Note Secured By Stock Pledge Agreement - Sequenom Inc. and Antonius Schuh
SEQUENOM, INC.
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NOTE SECURED BY STOCK PLEDGE AGREEMENT
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$205,167 November 30, 2000
San Diego, California
FOR VALUE RECEIVED, Antonius Schuh ("Maker") promises to pay to the order
of Sequenom, Inc., a Delaware corporation (the "Corporation"), at its corporate
offices at 11555 Sorrento Valley Road San Diego, CA 92121, the principal sum of
two hundred five thousand one hundred sixty-seven dollars ($205,167), together
with all accrued interest thereon, upon the terms and conditions specified
below.
1. Purchase Money Indebtedness. The proceeds of this Note shall be applied
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solely and exclusively to the payment of certain taxes owed by Maker in
connection with Corporation's cancellation of certain notes previously issued by
Maker to Corporation.
2. Interest. Interest shall accrue on the unpaid balance outstanding from
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time to time under this Note at the rate of 6.25% per annum, compounded
annually. Accrued and unpaid interest shall become due and payable on the date
the principal balance is due.
Due Dates. The principal balance of this Note shall become due and payable
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the earlier of (i) December 31, 2001 or (ii) within ten (10) business days after
the time of the closing of the Corporation's secondary offering of shares of its
Common Stock, if at the time of the secondary offering the Maker is allowed to
sell at least a number of shares of Corporation's Common Stock which generates
minimum net proceeds required to pay the loan amount plus accrued interest.
3. Payment. Payment shall be made in lawful tender of the United States
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and shall be applied first to the payment of all accrued and unpaid interest and
then to the payment of principal. Prepayment of the principal balance of this
Note, together with all accrued and unpaid interest on the portion of principal
so prepaid, may be made in whole or in part at any time without penalty.
4. Events of Acceleration. The entire unpaid principal balance of this
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Note, together with all accrued and unpaid interest, shall become immediately
due and payable prior to the specified due date of this Note upon the occurrence
of one or more of the following events:
A. the failure of the Maker to pay any installment of principal or
accrued interest under this Note when due and the continuation of such
default for more than thirty (30) days; or
B. the expiration of the thirty (30)-day period following the date the
Maker ceases for any reason to remain in the employ of the Corporation; or
C. the insolvency of the Maker, the commission of any act of
bankruptcy by the Maker, the execution by the Maker of a general assignment
for the benefit of creditors, the filing by or against the Maker of any
petition in bankruptcy or any petition
1.
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for relief under the provisions of the Federal bankruptcy act or any other
state or Federal law for the relief of debtors and the continuation of such
petition without dismissal for a period of thirty (30) days or more, the
appointment of a receiver or trustee to take possession of any property or
assets of the Maker or the attachment of or execution against any property
or assets of the Maker; or
D. the occurrence of any event of default under the Stock Pledge
Agreement securing this Note or any obligation secured thereby.
5. Special Acceleration Event. In the event the Maker sells or otherwise
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transfers for value one or more shares of the 27,000 shares of Corporation's
common stock secured pursuant to the Stock Pledge Agreement described in Section
7 hereof, then any unpaid portion of the principal balance of this Note shall
become immediately due and payable, together with all accrued and unpaid
interest.
6. Employment. The Maker shall be deemed to continue in employment with
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the Corporation for so long as he or she renders services as an employee of the
Corporation or one or more of the Corporation's fifty percent (50%) or more
owned (directly or indirectly) subsidiaries.
7. Security. Payment of this Note shall be secured by a pledge of 27,000
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shares of Corporation's Common Stock with the Corporation pursuant to that
certain Stock Pledge Agreement of even date herewith, in substantially the form
attached hereto as EXHIBIT A. The Maker, however, shall remain personally
liable for payment of this Note and assets of the Maker, in addition to the
collateral under the Stock Pledge Agreement, may be applied to the satisfaction
of the Maker's obligations hereunder.
8. Collection. If action is instituted to collect this Note, the Maker
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promises to pay all costs and expenses (including reasonable attorney fees)
incurred in connection with such action.
9. Waiver. A waiver of any term of this Note, the Stock Pledge Agreement
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or of any of the obligations secured thereby must be made in writing and signed
by a duly-authorized officer of the Corporation and any such waiver shall be
limited to its express terms.
No delay by the Corporation in acting with respect to the terms of this
Note or the Stock Pledge Agreement shall constitute a waiver of any breach,
default, or failure of a condition under this Note, the Stock Pledge Agreement
or the obligations secured thereby.
The Maker waives presentment, demand, notice of dishonor, notice of default
or delinquency, notice of acceleration, notice of protest and nonpayment, notice
of costs, expenses or losses and interest thereon, notice of interest on
interest and diligence in taking any action to collect any sums owing under this
Note or in proceeding against any of the rights or interests in or to properties
securing payment of this Note.
10. Conflicting Agreements. In the event of any inconsistencies between
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the terms of this Note and the terms of any other document related to the loan
evidenced by the Note, the terms of this Note shall prevail.
2.
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11. Governing Law. This Note shall be construed in accordance with the
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laws of the State of California without resort to that State's conflict-of-laws
rules. The parties hereby submit to the exclusive jurisdiction of, and waive any
venue objections against any superior, municipal, or other state court located
in San Diego county or any federal court for the Southern District of California
(San Diego) in any litigation arising under or in connection with this Note. The
parties hereby consent to the exclusive jurisdiction of the above listed courts.
/s/ Antonius Schuh
_________________________________________
MAKER
3.
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Exhibit A
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Stock Pledge Agreement
4.
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SEQUENOM, INC.
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STOCK PLEDGE AGREEMENT
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AGREEMENT made as of this 30th day of November, 2000 by and between Sequenom,
Inc., a Delaware corporation (the "Corporation"), and Antonius Schuh
("Pledgor").
RECITALS
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A. In connection with Corporation extending a loan to Pledgor, Pledgor has
issued that certain promissory note (the "Note") dated November 30, 2000 payable
to the order of the Corporation in the principal amount of two hundred five
thousand one hundred sixty-seven Dollars ($205,167).
B. Such Note is secured by the Pledged Shares (as defined below) and other
collateral upon the terms set forth in this Agreement.
NOW, THEREFORE, it is hereby agreed as follows:
1. Grant of Security Interest. Pledgor hereby grants the Corporation
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a security interest in, and assigns, transfers to and pledges with the
Corporation, the following securities and other property (collectively, the
"Collateral"):
(i) 27,000 shares of Company Common Stock issued in the name of
Pledgor (the "Pledged Shares") delivered to and deposited with the
Corporation as collateral for the Note;
(ii) any and all new, additional or different securities or
other property subsequently distributed with respect to the Pledged Shares
which are to be delivered to and deposited with the Corporation pursuant to
the requirements of Paragraph 3 of this Agreement;
(iii) any and all other property and money which is delivered to
or comes into the possession of the Corporation pursuant to the terms of
this Agreement; and
(iv) the proceeds of any sale, exchange or disposition of the
property and securities described in subparagraphs (i), (ii) or (iii)
above.
2. Warranties. Pledgor hereby warrants that Pledgor is the owner of
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the Collateral and has the right to pledge the Collateral and that the
Collateral is free from all liens, adverse claims and other security interests
(other than those created hereby).
3. Duty to Deliver. Any new, additional or different securities or
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other property (other than regular cash dividends) which may now or hereafter
become distributable with respect to the Collateral by reason of (i) any stock
split, stock dividend, recapitalization, combination of shares, exchange of
shares or other change affecting the Common Stock as a class without the
Corporation's receipt of consideration or (ii) any merger, consolidation or
other
1.
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reorganization affecting the capital structure of the Corporation shall, upon
receipt by Pledgor, be promptly delivered to and deposited with the Corporation
as part of the Collateral hereunder. Any such securities shall be accompanied
by one or more properly-endorsed stock power assignments.
4. Payment of Taxes and Other Charges. Pledgor shall pay, prior to
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the delinquency date, all taxes, liens, assessments and other charges against
the Collateral, and in the event of Pledgor's failure to do so, the Corporation
may at its election pay any or all of such taxes and other charges without
contesting the validity or legality thereof. The payments so made shall become
part of the indebtedness secured hereunder and until paid shall bear interest at
the minimum per annum rate, compounded semi-annually, required to avoid the
imputation of interest income to the Corporation and compensation income to
Pledgor under the Federal tax laws.
5. Shareholder Rights. So long as there exists no event of default
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under Paragraph 10 of this Agreement, Pledgor may exercise all shareholder
voting rights and be entitled to receive any and all regular cash dividends paid
on the Collateral and all proxy statements and other shareholder materials
pertaining to the Collateral.
6. Rights and Powers of Corporation. The Corporation may, without
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obligation to do so, exercise at any time and from time to time one or more of
the following rights and powers with respect to any or all of the Collateral:
(i) subject to the applicable limitations of Paragraph 9,
accept in its discretion other property of Pledgor in exchange for all or
part of the Collateral and release Collateral to Pledgor to the extent
necessary to effect such exchange, and in such event the other property
received in the exchange shall become part of the Collateral hereunder;
(ii) perform such acts as are necessary to preserve and protect
the Collateral and the rights, powers and remedies granted with respect to
such Collateral by this Agreement; and
(iii) transfer record ownership of the Collateral to the
Corporation or its nominee and receive, endorse and give receipt for, or
collect by legal proceedings or otherwise, dividends or other distributions
made or paid with respect to the Collateral, provided and only if there
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exists at the time an outstanding event of default under Paragraph 10 of
this Agreement. Any cash sums which the Corporation may so receive shall be
applied to the payment of the Note and any other indebtedness secured
hereunder, in such order of application as the Corporation deems
appropriate. Any remaining cash shall be paid over to Pledgor.
Any action by the Corporation pursuant to the provisions of this Paragraph
6 may be taken without notice to Pledgor. Expenses reasonably incurred in
connection with such action shall be payable by Pledgor and form part of the
indebtedness secured hereunder as provided in Paragraph 12.
2.
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7. Care of Collateral. The Corporation shall exercise reasonable
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care in the custody and preservation of the Collateral. However, the Corporation
shall have no obligation to (i) initiate any action with respect to, or
otherwise inform Pledgor of, any conversion, call, exchange right, preemptive
right, subscription right, purchase offer or other right or privilege relating
to or affecting the Collateral, (ii) preserve the rights of Pledgor against
adverse claims or protect the Collateral against the possibility of a decline in
market value or (iii) take any action with respect to the Collateral requested
by Pledgor unless the request is made in writing and the Corporation determines
that the requested action will not unreasonably jeopardize the value of the
Collateral as security for the Note and other indebtedness secured hereunder.
8. Transfer of Collateral. In connection with the transfer or
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assignment of the Note (whether by negotiation, discount or otherwise), the
Corporation may transfer all or any part of the Collateral, and the transferee
shall thereupon succeed to all the rights, powers and remedies granted the
Corporation hereunder with respect to the Collateral so transferred. Upon such
transfer, the Corporation shall be fully discharged from all liability and
responsibility for the transferred Collateral.
9. Release of Collateral. Provided all indebtedness secured hereunder
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shall at the time have been paid in full and there does not otherwise exist any
event of default under Paragraph 10, the Pledged Shares, together with any
additional Collateral which may hereafter be pledged and deposited hereunder,
shall be released from pledge and returned to Pledgor in accordance with the
following provisions:
(i) Upon payment or prepayment of principal under the Note,
together with payment of all accrued interest to date on the principal
amount so paid or prepaid, one or more of the Pledged Shares held as
Collateral hereunder shall (subject to the applicable limitations of
Paragraphs 9(iii) and 9(v) below) be released at the time of such payment
or prepayment. The number of the shares to be so released shall be equal to
the number obtained by multiplying (i) the total number of Pledged Shares
held under this Agreement at the time of the payment or prepayment, by (ii)
a fraction, the numerator of which shall be the amount of the principal
paid or prepaid and the denominator of which shall be the unpaid principal
balance of the Note immediately prior to such payment or prepayment. In no
event, however, shall any fractional shares be released.
(ii) Any additional Collateral which may hereafter be pledged
and deposited with the Corporation (pursuant to the requirements of
Paragraph 3) with respect to the Pledged Shares shall be released at the
same time the particular shares of Common Stock to which the additional
Collateral relates are to be released in accordance with the applicable
provisions of Paragraph 9(i).
(iii) Under no circumstances, however, shall any Pledged Shares
or any other Collateral be released if previously applied to the payment of
any indebtedness secured hereunder. In addition, in no event shall any
Pledged Shares or other Collateral be released pursuant to the provisions
of Paragraph 9(i) or 9(ii) if, and to the extent, the fair market value of
the Common Stock and all other Collateral which would otherwise remain in
pledge hereunder after such release were effected would be less than the
unpaid principal and accrued interest under the Note.
3.
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(iv) For all valuation purposes under this Agreement, the fair
market value per share of Common Stock on any relevant date shall be
determined in accordance with the following provisions:
(a) If the Common Stock is at the time traded on the Nasdaq
National Market, the fair market value shall be the closing selling price
per share of Common Stock on the date in question, as such prices are
reported by the National Association of Securities Dealers on the Nasdaq
National Market. If there is no reported closing selling price for the
Common Stock on the date in question, then the closing selling price on the
last preceding date for which such quotation exists shall be determinative
of fair market value.
(b) If the Common Stock is at the time listed on the
American Stock Exchange or the New York Stock Exchange, then the fair
market value shall be the closing selling price per share of Common Stock
on the date in question on the securities exchange serving as the primary
market for the Common Stock, as such price is officially quoted in the
composite tape of transactions on such exchange. If there is no reported
sale of Common Stock on such exchange on the date in question, then the
fair market value shall be the closing selling price on the exchange on the
last preceding date for which such quotation exists.
(c) If the Common Stock is at the time neither listed on
any securities exchange nor traded on the Nasdaq National Market, the fair
market value shall be determined by the Corporation's Board of Directors
after taking into account such factors as the Board shall deem appropriate.
(v) In the event the Collateral becomes in whole or in part comprised
of "margin stock" within the meaning of Section 221.2 of Regulation U of
the Federal Reserve Board, then no Collateral shall thereafter be
substituted for any Collateral under the provisions of Paragraph 6(i) or be
released under Paragraph 9(i) or (ii), unless there is compliance with each
of the following additional requirements:
(a) The substitution or release must not increase the
amount by which the indebtedness secured hereunder at the time of such
substitution or release exceeds the maximum loan value (as defined below)
of the Collateral immediately prior to such substitution or release.
(b) The substitution or release must not cause the amount
of indebtedness secured hereunder at the time of such substitution or
release to exceed the maximum loan value of the Collateral remaining after
such substitution or release is effected.
(c) For purposes of this Paragraph 9(v), the maximum loan
value of each item of Collateral shall be determined on the day the
substitution or release is to be effected and shall, in the case of the
shares of Common Stock and any additional Collateral (other than margin
stock), equal the good faith loan value thereof (as defined in
4.
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Section 221.2 of Regulation U) and shall, in the case of all margin stock
(other than the Common Stock), equal fifty percent (50%) of the current
market value of such stock.
10. Events of Default. The occurrence of one or more of the
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following events shall constitute an event of default under this Agreement:
(i) the failure of Pledgor to pay, when due under the Note, any
installment of principal or accrued interest; or
(ii) the occurrence of any other acceleration event specified in
the Note; or
(iii) the failure of Pledgor to perform any obligation imposed
upon Pledgor by reason of this Agreement; or
(iv) the breach of any warranty of Pledgor contained in this
Agreement.
Upon the occurrence of any such event of default, the Corporation may, at
its election, declare the Note and all other indebtedness secured hereunder to
become immediately due and payable and may exercise any or all of the rights and
remedies granted to a secured party under the provisions of the Delaware Uniform
Commercial Code (as now or hereafter in effect), including (without limitation)
the power to dispose of the Collateral by public or private sale or to accept
the Collateral in full payment of the Note and all other indebtedness secured
hereunder.
Any proceeds realized from the disposition of the Collateral pursuant to
the foregoing power of sale shall be applied first to the payment of expenses
incurred by the Corporation in connection with the disposition, then to the
payment of the Note and finally to any other indebtedness secured hereunder.
Any surplus proceeds shall be paid over to Pledgor. However, in the event such
proceeds prove insufficient to satisfy all obligations of Pledgor under the
Note, then Pledgor shall remain personally liable for the resulting deficiency.
11. Other Remedies. The rights, powers and remedies granted to the
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Corporation pursuant to the provisions of this Agreement shall be in addition to
all rights, powers and remedies granted to the Corporation under any statute or
rule of law. Any forbearance, failure or delay by the Corporation in exercising
any right, power or remedy under this Agreement shall not be deemed to be a
waiver of such right, power or remedy. Any single or partial exercise of any
right, power or remedy under this Agreement shall not preclude the further
exercise thereof, and every right, power and remedy of the Corporation under
this Agreement shall continue in full force and effect unless such right, power
or remedy is specifically waived by an instrument executed by the Corporation.
12. Costs and Expenses. All costs and expenses (including reasonable
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attorneys fees) incurred by the Corporation in the exercise or enforcement of
any right, power or remedy granted it under this Agreement shall become part of
the indebtedness secured hereunder and shall constitute a personal liability of
Pledgor payable immediately upon demand and bearing interest until paid at the
minimum per annum rate, compounded semi-annually, required to avoid the
imputation of interest income to the Corporation and compensation income to
Pledgor under the Federal tax laws.
5.
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13. Applicable Law. This Agreement shall be governed by and
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construed in accordance with the laws of the State of California without resort
to that State's conflict-of-laws rules. The parties hereby submit to the
exclusive jurisdiction of, and waive any venue objections against any superior,
municipal, or other state court located in San Diego county or any federal court
for the Southern District of California (San Diego) in any litigation arising
under or in connection with this Stock Pledge Agreement. The parties hereby
consent to the exclusive jurisdiction of the above listed courts.
14. Successors. This Agreement shall be binding upon the Corporation
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and its successors and assigns and upon Pledgor and the executors, heirs and
legatees of Pledgor's estate.
15. Severability. If any provision of this Agreement is held to be
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invalid under applicable law, then such provision shall be ineffective only to
the extent of such invalidity, and neither the remainder of such provision nor
any other provisions of this Agreement shall be affected thereby.
IN WITNESS WHEREOF, this Agreement has been executed by Pledgor and the
Corporation as of November 30, 2000.
PLEDGOR
/s/ Antonius Schuh
_____________________________________
Antonius Schuh
Address:____________________________
____________________________________
AGREED TO AND ACCEPTED BY:
SEQUENOM, INC.
By: /s/ Stephen L. Zaniboni
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Title: CEO
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Dated as of November 30, 2000
6.
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ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, __________________ hereby sell(s), assign(s) and
transfer(s) unto Sequenom, Inc. (the "Corporation"),_________________________
(____) shares of the Common Stock of the Corporation standing in his name on the
books of the Corporation represented by Certificate No._______ herewith and
do(e)s hereby irrevocably constitute and appoint___________________ Attorney to
transfer the said stock on the books of the Corporation with full power of
substitution in the premises.
Dated:___________________
Signature:_______________________________