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EXHIBIT 10.1
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (this "Agreement"), dated
October 2, 1995, is between INTREPID FOOD HOLDINGS, INC., a Delaware
corporation (the "Company"), Frontenac VI Limited Partnership ("Purchaser"),
and Xxxxxxx X. Xxxx ("Founder").
RECITALS
A. Founder and Purchaser are organizing the Company to
identify, investigate and pursue acquisition opportunities in the food
industry, and to develop related business plans and strategies.
B. In order to provide funding for the initial
activities of the Company, Founder and Purchaser desire to purchase shares of
Common Stock of the Company pursuant to the terms and conditions hereof.
AGREEMENTS
In consideration of the promises and the respective
agreements, covenants, representations and warranties contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
SALE AND PURCHASE OF COMMON STOCK
1.1 SALE AND PURCHASE OF COMMON STOCK. Upon the terms and subject
to the satisfaction of the conditions set forth herein, and in reliance upon
the respective representations and warranties of the parties set forth herein,
the Company hereby agrees to sell to Purchaser and Founder, and Purchaser and
Founder hereby agree to purchase from the Company, at the Closing (as defined
herein), 4,500 and 500 shares, respectively, of Common Stock, par value $.001
per share (the "Common Stock"), of the Company, in exchange for the payment of
$100.00 per share.
1.2 CLOSING. The closing of the purchase and sale of the shares
of Common Stock hereunder (the "Closing") will take place at the offices of
Xxxxxxx & Xxxxxx, Three First Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx on
the date hereof or at such other time, date and place as shall be mutually
agreed by the Company, the Purchaser and the Founder. At the Closing:
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(a) the Company will deliver to Purchaser and Founder a
certificate for the number of shares of Common Sock purchased by such
person duly executed and registered in the name of such person; and
(b) Purchaser and Founder will deliver to the Company by
certified, cashier's or personal check or wire transfer, a payment
equal to the purchase price of such shares.
ARTICLE II
CONDITIONS TO CLOSING
The obligation of Purchaser and Founder to purchase shares of Common
Stock at the Closing is subject to the fulfillment to its satisfaction of each
of the following conditions:
2.1 REPRESENTATIONS AND WARRANTIES CORRECT. The representations
and warranties made by the Company in Article III shall be true and correct
when made, and shall be true and correct as of the Closing as if made at the
Closing.
2.2 PERFORMANCE. All covenants, agreements and conditions
contained in this Agreement to be performed or complied with by the Company at
or prior to the Closing shall have been performed or complied with.
2.3 SECRETARY'S CERTIFICATE. At the Closing, the Company shall
have delivered to Purchaser and Founder correct and complete copies of each of
the following, in each case certified to be in full force and effect on the
date of the Closing by the Secretary of the Company:
(i) the By-Laws of the Company; and
(ii) resolutions of the Board of Directors of the Company
authorizing the execution, delivery and performance of this Agreement and the
transactions contemplated hereby and thereby.
2.4 CERTIFICATE OF INCORPORATION. At the Closing, the Company
shall have delivered to Purchaser and Founder the Certificate of Incorporation
of the Company certified by the Secretary of State of the State of Delaware as
of a date not more than 15 days prior to the date of the Closing.
2.5 EMPLOYMENT AGREEMENT. The Founder and the Company shall have
executed and delivered an Employment Agreement in the form of Exhibit A
attached hereto (the "Employment Agreement").
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As a material inducement to Purchaser and Founder to enter into the
transactions contemplated by this Agreement, the Company represents and
warrants to Purchaser and Founder as follows:
3.1 ORGANIZATION AND QUALIFICATION. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware.
3.2 CORPORATE POWER. The Company has all requisite corporate
power and authority and all licenses, permits and authorizations necessary to
own and operate its properties, to carry on its business as now conducted and
to execute, deliver and perform this Agreement and to issue shares of Common
Stock to be issued hereunder, and to execute, deliver and perform all other
instruments, documents and agreements contemplated or required by the
provisions of this Agreement to be executed, delivered or performed by the
Company.
3.3 AUTHORIZATION OF TRANSACTION. The execution, delivery and
performance by the Company of this Agreement and the transactions contemplated
hereby (i) have been duly authorized by all necessary corporate action of the
Company, its officers, directors and stockholders and (ii) will not violate,
conflict with, result in any breach of any of the terms, conditions or
provisions of, constitute (with or without the passage of time or giving of
notice or both) a default under, or result in the creation of any lien or
encumbrance upon any property of the Company under the provisions of any law,
rule, regulation, judgment, writ, injunction, order, decree, agreement,
certificate of incorporation, by-law or other instrument to which the Company
is a party or by which the Company or any property of the Company may be bound.
3.4 BINDING OBLIGATION; VALID ISSUANCE. This Agreement has been
duly executed by the Company and constitutes a valid and legally binding
obligation of the Company, enforceable in accordance with its terms except as
the enforceability may be limited by bankruptcy, insolvency or other similar
laws of general application affecting the enforcement of creditors' rights or
by general principles of equity.
3.5 CAPITALIZATION. The Company's authorized capital stock
consists of 12,000 shares of Common Stock and 14,000 shares of Series A
Preferred Stock. The only shares of Common Stock issued and outstanding.
reserved for issuance or committed to be issued are the shares of Common Stock
to be issued pursuant to this Agreement. There are no shares of Series A
Preferred Stock issued and outstanding, reserved for issuance or committed to
be issued. Except as otherwise provided herein, there are no outstanding
preemptive, conversion or other rights, options, warrants or agreements granted
or issued by or binding upon the Company for the purchase or acquisition of any
shares of its capital stock or obligations to issue or grant any of the
foregoing or any outstanding capital appreciation, profit participation or
similar rights with respect to the Company or obligations to issue or grant any
such rights. The Company owns no equity or equity-like interest (whether
stock, partnership interest or equity appreciation rights) in any other entity.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF PURCHASER AND FOUNDER
Each of Purchaser and Founder hereby represents and warrants to the
other parties for this Agreement with respect to itself or himself that:
(a) such person is acquiring the shares of Common
Stock for Investment and not with a view to distributing all or any
part thereof in any transaction which would constitute a
"distribution" within the meaning of the Securities Act of 1933, as
amended (the "Securities Act");
(b) such person acknowledges that the shares of
Common Stock have not been registered under the Securities Act of
1933, as amended, or any state securities law, and the Company is
under no obligation to file a registration statement with the
Securities and Exchange Commission or any state securities commission
with respect to the shares of Common Stock;
(c) such person has such knowledge and experience
in financial and business matters that he is capable of evaluating the
merits and risks of his investment in the shares of Common Stock;
(d) such person is able to bear the complete loss
of its or his investment in the shares of Common Stock (and with
respect to Purchaser, is not an entity formed solely to make this
investment); and
(e) such person has had the opportunity to ask
questions of, and receive answers from, the Company and its management
concerning the shares of Common Stock, and to obtain additional
information.
ARTICLE V
COVENANTS
5.1 GENERAL. (a) Until the consummation by the Company of its
first acquisition of a business in the food industry, except with the prior
approval of the Board of Directors of the Company, the Company shall not engage
in any activity other than (i) identifying, investigating and pursuing
acquisition opportunities in the food industry (but not including (a) the
execution of definitive agreements relating to acquisition opportunities or (b)
the consummation of acquisition opportunities), and developing related business
plans and strategies and (ii) developing and refining the business plan for the
Company. Without limiting the generality of the foregoing, except with the
prior approval of the Board of Directors of the Company, the
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Company shall not: (A) authorize or issue, or obligate itself by agreement or
otherwise to issue, any capital stock; (B) directly or indirectly declare or
pay a dividend or make other distributions with respect to any of its capital
stock; (C) except as permitted by the Employment Agreement, directly or
indirectly redeem, purchase or otherwise acquire any of the Company's capital
stock; (D) liquidate, dissolve or effect a recapitalization or reorganization
in any form of transaction; (E) create, incur, assume or suffer to exist any
liens or indebtedness); (F) merge or consolidate with any person or entity; (G)
sell, lease, license or otherwise dispose of all or substantially all its
assets; (H) establish or acquire any subsidiary; (I) acquire any equity or
equity-like interest (whether capital stock, partnership or membership interest
or equity appreciation right); (J) incur or make, or become obligated to incur
or make, any capital expenditures greater than $5,000; (K) make any amendment
to the Company's certificate of incorporation or bylaws, or file any resolution
of the Board of Directors with the Delaware Secretary of State; or (L) acquire
any business by any means.
(b) It is anticipated that, subject in all respects to the terms
and conditions outlined in Exhibit B attached hereto, further investments may
be made in the Company by Purchaser and Founder as outlined in Exhibit B
attached hereto to provide all or a portion of the financing which may be
necessary to acquire controlling interests in acquisition targets in the food
industry identified by the Company, which targets must be acceptable to
Purchaser and Founder, and which acquisitions must be made pursuant to
definitive documents acceptable to Purchaser and Founder. Any additional
investment in the Company to be made by Purchaser and Founder would be subject
in all respects to the execution and delivery of definitive documents
acceptable to Purchaser and Founder.
(c) Purchaser agrees that, from the date hereof until the date
that is eighteen months from the date hereof, Purchaser shall not capitalize
any entity formed to provide financing support for a food industry executive to
identify, investigate and pursue acquisition opportunities in the food
industry.
(d) For a period of 18 months after the date hereof, so long as
Founder is the Chief Executive Officer of the Company, Purchaser shall
reasonably promote the interests of the Company and shall use reasonable
efforts, as determined in its business judgment, to refer appropriate
acquisition possibilities that are brought to its attention to the Company.
(e) On or after September 29, 1996, so long as Founder is Chief
Executive Officer of the Company and the Company has not consummated its first
acquisition of a business in the food industry, Founder from time to time can
deliver an Additional Financing Notice (as hereinafter defined) to Purchaser.
An "Additional Financing Notice" is a notice executed by Founder specifying (i)
that additional financing for the Company is reasonably required to continue
the process of identifying, investigating and pursuing acquisition
opportunities in the food industry, (ii) the amount of such additional
financing requested (which is subject to the limit set forth in this
Agreement), (iii) a reasonably detailed budget for the use of the proceeds of
such additional financing which is consistent with the terms of this Agreement,
including a projection of the time frame in which such proceeds are expected to
be expended (which time frame shall not extend beyond March 31, 1997) and (iv)
that Founder will purchase additional shares of Common Stock of the Company at
a purchase price of $100.00 per share in an amount equal to 10% of the
additional financing requested. The maximum aggregate amount of additional
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financing obtainable pursuant to any and all Additional Financing Notices shall
be $250,000. If an Additional Financing Notice is reasonably acceptable to
Purchaser, a closing shall be held at a mutually agreeable time and place no
later than fifteen days after delivery of such Additional Financing Notice. At
such closing the Company will issue shares of Common Stock, and deliver
certificates therefor to each of Purchaser and Founder, in exchange for the
payment of $100.00 per share (i) to Purchaser who will purchase that number of
shares of Common Stock equal to the remainder of (a) 90% of the additional
financing requested in the Additional Financing Notice divided by (b) $100 and
(ii) to Founder who will purchase that number of shares of Common Stock equal
to the remainder of (a) 10% of the additional financing requested in the
Additional Financing Notice divided by (b) $100.
5.2 USE OF PROCEEDS. The Company shall use the proceeds from the
sale of Common Stock hereunder solely to pay (i) its obligations under the
Employment Agreement, (ii) its obligations under Section 6.9 hereof, and (iii)
for working capital purposes in connection with the activities permitted by
Section 5.1 hereof pursuant to a budget approved by the Board of Directors of
the Company.
5.3 BOARD OF DIRECTORS.
(a) Each of Purchaser and Founder agrees to take all action
necessary including, but not limited to, the voting of their shares of stock of
the Company, the execution of written consents, the calling of special
meetings, the removal of directors, the filling of vacancies on the Board of
Directors of the Company and each subsidiary of the Company, the waiving of
notice and the attending of meetings, so as to cause (i) the number of members
of the Board of Directors of the Company and each subsidiary of the Company to
be three prior to the consummation by the Company of its first acquisition of a
business in the food industry (and no more than seven members thereafter) and
(ii) the Board of Directors of the Company and each subsidiary of the Company
to be at all times comprised of the following persons:
(A) Founder (so long as Founder is employed by the Company);
(B) two persons designated by the Purchaser and who continue to be
acceptable to the Purchaser; and
(C) after the consummation by the Company of its first acquisition
of a business in the food industry, up to four persons with
substantial knowledge of the food industry, none of whom is an
employee or officer of the Company or any of its subsidiaries,
designated by the Purchaser and who continue to be acceptable
to the Purchaser (each such person is referred to herein as an
"Outside Director");
(b) After the consummation by the Company of its first acquisition
of a business in the food industry, each of Purchaser and Founder agrees to
take all actions necessary including, but not limited to, the voting of their
shares of stock of the Company and each subsidiary of the Company, the
execution of written consents, the calling of special meetings, the removal of
directors, the filling of vacancies on the Board of Directors of the Company
and each subsidiary of the Company, the waiving of notice and the attending of
meetings, to cause the Board of Directors of the Company and each subsidiary of
the Company to establish a compensation
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committee which shall include the persons designated and acceptable pursuant to
Section 5.3(a)(ii)(B) and one Outside Director to set compensation of the
management of the Company and each subsidiary of the Company.
(c) Each of Purchaser and Founder agrees to take all actions
necessary including, but not limited to, the voting of their shares of stock of
the Company and each subsidiary of the Company, the execution of written
consents, the calling of special meetings, the removal of directors, the
filling of vacancies on the Board of Directors of the Company and each
subsidiary of the Company, the waiving of notice and the attending of meetings,
so as to cause each committee of the Board of Directors of the Corporation and
each subsidiary of the Company to include at least the persons designated and
acceptable pursuant to Section 5.3(a)(ii)(B).
(d) Founder shall resign from the Board of Directors of the
Company and each subsidiary of the Company, and each committee thereof, upon
the termination of Founder's employment with the Company.
(e) The Company shall hold meetings of its Board of Directors
periodically but not less often than quarterly.
5.4 RIGHT OF FIRST REFUSAL - NEW SECURITIES.
(a) Each of Purchaser and Founder shall have the right of first
refusal to purchase its or his proportionate number, or any lesser number, of
any New Securities which the Company may, from time to time, propose to sell
and issue. For purposes of this Section 5.4, each such holder's "proportionate
number" means the product obtained by multiplying the number of New Securities
(as hereinafter defined) proposed to be sold and issued by a fraction, the
numerator of which will be the number of shares of Common Stock owned by such
holder and the denominator of which will be the total number of shares of
Common Stock owned by all holders of Common Stock.
(b) In the event the Company proposes to undertake an issuance of
New Securities, it will give each of Purchaser and Founder written notice of
its intention to do so, describing the New Securities and the price and terms
upon which the Company proposes to issue the same, and setting forth the number
of shares which such holder is entitled to purchase and the aggregate purchase
price therefor. Each such holder will have 15 days from the date of receipt of
any notice to agree to purchase up to its or his proportionate number of such
New Securities, for the price and upon the terms specified in the notice by
giving written notice to the Company and stating therein the quantity of New
Securities to be purchased.
(c) In the event any Purchaser or Founder fails to exercise such
right of first refusal within said 15-day period the Company will have 120 days
thereafter to sell the New Securities as to which such holder's right was not
exercised, at a price and upon such other terms no more favorable to the
purchasers thereof than those specified in the Company's notice. In the event
the Company has not sold such New Securities within said 120-day period, the
Company will not thereafter issue or sell any New Securities without first
offering such New Securities to Purchaser and Founder in the manner provided
above.
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(d) "New Securities" means (i) any capital stock of the Company or
any other securities or other obligations of the Company, including any equity,
profit participation or capital appreciation rights, or phantom stock, whether
now authorized or not, (ii) any rights, options, or warrants to purchase any
such capital stock or rights, or to purchase any securities of any type
whatsoever that are, or may become, convertible into any such capital stock,
and (iii) any securities of any type whatsoever that are, or may become
convertible into any such capital stock; provided, however, that "New
Securities" will not include (A) securities offered to the public pursuant to a
registration statement under the Securities Act, (B) options or securities
issued to, or securities issued upon exercise of options issued to, officers,
directors or employees of the Company or a subsidiary of the Company pursuant
to a stock option or purchase plan or other employee stock incentive program or
agreement approved by the Board of Directors of the Company or a subsidiary of
the Company, and (C) securities issued in connection with the acquisition of a
business or another entity by the Company or a subsidiary of the Company by any
means, including by merger, purchase of all or substantially all of such other
entity's assets or capital stock, or by other reorganization.
5.5 LIMITATIONS ON TRANSFERS BY FOUNDER.
(a) Founder agrees that he shall not sell, assign, pledge,
transfer or otherwise dispose of (each such act being referred to herein as a
"Transfer") any of his Management Securities (as defined in the Employment
Agreement), except as follows:
(i) with respect to any or all such Management
Securities, pursuant to the provisions of Section 5.6 hereof;
(ii) with respect to any or all such Management
Securities, pursuant to the "Drag-Along" provisions of Section 5.8
hereof;
(iii) with respect to any or all such Management
Securities, pursuant to the "Tag-Along" provisions of Section 5.9
hereof; or
(iv) with respect to any or all such Management
Securities, as otherwise consented to by Company in its sole
discretion; provided that, unless otherwise consented to by Purchaser
in its sole discretion, such shares when Transferred shall remain
subject to this Section 5.5, Section 5.8 and Section 5.10 of this
Agreement and Section 6 of the Employment Agreement, and the
transferee shall be or thereupon become bound by such Sections of this
Agreement and Section 6 of the Employment Agreement as if such
Transferee were Founder.
(b) In the event that Founder proposes to Transfer any Management
Securities in any transaction or series of related transactions pursuant to
Section 5.5(a)(iv), then at least 30 days prior to the proposed Transfer,
Founder shall notify Company and Purchaser of such proposed transactions,
setting forth the information that Purchaser would be required to set forth in
a Sale Notice pursuant to Section 5.7.
(c) Notwithstanding anything to the contrary in this Section 5.5,
Company shall not register (or permit any transfer agent to register) any
Transfer of Management Securities
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otherwise permitted hereby where an acknowledgment that the proposed transferee
is bound by certain terms of this Agreement is appropriate unless and until
such acknowledgment is delivered in a form and substance satisfactory to
Company.
5.6 PERMITTED TRANSFERS. Founder may transfer Management
Securities to Permitted Transferees (a) who consent in a writing delivered to
the Company to be bound by the terms of Section 5.5, 5.8 and 5.10 of this
Agreement and Section 6 of the Employment Agreement as if such Transferee were
Founder and (b) who grant Founder an irrevocable power of attorney or proxy to
vote, or execute written consents or waivers with respect to, any such
Management Securities in any vote of the stockholders of the Company or with
respect to any other action of such stockholders. "Permitted Transferees"
means the spouse or lineal descendants of Founder, any trust for the benefit of
Founder or the benefit of the spouse or lineal descendants of Founder, any
corporation or partnership in which Founder, the spouse and the lineal
descendants of Founder are the direct and beneficial owners of all of the
equity interests (provided Founder, the spouse and lineal descendants of
Founder agree in writing to remain the direct and beneficial owners of all such
equity interests), and the personal representative of Founder upon Founder's
death for purposes of administration of Founder's estate or upon Founder's
incompetency for purposes of the protection and management of the assets of
Founder.
5.7 SALE NOTICE. In the event that Purchaser proposes to make a
Disposition (as hereinafter defined) of any shares of Common Stock, Purchaser
shall promptly notify (the "Sale Notice") Company and Founder of such proposed
Disposition in writing, setting forth:
(a) the number of shares of Common Stock proposed to be
disposed of by Purchaser (the "Offered Common Shares"); and
(b) the price per share at which Purchaser intends to
dispose of the Offered Common Shares (the "Offered Common Price") and
the identity of the proposed purchaser or purchasers, as well as the
other material terms and conditions of the proposed Disposition (the
"Offered Terms").
"Disposition" means a sale, transfer or other disposition of shares of Common
Stock, including by means of a merger or consolidation of Company with or into
any other person, but shall not include a distribution of shares to the
partners of Purchaser.
5.8 DRAG-ALONG RIGHT.
(a) In connection with the proposed transaction set forth in a
Sale Notice, Purchaser shall have the right (the "Drag-Along Right") to require
Founder to sell to the proposed purchaser or purchasers on the Offered Terms
for the Offered Common Price, that number of shares of Common Stock (or if such
number is not an integral number, the next integral number which is greater
than such number) which shall be the product of (i) the total number of shares
of Common Stock then owned by Founder and (ii) a fraction, the numerator of
which shall be the number of Offered Common Shares, and the denominator of
which shall be the total number of shares of Common Stock then owned by
Purchaser; provided that, if Purchaser is proposing to make a Disposition of
all shares of Common Stock then owned by Purchaser, then Purchaser
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shall have the right to require Founder to sell to such proposed purchaser or
purchasers all shares of Common Stock then owned by Founder. To exercise the
Drag-Along Right, the Purchaser shall provide Founder with a notice (the
"Drag-Along Notice"), at least 10 days prior to consummation of the proposed
transaction, of its exercise of the Drag-Along Right, accompanied by the Sale
Notice required by Section 5.7. Upon the receipt of such Drag-Along Notice,
Founder shall be obligated to sell the number of shares of Common Stock subject
to the Drag-Along Right as determined above in connection with such proposed
transaction, and Founder shall promptly take all steps described in the
Drag-Along Notice and otherwise reasonably requested by Purchaser to effectuate
the Disposition of the shares of Common Stock covered thereby, including, but
not limited to, the furnishing of information customarily provided in
connection with such a sale and the execution of such sales and other transfer
documents with such representations, warranties, agreements, covenants and
indemnities as may be required by the Offered Terms. All references to "sell"
herein shall be deemed to include transfer, dispose of or otherwise convey in
the manner in which such Disposition is proposed to be made.
(b) At the closing of the proposed transaction (which date, place
and time shall be designated by Purchaser in writing at least two business days
prior thereto), Founder shall deliver certificates evidencing all its shares of
Common Stock subject to the Drag-Along Right, duly endorsed, or accompanied by
written instruments of transfer in form satisfactory to the proposed purchaser
or purchasers, duly executed, by Founder free and clear of any liens, claims or
encumbrances.
5.9 TAG-ALONG RIGHT.
(a) In connection with a proposed transaction set forth in a Sale
Notice in which the Purchaser shall not have exercised its Drag-Along Right,
Founder shall have the right but not the obligation (the "Tag-Along Right") to
sell to the proposed purchaser or purchasers on the Offered Terms for the
Offered Common Price that number of shares of Common Stock (or if such number
is not an integral number, the next integral number which is greater than such
number) which shall be the product of (i) the total number of shares of Common
Stock owned by Founder and (ii) a fraction, the numerator of which shall be the
number of Offered Common Shares and the denominator of which shall be the total
number of shares of Common Stock then owned by Purchaser. The shares of Common
Stock to be sold hereunder shall be sold on the same terms and conditions as
those applicable to the Purchaser specified in the Sale Notice, including the
time of sale, form of consideration and per-share price. Founder's failure to
exercise rights under this Section 5.9(a) shall result in exclusion from sale
in the transaction specified in the Sale Notice. If Founder desires to
exercise its rights under this Section 5.9(a), Founder shall give written
notice thereof to Purchaser no later than five (5) days after receipt of the
Sale Notice. Founder shall promptly take all steps described in the Sale
Notice to effectuate the sale of the shares of Common Stock covered thereby,
including, but not limited to, the furnishing of information customarily
provided in connection with such a sale and the execution of such sales and
other transfer documents with such representations, warranties, agreements,
covenants and indemnities as may be required by the Offered Terms. All
references to "sell" herein shall be deemed to include transfer, dispose of or
otherwise convey in the manner in which such Disposition is proposed to be
made.
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(b) If the sum of (i) the Offered Common Shares and (ii) shares of
Common Stock offered for sale pursuant to the exercise of the Tag-Along Right
pursuant to Section 5.9(a) exceeds the number of shares of Common Stock that
the purchaser or purchasers described in the Sale Notice is willing to buy,
Purchaser shall have the right to adjust the number of shares of Common Stock
to be sold by each of Purchaser and Founder to ensure that the ratio of the
number of Common Stock proposed to be sold by each such holder to the number of
shares of Common Stock owned by such holder shall be equal for each of
Purchaser and Founder.
(c) The Tag-Along Right provisions of Section 5.9(a) shall be
exercisable only by Founder with respect to Management Securities owned by
Founder. The Tag-Along Right provisions of Section 5.9(a) shall not apply to
(i) any Disposition of shares of Common Stock by Purchaser to the partners of
Purchaser and (ii) any sales by any person or persons (including the partners
of Purchaser) other than sales by Purchaser.
5.10 SALE OF COMPANY. The parties hereto agree that at any time
after October 2, 2003, upon the written request of either Founder (so long as
he is Chief Executive Officer of Company) or Purchaser, the parties shall use
reasonable efforts to sell (i) all of the capital stock of the Company or (ii)
all or substantially all of the assets (and promptly distribute to holders of
Common Stock the proceeds available for distribution with respect to the Common
Stock after all other appropriate distributions, including distributions to the
holders of preferred stock of Company with respect to preferred stock of
Company), in either case, to a third party or parties not affiliated with
either Founder or Purchaser at the highest price and on the most favorable
terms to Founder and Purchaser then obtainable. Any such transaction involving
a sale of Common Stock shall be at the same price per share for all holders of
Common Stock as the price per share to be obtained by Purchaser, provided,
however, that in any such sale the preferred stock of Company shall first be
paid the full preferential amounts such preferred stock would be entitled to
receive in a liquidation of the Company (but no more than such amount). The
parties hereto shall reasonably cooperate with another in connection with their
obligations under this Section 5.10 and shall take such steps and execute such
documents and instruments as are reasonable or appropriate to consummate the
sale contemplated hereby on the terms provided for herein.
5.11 LEGEND ON SHARES. (a) Founder and Purchaser agree that the
following legend (or a legend to substantially the following effect) will be
affixed to all certificates evidencing all Management Securities:
"The securities evidenced by this certificate may not be sold,
pledged, hypothecated or otherwise transferred unless such sale,
pledge, hypothecation or other transfer complies with the provisions
of the Common Stock Purchase Agreement among Intrepid Food Holdings,
Inc. (the "Company"), Frontenac VI Limited Partnership and Xxxxxxx X.
Xxxx, a copy of which is on file with the Secretary of the Company."
(b) Founder and Purchaser agree that the following legend (or a
legend to substantially the following effect) will be affixed to all
certificate evidencing shares of Common Stock:
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"These securities have not been registered under the Securities Act of
1933. They may not be sold or offered for sale in the absence of an
effective registration statement as to the securities under that Act,
or an opinion from counsel satisfactory to Intrepid Food Holdings,
Inc. that such registration is not required."
Company shall, upon the written request of any holder accompanied by an opinion
of counsel (reasonably satisfactory in form and substance to Company) to the
effect that such holder's shares may be sold without registration or
qualification under relevant federal and state securities laws, issue
certificates evidencing such shares without the legend affixed in exchange for
legended certificates.
5.12 FEES. So long as Purchaser is a stockholder of Company,
Frontenac Company shall be paid a cash fee at the closing of each acquisition
by Company equal to 1.5% of the purchase price paid by Company (or a subsidiary
of Company) in such acquisition. At the end of each fiscal year of Company,
Frontenac Company shall be paid a cash fee equal to $50,000 for each seat on
the Board of Directors of the Company which was held by a partner of Frontenac
Company for all or a portion of such fiscal year.
ARTICLE VI
MISCELLANEOUS
6.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein, or made pursuant hereto, will
survive the execution and delivery of this Agreement.
6.2 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law and to carry out the intent of the parties, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law,
such provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provisions or the
remaining provisions of this Agreement.
6.3 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered will be deemed an
original, and such counterparts taken together will constitute one and the same
agreement.
6.4 DESCRIPTIVE HEADINGS. The descriptive headings of this
Agreement are inserted for convenience of reference only and do not constitute
a part of this Agreement.
6.5 INTERPRETATION OF AGREEMENT. Neither this Agreement, nor any
other agreement, document or instrument referred to herein or executed and
delivered in connection herewith, shall be construed against any party as the
principal draftsperson hereof or thereof.
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6.6 GOVERNING LAW. All questions concerning the construction,
validity and interpretation of, and performance of the obligations imposed by,
this Agreement shall be governed by and construed in accordance with the
internal laws of the State of Illinois applicable to contracts made and wholly
to be performed in that state.
6.7 WAIVERS AND AMENDMENTS. Except as otherwise expressly
provided herein or therein, the provisions of this Agreement may be amended
only by the written agreement of the Company, Purchaser and Founder.
6.8 SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, all covenants and agreements contained in this Agreement by or
on behalf of any of the parties hereto will bind and inure to the benefit of
the respective successors and assigns of the parties hereto, whether so
expressed or not.
6.9 FEES AND EXPENSES.
(a) The Company shall bear all of its own expenses in connection
with this Agreement.
(b) The Company shall pay all expenses incurred by the Purchaser
(including the legal fees and disbursements of Xxxxxxx & Xxxxxx) in connection
with the negotiation, preparation, execution and delivery of the documents
contemplated hereby (including, but not limited to, this Agreement and the
Employment Agreement) and the transactions contemplated hereby.
(c) The Company shall pay all expenses incurred by founder
(including the legal fees and disbursements of his counsel) in connection with
the negotiation of the documents contemplated hereby (including, but not
limited to, this Agreement and the Employment Agreement).
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6.10 NOTICES. Any notices required, permitted or desired, to be
given hereunder shall be delivered personally, sent by overnight courier or
mailed, registered or certified mail, return receipt requested, to the
following addresses, and shall be deemed to have been received on the day of
personal delivery, one business day after deposit with an overnight courier or
three business days after deposit in the mail:
If to the Company, to:
Intrepid Food Holdings, Inc.
c/o Frontenac Company
000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
If to Purchaser or Founder, to the address set forth below such
person's name on the signature page hereto.
or to such other address or such other person or entity as any party may
specify in a written notice given to the other parties hereto.
[Remainder of Page Intentionally Left Blank.
Signature page follows.]
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The parties hereto have executed and delivered this Agreement as of
the date first set forth above.
INTREPID FOOD HOLDINGS, INC.,
a Delaware corporation
By: /S/ X.X. XxXxxxx
---------------------------------
Its: Vice President
PURCHASER:
FRONTENAC VI LIMITED PARTNERSHIP
By: Frontenac Company
Its: General Partner
By: /S/ X.X. XxXxxxx
---------------------------------
a partner
Address: 000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
FOUNDER:
/S/ Xxxxxxx X. Xxxx
---------------------------------
Xxxxxxx X. Xxxx
Address: 000 Xxxxx Xxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
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