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EXHIBIT 10.17
AGREEMENT OF COMMITMENT TO EXERCISE RIGHTS
THIS AGREEMENT is entered into this as of the 21st day of December
1999 by and among XxxxxxXxxx.xxx, Inc., a Florida corporation (the "Company")
and O. R. Xxxxx ("Xxxxx"), X. X. Xxxxxx, Jr. ("Xxxxxx"), Xxxxxxx X. Xxxxxx
("Xxxxxx"), Xxxxxxx Xxxx North ("North"), Xxxxxx X. Xxxxxx ("Jordan") and
Xxxxxx X. Xxxxx ("Xxxxx") (each of Ramos, Gornto, Xxxxxx, North, Jordan and
Moses a "Purchaser" and collectively the "Purchasers").
RECITALS:
WHEREAS, the Company proposes to issue rights to purchase its common
stock, par value $.0001 per share (the "Common Stock"), pursuant to a
registration statement on Form S-1 filed with the Securities and Exchange
Commission in December 1999 (the "Rights Offering"); and
WHEREAS, the Company and the Purchasers are entering into this
Agreement to provide for a minimum subscription amount for the Rights Offering.
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto do hereby agree as follows:
1. Recitals. The foregoing Recitals are true and correct and are
incorporated herein by this reference.
2. Commitment to Exercise Rights and Subscribe for Shares.
(a) Each Purchaser represents that as of the date hereof he
holds H.T.E., Inc. shares and/or stock options which would entitle him to
rights (pursuant to the Rights Offering) to purchase Common Stock in the
following amounts and agrees on his own behalf that he shall exercise his
rights to subscribe for the total number of shares of Common Stock set forth
opposite his name below:
Purchaser Shares of Common Stock
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Xxxxx 407,424 shares
Xxxxxx 62,267 shares
Xxxxxx 344,000 shares
North 75,032 shares
Moses 12,500 shares
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(b) Each Purchaser further agrees on his own behalf that
effective on the closing date of the Rights Offering (the "Closing Date"), he
shall exercise rights to subscribe for the total number of additional shares of
Common Stock ("Additional Shares") set forth opposite such Purchaser's name
below, and in the order of priority below, in the event not all shares of
Common Stock are subscribed for in the Rights Offering:
(i) First, North shall acquire the lesser of: (X) 150,000
Additional Shares or (Y) the number of shares of unsubscribed Common Stock
available on the Closing Date.
(ii) Second, Jordan shall acquire the lesser of: (X) 100,000
Additional Shares or (Y) the number of shares of unsubscribed Common Stock
available on the Closing Date, less the Additional Shares acquired by North.
(iii) Third, Xxxxxx shall acquire the lesser of: (X) 50,000
Additional Shares or (Y) the number of shares of unsubscribed Common Stock
available on the Closing Date, less the Additional Shares acquired by North and
Jordan.
3. Mechanics of Payment for Shares.
(a) With respect to the shares acquired under Section 2(a),
above, the Purchasers shall exercise and pay for such shares in accordance with
the terms of the Rights Offering.
(b) With respect to the purchase of Additional Shares under
Section 2(b), above, on the Closing Date, the Company shall notify the
applicable Purchasers of the number of Additional Shares that they are
obligated to purchase under subsections 2(b)(i), (ii) and (iii). Within three
(3) business days of such notice (which shall be transmitted by facsimile and
shall be deemed received on the date sent), the Purchasers acquiring Additional
Shares shall deliver the full amount of the subscription price to the Company
by wire (pursuant to wiring instructions provided by the Company) or other good
funding mechanism approved by the Company.
4. Representations and Warranties. Each Purchaser hereby
severally represents, warrants and covenants to the Company that, in connection
herewith:
(a) Review and Evaluation of Information regarding the
Company. The Purchaser has had an opportunity to examine the governing
instruments and the material disclosure and other documents and records of the
Company. The Purchaser has had an opportunity to ask questions and receive
answers from the Company and from representatives of the Company concerning the
Company's financial condition and business and to obtain such other information
that he has deemed necessary to make a fully informed decision.
(b) Purchaser's Financial Experience. The Purchaser is
sufficiently experienced in financial and business matters to be capable of
evaluating the merits and risks of its/his investment in the Common Stock. The
Purchaser is familiar with the nature and risks attending investments.
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(c) Suitability of Investment. The Purchaser understands that
the shares of Common Stock are speculative investments and involve a high
degree of risk, including but not limited to: there is no guarantee of success
of the business of the Company; he may not receive any return (economic or
otherwise) on his investment, and management and the majority shareholders of
the Company have extreme latitude and generally, the sole discretion, to
determine the financial picture, operations and potential dissolution of the
Company. The Purchaser has evaluated the merits and risks of the Purchaser's
proposed investment in the Common Stock, including those risks particular to
the Purchaser's personal situation, and he has determined that this investment
is suitable for the Purchaser. The Purchaser has adequate financial resources
for an investment of this character, and, at this time, the Purchaser could
bear a complete loss of his investment. Further, the Purchaser will continue to
have, after making his investment in the Common Stock, adequate means of
providing for his current needs, the needs of those dependent on him, and
possible personal contingencies.
(d) Investment Intent. The Purchaser is purchasing the Common
Stock for investment purposes only and for his own account, and has no present
commitment, agreement or intention to sell, distribute or otherwise dispose of
any of them or to enter into any such commitment or agreement.
(e) No Public Market for the Common Stock. The Purchaser
understands that there is currently no public market for the Common Stock and
that even if a public market were to exist, there is no certainty that a public
market could be sustained or that the Common Stock could be easily liquidated.
(f) Rule 144. The Purchaser understands that he is an
"affiliate" of the Company as such term is defined in Rule 144 promulgated
under the Act. The Purchaser also understands that although the Common Stock
acquired by Purchaser in the Rights Offering will be registered pursuant to a
Form S-1 registration statement, the Common Stock acquired by Purchaser will be
deemed "control shares" and therefore for resale purposes will be subject to
the requirements and restrictions of Rule 144 (except the holding period),
unless such shares are again registered for resale in a subsequent registration
statement. Purchaser is familiar with the provisions of Rule 144 promulgated
under the Act, which, in substance, permits "affiliates" to sell unrestricted
securities pursuant to certain volume limitations and other requirements under
Rule 144 (except for the holding period, which does not apply to unrestricted
securities.)
(g) Non-Reliance Regarding Tax Consequences. The Purchaser is
not relying on the Company or any representation contained herein with respect
to the tax or economic effect of his investment in the Common Stock. The
Purchaser has reviewed with the Purchaser's own tax advisors the federal,
state, local and foreign tax consequences of this investment and the
transactions contemplated by this Agreement. The Purchaser is relying solely on
such advisors and not on any statements or representations of the Company or
any of its representatives. The Purchaser understands that he shall be
responsible for the Purchaser's own tax liability that may arise as a result of
this investment or the transactions contemplated by this Agreement. The
Purchaser understands that Section 83 of the Internal Revenue Code of 1986, as
amended (the "Code"), taxes as ordinary income the difference between the
purchase price for the Common Stock and the fair market value of the Common
Stock as of the date any restrictions on the Common Stock lapse.
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(h) Prohibitions on Cancellation, Termination, Revocation,
Transferability, and Assignment. The Purchaser hereby acknowledges and agrees
that, except as may be specifically provided herein or by applicable law, he is
not entitled to cancel, terminate, or revoke this Agreement. The Purchaser
further agrees that he may not transfer or assign its rights or obligations
under this Agreement without the written consent of the Company.
(i) Authority to Enter into Agreement. The Purchaser has the
full right, power and authority to execute and deliver this Agreement and
perform his obligations hereunder, and when executed and delivered, this
Agreement will constitute a valid and legally binding obligation of such
Purchaser.
(j) Legends. Each certificate representing the Common Stock
may be endorsed with the following legends:
The securities represented by this
certificate have been acquired for
investment and have not been registered
under the Securities Act of 1933, as
amended, or qualified under the laws of
any state. Such shares may not be sold or
transferred in the absence of such
registration or such qualification unless
the transfer is in accordance with Rule
144 or similar rule or unless the
corporation receives an opinion of
counsel reasonably acceptable to it
stating that such sale or transfer is
exempt from the registration and
prospectus delivery requirements of said
act and any applicable state securities
laws. Copies of the agreement covering
the purchase of these shares and
restricting their transfer may be
obtained at no cost by written request
made by the holder of record of this
certificate to the secretary of the
corporation at the principal executive
offices of the corporation.
5. Representations and Warranties of the Company. The Company
hereby represents, warrants and covenants to the Purchaser that, in connection
herewith:
(a) Ownership of Shares. The Company is the sole beneficial
and record owner of the Common Stock and that the Company has good, clear and
marketable title to the Common Stock, free of any liens, claims, contractual
restrictions, pledges, security interests or other encumbrances.
(b) Authority to Enter into Agreement. The Company has the
full right, power and authority to execute and deliver this Agreement and
perform his obligations hereunder.
6. Indemnification.
(a) The Company shall indemnify the Purchaser and hold him
harmless, upon demand, from and against any losses, damages, expenses or
liabilities, including without limitation
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reasonable attorneys' fees and expenses, which the Purchaser may sustain,
suffer or incur arising from or in connection with the Company's breach of any
covenant, representation, warranty, agreement, obligation or undertaking
hereunder. This indemnity shall survive the closing of the transactions
hereunder.
(b) The Purchaser shall indemnify the Company and hold him
harmless, upon demand, from and against any losses, damages, expenses or
liabilities, including without limitation reasonable attorneys' fees and
expenses, which the Company may sustain, suffer or incur arising from or in
connection with the Purchaser's breach of any covenant, representation,
warranty, agreement, obligation or undertaking hereunder. This indemnity shall
survive the closing of the transactions hereunder.
7. Governing Law; Jurisdiction. This Agreement will be governed
by, construed and enforced in accordance with the laws of the State of Florida.
8. Entire Agreement; Amendment. This Agreement constitutes the
entire agreement between the parties hereto with respect to the subject matter
hereof and supersedes and terminates any prior communication, agreement or
understanding, whether written or oral. This Agreement may be modified only by
a writing signed by all parties.
9. Notices. Except in instances where notice is otherwise
provided for in this Agreement, notices required to be given under this
Agreement shall be given in writing and hand delivered, or mailed by registered
or certified mail, return receipt requested, or sent by telecopier to 0000
Xxxxxxxx Xxxx, Xxxxx X, Xxxxxxxx, Xxxxxxx 00000, in the case of the Company,
and at the addresses set forth in the records of the Company, in the case of
the Purchaser. The date of delivery shall be the date received if delivered by
hand or sent by telecopier or facsimile, or within three (3) days of mailing,
if mailed. Any party may change the address to which notice shall be delivered
or mailed by notice duly given.
10. Benefits. This Agreement shall inure to the benefit of, and
be binding upon, the parties hereto and their respective heirs, beneficiaries,
legal representatives, successors, and assigns (including successive as well
immediate successors to and assigns of said parties).
11. Severability. In the event that any of the provisions of
this Agreement, or portions thereof, are held to be unenforceable or invalid by
any court of competent jurisdiction, the validity and enforceability of the
remaining provisions, or portions thereof, shall not be affected thereby.
12. Section Headings. The section headings contained herein are
for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
13. Execution in Counterparts. This Agreement may be executed in
several counterparts, each of which shall be an original and all of which
together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and the year first set forth above.
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THE COMPANY:
XXXXXXXXXX.XXX, INC.
By: /s/ O. F. XXXXX
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Name: O. F. XXXXX
Title: PRESIDENT AND
CHIEF EXECUTIVE OFFICER
{Signatures continued on following page}
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PURCHASERS:
/s/ O. F. XXXXX
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O. F. XXXXX
/s/ X. X. XXXXXX, JR.
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X. X. XXXXXX, JR.
/s/ XXXXXXX X. XXXXXX
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XXXXXXX X. XXXXXX
/s/ XXXXXX X. XXXXX
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XXXXXX X. XXXXX
/s/ XXXXXXX XXXX NORTH
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XXXXXXX XXXX NORTH
/s/ XXXXXX X. XXXXXX
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XXXXXX X. XXXXXX
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