Common Stock Purchase Agreement - Nanogen Inc. and Hitachi Ltd.
NANOGEN, INC.
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "Agreement") is made as of
July 26, 2000 by and between Nanogen, Inc., a Delaware corporation (the
"Company") and Hitachi, Ltd., a corporation organized and existing under the
laws of Japan, through its Instrument Group and having its principal place of
business at 5-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo, 100 Japan, Nissei Sangyo
Co. Ltd., having its principal place of business at 24-14, Nishi-shimbashi,
1-chome, Minato-ku, Tokyo, 105-8717 Japan, and Hitachi Instruments Service Co.,
Ltd., having its principal place of business at 28-8 Yotsuya 4-Chrome,
Shinjuku-ku Tokyo 160-0004 (collectively, "Purchasers").
THE PARTIES HERETO HEREBY AGREE AS FOLLOWS:
1. PURCHASE AND SALE OF COMMON STOCK.
1.1 SALE AND ISSUANCE OF COMMON STOCK. Subject to the terms
and conditions of this Agreement, the Purchasers shall purchase at the
Closing (as defined below) and the Company agrees to sell and issue to the
Purchasers at the Closing a total of Two Million United States Dollars
($2,000,000) (the "Purchase Price") worth of shares of the Company's Common
Stock, $.001 par value per share (the "Shares"), at a per share price (the
"Share Price") equal to the last reported closing price of the Company's
Common Stock reported on the Nasdaq National Market on the Effective Date of
the Nanogen/Hitachi Collaboration Agreement by and between the Purchasers,
and the Company, dated July 26, 2000 (the "Collaboration
Agreement"); provided, however, that Purchasers' aggregate beneficial
ownership interest in the Company's Common Stock shall not at any time equal
or exceed nineteen percent (19%) of the Company's outstanding Common Stock.
Nothing in this Agreement shall be deemed to impose any management or control
obligations on the Purchasers. The number of Shares to be sold and purchased
by each of the Purchasers and the Share Price are described in Exhibit A
attached hereto.
1.2 CLOSING. The purchase and sale of the Shares shall take place
at the offices of the Company on a date that is mutually agreed upon, orally or
in writing by the Company and the Purchasers and is within thirty (30) days of
the Effective Date of the Collaboration Agreement (which time and place is
designated as the "Closing"). At the Closing, the Company shall deliver to the
Purchasers a certificate representing the Shares being purchased thereby against
payment of the Purchase Price therefor, by check payable to the Company or wire
transfer to the Company's bank account.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants as of the date hereof to the Purchasers that:
2.1 ORGANIZATION, GOOD STANDING, AND QUALIFICATION. The Company
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power and
authority to carry on its business as now conducted and as proposed to be
conducted. The Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure so to qualify would have a
material adverse effect on its business or properties.
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2.2 CAPITALIZATION. The authorized capital of the Company
consists as of June 23, 2000 of the following:
(i) COMMON STOCK. 50,000,000 shares of common stock, $.001
par value per share, (the "Common Stock"), 20,649,070 shares of which are issued
and outstanding. All such outstanding shares of Common Stock have been validly
issued, fully paid, and non-assessable. Further, the issuance of the Shares was
made in compliance with all applicable state and federal securities laws.
(ii) PREFERRED STOCK. 5,000,000 shares of convertible
preferred stock, $.001 par value, no shares of which are issued and outstanding.
Except as set forth in the Company's latest Form 10-Q for the quarter ended
March 31, 2000 filed with the U.S. Securities and Exchange Commission (the
"SEC"), there are no outstanding options, warrants, rights (including
conversion, antidilution or preemptive rights) or agreements for the purchase or
acquisition from the Company of any shares of its capital stock.
2.3 SUBSIDIARIES. The Company does not own or control, directly
or indirectly, any interest in any other corporation, association or other
business entity, other than Nanotronics, Inc., a California corporation,
NanoVenture LLC, a Delaware limited liability company, The Nanogen/Becton
Dickinson Partnership, a Delaware general partnership, and instruments or
interests in which the company invests its excess cash.
2.4 AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement, and the authorization,
issuance and delivery of the Shares has been taken or will be taken prior to the
Closing.
2.5 VALID ISSUANCE OF SECURITIES. The Shares being issued to the
Purchasers hereunder, when issued, sold, and delivered in accordance with the
terms hereof for the consideration expressed herein, will be duly and validly
issued, fully paid and nonassessable and free of restrictions on transfer other
than restrictions of transfer under this Agreement and applicable state and
federal securities laws. Based in part upon the representations of the
Purchasers in this Agreement and subject to the provisions of Section 2.6 below,
the Shares will be issued in compliance with all applicable federal and state
securities laws.
2.6 GOVERNMENTAL CONSENTS. No consent, approval or authorization
of or designation, declaration or filing with any governmental authority or
third party on the part of the Company is required in connection with the valid
execution and delivery of this Agreement or the offer, sale or issuance of the
Shares or the consummation of any other transaction contemplated hereby or
thereby, except for filing of notices required by Section 25102(f) of the
California Corporate Securities Law of 1968, if applicable, and Regulation D
under the Securities Act of 1933, as amended (the "Securities Act") as
promulgated by the SEC and applicable Blue Sky laws.
3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. The Purchasers
hereby represent and warrant to the Company that:
3.1 AUTHORIZATION. This Agreement constitutes the valid and
legally binding obligations enforceable against the Purchasers in accordance
with its terms.
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3.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made
with the Purchasers in reliance upon the Purchasers' representations to the
Company, which by the Purchasers' execution of this Agreement the Purchasers
hereby confirm, that the Shares to be acquired by the Purchasers will be
acquired for investment for the Purchasers' own accounts, not as a nominees or
agents, and not with a view to the resale or distribution of any part thereof
and that the Purchasers have no present intention of selling, granting any
participation in, or otherwise distributing the same. By executing this
Agreement, the Purchasers further represent that the Purchasers do not presently
have any contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participations to such person or to any third person,
with respect to any of the Shares. The Purchasers represent that they have full
power and authority to enter into this Agreement.
3.3 DISCLOSURE OF INFORMATION. The Purchasers have had an
opportunity to discuss the Company's business, management and financial affairs
with the Company's management. The Purchasers have also had an opportunity to
ask questions of officers of the Company, which questions were answered to the
Purchasers' satisfaction. The Purchasers understand that such discussions, as
well as any written information issued by the Company, were intended to describe
certain aspects of the Company's business and prospects but were not an
exhaustive description.
3.4 INVESTMENT EXPERIENCE; ACCREDITED INVESTOR. The Purchasers
are experienced in evaluating and investing in securities of companies in the
Company's stage of development and acknowledge that they can bear the economic
risk of its investment and have such knowledge and experience in financial and
business matters that they are capable of evaluating the merits and risks of an
investment in the Shares. The Purchasers have not been formed for the specific
purpose of acquiring the Shares. Furthermore, the Purchasers are "Accredited
Investors" as such term is defined in Rule 501 of Regulation D of the Rules and
Regulations of the SEC.
3.5 RESTRICTED SECURITIES. The Purchasers understand that the
Shares have not been, and will not be, registered under the Securities Act, by
reason of a specific exemption from the registration provisions of the
Securities Act which depends upon, among other things, the bona fide nature of
the investment intent and the accuracy of the Purchasers' representations as
expressed herein. The Purchasers understand that, as such, the Shares are
characterized as "restricted securities" under the Securities Act and that under
the Securities Act and applicable regulations such Shares may be resold without
registration under the Securities Act only in certain limited circumstances. In
this connection, the Purchasers represent that they are familiar with Rule 144
promulgated under the Securities Act, as presently in effect, and understands
the resale limitations imposed thereby and by the Securities Act.
3.6 LEGENDS. It is understood that the Shares, and any securities
issued upon conversion or in respect thereof or exchange therefor, may bear one
or all of the following legends:
(a) "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION
OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
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(b) Any legend required by the laws of the State of
California, including any legend required by the California Department of
Corporations.
(c) Any legend required by the Blue Sky laws of any other
state to the extent such laws are applicable to the shares represented by the
certificate so legended.
3.7 CALIFORNIA CORPORATE SECURITIES LAW.
THE SALE OF THE SHARES THAT IS THE SUBJECT OF THIS AGREEMENT HAS NOT
BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA,
THE ISSUANCE OF SUCH SHARES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE
CONSIDERATION FOR SUCH SHARES PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS
THE SALE OF SHARES IS EXEMPT FROM THE QUALIFICATION BY SECTION 25100, 25102 OR
25105 OF THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS
AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED
UNLESS THE SALE IS SO EXEMPT.
4. CONDITIONS PRECEDENT TO THE PURCHASERS' OBLIGATIONS AT CLOSING.
The obligations of the Purchasers to the Company under this Agreement are
subject to the fulfillment on or before Closing, of each of the following
conditions:
4.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Company contained in Section 2 shall be true and correct in
all material respects on and as of the Closing with the same effect as though
such representations and warranties had been made on and as of the date of such
Closing.
4.2 PERFORMANCE. 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.
4.3 QUALIFICATIONS. The Commissioner of Corporations of the State
of California shall have issued a permit qualifying the offer and sale of the
Shares to the Purchaser pursuant to this Agreement, or such offer and sale shall
be exempt from such qualification under the California Corporate Securities Law
of 1968, as amended ("California Securities Law").
5. CONDITIONS PRECEDENT TO THE COMPANY'S OBLIGATIONS AT CLOSING. The
obligations of the Company to the Purchaser under this Agreement are subject to
the fulfillment, on or before the Closing, of each of the following conditions:
5.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Purchasers contained in Section 3 shall be true and correct in
all material respects on and as of the date of the Closing with the same effect
as though such representations and warranties had been made on and as of the
Closing.
5.2 CALIFORNIA QUALIFICATION. The Commissioner of Corporations of
the State of California shall have issued a permit qualifying the offer and sale
to the Purchasers of the Shares or such offer and sale shall be exempt from such
qualification under the California Securities Law.
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6. MISCELLANEOUS.
6.1 CONFIDENTIALITY. Each party hereto agrees that, except with
the prior written permission of the other party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any
confidential information, knowledge or date concerning or relating to the
business or financial affairs of the other party to which such party has been or
shall become privy by reason of this Agreement, discussions or negotiations
relating to this Agreement.
6.2 SURVIVAL OF WARRANTIES. The warranties, representations and
covenants of the Company and the Purchasers contained in or made pursuant to
this Agreement shall not survive the Closing and are made solely for the purpose
of providing the condition set forth in Section 5.1.
6.3 TRANSFER, SUCCESSORS AND ASSIGNS. The terms and conditions of
this Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
6.4 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of California in the United States of
America as applied to agreements among California residents entered into and to
be performed entirely within California.
6.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
6.6 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
6.7 NOTICES.
(a) All notices, requests, demands and other communications
under this Agreement or in connection herewith shall be given to or made upon
eaach Purchaser at the address thereof set forth on the signature page hereto
or, if to the Company at the address set forth on the signature page hereto and
addressed Attention: General Counsel.
(b) All notices, requests, demands and other communications
given or made in accordance with the provisions of this Agreement shall be in
writing and shall be sent by airmail, return receipt requested, by reputable
overnight courier or by telex or telecopy (facsimile) with confirmation of
receipt, and shall be deemed to be given or made when receipt is so confirmed.
(c) Any party may, by written notice to the other, alter
its address or respondent, and such notice shall be considered to have been
given ten (10) days after the airmailing, couriering, telexing or telecopying
thereof.
6.8 FINDER'S FEE. Each party hereto represents that it neither is
nor will be obligated for any finder's fee or commission in connection with this
transaction. The Purchasers agree to indemnify and to hold harmless the Company
from any liability for any commission or
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compensation in the nature of a finder's fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Purchasers
or any of its officers, employees, or representatives are responsible. The
Company agrees to indemnify and hold harmless the Purchasers from any liability
for any commission or compensation in the nature of a finder's fee (and the
costs and expenses of defending against such liability or asserted liability)
for which the Company or any of its officers, employees or representatives is
responsible.
6.9 EXPENSES. Each party hereto shall bear its own fees and
expenses with respect to this Agreement, and the transactions contemplated
hereby.
6.10 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Purchasers.
Any amendment or waiver effected in accordance with this Section shall be
binding upon each transferee of any Shares, each future holder of all such
Shares the Company.
6.11 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision was so excluded and shall be enforceable in
accordance with its terms.
6.12 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter hereof and
any and all other written or oral agreements existing between the parties
hereto, except the agreements specifically contemplated herein, are expressly
canceled.
6.13 LEGAL REPRESENTATION. Each Purchaser acknowledges that: (a)
it has read this Agreement and the exhibits hereto; (b) it understands that the
Company has been represented in the preparation, negotiation, and execution of
this Agreement by legal counsel; (c) it has either been represented in the
preparation, negotiation, and execution of this Agreement by legal counsel of
its own choice, or has chosen to forego such representation by legal counsel
after being advised to seek such legal representation; and (d) it understands
the terms and consequences of this Agreement and is fully aware of its legal and
binding effect.
[REST OF PAGE INTENTIONALLY OMITTED]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
NANOGEN, INC. HITACHI, LTD.
INSTRUMENT GROUP
By: /s/ HARRY J. LEONHARDT By: /s/ H. INOMATA
-------------------------------------- -------------------------------
Harry J. Leonhardt, Esq. H. Inomata
Senior Vice President, General Counsel President and Chief Executive
and Secretary Officer
Address: Address:
10398 Pacific Center Court 5-1, Marunouchi 1-chome
San Diego, CA 92121 Chiyoda-ku, Tokyo, 100
U.S.A. Japan
NISSEI SANGYO CO., LTD. HITACHI INSTRUMENTS SERVICE
CO., LTD.
By: /s/ Y. TSUNODA By: /s/ T. HONKAWA
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Y. Tsunoda T. Honkawa
Executive Managing Director President
Address: Address:
24-14, Nishi-shimbashi, 1-chome 28-8 Yotsuya 4-Chrome
Minato-ku, Tokyo, 105-8717 Shinjuku-ku, Tokyo 160-0004
Japan Japan
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EXHIBIT A
NUMBER OF SHARES AND SHARE PRICE
1. Number of Shares: 74,590
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2. Share Price: $ 26.813
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HITACHI, LTD. Number of Shares 29,836
INSTRUMENT GROUP -------------------
Purchase Price $799,992.67
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NISSEI SANGYO CO., LTD. Number of Shares 29,836
-------------------
Purchase Price $799,992.67
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HITACHI INSTRUMENTS Number of Shares 14,918
SERVICE CO., LTD. -------------------
Purchase Price $399,996.33
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