SMITH & WESSON HOLDING CORPORATION
EXHIBIT 10.53
XXXXX & WESSON HOLDING CORPORATION
AGREEMENT made as of the 9th day of September 2005 (the “Effective Date”) by and among Xxxxx &
Wesson Holding Corporation, a Nevada corporation (the “Company”), Xxxxxxxx X. Xxxxx (“Xxxxx”),
Xxxxxx X. Xxxxx (“Xxxxx”), and Xxxxxx X. Xxxxx (“Xxxxx”) (Xxxxx, Xxxxx, and Xxxxx sometimes are
collectively referred to as the “Stockholders”).
RECITALS
WHEREAS, the Company is proposing to sell approximately 6,000,000 shares of its common stock
(“Common Stock”) in an offering (the “Offering”) that is exempt from the registration requirements
of the Securities Act of 1933 pursuant to Section 4(2) thereof;
WHEREAS, it is a condition of the Offering that the Company apply a portion of the proceeds of
the Offering to repurchase outstanding warrants held by Xxxxx and Xxxxx;
WHEREAS, it is a further condition of the Offering that the Company issue stock purchase
warrants (the “Warrants”), a draft of which is attached hereto, requiring the Company to issue to
the investors in the Offering (the “Investors”) up to an aggregate of 1,200,000 shares of the
Company’s Common Stock (the “Warrant Shares”), at the option of the Investors given at any time
commencing six months from the closing date of the Offering and ending seven months after the
closing date, for a price equal to the per share price of the Company’s Common Stock on the closing
date of the Offering plus $.02 per share (the “Exercise Price”);
WHEREAS, Xxxxx, Xxxxx, and Xxxxx have determined that they will gain significant benefits from
the Offering;
WHEREAS, Xxxxx, Xxxxx, and Xxxxx have agreed to sell shares of their Common Stock in the
Company in an aggregate amount equal to the shares covered by the Warrants at a price equal to the
Exercise Price plus any per share sales commissions for the Warrant Shares (together the “Strike
Price”) for a period ending ten days after the termination of the Warrants so that the Company can
avoid any additional dilution in the Offering.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises herein contained,
and for other good and valuable consideration; the receipt and sufficiency of which is hereby
acknowledged, the parties hereby agree as follows:
1. Agreement to Supply Shares. The Stockholders shall, within two business days of the
request by the Company, sell to the Company the number of shares of the Company’s Common Stock held
by them set forth beside their respective names below at a price equal to the Strike Price:
Xxxxx |
500,000 shares | |||
Xxxxx |
300,000 shares | |||
Xxxxx |
400,000 shares | |||
Without limiting the foregoing, the Stockholders hereby appoint the Chief Executive Officer and the
Chief Financial Officer of the Company as their attorneys-in-fact to take any and all steps
they deem necessary as appropriate, after consultation with the Company’s legal counsel, to
effectuate the transactions contemplated hereby, including canceling on the books of the Company
the shares set forth above in the event that the owner of such shares fails to sell such shares as
contemplated hereby.
2. Payment of Purchase Price. In the event of the purchase by the Investors of additional
shares of Common Stock pursuant to the Warrants, the Company will promptly forward to the
Stockholders as appropriate the Strike Price for each share sold.
3. Termination. This Agreement shall terminate ten days following the seven-month anniversary
of the closing date of the Offering.
4. Severability. If the application of any provision of this Agreement to any particular
facts or circumstances shall for any reason be held to be invalid, illegal, or unenforceable by a
court, arbitration panel, or other tribunal of competent jurisdiction, then (a) the validity,
legality, and enforceability of such provision as applied to any other particular facts or
circumstances, and the other provisions of this Agreement, shall not in any way be affected or
impaired thereby; and (b) such provision shall be enforced to the maximum extent possible so as to
effect the intent of the parties. If, moreover, any provision contained in this Agreement shall
for any reason be held to be excessively broad as to duration, geographical scope, activity, or
subject, it shall be construed by limiting and reducing such provision, so as to cause such
provision to be enforceable to the extent compatible with applicable law.
5. Specific Performance. The parties hereby declare that it is impossible to measure in money
the damages that would result from any breach of this Agreement. Therefore, each party hereto
waives any claim or defense that an adequate remedy at law exists in any action or proceeding
brought to enforce any of the provisions of this Agreement. In the case of any breach of this
Agreement, the non-breaching party shall be entitled to injunctive relief without the necessity of
proving actual damages.
6. Further Assurances. Each party shall execute and deliver such instruments, documents, and
assurances, and take such further actions as the other parties may reasonably request in order to
effectuate fully any of the provisions of this Agreement.
7. Governing Law. This Agreement shall be construed in accordance with and governed by the
internal laws of the state of Nevada, without giving effect to any choice of law rule that would
cause the application of the laws of any jurisdiction other than the internal laws of the state of
Nevada to the rights and duties of the parties.
8. Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same instrument. A
party may execute and deliver this Agreement by transmitting a facsimile copy of the executed
signature page to the other party.
9. Notice. All notices under this Agreement shall be in writing and shall be delivered by
personal service, overnight courier service, facsimile, or certified mail (if such service is not
available, then by first class mail), postage prepaid, to principal executive offices of the
Company or to the address of the Stockholders as appearing in the records of the
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Company, as appropriate. Any notice sent by certified mail shall be deemed to have been given
three business days after the date on which it is mailed. All other notices shall be deemed given
when received. No objection may be made to the manner of delivery of any notice actually received
in writing by an authorized agent of a party.
10. Successors and Assigns. This Agreement shall bind and inure to the benefit of the
successors, assigns, personal representatives, heirs, and legatees of the parties. Without
limiting the generality of the foregoing, the Company shall be entitled to assign to any person or
persons any or all of the Company’s rights under this Agreement, including, without limitation, the
Company’s rights under Section 1.
11. Amendment; Waiver. This Agreement shall not be amended except by a writing executed by
both of the parties. Any party may waive compliance by any other party with any of the covenants
or conditions herein, but no waiver shall be binding unless such waiver is in a writing executed by
the party making such waiver. No waiver of any of the provisions of this Agreement shall be
deemed, or shall constitute, a waiver of any other provision, whether or not similar, nor shall any
waiver constitute a continuing waiver.
12. Entire Agreement. This Agreement constitutes the entire agreement of the parties relating
to the subject matter hereof. Any prior oral or written agreements, promises, negotiations or
representations not expressly set forth in this Agreement are hereby rendered void and of no force
or effect.
13. Captions and Headings. The captions or headings of the provisions of this Agreement are
for reference only and are not to be construed in any way as part of this Agreement.
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IN WITNESS WHEREOF, the parties hereby execute this Agreement as of the Effective Date.
| XXXXX & WESSON HOLDING CORPORATION | STOCKHOLDERS | |||||
By:
|
/s/ Xxxxxxx X. Xxxxxx | /s/ Xxxxxxxx X. Xxxxx | ||||
Name:
|
Xxxxxxx X. Xxxxxx | Xxxxxxxx X. Xxxxx | ||||
Title:
|
President and Chief Executive Officer | |||||
| /s/ Xxxxxx X. Xxxxx | ||||||
| Xxxxxx X. Xxxxx | ||||||
| /s/ Xxxxxx X. Xxxxx | ||||||
| Xxxxxx X. Xxxxx | ||||||
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