PRIVATE STOCK AND DEBT PURCHASE AGREEMENT
("Agreement")
This Agreement is made and entered into this 9th day of February, 2001,
by and between MK Global Ventures, MK Global Ventures II and MK GVD Fund
(hereinafter referred to as "Sellers") and Xxxx Xxxx, or Assignee, (hereinafter
referred to as "Purchaser" or "Buyer");
WITNESSETH
WHEREAS, the Sellers are the record owner and holder of approximately
2,144,822 issued and outstanding shares of Common stock and 8, 483,391 issued
and outstanding shares of Preferred Stock (all series), of Hypermedia
Communications, Inc., a California corporation (hereinafter referred to as the
"Corporation" or "Company"), the shares and series of which are listed hereto on
Exhibit A (such shares hereinafter referred to as the "Stock"), and the holder
of approximately $7,914,192 in debt instruments of the Company, whether issued
or implied, the amount and terms of which are listed hereto on Exhibit B (such
debt instruments hereinafter referred to as the "Debt").
WHEREAS, the Purchaser desires to purchase said Stock and Debt and the
Sellers desires to sell said Stock and Debt, upon the terms and subject to the
conditions hereinafter set forth;
WHEREAS, Xxxxxxx Xxxxxx ("Xxxxxx"), the Chief Executive Officer of the
Company and Xxx Xxxxx ("Xxxxx"), the Chief Financial Officer of the Company have
acted as the Sellers' agents in negotiating the terms of this Agreement.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, and in order to consummate the purchase and the
sale of Stock and Debt aforementioned, it is hereby agreed as follows:
1. PURCHASE AND SALE
a. Stock and Debt - Subject to the terms and conditions hereinafter
set forth at the closing of the transaction contemplated hereby,
the Sellers shall sell, convey, transfer, and deliver to the
Purchaser "Assignments" or other acceptable documents
representing the Stock or effect an electronic transfer
representing such Stock, and the Purchaser shall purchase from
the Sellers the Corporation's Stock and Debt in consideration of
the purchase price set forth in this Agreement. If in certificate
form, the certificates representing the Corporation's Stock shall
be duly endorsed for transfer or accompanied by appropriate stock
transfer powers duly executed in blank, in either case with
signatures guaranteed in the customary fashion, and shall have
all the necessary documentary transfer stamps affixed thereto at
the expense of the Sellers. Debt assignment documents must be
acceptable to the Buyer.
b. Closing - The closing of the transaction contemplated by this
Agreement (the "Closing"), shall be held at a mutually agreed
upon location on February 9, 2001 or such other date and location
as the parties may otherwise agree.
2. AMOUNT AND PAYMENT OF PURCHASE PRICE: The total consideration and method of
payment thereof are fully set our in Exhibit C attached hereto and made a
part hereof.
3. INCORPORATION OF DOCUMENTS BY REFERENCE: The following documents (all such
documents are referred to herein as the "Incorporated Documents") filed
with the Securities and Exchange Commission are incorporated into this
Agreement by reference:
a. The Company's Annual report on Form 10-K for the year ended
December 31, 1999;
b. The Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2000;
c. The Company's current reports on Form 8-K filed on October 18,
2000 and December 20, 2000.
4. REPRESENTATIONS AND WARRANTIES OF SELLERS. Except as disclosed in
Incorporated Documents or the Disclosure Schedule attached hereto as
Exhibit D (the "Disclosure Schedule") Sellers hereby warrants and
represents:
a. Disposition Company, Stock and Debt.
i. The Sellers are not a party to any agreement, written or
oral, creating rights in respect to the Stock or Debt in or
to any third person or relating to the voting of the Stock.
ii. Sellers are the lawful owner of the Stock and Debt, free and
clear of all security interests, liens, encumbrances,
equities and other charges.
iii. Sellers confirm Buyer is purchasing 100% of Sellers'
interest in the Company. This includes any Company holdings
by an affiliate or subordinate entity of Sellers.
iv. There are no existing warrants, options, stock purchase
agreements, redemption agreements, restrictions of any
nature, calls or rights to purchase or subscribe of any
character held by Sellers relating to the Stock or Debt.
x. Xxxxxxx do not know of any liabilities of the Company except
for those liabilities disclosed in the Disclosure Schedule
and except for those liabilities arising in the ordinary
course of business of the Company.
5. REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser hereby warrants and
represents:
a. Disposition Company, Stock and Debt,
i. The Stock and Debt purchased may or may not represent a
control block of the issued and outstanding stock of the
Corporation. It is the responsibility and requirement of the
Purchaser to comply with the necessary regulatory bodies
with regard to the purchase and ownership.
ii. Stock and Debt to be purchased will be acquired for the
Purchaser's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part
thereof, the Purchaser has no present intention of selling,
granting any participation in, or otherwise distributing the
same. The
Purchaser further represents there is no contract,
undertaking, agreement or arrangement with any person to
sell, transfer, or grant participation to such person or to
any third person, with respect to any of the Stock or Debt
purchased.
iii. The Purchaser represents that it has the full power and
authority to enter into this Agreement.
iv. The Purchaser is an "accredited investor" within the meaning
of Securities and Exchange Commission ("SEC") Rule 501 of
Regulation D, as presently in effect.
v. The Purchaser will not allow the Company to commence any
bankruptcy or insolvency case or proceeding for at least one
year following the Closing.
vi. The Purchaser acknowledges that the Company has in place
certain indemnifications agreements and insurance for its
current directors and officers, and the Purchaser will not
cause the Company to terminate the indemnification
agreements or to cancel any fully paid policies of such
insurance as such agreements and insurance policies are more
fully described in the Disclosure Schedule.
6. REPRESENTATIONS AND WARRANTIES OF SELLERS AND PURCHASER. Sellers and
Purchaser respectively hereby represent and warrant that there has been no
act or omission by Sellers, Purchaser or the Corporation which would give
rise to any valid claim against any of the parties hereto for a brokerage
commission, finder's fee, or other like payment in connection with the
private transaction contemplated hereby.
7. INDEMNITY. Sellers and Purchaser respectively agree to indemnify and hold
harmless the other against any claims, losses, liabilities, damages,
deficiencies, costs and expenses, including reasonable attorneys' fees and
expenses of investigation and defense, directly and indirectly, as a result
of any breach or inaccuracy of a representation or warranty made by such
Sellers or Purchaser respectively. Purchaser further agrees to indemnify
the Sellers from and against any breach by Company of the covenants set
forth in 5(a)(v) and 5(a)(vi) above.
8. THIRD PARTY BENEFICIARIES. The Sellers and the Purchaser acknowledge that
Xxxxxx and Xxxxx are intended third party beneficiaries of the Agreement.
Further, the Sellers and the Purchaser acknowledge that Xxxxxx and Xxxxx
have all remedies provided for in California law to enforce this Agreement,
including without limitation, the right to xxx the Purchaser for breaches
of Purchaser's representations, warranties or covenants contained in this
Agreement.
9. GENERAL PROVISIONS
a. Entire Agreement - This Agreement (including the exhibits attached
hereto) constitutes the entire agreement and supercedes all prior
agreements and understandings, oral and written, between the parties
hereto with respect to the subject matter hereof.
b. Section and Other Headings. - The Section and other headings contained
in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
c. Amendments. - This Agreement may not be altered, modified or amended
except pursuant to a written instrument executed by both parties.
d. Governing Law and Dispute Resolution. - This Agreement, and all
transactions contemplated hereby, shall be governed by, construed and
enforced in accordance with the laws of the State of Texas. Any
dispute, difference or controversy arising under this Agreement and
involving the parties shall be settled by arbitration. Any arbitration
pursuant to this Agreement shall be held before a single arbitrator,
which shall be mutually selected by both parties. Should the parties
fail to agree upon an arbitrator, then an arbitrator shall be selected
by the American Arbitration Association in accordance with its
Commercial Arbitration Association's Commercial Arbitration Rules now
in force and hereafter adopted. The fees and disbursements of such
arbitrator shall be borne equally by the parties, with each party
bearing its own expenses for counsel and other out of pocket costs.
The arbitrator is specifically authorized to award costs and
attorneys' fees to the party prevailing in the arbitration and shall
do so in any case in which the arbitrator believes the arbitration was
not commenced in good faith.
IN WITNESS WHEREOF, this Agreement has been executed by each of the
individual parties hereto on the date first above written.
FOR SELLERS:
MK Global Ventures
/s/ Xxxxxxx X. Xxxxxxx Date: February 9, 2001
--------------------------------
Print Name: Xxxxxxx X. Xxxxxxx
XX Global Ventures II
/s/ Xxxxxxx X. Xxxxxxx Date: February 9, 2001
--------------------------------
Print Name: Xxxxxxx X. Xxxxxxx
XX GVD Fund
/s/ Xxxxxxx X. Xxxxxxx Date: February 9, 2001
--------------------------------
Print Name: Xxxxxxx X. Xxxxxxx
FOR BUYER:
/s/ Xxxx Xxxx Date: 9 Feb 01
--------------------------------
Print Name: Xxxx Xxxx
EXHIBIT "A"
COMPANY STOCK HELD BY THE SELLERS
COMMON STOCK 2,144,822
PREFERRED STOCK
SERIES E 8,064,516
SERIES F 82,250
SERIES G 50,344
SERIES H 177,000
SERIES J 169,281
-------
8,483,391
WARRANTS
1,724 shares priced at $2.25 per share with an expiration dated of June 2002
EXHIBIT "B"
COMPANY DEBT HELD BY THE SELLERS
Promissory Notes
Amount Date
------ ----
$ 350,000 September 14, 2000
350,000 August 2, 2000
175,000 July 31, 2000
175,000 July 14, 2000
2,616,689 June 30, 2000
200,000 June 30, 2000
200,000 June 15, 2000
150,000 May 31, 2000
250,000 May 15, 2000
250,000 April 28, 2000
300,000 April 14, 2000
1,597,502 March 31, 2000
300,000 March 29, 2000
200,000 March 14, 2000
300,000 February 15, 2000
300,000 February 8, 2000
200,000 January 18, 2000
---------
$7,914,191
Accrued Interest
At December 31, 2000 $642,379
EXHIBIT "C"
CONSIDERATION
AND
PAYMENT OF PURCHASE PRICE
1.) CONSIDERATION
(a) As consideration for the purchase and sale of the Sellers'
Stock and Debt of Hypermedia Communications, Inc., pursuant to
Private Stock and Debt Purchase Agreement, the Purchaser shall
pay to the Sellers the sum of Seventy-Six Thousand One Hundred
Seventy-Two dollars ($76,172.00) USA. Such cash consideration
to be referred to in this Agreement as the "Cash Purchase
Price".
2.) PAYMENT
Total Purchase Price shall be paid and delivered as follows:
Sixty-Six Thousand One Hundred and Seventy Two Dollars USA
($66,172.00) of the Total Purchase Price to the Sellers at the Closing;
Five Thousand Dollars USA ($5,000.00) of the Total Purchase Price to
Xxxxxxx Xxxxxx at the Closing; and
Five Thousand Dollars USA ($5,000.00) of the Total Purchase Price to
Xxx Xxxxx at the Closing.
3.) WIRE INSTRUCTIONS
The wire instructions for the Total Purchase Price are as follows:
Wire Instructions for Sellers
Imperial Bank
San Jose, CA
Routing #000000000
Account #0000-000-000
Wire instructions for Xxxxxxx Xxxxxx
Patelco Credit Union
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Routing # 000000000
Account # 113841-11
EXHIBIT "C"
(CONTINUED)
Wire Instructions for Xxx Xxxxx
Patelco Credit Union
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Routing # 000000000
Account # 115922-10
EXHIBIT "D"
DISCLOSURE SCHEDULE
Assumed Liabilities
Dell Computer Lease
Above Net $41,496
Ikon/ICS 37,928
401(k) Plan
401(k) plan was determined in December without getting a formal IRS
determination letter. Assets are being distributed in February 2001. Company
will have administrative responsibilities for filing final plans returns. Fox
and Fox has been paid to complete the 2000 and 2001 returns.
Indemnification Agreements
Xxxxxxx Xxxxxxx
Xxxx Xxxxxx
Xxxx Xxxxxx
Xxxxxxx Xxxxxx
Xxx Xxxxx
Insurances Policies
Magazine Publishers Liability
National Casualty Company
#LA014891
Directors & Officers Liability
Executive Risk Indemnity
#8166-0470
Employment Practice Liability
Executive Risk Indemnity
#8166-0470
Corporate Fiduciary Liability
Legion Insurance
#LF40625804
Commercial Property/Liability
Federal Insurance
#(00) 0000-00-00
