SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT (the "Agreement"), dated as of December
4, 2000, by and among Essex Corporation, a Virginia corporation, with
headquarters located at 0000 Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000 (the
"Company"), and the investors listed on the Schedule of Buyers attached hereto
(individually, a "Buyer" and collectively, the "Buyers").
WHEREAS:
A. The Company and the Buyers are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by Rule 506 of Regulation D ("Regulation D") as promulgated by the United States
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "1933 Act").
B. The Buyers wish to purchase, upon the terms and conditions stated in
this Agreement, an aggregate of 160,000 shares of Common Stock, no par value
(the "Shares"), in the respective amounts set forth opposite each Buyer's name
on the Schedule of Buyers.
C. Contemporaneously with the execution and delivery of this Agreement,
the parties hereto are executing and delivering an amendment to the Registration
Rights Agreement, dated September 7, 2000, in the form attached hereto as
Exhibit A (the "Amended RRA") pursuant to which the Company has agreed to
provide the Buyers with certain registration rights under the 1933 Act and the
rules and regulations promulgated thereunder, and applicable state securities
laws.
NOW THEREFORE, the Company and the Buyers hereby agree as follows:
1. PURCHASE AND SALE OF SHARES.
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(a) Purchase of Shares. At the Closing, as defined below, the
Company shall issue and sell to each Buyer and each Buyer severally agrees to
purchase from the Company the respective number of Shares set forth opposite
such Buyer's name on the Schedule of Buyers at such Closing at a price of $2.50
per Share.
(b) The Closing. The closing of the transaction contemplated
hereby (the "Closing") shall occur at the offices of the Company on or before
December 31, 2000. At the Closing, (A) each Buyer shall pay the purchase price
to the Company for the Shares to be issued and sold to such Buyer by check or
wire transfer, and (B) the Company shall deliver instructions to its transfer
agent to complete and deliver to each Buyer promptly after closing a stock
certificate (collectively, the "Stock Certificates") representing the number of
the Shares which such Buyer is then purchasing hereunder, duly executed on
behalf of the Company and registered in the name of such Buyer or its designee.
2. BUYERS' REPRESENTATIONS AND WARRANTIES.
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Each Buyer represents and warrants with respect only to itself
that:
(a) Investment Purpose. Such Buyer (i) is acquiring the Shares
being purchased by it for its own account for investment only and not with a
view towards, or for resale in connection with, the public sale or distribution
thereof, except pursuant to sales registered or exempted under the 1933 Act;
provided, however, that by making the representations herein, such Buyer does
not agree to hold any of the Shares for any minimum or other specific term and
reserves the right to dispose of the Shares at any time, provided further,
however, that such disposition shall be in accordance with or pursuant to a
registration statement or an exemption under the 1933 Act.
(b) Accredited Investor Status. Such Buyer is an "accredited
investor" as that term is defined in Rule 501(a)(3) of Regulation D under the
1933 Act.
(c) Reliance on Exemptions. Such Buyer understands that the
Shares are being offered and sold to it in reliance on specific exemptions from
the registration requirements of the United States federal and state securities
laws and that the Company is relying in part upon the truth and accuracy of, and
such Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of such Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of such Buyer
to acquire the Shares.
(d) Information. Such Buyer and its advisors, if any, have
been furnished with all materials relating to the business, finances and
operations of the Company and materials relating to the offer and sale of the
Shares which have been requested by such Buyer. Such Buyer and its advisors, if
any, have been afforded the opportunity to ask questions of the Company.
(e) Residency. Such Buyer is purchasing the Shares from
its office specified in its address on the Schedule of Buyers.
3. COVENANTS.
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(a) Best Efforts. Each party shall use its best efforts to
timely satisfy each of the conditions to be satisfied by it as provided in
Sections 4 and 5 of this Agreement.
(b) Form D and Blue Sky. The Company agrees to file a Form D
with respect to the Shares as required under Regulation D and to provide a copy
thereof to each Buyer promptly after such filing. The Company shall take such
action as the Company shall reasonably determine is necessary in order to obtain
an exemption for or to qualify the Shares for sale to the Buyers pursuant to
this Agreement under applicable securities or "Blue Sky" laws of the
jurisdictions set forth in the Schedule of Buyers, and shall provide evidence of
any such action so taken to the Buyers.
(c) Use of Proceeds. The Company will use the proceeds from
the sale of the Shares substantially for the repayment of its outstanding
debentures maturing November 30, 2000.
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4. CONDITIONS TO THE COMPANY'S OBLIGATIONS. The obligation of the
Company to issue and sell the Shares to each Buyer is subject to the
satisfaction, at or before the Closing, of each of the following conditions,
provided that these conditions are for the Company's sole benefit and may be
waived by the Company at any time in its sole discretion by providing each Buyer
with prior written notice thereof:
(a) As of the Closing, such Buyer shall have executed this
Agreement and the Amended RRA and delivered the same to the Company.
(b) The representations and warranties of such Buyer shall be
true and correct in all material respects as of the Closing and such
Buyer shall have performed, satisfied and complied with the covenants,
agreements and conditions required to be performed, satisfied or
complied with by such Buyer at or prior to the Closing.
5. CONDITIONS TO EACH BUYER'S OBLIGATIONS. The obligation of each Buyer
hereunder to purchase the Shares from the Company is subject to the
satisfaction, at or before the date of the Closing, of each of the following
conditions, provided that these conditions are for each Buyer's sole benefit and
may be waived by such Buyer at any time in its sole discretion by providing the
Company with prior written notice thereof:
(a) The Company shall have executed this Agreement and the
Amended RRA and delivered the same to such Buyer.
(b) The Company shall cause its transfer agent to execute for
delivery to such Buyer the Stock Certificates (in such denominations as
such Buyer shall request) for the Shares being purchased by such Buyer.
(c) The Board of Directors of the Company shall have adopted
resolutions in a form reasonably acceptable to such Buyer (the
"Resolutions").
(d) The Company shall have made all filings under all
applicable federal and state securities laws necessary to consummate
the issuance of the Shares pursuant to this Agreement in compliance
with such laws.
6. MISCELLANEOUS.
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(a) Governing Law; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the Commonwealth of Virginia, without giving
effect to any choice of law or conflict of law provision or rule. EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A
JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.
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(b) Counterparts. This Agreement may be executed in two or
more identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party; provided that a facsimile signature
shall be considered due execution and shall be binding upon the signatory
thereto with the same force and effect as if the signature were an original, not
a facsimile signature.
(c) Headings. The headings of this Agreement are for
convenience of reference and shall not form part of,or affect the interpretation
of, this Agreement.
(d) Severability. If any provision of this Agreement shall be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
(e) Entire Agreement; Amendments. This Agreement supersedes
all other prior oral or written agreements between each Buyer, the Company,
their affiliates and persons acting on their behalf with respect to the matters
discussed herein, and this Agreement and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor any Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters. No provision of this
Agreement may be amended or waived other than by an instrument in writing signed
by the Company and the Buyers.
(f) Notices. Any notices, consents, waivers or other
communications required or permitted to be given under the terms of this
Agreement must be in writing and will be deemed to have been delivered: (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by facsimile
(provided confirmation of transmission is mechanically or electronically
generated and kept on file by the sending party); or (iii) one (1) business day
after deposit with a nationally recognized overnight delivery service, in each
case properly addressed to the party to receive the same. The addresses and
facsimile numbers for such communications shall be:
If to the Company:
Essex Corporation
0000 Xxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Attention: Xxxxxxx X. Xxxxxxxxx, President
With a copy to:
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D. Xxxxx Xxxxx
Xxxxxxxxx, Xxxxxx & Xxxxxxx L.L.P.
0 Xxxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Telephone: 000-000-0000
Facsimile: 000-000-0000
If to a Buyer, to it at the address and facsimile number set
forth on the Schedule of Buyers, with copies to such Buyer's representatives as
set forth on the Schedule of Buyers, or at such other address and/or facsimile
number and/or to the attention of such other person as the recipient party has
specified by written notice given to each other party five days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender's facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a nationally recognized overnight
delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.
(g) Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
assigns, including any purchasers of the Shares. The Company shall not assign
this Agreement or any rights or obligations hereunder including by merger or
consolidation without the prior written consent of the Buyers.
(h) No Third Party Beneficiaries. This Agreement is intended
for the benefit of the parties hereto and their respective permitted successors
and assigns, and is not for the benefit of, nor may any provision hereof be
enforced by, any other person.
(i) Survival. The representations and warranties of the Buyers
contained in Section 2 and the agreements and covenants set forth in Sections 3,
4, and 5 shall survive the Closing. Each Buyer shall be responsible only for its
own representations, warranties, agreements and covenants hereunder.
(j) Publicity. The Company and each Buyer shall have the right
to approve before issuance any press releases or any other public statements
with respect to the transactions contemplated hereby, such consent not to be
unreasonably withheld.
(k) Further Assurances. Each party shall do and perform, or
cause to be done and performed, all such further acts and things, and shall
execute and deliver all such other agreements, certificates, instruments and
documents, as the other party may reasonably request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
(l) Brokers; Placement Agent. The Company acknowledges that it
has not engaged a broker or placement agent in connection with the sale of the
Shares. The Company shall pay, and hold each Buyer harmless against, any
liability, loss or expense (including, without
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limitation, attorney's fees and out-of-pocket expenses) arising in connection
with any such claim for brokers', financial advisory or similar fees in
connection with such transaction.
IN WITNESS WHEREOF, the Buyers and the Company have caused this Securities
Purchase Agreement to be duly executed as of the date first written above.
COMPANY:
ESSEX CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: President and CEO
BUYERS:
GEF OPTICAL INVESTMENT
COMPANY, LLC
By: /s/ H. Xxxxxxx Xxxxxxx
Name: H. Xxxxxxx Xxxxxxx
Title: President
NETWORKING VENTURES, L.L.C.
By: /s/ Xxxx X. Xxxxxx
Name: Xxxx X. Xxxxxx
Title: Partner
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SCHEDULE OF BUYERS
Investor Address
Investor Name And Facsimile Number Number of Shares
GEF Optical Investment 0000 Xxx Xxxxxx, X.X., Xxxxx 000 80,000
Company, LLC Xxxxxxxxxx, XX 00000
Attn: Xx. Xxxxx Xxxxxxx, Esq.
Fax No. 000-000-0000
Networking Ventures, L.L.C. 0000 Xxxxxxxx Xxxx 00,000
Xxxxxxxx, XX 00000
Attn: Xx. Xxxxxxxx X. Xxxxxx
Fax No. 000-000-0000
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EXHIBITS
Exhibit A Form of Amended RRA
(See Exhibit 99.4)
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