Exhibit 10.9
SHARE OPTION PURCHASE AGREEMENT
THIS SHARE OPTION PURCHASE AGREEMENT (this "AGREEMENT") is made
as of September 30, 1998, among Geneve Securities Holding Corp., Geneve
Securities Portfolio Corp., Chaparral International Re., Southern Mortgage
Holding Corporation and Southern Investors Corp. (collectively, "GHI"),
Xxxxxxxxx Sign Company, a Texas corporation (the "COMPANY"), and Xxxxx
Xxxxxxxx ("XXXXXXXX," and together with the Company, the "OPTIONEES").
Except as otherwise indicated herein, capitalized terms used and not
otherwise defined herein have the meanings ascribed to such terms in the
Senior Subordinated Note, Preferred Stock and Warrant Purchase Agreement,
dated as of the date hereof (the "PURCHASE AGREEMENT"), among the Company and
certain investors listed therein.
GHI desires to grant to each Optionee and each Optionee desires
to acquire an option (each an "OPTION" and collectively the "Options") to
purchase the number of shares of the Company's Common Stock indicated on
Schedule I hereto which aggregate 785,143 shares (the "OPTION SHARES") at the
exercise prices and on the terms and subject to the conditions set forth
herein.
As of the date hereof, the Company has entered into a Senior
Subordinated Note, Preferred Stock and Warrant Purchase Agreement (the
"RECAPITALIZATION AGREEMENT") pursuant to which the Company is initiating a
plan to recapitalize its existing debt and equity structure through a series
of transactions which include the issuance to certain investors of capital
stock and subordinate notes thereunder. Execution and delivery of this Share
Option Purchase Agreement is a condition to the obligations of such Investors
thereunder.
In consideration of the mutual covenants and promises contained
herein and for the good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows:
Section 1. OPTION.
1A. COMPANY OPTION. GHI hereby grants to the Company an
Option for the purchase of up to 357,143 Option Shares at a price per share
equal to $1.50 per share in cash and the delivery of .0175 shares of Series C
Preferred Stock, par value $0.01 per share (the "SERIES C PREFERRED STOCK"),
payable upon exercise as set forth in SECTION 2. The Option granted pursuant
to this SECTION 1A may be exercised only during the period (the "EXERCISE
PERIOD") commencing with the open of business on January 4, 1999 through the
close of business on January 8, 1999.
1B. XXXXXXXX OPTION. GHI hereby grants to Xxxxxxxx an
Option (the "XXXXXXXX OPTION") for the purchase of up to 428,000 Option
Shares at a price per share equal to $3.25 per share, payable in cash only
upon exercise as set forth in SECTION 2. The Xxxxxxxx Option may be
exercised only during the Exercise Period.
1C. CONSIDERATION. The consideration for an Option being
granted hereunder is $.25 per Option Share. As of the date hereof, the
Company and Xxxxxxxx shall deliver $89,285.75 and $107,000.00, respectively,
to GHI, by cashier's check or wire transfer of immediately available funds.
Section 2. EXERCISE OF THE OPTION. Each Optionee may
exercise its Option, in whole or in part, upon payment of the product of (i)
the exercise price set forth in SECTION 1A or 1B, as the case may be,
multiplied by (ii) the number of Option Shares to be acquired. Payment of
the applicable option price by Xxxxxxxx shall be made in cash, by wire
transfer of immediately available funds to an account designated by GHI.
Payment of the applicable option price by the Company shall be made by
delivery of the applicable option price in cash, by wire transfer of
immediately and available funds, and by delivery of stock certificates
representing Series C Preferred Stock. Upon payment of the option price by
an Optionee, GHI shall deliver to such Optionee the stock certificates
evidencing the Option Shares to be acquired by such Optionee duly endorsed in
blank or accompanied by duly executed stock powers.
Section 3. REPRESENTATIONS AND WARRANTIES.
(a) GHI hereby represents and warrants to the
Optionees as follows:
(i) GHI is the record and beneficial owner of
the Option Shares free and clear of all Liens
and no other third party has any right or
interest in the Option Shares, and at the
time of the exercise of the Option by either
Optionee, such Optionee will acquire good and
marketable title to the Option Shares so
acquired free and clear of any Liens;
(ii) the Option Shares are not subject to any
statutory or contractual stockholders'
preemptive rights or rights of first offer or
refusal with respect to the transfers of the
Option Shares contemplated hereby;
(iii) Geneve Securities Portfolio Corp. is a
corporation duly organized, validly existing
and in good standing under the laws of the
State of Delaware and has the requisite
corporate power and authority to enter into
this Agreement and consummate the
transactions contemplated hereby;
(iv) Chaparral International Re. is a corporation
duly organized, validly existing and in good
standing under the laws of the jurisdiction
of its organization and has the requisite
corporate power and authority to enter into
this Agreement and consummate the
transactions contemplated hereby;
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(v) Geneve Securities Holding Corp. is a
corporation duly organized, validly existing
and in good standing under the laws of the
State of Delaware and has the requisite
corporate power and authority to enter into
this Agreement and consummate the
transactions contemplated hereby;
(vi) Southern Investors Corp. is a corporation
duly organized, validly existing and in good
standing under the laws of the State of
Delaware and has the requisite corporate
power and authority to enter into this
Agreement and consummate the transactions
contemplated hereby; and
(vii) Southern Mortgage Holding Corp. is a
corporation duly organized, validly existing
and in good standing under the laws of the
State of Delaware and has the requisite
corporate power and authority to enter into
this Agreement and consummate the
transactions contemplated hereby.
(b) Each of the Company and Xxxxxxxx hereby represent
and warrant to GHI that such person has the requisite power and authority
to enter into this Agreement and consummate the transactions contemplated
thereby and that if the Options are exercised each is acquiring the
Option Shares for investment purposes and not with any present intention
to resell or distribute such shares except for the contemplated sale by
Xxxxxxxx of a portion of the Option Shares to the Company.
Section 4. CERTAIN COVENANTS. Until exercise of the Options
contemplated hereby, GHI shall not and shall not permit any of its
representatives to take any action (whether as a shareholder, director,
officer, employee or otherwise) which would reasonably be anticipated to have
an adverse effect on the Company or the transactions contemplated hereby or
in the Recapitalization Agreement or the other agreements contemplated
hereby. Without limiting the foregoing in any way, prior to exercise of the
Options hereunder, GHI shall not, directly or indirectly, enter into any
contract, agreement or understanding with respect to the transfer or voting
of the Option Shares or the placing of a Lien on any of the Option Shares.
Section 5. MISCELLANEOUS.
5A. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein or made in writing by any
party in connection herewith shall survive the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby. The
covenants contained herein shall terminate upon the earlier of consummation
of the transactions contemplated hereby or the expiration of the Exercise
Period.
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5B. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.
5C. OTHER AGREEMENTS. Upon exercise of the Xxxxxxxx Option,
the Option Shares not subsequently conveyed to the Company shall be deemed
Stockholder Shares (as defined in the Stockholders Agreement) and Other
Registrable Securities (as defined in the Registration Agreement).
5D. COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, any one of which need not contain
the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same Agreement.
5E. GOVERNING LAW. THE CORPORATE LAW OF THE STATE OF TEXAS
SHALL GOVERN ALL ISSUES AND QUESTIONS CONCERNING THE RELATIVE RIGHTS AND
OBLIGATIONS OF THE COMPANY AND ITS STOCKHOLDERS. ALL OTHER ISSUES AND
QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND
INTERPRETATION OF THIS AGREEMENT AND THE EXHIBITS AND SCHEDULES HERETO SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
TEXAS, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW RULES OR
PROVISIONS (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT
WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE
STATE OF TEXAS.
5F. NOTICES. All notices, demands and other communications
given or delivered under this Agreement shall be in writing and shall be
deemed to have been given upon receipt when delivered personally or by
telecopy, one Business Day after being deposited with a reputable overnight
courier service or three Business Days after being deposited in the U.S.
Mail. Notices, demands and communications to the Purchasers and the Company,
unless another address is specified in writing, shall be sent to the address
or telecopy number indicated below and to the attention of such other persons
indicated below or to such other address or to the attention of such other
person as the recipient party has specified by prior written notice to the
sending party:
IF TO GHI:
Geneve Holdings, Inc.
00 Xxxxxxxx Xx. Xx.
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxx Xxxxx
Telecopier: (000) 000-0000
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IF TO THE COMPANY:
Xxxxxxxxx Sign Company
0000 Xxx 00 Xxxx
Xxxxx, Xxxxx 00000
Attn: Chief Executive Officer
Telecopier: (000) 000-0000
WITH COPIES TO:
Xxxxxxx Xxxxxx L.L.P.
000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxxxxxx
Telecopier: 214/953-5822
Bank of America National Trust and
Savings Association
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Telecopier: 312/828-6298
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx X. Xxxxxxxxxxx
Xxxxx X. Xxxxxxxxxx
Telecopier: 312/861-2200
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
5G. SPECIFIC PERFORMANCE. Each of the parties hereto
acknowledges and agrees that the other parties would be damaged irreparably
in the event any of the provisions of this Agreement are not performed in
accordance with their specific terms or are otherwise breached. Accordingly,
each of the parties hereto agrees that the other parties shall be entitled to
an injunction or injunctions (without the posting of bond or any other
security) to prevent breaches of the provisions of this Agreement and to
enforce specifically this Agreement and the terms and provisions hereof in
any action instituted in any court in the United States or in any state
having jurisdiction over the parties and the matter in addition to any other
remedy to which it may be
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entitled pursuant hereto.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date first written above.
SOUTHERN INVESTORS CORP.
By /s/ Xxxxx Xxxxx
----------------
Its
SOUTHERN MORTGAGE HOLDING CORPORATION
By /s/ Xxxxx Xxxxx
----------------
Its
GENEVE SECURITIES PORTFOLIO CORP.
By /s/ Xxxxx Xxxxx
----------------
Its
GENEVE SECURITIES HOLDING CORP.
By /s/ Xxxxx Xxxxx
----------------
Its
CHAPARRAL INTERNATIONAL RE.
By /s/ Xxxxx Xxxxx
----------------
Its
XXXXXXXXX SIGN COMPANY
By /s/ Xxxxxxx Xxxxxxx, VP
-----------------------
Its VP, CFO
/s/ Xxxxx Xxxxxxxx
------------------
Xxxxx Xxxxxxxx
SCHEDULE I
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SHARES TRANSFERRED
SHARES SUBJECT UPON EXERCISE
SELLER TO OPTIONS OPTION HOLDER OF OPTION
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Geneve Securities Portfolio 173,771 Company 173,771
Corp. Xxxxxxxx -0-
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Geneve Securities Holding Corp. 156,578 Company 156,578
Xxxxxxxx -0-
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Chaparral International Re. 17,500 Company 17,500
Xxxxxxxx -0-
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Southern Mortgage Holding 36,956 Company 9,151
Corp. Xxxxxxxx 27,805
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Southern Investors Corp. 400,338 Company 143
Xxxxxxxx 400,195
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