Information in the course of my employment.
Section 6. Termination of Relationship
6.1 I agree that at the end of the Term I will deliver to the Company (and
will not keep in my possession, re-create or deliver to anyone else) any and all
Materials and other property belonging to the Company, its successors, assigns,
customers and/or development partners. I agree to sign and deliver the
"Termination Certification" attached as Exhibit C.
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
6.2 At the end of the Term, I agree to provide the name of my new
employer, if any, and consent to notification by the Company to my new employer
about my rights and obligations under this Agreement in the form of Exhibit D.
Section 7. Employment At Will
I understand that this Agreement does not obligate the Company to employ me
for any stated period of time. I understand that my employment is "at will"
which means that it can be terminated at any time by the Company or by me, with
or without cause and with or without notice. I agree that any promise or
obligation that my employment be on any other basis than "at will" is invalid
unless in writing signed by the president of the Company. I agree to abide by
the Company's rules, regulations, policies and practices as revised from time to
time.
[NOTE: The above provision will be deleted in its entirety or
substantially modified in the form of Inventions and Confidential Information
Agreement for individuals with employment agreements.]
Section 8. Miscellaneous
7.1 Survival. This Agreement will survive the end of the Term.
7.2 Successors and Assigns; Assignment. Except as otherwise provided in
this Agreement, this Agreement and the rights and obligations of the parties
hereunder will be binding upon and inure to the benefit of their respective
successors, assigns, heirs, executors, administrators and legal representatives.
The Company may assign any of its rights and obligations under this agreement.
I understand that I may not assign, whether voluntarily or by operation of law,
any of my rights and obligations under this Agreement, except with the prior
written consent of the Company.
7.3 Injunctive Relief; Costs. I acknowledge that my obligations under
this Agreement are important to the Company, and that the Company would not
employ or continue to employ me without my agreement to such obligations. I
also acknowledge that if I do not abide by my obligations in this Agreement, the
Company will suffer immediate and irreparable harm, and that the damage to the
Company will be difficult to measure and financial relief will be incomplete.
Accordingly, the Company will be entitled to injunctive relief and other
equitable remedies in the event of a breach by me of any obligation under this
Agreement. The rights and remedies of the Company under this section are in
addition to all other remedies. Further, in any legal action or other
proceeding in connection with this Agreement (e.g., to recover damages or other
relief), the prevailing party will be entitled to recover its reasonable
attorneys' fees and other costs incurred.
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
7.4 Severability. This Agreement will be enforced to the fullest extent
permitted by applicable law. If for any reason any provision of this Agreement
is held to be invalid or unenforceable to any extent, then (a) such provision
will be interpreted, construed or reformed to the extent reasonably required to
render the same valid, enforceable and consistent with the original intent
underlying such provision and (b) such invalidity or unenforceability will not
affect any other provision of this Agreement or any other agreement between the
Company and me.
7.5 Governing Law; Jurisdiction; Venue. This Agreement will be governed
by the laws of the state of California without regard to principles of conflicts
of law. I irrevocably consent to the jurisdiction and venue of the state and
federal courts located in Orange County, California in connection with any
action relating to this Agreement. I will not bring any action relating to this
Agreement in any other court.
7.6 Amendments. Neither this Agreement nor any provision may be amended
except by written agreement signed by the parties.
7.7 Waivers. No waiver of any breach shall be considered valid unless in
writing, and no waiver shall be a waiver of any subsequent breach.
7.8 Acknowledgment. I have carefully read all of the provisions of this
Agreement and agree that (a) the same are necessary for the reasonable and
proper protection of the Company's business, (b) the Company has been induced to
enter into and/or continue its relationship with me in reliance upon my
compliance with the provisions of this Agreement, (c) every provision of this
Agreement is reasonable with respect to its scope and duration, (d) I have
executed this Agreement without duress or coercion from any source, and (e) I
have received a copy of this Agreement.
This Agreement shall be effective as of [ enter date employment
----------------------------
agreement is effective] .
---------------------------------
___________________________
Signature
___________________________
FULL NAME (print or type)
Soc. Sec. No.______________
ACCEPTED:
--------
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
QUANTUM TECHNOLOGIES WORLDWIDE, INC.
By: _____________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and CEO
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
EXHIBIT A
LIST OF PRIOR INVENTIONS AND
ORIGINAL WORKS OF AUTHORSHIP
Identifying Number
Title Date or Brief Description
----------------------------- ------------------- ---------------------------------
_____ No inventions or improvements
_____ Additional Sheets Attached
Signature of Employee: ____________________________________
Print Name of Employee: ___________________________________
Date: ___________________
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
EXHIBIT B
The following is a list of all prior agreements with former employers or
others to which I am a party in which I agreed to maintain the confidentiality
of the information of, or not to compete with or solicit the employees or
customers of a third party.
_____ No Agreements
_____ See below
_____ Additional sheets attached
Signature of Employee: ____________________________________
Print Name of Employee: ___________________________________
Date: ___________________
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
EXHIBIT C
TERMINATION CERTIFICATION
This is to certify that I do not have in my possession, and I have not
failed to return, any Materials or other property belonging to Quantum
Technologies Worldwide, Inc., its subsidiaries, affiliates, successors or
assigns (together, the "Company").
I further certify that I have complied with all the terms of the Company's
Inventions and Confidential Information Agreement signed by me, including the
reporting of any Inventions conceived or made by me (solely or jointly with
others) covered by that Agreement, a copy of which is attached.
I further agree that, in compliance with the Agreement, I will not use,
disclose, publish or distribute any Confidential Information, Inventions,
Materials or Proprietary Rights.
During the Term and for one year after the end of the Term (the "Additional
Period"), I will not induce, or attempt to induce, any employee or independent
contractor of the Company to cease such employment or relationship to engage in,
be employed by, perform services for, participate in the ownership, management,
control or operation of, or otherwise be connected with, either directly or
indirectly, any Competing Business.
During the Term and for the Additional Period, I agree (except on behalf of
or with the prior written consent of the Company) that I will not, directly or
indirectly (a) solicit, divert, appropriate to or accept on behalf of any
Competing Business, or (b) attempt to solicit, divert, appropriate to or accept
on behalf of any Competing Business, any business from any customer or actively
sought prospective customer of the Company with whom I have dealt, whose
dealings with the Company have been supervised by me or about whom I have
acquired Confidential Information in the course of my employment.
Signature of Employee: ____________________________________
Print Name of Employee: ___________________________________
Date: ___________________
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EXHIBIT "D" TO STOCK TRANSFER AGREEMENT
EXHIBIT D
NOTIFICATION TO NEW EMPLOYERS
[Letterhead of Quantum Technologies Worldwide, Inc.]
Dear [name of new employer's president]:
We understand that our former employee, [name of employee], has accepted
employment with your company. This letter is to advise you that [name of
employee] signed an Inventions and Confidential Information Agreement with our
Company that remains in full force and effect. At the time [name of employee]
left our company, we advised [him/her] of [his/her] continuing obligations under
the Agreement and [name of employee] signed a Termination Certificate affirming
[his/her] obligations under the Agreement. A copy of the Termination
Certificate, dated __________, 200_, is enclosed so that any conflict with these
obligations can be avoided during [his/her] employment with you.
Very truly yours,
[Signature of Company president or
corporate counsel]
_______________________________
[Typed name]
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