SERIES B PREFERRED STOCK PURCHASE AGREEMENT
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ONLINE SPECIALTY RETAILING, INC.
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
This Agreement is made as of March 18, 1999, by and among Online Specialty
Retailing, Inc., a Washington corporation (the "Company"), with its principal
office at 0000 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000, and the
investors listed on the Schedule of Purchasers attached as EXHIBIT 1.2 (the
"Purchasers").
The Company and the Purchasers hereby agree as follows:
1. AUTHORIZATION AND SALE OF PREFERRED STOCK
1.1. AUTHORIZATION. The Company will authorize the sale and issuance of
up to 766,667 shares of its Series B Preferred Stock ("Series B
Preferred"), having the rights, restrictions, privileges and
preferences as set forth in the Certificate of Designation,
substantially in the form attached hereto as EXHIBIT 1.1 (the
"Certificate of Designation"). The Series B Preferred to be sold
pursuant to this Agreement shall be referred to as the "Shares."
1.2. SALE OF SERIES B PREFERRED. Subject to the terms and conditions
hereof, the Company will issue and sell to the Purchasers, and the
Purchasers will buy from the Company, the number of Shares set forth
opposite each Purchaser's name on the Schedule of Purchasers attached
hereto as EXHIBIT 1.2, at a purchase price of $3.00 per Share. The
Company's agreements with each of the Purchasers are separate
agreements, and the sales of the Shares to each of the Purchasers are
separate sales.
2. CLOSING DATE; DELIVERY
2.1. CLOSING DATE. The initial closing of the purchase and sale of the
Shares hereunder (the "Initial Closing") shall be held following the
receipt by the Company of subscriptions for at least 200,000 Shares
(the date of such Initial Closing being referred to as the "Initial
Closing Date"). The place of the Initial Closing shall be at the
offices of Xxxxxx Xxxxxx White & XxXxxxxxx, 6100 Columbia Center, 000
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000, or such other place as the
Purchasers and the Company shall agree.
2.2. SUBSEQUENT CLOSINGS. At any time on or prior to December 31, 1999
the Company may sell, in one or more transactions, up to the balance
of the Shares authorized to be sold pursuant to this Agreement and
not sold at the Initial Closing (a "Subsequent Closing"). The date
of any such Subsequent Closing shall be referred to herein as a
"Subsequent Closing Date." Any sale of Shares at a Subsequent
Closing shall be on the same terms and conditions set forth in this
Agreement by execution of this Agreement by the Purchasers of Shares
in such Subsequent Closing. Purchasers of Shares sold pursuant to
this subsection 2.2 who execute this Agreement as Purchasers shall be
deemed to be "Purchasers" for all purposes under this Agreement. In
connection with any Subsequent Closing, the Company may add the names
of additional Purchasers to EXHIBIT 1.2, without any action on the
part of the Purchasers in the previous Closings.
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2.3. DELIVERY. At the Initial Closing or any Subsequent Closing, as the
case may be, subject to the terms and conditions set forth in this
Agreement, the Company will deliver to each Purchaser a certificate
representing the number of Shares to be purchased by that Purchaser
at such Closing (which is set forth opposite that Purchaser's name on
the Schedule of Purchasers) against payment of the purchase price
therefor (which is set forth opposite that Purchaser's name on the
Schedule of Purchasers) by check or wire transfer payable to the
Company.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth on the Schedule of Exceptions attached hereto as EXHIBIT 3,
(the "Schedule of Exceptions") or as otherwise expressly contemplated by this
Agreement, as of the Initial Closing Date, and as of each Subsequent Closing
Date, the Company hereby represents and warrants to each Purchaser as follows:
3.1. ORGANIZATION AND STANDING. The Company is a corporation duly
organized, validly existing and in good standing under the laws of
the State of Washington. The Company has requisite corporate power
to own and operate its properties and assets and to carry on its
business as presently conducted and as presently proposed to be
conducted.
3.2. CORPORATE POWER. The Company has all requisite legal and corporate
power to execute and deliver this Agreement and all agreements to be
executed and delivered by the Company pursuant to the terms of this
Agreement (collectively, the "Ancillary Agreements") to sell and
issue the Shares hereunder, to issue the Common Stock issuable upon
conversion of the Shares, and to carry out and perform its
obligations under the terms of this Agreement and the Ancillary
Agreements.
3.3. AUTHORIZATION. All corporate action on the part of the Company, its
directors and shareholders necessary for the authorization,
execution, delivery and performance of this Agreement and the
Ancillary Agreements by the Company, the authorization, sale,
issuance and delivery of the Shares (and the Common Stock issuable
upon conversion of the Shares) and the performance of the Company's
obligations under this Agreement and under the Ancillary Agreements
has been taken. Subject to satisfaction of the conditions set forth
in Sections 5 below, this Agreement and the Ancillary Agreements,
when executed and delivered by the Company, shall constitute valid
and binding obligations of the Company enforceable against the
Company in accordance with their respective terms, except as rights
to indemnity and contribution thereunder may be limited by applicable
law and public policy and subject (i) to bankruptcy, insolvency,
reorganization, arrangement, moratorium and other laws of general
applicability relating to or affecting creditors' rights and (ii) to
general principles of equity, whether such enforceability is
considered in a proceeding in equity or at law.
3.4. CAPITALIZATION. At the time of the Initial Closing, the authorized
capital stock of the Company will consist of 20,000,000 shares of
Common Stock and 5,000,000 shares of Preferred Stock, 1,142,857
shares of which are designated "Series A Preferred Stock" and
1,000,000 shares of which will, upon filing of the Certificate of
Designation with the Secretary of State of the State of Washington,
be designated Series B Preferred. Without giving effect to the
issuance of the Shares to be issued under this Agreement at the
Initial Closing or any Subsequent Closing, 1,579,164 shares of Common
Stock,
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1,142,857 shares of Series A Preferred Stock and no shares of Series
B Preferred Stock will be issued and outstanding. Upon the payment
for and issuance of the Shares in accordance with the terms and
conditions of this Agreement, the Ancillary Agreements and the
Certificate of Designation, all issued and outstanding shares of
capital stock of the Company will be duly authorized, validly issued,
fully paid and nonassessable. The Company has reserved (i) 766,667
shares of Series B Preferred for issuance hereunder, (ii) sufficient
shares of Common Stock for issuance upon conversion of the Shares,
which upon issuance and delivery in accordance with this Agreement
and the Certificate of Designation, will be duly authorized, validly
issued, fully paid and nonassessable, (iii) sufficient shares of
Common Stock for issuance upon conversion of the Series A Preferred
Stock, and (iv) 1,000,000 shares of Common Stock issuable at any time
to employees, officers, directors, consultants and advisors of the
Company pursuant the Company's 1997 Stock Incentive Plan (the
"Incentive Plan"). The Series B Preferred shall have the rights,
preferences, privileges and restrictions set forth in the Certificate
of Designation.
3.5. FINANCIAL STATEMENTS. The Company has provided to each Purchaser an
unaudited preliminary estimated balance sheet as of December 31, 1998
and unaudited preliminary estimated statements of operations,
stockholders' equity and cash flows for the year then ended (the
"Financial Statements").
3.6. PATENTS, TRADEMARKS, ETC. The Company owns or has sufficient legal
right to use all patents, trademarks, service marks, trade names,
copyrights, licenses, trade secrets, information and other
proprietary rights necessary to conduct its business as now
conducted and as presently proposed to be conducted (the
"Intellectual Properties") and, the Company has not received any
communications alleging that the Company has violated, infringed upon
or otherwise acted adverse to, or, by conducting its business (as now
conducted and as presently proposed to be conducted) would violate,
infringe upon or otherwise be adverse to any patent, trademark,
service xxxx, trade name, copyright or trade secret or other
proprietary right of any other person or entity.
3.7. COMPLIANCE WITH AGREEMENTS AND LAWS. The Company is not in violation
or default in any material respect of any term or provision of any
material mortgage, indenture, contract, agreement or instrument to
which it is a party or by which it is bound or of any judgment,
order, writ or decree applicable to it and, to its knowledge, is not
in violation of any order, statute, rule or regulation applicable to
the Company, which violation reasonably would be expected to have a
material adverse effect on the Company's business, assets,
liabilities, financial condition or operations. The execution,
delivery and performance of and compliance with this Agreement and
the Ancillary Agreements, and the issuance of the Shares and the
Common Stock issuable upon conversion of the Shares, will not, with
or without the passage of time or giving notice, result in any
violation of, or conflict with, or constitute a default under, or
result in the creation of, any material mortgage, pledge, lien,
encumbrance or charge upon any of the properties or assets of the
Company, or the suspension, revocation, impairment, forfeiture or
non-renewal of any permit, license, authorization or approval
applicable to the Company, its business or operation, or any of its
assets or properties.
3.8. LITIGATION. There are no actions, suits, proceedings or
investigations pending against the Company or its properties before
any court or governmental agency (nor, to the
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Company's knowledge, is there any written threat thereof), which,
either individually or in the aggregate, reasonably would be expected
to result in any material adverse change in the business or financial
condition of the Company or any of its properties or assets, or in
any material impairment of the right or ability of the Company to
carry on its business as now conducted or as presently proposed to be
conducted, or in any material liability on the part of the Company.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company and agrees with
respect to his, her or its purchase of the Shares as follows:
4.1. AUTHORIZATION. All acts and conditions necessary for the
authorization, execution, delivery and consummation by such Purchaser
of this Agreement and the Ancillary Agreements and the transactions
contemplated herein and therein have been taken, performed and
obtained. This Agreement and the Ancillary Agreements constitute
valid and legally binding obligations of such Purchaser, enforceable
against such Purchaser in accordance with their respective terms,
except as rights to indemnity and contribution thereunder may be
limited by applicable law and public policy and subject, as to
enforcement, (i) to bankruptcy, insolvency, reorganization,
arrangement, moratorium and other laws of general applicability
relating to or affecting creditors' rights and (ii) to general
principles of equity, whether such enforceability is considered in a
proceeding in equity or at law.
4.2. INVESTMENT REPRESENTATIONS AND COVENANTS OF THE PURCHASERS.
4.2.1. Each Purchaser acknowledges that this Agreement is made by
the Company with such Purchaser in reliance upon such
Purchaser's representations and covenants made in this
Section 4. Each Purchaser represents that the Shares to be
received will be acquired for investment for such
Purchaser's own account, not as a nominee or agent, and not
with a view to the sale or distribution of any part thereof,
and that such Purchaser has no present intention of selling,
granting any participation in or otherwise distributing the
same. Each Purchaser further represents that such Purchaser
does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant
participations to such person or to any third person, with
respect to any of the Shares or any Common Stock acquired on
conversion or exercise thereof (collectively, "Restricted
Securities ").
4.2.2. Each Purchaser understands and acknowledges that the
offering of the Shares pursuant to this Agreement will not,
and any issuance of Common Stock on conversion of the Shares
will not, be registered under the Securities Act or under
the securities laws of any jurisdiction, on the ground that
the sale provided for in this Agreement and the issuance of
such securities hereunder is exempt pursuant to Section 4(2)
of the Securities Act, and similar provisions of applicable
state securities laws and that the Company's reliance on
such exemptions is predicated on the accuracy of the
Purchasers' representations set forth herein.
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4.2.3. Each Purchaser covenants that in no event will he, she or it
make any disposition of any Restricted Securities, except in
accordance with applicable federal and state securities laws.
4.2.4. Each Purchaser represents that such Purchaser is experienced
in evaluating developmental stage companies such as the
Company, is able to fend for himself, herself or itself in
transactions such as the one contemplated by this Agreement,
has such knowledge and experience in financial and business
matters that such Purchaser is capable of evaluating the
merits and risks of its prospective investment in the
Company, and has the ability to bear the economic risks of
the investment (including possible complete loss of such
investment) for an indefinite period of time. Each
Purchaser which is not an individual confirms that it was
not organized for the purpose of acquiring the Restricted
Securities.
4.2.5. Each Purchaser acknowledges and understands that the
Restricted Securities must be held indefinitely unless they
are subsequently registered under the Securities Act or an
exemption from such registration is available, and that,
except as otherwise provided in the Investors' Rights
Agreement, the Company is under no obligation to register
the Restricted Securities.
4.2.6. Each Purchaser acknowledges that in the event the applicable
requirements of Rule 144 under the Securities Act ("Rule
144") are not met, registration under the Securities Act or
compliance with another exemption from registration will be
required for any disposition of the Restricted Securities.
Each Purchaser understands that although Rule 144 is not
exclusive, the Securities and Exchange Commission (the
"Commission") has expressed its opinion that persons
proposing to sell restricted securities received in a
private offering other than in a registered offering or
pursuant to Rule 144 will have a substantial burden of proof
in establishing that an exemption from registration is
available for such offers or sales and that such persons and
the brokers who participate in the transactions do so at
their own risk.
4.2.7. Each Purchaser agrees to comply in all respects with the
provisions of this Section 4. Prior to any proposed sale,
assignment, transfer or pledge of any Restricted Securities,
unless there is in effect a registration statement under the
Securities Act covering the proposed transfer, the holder
thereof shall give written notice to the Company of such
holder's intention to effect such transfer, sale, assignment
or pledge. Each such notice shall describe the manner and
circumstances of the proposed transfer, sale, assignment or
pledge in sufficient detail and, if the Company reasonably
so requests, shall be accompanied at such holder's expense
by an opinion of legal counsel which shall be reasonably
satisfactory to the Company, which opinion shall be
addressed to the Company, to the effect that the proposed
transfer of the Restricted Securities may be effected
without registration under the Securities Act, whereupon the
holder of such Restricted Securities shall be entitled to
transfer such Restricted Securities in accordance with the
terms of the notice delivered by the holder to the Company.
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4.2.8. Each Purchaser represents that one or more of the following
criteria are applicable to such Purchaser:
(i) The Purchaser is a natural person who has a net worth or
joint net worth with the Purchaser's spouse exceeding
$1,000,000 at the time of purchase; or
(ii) The Purchaser is a natural person who had an individual
income in excess of $200,000 in each of the two most recent
years or joint income with that person's spouse in excess of
$300,000 in each of those years and who reasonably expects
reaching the same income level in the current year; or
(iii) The Purchaser is either (a) an investment company registered
under the Investment Company Act of 1940 or a business
development company as defined in section 2(a)(48) of such
Act, (b) a Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or
(d) of the Small Business Investment Act of 1958 or (c) a
private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940; or
(iv) The Purchaser is a corporation, partnership, not-for-profit
organization or entity exempt from income tax under Section
501(c)(3) of the Internal Revenue Code, not formed for the
specific purpose of acquiring the Shares, with total assets
in excess of $5,000,000; or
(v) The Purchaser is a corporation, partnership or trust and
each and every equity owner of such entity meets the
qualifications set forth in subsection (i), (ii), (iii) or
(iv) of this SECTION 4.2.8.
4.2.9. Each Purchaser represents that such Purchaser is a resident
of, or if not an individual, has its principal place of
business in, the state set forth below the Purchaser's name
on the signature pages hereto.
4.3. LEGEND ON CERTIFICATES. Each Purchaser consents to the placement of a
legend on the certificates for the Shares, and any shares of Common
Stock issued on the conversion of the Shares, in substantially the
following form:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED ("SECURITIES ACT"), OR UNDER ANY STATE
SECURITIES LAWS. THESE SECURITIES MAY NOT BE SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED WITHOUT REGISTRATION
UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES
LAWS UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH TRANSFER
DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT OR ANY
OTHER STATE SECURITIES LAWS.
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4.4. NO PUBLIC MARKET. Each Purchaser understands that no public market
now exists for any of the securities issued by the Company and that
it is unlikely that a public market will ever exist for the Shares.
4.5. RECEIPT OF INFORMATION. Each Purchaser has received and reviewed
this Agreement (including exhibits), the Ancillary Agreements, the
Financial Statements, and the business plan of the Company dated
February, 1999 (the "Business Plan") and each Purchaser and such
Purchaser's attorney, accountant and other advisers have had access
to, and an opportunity to review, all corporate books, financial
statements, records, contracts, documents and other materials
concerning the Company (to the extent such exists), and its offices
and facilities; and have been given an opportunity to ask any and all
questions of, and receive answers from, the Company's officers,
employees, agents, accountants and representatives concerning the
Company's proposed business, operations, financial condition, assets,
liabilities, the terms and conditions of the offering and other
relevant matters as they have deemed necessary or appropriate to
verify the accuracy of the information provided and to evaluate the
suitability of an investment in the Shares; and, in evaluating the
suitability of an investment in the Shares they have not relied upon
any representations or other information (whether oral or written)
other than as set forth in the documents and answers referred to
above. Each of the Purchasers further represents and acknowledges
that such Purchaser has been solely responsible for his, her or its
own "due diligence" investigation of the Company and its management
and business, for his, her or its own analysis of the merits and
risks of this investment, and for his, her or its own analysis of the
fairness and desirability of the terms of the investment, that in
taking any action or performing any role relative to the arranging of
the proposed investment, each of the other Purchasers has acted
solely in his, her or its own interest, and that none of the
Purchasers (or any of their agents or employees) has acted as an
agent, employee, partner or fiduciary of any other Purchaser, or as
an agent of the Company, or as an issuer, underwriter, broker, dealer
or investment adviser relative to any security involved in this
investment.
4.6. BROKERS OR FINDERS. Each Purchaser has not incurred, and will not
incur directly or indirectly, any liability for brokerage or finders'
fees or agents' commissions or any similar charges in connection with
this Agreement or any transactions contemplated hereby. Each
Purchaser hereby agrees to indemnify the Company for any claims,
losses, and expenses incurred by the Company as a result of the
representation in this Section 4.6 being untrue.
4.7. COMPANY INFORMATION. Each Purchaser acknowledges that the
information regarding the Company disclosed to such Purchaser and the
information provided to such Purchaser pursuant to this Agreement,
Ancillary Agreements and the Business Plan is confidential and/or
proprietary to the Company (the "Confidential Information"). Each
Purchaser agrees not to disclose Confidential Information to any
third parties and to keep the Confidential Information confidential,
using the same standard of care in safeguarding the Confidential
Information as a prudent business person would employ in protecting
its own proprietary information which it desires not to disseminate
or publish. Each Purchaser will instruct such Purchaser's directors,
officers, employees, and representatives to so keep such Confidential
Information confidential. Confidential Information does not include
information, technical data or know-how which (a) is in
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such Purchaser's possession at the time of disclosure to the such
Purchaser as shown by such Purchaser's files and records immediately
prior to the time of disclosure; (b) before or after it has been
disclosed to such Purchaser, is part of the public knowledge or
literature, not as a result of any action or inaction of such
Purchaser; (c) is independently developed by such Purchaser, as
properly documented by such Purchaser; or (d) is approved for release
by written authorization of Company.
5. CONDITIONS TO CLOSING OF PURCHASERS
The Purchasers' obligations to purchase the Shares at the Initial Closing, or
any Subsequent Closing, as the case may be, are, at the option of each
Purchaser, subject to the fulfillment on or prior to the Initial Closing Date,
or any Subsequent Closing Date at which such Shares are purchased, of the
following conditions:
5.1. REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties made by the Company in Section 3 shall be true and correct
on the Initial Closing Date or any Subsequent Closing Date, as the
case may be, with the same force and effect as if they had been made
on and as of said date, except for representations and warranties
made as of a specific date, which shall be true and correct as of
such date.
5.2. FILING OF CERTIFICATE OF DESIGNATION. The Certificate of Designation
shall have been duly filed with the Secretary of State of the State
of Washington.
5.3. INVESTORS' RIGHTS AGREEMENT. The Company, each other party to the
Company's existing Investors' Rights Agreement dated July 17, 1998,
and each Purchaser shall have executed the Amended and Restated
Investors' Rights Agreement in substantially the form attached hereto
as EXHIBIT 5.3 (the "Investors' Rights Agreement")..
6. CONDITIONS TO CLOSING BY COMPANY
The Company's obligation to sell and issue the Shares at the Initial Closing or
any Subsequent Closing, as the case may be, is, at the option of the Company,
subject to the fulfillment on or prior to the Initial Closing Date, or any
Subsequent Closing Date at which such Share are sold, of the following
conditions:
6.1. REPRESENTATIONS AND WARRANTIES CORRECT. The representations and
warranties of each Purchaser made in Section 4 shall be true and
correct when made, and shall be true and correct on the Initial
Closing Date or any Subsequent Closing Date, as the case may be, with
the same force and effect as though such representations and
warranties had been made as of such Closing Date.
6.2. OTHER CONDITIONS. The conditions set forth at Section 5.2 shall have
been satisfied.
6.3. PAYMENT OF PURCHASE PRICE. Each Purchaser shall have delivered to
the Company in accordance with Section 2.3 the purchase price
specified in Section 1.2.
6.4. PERFORMANCE. Each Purchaser 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 Initial Closing Date or any Subsequent Closing Date, as
the case may be.
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7. MISCELLANEOUS
7.1. NOTICES, ETC. Any notice given under this Agreement shall be in
writing and delivered in person, via facsimile machine, sent by
documented overnight delivery service, or mailed by certified or
registered mail, postage prepaid, to the appropriate party or parties
at the addresses referenced below, or to such other address as the
parties may hereinafter designate. Unless otherwise specified in
this Agreement, all such notices and other written communications
shall be effective (and considered received for the purposes of this
Agreement) (a) if delivered in person, upon delivery, (b) if by
facsimile machine during normal business hours upon transmission with
confirmation of receipt by the receiving party's facsimile terminal
and if not sent during normal business hours, then on the next
business day, (c) if sent by documented overnight delivery service,
on the date delivered, or (d) if mailed, three (3) days after
mailing. Notices shall be sent (i) if to a Purchaser, at such
Purchaser's address set forth in this Agreement, or at such other
address as such Purchaser shall have furnished to the Company in
writing, or (ii) if to the Company, one copy should be sent to its
address set forth on the first page of this Agreement, or at such
other address as the Company shall have furnished to the Purchasers,
and addressed to the attention of Xxxxxxxx X. Xxxxxx, and one copy
shall be sent to Xxxxxx Xxxxxx White & XxXxxxxxx, 6100 Columbia
Center, 000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000, Attn: Xxxxxx X.
Xxxxx.
7.2. GOVERNING LAW AND VENUE. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of
Washington (without giving effect to any choice or conflict of law
provision or rule, whether of the State of Washington or any other
jurisdiction, that would cause the application of the laws of any
jurisdiction other than the State of Washington). The venue of any
arbitration or action brought on or in connection with this Agreement
shall be in King County, Washington.
7.3. CONSENT TO JURISDICTION. The parties hereto irrevocably submit to
the jurisdiction of any Washington state or federal court sitting in
Seattle in any action or proceeding arising out of or relating to
this Agreement, and agree that all claims in respect of such action
or proceeding may be heard and determined in such Washington state or
federal court. Each party hereby waives, to the fullest extent it
may effectively do so, the defense of any inconvenient forum to the
maintenance of such action or proceeding. The parties agree that a
final judgment in any action or proceeding shall be conclusive and
may be enforced in any other manner provided by law.
7.4. COSTS AND ATTORNEY'S FEES. If any action at law or equity is
necessary to enforce or interpret the terms of this Agreement, the
mostly prevailing party shall be entitled to reasonable attorneys'
fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled, including any such fees,
costs and necessary disbursements incurred in any appellate
proceeding.
7.5. SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon,
the successors, assigns, heirs, executors, and administrators of the
parties hereto; provided, however, that, except as otherwise provided
herein, the rights of a Purchaser to purchase Shares shall not be
assignable without the written consent of the Company.
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7.6. THIRD PARTY BENEFICIARIES. This Agreement shall not confer any
rights or remedies upon any person or entity other than the parties
and their respective successors and permitted assigns.
7.7. ENTIRE AGREEMENT; AMENDMENT. This Agreement, the Ancillary
Agreements, the Certificate of Designation and the other documents
delivered pursuant to those agreements constitute the full and entire
understanding and agreement between the parties with regard to the
subject matter hereof and thereof, and supersede all prior
agreements, contracts or understandings with respect to the subject
matter hereof. This Agreement may be amended or modified, and the
obligations of the Company under Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only upon the written consent of the Company and
holders of a majority of the Shares (treated as if converted and
including any Common Stock into which the Shares have been converted
that have not been sold to the public); any such amendment,
modification or waiver shall be binding on the Company, all holders
of any securities purchased under this Agreement at the time
outstanding (including securities into which such securities are
convertible) and each future holder of any such securities. The
foregoing notwithstanding, this Agreement and any term hereof may be
amended, waived, discharged or terminated by a written instrument
signed by the party against whom enforcement of any such amendment,
waiver, discharge or termination is sought.
7.8. INTERPRETATION AND FAIR CONSTRUCTION. This Agreement has been
reviewed and approved by each of the parties. If it should be
determined that any provision of this Agreement is uncertain or
ambiguous, the language in all parts of this Agreement shall be in
all cases construed as a whole according to its fair meaning and not
strictly construed for or against either the Company or the
Purchasers.
7.9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties
actually executing such counterparts, and all of which together shall
constitute one instrument.
7.10. SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full
force and effect without said provision.
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Online Specialty Retailing, Inc. dba XxxxxXxxx.xxx Page 10
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
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The foregoing Series B Preferred Stock Purchase Agreement is hereby executed.
COMPANY:
ONLINE SPECIALTY RETAILING, INC.
By: ------------------------------
Xxxxxxxx X. Xxxxxx, Chairman
PURCHASER(S):
----------------------------------------
Signature
Social Security or Tax ID Number:-------
----------------------------------------
Signature
Social Security or Tax ID Number:-------
Name (as it will appear on share certificate):
Full Mailing Address:
Fax:
Telephone:
E-mail address:
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Online Specialty Retailing, Inc. dba XxxxxXxxx.xxx Page 11
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
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Investor List
PURCHASER NO. OF SHARES PURCHASED
--------- -----------------------
Xxxxxxxx X. Xxxxxx 5,000
Xxxxx X. Xxxxxx Trust FBO 66,666
Stockton Rush III
Xxxxx X. Xxxxx and Xxx XxXxxx 33,333
Xxxxx (WYNOT Investments)
Xxxxx Xxxxxx and Xxxxxxx Xxxxxx-Xxxxxxx 5,000
Xxxxxx X. Xxxxxx 3,333
X. Xxxxxxxx Rush 16,666
Xxxxxx X. Xxxxxx 33,333
X. X. Xxxxxxx Trust 66,666
Xxxxxxx Xxxxxx & Ziker Investment 19,194
Partnership (1999)
Xxxxxxx X. Xxxxxx and Xxxxxx Xxxxxx 33,000
Xxxx X. X. Xxxx 1,334
Xxxxx X. Xxxxxx 33,333
Les and Xxxxx Xxxxxx 50,000
Xxxxxx X. Xxxxx and Xxxxx X. Xxxxx 20,000
TTEES UTD dated 8/21/98
Xxxxxx K. Wales 8,333
Xxxx and Xxxxxxxxx Xxxxxx 3,333
Fraser Black and Xxxxxxx Xxxxx, Tenants in Common 6,666
Xxxxxxx Partners Profit Sharing Plan 8,333
Xxxx X. Xxxxx 17,000
Xxxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx, 100,000
Tenants in Common
The Xxxxxxxxx 1980 Revocable Trust 58,333
XX Xxxxxxxxx & Co., LLC 58,333
Xxxxxxxx X. Xxxxxx 8,333
Xxxxx and Xxxx Xxxxxxxx 16,666
Xxxxxxx and Xxxxx Xxxxxx 8,333
Xxxx and Xxxxxxx Xxxx, XX 5,000
Xxxxxx X. Xxxxxx 20,000
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May 1998 Page 12
