Exhibit 10.18
PLACEMENT AGENT AGREEMENT
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December 19, 2001
Sanders Morris Harris Inc.
3100 Chase Tower
Houston, Texas 77002
Dear Sirs:
1. Introductory. TurboChef Technologies, Inc., a Delaware corporation
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(the "Company"), proposes to sell up to 1,500,000 shares(the "Shares")of common
stock, $.01 par value ("Common Stock"), of the Company at a purchase price of
$3.38 per Share.
2. Representations and Warranties of the Company. The Company
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represents, warrants, and agrees that:
(i) All reports and statements required to be filed by the
Company under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the rules and regulations thereunder, due at or
prior to the date of this Agreement have been made. Such filings,
together with all documents incorporated by reference therein, are
referred to as "Exchange Act Documents." Each Exchange Act Document, as
amended, conformed in all material respects to the requirements of the
Exchange Act and the rules and regulations thereunder, and no Exchange
Act Document, as amended, at the time each such document was filed,
included any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading.
(ii) The audited financial statements, together with the
related notes of the Company at December 31, 2000 and 1999, included in
the Company's Annual Report on Form 10-K for the year ended December
31, 2000, and for the years then ended, the unaudited financial
statements of the Company at September 30, 2001, and for the nine
months then ended, included in the Company's Quarterly Report on Form
10-Q for the quarter ended September 30, 2001 (collectively, the
"Company Financial Statements"), fairly present in all material
respects, on the basis stated therein and on the date thereof, the
financial position of the Company at the respective dates therein
specified and its results of operations and cash flows for the periods
then ended. To the best knowledge of the Company, such statements and
related notes have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis except as expressly
noted therein.
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(iii) Except as disclosed on Schedule 2(iii), subsequent to
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September 30, 2001, the Company has not incurred any material
liabilities or obligations, direct or contingent, except in the
ordinary course of business, and there has not been any material
adverse change, or to the knowledge of the Company, any development
involving a prospective material adverse change (so far as the Company
may now foresee), in the condition (financial or otherwise), business,
or results of operations of the Company or any change in the capital or
increase in the long-term debt of the Company, nor has the Company
declared, paid, or made any dividend or distribution of any kind on its
capital stock.
(iv) All action required to be taken by the Company as a
condition to the due and proper authorization, issuance, sale, and
delivery of the Shares to subscribers therefor in accordance with the
terms of this Agreement has been, or prior to the Closing Date (as
herein defined), will have been taken; and upon the payment of the
consideration for the Shares specified herein the Shares will be duly
and validly issued, fully paid, and non-assessable with no personal
liability attaching to the ownership thereof and free and clear of all
liens imposed by or through the Company.
(v) The Company has been duly organized and is validly
existing and in good standing as a corporation under the laws of the
State of Delaware, with requisite corporate power and authority to own
or lease its properties and to conduct its business as described in the
Exchange Act Documents; the Company is duly qualified to do business
and in good standing as a foreign corporation in all other
jurisdictions in which its ownership or leasing of properties, or the
conduct of its business requires or may require such qualification
except where the failure to be so qualified would not have a material
adverse effect on the Company. The Company has complied in all material
respects with all material laws, rules, regulations, applicable to the
Company's business, operations, properties, assets, products, and
services, and the Company is in possession of and operating in
compliance with all material permits, licenses, and other
authorization, required to conduct its business as currently conducted.
(vi) The authorized capital stock of the Company consists of
50,000,000 shares of Common Stock, $.01 par value, of which 16,900,355
shares were issued and outstanding as of the date hereof, and 5,000,000
shares of preferred stock, $1.00 par value, of which 21,000 shares of
7% convertible preferred stock 30,000 shares of 8% Series B convertible
preferred stock and 10,000 shares of 8% Series C convertible preferred
stock are issued and outstanding as of the date hereof, and the
designations, powers, preferences, rights, qualifications, limitations,
and restrictions in respect of each class and series of authorized
capital stock of the Company as set forth in the Company's certificate
of incorporation will be valid, binding and enforceable, and in
accordance with all applicable laws. Except for this Agreement, or as
described on Schedule 2(vi), (a) there is no commitment by the Company
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to issue any shares of capital stock, subscriptions, warrants, options,
convertible securities, or
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other similar rights to purchase or receive Company securities or to
distribute to the holders of any of its equity securities any evidence
of indebtedness, cash, or other assets, (b) the Company is under no
obligation (contingent or otherwise) to purchase, redeem, or otherwise
acquire any of its equity or debt securities or any interest therein or
except with respect to its outstanding preferred stock to pay any
dividend or make any other distribution in respect thereof, and (c) to
the best of the Company's knowledge there are no voting trusts or
similar agreements, stockholders' agreements, pledge agreements,
buy-sell agreements, rights of first refusal, preemptive rights, or
proxies relating to any securities of the Company. Except as set forth
in the Exchange Act Documents, and to the best knowledge of the
Company, no person holds of record or beneficially, 5% or more of the
outstanding shares of the capital stock of the Company. All outstanding
securities of the Company were issued in compliance with applicable
Federal and state securities laws.
(vii) Except as disclosed in the Exchange Act Documents and as
described on Schedule 2(vii), there is no material pending or, to the
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knowledge of the Company, threatened (a) action, suit, claim,
proceeding, or investigation against or affecting the Company, at law
or in equity, or before or by any Federal, state, municipal, or other
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign (each, a "Governmental Body"), (b)
arbitration proceeding against or affecting the Company, (c)
governmental inquiry against or affecting the Company, or (d) any
action or suit by or on behalf of the Company pending or threatened
against others.
(viii) The Company is not in violation of its certificate of
incorporation or bylaws, or in material default, or with the giving of
notice or lapse of time or both, would be in material default, in the
performance of any material obligation, agreement, or condition
contained in any lease, license, material contract, indenture, or loan
agreement or in any bond, debenture, note, or any other evidence of
indebtedness, except for such defaults as would not have a material
adverse effect on the Company. The execution, delivery and performance
of this Agreement, the incurrence of the obligations herein, the
issuance, sale, and delivery of the Shares and the consummation of the
transactions contemplated herein, have been duly authorized by all
requisite corporate action on the part of the Company and will not (a)
conflict with or result in a breach of, or default under, the
certificate of incorporation or bylaws of the Company, or any material
loan agreement, mortgage, deed of trust, indenture, or other agreement
or instrument to which the Company is a party or by which it is bound,
except to the extent that the same have been, or prior to the Closing
Date will be, waived or cured, or any law, statute, order, rule,
administrative regulation, or decree of any court, or governmental
agency or body having jurisdiction over the Company or its properties,
or (b) result in the creation or imposition of any material lien,
charge, claim, or encumbrance upon any property or asset of the
Company.
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(ix) There are no pre-emptive rights or other rights to
subscribe for or to purchase, or any restriction upon the voting or
transfer of, any such shares of Common Stock pursuant to the Company's
certificate of incorporation, bylaws, or any agreement or other
instrument to which the Company is a party. Except as disclosed on
Schedule 2(x), the issuance of the Shares is not subject to any
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preemptive right of any stockholder of the Company or to any right of
first refusal or other right in favor of any person.
(x) This Agreement has been duly and validly authorized,
executed and delivered by or on behalf of the Company and constitutes a
legal, valid, and binding obligation of the Company enforceable against
the Company in accordance with its terms, except as such enforceability
may be limited except as limited by (i) applicable bankruptcy,
insolvency, reorganization, moratorium, and other laws of general
application affecting enforcement of creditors' rights generally, and
(ii) laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies and except as
enforceability of the indemnity and contribution provisions contained
in Section 7 hereof may be limited by applicable law or principles of
public policy.
(xi) Except where such failure would not have a material
adverse effect on the business, assets, results of operation, or
condition of the Company, the Company has good and valid title to all
of its assets. All of the Company's tangible personal property has been
maintained in accordance with generally accepted industry practice and
is, in all material respects, in good operating condition and repair,
ordinary wear and tear excepted. All leased personal property is, in
all material respects, in the condition required of such property by
the terms of the lease applicable thereto, and all such leases are in
full force and effect and have not been modified or amended, and no
party thereto is in default in any material respect thereunder. Except
as otherwise stated in the Exchange Act Documents (including the
financial statements and notes thereto included therein) the Company
has good title, free and clear of all liens and encumbrances to all of
the personal property referred to in the Exchange Act Documents as
being owned by it except liens and encumbrances that are not material
in the aggregate and do not materially interfere with the conduct of
the business of the Company.
(xii) No consent, approval, authorization or order of any
court or governmental authority or agency is required for the
consummation by the Company of the transactions contemplated by this
Agreement, except such as may be required by the National Association
of Securities Dealers, Inc. (the "NASD"), the Securities Act of 1933,
as amended (the "Act"), or the rules and regulations thereunder or
state securities or Blue Sky laws.
(xiii) Except as would not have a material adverse effect on
the business, assets, results of operation, or condition of the
Company, the Company has filed, or caused to be filed, on a timely
basis, all tax returns (including payroll,
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unemployment, and other taxes related to its employees and independent
contractors) required to be filed with any Governmental Body and has
paid or caused to be paid all taxes, levies, assessments, tariffs,
duties or other fees imposed, assessed, or collected by any
Governmental Body that may have become due and payable pursuant to
those tax returns or otherwise. No deficiency assessment with respect
to or proposed adjustment of any of the Company's Federal, state,
municipal, or local tax returns has occurred or, to the Company's
knowledge, is threatened. There has been no tax lien imposed by any
Governmental Body outstanding against the Company's assets or
properties, except the lien for current taxes not yet due. The charges,
accruals, and reserves on the books of the Company with respect to
taxes for all fiscal periods are adequate, in the opinion of the
Company, and the Company does not know of any actual or proposed tax
assessment for any fiscal period or of any basis therefor against which
adequate reserves have not been set up. The Company has not been
advised that any Federal income tax return of the Company has been, or
will be, examined or audited by the Internal Revenue Service.
(xiv) The Common Stock is registered pursuant to Section 12(g)
of the Exchange Act and is listed for quotation on the Nasdaq Stock
Market.
3. Representations and Warranties of Sanders Morris Harris Inc. You
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represent and warrant to, and agree with, the Company that:
(i) You have been duly organized and are validly existing and
in good standing as a corporation under the laws of the State of Texas,
with power and authority (corporate and other) to perform your
obligations under this Agreement; you are a broker-dealer registered
and in good standing under the Exchange Act and under the securities or
Blue Sky laws of each state in which the Shares are being offered or
sold by you, and you are a member in good standing of the NASD; you are
in possession of and operating in compliance with all authorizations,
licenses, permits, consents, certificates, and orders required for the
performance of your duties under this Agreement, and your performance
of your duties hereunder will be in compliance with all applicable
laws, including state securities and Blue Sky laws.
(ii) There are no legal or governmental proceedings pending to
which you are a party or of which any of your properties is the subject
or, to your knowledge, threatened, which, if determined adversely to
you, would individually or in the aggregate materially and adversely
affect your ability to perform your obligations under this Agreement.
(iii) No consent, approval, authorization or order of any
court or governmental authority or agency is required for the
performance by you of your obligations under this Agreement, except
such as may be required by the NASD or under Regulation D or state
securities or Blue Sky laws.
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(iv) You have duly and validly authorized, executed and
delivered this Agreement and this Agreement constitutes your legal,
valid, and binding obligation enforceable against you in accordance
with its terms, except as such enforceability may be limited except as
limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium, and other laws of general application affecting enforcement
of creditors' rights generally, and (ii) laws relating to the
availability of specific performance, injunctive relief, or other
equitable remedies and except as enforceability of the indemnity and
contribution provisions contained in Section 7 may be limited by
applicable law or principles of public policy.
4. Offering and Sale of the Shares. (a) On the basis of the
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representations, warranties, and covenants herein contained, but subject to the
terms and upon the conditions herein set forth, you are hereby appointed the
exclusive selling agent of the Company during the term herein specified (the
"Offering Period") for the purpose of finding subscribers for up to 1,500,000
Shares, on a best-efforts basis for the account of the Company through a private
offering (the "Offering") to an unlimited number of "accredited investors" (as
such term is defined in Rule 501 of Regulation D). Subject to the performance by
the Company of all its obligations to be performed hereunder, and to the
completeness and accuracy of all the representations and warranties contained
herein, you hereby accept such agency and agree on the terms and conditions
herein set forth to use your best efforts during the Offering Period to find
subscribers for up to 1,500,000 Shares at a price of $ 3.38 per share. Your
agency hereunder, which is terminable as provided in Section 10 hereof, shall
terminate at 11:59 p.m., Houston, Texas time, on December 31, 2001; provided
that such termination date (the "Termination Date") may be extended by mutual
written agreement of the parties.
(b) Each subscriber must complete and execute a copy of the
Subscription Agreement, in the form attached as Exhibit A hereto. Upon receipt,
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you shall hold all such Subscription Agreements and subscription funds in
safekeeping.
(c) On or before the Closing Date (as defined below) you shall promptly
notify the Company in writing of the aggregate amount of Shares for which you
have received subscriptions (the "Notice Date"). Payment of the purchase price
for the Shares for which you have found subscribers, and delivery, with respect
to each subscriber for Shares, of a copy of a Subscription Agreement signed by
such subscriber, shall then be made at the offices of Sanders Morris Harris, 600
Travis Street, Suite 3100, Houston, Texas 77002 or such other place as shall be
agreed upon between you and the Company, at 10:00 A.M., Houston Time, no later
than the fifth full business day after the Notice Date, or such other day and
time (not later than ten business days thereafter) as shall be agreed upon
between you and the Company (the "Closing Date").
(d) As compensation for your services, a cash commission will be paid
to you with respect to subscriptions received by you as to which the payments
and deliveries provided for in this Section 4 are made at the Closing Date equal
to 7.0% of the purchase price of each Share. Such commissions shall be paid to
you on the Closing Date by bank
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wire transfer payable in immediately available funds. In addition, the Company
agrees to reimburse you for your reasonable expenses in accordance with Section
6 hereof.
(e) Neither you nor the Company shall, directly or indirectly, pay or
award any finder's fees, commissions or other compensation to any person engaged
by a potential investor for investment advice as an inducement to such advisor
to advise the purchase of the Shares; provided, however, that normal sales
commissions payable to a registered broker-dealer or other properly licensed
person for selling the Shares shall not be prohibited hereby.
(f) You will prepare and file such statements and reports as are or may
be required to enable the Shares to be qualified for sale under the securities
laws of such jurisdictions as you may designate.
(g) You will not make a general solicitation with respect to the
Offering.
(h) The Company will issue to you on the Closing Date a Common Stock
purchase warrant (the "Agent's Warrant") in substantially the form attached
hereto as Exhibit B granting you the right to purchase from the Company for a
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period of five years after the Closing Date, the number of shares of Common
Stock equal to 8% of the shares of Common Stock sold by you, at a purchase price
of $4.10 per share.
5. Covenants and Agreements of the Company. The Company covenants and
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agrees with you that:
(a) It will not, prior to the Closing Date, incur any material
liability or obligation, direct or contingent, or enter into any material
transaction, other than in the ordinary course of business. It will not, prior
to the Closing Date, declare or pay any dividend or make any distribution on the
Common Stock payable to stockholders of record on a date prior to the Closing
Date or declare or pay any bonuses to employees or increase any the compensation
of any officers of the Company without your prior written consent except normal
and customary bonuses and increases.
(b) It will cooperate with you to enable the Shares to be qualified for
sale under the securities laws of such jurisdictions as you may designate,
subject to approval by the Company, and at your request will make such
applications and furnish such information as may be required of it for that
purpose; provided, however, that you and the Company shall first determine
whether an exemption from registration other than the Uniform Limited Offering
Exemption (ULOE) or a similar exemption is available in each such jurisdiction
and the Company shall not be required to qualify to do business or to file a
general consent to service of process in any such jurisdiction. It will, from
time to time, prepare and file such statements and reports as are or may be
required to continue such qualifications in effect for so long a period as you
may reasonably request for the distribution of the Shares.
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(c) It will file all reports required by Regulation D with regard to
sales of the Shares and use of the proceeds therefrom; provided that you provide
all relevant information to the Company in writing as to purchasers of the
Shares required for such filings.
(d) It will not offer or sell any securities of the Company that are of
the same or a similar class as the Shares for a period of six months after the
Closing Date, other than those offers or sales of securities under an employee
benefit plan as defined in Rule 405 under the Act or in connection with an
acquisition of assets or another business by the Company if such offering will
be integrated with the offering of the Shares pursuant to this Agreement for
purposes of the exemptions under Regulation D, so as to invalidate the exemption
from registration relied on to offer and sell the Shares.
6. Payment of Expenses. If this Agreement becomes effective and the
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transactions contemplated by this Agreement are consummated, the Company will
pay (1) all reasonable expenses incident to the performance of the obligations
of the Company under this Agreement, including (but not limited to) all expenses
and taxes incident to the sale and delivery of the Shares, all expenses incident
to the printing of copies any "Blue Sky" memorandum and this Agreement and
furnishing the same to you, all filing and printing fees and expenses (including
legal fees and disbursements of your counsel not to exceed $5,000) directly
incurred in connection with qualification of the Shares for sale under the laws
of such jurisdictions as you may designate, the fees and disbursements of
counsel and accountants for the Company, (2) all of your reasonable
out-of-pocket expenses (including fees and disbursements of your counsel,
travel, and related expenses incurred in connection with this Agreement and the
Offering) incurred in connection with this Agreement, preparing to market, and
marketing the Shares, and (3) the reasonable legal fees and expenses incurred in
connection with the negotiation, execution, and delivery of Subscription
Agreements and the related agreements of counsel to the subscribers for Shares,
up to a maximum of $5,000.
7. Indemnification and Contribution. (a) The Company agrees to
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indemnify and hold harmless you and each person, if any, (who controls you
within the meaning of the Act), against any losses, claims, damages,
liabilities, or expenses (including, unless the Company elects to assume the
defense as hereinafter provided, the reasonable cost of investigating and
defending against any claims therefor and counsel fees incurred in connection
therewith), joint or several, which (1) are based on the ground or alleged
ground that any Exchange Act Document, includes or allegedly includes an untrue
statement of material fact or omits to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading, or (2) arise out of the Company's breach of a
representation or warranty or covenant or agreement contained in this Agreement;
provided that in no case is the Company to be liable with respect to any claims
made against you, or any such controlling person unless you or such controlling
person shall have notified the Company in writing within a reasonable time after
the summons or other first legal process giving information of the nature of the
claim shall have been served upon you or such controlling person, but failure to
notify the Company of any such claim shall not relieve it
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from any liability that it may have to you or such controlling person otherwise
than on account of the indemnity agreement contained in this paragraph. The
Company will be entitled to participate at its own expense in the defense, or if
it so elects, to assume the defense of any suit brought to enforce any such
liability, but, if the Company elects to assume the defense, such defense shall
be conducted by counsel chosen by it and reasonably acceptable to you. In the
event the Company elects to assume the defense of any such suit and retain such
counsel, you or such controlling person or persons, defendant or defendants in
the suit, may retain additional counsel but shall bear the fees and expenses of
such counsel unless (i) the Company shall have specifically authorized the
retaining of such counsel or (ii) the parties to such suit include you or such
controlling person or persons, and the Company and you or such controlling
person or persons have been advised by counsel that one or more material legal
defenses may be available to you or them that may not be available to the
Company in which case the Company shall not be entitled to assume the defense of
such suit notwithstanding its obligation to bear the reasonable fees and
expenses of such counsel. In no event shall the Company be liable for the fees
and expenses of more than one counsel for all indemnified parties in connection
with any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. The
Company shall not be required to indemnify any person for any settlement of any
such claim effected without the Company's consent which shall not be
unreasonably withheld. This indemnification obligation will be in addition to
any primary liability that the Company might otherwise have.
(b) You agree to indemnify and hold harmless the Company, each of the
Company's officers, directors, and each other person, if any, who controls the
Company within the meaning of the Act, against any losses, claims, damages,
liabilities, or expenses (including, unless you elect to assume the defense, the
reasonable cost of investigating and defending against any claims therefor and
counsel fees incurred in connection therewith), joint or several, which (1)
arise out of any acts or omissions by you that cause the offering to involve a
public offering under the Act or your failure to be properly licensed to sell
the Shares or (2) arise out of your breach of a representation or warranty or
covenant or agreement contained in this Agreement; provided, however, that in no
case are you to be liable with respect to any claims made against the Company or
any such person against whom the action is brought unless the Company or such
person shall have notified you in writing within a reasonable time after the
summons or other first legal process giving information of the nature of the
claim shall have been served upon the Company or such person, but failure to
notify you of such claim shall not relieve you from any liability that you may
have to the Company or such person otherwise than on account of the indemnity
agreement contained in this paragraph. You shall be entitled to participate at
your expense in the defense, or if you so elect, to assume the defense of any
suit brought to enforce any such liability, but, if you elect to assume the
defense, counsel chosen by you and reasonably acceptable to the Company shall
conduct such defense. In the event that you elect to assume the defense of any
such suit and retain such counsel, the Company, said officers and directors and
any person or persons, defendant or defendants in the suit, may retain
additional counsel but shall bear the fees and expenses of such counsel unless
(i) you shall have specifically authorized the
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retaining of such counsel or (ii) the parties to such suit include you or such
controlling person or persons, and the Company and you or such controlling
person or persons have been advised by counsel that one or more material legal
defenses may be available to the Company that may not be available to you or
them in which case you shall not be entitled to assume the defense of such suit
notwithstanding your obligation to bear the reasonable fees and expenses of such
counsel. You shall not be liable to indemnify any person for any settlement of
any such claim effected without your or its consent which consent shall not be
unreasonably withheld. This indemnification obligation will be in addition to
any primary liability that you might otherwise have.
(c) If the indemnification provided for in this Section 7 is
unavailable, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses (or actions in respect thereof) in such proportion as is
appropriate to reflect not only the relative benefits received by the Company on
one hand and you on the other from the offering, but also the relative fault of
the Company on the one hand and you on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities, or expenses (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand and you on the other, shall be deemed to be in the same
proportion as the total maximum net proceeds from the offering (before deducting
expenses) received by the Company, bear to the total selling commissions
received by you. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission, and whether a party breached a representation or warranty or covenant
or agreement contained in this Agreement. The Company and you agree that it
would not be just and equitable if contribution were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above. The amount paid or payable by an
indemnified party as a result of the losses, claims, damages, liabilities or
expenses (or actions in respect thereof) referred to above shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such claim.
Notwithstanding the provisions of this paragraph (c), you shall not be required
to contribute any amount in excess of 7% of the gross proceeds of the offering
less the amount of any damages which you have otherwise been required to pay by
reason of an untrue or alleged untrue statement or omission or alleged omission
by the Company. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
8. Survival of Indemnities, Representations, Warranties, etc. The
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respective indemnities, covenants, agreements, representations, warranties, and
other statements of you and the Company as set forth in this Agreement or made
by them respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any
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investigation made by or on behalf of you, the Company or any of the officers or
directors of the Company or any controlling person, and shall survive delivery
of and payment for the Shares.
9. Conditions of Your Obligations. Your obligations hereunder are
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subject to the accuracy in all material respects at and (except as otherwise
stated herein) as of the date hereof and at and as of the Closing Date, of the
representations and warranties made herein by the Company, to the compliance in
all material respects at and as of the Closing Date by the Company with its
covenants and agreements herein contained and other provisions hereof to be
satisfied at or prior to the Closing Date and to the following additional
conditions:
(a) You shall not have stated in writing prior to the Closing Date to
the Company that any Exchange Act Document, or any amendment or supplement
thereto contains an untrue statement of fact which, in your opinion, is
material, or omits to state a fact which, in your opinion, is necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.
(b) You shall have received a certificate, dated the Closing Date, of
the Chief Executive Officer or the President and the chief financial or
accounting officer of the Company to the effect that:
(i) To the best of the knowledge of the signers, the
representations and warranties of the Company in this Agreement are
true and correct in all material respects at and as of the Closing
Date, and the Company has complied in all material respects with all
the agreements and satisfied in all material respects all the
conditions on its part to be performed or satisfied at or prior to the
Closing Date;
(ii) No litigation has been instituted or, to the knowledge of the
Company, threatened against the Company of a character required to be
disclosed in an Exchange Act Document under Item 103 of Regulation S-K
that has not been so disclosed to you; and
(iii) Between the date of this Agreement and the Closing Date,
there has not been any material adverse change, or to the knowledge of
the Company, any development involving a prospective material adverse
change (so far as the Company may now foresee), in the condition
(financial or otherwise), business, or results of operations of the
Company.
(d) The Company shall have furnished to you such additional
certificates as you may have reasonably requested as to compliance at and as of
the Closing Date by it with its covenants and agreements herein contained and
other provisions hereof to be satisfied at or prior to the Closing Date and as
to other conditions to your obligations hereunder.
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(e) There shall not have been any material adverse change in any legal
proceedings or regulatory actions pending or the commencement of similar actions
which, if determined adversely to the Company, would have a material adverse
effect on the condition (financial or otherwise), business, property, or results
of operations of the Company.
If any of the conditions provided for in this Section 9 shall not have
been satisfied when and as required by this Agreement, this Agreement may be
terminated by you by notifying the Company of such termination in writing at or
prior to the Closing Date, but you shall be entitled to waive any of such
conditions.
10. Effective Date. This Agreement shall become effective at 11:00
---------------
A.M., Houston Time, on the date hereof (the "Effective Time").
11. Termination. In the event of any termination of this Agreement
-----------
under this or any other provision of this Agreement, there shall be no liability
of any party to this Agreement to any other party, other than as provided in
Sections 6, 7, and 8.
This Agreement may be terminated after the Effective Time by (i) the
Company for any reason by notice to you and (ii) you by notice to the Company
(A) if at or prior to the Closing Date trading in securities on the New York
Stock Exchange, the American Stock Exchange, or the Nasdaq Stock Market
(collectively, the "Exchanges") shall have been suspended or minimum or maximum
prices shall have been established on either such exchange or stock market, or a
banking moratorium shall have been declared by Texas or United States
authorities (unless such suspension is made pending completion of the sale of
the Shares, at which time, such suspension will be lifted); (B) if at or prior
to the Closing Date there shall have been an outbreak of hostilities between the
United States and any foreign country, or any other insurrection or armed
conflict involving the United States which, in your reasonable judgment, makes
it impracticable or inadvisable to offer or sell the Shares; (C) if there shall
have been any material development or prospective development involving
particularly the business or properties or securities of the Company or the
transactions contemplated by this Agreement, which, in your judgment, makes it
impracticable or inadvisable to offer or deliver the Shares on the terms
contemplated by this Agreement, or (D) if there shall be any material litigation
or regulatory action, pending or threatened against or involving the Company,
which, in your judgment, makes it impracticable or inadvisable to offer or
deliver the Shares on the terms contemplated by this Agreement.
If, and only if, the Company terminates this Agreement after it becomes
effective for any reason (other than your material failure to comply with your
obligations under this Agreement) or the offering fails to close because of the
Company's breach of any representations or warranties contained in this
Agreement or the Company's failure to fulfill its covenants and agreements
contained in this Agreement, the Company shall pay you your actual expenses
incurred as provided in Sections 4(d) and 6 hereof, less the amounts previously
paid to you by the Company, which shall be in addition to all
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amounts previously paid to you, and any amounts payable to you pursuant to
Sections 4(d), 6, or 7 hereof.
In addition, as set forth in Section 4, this Agreement shall terminate at 11:59
p.m., Houston, Texas time, on December 31, 2001; provided that such termination
may be extended by mutual written agreement by both parties.
12. Agreement Concerning Disclosure of Information. You agree to treat
----------------------------------------------
confidentially any information which is furnished to you (or to parties acting
on your behalf) by or on behalf of the Company (the "Information"). You agree
that you will use the Information only for the purposes related to your and your
clients' investment in the Company, and that the Information will be kept
confidential by you and your partners, members, managers, officers, directors,
employees, agents, accountants, attorneys and other affiliates (collectively,
the "Affiliates"), and your attorneys and accountants (collectively, the
"Professionals"), and that you, such Affiliates, or Professionals will not
disclose the Information to any person; provided, however, that the Information
may be disclosed to (a) Affiliates and Professionals who need to know such
Information for the purpose of evaluating or providing services in connection
with the your and your clients' investment in the Company, (b) to any federal or
state regulatory agency and their employees, agents, and attorneys
(collectively, "Regulators") for the purpose of making any filings with
Regulators if disclosure of such Information is required by law (provided that
you advise the Company in writing of the Information to be so disclosed prior to
such filing), and (c) any other person to which the Company consents in writing
prior to any such disclosure.
In the event that you are requested or required (by oral questions,
documents, subpoena, civil investigation, demand, interrogatories, request for
information, or other similar process) to disclose to any person or entity any
information supplied to you, your Affiliates, or your Professionals in the
course of their dealings with the Company or their respective representatives,
you agree that you will provide the Company with prompt notice of such
request(s) within a reasonable time prior to such disclosure so that the Company
may seek an appropriate protective order and/or waiver of compliance with the
provisions of this Agreement. It is further agreed that, if a protective order
is not obtained, or a waiver is not granted hereunder, and you are nonetheless,
in the written opinion of counsel, compelled to disclose information concerning
the Company to any tribunal or else stand liable for contempt or suffer the
censure or penalty, you may disclose such information to such tribunal without
liability hereunder. Prior to making such disclosure, you shall deliver a
written opinion of your counsel to the Company's counsel that disclosure is
compelled by law. You will exercise your best efforts to obtain a protective
order or other reliable assurance that confidential treatment will be accorded
the Information.
13. Notices. All communications hereunder shall be in writing and, if
-------
sent to you shall be mailed, delivered or telegraphed and confirmed to you, at
3100 Chase Tower, Houston, Texas 77002, or if sent to the Company shall be
mailed, delivered or
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telegraphed and confirmed to the Company, at 10500 Metric Drive, Suite 128,
Dallas, Texas 75243, Attention: President.
14. Successors. This Agreement shall inure to the benefit of and be
----------
binding upon you, the Company, and their respective successors and legal
representatives, except that neither the Company nor you may assign or transfer
any of its or your rights or obligations under this Agreement without the prior
written consent of the other. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person other than the persons
mentioned in the preceding sentence any legal or equitable right, remedy or
claim under or in respect of this Agreement, or any provisions herein contained,
this Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such persons and for the benefit of
no other person; except that the representations, warranties, covenants,
agreements and indemnities of the Company contained in this Agreement shall also
be for the benefit of the person or persons, if any, who control you within the
meaning of Section 15 of the Act, and your indemnities shall also be for the
benefit of each officer and director of the Company and the person or persons,
if any, who control the Company within the meaning of Section 15 of the Act.
15. Applicable Law. This Agreement shall be governed by and construed
--------------
in accordance with the laws of the State of Texas.
If the foregoing correctly sets forth our understanding please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
TURBOCHEF TECHNOLOGIES, INC.
By /s/ Jeffrey B. Bogatin
---------------------------
Name: Jeffrey B. Bogatin
------------------------
Title: Chairman & CEO
-----------------------
Accepted and delivered in Houston,
Texas as of the date first above written
SANDERS MORRIS HARRIS INC.
By: /s/ Dean Oakey
-----------------------------
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Schedule 2(iii)
Material Liabilities
--------------------
None
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Schedule 2(vi)
Outstanding Stock Options, Etc.
-------------------------------
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Schedule 2(vii)
Disputes
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In December 1999, TurboChef Technologies, Inc. (the Company) and Tridelta
Industries Inc. (Tridelta) entered into an agreement for the development and
purchase of interface control systems manufactured by Tridelta. This contract
was amended in September 2000. Tridelta currently seeks $116,320.66 in damages,
plus additional lost profits, due to the Company not placing an order for 10,000
control boards, as previously agreed upon per the contract.
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