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EXHIBIT 10.33
RESTORATION HARDWARE, INC.
STOCK PURCHASE AGREEMENT
AGREEMENT made this 18th day of March, 2001, by and between
Restoration Hardware, Inc., a Delaware corporation, and Xxxx X. Xxxxxxxx
("Employee").
All capitalized terms in this Agreement shall have the meaning
assigned to them in this Agreement or in the attached Appendix.
A. PURCHASE OF SHARES
1. PURCHASE. Employee hereby purchases 571,429 shares of Common
Stock (the "Purchased Shares") at the purchase price of $1.75 per share, subject
to Paragraph A.2. (the "Purchase Price"), and the Corporation hereby sells the
Purchased Shares to Employee at the Purchase Price.
2. PAYMENT. Concurrently with the delivery of this Agreement to
the Corporation, Employee shall pay the Purchase Price for the Purchased Shares
as follows: Employee shall deliver in cash or by check an amount equal to $1,290
and shall deposit $998,710.70 into escrow ("Escrow") pursuant to the escrow
agreement ("Escrow Agreement") attached hereto as Exhibit A. The Corporation
shall have no rights to the amounts deposited in the Escrow unless and until the
third party financing ("Financing") referred to in the Escrow Agreement closes
on or before March 30, 2001.
3. STOCKHOLDER RIGHTS. Employee (or any successor in interest)
shall have all the rights of a stockholder (including voting, dividend and
liquidation rights) with respect to the Purchased Shares. However, the
certificates representing such shares shall be retained by the Corporation and
the Purchased Shares may not be transferred (other than by will or the laws of
descent and distribution following death) until such shares are no longer
potentially subject to the automatic repurchase right described in Paragraph 4
below.
4. AUTOMATIC REPURCHASE. If the Corporation does not close the
Financing on or before March 30, 2001, the Purchased Shares shall automatically
and immediately be repurchased by the Corporation for the Purchase Price. The
Corporation's obligation to repay the Purchase Price to Employee shall be
satisfied by (i) the payment by the Corporation to Employee of the amount paid
directly to the Corporation in cash or by check and (ii) the return to Employee
from the Escrow of the amount to which he is entitled thereunder.
5. REPRESENTATIONS AND WARRANTIES. Employee hereby makes, with
respect to the purchase of the Purchased Shares, the same investment
representation and warranties as are required to be made by investors pursuant
to the Series A and B Preferred Stock Purchase Agreement (the "Preferred
Agreement") applicable to the purchase of preferred stock of the Corporation
scheduled to occur substantially contemporaneously with the purchase of the
Purchased Shares. Similarly, the Corporation hereby makes, with respect to the
purchase of the
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Purchased Shares, the same representations and warranties that it is required to
make under Sections 4.4 and 4.5 of the Preferred Agreement.
B. GENERAL PROVISIONS
1. NO EMPLOYMENT OR SERVICE CONTRACT. Nothing in this Agreement
shall confer upon Employee any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining Employee)
or of Employee, which rights are hereby expressly reserved by each, to terminate
Employee's Service at any time for any reason, with or without cause; provided
that nothing herein shall diminish Employee's rights to severance and other
benefits to the extent and under the circumstances provided in his Compensation
and Severance Agreement.
2. EMPLOYEE UNDERTAKING. Employee hereby agrees to take whatever
additional action and execute whatever additional documents the Corporation may
deem necessary or advisable in order to carry out or effect one or more of the
obligations or restrictions imposed on either Employee or the Purchased Shares
pursuant to the provisions of this Agreement.
3. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
4. SUCCESSORS; BINDING AGREEMENT.
(a) This Agreement shall be binding upon and shall inure to the
benefit of the Corporation and its Successors and Assigns, and the Corporation
shall require any Successors and Assigns to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Corporation would be required to perform it if no such succession or assignment
had taken place.
(b) Neither this Agreement nor any right or interest hereunder
shall be assignable or transferable by Employee or Employee's beneficiaries or
legal representatives, except by will or by the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
Employee's legal personal representative.
5. NOTICE. Notices and all other communications provided for in
this Agreement shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other; provided, that all notices to the Corporation shall be directed to
the attention of the Board with a copy to the Secretary of the Corporation. All
notices and communications shall be deemed to have been received on the date of
delivery thereof or on the third business day after the mailing thereof, except
that notice of change of address shall be effective only upon receipt.
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6. SETTLEMENT OF CLAIMS. Except as expressly provided herein, the
Corporation's obligation to perform its obligations hereunder shall not be
affected by any circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the Corporation may have
against Employee or others, provided that all amounts payable hereunder shall be
subject to all applicable tax withholding.
7. REGISTRATION. If the Corporation is unable to register
Employee's acquisition of the Purchased Shares on a Form S-8 registration
statement, Employee shall have the same registration rights as are required to
be provided to the purchasers of Series B Preferred stock of the Corporation in
the sale of preferred stock scheduled to occur substantially contemporaneously
with the purchase of the Purchased Shares or, if such purchase of preferred
stock does not occur, similar registration rights.
8. MISCELLANEOUS. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by Employee and the Corporation. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time. No agreement or representation,
oral or otherwise, express or implied, with respect to the subject matter hereof
has been made by either party that is not expressly set forth in this Agreement.
9. GOVERNING LAW; ARBITRATION. Any and all disputes relating to
this Agreement shall be resolved by binding arbitration pursuant to the
procedures and terms of Employee's Compensation and Severance Agreement. Company
and Employee understand and agree that this Agreement and its validity,
construction and performance shall be governed by the laws of the State of
California without regard to conflict of law principles.
10. SEVERABILITY. The provisions of this Agreement shall be deemed
severable, and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
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11. ENTIRE AGREEMENT. This Agreement (together with the interim
employment agreement dated March 18, 2001 ("Interim Employment Agreement") and,
if and when they are executed by both parties and become effective, the
Compensation and Severance Agreement and documents referenced herein and in the
Offer Letter) constitutes the entire agreement between the parties hereto and
supersedes all prior agreements, if any, understandings and arrangements, oral
or otherwise, between the parties hereto with respect to the subject matter
hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement on
the day and year first indicated above.
RESTORATION HARDWARE, INC.
By: /s/ Xxxxxx Xxxxx
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Title:
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Address:
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/s/Xxxx Xxxxxxxx
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EMPLOYEE
Address:
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APPENDIX
The following definitions shall be in effect under the Agreement:
A. AGREEMENT shall mean this Stock Purchase Agreement.
B. BOARD shall mean the Corporation's Board of Directors.
C. COMMON STOCK shall mean shares of the Corporation's common
stock.
D. COMPENSATION AND SEVERANCE AGREEMENT shall mean the
compensation and severance agreement attached to the Corporation's letter dated
March 15, 2001 offering employment to Employee as chief Executive Officer of the
Corporation, provided that such agreement has been executed by both parties and
become effective.
E. CORPORATION shall mean Restoration Hardware, Inc., a Delaware
corporation.
F. OFFER LETTER shall mean the letter from the Corporation dated
March 19, 2001 offering Employee employment with the Corporation as Chief
Executive Officer("Offer Letter").
G. PARENT shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the time
of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
H. PURCHASE PRICE shall have the meaning assigned to such term in
Paragraph A.1.
I. PURCHASED SHARES shall have the meaning assigned to such term
in Paragraph A.1.
J. SERVICE shall mean the Employee's performance of services for
the Corporation (or any Parent or Subsidiary) in the capacity of an employee,
subject to the control and direction of the employer entity as to both the work
to be performed and the manner and method of performance, a non-employee member
of the board of directors or a consultant.
K. SUBSIDIARY shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in the
unbroken chain owns, at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.
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L. SUCCESSORS AND ASSIGNS shall mean a corporation or other entity
acquiring all or substantially all the assets and business of the Corporation
(including this Agreement), whether by operation of law or otherwise.
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