COMMON STOCK PURCHASE AND SALE AGREEMENT
This Common Stock Purchase and Sale Agreement (the "Agreement"), dated
December 5, 1996, by and among RGI Holdings, Inc., a Washington corporation
("RGI"), and SMC Somerset Kensington Partners, L.P., a Delaware limited
partnership (the "Selling Shareholder").
WHEREAS, the Common Stock, par value $0.01 per share ("Common Stock"), of
Banyan Mortgage Investment Fund, a Delaware corporation (the "Company"), is
publicly traded on the New York Stock Exchange under the symbol "VMG";
WHEREAS, the Selling Shareholder owns and desires to sell 724,500 shares of
the Company's Common Stock (as appropriately adjusted as necessary to reflect a
stock split (including the proposed one-for-twenty-five reverse stock split),
stock dividend, merger, consolidation, reclassification, recapitalization or
other similar transaction, the "Shares"), which Shares constitute approximately
1.5% of the total issued and outstanding shares of Common Stock; and
WHEREAS, Purchaser desires to purchase the Shares from the Selling
Shareholder, and the Selling Shareholder desires to sell the Shares to
Purchaser, upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants, agreements and conditions hereinafter
set forth, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. PURCHASE AND SALE OF SHARES. Subject to the terms and conditions of
this Agreement, on the Closing Date (as hereinafter defined) the Selling
Shareholder shall sell the Shares to Purchaser, and Purchaser shall purchase the
Shares from the Selling Shareholder.
2. PURCHASE PRICE.
(a) The purchase price (the "Purchase Price") payable per Share to be
purchased by Purchaser hereunder shall be, as of any date, $0.56 (appropriately
adjusted as necessary to reflect a stock split (including the proposed one-for-
twenty-five reverse stock split), stock dividend, merger, consolidation,
reclassification, recapitalization or other similar transaction with respect to
the Common Stock).
(b) The aggregate Purchase Price payable by Purchaser to the Selling
Shareholder pursuant to this Section 2 shall be paid by bank cashier's check or
wire transfer to an account designated in writing by the Selling Shareholder
prior to the Closing.
3. REPRESENTATIONS AND WARRANTIES OF SELLING SHAREHOLDER. The Selling
Shareholder makes the following representations and warranties to Purchaser,
each of which is true and correct on the date hereof, shall remain true and
correct to and as of the Closing (as hereinafter defined) and shall survive the
Closing:
(a) The Selling Shareholder is duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization. The
Selling Shareholder has all requisite power and authority to enter into this
Agreement and the other documents and instruments to be executed and delivered
by the Selling Shareholder and to carry out the transactions contemplated hereby
and thereby. All entity actions and proceedings necessary to be taken by or on
the part of the Selling Shareholder and and its sole general partner, Somerset
Kensington Capital, Inc. (the "General Partner"), in connection with the
transactions contemplated by this Agreement have been duly and validly taken.
(b) The execution and delivery of this Agreement and the other
documents and instruments to be executed and delivered by the General Partner,
on behalf of the Selling Shareholder, and the consummation of the transactions
contemplated hereby and thereby, have been duly authorized by all requisite
action.
(c) No other act or proceeding on behalf of the Selling Shareholder
or the General Partner is necessary to authorize this Agreement or the other
documents or instruments to be executed and delivered by the Selling Shareholder
pursuant hereto or the consummation of the transactions contemplated hereby and
thereby. This Agreement has been duly and validly executed and delivered by the
Selling Shareholder and constitutes, and when executed and delivered, the other
documents and instruments to be executed and delivered by the Selling
Shareholder pursuant hereto will constitute, valid and binding agreements of the
Selling Shareholder enforceable in accordance with their respective terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting the enforceability of creditors'
rights generally and by general equitable principles. Neither the execution,
delivery and performance of this Agreement nor the consummation of the
transactions contemplated herein will, with or without the giving of notice of
the lapse of time, or both (i) conflict with or result in any violation of or
default under (a) any provision of the governing documents of the Selling
Shareholder, (b) any note, bond, mortgage, indenture, lease, agreement or other
material instrument, permit, concession, grant, franchise or license to which
the Selling Shareholder is a party or by which any of its properties or assets
may be bound or (c) any judgment, order, decree, injunction, statute, rule,
permit, license or regulation applicable to the Selling Shareholder or any of
its properties, or (ii) result in the acceleration of any material obligation or
the creation of any material lien, charge or encumbrance upon the Selling
Shareholder. No authorization, consent or approval of, or declaration of,
filing with or notice to any governmental body or authority is necessary for the
execution, delivery and performance of this Agreement by the Selling
Shareholder.
2
(d) The Selling Shareholder is the owner of the Shares, free and
clear of all liens, claims, charges and other encumbrances, and the shares are
held by Prudential Securities, as custodian, through an account on the book
entry system maintained by the Depository Trust Corporation. Upon the Closing,
the Selling Shareholder shall convey to Purchaser or its permitted assignee good
and marketable title to the Shares, free and clear of all liens, claims, charges
and other encumbrances. The Selling Shareholder has no right, directly or
indirectly (through its General Partner or otherwise), to purchase and has no
interest in any shares of Common Stock other than the Shares.
(e) None of the Selling Shareholder, its General Partner or any
directors, officers, employees or agents thereof has retained, employed or used
any broker or finder in connection with the transactions provided for herein or
in connection with the negotiation thereof.
(f) The Selling Shareholder has not offered, directly or indirectly
(through its General Partner or otherwise), any Shares beneficially owned
thereby for sale, nor solicited any offer to buy any such Shares, by means of
any general advertising or by any other form of general solicitation. The
Selling Shareholder has not offered, directly or indirectly (through its General
Partner or otherwise), any Shares beneficially owned thereby for sale, nor
solicited any offer to buy any such Shares, in any other manner that would
require the sale of the Shares to be subject to the registration requirements of
the Securities Act of 1933, as amended. The Selling Shareholder confirms that
it did not acquire any Shares with a view to, or for, resale in connection with
any distribution thereof within the meaning of the Securities Act of 1933, as
amended, which would not be exempt from the registration requirements of such
Act.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser makes the
following representations and warranties to the Selling Shareholder, each of
which is true and correct on the date hereof, shall remain true and correct to
and as of the Closing, and shall survive the Closing:
(a) Purchaser is a corporation duly organized, validly existing and
in good standing under the laws of the State of Washington. Purchaser has all
requisite power to enter into this Agreement and the other documents pursuant
hereto and to carry out the transactions contemplated hereby and thereby.
(b) The execution and delivery of this Agreement and the other
documents and instruments to be executed and delivered by Purchaser pursuant
hereto and the consummation of the transactions contemplated hereby and thereby
have been duly authorized by the Board of Directors of Purchaser. No other
corporate act or proceeding on the part of Purchaser or its shareholders is
necessary to authorize this Agreement or the other documents and instruments to
be executed and delivered by Purchaser pursuant hereto
3
or the consummation of the transactions contemplated hereby and thereby. This
Agreement constitutes, and when executed and delivered, the other documents and
instruments to be executed and delivered by Purchaser pursuant hereto will
constitute, valid and binding agreements of Purchaser, enforceable in accordance
with their respective terms, except as such may be limited by bankruptcy,
insolvency, reorganization or other laws affecting creditors' rights generally,
and by general equitable principles.
(c) Neither the execution, delivery and performance of this Agreement
nor the consummation of the transactions contemplated herein will, with or
without the giving of notice or the lapse of time, or both, (i) conflict with or
result in any violation of or default under (a) any provision of the Articles of
Incorporation or the bylaws of Purchaser, each as amended and/or restated to
date, (b) any note, bond, mortgage, indenture, lease, agreement or other
material instrument, permit, concession, grant, franchise or license to which
Purchaser is a party or by which any of its properties or assets may be bound or
(c) any judgment, order, decree, injunction, statute, rule, permit, license or
regulation applicable to the Purchaser or any of its properties, or (ii) which
result in the acceleration of any material obligation or the creation of any
material lien, charge or encumbrance upon any of the assets of Purchaser. No
authorization, consent or approval of, or declaration of, filing with or notice
to any governmental body or authority is necessary for the execution, delivery
and performance of this Agreement by Purchaser.
(d) Neither Purchaser nor any of its directors, officers, employees
or agents has retained, employed or used any broker or finder in connection with
the transaction provided for herein or in connection with the negotiation
thereof.
5. COVENANTS OF THE SELLING SHAREHOLDER.
(a) From the date hereof until the Closing, the Selling Shareholder
covenants and agrees that it will not, without the prior written consent of RGI,
directly or indirectly (through its General Partner or otherwise) (i) transfer
any of the Shares, except to Purchaser pursuant hereto, or (ii) exercise any
voting rights of the Shares or grant any proxies (except as set forth herein) or
enter into any voting trust or other agreement or arrangement with respect to
the voting of any Shares.
(b) From the date hereof until the first to occur of (i) the
consummation of the merger of RGI U.S. Holdings, Inc., a Washington corporation,
with and into the Company or (ii) the third business day following the failure
of the shareholders of the Company to approve such a merger at a meeting
thereof, duly called and held, at which a proposal to approve such a merger is
acted upon, the Selling Shareholder shall not, directly or indirectly (through
its General Partner or otherwise), acquire or enter into any contract to
acquire, any additional shares of Common Stock or any voting rights with respect
to any additional shares of Common Stock.
4
6. CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS. Each and every
obligation of Purchaser to be performed on the Closing Date (as hereinafter
defined) shall be subject to the satisfaction prior to or at the Closing of each
of the following conditions:
(a) Each of the representations and warranties made by the Selling
Shareholder in this Agreement shall be true and correct in all material respects
when made and shall be true and correct in all material respects at and as of
the Closing Date as though such representations and warranties were made or
given on and as of such Closing Date.
(b) The Selling Shareholder shall have in all material respects
performed and complied with all of its agreements and obligations under this
Agreement which are to be performed or complied with by it prior to or on the
Closing Date, including the delivery of the closing documents specified in
Section 9.
(c) No injunction or restraining order shall have been issued by any
court of competent jurisdiction that enjoins consummation of the transactions
contemplated hereby.
7. CONDITIONS PRECEDENT TO SELLING SHAREHOLDER'S OBLIGATIONS. Each and
every obligation of the Selling Shareholder to be performed on the Closing Date
shall be subject to the satisfaction prior to or at the Closing on such date of
the following conditions:
(a) Each of the representations and warranties made by Purchaser in
this Agreement shall be true and correct in all material respects when made
shall be true and correct in all material respects at and as of the Closing Date
as though such representations and warranties were made or given on and as of
the Closing Date.
(b) Purchaser shall have in all material respects performed and
complied with all of its agreements and obligations under this Agreement which
are to be performed and complied with by it or prior to or on the Closing Date,
including the delivery of the closing documents specified in Section 10.
(c) No injunction or restraining order shall have been issued by a
court of competent jurisdiction that enjoins consummation of the transactions
contemplated hereby.
8. CLOSING. The closing of the purchase and sale of the Shares (the
"Closing") shall take place at 10:00 a.m. (Pacific Standard Time) on December 6,
1996, or at such other time and place as the parties hereto shall agree upon in
writing. The date on which the Closing occurs is referred to in this Agreement
as the "Closing Date".
9. DOCUMENTS TO BE DELIVERED BY THE SELLING SHAREHOLDER AT THE CLOSING.
At the Closing the Selling Shareholder shall deliver, or cause to be delivered,
to Purchaser the
5
following documents, in each case duly executed or otherwise in proper form:
(a) Either (i) stock certificates, duly endorsed for transfer or with
duly executed stock powers attached thereto, representing the Shares, or (ii)
other customary evidence of transfer of the Shares reasonably satisfactory to
RGI and its legal counsel.
(b) A validly executed irrevocable proxy in the form attached hereto
as Exhibit A.
10. DOCUMENTS TO BE DELIVERED BY PURCHASER AT THE CLOSING. At the
Closing, Purchaser shall deliver to the Selling Shareholder a bank cashier's
check or wire transfer in payment of the aggregate Purchase Price for the Shares
as provided in Section 2 above.
11. PRICE PROTECTION.
(a) For purposes of this Section 11, the following definitions shall
apply:
(i) The term "Acquisition Transaction" shall mean:
(A) the acquisition by any Person of securities
representing at least fifty percent (50%) of the combined voting power of
the Company's then outstanding securities; or
(B) the consummation by any Person of (x) any
consolidation, merger or similar transaction involving the Company in which
the Company is not the continuing or surviving corporation or pursuant to
which shares of the Company's Common Stock are converted into cash or
securities, or (y) any purchase, lease, exchange or other acquisition (in
one transaction or a series of related transactions) of all, or
substantially all, of the assets of the Company.
(ii) The term "Person" shall mean any individual, firm,
partnership, corporation or other entity, including any successor (by
merger or otherwise) of such entity, or a group of any of the foregoing
acting in concert.
(b) In the event any Person (including, but not limited to, the
Purchaser) offers, directly or indirectly, an Acquisition Transaction within
four (4) months following the Closing, Purchaser shall pay to the Selling
Shareholder, on the thirty-third day following the consummation of such
Acquisition Transaction, by bank cashier's check or wire transfer to an account
designated in writing by at least forty-eight (48) hours prior to the time for
payment hereunder), a dollar amount (the "Excess Amount") equal to the product
of (i) the aggregate number of Shares and (ii) the excess, if any, of (x) the
fair market value of the cash and/or securities (as determined below) the
Selling Shareholder would have been
6
entitled to receive for each Share in the Acquisition Transaction had the
Closing under this Agreement not occurred and the Selling Shareholder
participated in the Acquisition Transaction over (y) the Purchase Price per
Share paid by Purchaser to the Selling Shareholder pursuant to this Agreement.
For purposes hereof, the fair market value of any securities shall be the
average closing price of such securities for the five days immediately preceding
the thirtieth day following the consummation of the Acquisition Transaction (as
appropriately adjusted as necessary to reflect a stock split, including the
Company's proposed one-for-twenty-five reverse stock split, stock dividend,
merger, consolidation, reclassification, recapitalization or other similar
transaction). In the event an Acquisition Transaction involves solely the
issuance of shares of voting stock or other securities to the holders of the
Company's Common Stock, the Purchaser may, in lieu of paying the Excess Amount
in cash, pay such amount in shares of the voting stock or other securities
delivered to the holders of the Company's Common Stock in the Acquisition
Transaction.
12. TERMINATION. This Agreement may be terminated by the Selling
Shareholder, on one hand, or the Purchaser, on the other hand, if the Closing
shall not have been consummated prior to 5:00 p.m. (Pacific Standard Time) on
December 6, 1996; PROVIDED, HOWEVER, that the obligations of each of the parties
hereto under Sections 14, 17 and 24 shall continue in full force and effect
notwithstanding any such termination, and that no party shall be relieved from
any liability of any kind or nature whatsoever resulting from or arising out of
a breach thereby of this Agreement occurring prior to such termination.
13. FURTHER ASSURANCES. From time to time prior to, at and after the
Closing, each party hereto shall execute all such instruments and take all such
actions as any other party hereto shall reasonably request in connection with
carrying out and effectuating the transactions contemplated by this Agreement.
14. NOTICES. Any notices required or allowed to be furnished pursuant to
the terms hereof shall be provided to the Selling Shareholder and Purchaser at
the addresses set forth with their signatures below. Notices hereunder shall be
in writing and may be hand delivered, mailed, delivered by overnight courier
service or, if facsimile numbers are provided below, transmitted by facsimile.
If mailed, such notices shall be sent by certified mail, postage prepaid, return
receipt requested. The date which is three (3) business days after the date of
mailing shall be deemed to be the date on which the notice was given. The
postmark affixed to such notice by the U.S. Post Office shall be conclusively
presumed to be the date of mailing for purposes of this Section. In the case of
notices given by hand delivery or overnight courier, such notices shall be
deemed given on the date of the actual receipt. If transmitted by facsimile,
such notices shall be deemed given on the date of the actual receipt of a
complete, legible facsimile transmission, except that if a facsimile
transmission is received after business hours or on a weekend or holiday, then
the notice shall be deemed given on the next business day following the receipt
of the facsimile transmission.
7
15. GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Delaware without regard to the
conflicts of law provisions thereof.
16. ASSIGNMENT.
(a) The rights and obligations of a party hereunder may not be
assigned, transferred or encumbered without the prior written consent of the
other parties, except that Purchaser may assign its rights hereunder to an
affiliate thereof.
(b) This Agreement shall be binding upon, inure to the benefit of,
and be enforceable by the respective successors and permitted assigns of the
parties hereto. Nothing contained herein shall be deemed to confer upon any
other person any right or remedy under or by reason of this Agreement.
17. EXPENSES. Each of the parties hereto shall bear its own expenses and
the expenses of its counsel and other agents in connection with the transactions
contemplated hereby.
18. SATURDAYS, SUNDAYS AND LEGAL HOLIDAYS. If the time for performance of
any of the terms, conditions and provisions hereof shall fall on a Saturday,
Sunday or legal holiday, then the time of such performance shall be extended to
the next business day thereafter.
19. USAGE OF GENDER SPECIFIC TERMS. As used herein, each of the
masculine, feminine and neuter genders shall include the other genders, the
singular shall include the plural, and the plural shall include the singular,
wherever appropriate to the context.
20. ENTIRE AGREEMENT; AMENDMENT. This Agreement embodies the entire
agreement of the parties with respect to the transactions contemplated herein,
including the purchase and sale of Shares, and all prior understandings and
agreements of the parties relating thereto are merged herein. This Agreement
may not be modified in any manner whatsoever except by a written instrument
signed by the Selling Shareholder and the Purchaser.
21. WAIVER. No delay in exercising any right or remedy of any of the
parties hereunder shall constitute a waiver thereof, and no waiver by the
Selling Shareholder or Purchaser of the breach of any covenant of this Agreement
shall be construed as a waiver of any preceding or succeeding breach of the same
or any other covenant or condition of this Agreement.
22. HEADINGS. The headings in this Agreement are inserted for convenience
only
8
and shall not constitute a part hereof.
23. SEVERABILITY. If any term, covenant or condition of this Agreement is
held to be invalid or unenforceable in any respect, such invalidity or
unenforceability shall not affect any other provision hereof and this Agreement
shall be construed as if such invalid or unenforceable provision has never been
contained herein.
24. PUBLIC ANNOUNCEMENTS. The parties shall mutually agree on the content
and timing of any public disclosure in relation to the transactions contemplated
hereby, subject to applicable requirements of law.
25. EXECUTION. This Agreement may be executed in separate counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. Any party may execute this Agreement by
transmitting a copy of its signature by facsimile to the other parties. In such
event the signing party shall deliver an original of the signature page to each
of the other parties within one business day of signing, and failure to do so
deliver such originals shall result in the facsimile copy of that party's
signature being treated as an original.
IN WITNESS WHEREOF, the undersigned parties have executed this Agreement as
of the date and year first above written.
SELLING
SHAREHOLDER: SMC SOMERSET KENSINGTON, L.P.
By: Somerset Kensington Capital, Inc., its sole
general partner
By: ________________________________________
Xxxxxxx X. Xxxxx, President
Address: _________________________
_________________________
_________________________
Facsimile No.:
PURCHASER: RGI HOLDINGS, INC.
By:_____________________________
9
Name:_______________________
Its:________________________
Address: 0000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
10
EXHIBIT A
IRREVOCABLE PROXY
By its execution hereof, the undersigned hereby irrevocably constitutes and
appoints RGI Holdings, Inc., a Washington corporation ("RGI"), with full power
of substitution, as its true and lawful proxy and attorney-in-fact, with respect
to the 724,000 shares ( as appropriately adjusted as necessary to reflect a
stock split, stock dividend, merger, consolidation, reclassification,
recapitalization or other similar transaction, the "Shares") of common stock,
par value $.01 per share ("Common Stock"), of Banyan Mortgage Investment Fund, a
Delaware corporation (the "Company"), beneficially owned by him as of the date
hereof, to: (i) vote at any annual or special meeting of the stockholders of
the Company, to take any action, including without limitation, adopting a
proposed merger of RGI U.S. Holdings, Inc. with and into the Company, amending
the Company's certificate of incorporation to reclassify, combine and convert
each twenty-five issued and outstanding shares of the Company's Common Stock
into one issued and outstanding share, to adopt an Amended and Restated
Certificate of Incorporation of the Company that, among other things, changes
Banyan's name to "Legend Properties, Inc.", and electing directors; (ii) to
exercise written consent in lieu of voting with respect to the matters set forth
in the preceding clause (i); and (iii) to execute, acknowledge, swear to and
file in the name, place and stead of the undersigned any proxy, consent,
approval, or other documents to be executed by the stockholders in connection
with the items set forth in the preceding clauses (i) and (ii). The proxy
granted hereby is irrevocable and is given in connection with the purchase by
RGI of the Shares pursuant to a Common Stock Purchase and Sale Agreement dated
December 5, 1996 (the "Purchase Agreement"), by and among RGI and SMC Somerset
Kensington Partners, L.P.; PROVIDED, HOWEVER, that this Irrevocable Proxy shall
automatically terminate and be of no further force or effect with respect to any
Shares as of June 30, 1997.
IN WITNESS WHEREOF, the undersigned has executed this Irrevocable Proxy as
of the 6th day of December, 1996.
SMC SOMERSET KENSINGTON PARTNERS, L.P.
By: Somerset Kensington Capital, Inc., its sole
general partner
By:_____________________________________
Xxxxxxx X. Xxxxx, President
Address: _____________________
_____________________
_____________________
Facsimile No.:___________________
