-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MedWvVUXgnO2dCbZP7kRmzLu0aU/b8LpYWAgKtRPs1wrwcEeyh/IBEM28gQjoY+m 923D+En4phHgra/pq4tpqQ== 0000898430-01-501241.txt : 20010710 0000898430-01-501241.hdr.sgml : 20010710 ACCESSION NUMBER: 0000898430-01-501241 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20010709 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMPCO TECHNOLOGIES INC CENTRAL INDEX KEY: 0000790708 STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLE PARTS & ACCESSORIES [3714] IRS NUMBER: 911039211 STATE OF INCORPORATION: DE FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-63726 FILM NUMBER: 1676837 BUSINESS ADDRESS: STREET 1: 16804 GRIDLEY PLACE CITY: CERRITOS STATE: CA ZIP: 90701 BUSINESS PHONE: 5628606666 MAIL ADDRESS: STREET 1: 16804 GRIDLEY PL CITY: CERRITOS STATE: CA ZIP: 90703 FORMER COMPANY: FORMER CONFORMED NAME: AIRSENSORS INC DATE OF NAME CHANGE: 19920703 S-3/A 1 ds3a.txt AMENDMENT NO. 1 TO FORM S-3 As filed with the Securities and Exchange Commission on July 9, 2001 Registration No. 333-63726 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------- AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT Under The Securities Act Of 1933 ---------------- IMPCO TECHNOLOGIES, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 91-1039211 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.)
---------------- 16804 Gridley Place Cerritos, California 90703 (562) 860-6666 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) ---------------- Robert M. Stemmler President and Chief Executive Officer 16804 Gridley Place Cerritos, California 90703 (562) 860-6666 (Name, address, including zip code, and telephone number, including area code, of agent for service) ---------------- Copies of all communications to be sent to: Michael J. Connell, Esq. Robert S. Kant, Esq. Jonathan F. Atzen, Esq. Howard J. Kern, Esq. Craig S. Mordock, Esq. Scott K. Weiss, Esq. MORRISON & FOERSTER LLP GREENBERG TRAURIG, LLP 555 West Fifth Street 2375 East Camelback Road Los Angeles, California 90013-1024 Phoenix, Arizona 85016 (213) 892-5200 (602) 445-8000
---------------- Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [_] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] ---------------- The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- EXPLANATORY NOTE This Amendment No. 1 to the Registration Statement on Form S-3 is being filed solely for the purpose of filing additional exhibits as indicated in the Exhibit Index included herein. PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution The following is an itemized list of the estimated expenses to be incurred in connection with the offering of the securities being offered hereunder other than underwriting discounts and commissions.
Amount to be paid --------- Registration fee................................................... $ 12,500 NASD filing fee.................................................... 5,500 Printing and engraving expenses.................................... * Legal fees and expenses............................................ * Blue Sky qualification fees and expenses........................... * Accounting fees and expenses....................................... * Transfer Agent and registrar fees.................................. * Miscellaneous...................................................... * -------- Total.......................................................... $825,000 ========
* To be supplied by amendment. Item 15. Indemnification of Directors and Officers Section 145 of the Delaware General Corporation Law (the "DGCL") contains detailed provisions on indemnification of directors and officers against expenses, judgments, fines and amounts paid in settlement, actually and reasonably incurred in connection with legal proceedings. Section 102(a)(7) of the DGCL permits a provision in the certificate of incorporation of each corporation organized thereunder, such as our company, eliminating or limiting, with certain exceptions, the personal liability of a director of the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. Our Certificate of Incorporation eliminates the liability of each of our directors to our stockholders or us for monetary damages for breach of fiduciary duty to the full extent provided by the DGCL, as such law exists or may hereafter be amended. Indemnification applies to any threatened, pending or completed action, suit or proceeding, whether, civil, criminal, administrative or investigative. Indemnification may include all expenses (including attorneys' fees, judgments, fines, ERISA excise taxes and amounts paid in settlement) reasonably incurred by the indemnified person. Item 16. Exhibits and Financial Statement Schedules (a) Exhibits See Exhibit Index. (b) Financial Statement Schedules Schedule II--Valuation And Qualifying Accounts Other schedules are omitted because they are not applicable or because the information is included in the financial statements or the related notes. II-1 Item 17. Undertakings We hereby undertake that: (1) For purposes of determining any liability under the Securities Act of 1933, as amended (the "Securities Act"), each filing of our annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference to this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; (2) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the DGCL, our Certificate of Incorporation or our Bylaws, indemnification agreements entered into between us and our officers and directors, the Underwriting Agreement and all prior underwriting agreements, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue; (3) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by us pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective; and (4) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Cerritos, State of California, on July 6, 2001. IMPCO Technologies, Inc. /s/ William B. Olson By: _________________________________ William B. Olson Chief Financial Officer and Treasurer Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement on Form S-3 to be signed on its behalf by the following persons in the capacities and on the dates indicated.
Signature Title Date --------- ----- ---- /s/ * Chief Executive Officer and July 6, 2001 ____________________________________ Chairman of the Board Robert M. Stemmler (Principal Executive Officer) /s/ William B. Olson Chief Financial Officer and July 6, 2001 ____________________________________ Treasurer (Prinicipal William B. Olson Financial Officer) /s/ * Corporate Controller July 6, 2001 ____________________________________ (Principal Accounting Timothy S. Stone Officer) /s/ * Director July 6, 2001 ____________________________________ Norman L. Bryan /s/ * Director July 6, 2001 ____________________________________ Paul Mlotok /s/ * Director July 6, 2001 ____________________________________ J. David Power III /s/ * Director July 6, 2001 ____________________________________ Don J. Simplot /s/ * Director July 6, 2001 ____________________________________ Douglas W. Toms
/s/ William B. Olson By: __________________________ William B. Olson Attorney-in-Fact II-3 EXHIBIT INDEX
Exhibit Number Exhibit Description ------- ------------------- 1.1* Form of Underwriting Agreement. 2.1 Deed of Sale of Business by and among IMPCO Technologies Pty. Limited, as buyer, and Ateco Automotive Pty. Limited, as seller, dated as of July 1, 1996. (1) 2.2 Deed of Release by and among IMPCO Technologies, Inc. and Ateco Automotive Pty. Limited dated as of July 1, 1996. (1) 2.3 Shareholders Agreement for Gas Parts (NSW) Pty. Limited by and among IMPCO Technologies, Pty. Limited, Gas Parts Pty. Limited and Gas Parts (NSW) Pty. Limited, dated as of July 4, 1996. (1) 4.1 Stockholders' Protection Rights Agreement dated as of June 30, 1999 between IMPCO Technologies, Inc. and ChaseMellon Stockholder Services, L.L.C., as Rights Agreement. (2) 5.1* Opinion of Morrison & Foerster LLP 10.31+ Corporate Alliance Agreement dated June 12, 2001 between Quantum Technologies Worldwide, Inc. and General Motors Corporation. 10.32 Master Technical Development Agreement dated June 12, 2001 between Quantum Technologies Worldwide, Inc. and General Motors Corporation. 10.33 Stock Transfer Agreement dated June 12, 2001 between Quantum Technologies Worldwide, Inc. and General Motors Corporation. 10.34 Registration Rights Agreement dated June 12, 2001 between Quantum Technologies Worldwide, Inc. and General Motors Corporation. 23.1** Consent of Ernst & Young LLP Consent of Morrison & Foerster LLP (included as part of its opinion 23.2* filed as Exhibit 5.1) 24.1** Power of Attorney
- -------- (1) Incorporated by reference Form 8-K/A dated July 1, 1996, and filed as Exhibit Numbers (2.5) through (2.9) thereunder. (2) Incorporated by reference from Form 8-K dated June 30, 1999 and filed as Exhibit (4) thereunder. * To be filed by amendment. ** Previously filed. + Certain information in this exhibit has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. II-4 EX-10.31 2 dex1031.txt CORPORATE ALLIANCE AGREEMENT Exhibit 10.31 NOTE: PORTIONS OF THIS EXHIBIT INDICATED BY "[****]" ARE SUBJECT TO A CONFIDENTIAL TREATMENT REQUEST, AND HAVE BEEN OMITTED FROM THIS EXHIBIT. COMPLETE, UNREDACTED COPIES OF THIS EXHIBIT HAVE BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AS PART OF THIS COMPANY'S CONFIDENTIAL TREATMENT REQUEST. CORPORATE ALLIANCE AGREEMENT This CORPORATE ALLIANCE AGREEMENT ("Agreement") is entered into on June 12, 2001, by and between QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation ("Quantum") and wholly-owned subsidiary of IMPCO Technologies, Inc., a Delaware corporation ("IMPCO"), and GENERAL MOTORS CORPORATION, a Delaware corporation ("GM"). Quantum and GM are sometimes referred to herein, individually, as a "Party," and collectively, as the "Parties." RECITALS A. Quantum designs, develops and manufactures advanced gaseous storage and handling systems and sub-systems for Fuel Cell Systems, for use in transportation, mobile, stationary, portable and infrastructure applications (the "Market"). B. In addition to designing, developing and manufacturing the foregoing systems and sub-systems, Quantum has the capability of integrating them into Fuel Cell Systems and providing installation, permitting, customer service and customer support services (collectively, the "Business"). C. GM designs and develops, among other things, Fuel Cell Systems for which the Business may be applicable. D. The Parties are interested in cooperating with one another and working together to advance and commercialize, on a global basis, the Business in the Market. E. In furtherance of the effort of the Parties to advance and commercialize, on a global basis, the design, development, manufacturing, integration and marketing of Quantum gaseous storage and handling systems in support of GM Fuel Cell Systems, the Parties desire to enter into this Agreement. F. Concurrently with and as a condition to entering into this Agreement, the Parties are entering into a certain Master Technical Development Agreement (the "Development Agreement"), a copy of which is attached hereto as Exhibit "A." G. Also concurrently herewith and as a condition to entering into this Agreement, the Parties are entering into a certain Stock Transfer Agreement ("STA"), a copy of which is attached hereto as Exhibit "B," whereby Quantum agrees to transfer to GM, and GM agrees to acquire, shares of Quantum's Series A common stock, and a certain Registration Rights Agreement ("RRA"), a copy of which is attached hereto as Exhibit "C." -1- H. The Development Agreement, the STA, the RRA, and this Agreement shall together operate to establish the terms of the Parties' corporate alliance. Unless otherwise specifically defined herein, defined terms appearing herein shall have the same meanings ascribed to them in the Development Agreement. I. Following the execution of the agreements referred to in the foregoing Recitals, and before the acquisition of Quantum Series A common stock by GM pursuant to the STA (the "STA Closing"), IMPCO and Quantum intend to effectuate a tax-free spin-off of Quantum in full compliance with all of the requirements of Section 355 of the Internal Revenue Code of 1986, as amended ("IRC"). The Parties hereby acknowledge that the terms set forth in this Agreement and the transactions contemplated thereby are intended in their application to meet the requirements of IRC Section 355, and hereby agree to cooperate with one another and to conduct the transactions contemplated herein in such a manner as to achieve that objective. J. This Agreement shall become effective as of the STA Closing (the "Effective Date"), it being explicitly understood by the Parties that the STA Closing is conditioned upon the above-referenced tax-free spin-off having been consummated. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows: ARTICLE I MATERIALITY OF RECITALS ----------------------- The Parties hereby acknowledge and agree that the foregoing recitals are intended to constitute the agreement of the Parties hereto and are deemed to be a material part of this Agreement. ARTICLE II OBLIGATIONS OF THE PARTIES -------------------------- The Parties wish to enhance, expand and promote the Business for application in the Market and, in furtherance of such purpose, hereby agree as follows: -2- [****] - CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 2.1 Covenants of GM. --------------- (a) Support. GM shall actively support Quantum in the performance of ------- Quantum's duties hereunder and under the Development Agreement by providing Quantum access to the GM customer base for the GM Fuel Cell Systems. (b) Endorsement. GM shall publicly endorse Quantum by using ----------- reasonable efforts to introduce and recommend Quantum to its customer base for the GM Fuel Cell Systems as a source of the Business, and as a recommended partner for the design and supply of gaseous storage and handling systems and sub-systems. (c) Directed Research and Development. In furtherance of the --------------------------------- objectives of this Agreement, GM shall use its expertise and knowledge of the Market to direct such research and development to be performed by Quantum as shall be determined appropriate best to enhance the Business and speed its commercialization in the Market, particularly in the areas of advanced gaseous storage, handling, control and integration with Fuel Cell Systems. It is understood and agreed that the cost of resources committed to be expended by Quantum to perform such directed research and development, as calculated in a manner consistent with Quantum's customary budgeting procedures, shall equal but not exceed the aggregate amount of [****] dollars ($[****]) in any one (1) calendar year unless otherwise mutually agreed by the Parties in writing. (d) Guidance. As part of the collaborative efforts of the Parties -------- under this Agreement, GM shall provide Quantum with guidance in the following areas, among others, to enhance resource and skill sets: 1. The evaluation of future technology, testing procedures and general marketing proposals; 2. Fuel Cell System requirements for steady state and transient operation, and the gaseous storage and handling interface and performance targets to satisfy those requirements; 3. The evaluation of resource and facility needs; and 4. The coordination of personnel and research and development, which may include the sharing or exchange of staff and resources as determined by the Commercial or Technical Teams (as appropriate). -3- [****] - CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 2.2 Covenants of Quantum. -------------------- (a) Affirmative Covenants. --------------------- 1. Quantum shall use all commercially reasonable efforts to comply with the commitment to perform and fund the research and development as directed by GM pursuant to Section 2.1(c) hereof, in accordance with the terms of the Development Agreement. 2. Quantum shall, no later than the Effective Date, cause one (1) individual nominated by GM to be appointed to the Quantum Board of Directors (the "Board") to sit as a voting member of the Board and one (1) individual selected by GM to be appointed to sit on the Board in an "ex officio" non-voting capacity. Thereafter during the term of this Agreement, Quantum shall name one (1) individual nominated by GM to its proposed slate of directors to be presented to the Quantum stockholders for election at the appropriate meetings of stockholders, and GM shall designate a successor for the "ex officio" seat as necessary. 3. Quantum shall use all reasonable efforts to assure that GM shall receive all the benefits of an existing stockholder under any anti-takeover plan or program which Quantum may adopt, be it through amendment of its Certificate of Incorporation and/or its Bylaws to include additional provisions deemed to have an anti-takeover effect, or otherwise. 4. Quantum shall acquire from its parent company, IMPCO, certain intellectual property as shall be agreed upon by the Parties including but not limited to US5775599, US5809970, US5887799, US5775309, US6041762, US6161783 and the foreign counterparts thereof, if any, and shall obtain sufficient rights in any intellectual property retained by IMPCO to permit Quantum to perform its obligations under the Transactional Agreements (as defined in the STA), and to market products worldwide without conflicting with any such IMPCO-retained intellectual property. 5. Quantum shall budget the expenditure of [****] dollars ($[****]) per calendar year for GM directed research and development as described in Section 2.1(c) hereof. Quantum shall fund such $ [****] annually unless a lesser amount is agreed to by the Parties for any particular year. (b) Negative Covenants. ------------------ 1. Quantum shall not pledge, hypothecate or otherwise encumber the Quantum-Owned Technology or Jointly-Owned Technology (as defined in the Development Agreement) except in the ordinary course of business as may be required by commercial lenders; provided, however, that no such -4- encumbrances shall have the effect of limiting or restricting in any fashion the ability of GM to acquire, license or use the Quantum-Owned Technology or Jointly-Owned Technology as provided in this, and in the Development Agreement, without the prior written approval of GM having been obtained. 2. Quantum shall not grant any exclusive license to the Quantum-Owned Technology or Jointly-Owned Technology to third parties, without the prior written approval of GM having been obtained. 3. Quantum shall not offer to sell, or sell, any shares of its capital stock in a private placement (an offering not constituting a bona fide, firmly underwritten public offering of shares of Common Stock registered under the Securities Act of 1933, as amended) without the prior written consent of GM; provided, however, that such prohibition shall not be applicable to the issuance or sale of shares of Common Stock (or options therefor) to employees, directors and consultants for the primary purpose of soliciting or retaining their services. ARTICLE III ----------- BUSINESS DEVELOPMENT ACTIVITIES ------------------------------- 3.1 Joint Efforts. The Parties shall work together to develop and share ------------- sourcing and marketing strategy in connection with the enhancement and commercialization of the Business. 3.2 Joint Research and Development. GM and Quantum shall use their best ------------------------------ efforts to jointly develop Statements of Work for product research and development as further set forth in the Development Agreement. 3.3 Commercial Team. Within ten (10) business days of the Effective Date, --------------- each Party shall assign one (1) member ("Member") to a joint commercial steering team to meet and cooperate to define and manage the efforts associated with this Agreement ("Commercial Team"). The Members shall include business development representatives with sufficient authority and experience to make recommendations with respect to the usefulness, marketability, and all inter-related business development opportunities relating to the Projects defined in the Development Agreement or any other aspect of the Business which the Members deem appropriate. Either Party may replace its Member in its sole discretion upon notice to the other Party. Each Party shall bear its own costs and expenses related to the Commercial Team. At least the first meeting of the Commercial Team shall be face-to-face. (a) The Commercial Team shall, among other things, consider and determine, where appropriate, the marketability of specific Projects (as -5- defined in the Development Agreement). Prior to any commercial release thereof, the Members shall determine a marketing plan addressing distribution rights for the given Project, customer support obligations, joint business development efforts, identification of strategic marketing opportunities and distribution channels, promotions and press releases, packaging, and product endorsement opportunities. (b) At the first meeting of the Commercial Team, to be held at a time and location as mutually agreed, the Members shall discuss the current state of the Market and the Business, and perform an initial assessment as to the associated market conditions ("Commercial Roadmap"). From time to time, the Commercial Team may modify the Commercial Roadmap as deemed necessary. (c) If the Commercial Team Members cannot reach a decision on a particular issue, including modifications to the Commercial Roadmap, senior managers of Quantum and GM will meet and negotiate in good faith to resolve the issue within a reasonable period of time. If the issue is not resolved within thirty calendar (30) days, the Commercial Roadmap will remain unchanged. Notwithstanding the foregoing, neither Party shall be required to implement a decision of the Commercial Team if such decision may reasonably result in legal liability for such Party. 3.4 Trademarks. No rights to use GM or Quantum trademarks or trade dress ---------- are granted under this Agreement. Any such rights shall only be granted pursuant to the terms of a written license agreement executed by each of the Parties. 3.5 Joint Communication Strategy. The Parties hereto shall consult and ---------------------------- cooperate with each other as to the form and substance of any press release or other public disclosure related to this Agreement, the transactions contemplated hereby or the subject matter hereof. Quantum agrees to submit to GM for its prior review and approval any press release or similar document or disposition designed for public consumption which mentions GM. Notwithstanding the foregoing, nothing in this Section 3.5 shall be deemed to prohibit Quantum or GM from making any disclosure necessary in order to satisfy such Party's disclosure obligations imposed by law. 3.6 Sourcing and Production. The Parties agree that there are no ----------------------- pre-commitments on sourcing or production from either Party. GM purchases from Quantum of advanced gaseous storage and handling systems or other related automotive components will be concluded on the then standard GM Purchase Order terms and conditions, and all such purchases will be contingent upon Quantum maintaining competitiveness with regard to Quality, Service, Technology and Price ("QSTP"). In the event Quantum fails to compete -6- successfully with other products or services performing the same, similar or substitute functionality, GM is free to purchase the competitive product and to refrain from making purchases from Quantum. Where Quantum is supplying components for GM production vehicles, standard automotive industry access rights as detailed in the GM Purchase Order will apply. 3.7 Distribution. ------------ (a) Distribution by GM. GM shall have the right to distribute ------------------ products and technology in accordance with the rights provided in the Development Agreement, subject to the following restrictions: (i) all such products shall be distributed under agreements that shall not adversely affect Quantum's rights and protections agreed upon in the Development Agreement and this Agreement; and (ii) to distribute any Quantum software included in such products in object code form only as an integral part of the relevant system. (b) Distribution by Quantum. Quantum shall have the right to ----------------------- distribute products and technology in accordance with the rights provided in the Development Agreement, subject to the following restrictions: (i) all such products shall be distributed under agreements that shall not adversely affect GM's rights and protections agreed upon in the Development Agreement and this Agreement; and (ii) to distribute any GM software included in such products in object code form only as an integral part of the relevant system. (c) Customers. GM shall provide software and hardware support to its --------- customers, including products purchased from GM's distributors; and Quantum shall provide software and hardware support to its customers, including products purchased from Quantum's distributors. (d) Agreements with Distributors and Original Equipment Manufacturers ----------------------------------------------------------------- ("OEM"). Each Party shall negotiate the terms and conditions of its own - ------- distribution agreements and OEM agreements. Each Party agrees, however, that such agreements will be written agreements, and will include all of the provisions contained herein which relate to confidentiality, production, and distribution. (e) Packaging. Each Party is free to package the products as it so --------- chooses, so long as it does not choose packaging that contains "Objectionable Material." Objectionable Material, for purposes of this Agreement, means any content or representation that is obscene, offensive, defamatory, libelous, dangerous, derogatory or discriminatory toward any individual, group or organization, or an infringement of the intellectual property rights of any Party or any third party. -7- [****] - CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. ARTICLE IV REVENUE SHARING PAYMENTS ------------------------ 4.1 Sales by Quantum for [****] Applications. Beginning on the [****] ---------------------------------------- anniversary of the Effective Date, Quantum shall pay to GM a percentage of the gross revenues derived from its sale of gaseous storage, handling and control products for Fuel Cell Systems for [****] applications accounted for in accordance with generally accepted accounting principles, in accordance with the following table: -------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****]through the year [****] -------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] -------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] -------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] --------------------------------------------------------------------------------
4.2 Sales by Quantum for [****] Applications. Beginning on the [****] ---------------------------------------- anniversary of the Effective Date, Quantum shall pay to GM a percentage of the gross revenues derived from its sale of gaseous storage, handling and control products for Fuel Cell Systems for [****] applications, accounted for in accordance with generally accepted accounting principles, in accordance with the following table: ---------------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through the year [****] ---------------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] ---------------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] ---------------------------------------------------------------------------------------- [****] percent ([****]%) of gross revenues received for years [****] through [****] ----------------------------------------------------------------------------------------
-8- [****] - CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS. 4.3 Final Revenue Sharing Payment. At year [****], Quantum will pay to ----------------------------- GM the present value of future revenue sharing payments that would otherwise be payable to GM on an annual basis. Such future payments assume an income stream to GM of [****]% of Quantum Fuel Cell System-related gross revenues in perpetuity. Valuation methodology and assumptions (which must be reasonable, theoretically sound, and consistent with industry practice), will be determined in the year [****] by GM and Quantum. In the event the Parties do not agree on a fair present value, the Parties will jointly select and pay for an independent valuation from a third party whose valuation will be binding. 4.4 Payment Detail. For revenue sharing payments that Quantum is obligated -------------- to make to GM, such payments shall be payable annually within forty-five (45) calendar days following the end of the fiscal year in which the gross revenues serving as the basis therefor were received. Quantum shall provide a report with each payment stating: (a) the number of Fuel Cell System-related products sold during the fiscal year for which payments are owed, and (b) a description of the products sold; and (c) a calculation of the payment due. 4.5 Books, Records, and Audit. Quantum shall keep complete and accurate ------------------------- records which support the payments called for in this Article IV. These records shall be retained for a period of at least three (3) years from the date of the applicable payment or report, notwithstanding the expiration or other termination of this Agreement, the Development Agreement or of any Statement of Work. GM or its designated accounting firm shall have the right to examine and audit, not more than once a year unless the preceding audit revealed a discrepancy, and during normal business hours, all such records and such other records and accounts as may contain, under recognized accounting practices, information bearing upon the amount of payments due to GM hereunder. 4.6 Taxes. All payments required by this Article IV are exclusive of any ----- and all federal, state, local and foreign taxes, duties, excises, fees, levies and assessments that may be imposed by any taxing authority on the payments or the gross revenues on which they are based. Each Party agrees to bear and be responsible for, and to pay directly to the appropriate taxing authority, all such taxes, duties, excises, fees, levies and assessments for which such Party is legally responsible. -9- ARTICLE V TERM OF AGREEMENT; TERMINATION ------------------------------ 5.1 Term. This Agreement will commence on the Effective Date and will ---- remain in effect for ten (10) years unless earlier terminated pursuant to Section 5.2 ("Termination of Agreement"). At the end of the initial term, this Agreement will renew, subject to mutual consent of the Parties, for consecutive three (3) year terms, unless terminated in accordance with Section 5.2. 5.2 Termination of Agreement. ------------------------ (a) This Agreement may be terminated at any time by mutual consent of the Parties. (b) This Agreement may be terminated by either Party, only if the other Party commits a material breach of this Agreement and such breach is not cured within thirty (30) business days after the nonbreaching Party has given the breaching Party written notice sufficiently describing the nature of the breach. (c) Notwithstanding Section 5.2(b), either Party may terminate this Agreement effective immediately and without liability upon written notice to the other Party if any one of the following events occurs: (a) the other Party files a voluntary petition in bankruptcy or otherwise seeks protection under any law for the protection of debtors; (b) a proceeding is instituted against the other Party under any provision of the U.S. Bankruptcy Code or equivalent legislation of a foreign jurisdiction which is not dismissed within ninety (90) calendar days; (c) the other Party is adjudicated bankrupt; (d) a court assumes jurisdiction of the assets of the other Party under a federal reorganization act or equivalent legislation of a foreign jurisdiction; (e) a trustee or receiver is appointed by a court for all or a substantial portion of the assets of the other Party; (f) the other Party becomes insolvent, ceases or suspends business; or (g) the other Party makes an assignment of the majority of its assets for the benefit of its creditors. 5.3 Effect of Termination. In the event of the termination or abandonment --------------------- of this Agreement as provided herein, this Agreement shall become void and have no further effect, and each Party shall pay all of its own expenses incurred in connection herewith, without any liability on the part of any Party or its directors, officers or stockholders, except for agreements as to confidentiality, and such other provisions reasonably expected to survive termination, including all provisions identified as surviving in the Development Agreement, the STA and the RRA; provided, however, that if any Party willfully fails to perform its obligations hereunder, the other Party shall have the right to seek legal and -10- equitable remedies as available under applicable law. Moreover, provided that GM shall have met its obligations under the Development Agreement, the Stock Transfer Agreement and this Agreement, Quantum shall then have the continuing obligation to make revenue sharing payments pursuant to Article IV hereof following termination of this Agreement. ARTICLE VI RIGHT OF FIRST REFUSAL ---------------------- 6.1 GM's Right of First Refusal. In the event that Quantum proposes to --------------------------- sell, assign, transfer or otherwise convey ("Transfer") all or part of the Quantum-Owned Technology or Jointly-Owned Technology to any third party or parties, then Quantum shall offer to GM the right to purchase such Quantum-Owned Technology or Jointly-Owned Technology (hereinafter the "Offered Technology") on the same terms (or terms as similar as reasonably possible) and conditions as set forth in a written notice of the proposed Transfer (hereinafter the "Transfer Notice"). The Transfer Notice shall include (i) a description of the Offered Technology, (ii) the identity of the prospective transferee(s), (iii) the consideration and the material terms and conditions upon which the proposed Transfer is to be made, and (iv) the expected closing date for the Transfer. The Transfer Notice shall also include a copy of any written proposal, term sheet or letter of intent or other agreement relating to the proposed Transfer, and Quantum shall certify that it has a good faith belief that a binding agreement for the Transfer is obtainable on the terms described in, or attached to, the Transfer Notice. Upon written notice by GM within twenty (20) business days of its receipt of the Transfer Notice, GM may notify Quantum in writing of its desire to purchase the Offered Technology from Quantum at the same price, and upon the same terms (or terms as similar as reasonably possible) as described in the Transfer Notice, and Quantum shall transfer the Offered Technology to GM pursuant to such terms. 6.2 Transfer Period. If the Offered Technology is not purchased by GM --------------- pursuant to Section 6.1, Quantum shall be entitled for a period of sixty (60) calendar days thereafter to complete the proposed Transfer of the Offered Technology upon the terms and conditions specified in the Transfer Notice. If Quantum has not so transferred the Offered Technology during such period, Quantum shall not thereafter make a Transfer of the Offered Technology without again first offering such assets to GM in the manner provided in Section 6.1. 6.3 Valuation of Property. Should the purchase price specified in the --------------------- Transfer Notice be payable in property other than cash or evidences of indebtedness, GM shall have the right to pay the purchase price in the form of cash equal in amount to the value of such property. If Quantum and GM cannot agree on such cash value within twenty (20) business days after GM's receipt of the -11- Transfer Notice and by the time GM notifies Quantum of its intent to purchase the Offered Technology pursuant to Section 6.1 above, the valuation shall be determined by an independent appraisal firm selected and approved by Quantum and GM, which approval shall not be unreasonably withheld. The cost of such appraisal shall be borne by GM. The appraisal shall be completed and the GM purchase closed within thirty (30) business days thereafter. If the time for the closing of GM's purchase has expired because the determination of the value of the purchase price offered by the prospective transferee(s) has not been timely received, then such closing shall be continued and held on or before the fifth (5th) business day after such valuation shall have been made pursuant to this Section 6.3. ARTICLE VII RIGHT TO PURCHASE ----------------- 7.1 Right to Purchase. In the event of any decision by Quantum to ----------------- discontinue the Business or otherwise upon any liquidation, dissolution or winding up of Quantum, whether voluntary or involuntary, under the dissolution provisions of the Delaware General Corporation Law ("DGCL") ss. 275 et seq., or any successor statute, Quantum shall give notice to GM of such decision, and GM shall have the right to purchase the Quantum-Owned Technology and/or the Jointly-Owned Technology on the terms and conditions approved by the Board in accordance with the provisions of Section 7.2 below. 7.2 Determination of Fair Market Value of the IP. The Parties hereby agree -------------------------------------------- that the fair market value of such Quantum-Owned Technology and Jointly-Owned Technology (hereinafter the "Technology FMV") shall be determined by an independent appraisal firm with proven expertise in the field of valuation of intellectual property chosen and paid for by GM and approved by the Board, which approval shall not be unreasonably withheld. Such valuation shall be binding upon the Parties with regard to the exercise of GM's right to purchase under this Article VII. 7.3 Exercise of Right. In order properly to exercise its right to purchase ----------------- hereunder, GM shall have ten (10) business days after determination of the Technology FMV to decide whether to purchase such Quantum-Owned Technology and/or Jointly-Owned Technology and, if it decides to do so, the transaction shall close within an additional twenty (20) business days subject to the requirement for any regulatory, judicial or other third party approvals. (a) In the case of a proposed dissolution, if GM does not purchase the Quantum-Owned Technology and/or Jointly-Owned Technology as provided herein, Quantum shall be entitled to discontinue the Business or to -12- pursue dissolution proceedings to the extent it has the right to do so under the DGCL. (b) Notwithstanding the foregoing, if the proposed dissolution has not commenced within ninety (90) calendar days of GM's refusal to purchase the Quantum-Owned Technology and/or Jointly-Owned Technology, GM's rights under this Article VIII shall be revived. 7.4 Right to Purchase in Event of Insolvency. In the event Quantum is ---------------------------------------- deemed by a court of competent jurisdiction to be insolvent, either (a) because the sum of its debts is greater than all of its property at fair valuation; (b) because it is unable to pay its debts as they become due; and/or (c) because it is the subject of a voluntary or involuntary petition under the United States Bankruptcy Code (11 U.S.C. Sections 101 et seq.) which is not dismissed within sixty (60) calendar days, or the subject of an assignment for benefit of creditors, receivership, service of a writ of attachment or replevin with respect to a material part of its property, or the subject of an appointment of a custodian, keeper, conservator or trustee over Quantum or part or all of its assets, or the subject of a regulatory seizure, conservatorship or receivership or foreclosure of a material part of its property, then GM shall be given the opportunity to purchase the Quantum-Owned Technology and Jointly-Owned Technology subject to all necessary or appropriate regulatory and judicial approvals, at the value as determined in accordance with the applicable and appropriate regulatory and/or judicial procedures. ARTICLE VIII DISPUTE RESOLUTION ------------------ 8.1 Agreement to Arbitrate. Any claim, controversy or dispute arising out ---------------------- of or with respect to this Agreement, the Development Agreement, the STA, and/or the RRA, or the breach hereof or thereof, on which an amicable understanding cannot be reached (each, a "Dispute"), to the maximum extent allowed by applicable law and irrespective of the type of relief sought, shall be submitted to binding arbitration as set forth below. Such arbitration shall be heard and conducted in Orange County, California, and shall be conducted expeditiously and confidentially in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"), as such rules shall be in effect on the date of delivery of a written demand for arbitration (an "Arbitration Demand"), with the exception that the arbitrators may not award any punitive or exemplary damages, and except as such rules may be otherwise inconsistent with the express provisions of this Article VIII. -13- 8.2 Notice of Dispute; Preliminary Resolution Procedures. Prior to ---------------------------------------------------- submission of a Dispute to the binding arbitration procedure described in Section 8.3 below, the Parties shall attempt to resolve the Dispute as follows: (a) In the event a Party believes it has a Dispute subject to arbitration hereunder, such Party shall notify the other Party in writing of the nature of such Dispute (the "Dispute Notice"). (b) The Parties shall attempt to settle the Dispute by referring it to the Commercial Team assisted, as it sees fit, by members of the Technical Team described in the Development Agreement. Such team shall meet to negotiate resolution of the Dispute within fifteen (15) business days of the date of the Dispute Notice. (c) In the event the Commercial Team does not agree upon a resolution to the Dispute within fifteen (15) business days following its meeting, the Parties shall further attempt to settle the Dispute by referring it to their respective senior management teams ("Senior Management"). Senior Management shall meet to negotiate the resolution of the Dispute within forty-five (45) business days of the date of the Dispute Notice. (d) In the event Senior Management does not agree upon a resolution to the Dispute within fifteen (15) business days following its meeting, either Party may initiate arbitration as set forth in Section 8.3 below. 8.3. Initiating Arbitration. In order to initiate arbitration, a Party ---------------------- shall file an Arbitration Demand on the form and pursuant to the procedures prescribed by the AAA, provided that at least one (1) copy of the Arbitration Demand must be sent to the other Party hereto. Within fifteen (15) business days of delivery of the Arbitration Demand, each Party shall appoint one (1) arbitrator. If a Party does not select an arbitrator, the selected arbitrator shall serve as the sole arbitrator. If both Parties select arbitrators, the selected arbitrators shall, within fifteen (15) business days of their appointment, appoint an additional arbitrator. In the event that the arbitrators selected by the Parties are unable to agree upon the selection of the additional arbitrator after reasonable efforts within such fifteen (15)-day period, a list of seven (7) qualified and available individuals, who do not reside or primarily do business in the states of California and/or Michigan, shall be requested from the AAA. Each Party shall take turns striking one (1) individual from the list with the last remaining individual being the additional selected arbitrator. Once selected, the arbitration panel shall meet as expeditiously as possible, select a chairman, schedule the arbitration hearing, and notify the Parties in writing of the date, time and place of the hearing. -14- 8.4. Effect. All conclusions of law reached by the arbitrators shall be ------ made in accordance with the internal laws of the state of Delaware without regard for its conflict of laws doctrine. Any award rendered by the arbitrators shall be accompanied by a written opinion setting forth the findings of fact and conclusions of law relied upon in reaching their decision. The award rendered by the arbitrators shall be final, binding and non-appealable, and judgment upon such award may be entered by any court having jurisdiction thereof. The Parties agree that the existence, conduct and content of any such arbitration shall be kept confidential and that no Party shall disclose to any third party any information about such arbitration, except as may be required by law or for financial reporting purposes in each Party's financial statements. 8.5. Costs. Each Party shall pay the fees of its own arbitrator, attorneys, ----- expenses of witnesses and all other expenses in connection with the presentation of such Party's case. The remaining costs of the arbitration, including, without limitation, fees of the additional arbitrator(s), costs of records or transcripts, the fee required to file the demand for arbitration and other administrative fees, shall be borne fifty percent (50%) by Quantum and fifty percent (50%) by GM. ARTICLE IX CONFIDENTIALITY --------------- 9.1 Definition of Confidential Information. Confidential Information shall -------------------------------------- mean documents and hardware disclosed by a Party which are directly related to the purpose of this Agreement and which the disclosing Party deems confidential. 9.2 Handling of Confidential Information. During the term of and pursuant ------------------------------------ to this Agreement, the Parties, to the extent of their right and willingness to do so, may exchange Confidential Information relating to the purpose of this Agreement. A Party receiving such Confidential Information agrees to take reasonable efforts to avoid disclosure thereof to third parties, subject to the provisions and exceptions of this Agreement, for a period of three (3) years from the Effective Date of this Agreement. Reasonable efforts shall mean efforts which are equivalent to those which the receiving Party uses to protect its own Confidential Information of a similar nature, related to the purpose of this Agreement. In order to be deemed Confidential Information subject to the requirements of this Article IX, the information must be identified as such with a conspicuous marking which refers to this Agreement by title and Effective Date as follows: "This document/hardware is to be protected from disclosure to third parties, -15- pursuant to the Corporate Alliance Agreement between Quantum Technologies Worldwide and GM dated June 12, 2001." 9.3 Disclosure of Confidential Information. Confidential Information -------------------------------------- disclosed by a Party shall remain the property of that Party and shall be returned, at the request of the disclosing Party, upon the termination of this Agreement, or upon earlier request of the disclosing Party. 9.4 Confidentiality of Alliance Agreement. Each Party agrees that the ------------------------------------- terms and conditions of this Agreement shall be treated as confidential and that neither Party will disclose the terms or conditions of this Agreement to any third party without the prior written consent of the other Party, provided, however, that each Party may disclose the terms and conditions of this Agreement, to the extent necessary: (a) as required by any court or other governmental body; (b) as required by law; (c) in confidence to legal counsel of the Parties, accountants, and other professional advisors; (d) in confidence, to banks, investors and other financing sources and their advisors; (e) in connection with the enforcement of this Agreement or rights under this Agreement; or (f) in confidence, in connection with an actual or prospective merger or acquisition or similar transaction. With respect to disclosure required by a court or governmental order, the disclosing Party shall provide prior notification of such impending disclosure to the non-disclosing Party. All reasonable efforts to preserve the confidentiality of the terms of this Agreement shall be expended by the disclosing Party in complying with such an order, including obtaining a protective order to the extent reasonably possible. Any SEC filings required by law shall be made after any sensitive information in the Agreement has been accorded confidential protection under applicable SEC rules and regulations. ARTICLE X NOTICES ------- All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the Party to whom notice is to be given, (b) upon confirmation of receipt by fax by the Party to be notified, (c) one business day after deposit with a reputable overnight courier, prepaid for overnight delivery and addressed as set forth in (d), or (d) upon confirmation of receipt if mailed by first class mail, registered or certified, postage prepaid, and properly addressed as follows: -16- If to Quantum: QUANTUM TECHNOLOGIES WORLDWIDE, INC. 17872 Cartwright Road Irvine, CA 92614 Facsimile: 949-474-3086 Attn: Syed F. Hussain, President with a copy to: PERKINS COIE 1620 26/th/ Street, Sixth Floor Santa Monica, CA 90404 Facsimile: 310-788-3399 Attn: Charles L. Couch III If to GM: GENERAL MOTORS CORPORATION 300 Renaissance Center P.O. Box 300 Detroit, MI 48265-3000 MC 482-625-D81 Facsimile: 313-667-3188 Attn: General Counsel Any Party may change its address for purposes of this Article by giving the other Party written notice of the new address in the manner set forth above. ARTICLE XI MISCELLANEOUS ------------- 11.1 Export. Each Party agrees that it will not export, or attempt to export, from any country any technical data received hereunder or the product produced by use of such technical data, without first obtaining all necessary licenses and consents under any applicable treaties, statutes and regulations, including, without limitation, the Export Administration Act of 1979, as amended, any successor legislation, and the Export Administration Regulations issued by the Department of Commerce, International Trade Administration, or Office of Export Licensing. Each donor Party will notify the receiving Party of any technical information, data or hardware that the donor Party supplies and knows to be controlled information/data/hardware under any of the aforesaid treaties, statutes and regulations. 11.2 Governing Law and Forum Selection. This Agreement shall be governed by Delaware law, excluding its conflict of laws rules. With the -17- exception of either Party's right to enforce its proprietary rights through injunctive relief, and consistent with the Parties' obligations to submit disputes to arbitration pursuant to the terms of Article VIII hereof, all disputes arising out of this Agreement shall be subject to the exclusive jurisdiction and venue of the California state and federal courts located in Orange County, California, and the Parties consent to the personal and exclusive jurisdiction and venue of these courts. The Parties expressly disclaim the application of the United Nations Convention on the International Sale of Goods to this Agreement. 11.3 Attorneys' Fees. In the event of any action, suit or proceeding, including arbitration, between the Parties hereto, each Party shall be responsible for its own costs and attorneys' fees. 11.4 Waiver. The delay or failure of a Party to exercise any right, power, remedy, or privilege hereunder or failure to strictly enforce any breach, violation, default, provision or condition shall not impair any such right, power, remedy or privilege nor shall it constitute a waiver thereof or acquiescence thereto. Any waiver, permit, consent, or approval of any kind regarding any breach, violation, default, provision or condition of this Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing. No partial waiver of any such right, power, privilege, breach, violation, default, provision, or condition on any one occasion shall preclude any other or further exercise thereof or constitute a waiver thereof or acquiescence thereto on any subsequent occasion unless clear and express notice thereof in writing is provided. 11.5 Assignment. This agreement shall not be assigned by either Party without the prior written approval of the other Party except to the successor in ownership by sale, merger, consolidation or divestiture of all or substantially the whole of the relevant business (i.e. Fuel Cell Systems for GM and gaseous storage and handling equipment for Quantum) of the Party wishing to make the assignment. The Agreement will be binding upon and inure to the benefit of each Party's authorized successors and permitted assigns. 11.6 Captions. All Section captions and headings are for reference only and shall not be considered in interpreting or construing this Agreement. 11.7 Severability. If any provision of this Agreement is declared invalid, illegal, or unenforceable by any tribunal, then such provision shall be deemed automatically adjusted to conform to the requirements for validity as declared at such time and, as so adjusted, shall be deemed a provision of this Agreement as though originally included herein. In the event that the provision deemed invalid, illegal or unenforceable is of such a nature that it cannot be so adjusted, the provision shall be deemed deleted from this Agreement as though the provision had never been included herein. If any provision or portion of this Agreement is -18- held to be unenforceable or invalid, the Parties agree to negotiate, in good faith, a substitute valid provision which most nearly effects the Parties' intent in entering into this Agreement. In either case, the remaining provisions of this Agreement shall remain in full force and effect. WITHOUT LIMITING THE FOREGOING, IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION OF THIS AGREEMENT WHICH PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTY OR EXCLUSION OF DAMAGES IS INTENDED BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER SUCH PROVISION. FURTHER, IN THE EVENT THAT ANY REMEDY HEREUNDER IS DETERMINED TO HAVE FAILED OF ITS ESSENTIAL PURPOSE, ALL LIMITATIONS OF LIABILITY AND EXCLUSIONS OF DAMAGES SHALL REMAIN IN EFFECT. 11.8 Independent Contractors. The Parties are each independent contractors and neither Party shall be, nor represent itself to be, the franchiser, joint venturer, franchisee, partner, broker, employee, servant, agent, or legal representative of the other Party for any purpose whatsoever. Neither Party is granted any right or authority to assume or create any obligation or responsibility, express or implied, on behalf of or in the name of the other Party, or bind the other Party in any matter or thing whatsoever, including but not limited to, the right or authority to obligate the other Party to accept or deliver any order, or to sell or refuse to sell to any potential customer. 11.9 Remedies Cumulative. All remedies, either under this Agreement or by law or otherwise afforded to any Party, shall be cumulative and not exclusive or alternative and shall be in addition to all remedies given hereunder or now or thereafter existing, at law or in equity, by statute or otherwise. The election of any one or more remedies by any Party shall not constitute a waiver of the right to pursue other available remedies. 11.10 Injunctive Relief. The Parties acknowledge that any breach of the provisions of this Agreement relating to proprietary rights of either Party may cause irreparable harm and significant injury to an extent that may be difficult to ascertain. Accordingly, each Party agrees that the other Party will have, in addition to any other rights or remedies available to it at law or in equity, the right to seek injunctive relief to enjoin any breach or violation of such sections. 11.11 Force Majeure. Either Party shall be excused from any delay or failure in performance hereunder, except the payment of monies, caused by reason of any occurrence or contingency beyond its reasonable control, including but not limited to, acts of God, earthquake, floods, lightning, labor disputes and strikes, other labor or industrial disturbances, riots, war, acts of the public enemy, insurrections, embargoes, blockages, regulations or orders of any government, -19- agency or subdivision thereof, shortages of materials, rationing, utility or communication failures, casualty, novelty of product manufacture or other unanticipated product development problems, and governmental requirements. The obligations and rights of the Party so excused shall be extended on a day-to-day basis for the period of time equal to that of the underlying cause of the delay; provided that such Party shall give notice of such force majeure event to the other Party as soon as reasonably possible. 11.12 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall constitute an original, but taken together shall constitute one and the same document. 11.13 Entire Agreement. This Agreement and the other agreements, documents, exhibits, and writings attached and/or delivered pursuant hereto or concurrently herewith, including without limitation, the Development Agreement, the STA and the RRA referenced therein (and specifically excluding purchase orders), contain and constitute the sole, complete and entire agreement and understanding of the Parties concerning the matters contained herein and therein and may not be altered, modified or changed in any manner except by writing duly executed by the Parties. No statements, promises or representations have been made by any Party to another, or are relied upon, and no consideration has been or is offered promised, expected or held out, other than as stated in this Agreement or the other agreements and documents referenced herein. No Party is relying on any representations other than those expressly set forth herein or therein. No conditions precedent to the effectiveness of this Agreement exist, other than as may be expressly provided herein. IN WITNESS WHEREOF, the Parties to this Agreement have duly executed it as of the day and year first above written. Quantum: GM: QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation GENERAL MOTORS CORPORATION, a Delaware corporation By: /s/ Syed F. Hussain By: /s/ Lawrence D. Burns ------------------------------ ------------------------------ Name: Syed F. Hussain Name: Lawrence D. Burns Title: President and CEO Title: Vice President, GM Research & Development and Planning -20- EX-10.32 3 dex1032.txt MASTER TECHNICAL DEVELOPMENT AGREEMENT Exhibit 10.32 MASTER TECHNICAL DEVELOPMENT AGREEMENT This MASTER TECHNICAL DEVELOPMENT AGREEMENT ("Development Agreement") is entered into as of June 12, 2001 ("Execution Date") by QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation ("Quantum") and GENERAL MOTORS CORPORATION, a Delaware corporation ("GM"), each a Party and collectively the Parties. This Development Agreement shall have an Effective Date of January 1, 2001. Recitals A. Quantum designs, develops and manufactures advanced gaseous storage and handling modules, electronic controls and software, and systems integration involving compressed gaseous fuels. B. GM designs and develops Fuel Cell Systems (defined below). C. The Parties seek to cooperate with each other under this Development Agreement to facilitate the integration, interface, and optimization of the GM Fuel Cell Systems coupled with the Quantum gaseous fuel storage and handling modules. Agreement 1 Definitions. 1.1 "Affiliate" of a Party means any person or entity which, through one or more intermediaries, controls, is controlled by or is under common control with such Party. "Control" shall be presumed if a person or entity holds the power, by equity ownership or otherwise, to elect at least fifty percent (50%) of the directors of the other person or entity or otherwise to direct the policies and business activities of the other person or entity. 1.2 "Corporate Alliance Agreement" means that certain Corporate Alliance Agreement executed between the Parties on June 12, 2001. 1.3 "Fuel Cell System" means a cell or cells, and/or its/their related customary support equipments (i.e., alone or in combination with cell(s)), for the electrochemical generation of electricity from hydrogen and oxygen (or generation of hydrogen from electricity and water), including (1) fuel cells and any other devices that generate electricity from hydrogen or hydrogen-rich fuel, (2) electrolyzers and any other devices that generate hydrogen from water, and (3) fuel processors and any other devices that produce hydrogen from hydrogen- containing materials other than water. 1.4 "GM Interface Technology" means Interface Technology used specifically to integrate the Quantum Products with the GM Products, created during the performance of a GM Program. 1.5 "GM Modifications" means any and all Intellectual Property pertaining to the Quantum Products developed solely by GM during the performance of a GM Program. 1.6 "GM Product" means a Fuel Cell System, and such related products that have been developed by or for GM using Intellectual Property owned or controlled by GM, or under which GM has rights, prior to the commencement of the relevant Project. 1.7 "GM Program" means a specific agreed cooperative activity under the purposes contemplated in this Development Agreement, and described in a Statement Of Work, the results of which are intended to facilitate the integration, interface, and optimization of the Quantum Products/Quantum Technology/GM Modifications for exclusive application to GM Fuel Cell Systems/GM Products/GM Technology/Quantum Modifications. 1.8 "GM Program Technology" means any and all Intellectual Property in each case created, conceived, discovered, developed and/or invented by or on behalf of one or both of the Parties during the performance of a GM Program (excluding GM Interface Technology). GM Program Technology, for purposes of this Development Agreement, can be further divided into: GM Technology, GM Modifications, Quantum Technology, and Quantum Modifications. 1.9 "GM Technology" means any and all Intellectual Property pertaining to the GM Fuel Cell Systems developed solely by GM during the performance of a GM Program. 1.10 "Generic Interface Technology" means Interface Technology that is conceived or first reduced to practice in the course of the work performed pursuant to this Development Agreement and is generally applicable, or common, to many interface technologies, but not specific to any one such technology. Hence, Generic Interface Technology would include general principles/concepts relating to interfacing, but not include the specific GM configuration that is GM Interface Technology, or specific Non-GM configurations that are Non-GM Interface Technology. 1.11 "Intellectual Property" means patents, patent applications and statutory invention registrations, trade secrets, know-how, inventions, manufacturing and production processes and techniques, research and development information, technologies, drawings, specifications, designs, plans, proposals, technical data, and other technical information, copyrights, mask works and designs, and all other intellectual and industrial property, including registrations and applications for registration thereof. 1.12 "Interface Technology" means any and all Intellectual Property relating to the processes, hardware and/or software which is/are used to integrate the Quantum Products with Fuel Cell Systems and is generated or developed in the performance of a Project. 1.13 "Non-GM Interface Technology" means Interface Technology, other than GM Interface Technology, that is used specifically to integrate Quantum Products with non-GM Fuel Cell Systems. 2. 1.14 "Non-GM Program" means a specific activity under the purposes contemplated in this Development Agreement, the results of which are intended for application to products manufactured by or for non-GM entities using Quantum Products and non-GM Fuel Cell Systems. 1.15 "Non-GM Program Technology" means any and all Intellectual Property in each case created, conceived, discovered, developed and/or invented by or on behalf of one or both of the Parties during the performance of a Non-GM Program. Non-GM Program Technology, for purposes of this Development Agreement, can be further divided into the following: Non-GM Program Technology From GM; and Non- GM Program Technology From Quantum. 1.16 "Non-GM Program Technology From GM" means any and all Intellectual Property in each case created, conceived, discovered, developed, and/or invented solely by GM in the performance of a Non-GM Program, solely as it relates to the Quantum Products. 1.17 "Non-GM Program Technology From Quantum" means any and all Intellectual Property in each case created, conceived, discovered, developed, and/or invented solely by Quantum in the performance of a Non-GM Program, solely as it relates to the GM Fuel Cell Systems. 1.18 "Project" means the specific Non-GM Programs and GM Programs, along with the associated research and development. 1.19 "Quantum Modifications" means any and all Intellectual Property pertaining to the GM Products developed solely by Quantum during the performance of a GM Program. 1.20 "Quantum Product" means Quantum's gaseous storage and handling equipment, controls and related software, and such related products that have been generated or developed by or for Quantum using Intellectual Property owned or controlled by Quantum, or under which Quantum has rights, prior to the commencement of the relevant Project. 1.21 "Quantum Technology" means any and all Intellectual Property pertaining to the Quantum Products developed solely by Quantum during the performance of a GM Program, relating to Quantum's gaseous storage and handling processes, equipment and/or software developed in support of GM Fuel Cell Systems. 1.22 "Statement of Work" means a detailed plan to implement a GM Program, as more fully defined in Section 3.1. A template Statement of Work shall be attached hereto as Exhibit A. 1.23 "Technical Team" means the combination of assignees from each Party that will create the Project Roadmap (as defined in Section 2 below) and manage work under this Development Agreement as described herein. 3. 2 Technical Team. Within ten (10) business days of the Effective Date, each Party shall assign one (1) member ("Member") to a joint technical steering team to meet and cooperate to define and manage the efforts associated with this Development Agreement ("Technical Team"). The Members shall include technical representatives with sufficient authority and experience to make recommendations with respect to the selection and implementation of the prospective Projects. Either Party may replace its Members in its sole discretion upon notice to the other Party. Each Party shall bear its own costs and expenses related to the Technical Team. The purpose of the Technical Team is to determine the types of Projects and timetables for each Project ("Project Roadmap"), to add Projects to the Project Roadmap, to change existing Projects, including, but not limited to schedule changes, and to cancel existing Projects ("Project Modification"). (a) The Technical Team shall determine the priority of different Projects, and the amount of engineering resources to be allocated to each Project. (b) The Technical Team shall review all Jointly-Owned Technology (as defined in section 5.3) proposed for patenting, and make recommendations to the Commercial Team (see Corporate Alliance Agreement) as to the merits of seeking patent protection on such inventions. The Commercial Team shall make the final decision as to whether or not, and in what countries, to seek patent(s). (c) At the first meeting of the Technical Team, to be held at a time and location as mutually agreed, the Members shall discuss and approve the initial Projects and the amount of engineering resources to be allocated to each Project ("Initial Project Roadmap"). At least the first meeting of the Technical Team shall be face-to-face. The Technical Team shall revise and publish the Project Roadmap as deemed necessary. (d) If the Technical Team cannot reach a decision on a particular issue, senior managers of Quantum and GM will meet and negotiate in good faith to resolve the issue within a reasonable period of time. If the issue is not resolved within thirty (30) calendar days, the Project Roadmap will remain unchanged. Notwithstanding the foregoing, neither Party shall be required to implement a decision of the Technical Team if such decision may reasonably result in legal liability for such Party. 3 Development 3.1 Development Agreement and Statement(s) of Work. The Parties acknowledge that this agreement between Quantum and GM is a master agreement. This Development Agreement defines the terms and conditions that will apply to any Statement(s) of Work executed hereunder. The Parties understand that, from time to time, good faith negotiations may take place to supplement this Development Agreement with Statements of Work. Each Statement of Work will require that Quantum integrate, interface, and optimize specified Quantum Products/Quantum Technology/GM Modifications with GM Products/GM Technology/Quantum Modifications. Each Statement of Work will define the timetable, performance and delivery obligations of the Parties, and will be executed by GM and Quantum. Subject to the terms and conditions 4. of this Development Agreement, Quantum agrees to use commercially reasonable efforts to perform in accordance with the specifications and schedule set forth in each Statement of Work. Finally, the Parties agree that there is no limit on the number of Statements of Work that may be executed during the term of this Development Agreement; provided, however, that Quantum shall have no obligation to fund work described in Statements of Work in excess of the aggregate amount set forth in the Corporate Alliance Agreement. Notwithstanding the foregoing, in the event that GM fails to execute any Statement of Work on or before the three (3) year anniversary of the Effective Date, Quantum shall be entitled to terminate this Development Agreement. 3.2 Reporting Development Progress. Each Party shall appoint a project manager who will coordinate and act as liaison with the other Party with respect to each Statement of Work. The project managers shall participate in project review meetings to be scheduled by mutual agreement of the respective project managers. GM personnel shall be entitled to visit Quantum's place of business upon reasonable prior notice to Quantum to discuss and inspect the status of progress under any Statement of Work. Quantum shall keep GM reasonably informed of its progress under each Statement of Work. 3.3 Performance. In the event that Quantum is unable to complete a GM Program identified under a Statement of Work within a reasonable amount of time as determined by the Parties, and despite its commercially reasonable efforts, the Technical Team may terminate the relevant GM Program (each a "Terminated Project"). 3.4 Subcontractors. Either Party may use subcontractors (e.g. Thiokol) to perform any task assigned to such Party under a Statement of Work, provided that such subcontractor (a) is approved in writing by the Technical Team to perform such task, (b) agrees in writing to keep confidential all information and data received from the Parties or generated under the subcontract, and (c) agrees in writing to assign jointly to GM and Quantum (with rights as shall be negotiated between the Parties and reduced to writing before such subcontractor commences work) any and all inventions or improvements it, or its employees, make in connection with the subcontract. 3.5 Plant Visits. Personnel of either Party visiting facilities of the other Party will comply with all the then established and existing safety and environmental rules and regulations of the facility visited. The host Party shall not be responsible for death, damage, injury or loss suffered or incurred during visits to its facilities by any personnel in the employ of the other Party, except for death, damage, injury or loss resulting from the willful or negligent act or omission of the host Party, its agents, employees or third parties under the host Party's supervision or control. 4 License of Rights. 4.1 GM License to Quantum (a) GM grants to Quantum and its Affiliates a non-exclusive, worldwide license under Non-GM Program Technology From GM and GM Modifications to make, have made, use, have used, sell, offer to sell, and import (i) gaseous storage and handling 5. equipment, controls, software and related products for use with any GM or third party Fuel Cell System, and (ii) subject to future negotiations on a case-by- case basis, such non-Fuel Cell System related applications as the Parties may agree. (b) GM grants to Quantum and its Affiliates a non-exclusive, worldwide license under GM Technology, GM Interface Technology, and GM Program Technology jointly owned by GM and Quantum to make, have made, use, have used, sell, offer to sell and import gaseous storage and handling equipment, controls, software and related products solely for use with GM Fuel Cell Systems. (c) All rights in Intellectual Property and other proprietary rights of GM not expressly granted to Quantum in Sections 4.1(a) and (b), or elsewhere in this Development Agreement, are expressly reserved by GM. 4.2 Quantum License to GM. (a) Quantum grants to GM and its Affiliates a paid-up, exclusive, worldwide license under GM Interface Technology and GM Program Technology jointly owned by GM and Quantum to make, have made, use, have used, sell, offer to sell, and import products solely for use with GM Fuel Cell Systems, and agrees not to use such technologies in connection with Non-GM Fuel Cell Systems. (b) Quantum grants to GM and its Affiliates a paid-up, non-exclusive, worldwide license under Quantum Technology, Quantum Modifications, and Non-GM Program Technology From Quantum to make, have made, use, have used, sell, offer to sell, and import products solely for use with GM Fuel Cell Systems. (c) All rights in Intellectual Property and other proprietary rights of Quantum not expressly granted to GM in Sections 4.2(a) and 4.2 (b), or elsewhere in this Development Agreement, are expressly reserved by Quantum 4.3 Quantum License for Terminated Projects. In the event of a Terminated Project (as defined above in Section 3.3), and in addition to the licenses granted to GM under Section 4.2, Quantum shall grant GM a limited, non- exclusive, worldwide, non-transferable right to sublicense the use of Quantum Products as identified in the relevant Statement of Work applicable to the Terminated Project, solely as follows: (1) to a sublicensee approved by the Technical Team, (2) for the sublicensee's internal use to continue development of the Project; (3) for a length of time to be agreed upon by the Technical Team; (4) subject to confidentiality provisions no less restrictive than those specified in Section 9 of this Development Agreement, and (5) with a contract provision that requires assignment of any inventions it, or its employees, make to GM. (a) Upon the expiration of the term of such a sublicense, unless extended in a writing signed by Quantum, GM shall ensure that sublicensee packs the Quantum Products as originally delivered, including any derivative works or copies made, and ships them as directed by Quantum for receipt by Quantum no more than thirty (30) calendar days after the expiration of the limited sublicense (the "Return Period"). GM acknowledges that the Quantum Products provided to such sublicensees may embody 6. valuable Intellectual Property of Quantum, and as such, agrees to work with each sublicensee under this Section 4.3 to ensure that the Quantum Products are returned to Quantum within the Return Period, as evidenced by normal commercial shipping documents. In addition, in the event that the Quantum Products received are not, in Quantum's reasonable determination, returned in the same good condition, less normal wear and tear, in which they were delivered to GM or its sublicensee, GM shall pay to Quantum a reasonable amount as agreed by the Technical Team. (b) If any sublicensee breaches its obligations with respect to the limited sublicense granted under Section 4.3, and/or its obligations with respect to the treatment of the Quantum Products, and: (i) GM fails to use its reasonable efforts to remedy the breach and prevent further breaches by the sublicensee and: (ii) such failure materially jeopardizes Quantum's Intellectual Property rights and interests in and to any Quantum Products, Quantum may, at its election and in addition to any other remedies that it may have, obtain injunctive relief and/or undertake enforcement directly against the breaching third party. 4.4 Background License. Each Party grants to the other, and its Affiliates, a paid-up, non-exclusive, non-transferable, license under such of its Background Patents and Background Technology as is needed by the licensed Party to use any of the technology that results from any activities contemplated by this Development Agreement, where (i) "Background Patents" are understood to mean all patents, domestic or foreign, that are owned or controlled by a Party, that cover an invention directly related to the purpose of this Development Agreement, and which were not conceived or first reduced to practice in the course of the work performed pursuant to this Development Agreement, and (ii) "Background Technology" is understood to mean technical information owned or controlled by a Party and directly related to the purpose of this Development Agreement and which was not conceived or first reduced to practice in the course of the work performed pursuant to this Development Agreement. Quantum shall secure from its parent company, IMPCO Technology, Inc., all intellectual property rights necessary for Quantum to grant the background license called for in this Section 4.4. 5 Ownership and Patent Prosecution 5.1 GM Ownership As between the Parties, all right, title and interest in the GM Products, GM Technology, GM Modifications, Non-GM Program Technology From GM, and any other Intellectual Property, designs, data, documentation, technology, and/or know-how provided by GM to Quantum shall be owned exclusively by GM (collectively the "GM-Owned Technology"). 5.2 Quantum Ownership As between the Parties, all right, title and interest in the Quantum Products, Quantum Technology, Quantum Modifications, Non-GM Program Technology From Quantum, Non-GM Interface Technology, and any other Intellectual Property designs, data, documentation, technology, and/or know-how provided by Quantum to GM shall be owned exclusively by Quantum (collectively the "Quantum-Owned Technology"). 7. 5.3 Joint Ownership. As between the Parties, all right, title and interest in the GM Interface Technology, Generic Interface Technology, Non-GM Program Technology jointly created by the Parties, GM Program Technology jointly created by the Parties and any other Intellectual Property, designs, data, documentation, technology, and/or know-how jointly created or developed by the Parties while performing a Project (or through sublicensees identified under Section 4.3), shall be jointly owned by the Parties (collectively the "Jointly- Owned Technology"). 5.4 Patents. The Parties acknowledge that Quantum shall have the right and responsibility to prosecute patents for the Jointly-Owned Technology, subject to review by GM legal counsel. GM and Quantum will each pay fifty percent (50%) of the reasonable costs incurred by Quantum to prosecute such patents as are approved in writing by GM for filing, including filings and attorney fees. Quantum agrees that its counsel will make diligent efforts to file patent applications and obtain patents in all countries or territories of the world as are approved by GM in a timely fashion. (a) Quantum and GM will agree on the selection of patent counsel for the handling of Jointly-Owned Technology. Quantum shall take such actions as are necessary or appropriate to obtain patent protection with respect to any of the Jointly Owned Technology in the United States and any other country. Quantum agrees to obtain GM's written consent prior to the filing of any patent applications, it being agreed that any costs of such patent applications made without GM's prior written consent shall be born by Quantum, alone. GM agrees that its prior written consent shall not be unreasonably withheld. Quantum agrees to provide to GM copies of the patents pertaining to the Jointly-Owned Technology (including Patent Office pending applications and office actions), and such other information with respect thereto as GM may reasonably request. In the event that either Party does not wish to file for patent protection on Jointly-Owned Technology in a particular country, all rights with respect to the Jointly-Owned Technology in that country will revert to the Party funding a patent application in such country. (b) Quantum shall consult with GM and its counsel concerning the preparation and prosecution of all patent applications and shall provide GM with copies of all material documentation after receipt from, or prior to, submission to any governmental agency with jurisdiction to issue patents, so that GM may make comments with respect thereto which Quantum shall consider in good faith. 5.5 Disclosure of Inventions. All inventions or improvements relating to a Project that are developed in whole or in part by GM or Quantum personnel while performing such Project shall be promptly disclosed to GM and Quantum for patent worthiness consideration, and each Party shall execute, or obtain the execution of, any papers as may be necessary to perfect ownership thereof in the appropriate Party or Parties as set forth above, or as may be necessary in the obtainment, maintenance or enforcement of any patent, trade secret, trademark, copyright or other proprietary right 8. pertaining thereto. All expenses incident to such obtainment, maintenance and/or enforcement will be borne by the Party or Parties owning such inventions/improvements. 6 Support. 6.1 Obligations. Each Party agrees that it shall: (a) consult with the other Party regarding any advertising or trade practice which might adversely affect the good name, trademarks, goodwill, or reputation of the other Party; (b) obtain and maintain all necessary government licenses, permits, and approvals when necessary or advisable for implementation of this Development Agreement; and (c) comply with all applicable laws, statutes, and regulations. 6.2 Rights in Data. Both Parties acknowledge that all software and software-related items licensed pursuant to this Development Agreement and any Statement of Work are "Commercial Computer Software" or "Commercial Computer Software Documentation" as defined in FAR 12.212 for civilian agencies and DFARS 227.7202 for military agencies, and that in the event that Quantum is permitted under this Development Agreement to provide such items to the U.S. government, such items shall be provided under terms at least as restrictive as the terms of this Development Agreement and the applicable Statement of Work. 7 Warranties & Disclaimers. 7.1 WARRANTIES. Each Party warrants and represents to the other that: (a) it will perform all development and other services described in any Statement of Work in a professional and workmanlike manner, using reasonable skill and care in a manner consistent with the industry standards; and (b) it has the full power and authority to enter into this Development Agreement and all Statements of Work. 7.2 DISCLAIMERS. EXCEPT AS PROVIED IN SECTION 7.1 AND ELSEWHERE IN THIS DEVELOPMENT AGREEMENT, NEITHER PARTY MAKES ANY WARRANTY REGARDING THE INFORMATION AND SERVICES PROVIDED, AND EXPRESSLY DISCLAIMS ALL IMPLIED OR STATUTORY WARRANTIES WITH RESPECT TO ANY INFORMATION OR SERVICES, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES OF TITLE, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT. 8 Limitation of Liability. NEITHER PARTY WILL BE LIABLE FOR ANY LOST PROFITS OR OTHER INCIDENTAL, CONSEQUENTIAL, INDIRECT, OR SPECIAL DAMAGES ARISING FROM OR RELATING SOLELY TO THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND EVEN IF ANY EXCLUSIVE REMEDY STATED IN THIS AGREEMENT IS DEEMED TO FAIL OF ITS ESSENTIAL PURPOSE. 9 Confidentiality 9. 9.1 Definition of Confidential Information. Confidential Information shall mean documents and hardware disclosed by a Party which are directly related to the purpose of this Agreement and which the disclosing Party deems confidential. 9.2 Handling of Confidential Information. During the term of and pursuant to this Development Agreement, the Parties, to the extent of their right and willingness to do so, may exchange Confidential Information relating to the purpose of the relevant Project(s). A Party receiving such Confidential Information agrees to take reasonable efforts to avoid disclosure thereof to third parties, subject to the provisions and exceptions of this Development Agreement, for a period of three (3) years from the Effective Date of this Development Agreement. Reasonable efforts shall mean efforts which are equivalent to those which the receiving Party uses to protect its own Confidential Information of a similar nature, related to the purpose of this Development Agreement. In order to be deemed Confidential Information subject to the requirements of this Section 9, the information must be identified as such with a conspicuous marking which refers to this Development Agreement by title and Effective Date as follows: "This document/hardware is to be protected from disclosure to third parties, pursuant to the Master Technical Development Agreement between Quantum Technologies and GM dated June 12, 2001." Moreover for the same period, neither Party will decompile, reverse engineer, or disassemble any Confidential Quantum Products or GM Products it receives from the other Party except as provided in a Statement of Work or otherwise approved in writing by the Party providing such products. 9.3 Return of Confidential Information. Confidential Information disclosed by a Party shall remain the property of that Party and shall be returned, at the request of the disclosing Party, upon completion of the relevant Project or upon earlier request of the disclosing Party. Notwithstanding the above, Project results identified as deliverables in a Statement of Work shall not be deemed Confidential Information. 9.4 Confidentiality of Development Agreement. Each Party agrees that the terms and conditions of this Development Agreement shall be treated as confidential and that neither Party will disclose the terms or conditions of this Development Agreement to any third party without the prior written consent of the other Party, provided, however, that each Party may disclose the terms and conditions of this Development Agreement, to the extent necessary: (a) as required by any court or other governmental body; (b) required by law; (c) in confidence to legal counsel of the Parties, accountants, and other professional advisors; (d) in confidence, to banks, investors and other financing sources and their advisors; (e) in connection with the enforcement of this Development Agreement or rights under this Development Agreement; or (f) in confidence, in connection with an actual or prospective merger or acquisition or similar transaction. With respect to disclosure required by a court or governmental order, the disclosing Party shall provide prior notification of such impending disclosure to the non-disclosing Party. 10. All reasonable efforts to preserve the confidentiality of the terms of this Development Agreement shall be expended by the disclosing Party in complying with such an order, including obtaining a protective order to the extent reasonably possible. Any SEC filings required by law shall be made after any sensitive information in the Agreement has been afforded confidential protection under applicable SEC rules and regulations. 10 Compensation. The payment obligations of GM, if any, will be described in each Statement of Work. 11 Termination 11.1 Term. The term of this Development Agreement shall commence as of the Effective Date and, unless terminated earlier in accordance with Section 11.2, shall be co-terminus with the Corporate Alliance Agreement; provided that the term of any Statement of Work will remain effective through the effective term as specified in the Statement of Work unless otherwise agreed by the Parties in writing. 11.2 Termination. (a) Material Breach. Notwithstanding Section 11.1, either Party may terminate this Development Agreement or individual Statements of Work without liability if the other Party materially breaches any of its obligations under this Development Agreement or the relevant Statement of Work (a "Default"), which Default is not cured within thirty (30) business days after the non-defaulting Party has given the defaulting Party written notice sufficiently describing the nature of the Default. Both Parties reserve the right to terminate the Development Agreement and other Statement(s) of Work upon thirty (30) business days written notice to the other Party, if a Statement of Work is breached by or on behalf of the other Party in such a manner that the terminating Party reasonably determines in its sole discretion that it is unfeasible for the terminating Party to continue its business relationship with the other Party under the Development Agreement and Statement(s) of Work. This termination right includes Quantum's rights to terminate under Section 3.1 (failure of GM to execute a Statement of Work within three (3) years of the Effective Date). (b) Mutual Consent. Notwithstanding Section 11.1, this Development Agreement may be terminated at any time by mutual consent of the Parties. (c) Rights on Termination. Upon any termination or expiration of this Development Agreement for any reason, each Party shall promptly return to the other Party or (at the other Party's option) destroy, all GM Products, GM Technology, Quantum Modifications, Quantum Products, Quantum Technology, GM Modifications, GM Program Technology, and Non-GM Program Technology of the other Party, as appropriate, delivered pursuant to this Development Agreement and the Statements of Work thereunder. Statement(s) of Work pending as of the termination of the Development Agreement shall remain in effect through the term of the applicable Statement(s) of Work unless either Party terminates the applicable Statement(s) of Work 11. separately. Deliverables called for under Statements of Work that survive termination of this Development Agreement shall not be subject to return or destruction as otherwise called for in this Section 11.2(c), until such time as the applicable Statement(s) of Work are actually terminated or reach expiration. Upon termination of any Statement(s) of Work, GM shall be entitled to updates for materials provided under such Statement(s) of Work up until the termination date, but not thereafter. 11.3 Survival. Any termination hereunder shall be in addition to any other remedy either Party may have at law or in equity, which remedies shall survive any such termination. In addition, the provisions of Sections 4 (License of Rights) as it relates to technology created before the termination date, 5 (Ownership and Patent Prosecution), 6.2 ("Rights in Data"), 7 ("Warranties and Disclaimer"), 8 ("Limitation of Liability"), 9 ("Confidentiality"), 11.2(c) ("Rights on Termination"), and 12 ("General Terms and Conditions") shall survive any termination, cancellation or expiration of this Development Agreement or Statement(s) of Work. 12 General. 12.1 Notices. All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of service if served personally on the Party to whom notice is to be given, (b) upon confirmation of receipt by fax by the Party to be notified, (c) one business day after deposit with a reputable overnight carrier, prepaid for overnight delivery and addressed as set forth in (d), or (d) upon confirmation of receipt if mailed by first class mail, registered or certified, postage prepaid, and properly addressed as follows: If to Quantum: QUANTUM TECHNOLOGIES WORLDWIDE, INC. With a copy to: Perkins Coie 17872 Cartwright Road 1620 26/th/ Street (6/th/Flr). Irvine, CA 92614 Santa Monica CA 90404 Attention: Syed Hussain, President Fax: 949-474-3086 Attention: C. Crouch Fax 310-7883399: If to GM: General Motors Corporation : 300 Renaissance Center P.O. Box 300 Detroit, MI 48265-3000 MC 482-C25-D81 Attention: General Counsel Fax: 313-667-3188
Each Party may change its address by notice given in accordance with this Section. 12.2 Export. Each Party agrees that it will not export, or attempt to export, from any country any technical data received hereunder or the product produced by use of such technical data, without first obtaining all necessary licenses and consents under 12. any applicable treaties, statutes and regulations, including, without limitation, the Export Administration Act of 1979, as amended, any successor legislation, and the Export Administration Regulations issued by the Department of Commerce, International Trade Administration, or Office of Export Licensing. Each donor Party will notify the receiving Party of any technical data or hardware that the donor Party supplies and knows to be controlled data/hardware under any of the aforesaid treaties, statutes and regulations. 12.3 Governing Law and Forum Selection. This Development Agreement shall be governed by New York law, excluding its conflict of laws rules. With the exception of either Party's right to enforce its proprietary rights through injunctive relief, all disputes arising out of this Development Agreement shall be subject to the exclusive jurisdiction and venue of the California state and federal courts located in Orange County, California, and the Parties consent to the personal and exclusive jurisdiction and venue of these courts. The Parties expressly disclaim the application of the United Nations Convention on the International Sale of Goods to this Development Agreement. 12.4 Attorneys' Fees. In the event of any action, suit or proceeding, including arbitration, between the Parties hereto, each Party shall be responsible for its own costs and attorneys' fees. 12.5 Waiver. The delay or failure of a Party to exercise any right, power, remedy, or privilege hereunder or failure to strictly enforce any breach, violation, default, provision or condition shall not impair any such right, power, remedy or privilege nor shall it constitute a waiver thereof or acquiescence thereto. Any waiver, permit, consent, or approval of any kind regarding any breach, violation, default, provision or condition of this Development Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing. No partial waiver of any such right, power, privilege, breach, violation, default, provision, or condition on any one occasion shall preclude any other or further exercise thereof or constitute a waiver thereof or acquiescence thereto on any subsequent occasion unless clear and express notice thereof in writing is provided. 12.6 Assignment. This agreement shall not be assigned by either Party without the prior written approval of the other Party except to the successor in ownership by sale, merger, consolidation or divestiture of all or substantially the whole of the relevant business (i.e. Fuel Cell Systems for GM and gaseous storage and handling equipment for Quantum) of the Party wishing to make the assignment. The Development Agreement will be binding upon and inure to the benefit of each Party's authorized successors and permitted assigns. 12.7 Captions. All Section captions and headings are for reference only and shall not be considered in interpreting or construing this Development Agreement. 12.8 Severability. If any provision of this Development Agreement is declared invalid, illegal, or unenforceable by any tribunal, then such provision shall be deemed automatically adjusted to conform to the requirements for validity as declared at such 13. time and, as so adjusted, shall be deemed a provision of this Development Agreement as though originally included herein. In the event that the provision deemed invalid, illegal or unenforceable is of such a nature that it cannot be so adjusted, the provision shall be deemed deleted from this Development Agreement as though the provision had never been included herein. If any provision or portion of this Development Agreement is held to be unenforceable or invalid, the Parties agree to negotiate, in good faith, a substitute valid provision which most nearly effects the Parties' intent in entering into this Development Agreement. In either case, the remaining provisions of this Development Agreement shall remain in full force and effect. WITHOUT LIMITING THE FOREGOING, IT IS EXPRESSLY UNDERSTOOD AND AGREED THAT EACH AND EVERY PROVISION OF THIS DEVELOPMENT AGREEMENT WHICH PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTY OR EXCLUSION OF DAMAGES IS INTENDED BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER SUCH PROVISION. FURTHER, IN THE EVENT THAT ANY REMEDY HEREUNDER IS DETERMINED TO HAVE FAILED OF ITS ESSENTIAL PURPOSE, ALL LIMITATIONS OF LIABILITY AND EXCLUSIONS OF DAMAGES SHALL REMAIN IN EFFECT. 12.9 Independent Contractors. The Parties are each independent contractors and neither Party shall be, nor represent itself to be, the franchiser, joint venturer, franchisee, partner, broker, employee, servant, agent, or legal representative of the other Party for any purpose whatsoever. Neither Party is granted any right or authority to assume or create any obligation or responsibility, express or implied, on behalf of or in the name of the other Party, or bind the other Party in any matter or thing whatsoever, including but not limited to, the right or authority to obligate the other Party to accept or deliver any order, or to sell or refuse to sell to any potential customer. 12.10 Remedies Cumulative. All remedies, either under this Development Agreement or by law or otherwise afforded to any Party, shall be cumulative and not exclusive or alternative and shall be in addition to all remedies given hereunder or now or thereafter existing, at law or in equity, by statute or otherwise. The election of any one or more remedies by any Party shall not constitute a waiver of the right to pursue other available remedies. 12.11 Injunctive Relief. The Parties acknowledge that any breach of the provisions of this Development Agreement relating to proprietary rights of either Party may cause irreparable harm and significant injury to an extent that may be difficult to ascertain. Accordingly, each Party agrees that the other Party will have, in addition to any other rights or remedies available to it at law or in equity, the right to seek injunctive relief to enjoin any breach or violation of such sections. 12.12 Force Majeure. Either Party shall be excused from any delay or failure in performance hereunder, except the payment of monies, caused by reason of any occurrence or contingency beyond its reasonable control, including but not limited to, acts of God, earthquake, floods, lightning, labor disputes and strikes, other labor or 14. industrial disturbances, riots, war, acts of the public enemy, insurrections, embargoes, blockages, regulations or orders of any government, agency or subdivision thereof, shortages of materials, rationing, utility or communication failures, casualty, novelty of product manufacture or other unanticipated product development problems, and governmental requirements. The obligations and rights of the Party so excused shall be extended on a day-to-day basis for the period of time equal to that of the underlying cause of the delay; provided that such Party shall give notice of such force majeure event to the other Party as soon as reasonably possible. 12.13 Counterparts. This Development Agreement may be executed in one or more counterparts, each of which shall constitute an original, but taken together shall constitute one and the same document. 12.14 Entire Agreement. This Development Agreement and the other agreements, documents, Exhibits, and writings attached and/or delivered pursuant hereto or concurrently herewith, including without limitation, the Corporate Alliance Agreement, the Stock Transfer Agreement, and the Registration Rights Agreement referenced therein, contain and constitute the sole, complete and entire agreement and understanding of the Parties concerning the matters contained herein and therein and may not be altered, modified or changed in any manner except by writing duly executed by the Parties. No statements, promises or representations have been made by any Party to another, or are relied upon, and no consideration has been or is offered promised, expected or held out, other than as stated in this Development Agreement or the other agreements and documents referenced herein. No Party is relying on any representations other than those expressly set forth herein or therein. No conditions precedent to the effectiveness of this Development Agreement exist, other than as may be expressly provided herein. In Witness Whereof, the Parties, by their duly authorized representatives, have executed this Agreement as of the Effective Date. Quantum Technologies, General Motors, WORLDWIDE, Inc. Corporation By: /s/ Syed F. Hussain By: /s/ Lawrence D. Burns ------------------------------- ---------------------------------- Name: Syed F. Hussain Name: Lawrence D. Burns Title: President and CEO Title: Vice President, GM Research & Development and Planning 15. EXHIBIT A --------- TEMPLATE - STATEMENT OF WORK ---------------------------------------------------------- STATEMENT OF WORK No.__ Between General Motors Corporation Global Alternative Propulsion Center And Quantum Technologies Worldwide, Inc. _________________ __, 2001 Under: Master Technology Development Agreement June 12, 2001 ---------------------------------------------------------- GAPC Project Manager ___________ (___)___-___ __________@gm.com QUANTUM Project Manager ___________ (___)___-___ __________@qtww.com 16. Table of Contents 1.0 Introduction 2.0 Program Overview 3.0 Module Description 4.0 Program Management 4.1 Expectations/Responsibilities 4.2 Project Plan 4.3 Meeting Requirements 4.3.1 Preliminary Design Review Meeting (Kick Off) 4.3.2 Design Review Meeting 4.3.3 Final Design Review Meeting 4.4 Communication 5.0 Deliverables 6.0 Timing 1.0 Introduction This Statement of Work No. __ ("SOW__") is made effective as of _____ __, 2001 ("SOW__ Effective Date"), and is governed by the Master Technical Development Agreement dated June 12, 2001 ("Development Agreement"), by and between General Motors Corporation ("GM") and Quantum Technologies Worldwide, Inc. ("Quantum"). All of the terms and conditions of the Development Agreement are incorporated herein and shall apply to this SOW__. Unless otherwise indicated, all capitalized terms shall have the meanings assigned in the Development Agreement. 2.0 Project Overview 2.1 Task 1 - Description of task and deliverables therefrom 2.2 Task 2 - Description of Task and deliverables therefrom 2.3 Task 3 - Description of Task and deliverables therefrom 3.0 Statement of Requirements See the Statement of Requirements that is attached hereto as Appendix A for detailed information regarding: GM Fuel Cell Systems (GM Products); Quantum gaseous storage and handling systems (Quantum Products), and requirements for interfacing, integration and optimization of these systems (GM Interface Technology). 4.0 Program Management 4.1 Expectations/Responsibilities 4.2 Project Plan 4.3 Meeting Requirements 17. 4.3.1 Preliminary Design Review Meeting (Kick Off) 4.3.2 Design Review Meeting 4.3.3 Final Design Review Meeting 4.4 Communication 5.0 Products and Delivery Schedules 5.1 GM Products. GM agrees to use commercially reasonable efforts to provide the following deliverables (hardware and software) to Quantum in accordance with the delivery milestones contained below. GM acknowledges that its failure to provide the GM Products in accordance with this delivery schedule may prevent Quantum from timely completion of the project (as detailed below in Section 6): --------------------------------------------------------------------- GM Products Delivery Schedule --------------------------------------------------------------------- _____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________ 5.2 Quantum Products. Quantum agrees that the following Quantum Products are to be used in the performance of this Project. Quantum acknowledges that its failure to have these Quantum Products available for use in accordance with the stated delivery schedule may prevent timely completion of the project (as detailed below in Section 6): --------------------------------------------------------------------- Quantum Products Data Available --------------------------------------------------------------------- _____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________ 6.0 Timing. The following table describes the deliverables/milestones and delivery dates within each task of the project. --------------------------------------------------------------------- Delivery/Milestone Responsible Party Date --------------------------------------------------------------------- _____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________ In Witness Whereof, an authorized representative of each party has signed this Statement of Work No. 1 as of the SOW1 Effective Date. QUANTUM TECHNOLOGIES GENERAL MOTORS CORPORATION WORLDWIDE, INC. By: __________________________________ By:_____________________________ Print Name: ___________________________ Print Name: ____________________ Title: ___________________________ Title: ____________________ 18. EX-10.33 4 dex1033.txt STOCK TRANSFER AGREEMENT Exhibit 10.33 STOCK TRANSFER AGREEMENT by and between Quantum Technologies Worldwide, Inc. and General Motors Corporation Dated June 12, 2001 CONTENTS ARTICLE 1 ACQUISITION OF SHARES......................................... 2 1.1 Defined Terms........................................... 2 1.2 Transfer................................................ 2 1.3 Consideration........................................... 3 ARTICLE 2 GM REPRESENTATIONS AND WARRANTIES............................. 4 2.1 Organization; Qualification; Good Standing.............. 4 2.2 Authorization of Agreement.............................. 4 2.3 Securities Representations.............................. 4 2.4 Securities Law Restrictions............................. 6 2.5 Market Stand-Off........................................ 6 2.6 Rights of the Company................................... 6 2.7 Ownership of Securities................................. 6 2.8 Future Acquisitions..................................... 7 ARTICLE 3 TRANSFER OF SHARES............................................ 7 3.1 Right of First Refusal.................................. 7 3.2 Exercise of Right of First Refusal...................... 7 3.3 Transfer of Shares...................................... 8 3.4 Additional Shares or Substituted Securities............. 8 3.5 Termination of Right of First Refusal................... 9 3.6 Termination of Rights as Stockholder.................... 9 3.7 Compliance with IRC Section 355......................... 9 ARTICLE 4 COMPANY REPRESENTATIONS AND WARRANTIES........................ 10 4.1 Organization; Qualification; Good Standing.............. 10 4.2 Capitalization.......................................... 10 4.3 Authorization of Agreement.............................. 11 4.4 Authorization of Shares................................. 11 4.5 Governmental Consents................................... 11 4.6 Title to Property and Assets............................ 11 4.7 Intellectual Property................................... 12 4.8 Offering Valid.......................................... 13 4.9 Litigation.............................................. 13 4.10 Compliance with Laws.................................... 13 4.11 No Defaults............................................. 14 ARTICLE 5 CONDUCT OF THE COMPANY PENDING THE CLOSING.................... 14 ARTICLE 6 CONDITIONS TO CLOSING......................................... 14 6.1 Conditions to Closing by the Company.................... 14 6.2 Conditions to Closing by GM............................. 15 ARTICLE 7 SUCCESSORS AND ASSIGNS........................................ 16 ARTICLE 8 LEGENDS....................................................... 17
ARTICLE 9 NOTICE........................................................ 18 ARTICLE 10 SURVIVAL..................................................... 18 ARTICLE 11 ENTIRE AGREEMENT............................................. 19 ARTICLE 12 CHOICE OF LAW................................................ 19 ARTICLE 13 DEFINITIONS.................................................. 19
-ii- STOCK TRANSFER AGREEMENT THIS STOCK TRANSFER AGREEMENT (this "Agreement") is entered into on June 12, 2001, by and between QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation (the "Company"), and GENERAL MOTORS CORPORATION, a Delaware corporation ("GM"). RECITALS A. This Agreement is one of several agreements to be entered into by the Company and GM concurrently, which additional agreements include that certain Corporate Alliance Agreement (the "Alliance Agreement"), that certain Master Technical Development Agreement (the "Development Agreement") and that certain Registration Rights Agreement (the "Registration Rights Agreement"). The Alliance Agreement, the Development Agreement and the Registration Rights Agreement shall sometimes be referred to herein collectively as the "Transactional Agreements." B. This Agreement and each of the Transactional Agreements shall be effective as of the date of the Closing (as hereinafter defined). C. Following the execution of this Agreement and the Transactional Agreements and prior to the Closing, IMPCO Technologies Inc., a Delaware corporation and the parent of the Company ("IMPCO"), and the Company, intend to effectuate a tax-free distribution of the Company (the "Spin-Off") in full compliance with all of the requirements of Section 355 (including Section 355(e)) of the Internal Revenue Code of 1986, as amended ("IRC"). The Company and GM hereby acknowledge that the terms set forth in this Agreement and the Transactional Agreements and the transactions contemplated hereby and thereby are intended in their application to meet the requirements of IRC Section 355 (and Section 355(e)) and hereby agree to cooperate with one another and to conduct the transactions contemplated herein and therein in such a manner as to achieve that objective. D. The Company intends to effect the Spin-Off in contemplation of conducting an initial public offering of the Company's securities to the general public ("IPO") pursuant to a registration statement to be filed under the Securities Act in connection with or following the date of the Spin-Off. NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: ARTICLE 1 ACQUISITION OF SHARES 1.1 Defined Terms. Capitalized terms not specifically defined herein (including in Article 13 hereof) are as defined in the Development Agreement. 1.2 Transfer. (a) On the terms and conditions set forth in this Agreement, the Company agrees to transfer to GM, and GM agrees to acquire, at the Closing, that number of shares of the Company's Series A Common Stock, $0.001 par value per share (the "Acquired Shares"), which, when combined with all shares of capital stock of the Company then issued and outstanding, shall equal twenty percent (20%) of the issued and outstanding shares of capital stock of the Company. (b) The Acquired Shares shall have the rights, privileges and restrictions as set forth in the Restated Certificate of Incorporation, a copy of which is attached hereto as Exhibit "A" (the "Certificate"), which the ----------- Company will, prior to the Closing, adopt and file with the Secretary of State of the state of Delaware. Such rights, privileges and restrictions shall specifically provide for anti-dilution protection whereby the number of Acquired Shares transferred hereunder shall automatically adjust to equal twenty percent (20%) of the issued and outstanding shares of capital stock of the Company through the closing of the IPO whereupon it shall convert to Common Stock. The Board of Directors shall reserve a sufficient number of authorized shares of its Common Stock for issuance upon conversion of the Acquired Shares. Except for having such additional rights, privileges and preferences as set forth in the Certificate, the Acquired Shares shall be treated in this Agreement in the same manner as, and be considered as constituting, shares of the Company's ordinary Common Stock. (c) The transfer of the Acquired Shares shall take place immediately following the effectiveness of the Spin-Off at the offices of the Company or at such other location as the Company and GM shall agree (the "Closing"). At the Closing, each of the Company and GM shall take such action and deliver all such funds, documents, certificates and other items as may be required, under this Agreement or otherwise, in order to perform or fulfill all covenants, conditions, and agreements on its part to be performed or fulfilled at or before the Closing. -2- 1.3 Consideration. The consideration to be paid by GM for the Acquired Shares shall be substantially as described in and limited by the Alliance Agreement and the Development Agreement, and consist of the following: (a) Cash. In addition to such other consideration as is set forth in ---- this Section 1.3, GM shall pay to the Company at the Closing such amount of cash as is equal to the aggregate par value of the Acquired Shares. (b) Support. GM shall actively support the Company in the performance ------- of the Company's duties under the Alliance Agreement and the Development Agreement and all other agreements related thereto by providing the following to the Company: 1. Access to GM industry expertise; 2. Introductions to significant individuals in the industry; and 3. Introductions to GM customer base for the GM Fuel Cell Systems. (c) Endorsement. GM shall publicly endorse the Company by using ----------- reasonable efforts to introduce and recommend the Company as a source of the business, and as a recommended partner for the design and supply of gaseous storage and handling systems and sub-systems, as appropriate. (d) Directed Research and Development. GM shall use its expertise and --------------------------------- knowledge of the relevant markets to direct such research and development to be performed by the Company as shall be determined appropriate to enhance the relevant business and speed its commercialization in transportation, mobile, stationary, portable and infrastructure applications, particularly in the areas of advanced gaseous storage, handling, control and integration with Fuel Cell Systems. (e) Guidance. As part of the collaborative efforts of the parties to -------- this Agreement, GM shall provide the Company with guidance in the following areas, among others, to enhance resource and skill sets: 1. The evaluation of future technology, testing procedures and general marketing proposals; -3- 2. Fuel Cell System requirements for steady state and transient operation, and the gaseous storage and handling interface and performance targets to satisfy those requirements; 3. The evaluation of resource and facility needs; and 4. The coordination of personnel and research and development, which may include the sharing or exchange of staff and resources. (f) Licenses. GM shall provide the Company with appropriate -------- foreground and background technology licenses necessary for the Company to distribute Quantum Products. ARTICLE 2 GM REPRESENTATIONS AND WARRANTIES GM hereby represents and warrants the following: 2.1 Organization; Qualification; Good Standing. GM is a corporation duly incorporated, validly existing and in good standing under the laws of the state of Delaware. GM has all requisite power and authority to carry on its business as presently conducted, to execute and deliver this Agreement and to carry out the transactions contemplated herein. GM is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to be so qualified would have a material adverse effect on its business or property. 2.2 Authorization of Agreement. The execution, delivery and performance by GM of this Agreement have been duly authorized by all requisite action of GM and its Board of Directors. This Agreement has been duly executed and delivered by GM and constitutes a valid and binding obligation of GM, enforceable against GM in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other laws of general application affecting enforcement of creditors' rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies. 2.3 Securities Representations. In connection with the issuance and acquisition of Acquired Shares under this Agreement, GM hereby represents and warrants to the Company as follows: -4- (a) GM is an "accredited investor" within the meaning of SEC Rule 501 of Regulation D, as presently in effect. (b) GM is acquiring and will hold the Acquired Shares for investment for its account only and not with a view to, or for resale in connection with, any "distribution" thereof within the meaning of the Securities Act. (c) GM understands that the Acquired Shares have not been registered under the Securities Act by reason of a specific exemption therefrom and that the Acquired Shares must be held indefinitely, unless they are subsequently registered under the Securities Act or GM obtains an opinion of counsel, in form and substance satisfactory to the Company and its counsel, that such registration is not required. GM further acknowledges and understands that the Company is under no obligation to register the Acquired Shares, except as the parties hereto may expressly agree in that certain Registration Rights Agreement of even date herewith attached hereto as Exhibit "B" or otherwise. ----------- (d) GM will not sell, transfer or otherwise dispose of the Acquired Shares in violation of the Securities Act, the Exchange Act, or the rules promulgated thereunder, including Rule 144 under the Securities Act. GM agrees that it will not dispose of the Acquired Shares unless and until it has complied with all requirements of this Agreement applicable to the disposition of Acquired Shares and it has provided the Company with written assurances, in substance and form satisfactory to the Company, that (1) the proposed disposition does not require registration of the Acquired Shares under the Securities Act or all appropriate action necessary for compliance with the registration requirements of the Securities Act or with any exemption from registration available under the Securities Act (including Rule 144) has been taken and (2) the proposed disposition will not result in the contravention of any transfer restrictions applicable to the Acquired Shares under the securities laws of any state or the rules promulgated thereunder. (e) The Company, a wholly-owned subsidiary of IMPCO, formerly conducted its business as an operating segment of IMPCO known as the Automotive OEM Division. GM acknowledges and agrees that IMPCO's existing periodic filings pursuant to the Exchange Act historically discussed the Company as a separate segment of IMPCO and provided certain information about the business activities that are now being conducted by the Company. GM acknowledges that it has been furnished with, and has had access to, such information as it considers necessary or appropriate for deciding whether to invest in the Acquired Shares, and GM has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the issuance of the Acquired Shares. -5- (f) GM is aware that its investment in the Company is a speculative investment that has limited liquidity and is subject to the risk of complete loss. GM is able, without impairing its financial condition, to hold the Acquired Shares for an indefinite period and to suffer a complete loss of its investment in the Acquired Shares. 2.4 Securities Law Restrictions. Regardless of whether the offering and transfer of Acquired Shares under this Agreement have been registered under the Securities Act or have been registered or qualified under the securities laws of any state, the Company at its discretion may impose restrictions upon the sale, pledge or other transfer of the Acquired Shares (including the placement of appropriate legends on stock certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are necessary or desirable in order to achieve compliance with the Securities Act, the securities laws of any state or any other law. 2.5 Market Stand-Off. GM agrees that it shall not, to the extent requested by the Company and an underwriter of Common Stock (or other securities) of the Company, sell or otherwise transfer or dispose (other than to donees who agree to be similarly bound) any Common Stock (or other securities) of the Company for one hundred eighty (180) days following the effective date of a registration statement of the Company filed under the Securities Act in connection with the IPO, and for ninety (90) days following the effective dates of each of the first two (2) registrations thereafter, provided that such registrations become effective within three years of such closing date. To enforce the agreement contained in this Section 2.5, the Company may impose stop-transfer instructions with respect to Common Stock held by GM until the end of such periods. The Company's underwriters shall be beneficiaries of the agreement set forth in this Section 2.5. 2.6 Rights of the Company. The Company shall not be required to (a) transfer on its books any Acquired Shares that have been sold or transferred in contravention of this Agreement or (b) treat as the owner of Acquired Shares, or otherwise to accord voting, dividend or liquidation rights to, any transferee to whom Acquired Shares have been transferred in contravention of this Agreement. 2.7 Ownership of Securities. -6- None of GM or its Affiliates own, nor have any option or right to acquire, directly or indirectly, any capital stock or other securities of IMPCO or the Company, other than the Acquired Shares, provided that a pension plan or profit sharing plan that does not buy, sell or vote securities at the order, direction or recommendation of GM shall not be deemed to be an Affiliate of GM. 2.8 Future Acquisitions. None of GM or any of its Affiliates has any plan or intention to acquire, directly or indirectly, any capital stock or other securities of IMPCO or the Company, other than the Acquired Shares, provided that a pension plan or profit sharing plan that does not buy, sell or vote securities at the order, direction or recommendation of GM shall not be deemed to be an Affiliate of GM. ARTICLE 3 TRANSFER OF SHARES 3.1 Right of First Refusal. In the event that GM proposes to sell, assign, pledge, transfer or otherwise convey ("Transfer") any Acquired Shares or other similar evidence of equity ownership or interest in the Company (collectively, the "Offered Shares"), to a third party not affiliated with GM in one or more related bona fide arms-length transactions (a "Transaction"), then GM and/or its assignee(s) shall offer in writing to the Company the right to purchase the Offered Shares on the same terms and conditions (subject, however, to any change of terms permitted under Section 3.3 below) as set forth in such written notice (the "Transfer Notice"). The Transfer Notice shall include (i) a description of the Offered Shares, (i) the identity of the prospective transferee(s), (iii) the consideration and the material terms and conditions upon which the proposed Transfer is to be made and (iv) the expected closing date for the Transaction. The Transfer Notice shall also include a copy of any written proposal, term sheet or letter of intent or other agreement relating to the proposed Transfer, and GM shall certify that it has a good faith belief that a binding agreement for the Transfer is obtainable on the terms described in, or attached to, the Transfer Notice. 3.2 Exercise of Right of First Refusal. Within thirty (30) calendar days after the date of receipt of the Transfer Notice, the Company may notify GM in writing of the Company's desire to purchase from GM all, but not less than all, of the Offered Shares at the same price, and upon the same terms (or terms as similar as reasonably possible) as described in the -7- Transfer Notice, and GM shall sell the Offered Shares to the Company pursuant to such terms. 3.3 Transfer of Shares. If the Company and/or its assignee(s) fail to exercise their Right of First Refusal to purchase all, but not less than all, of the Offered Shares within thirty (30) calendar days after the date of receipt of the Transfer Notice, GM may, not later than ninety (90) calendar days following receipt of the Transfer Notice by the Company, conclude a transfer of the Offered Shares subject to the Transfer Notice on the terms and conditions described in the Transfer Notice, provided that any such sale is made in compliance with applicable federal and state securities laws and not in violation of any other contractual restrictions to which GM is bound, and provided further, that the Transferee agrees, prior to such transfer, to receive and hold the Offered Shares subject in all respects to the provisions of this Agreement. Any proposed transfer on terms and conditions materially different from those described in the Transfer Notice, as well as any subsequent proposed transfer by GM, shall again be subject to the Right of First Refusal and shall require compliance with the procedure described in Section 3.1 above. If the Company and/or its assignee(s) exercise the Right of First Refusal and purchase all of the Offered Shares, the parties shall consummate the sale of the Offered Shares on the terms set forth in the Transfer Notice within sixty (60) calendar days after the date when the Company received the Transfer Notice (or within such longer period as may have been specified in the Transfer Notice); provided, however, that in the event the Transfer Notice provided that payment for the Offered Shares was to be made in a form other than cash or cash equivalents paid at the time of transfer, the Company or its assignee(s) shall have the option of paying for the Offered Shares with cash or cash equivalents equal to the Fair Market Value of the consideration described in the Transfer Notice. 3.4 Additional Shares or Substituted Securities. In the event of the declaration of a stock dividend, the declaration of an extraordinary dividend payable in a form other than stock, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company's outstanding securities without receipt of consideration, any new, substituted or additional securities or other property (including money paid other than as an ordinary cash dividend) which are by reason of such transaction distributed with respect to any Acquired Shares subject to this Article 3 or into which such Acquired Shares thereby become convertible shall immediately be subject to this Article 3 and shall, for all purposes of this Agreement, be considered as Acquired Shares. -8- Appropriate adjustments to reflect the distribution of such securities or property shall be made to the number and/or class of Acquired Shares subject to this Article 3. 3.5 Termination of Right of First Refusal. The Right of First Refusal shall terminate and be of no force and effect immediately upon the earliest to occur of (a) the first date on which the Company's Common Stock is held of record by more than five hundred (500) persons, (b) a determination is made by the Board of Directors that a public market exists for the outstanding Acquired Shares, or (c) the effective date of a firm commitment underwritten public offering, pursuant to an effective registration statement on Form S-1 or Form SB-2 under the Securities Act, covering the offer and sale of the Company's Common Stock. Notwithstanding the foregoing language contained in this Section 3.5, the Right of First Refusal shall continue for a period of three (3) years following the date of this Agreement with respect to any negotiated transaction between GM and any other Person. The effectiveness of the Market Stand-Off set forth in Section 2.5 shall not be affected by the termination of this Right of First Refusal. 3.6 Termination of Rights as Stockholder. If the Company or its assignee(s) make available, at the time and place and in the amount and form provided in this Agreement, the consideration for the Offered Shares to be Acquired in accordance with Section 3.3 above, then after such time the person from whom such Offered Shares are to be Acquired shall no longer have any rights as a holder of such Offered Shares (other than the right to receive payment of such consideration in accordance with this Agreement). Such Offered Shares shall be deemed to have been Acquired in accordance with the applicable provisions hereof, whether or not the certificate(s) therefor have been delivered as required by this Agreement. In the event such certificate(s) are not delivered as required hereunder, GM hereby irrevocably constitutes and appoints any duly elected secretary of the Company to transfer the Offered Shares on the books of the Company with full power of substitution. 3.7 Compliance with IRC Section 355. None of GM or its Affiliates shall take or fail to take any action that could cause or reasonably be expected to contribute to the failure of the Spin-Off to qualify under IRC Section 355 or that could cause or reasonably be expected to cause the provisions of IRC Section 355(e) to apply to those transactions. -9- ARTICLE 4 COMPANY REPRESENTATIONS AND WARRANTIES Except as set forth in Exhibit "C" attached hereto and except as affected ----------- by the transactions contemplated hereby, the Company hereby represents and warrants the following: 4.1 Organization; Qualification; Good Standing. The Company is a corporation duly incorporated, validly existing and in good standing under the laws of the state of Delaware. The Company has all requisite corporate power and authority to carry on its business as presently conducted, to execute and deliver this Agreement and to carry out the transactions contemplated herein. The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to be so qualified would have a material adverse effect on its business or property. 4.2 Capitalization. The Company is authorized to issue Fifty Million (50,000,000) shares of capital stock, consisting of: (a) Thirty-Five Million (35,000,000) shares of common stock, $0.001 par value per share (the "Common Stock"), of which Ten Million (10,000,000) shares are issued and outstanding; and (b) Fifteen Million (15,000,000) shares of preferred stock, par value $0.001 per share (the "Preferred Stock"), none of which are issued and outstanding. Subject to the limitations set forth in the Company's Certificate of Incorporation, as amended or corrected to date, the Board of Directors has the right to create and file the designations, preferences and rights of the Preferred Stock. (c) A list of all holders of Common Stock as of the date of this Agreement, including the number of shares held by each such holder, is attached as Schedule 4.2(c) to Exhibit "C" hereto. ----------- (d) Except as set forth in this Agreement and the Exhibits hereto, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally or in writing, for the purchase or acquisition from the Company of any shares of its capital stock. -10- 4.3 Authorization of Agreement. The execution, delivery and performance by the Company of this Agreement has been duly authorized by all requisite action of the Company and its Board of Directors. This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other laws of general application affecting enforcement of creditors' rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies. 4.4 Authorization of Shares. The issuance and delivery of the Acquired Shares at the Closing will be duly authorized by all requisite action of the Company. When so issued and delivered, the Acquired Shares will be validly issued and outstanding, fully paid and nonassessable and, based in part upon the representations of GM herein, will be issued in compliance with all applicable federal and state securities laws, and will be free of restrictions on transfer other than restrictions on transfer contemplated by this Agreement and under applicable state and federal securities laws. 4.5 Governmental Consents. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state, local or provincial governmental authority on the part of the Company is required in connection with the consummation of the transactions contemplated by this Agreement, except for compliance with the requirements of the HSR Act, if applicable, and any notices of sale required to be filed with the SEC under Regulation D of the Securities Act or such post-closing filings as may be required pursuant to applicable state securities laws, which filings will be effected within the applicable periods therefor following the Closing. 4.6 Title to Property and Assets. The Company owns its property and assets free and clear of all mortgages, liens, loans and encumbrances, except such mortgages, liens, loans and encumbrances which arise in the ordinary course of business and do not materially impair the Company's ownership or use of such property or assets. With respect to the property and assets it leases, the Company is in material compliance with such leases and, to its knowledge, holds a valid leasehold interest free of any liens, claims -11- or encumbrances. All facilities, equipment, fixtures, vehicles and other properties owned, leased or used by the Company are in good operating condition and repair and are reasonably fit and usable for the purposes for which they are being used. 4.7 Intellectual Property. (a) To the best of its knowledge with respect to patents, trademarks, service marks and trade names only (without having conducted any special investigation or patent or trademark search), the Company owns or possesses sufficient rights to all patents, patent applications, trade names, trademarks, trademark applications, trade dress, service marks, copyright, trade secrets, information, proprietary rights and processes ("Intellectual Property") necessary for its business as it has historically been conducted as the Automotive OEM Division of IMPCO as further described in Section 2.3(e) hereof without any material conflict with, or infringement of, the rights of others. The Company has not received any communications alleging that the Company is violating or, by conducting its business as proposed, would materially violate any of the Intellectual Property of any other person or entity. (b) To the Company's knowledge none of its employees, officers or consultants is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with the use of such employee's, officer's or consultant's best efforts to promote the interests of the Company or that would conflict with the Company's business. Neither the execution nor delivery of this Agreement nor the carrying on of the Company's business by the employees and officers of and consultants to the Company will, to the Company's knowledge, conflict with or result in a breach of the terms, conditions or provisions of, or constitute a material default under, any contract, covenant or instrument under which any of such employees, officers or consultants is now obligated. (c) Each of the Company's former and current employees, officers and consultants has entered into an Inventions and Confidential Information Agreement in substantially the forms attached hereto as Exhibit "D." ------------ "Inventions" means all inventions, developments and discoveries which during the period of an individual's service to the Company he or she makes or conceives of, either solely or jointly with others, that relate to any subject matter with which his or her work for the Company may be concerned, or relate to or are connected with the business, products, services or projects of the Company, or relate to the actual or demonstrably anticipated research or development of the Company or involve the use of the Company's funds, -12- time, material, facilities or trade secret information, except as excluded pursuant to applicable law. (d) For purposes of this Agreement, unless otherwise provided, the term "knowledge" shall mean the current actual awareness of information about facts by the officers of the Company based upon their due inquiry. 4.8 Offering Valid. Assuming the accuracy of the representations and warranties of GM contained in Article 2 hereof, the offer, sale and issuance of the shares of the Acquired Shares will be exempt from the registration requirements of the Securities Act and will have been registered or qualified (or are exempt from registration and qualification) under the registration, permit or qualification requirements of applicable state securities laws. Neither the Company nor any agent on its behalf has solicited or will solicit any offers to purchase or has offered to sell or will offer to sell all or any part of the shares of Common Stock to any person or persons so as to bring the sale of such shares by the Company within the registration provisions of the Securities Act or any state securities laws. 4.9 Litigation. Except as disclosed in Schedule 4.9 to Exhibit "C" hereto, there is no ----------- action, suit, customer claim, proceeding or investigation by or before any individual, entity, court, governmental instrumentality or other agency pending or, to the knowledge of the Company, threatened, against the Company which relates to the Company or its business operations or questions the validity of this Agreement or the right of the Company to enter into it, or to consummate the transactions contemplated hereby, that the Company reasonably believes will have, either individually or in the aggregate, any material adverse effect on the business, assets, properties, condition or operations of the Company. The Company is not a party or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. Except as described in the above-referenced Schedule, there is no action, suit, proceeding or investigation by the Company currently pending or which the Company intends to initiate. 4.10 Compliance with Laws. The Company is not in violation of any applicable statute, rule, regulation, order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties, which violation would materially and adversely affect the -13- business, assets, liabilities, financial condition, operations or prospects of the Company. 4.11 No Defaults. To the knowledge of the Company, there presently exists no material default under any material contract, agreement or instrument to which the Company is a party or by which it or any of its property is bound or affected and there presently exists no condition, event or act which constitutes, or which after notice, lapse of time or both, would constitute, a material default by the Company of any of the foregoing. ARTICLE 5 CONDUCT OF THE COMPANY PENDING THE CLOSING The business of the Company shall be conducted only in, and the Company shall not take any action except in, and the directors and officers of the Company shall cause the Company to be conducted in, the ordinary course of business and in a manner consistent with past practice and in accordance with applicable law; and the Company shall use all commercially reasonable efforts to preserve substantially intact the business organization of the Company, to keep available the services of the current directors, officers, employees and consultants of the Company and to preserve the current relationships of the Company with customers, suppliers and other persons with which the Company has significant business relations. The Company agrees to confer with GM in connection with the preparation and adoption of any employee incentive stock option or similar plan contemplated to be effectuated prior to or following the Closing. ARTICLE 6 CONDITIONS TO CLOSING 6.1 Conditions to Closing by the Company. The obligations of the Company to GM under this Agreement are subject to the fulfillment of the following conditions, unless waived in writing by the Company, and provided that the Company shall utilize its best efforts to cause the fulfillment of those conditions the fulfillment of which is under its reasonable control: (a) The Form 10 Registration Statement to be filed by IMPCO with the SEC related to the Spin-Off ("Form 10") shall have become effective and the Spin-Off shall have been consummated. -14- (b) The Company's Shares shall have been qualified for listing on Nasdaq or other appropriate stock exchange. (c) The Certificate shall have been filed with the Secretary of State of the state of Delaware. (d) The representations and warranties of GM contained in Article 2 shall be true on and as of the Closing with the same effect as though such representations had been made as of the Closing. (e) GM shall have executed each of the Transactional Agreements and other documents evidencing its commitment to provide the consideration specified in Section 1.3. (f) The transfer of the Acquired Shares to GM shall be qualified or exempt from qualification under all applicable federal and state securities laws as of the Closing. (g) GM shall have performed and complied with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing and shall not be in breach of any agreement or covenant of GM contained herein. (h) GM shall have delivered to the Company the cash consideration specified in Section 1.3. 6.2 Conditions to Closing by GM. The obligations of GM to the Company under this Agreement are subject to the fulfillment of the following conditions, unless waived in writing by GM, and provided that GM shall utilize its best efforts to cause the fulfillment of those conditions the fulfillment of which is under its reasonable control: (a) The Form 10 shall have become effective and the Spin-Off shall have been consummated. (b) The Company's Shares shall have been qualified for listing on Nasdaq or other appropriate stock exchange. (c) The Certificate shall have been filed with the Secretary of State of the state of Delaware. -15- (d) The representations and warranties of the Company contained in Article 4 shall be true on and as of the Closing with the same effect as though such representations had been made as of the Closing. (e) The Company shall have executed each of the Transactional Documents. (f) The Company shall have delivered to GM documentation evidencing the transfer of assets from IMPCO to the Company prior or incidental to the Closing, sufficient in amount to permit the Company to operate as a stand alone business as of the Closing. (g) The Company shall have entered into an employment agreement with Syed F. Hussain committing him to no less than three (3) years' continued service with the Company and containing appropriate incentives designed to induce his continued loyalty to the Company for a reasonable period thereafter. (h) The transfer of the Acquired Shares to GM shall be qualified or exempt from qualification under all applicable federal and state securities laws as of the Closing. (i) The Company shall have performed and complied with all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing and shall not be in breach of any agreement or covenant of the Company contained herein. (j) The Company shall have delivered to GM the certificate or certificates evidencing the Acquired Shares specified in Section 1.2. ARTICLE 7 SUCCESSORS AND ASSIGNS Except as otherwise expressly provided to the contrary, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and GM and their successors and assigns, whether or not any such successor or assign has become a party to this Agreement or has agreed in writing to join herein and to be bound by the terms, conditions and restrictions hereof. -16- ARTICLE 8 LEGENDS Legends. All certificates evidencing Acquired Shares shall bear the following legends: "THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE HOLDER). SUCH AGREEMENT GRANTS TO THE COMPANY CERTAIN RIGHTS OF FIRST REFUSAL UPON AN ATTEMPTED TRANSFER OF THE SHARES. THE SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE." "THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED." "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A MARKET STANDOFF RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS AFTER THE EFFECTIVE DATE OF THE INITIAL PUBLIC OFFERING OF THE COMMON STOCK OF THE ISSUER HEREOF AND FOR 90 DAYS AFTER THE EFFECTIVE DATES OF EACH OF THE FIRST TWO REGISTRATIONS THEREAFTER PROVIDED, -17- THAT SUCH REGISTRATIONS BECOME EFFECTIVE WITHIN THREE YEARS OF SUCH CLOSING DATE. SUCH RESTRICTION IS BINDING ON PURCHASERS OF THESE SHARES." If required by the authorities of any state in connection with the issuance of the Acquired Shares, the legend or legends required by such state authorities shall also be endorsed on all such certificates. ARTICLE 9 NOTICE Any notice required by the terms of this Agreement shall be given in writing and shall be (a) mailed by registered or certified mail, postage prepaid, return receipt requested, (b) delivered by a nationally recognized overnight courier, (c) sent by conformed facsimile or (d) otherwise delivered by hand or by messenger. Notice shall be addressed to the Company at its principal executive office and to GM at the address listed on the signature page hereof or at such other address as such party may designate by ten (10) days' advance written notice to the other party given in the foregoing manner. If notice is provided by mail, notice shall be deemed to be given upon receipt as evidenced by postal records; if by overnight courier, notice shall be deemed to be given twenty-four (24) hours after deposit; if by facsimile, upon completion of such facsimile transmission as conclusively evidenced by the transmission receipt; and if by hand or messenger, upon receipt. ARTICLE 10 SURVIVAL All representations and warranties contained in this Agreement or the Transactional Agreements, and obligations under covenants and agreements contained herein or therein to be performed or complied with before the Closing, shall be deemed to be continuing and shall survive the Closing, but shall expire on the third anniversary of the date of this Agreement unless a specific claim in writing with respect to any such matter shall have been made or an action or proceeding at law or in equity shall have been commenced or filed before such anniversary date. The covenants and agreements contained in this Agreement and the Transactional Agreements that contemplate obligations or performance after the Closing shall survive the Closing and shall continue until all obligations with respect thereto shall have been performed or satisfied or shall have been terminated in accordance with their terms. -18- ARTICLE 11 ENTIRE AGREEMENT This Agreement and the other agreements, documents, exhibits, and writings attached and/or delivered pursuant hereto or entered into concurrently herewith, including, without limitation, the Transactional Agreements entered into by the parties hereto, constitute the entire contract between the parties hereto with regard to the subject matter hereof and thereof, and supersede any other agreements, representations or understandings (whether oral or written and whether express or implied) relating to the subject matter hereof and thereof. ARTICLE 12 CHOICE OF LAW This Agreement shall be governed by, and construed in accordance with, the laws of the state of Delaware, as such laws are applied to contracts entered into and to be performed entirely within such state. ARTICLE 13 DEFINITIONS 13.1 "Affiliate" shall mean with respect to any Person, any other Person that controls, is controlled by or is under common control with, such first Person. As used herein, "control" shall mean, with respect to any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or other interests, by contract or otherwise. 13.2 "Board of Directors" shall mean the Board of Directors of the Company, as constituted from time to time. 13.3 "Consideration" shall mean the amount for which the Acquired Shares may be Acquired pursuant to this Agreement, as specified in Section 1.3. 13.4 "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and all rules promulgated thereunder. 13.5 "Fair Market Value" shall mean the fair market value of a Share or of offered consideration at the time of closing of the relevant transaction as determined by the Board of Directors in good faith following a review of relevant factors and advice from independent legal and accounting advisors. Such determination shall be conclusive and binding on all persons. -19- 13.6 "HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. 13.7 "Person" shall mean any natural person or a corporation, general or limited partnership, limited or unlimited liability company, trust, joint venture, association, company, unincorporated organization or other entity. 13.8 "Right of First Refusal" shall mean the right of first refusal of the Company and its assignees described in Article 3. 13.9 "SEC" shall mean the Securities and Exchange Commission. 13.10 "Securities Act" shall mean the Securities Act of 1933, as amended, and all rules promulgated thereunder. 13.11 "Spin-Off" shall mean the distribution pro rata to IMPCO's stockholders of Shares of the Company's Common Stock as further described in the Recitals hereto. 13.12 "Share" shall mean one share of Common Stock. 13.13 "Transferee" shall mean any Person to whom GM has directly or indirectly transferred any Acquired Share. -20- IN WITNESS WHEREOF, the parties have executed this Agreement on June 12, 2001. COMPANY: QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation By: /s/ Syed F. Hussain ______________________________________ Name: Syed F. Hussain Title: President and CEO Address: 17872 Cartwright Road Irvine, CA 92614 Telephone: (949) 399-4511 Facsimile: (949) 474-3086 GENERAL MOTORS CORPORATION, a Delaware corporation By: /s/ Lawrence D. Burns ______________________________________ Name: Lawrence D. Burns Title: Vice President, GM Research & Development and Planning Address: 30500 Mound Road M/C: 480-106-EX2 Warren, MI 48090-9055 Telephone: (810) 986-2500 Facsimile: (810) 986-6347 -21- EXHIBIT "A" RESTATED CERTIFICATE OF INCORPORATION -22- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT RESTATED CERTIFICATE OF INCORPORATION OF QUANTUM TECHNOLOGIES WORLDWIDE, INC. Quantum Technologies Worldwide, Inc., a Delaware corporation, hereby certifies that: 1. The name of this Corporation is QUANTUM TECHNOLOGIES WORLDWIDE, INC. The date of filing its original Certificate of Incorporation with the Secretary of State was October 13, 2000. The prior name of the Corporation was Quantum Technologies, Inc. 2. This Restated Certificate of Incorporation of the Corporation attached hereto as Exhibit "A," which is incorporated herein by this reference, and which restates, integrates and further amends the provisions of the Certificate of Incorporation as heretofore amended or supplemented, has been duly adopted by the Corporation's Board of Directors and a majority of the stockholders in accordance with Sections 242 and 245 of the Delaware General Corporation Law ("DGCL"), with the approval of the Corporation's stockholders having been given by written consent without a meeting in accordance with Section 228 of the DGCL. IN WITNESS WHEREOF, this Corporation has caused this Restated Certificate of Incorporation to be signed by its duly authorized officer and the foregoing facts stated herein are true and correct. DATED: _______________________ QUANTUM TECHNOLOGIES WORLDWIDE, INC. By: ___________________________ Syed F. Hussain, President EXHIBIT "A" TO STOCK TRANSFER AGREEMENT EXHIBIT "A" RESTATED CERTIFICATE OF INCORPORATION OF QUANTUM TECHNOLOGIES WORLDWIDE, INC. I. Name The name of the Corporation is QUANTUM TECHNOLOGIES WORLDWIDE, INC. (hereinafter sometimes referred to as the "Corporation"). II. Registered Office and Agent The address of the registered office of the Corporation in the State of Delaware is 15 E. North Street, Dover, DE 19901, in the City of Dover, County of Kent. The name of its registered agent at such address is AmeriSearch Corporate Services, Inc. III. Purposes The nature of the business of the Corporation and the objects or purposes to be transacted, promoted or carried on by it are as follows: to engage in any lawful act or activity for which corporations may be organized under the Delaware General Corporation Law. IV. Shares The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is Fifty Million (50,000,000) shares, consisting of Thirty-five Million (35,000,000) shares of Common Stock with a par value of $0.001 per share (the "Common Stock") and Fifteen Million (15,000,000) shares of Preferred Stock with a par value of $0.001 per share. A. Preferred Stock. Any of the shares of Preferred Stock authorized by --------------- this Certificate of Incorporation may be issued from time to time in one or more series. Subject to the limitations and restrictions set forth in this Article IV, the Board of Directors, by resolution or resolutions, is authorized to create or provide for any such series and to fix the designations, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including, without limitation, the authority to fix or alter the dividend rights, dividend rates, conversion rights, exchange rights, voting rights, rights and terms of redemption (including sinking and purchase fund provisions), the redemption price or prices, the dissolution preferences -2- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT and the right in respect to any distribution of assets of any wholly unissued series of Preferred Stock and the number of shares constituting any such series, and the designation thereof, or any of them and to increase or decrease the number of shares of any series so created, subsequent to the issue of that series but not below the number of shares of such series then outstanding. In case the number of shares of any series shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the number of shares of such series. There shall be no limitation or restriction on any variation between any of the different series of Preferred Stock as to the designation, preferences and relative, participating, optional or other special rights, and the qualification, limitations or restrictions thereof; and the several series of Preferred Stock may, except as hereinafter otherwise expressly provided, vary in any and all respects as fixed and determined by the Board of Directors, providing for the issuance of the various series; provided, however, that all shares of any one series of Preferred Stock shall have the same designation, preferences, and relative, participating, optional or other special rights and qualifications, limitations and restrictions. Except as otherwise required by law, or as otherwise fixed by resolution or resolutions of the Board of Directors with respect to one or more series of Preferred Stock, the entire voting power and all voting rights shall be vested exclusively in the Common Stock, and each stockholder of the Corporation who at the time possesses voting power for any purpose shall be entitled to one vote for each share of such stock standing in such stockholder's name on the books of the Corporation. The Corporation shall exercise its power to issue Preferred Stock with the view of avoiding the issuance of fractional shares. No stockholder shall have the right to split the whole shares into fractions. B. Common Stock. Any of the shares of Common Stock authorized by this ------------ Certificate of Incorporation may be issued from time to time in one or more series. Subject to the limitations and restrictions set forth in this Article IV, the Board of Directors, by resolution or resolutions, is authorized to create or provide for any such series and to fix the designations, preferences and relative rights and restrictions thereof. Thirty Million (30,000,000) shares of the authorized shares of Common Stock are hereby designated Common Stock (the "Common Stock") and Five Million (5,000,000) shares of the authorized shares of Common Stock are hereby designated Series A Common Stock (the "Series A Common"). The relative rights, preferences, privileges and restrictions granted to or imposed upon the Corporation's Common Stock, Series A Common, or upon the holders thereof, are as follows: 1. Dividends. The holders of shares of all series of Common Stock --------- shall be entitled to receive such dividends as from time to time may be declared by the Board of Directors of the Corporation, subject to the provisions of Subdivision A of this -3- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT Article IV with respect to rights of holders of the Preferred Stock. The holders of all series of Common Stock shall share ratably, based upon the number of shares of Common Stock or Series A Common held by them, in all dividends to which the holders of Common Stock may be entitled. 2. Liquidation. Upon any liquidation, dissolution or winding up of ----------- the Corporation, whether voluntary or involuntary, after any preferential amounts to be distributed to the holders of any series of Preferred Stock then outstanding, the holders of all series of Common Stock shall share ratably, based upon the number of shares of Common Stock or Series A Common held by them, in all of the remaining assets of the Corporation available for distribution to its stockholders. 3. Voting Rights. Except as otherwise provided by law and subject ------------- to the provisions set forth in this Article IV, the holders of all series of Common Stock issued and outstanding shall be entitled to vote one vote for each share thereof held on all matters. 4. Designation of Rights and Preferences of Series A Common. The -------------------------------------------------------- Series A Common authorized under this Certificate of Incorporation shall be convertible into shares of this corporation's Common Stock, as described in Section 4.2 below. In addition to the rights, preferences, restrictions and other matters relating to all series of Common Stock described above, the Series A Common shall have the following additional rights: 4.1. Anti-Dilution Protection. As provided in this Section 4.1, ------------------------ the number of outstanding shares of Series A Common shall be subject to adjustment from time to time upon the occurrence of certain events, the purpose of which adjustment or adjustments shall be for the number of shares of issued and outstanding Series A Common to equal twenty percent (20%) of the issued and outstanding shares of all series of Common Stock of the Corporation (the "Issued and Outstanding Common Shares"); provided, however, that the Issued and Outstanding Common Shares shall specifically exclude any shares of Common Stock and options therefor issued to directors, officers, employees or consultants of the Corporation pursuant to a stock option or other equity incentive plan or agreement approved by the Board of Directors of the Corporation (a "Plan"). 4.1(a) Upon the happening of an Extraordinary Common Stock Event (as defined below) after June 12, 2001, the number of outstanding shares of Series A Common shall be adjusted to a number equal to that number of shares of Common Stock determined by multiplying the number of the then Issued and Outstanding Common Shares by twenty percent (20%). The adjustment shall occur automatically without the need for any action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Corporation or its transfer -4- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT agent; provided, however, that the Corporation shall not be obligated to issue certificates evidencing the shares of Series A Common issuable upon such adjustment but shall maintain adequate records, accessible to each holder of Series A Common, setting forth the effective date of the adjustment, the amount of the required adjustment and the computation thereof. The number of shares of outstanding Series A Common, as so adjusted, shall be readjusted in the same manner upon the happening of any successive Extraordinary Common Stock Event or Events. 4.1(b) "Extraordinary Common Stock Event" shall mean (i) the issuance of additional shares of Common Stock other than shares of Common Stock and options therefore issued pursuant to a Plan; (ii) the issuance of additional shares of Common Stock as a dividend or other distribution on outstanding Common Stock of the Corporation, (iii) a subdivision of outstanding shares of Common Stock into a greater number of shares of Common Stock, of (iv) a combination of outstanding shares of Common Stock into a smaller number of shares of Common Stock. 4.2 Automatic Conversion. Upon the closing of an initial -------------------- public offering of the Corporation's securities to the general public ("IPO") pursuant to a registration statement of the Corporation filed under the Securities Act of 1933, as amended to date, the outstanding shares of Series A Common shall automatically be converted into that number of shares of Common Stock that would be equal to twenty percent (20%) of the Issued and Outstanding Common Shares immediately following the closing of the IPO. The Corporation shall, as soon as practicable after the closing date of the IPO (the "Closing Date"), issue and deliver to the holder of the outstanding shares of Series A Common, a certificate or certificates for the number of shares of Common Stock to which it shall be entitled as aforesaid. Such conversion shall be deemed to have been made immediately prior to the close of business on the Closing Date, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock. Upon such conversion and notwithstanding that the certificates evidencing such shares of Series A Common shall not have been surrendered, the shares so converted shall be deemed canceled and shall not be issuable by this Corporation, the rights of the holders of the Series A Common with respect to such shares shall terminate and the authority of the Corporation to issue shares of Series A Common Stock shall terminate. The Certificate of Incorporation of this Corporation shall be appropriately amended to effect the change in the Corporation's authorized capital stock. V. Board of Directors The Board of Directors is expressly authorized to make, alter, or repeal the Bylaws of the Corporation. -5- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT VI. Election of Directors Elections of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide. The number of directors shall be fixed from time to time by the Board of Directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not there exist any vacancies in the previously authorized directorships at the time any such resolution is presented to the Board for adoption). VII. Creditors Whenever a compromise or arrangement is proposed between the Corporation and its creditors or any class of them and/or between the Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may, on the application in a summary way of the Corporation or of any creditor or stockholder thereof, or on the application of any receiver or receivers appointed for the Corporation under the provisions of Section 291 of Title 8 of the Delaware Code or on the application of trustees in dissolution or of any receiver or receivers appointed for the Corporation under the provisions of Section 279 of Title 8 of the Delaware Code order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders of the Corporation, as the case may be, to be summoned in such manner as the said court directs. If a majority in number representing three- fourths in value of the creditors or class of creditors, and/or the stockholders or class of stockholders of the Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of the Corporation as a consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of the Corporation, as the case may be, and also on the Corporation. VIII. Amendments The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statutes, and all rights conferred upon stockholders herein are granted subject to this reservation. IX. Director Liability A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional -6- EXHIBIT "A" TO STOCK TRANSFER AGREEMENT misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived any improper personal benefit. If the Delaware General Corporation Law is amended after approval by the stockholders of this Article to authorize corporation action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law as so amended. IN WITNESS WHEREOF, said Corporation has caused this Certificate of Amendment to be signed by its duly authorized officer this __ day of _____________, 2001 and the foregoing facts stated herein are true and correct. QUANTUM TECHNOLOGIES WORLDWIDE, INC. By:___________________________________ Syed F. Hussain, President -7- EXHIBIT "B" REGISTRATION RIGHTS AGREEMENT (Omitted) -8- EXHIBIT "C" COMPANY EXCEPTIONS Schedule 4.2(c) CAPITALIZATION (as of June 12, 2001)
Number of Percentage Stockholder Shares Ownership ----------- ------ --------- IMPCO 10,000,000 100%
[See Following Page] -9- Schedule 4.9 LITIGATION (as of June 12, 2001) IMPCO Technologies, Inc. v. GFI Control Systems, Inc. and Dynatek Industries, - ----------------------------------------------------------------------------- Ltd. - ---- No. 00-73633, U.S. District Court, Eastern District, MI (filed August 11, 2000) -10- EXHIBIT "D" FORMS OF INVENTIONS AND CONFIDENTIAL INFORMATION AGREEMENTS -11- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT FORM OF NEW Quantum Technologies Worldwide, Inc. Inventions and Confidential Information Agreement In consideration of, and as a condition of, my employment with Quantum Technologies Worldwide, Inc., a Delaware corporation (the "Company"), I hereby represent to, and agree with, the Company as follows: Section 1. Definitions 1.1 "Agreement" means this Inventions and Confidential Information Agreement. 1.2 "Competing Business" means any business whose efforts are in competition with the efforts of the Company. A Competing Business includes any business whose efforts involve any research and development, products or services in competition with products or services which are, during and at the end of the Term, either (a) produced, marketed or otherwise commercially exploited by the Company or (b) in actual or demonstrably anticipated research or development by the Company. 1.3 "Confidential Information" means any information that (a) relates to the business of the Company, (b) is not generally available to the public, and (c) is conceived, compiled, developed, discovered or received by, or made available to, me during the Term, whether solely or jointly with others, and whether or not while engaged in performing work for the Company. Confidential Information includes information, both written and oral, relating to Inventions, trade secrets and other proprietary information, technical data, products, services, finances, business plans, marketing plans, legal affairs, suppliers, clients, prospects, opportunities, contracts or assets of the Company. Confidential Information also includes any information which has been made available to the Company by or with respect to third parties and which the Company is obligated to keep confidential. 1.4 "Invention" means any product, device, technique, know-how, computer program, algorithm, method, process, procedure, improvement, discovery or invention, whether or not patentable or copyrightable and whether or not reduced to practice, that (a) is within the scope of the Company's business, research or investigations or results from or is suggested by any work performed by me for the Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement EXHIBIT "D" TO STOCK TRANSFER AGREEMENT Company and (b) is created, conceived, reduced to practice, developed, discovered, invented or made by me during the Term, whether solely or jointly with others, and whether or not while engaged in performing work for the Company. 1.5 "Material" means any product, prototype, model, document, diskette, tape, picture, design, recording, writing or other tangible item which contains or manifests, whether in printed, handwritten, coded, magnetic or other form, any Confidential Information, Invention or Proprietary Right. 1.6 "Person" means any corporation, partnership, trust, association, governmental authority, educational institution, individual or other entity. 1.7 "Proprietary Right" means any patent, copyright, trade secret, trademark, trade name, service mark, maskwork or other protected intellectual property right in any Confidential Information, Invention or Material. 1.8 "Term" means the term of my employment with the Company, whether on a full-time, part-time or consulting basis. Section 2. Purpose of Agreement 2.1 I understand that the Company is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Company to preserve and protect its Proprietary Rights, including its Confidential Information, its rights in Inventions and in all related intellectual property rights. Accordingly, I am entering into this Agreement as a condition of my employment with the Company, whether or not I am expected to create inventions of value for the Company. Section 3. Ownership and Use 3.1 The Company will be the exclusive owner of all Confidential Information, Inventions, Materials and Proprietary Rights. To the extent applicable, all Materials will constitute "works for hire" under applicable copyright laws. 3.2 I assign and transfer, and agree to assign and transfer, to the Company all rights and ownership that I have or will have in Confidential Information, Inventions, Materials and Proprietary Rights, subject to the limitations set forth in Section 3.5 and in the notice set forth in Section 3.6 below. Further, I waive any moral rights that I may have in any Confidential Information, Inventions, Materials and Proprietary Rights. I will take such action (including signature and assistance in preparation of documents or the giving of testimony) as may be requested by the Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -2- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT Company to evidence, transfer, vest or confirm the Company's rights and ownership in Confidential Information, Inventions, Materials and Proprietary Rights. I agree to keep and maintain adequate and current written records of all Inventions and Proprietary Rights during the Term. The records will be in the form of notes, sketches, drawings, and any other format that may be specified by the Company. The records will be available to and remain the sole property of the Company at all times. I will not contest the validity of any Proprietary Right, or aid or encourage any third party to contest the validity of any Proprietary Right of the Company. If the Company is unable for any reason to secure my signature to fulfill the intent of the foregoing paragraph or to apply for or to pursue any application for any United States or foreign patents or copyright registrations covering Inventions assigned to the Company above, then I irrevocably appoint the Company and its authorized agents as my agent and attorney in fact, to transfer, vest or confirm the Company's rights and to execute and file any such applications and to do all other lawful acts to further the prosecution and issuance of letters patent or copyright registrations with the same legal force as if done by me. 3.3 Except as required for performance of my work for the Company or as authorized in writing by the Company, I will not (a) use, disclose, publish or distribute any Confidential Information, Inventions, Materials or Proprietary Rights or (b) remove any Materials from the Company's premises. 3.4 I will make prompt and full disclosure to an officer of the Company, or to any individual designated by the Company for that purpose, of all Confidential Information, Inventions, Materials or Proprietary Rights, as well as any business opportunity which comes to my attention during the Term and which relates to the business of the Company or which arises as a result of my employment with the Company. I will not take advantage of or divert any such opportunity for the benefit of myself or anyone else either during or after the Term without the prior written consent of the Company. 3.5 Exhibit A is a list describing all inventions, original works of authorship, developments, improvements, and trade secrets which were made by me prior to the Term (collectively referred to as "Prior Inventions"), which belong to me, which relate to the Company's current or proposed business, products or research and development, and which are not assigned to the Company hereunder; or, if no such list is attached, I represent that there are no such Prior Inventions. If, during the Term, I incorporate into a Company product, process or machine a Prior Invention owned by me or in which I have an interest, the Company is granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide license to make, have Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -3- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT made, modify, use and sell such Prior Invention as part of or in connection with such product, process or machine. 3.6 Labor Code Section 2870 Notice. I have been notified and understand that the provisions of Sections 3.1 and 3.2 of this Agreement do not apply to any Invention assigned hereunder that qualifies fully under the provisions of Section 2870 of the California Labor Code, which states as follows: ANY PROVISION IN AN EMPLOYMENT AGREEMENT WHICH PROVIDES THAT AN EMPLOYEE SHALL ASSIGN, OR OFFER TO ASSIGN, ANY OF HIS OR HER RIGHTS IN AN INVENTION TO HIS OR HER EMPLOYER SHALL NOT APPLY TO AN INVENTION THAT THE EMPLOYEE DEVELOPED ENTIRELY ON HIS OR HER OWN TIME WITHOUT USING THE EMPLOYER'S EQUIPMENT, SUPPLIES, FACILITIES, OR TRADE SECRET INFORMATION EXCEPT FOR THOSE INVENTIONS THAT EITHER: (1) RELATE AT THE TIME OF CONCEPTION OR REDUCTION TO PRACTICE OF THE INVENTION TO THE EMPLOYER'S BUSINESS, OR ACTUAL OR DEMONSTRABLY ANTICIPATED RESEARCH OR DEVELOPMENT OF THE EMPLOYER; OR (2) RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE EMPLOYER. TO THE EXTENT A PROVISION IN AN EMPLOYMENT AGREEMENT PURPORTS TO REQUIRE AN EMPLOYEE TO ASSIGN AN INVENTION OTHERWISE EXCLUDED FROM BEING REQUIRED TO BE ASSIGNED UNDER CALIFORNIA LABOR CODE SECTION 2870(a), THE PROVISION IS AGAINST THE PUBLIC POLICY OF THIS STATE AND IS UNENFORCEABLE. 3.7 Inventions Assigned to the United States. I agree to assign to the United States government all my right, title and interest in and to any and all Inventions whenever such full title is required to be in the United States by a contract between the Company and the United States or any of its agencies. Section 4. Further Obligations 4.1 During the Term, I will not, directly or indirectly, engage in, be employed by, perform services for or otherwise participate in any Competing Business. 4.2 My execution, delivery and performance of this Agreement and the performance of my other obligations and duties to the Company will not cause any Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -4- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT breach, default or violation of any other employment, nondisclosure, confidentiality, consulting or other agreement to which I am a party or by which I may be bound. Attached as Exhibit B is a list of all prior agreements now in effect under which I have agreed to keep information confidential or not to compete or solicit employees of any Person. 4.3 I will not use in performance of my work for the Company or disclose to the Company any trade secret, confidential or proprietary information of any prior employer or other Person if and to the extent that such use or disclosure may cause a breach, default or violation of any obligation or duty that I owe to such other Person (e.g., under any agreement or applicable law). My compliance with this Section 4.3 will not prohibit, restrict or impair the performance of my work, obligations and duties to the Company. Section 5. Nonsolicitation 5.1 Employees/Consultants. During the Term and for one year after the end of the Term (the "Additional Period"), I will not induce, or attempt to induce, any employee or consultant of the Company to cease such employment or relationship to engage in, be employed by, perform services for, participate in the ownership, management, control or operation of, or otherwise be connected with, either directly or indirectly, any Competing Business. 5.2 Suppliers/Contractors. During the Term and for the Additional Period, I agree (except on behalf of or with the prior written consent of the Company) that I will not, directly or indirectly (a) solicit, divert, appropriate to or accept on behalf of any Competing Business, or (b) attempt to solicit, divert, appropriate to or accept on behalf of any Competing Business, any business from any customer or actively sought prospective customer of the Company with whom I have dealt, whose dealings with the Company have been supervised by me or about whom I have acquired Confidential Information in the course of my employment. Section 6. Termination of Relationship 6.1 I agree that at the end of the Term I will deliver to the Company (and will not keep in my possession, re-create or deliver to anyone else) any and all Materials and other property belonging to the Company, its successors, assigns, customers and/or development partners. I agree to sign and deliver the "Termination Certification" attached as Exhibit C. Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -5- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT 6.2 At the end of the Term, I agree to provide the name of my new employer, if any, and consent to notification by the Company to my new employer about my rights and obligations under this Agreement in the form of Exhibit D. Section 7. Employment At Will I understand that this Agreement does not obligate the Company to employ me for any stated period of time. I understand that my employment is "at will" which means that it can be terminated at any time by the Company or by me, with or without cause and with or without notice. I agree that any promise or obligation that my employment be on any other basis than "at will" is invalid unless in writing signed by the president of the Company. I agree to abide by the Company's rules, regulations, policies and practices as revised from time to time. [NOTE: The above provision will be deleted in its entirety or substantially modified in the form of Inventions and Confidential Information Agreement for individuals with employment agreements.] Section 8. Miscellaneous 7.1 Survival. This Agreement will survive the end of the Term. 7.2 Successors and Assigns; Assignment. Except as otherwise provided in this Agreement, this Agreement and the rights and obligations of the parties hereunder will be binding upon and inure to the benefit of their respective successors, assigns, heirs, executors, administrators and legal representatives. The Company may assign any of its rights and obligations under this agreement. I understand that I may not assign, whether voluntarily or by operation of law, any of my rights and obligations under this Agreement, except with the prior written consent of the Company. 7.3 Injunctive Relief; Costs. I acknowledge that my obligations under this Agreement are important to the Company, and that the Company would not employ or continue to employ me without my agreement to such obligations. I also acknowledge that if I do not abide by my obligations in this Agreement, the Company will suffer immediate and irreparable harm, and that the damage to the Company will be difficult to measure and financial relief will be incomplete. Accordingly, the Company will be entitled to injunctive relief and other equitable remedies in the event of a breach by me of any obligation under this Agreement. The rights and remedies of the Company under this section are in addition to all other remedies. Further, in any legal action or other proceeding in connection with this Agreement (e.g., to recover damages or other relief), the prevailing party will be entitled to recover its reasonable attorneys' fees and other costs incurred. Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -6- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT 7.4 Severability. This Agreement will be enforced to the fullest extent permitted by applicable law. If for any reason any provision of this Agreement is held to be invalid or unenforceable to any extent, then (a) such provision will be interpreted, construed or reformed to the extent reasonably required to render the same valid, enforceable and consistent with the original intent underlying such provision and (b) such invalidity or unenforceability will not affect any other provision of this Agreement or any other agreement between the Company and me. 7.5 Governing Law; Jurisdiction; Venue. This Agreement will be governed by the laws of the state of California without regard to principles of conflicts of law. I irrevocably consent to the jurisdiction and venue of the state and federal courts located in Orange County, California in connection with any action relating to this Agreement. I will not bring any action relating to this Agreement in any other court. 7.6 Amendments. Neither this Agreement nor any provision may be amended except by written agreement signed by the parties. 7.7 Waivers. No waiver of any breach shall be considered valid unless in writing, and no waiver shall be a waiver of any subsequent breach. 7.8 Acknowledgment. I have carefully read all of the provisions of this Agreement and agree that (a) the same are necessary for the reasonable and proper protection of the Company's business, (b) the Company has been induced to enter into and/or continue its relationship with me in reliance upon my compliance with the provisions of this Agreement, (c) every provision of this Agreement is reasonable with respect to its scope and duration, (d) I have executed this Agreement without duress or coercion from any source, and (e) I have received a copy of this Agreement. This Agreement shall be effective as of [ enter date employment ---------------------------- agreement is effective] . - --------------------------------- ___________________________ Signature ___________________________ FULL NAME (print or type) Soc. Sec. No.______________ ACCEPTED: - -------- Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -7- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT QUANTUM TECHNOLOGIES WORLDWIDE, INC. By: _____________________________ Name: Syed F. Hussain Title: President and CEO Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement -8- EXHIBIT "D" TO STOCK TRANSFER AGREEMENT EXHIBIT A LIST OF PRIOR INVENTIONS AND ORIGINAL WORKS OF AUTHORSHIP
Identifying Number Title Date or Brief Description - ----------------------------- ------------------- ---------------------------------
_____ No inventions or improvements _____ Additional Sheets Attached Signature of Employee: ____________________________________ Print Name of Employee: ___________________________________ Date: ___________________ Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement EXHIBIT "D" TO STOCK TRANSFER AGREEMENT EXHIBIT B The following is a list of all prior agreements with former employers or others to which I am a party in which I agreed to maintain the confidentiality of the information of, or not to compete with or solicit the employees or customers of a third party. _____ No Agreements _____ See below _____ Additional sheets attached Signature of Employee: ____________________________________ Print Name of Employee: ___________________________________ Date: ___________________ Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement EXHIBIT "D" TO STOCK TRANSFER AGREEMENT EXHIBIT C TERMINATION CERTIFICATION This is to certify that I do not have in my possession, and I have not failed to return, any Materials or other property belonging to Quantum Technologies Worldwide, Inc., its subsidiaries, affiliates, successors or assigns (together, the "Company"). I further certify that I have complied with all the terms of the Company's Inventions and Confidential Information Agreement signed by me, including the reporting of any Inventions conceived or made by me (solely or jointly with others) covered by that Agreement, a copy of which is attached. I further agree that, in compliance with the Agreement, I will not use, disclose, publish or distribute any Confidential Information, Inventions, Materials or Proprietary Rights. During the Term and for one year after the end of the Term (the "Additional Period"), I will not induce, or attempt to induce, any employee or independent contractor of the Company to cease such employment or relationship to engage in, be employed by, perform services for, participate in the ownership, management, control or operation of, or otherwise be connected with, either directly or indirectly, any Competing Business. During the Term and for the Additional Period, I agree (except on behalf of or with the prior written consent of the Company) that I will not, directly or indirectly (a) solicit, divert, appropriate to or accept on behalf of any Competing Business, or (b) attempt to solicit, divert, appropriate to or accept on behalf of any Competing Business, any business from any customer or actively sought prospective customer of the Company with whom I have dealt, whose dealings with the Company have been supervised by me or about whom I have acquired Confidential Information in the course of my employment. Signature of Employee: ____________________________________ Print Name of Employee: ___________________________________ Date: ___________________ Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement EXHIBIT "D" TO STOCK TRANSFER AGREEMENT EXHIBIT D NOTIFICATION TO NEW EMPLOYERS [Letterhead of Quantum Technologies Worldwide, Inc.] Dear [name of new employer's president]: We understand that our former employee, [name of employee], has accepted employment with your company. This letter is to advise you that [name of employee] signed an Inventions and Confidential Information Agreement with our Company that remains in full force and effect. At the time [name of employee] left our company, we advised [him/her] of [his/her] continuing obligations under the Agreement and [name of employee] signed a Termination Certificate affirming [his/her] obligations under the Agreement. A copy of the Termination Certificate, dated __________, 200_, is enclosed so that any conflict with these obligations can be avoided during [his/her] employment with you. Very truly yours, [Signature of Company president or corporate counsel] _______________________________ [Typed name] Inventions and Confidential Information QUANTUM TECHNOLOGIES WORLDWIDE, INC. Agreement EX-10.34 5 dex1034.txt REGISTRATION RIGHTS AGREEMENT EXHIBIT 10.34 REGISTRATION RIGHTS AGREEMENT by and between Quantum Technologies Worldwide, Inc. and General Motors Corporation Dated as of June 12, 2001 Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. CONTENTS 1. Definitions........................................................... 1 2. Request for Registration.............................................. 2 3. Company Registration.................................................. 3 4. Form S-3 Registration................................................. 4 5. Obligations of the Company............................................ 4 6. Furnish Information................................................... 6 7. Expenses of Registration.............................................. 6 8. Underwriting Requirements............................................. 7 9. Delay of Registration................................................. 8 10. Indemnification....................................................... 8 11. Reports Under the Act................................................. 11 12. Assignment of Registration Rights..................................... 11 13. Limitations on Subsequent Registration Rights......................... 12 14. Termination of Registration Rights.................................... 12 15. Miscellaneous......................................................... 12 15.1 Notices......................................................... 12 15.2 Amendments and Waivers.......................................... 13 15.3 Governing Law; Jurisdiction; Venue.............................. 13 15.4 Successors and Assigns.......................................... 13 15.5 Severability.................................................... 13 15.6 Entire Agreement; Counterparts.................................. 13
Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. QUANTUM TECHNOLOGIES WORLDWIDE, INC. Registration Rights Agreement THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered into as of June 12, 2001, by and among QUANTUM TECHNOLOGIES WORLDWIDE, INC., a Delaware corporation (the "Company"), and GENERAL MOTORS CORPORATION, a Delaware corporation (the "Investor "). RECITALS A. The Company is proposing to issue and transfer newly authorized shares of its Series A Common Stock, $0.001 par value per share (such Series A Common Stock and such shares of Common Stock into which it is convertible, the "Common Stock") to the Investor. B. The execution of this Agreement by the parties is a condition to the obligation of the Investor to acquire the Common Stock. C. The Company and the Investor desire to enter into this Agreement to facilitate the transfer and acquisition of the Common Stock. D. This Agreement shall become effective as of the STA Closing ("Effective Date"), as defined in the Stock Transfer Agreement. AGREEMENT 1. Definitions For purposes of this Agreement, the following terms have the following meanings: (a) "Form S-3" means such form under the Securities Act of 1933, as amended (the "Act"), as in effect on the date hereof or any registration form under the Act subsequently adopted by the Securities and Exchange Commission (the "SEC") that similarly permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC; Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -1- (b) "Holder" means the Investor, and any person who shall hereafter acquire at least 15% of the Common Stock held by the Investor as of the Effective Date of this Agreement, so long as such Investor or other party holds Registrable Securities; (c) "register," "registered" and "registration" refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Act and the declaration or order of effectiveness of such registration statement or document; (d) "Registrable Securities" means (i) any Common Stock of the Company held as of the date hereof by the Investor or hereafter acquired by the Investor and (ii) any Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, such Common Stock, excluding in all cases, however, any Registrable Securities sold by a person in a transaction in which its rights under this Agreement are not assigned and any Common Stock which the holder thereof is entitled to sell into the public market; (e) "Registrable Securities then outstanding" means the number of shares of Common Stock outstanding which are, and the number of shares of Common Stock issuable pursuant to then exercisable or convertible securities which are, Registrable Securities; and (f) "SEC" means the Securities and Exchange Commission. 2. Request for Registration (a) If the Company shall receive, at any time after the earlier of (i) three (3) years after the Effective Date or (ii) six (6) months after the effective date of the first registration statement for a public offering of securities of the Company to the general public, a written request from the Holders of a majority of the Registrable Securities then outstanding (the "Initiating Holders") that the Company file a registration statement (other than on Form S-3) under the Act covering the registration of Registrable Securities having an aggregate proposed offering price to the public of at least $20,000,000, then the Company shall, within twenty (20) business days after the receipt of such request, give written notice of such request to all Holders and shall, subject to the limitations set forth below, use commercially reasonable efforts to effect as soon as practicable the registration under the Act of all Registrable Securities that the Holders request to be registered in a written request to be given within thirty (30) business days of the mailing of such notice by the Company. Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -2- (b) The Company is obligated to effect only two (2) registrations pursuant to this Section 2. (c) Notwithstanding the foregoing, if the Company shall furnish to the Initiating Holders requesting a registration pursuant to this Section 2 within thirty (30) business days of receiving such request: (i) a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company it would be seriously detrimental to the Company and its shareholders for such registration statement to be filed and it is therefore essential to defer the filing of such registration statement, the Company shall have the right to defer such filing for a period of not more than ninety (90) calendar days after receipt of the request of the Initiating Holders; provided, however, that the Company may not use this right more than once in any twelve (12)-month period, or (ii) a certificate signed by the President of the Company stating that the Company intends within ninety (90) calendar days of the date of such certificate to file a registration statement for the initial public offering of securities of the Company to the general public, in which case the Company shall not be obligated to effect the registration requested pursuant to this Section 2 for a period of one hundred eighty (180) calendar days following the effective date of such initial public offering; provided, however, that the Company shall promptly notify the -------- ------- Initiating Holders requesting a registration pursuant to this Section 2 of any decision by the Company to abandon or indefinitely delay such initial public offering. 3. Company Registration If the Company proposes to register (including for this purpose a registration effected by the Company for shareholders other than the Holders) any of its stock or other securities under the Act in connection with the public offering of such securities solely for cash (other than a registration relating solely to the sale of securities to participants in a Company stock plan, or a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities), the Company shall, at each such time, promptly give each Holder of Registrable Securities written notice of such registration. Upon the written request of each such Holder given within twenty (20) business days after the mailing of such notice by the Company, the Company shall, subject to the provisions of Section 8, use commercially reasonable efforts to cause to be registered under the Act all of the Registrable Securities that each such Holder has requested to be registered. In the event that the Company decides for any reason not to complete the registration of shares of Common Stock other than Registrable Securities, the Company shall have no obligation under this Section 3 to continue with the registration of Registrable Securities. Any request pursuant to this Section 3 to register Registrable Securities as part of an underwritten Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -3- public offering of Common Stock shall specify that such Registrable Securities are to be included in the underwriting on the same terms and conditions as the shares of Common Stock otherwise being sold through underwriters under such registration. 4. Form S-3 Registration (a) If the Company shall receive a written request from the Holders of fifty percent (50%) of the Registrable Securities then outstanding that the Company effect a registration on Form S-3, then the Company shall, within ten (10) business days after the receipt of such request, give written notice of such request to all Holders and shall, subject to the limitations set forth below, use commercially reasonable efforts to effect as soon as practicable the registration under the Act of all Registrable Securities that the Holders request to be registered in a written request to be given within thirty (30) business days of the mailing of such notice by the Company. (b) Notwithstanding the foregoing, the Company shall not be obligated to effect any such registration pursuant to this Section 4 if: (i) Form S-3 is not available for such offering by the Holders; (ii) the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public (before deduction of any underwriters' discounts or commissions) of less than $10,000,000; (iii) the Company shall furnish to the Holders a certificate signed by the President of the Company stating that, in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the Company and its shareholders for such Form S-3 registration to be filed at such time, in which event the Company shall have the right to defer the filing of the Form S-3 registration statement for a period of not more than ninety (90) calendar days after receipt of the request of the Holders under this Section 4; provided, -------- however, that the Company shall not use this right more than once in any twelve - ------- (12)-month period; (iv) the Company has, within the twelve (12)-month period preceding the date of such request, already effected two (2) such registrations on Form S-3 for the Holders pursuant to this Section 4; or (v) the Company within the twelve (12)-month period preceding the date of such request has effected a registration of securities in which the Holders of Registrable Securities requesting registration pursuant to this Section 4 were entitled and given timely notice to participate to the fullest extent they desired upon receipt of notice pursuant to Section 2 or 3. 5. Obligations of the Company Whenever required under this Agreement to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible: Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -4- (a) Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its commercially reasonable efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to one hundred twenty (120) calendar days. (b) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Act with respect to the disposition of all securities covered by such registration statement. (c) Furnish to the Holders such copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Act, and such other documents as they may reasonably request to facilitate the disposition of all securities covered by such registration statement. (d) Use commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other securities or blue sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required to qualify to do business or to file a general consent to service of process in any such states or jurisdictions. (e) In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering. Each Holder participating in such registration shall also enter into and perform its obligations under such an agreement. (f) Notify each Holder of Registrable Securities covered by such registration statement, during the time when a prospectus is required to be delivered under the Act, of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing. (g) At the request of any Holder selling Registrable Securities in such registration, furnish on the date that such Registrable Securities are delivered to the underwriters for sale in connection such registration (i) an opinion, dated such date, of legal counsel representing the Company for the purposes of such registration, in form and substance as is customarily given by Company counsel to underwriters in an underwritten public offering, addressed to the underwriters and (ii) a letter, dated Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -5- such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters. (h) List the Registrable Securities being registered on any national securities exchange on which a class of the Company's equity securities is listed or qualify the Registrable Securities being registered for inclusion on Nasdaq if the Company does not have a class of equity securities listed on a national securities exchange. (i) Provide a transfer agent and registrar for the securities being registered and a CUSIP number, not later than the effective date of the registration statement. 6. Furnish Information It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Agreement that the selling Holders shall furnish to the Company such information regarding themselves, the Registrable Securities held by them and the intended method of disposition of such securities as shall be reasonably required to effect the registration of their Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request. 7. Expenses of Registration In connection with any registration pursuant to Sections 2 and 3 of this Agreement, the Company shall be responsible for the payment of all reasonable expenses of the registration, with the exception of (a) underwriting discounts and commissions, which shall be paid by the Holders and any other selling holders of the Company's securities in proportion to the aggregate value of the securities offered for sale by each of them, and (b) the fees and expenses of more than one law firm acting as counsel to the selling Holders selected by a majority in interest of the selling Holders, which additional counsel, if any, shall be paid by the Holder or Holders that engage such counsel. The expenses to be paid by the Company shall include, without limitation, all registration, filing and qualification fees, printing and accounting fees, the fees and disbursements of counsel for the Company and the fees and disbursements of one counsel for the selling Holders; provided, however, that the Company shall not -------- ------- be required to pay for any expenses of any registration proceeding begun pursuant to Section 2 if the registration request is subsequently withdrawn (other than a withdrawal due to a material adverse change in the Company's business or financial condition), unless, in the event of a registration initiated pursuant to the Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -6- provisions of Section 2, the Holders of a majority of the Registrable Securities agree to forfeit the right to one demand registration. All expenses incurred in connection with a registration requested pursuant to Section 4, including, without limitation, all registration, filing, qualification, printer's and accounting fees and the reasonable fees and disbursements of counsel for the selling Holder or Holders and counsel for the Company shall be borne pro rata by the Holder or Holders participating in the Form S-3 registration. 8. Underwriting Requirements (a) The Holders under Section 2 must distribute the Registrable Securities covered by their request by means of a public offering underwritten by a reputable national or regional underwriter. The right of any Holder to include its Registrable Securities in such registration under Section 2 shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities through such underwriting shall (together with the Company as provided in Section 5(e)) enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by a majority in interest of the Holders. Notwithstanding any other provisions of Section 2, if the underwriter advises the Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the Holders shall so advise all Holders of Registrable Securities which would otherwise have been underwritten pursuant to Section 2, and the number of shares of Registrable Securities that may be included in the registration shall be apportioned first pro rata among the selling Holders, including the Initiating Holders, according to the total amount of Registrable Securities requested to be sold in such registration by such Holders, then to the Company and then pro rata among any other selling shareholders according to the total amount of securities otherwise entitled to be included therein owned by each such selling shareholder, or in such other proportions as shall mutually be agreed to by such selling shareholders. (b) The Company shall not be required under Section 3 to include any of the Holders' securities in an underwritten offering of the Company's securities unless such Holders accept the terms of the underwriting as agreed upon between the Company and the underwriters selected by it. If the underwriters advise the Company that marketing factors require a limitation on the number of shares, including Registrable Securities, to be included in such offering, then the Company shall so advise all Holders of Registrable Securities that would otherwise have been underwritten pursuant to Section 3, and the number of shares, including Registrable Securities, that may be included in the registration shall be apportioned first to the Company, then pro Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -7- rata among the selling Holders according to the total amount of Registrable Securities requested to be sold in such registration by such Holders, then pro rata among any other selling shareholders according to the total amount of securities otherwise entitled to be included therein owned by each such other selling shareholder, or in such other proportions as shall mutually be agreed to by such selling shareholders; provided, that in no event shall the amount of -------- securities of the selling Holders included in the registration be reduced below twenty percent (20%) of the total amount of securities included in such registration, unless such registration is the initial public offering of the Company's securities, in which case the selling Holders may be excluded if the underwriters make the determination described above and provided no other shareholder's securities are included. 9. Delay of Registration No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any registration of the Company as the result of any controversy that might arise with respect to the interpretation or implementation of this Agreement. 10. Indemnification In the event any Registrable Securities are included in a registration statement under this Agreement: (a) To the extent permitted by law, the Company will indemnify and hold harmless each Holder, any underwriter (as defined in the Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Act or the Securities Exchange Act of 1934, as amended (the "1934 Act"), against any actual expenses (including legal fees and costs), losses, claims, damages (including settlement amounts) or liabilities (joint or several) (collectively, "Losses") to which they may become subject under the Act, the 1934 Act or other federal or state law, insofar as such Losses arise out of or are based upon any of the following statements, omissions or violations (collectively, a "Violation"): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein, or any amendments or supplements thereto, untrue in light of the circumstances under which they were made, (ii) the omission or alleged omission to state therein a 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, or (iii) any violation or alleged violation by the Company of the Act, the 1934 Act, any state securities law or any rule or regulation promulgated under the Act, the 1934 Act or Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -8- any state securities law. The Company will reimburse (as incurred) each such Holder, underwriter or controlling person for any Losses reasonably incurred by them in connection with investigating or defending any Violations; provided, however, that the indemnity agreement contained in this Section 10(a) shall not apply to amounts paid in settlement of any claims for Violations if such settlement is made without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable in any such case for any Losses that arise out of or are based upon a Violation that occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by, or on behalf of, any such Holder, underwriter or controlling person. (b) To the extent permitted by law, each selling Holder will indemnify and hold harmless the Company and its officers, directors, agents and employees, each underwriter and each other Holder selling securities in such registration statement, and any person who controls any of the foregoing within the meaning of the Act or the 1934 Act, against any Losses to which the Company or such officer, director, agent, employee, or underwriter or other selling Holder or controlling person may become subject under the Act, the 1934 Act or other federal or state law, insofar as such Losses arise out of or are based upon any Violation that occurs in reliance upon and in conformity with written information furnished by, or on behalf of, such Holder expressly for use in connection with such registration; and each such Holder will reimburse (as incurred) any Losses reasonably incurred by the Company or its officers, directors, agents, employees, or underwriters or other selling Holders or controlling persons in connection with investigating or defending any Violations; provided, however, that (i) the indemnity agreement contained in this Section 10(b) shall not apply to amounts paid in settlement of any claims for Violations if such settlement is made without the consent of the Holder, which consent shall not be unreasonably withheld and (ii) the obligations of such Holders shall be limited to an amount equal to the gross proceeds to each such Holder of Registrable Securities sold as contemplated herein, except in the instance of fraud. (c) Promptly after receipt of notice of the commencement of any action (including any governmental action), an indemnified party will, if a claim is to be made against any indemnifying party under this Section 10, deliver to the indemnifying party a written notice of the commencement, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly notified, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall -------- ------- have the right to retain its own counsel, with the fees and expenses to be paid by the indemnifying party, if, in the opinion of counsel for the indemnifying party, representation of such indemnified party by the counsel retained Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -9- by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in the proceeding. The failure to deliver written notice to the indemnifying party within a reasonable period of time after notice of the commencement of any such action shall relieve such indemnifying party of any liability to the indemnified party under this Section 10 to the extent such failure is prejudicial to its ability to defend such action, but the omission to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 10. (d) If the indemnification provided for in this Section 10 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any Losses, then the indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such Losses in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the Violations that resulted in such Losses as well as any other relevant equitable considerations; provided that, in no event shall any contribution by a Holder -------- under this Section 10(d) exceed the gross proceeds to each such Holder, except in the case of fraud by such Holder. The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the Violation resulting in such Losses relates to information supplied by the indemnifying party or by the indemnified party and the parties' relative intent, knowledge, access to information, and opportunity to correct or prevent such Violation. (e) Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control. (f) The obligations of the Company and Holders under this Section 10 shall survive the completion of any offering of Registrable Securities and the termination of Registration Rights pursuant to Section 14. 11. Reports Under the Act With a view to making available to the Holders the benefits of SEC Rule 144 promulgated under the Act and any other rule or regulation of the SEC that may at any time permit a Holder to sell securities of the Company to the public without Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -10- registration or pursuant to a registration on Form S-3, the Company agrees to use commercially reasonable efforts to: (a) Make and keep public information available, as those terms are understood and defined in SEC Rule 144, at all times after ninety (90) calendar days from the effective date of the first registration statement filed by the Company for the offering of its securities to the general public; (b) Take such action, including the voluntary registration of its Common Stock under Section 12 of the 1934 Act, as is necessary to enable the Holders to utilize Form S-3 for the sale of their Registrable Securities, such action to be taken as soon as practicable after the end of the fiscal year in which the first registration statement filed by the Company for the offering of its securities to the general public is declared effective; (c) File with the SEC in a timely manner all reports and other documents required of the Company under the Act and the 1934 Act; and (d) Furnish to any Holder, so long as the Holder owns any Registrable Securities, promptly upon request (i) a written statement by the Company that it has complied with the reporting requirements of the 1934 Act (at any time after ninety (90) calendar days from the date on which it becomes subject to such reporting requirements), or that it qualifies as a registrant whose securities may be resold pursuant to Form S-3 (at any time after it so qualifies), (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be reasonably requested in availing any Holder of any rule or regulation of the SEC that permits the selling of any such securities without registration or pursuant to such Form S-3. 12. Assignment of Registration Rights The rights to cause the Company to register Registrable Securities pursuant to this Agreement may be assigned by a Holder to a transferee or assignee of such securities who shall, upon such transfer or assignment, be deemed a "Holder" under this Agreement; provided, that the Company is, within a -------- reasonable period of time after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned; provided, further, -------- ------- that such assignment shall be effective only if immediately following such transfer the further disposition of such securities by the transferee or assignee is restricted under the Act and that such transferee or assignee is a transferee or assignee that after the transfer or assignment holds at least 15% of the amount of Registrable Securities held by the Investor as of the date hereof. Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -11- 13. Limitations on Subsequent Registration Rights From and after the date of this Agreement, the Company shall not, without the prior written consent of the Holders of a majority of the Registrable Securities then outstanding, enter into any agreement with any holder or prospective holder of any securities of the Company that would allow such holder or prospective holder to: (a) include such securities in any registration filed under Section 2, 3 or 4, unless under the terms of such agreement such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of its securities will not reduce the amount of the Registrable Securities of the Holders which is included; or (b) make a demand registration which could result in such registration statement being declared effective prior to the earlier of either of the dates set forth in Section 2(a) or within one hundred eighty (180) calendar days of the effective date of any registration effected pursuant to Section 2. 14. Termination of Registration Rights The registration rights granted under Sections 2, 3 and 4 of this Agreement shall terminate as to all Holders on the earlier of (i) the tenth anniversary of the closing of the initial public offering of the Company's securities and (ii) the termination of the Corporate Alliance Agreement. 15. Miscellaneous 15.1 Notices Any notice required by the terms of this Agreement shall be given in writing and shall be (a) mailed by registered or certified mail, postage prepaid, return receipt requested, (b) delivered by a nationally recognized overnight courier, (c) sent by conformed facsimile or (d) otherwise delivered by hand or by messenger. Notice shall be addressed to the Company at its principal executive office and to the Investor or Holder at the address listed on the signature page hereof or at such other address as such party may designate by ten (10) days' advance written notice to the other party given in the foregoing manner. If notice is provided by mail, notice shall be deemed to be given upon receipt as evidenced by postal records; if by overnight courier, notice shall be deemed to be given twenty-four (24) hours after deposit; if by facsimile, upon completion of such facsimile transmission as conclusively evidenced by the transmission receipt; and if by hand or messenger, upon receipt. Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -12- 15.2 Amendments and Waivers Any term of this Agreement may be amended and the observance of any term 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 Holders of a majority the Registrable Securities then outstanding. Additional Holders may be added to this Agreement with such consent by amending Schedule A and adding a signature page executed by such additional Holder. 15.3 Governing Law; Jurisdiction; Venue This Agreement shall be governed by and construed under the laws of the state of Delaware without regard to principles of conflict of laws. The parties irrevocably consent to the jurisdiction and venue of the state and federal courts located in Orange County, California, in connection with any action relating to this Agreement. 15.4 Successors and Assigns The terms and conditions of this Agreement shall inure to the benefit of and be binding on the respective successors and assigns of the parties as provided herein. 15.5 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 this Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms. 15.6 Entire Agreement; Counterparts This Agreement constitutes the entire agreement between the parties about its subject and supersedes all prior agreements. This Agreement may be executed in two or more counterparts, which together shall constitute one instrument. Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -13- IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. THE COMPANY QUANTUM TECHNOLOGIES WORLDWIDE, INC. By: /s/ Syed F. Hussain ______________________________ Name: Syed F. Hussain Title: President and CEO Address: 17872 Cartwright Road Irvine, CA 92614 Telephone: (949) 399-4511 Facsimile: (949) 474-3086 INVESTOR GENERAL MOTORS CORPORATION By: /s/ Lawrence D. Burns ______________________________ Name: Lawrence D. Burns Title: Vice President, GM Research & Development and Planning Address: 30500 Mound Road M/C: 480-106-EX2 Warren, MI 48090-9055 Telephone: (810) 986-2500 Facsimile: (810) 986-6347 Registration Rights Agreement QUANTUM TECHNOLOGIES, INC. -14- Schedule A -Additional Holders under Registration Rights Agreement Number Holder Name of Shares ---------------------------------------------- ------------------- -----END PRIVACY-ENHANCED MESSAGE-----