Exhibit 10.42
PLACEMENT AGENT
AGREEMENT
Alien Technology Corporation, a
California corporation (the “ Company ”), hereby
engages Advanced Equities, Inc., an Illinois corporation (“
PA ”), to assist the Company in obtaining financing
through a private placement of the Company’s Series G
Preferred Stock described in the attached Exhibit B (the
“ Financing ”) as follows:
1.
Services.
(a) PA shall offer participation in
the Financing to potential investors which PA reasonably believes
are “accredited investors” as defined by Regulation D.
Any potential investor in the Financing first introduced by PA to
Company will be set forth on Exhibit A (each, a “
Qualified Investor ”).
(b) PA acknowledges that
(i) the Company is free to contact potential investors
directly and engage other agents on its behalf, (ii) the
Company may determine, in its sole discretion, whether to accept an
offered investment by a Qualified Investor and (iii) the
Company is not obligated to compensate PA for investments offered
to the Company that the Company does not accept. However, the
Company is obligated to accept investments in the Financing in the
aggregate amount up to $12 million from Qualified Investors that
(x) have completed the suitability questionnaire attached as
Exhibit C and (y) the Company determines, in its
reasonable discretion based on such suitability questionnaires, are
accredited investors.
2.
Compensation.
(a) Subject to the limitations in
Exhibit A , the Company shall pay PA, as compensation for
the services provided by PA hereunder, a fee (the “
Fee ”) equal to 5% of all funds invested, on or before
April 30, 2004, by Qualified Investors in the Financing. In
addition, the Company will also issue warrants to PA in accordance
with the Warrant Agreement attached as Exhibit D.
(b) The Warrant Agreement will be
exercisable for that number of shares of Series G Preferred Stock
equal to the product of: (i) the number of shares of Series G
Preferred Stock sold in the Financing to Qualified Investors, and
(ii) (x) 0.05 for shares sold on or before March 31,
2004, (y) 0.04 for shares sold on or before April 30,
2004 and (z) 0.00 for shares sold after April 30, 2004.
In the event Company accepts investments in the Financing pursuant
to Section 1(b) from Qualified Investors who have committed
subscriptions in the aggregate amount of $10 million or more
by March 31, 2004, but Company elects to close on such
investments after March 31, 2004, PA will nevertheless be
entitled to receive 5% warrant coverage on such portion of such
investment amount if and when Company closes on such
investment.
3. Term.
(a) Term. Unless and until
terminated as set forth herein, this Agreement will continue in
full force and effect for an initial term expiring at the earlier
of: (i) the final closing of the Financing; or
(ii) April 30, 2004.
(b) Renewal. Upon expiration
of this Agreement pursuant to Section 3(a)(ii), the
Company may renew this Agreement on a month-to-month basis by
notice to PA at least 30 days prior to such expiration.
(c) Termination. (i) The
Company may terminate this Agreement immediately and without notice
in the event of breach by PA of this Agreement, and
(ii) either party may terminate this Agreement upon 30
days’ prior written notice to the other party for any reason
other than breach by PA of this Agreement. In the event the Company
terminates this Agreement pursuant to Section 3(c)(i),
PA will not be entitled to any unpaid Fee and the Company will be
entitled to all other remedies available under applicable law. In
the event the Company terminates this Agreement pursuant to
Section 3(c)(ii), PA will be entitled to the Fee with
respect to approved Qualified Investors if the Financing closes on
or before April 30, 2004.
4. Performance. In
connection with the performance of its duties under this Agreement,
PA agrees as follows:
(a) PA shall act in a manner
consistent with the instructions of the Company and comply with all
applicable laws, whether foreign or domestic, of each jurisdiction
in which PA proposes to carry on the business contemplated by this
Agreement. PA shall not take any action or omit to take any action
that would cause the Company to violate any law or any applicable
exemption from registration under the Securities Act or the
Securities Exchange Act.
(b) PA shall consecutively number
each copy of the Company’s Confidential Private Placement
Memorandum (the “ Memorandum ”) provided to it
by the Company and shall not distribute copies of any single
numbered Memorandum to more than one potential investor. For each
numbered Memorandum, PA shall keep a record of when and to whom
such Memorandum is given. If PA delivers the Memorandum via
electronic mail, PA shall send the Memorandum in the form of an
Adobe Portable Document Format, cause the cover message to contain
a legend stating that neither the message nor any of its contents
or attachments may be forwarded, copied or disseminated to anyone
other than the recipient’s attorney or a similar advisor
bound by confidentiality, and maintain a copy of the cover
message.
(c) PA shall provide the Company
with a copy of each such record upon request by the Company’s
counsel for compliance with applicable law or in response to
judicial or administrative process.
(d) PA shall not make any untrue
statement of a material fact or omit to state any fact necessary to
make any statement made not misleading. PA shall provide
information regarding the Company only as contained in the
Memorandum.
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(e) PA shall not engage in any form
of general solicitation or general advertising. For example PA
shall not mention the Company in any public medium without the
written permission of the Company.
(f) Before mentioning or sending any
material related to the Company to any potential investor, PA
shall, on the basis of PA’s prior relationship with the
potential offeree, reasonably believe that the potential offeree
is: (x) an “accredited investor” and (y) so
sophisticated and knowledgeable in business and financial matters
that the potential offeree is capable of evaluating the merits and
risks of an investment in the Company.
(g) PA shall cause its employees and
affiliates to comply with all of the foregoing provisions of this
Section 4 .
5. Representations and
Warranties.
(a) PA represents and warrants that
PA has and will maintain during this agreement all licenses,
registrations, permits and other authorizations required for PA to
perform the activities and receive the compensation contemplated by
this Agreement in each jurisdiction in which PA proposes to engage
in such activities. In particular, but without limiting the
generality of the foregoing, PA is and will be duly licensed or
registered as a broker dealer or registered representative of a
broker dealer under the Exchange Act and under the laws of each
jurisdiction requiring such licensing or registration.
(b) The Company represents and
warrants that the Memorandum, as amended or supplemented by any
other written materials delivered to a Qualified Investor before
the Company accepts that Qualified Investor’s investment,
contains and will contain no misrepresentation of a material fact,
and does not and will not omit a material fact necessary to make
the statements therein not misleading in light of the circumstances
under which they were made, provided that PA has promptly
transmitted to any Qualified Investor whose proposed investment the
Company has not yet accepted a copy of any such amendment or
supplement to the Memorandum.
6. Indemnification
.
(a) The Company agrees to indemnify
and hold harmless PA, it
