Exhibit 2.3
BUY-SELL AGREEMENT
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THIS BUY-SELL AGREEMENT (the "Agreement") is made and entered into as of
this 12th day of November, 2001, by and among ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ AND HILLS, INC., a
Florida corporation (the "Corporation"), and ▇▇▇▇▇ ▇. ▇▇▇▇▇ LL, an individual
resident of the State of Texas, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, an individual resident of the
State of Texas, W. ▇▇▇▇▇▇ ▇▇▇▇▇▇, an individual resident of the State of Texas,
and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, an individual resident of the State of Texas (collectively,
the "Shareholders," and each, individually, a "Shareholder").
BACKGROUND:
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A. As of the date hereof, the Shareholders are the owners of a total of
Fifteen Thousand (15,000) issued and outstanding shares of the Common Stock of
the Corporation (the "Shares"), which Shares have been issued to the
Shareholders pursuant to that Stock Purchase Agreement of even date herewith by
and between the Corporation, on the one hand, and the Shareholders, on the other
hand, with each Shareholder owning the number of Shares shown on Exhibit A
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hereto;
B. Each of the Shareholders is, as of the date of this Agreement,
employed by the Corporation or one of its subsidiaries; and
C. The Corporation and the Shareholders desire to impose certain
restrictions on the transfer of the Shares and to provide for the purchase of
the Shares by the Corporation under certain circumstances, on the terms and
subject to the conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Put Rights/Mandatory Repurchase.
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(a) In the event that, during the term of this Agreement, the
employment of a Shareholder with the Corporation or any of its "Affiliates" (as
hereinafter defined) is terminated, for any reason or no reason, and such
Shareholder (a "Terminated Shareholder") is, as a result of such termination, no
longer employed by the Corporation or any of its Affiliates (any such occurrence
being referred to herein as a "Termination"), then such Terminated Shareholder
shall, for six (6) months following the effective date of such Termination, have
the right, but not the obligation, to elect, by written notice given to the
Corporation in the manner provided in this Agreement, to sell to the Corporation
all (but not less than all) of the Shares then owned by such Terminated
Shareholder in accordance with Section 1(c). Notwithstanding the foregoing, in
the event of any Termination which occurs prior to the expiration of three (3)
years from the date of this Agreement, the right of the Terminated Shareholder
to elect to sell his Shares under this Section 1(a) shall not arise until the
third (3rd) anniversary of the date of this Agreement, and shall expire on the
date that is six (6) months after the third (3rd) anniversary of the date of
this Agreement. For purposes of this Agreement, the term "Affiliate" shall mean
any entity that controls, is controlled by or is under common control with the
Corporation; provided, however, that control of an entity shall be deemed to
exist only by virtue of ownership of greater than 50%of the voting securities of
such entity.
(b) In the event of the death of any Shareholder (a "Deceased
Shareholder") at any time during the term of this Agreement, the Corporation
shall purchase, and the estate of the Deceased Shareholder shall sell to the
Corporation, all of the Shares owned by such Deceased Shareholder at the time of
his death in accordance with Section 1(c).
(c) The purchase price for any Shares sold to the Corporation pursuant
to this Section 1 shall be the Value Per Share as calculated pursuant to Section
6 multiplied by the number of Shares sold by the selling Shareholder or his
estate, as the case may be. Subject to Section 6(b) (iv), the closing of any
sale of Shares to the Corporation pursuant to this Section 1 shall take place at
a place, date and time mutually acceptable to the selling Shareholder or his
estate, as the case may be, and the Corporation or, if no such agreement is
reached, at the offices of the Corporation, on the twentieth (20th) business day
after (i) the Corporation's receipt of the notice of the Terminated
Shareholder's exercise of his rights contemplated by Section 1(a), in the case
of a sale of Shares pursuant to Section 1(a), or (ii) the applicable court's
approval of an executor or appointment of an administrator of the estate of the
Deceased Shareholder, in the case of a sale of Shares pursuant to Section 1(b).
2. Restrictions on Transfer.
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No Shareholder shall, at any time during the term of this Agreement, sell,
transfer, assign, pledge, hypothecate, encumber, or in any way dispose of any of
his Shares or any right or interest therein (any of the foregoing being referred
to herein as a "Transfer"), without first complying with all of the terms of
this Agreement, and any attempted Transfer not made in compliance with all of
the terms of this Agreement shall be null and void and shall not be recognized
by the Corporation. Notwithstanding the foregoing sentence, a Shareholder may at
any time, without triggering any right of first refusal under this Agreement,
gift all or any portion of his Shares to a member of his family or to a trust
for the benefit of any member of his family.
3. Right of First Refusal.
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(a) If any Shareholder (the "Transferor Shareholder") desires to
Transfer any or all of his Shares to any person or entity, other than by way of
a gift to a member of his family or to a trust for the benefit of any member of
his family, and if the Transferor Shareholder receives a bona fide good faith
offer therefor which it desires to accept, then the Transferor Shareholder shall
give prompt written notice (an "Offer Notice") of the proposed Transfer to the
Corporation in the manner set forth in this Agreement. The Offer Notice shall
set forth the name and address of the proposed transferee, the number of Shares
proposed to be transferred (the "Offered Shares"), the price per Share, the
terms of payment and all other terms and conditions of the proposed Transfer.
(b) For thirty (30) days following the date of receipt of Offer Notice
by the Corporation, the Corporation shall have the option, but not the
obligation, to elect, by written notice given to the Transferor Shareholder in
the manner provided in this Agreement, to purchase all (but not less than all)
of the Offered Shares in accordance with Section 3(c).
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(c) If the Corporation exercises the option to acquire the Offered
Shares pursuant to Section 3(b), the purchase price to be paid therefor shall be
the price set forth in the Offer Notice. Subject to Section 6(b)(iv), the
closing of any sale of Offered Shares to the Corporation pursuant to this
Section 3 shall take place at a place, date and time mutually acceptable to the
Transferor Shareholder and the Corporation, or, if no such agreement is reached,
at the offices of the Corporation on the twentieth (20th) business day after the
Transferor Shareholder has received the notice of exercise of an option
contemplated by Section 3(b).
(d) If the Corporation does not exercise its option to purchase any
Offered Shares, such Offered Shares may be transferred to the proposed
transferee, subject to the provisions of Section 3(e), on the terms specified in
the Offer Notice, at any time within ninety (90) days after the expiration of
the Corporation's option.
(e) Following any Transfer of Offered Shares in accordance with
Section 3(d), (i) any transferee of such Shares shall hold the Shares free and
clear of any duties, obligations, rights or privileges set forth herein,
including the restrictions on transfer and other provisions of this Agreement,
(ii) all of the provisions of this Agreement, including without limitation the
rights of first refusal of the Corporation under this Section 3 and the put
rights of the Shareholder and mandatory purchase obligations of the Corporation
under Section 1, shall, with respect to the Shares so transferred, be
automatically terminated and of no further force or effect, and (iii) any shares
retained by the Transferor Shareholder shall remain in all respects subject to
and governed by this Agreement and all restrictions and rights set forth herein.
4. Deliveries at Closing.
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At any closing of any sale of Shares to the Corporation pursuant to this
Agreement, the selling Shareholder or his estate, as the case may be, shall
deliver to the Corporation the stock certificates evidencing the Shares to be
sold (which Shares shall be free and clear of all liens, security interests,
hypothecations, claims, restrictions and other encumbrances other than the
restrictions imposed by this Agreement), endorsed in blank or accompanied by
duly executed stock powers, and the Corporation shall deliver to the selling
Shareholder or his estate, as the case may be, the purchase price for such
Shares, as determined in accordance with this Agreement. Such purchase price
shall, (i) in the case of any sale of Shares pursuant to Section 1, be paid and
delivered by bank check or wire transfer of immediately available funds, to such
bank and account as is designated by the selling Shareholder or his estate, as
the case may be, or (ii) in the case of any sale of Shares pursuant to Section
3, be paid and delivered in accordance with the terms set forth in the Offer
Notice.
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5. Legend on Share Certificates.
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Each certificate representing the Shares shall bear a legend substantially
to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF A
BUY-SELL AGREEMENT, COPIES OF WHICH MAY BE OBTAINED FROM THE SECRETARY OF THE
COMPANY. ANY ATTEMPTED TRANSFER OR PLEDGE OF THE SHARES REPRESENTED BY THIS
CERTIFICATE IN VIOLATION OF THE TERMS OF SUCH BUY-SELL AGREEMENT SHALL BE NULL
AND VOID AND SHALL NOT BE RECOGNIZED BY THE COMPANY.
6. Value per Share.
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(a) The applicable "Valuation Date" in connection with any sale of
Shares pursuant to this Agreement shall be, (i) in the case of any sale of
Shares pursuant to Section 1(a), the date of the receipt by the Corporation of
the written notice of exercise of the Terminated Shareholder's right to sell his
Shares to the Corporation, (ii) in the case of any sale of Shares pursuant to
Section 1(b), the date of the applicable court's approval of an executor or
appointment of an administrator of the estate of the Deceased Shareholder, or
(iii) in the case of any sale of Shares pursuant to Section 3(b), the date of
the receipt by the Transferor Shareholder of the written notice of the
Corporation's exercise of its option to purchase the Offered Shares. The Value
Per Share for purposes of a sale of Shares pursuant to this Agreement shall, in
each case (except as set forth in Section 6(b)), be the value of one (1) share
of the Corporation's Common Stock which, as of the applicable Valuation Date,
has been most recently determined by an independent valuation firm for purposes
of setting the price at which the shares of the Corporation's Common Stock are
sold to and traded within the ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ and Hills, Inc. Employees 401(k)
Profit Sharing Plan (or any successor plan thereto). For purposes of determining
Value Per Share, any such valuation shall be proportionately adjusted as
appropriate to reflect any "Recapitalization Event" (as hereinafter defined)
occurring subsequent to the date of its determination by the independent
valuation firm and prior to the closing of the applicable sale of Shares
pursuant to this Agreement. For purposes of this Agreement, a Recapitalization
Event shall mean any of the following: (i) the payment by the Corporation of a
dividend on any class of its capital stock in shares of the Corporation's Common
Stock, (ii) the subdivision of the outstanding shares of the Corporation's
Common Stock into a greater number of shares by way of stock split or otherwise,
or (iii) the combination of the outstanding shares of the Corporation's Common
Stock into a smaller number of shares by way of reverse stock split or
otherwise.
(b) Notwithstanding the foregoing, in the event, and only in the
event, that no valuation of the type referred to in Section 6(a) has been
determined within the fifteen (15) month period immediately preceding the
Valuation Date applicable to a sale of Shares pursuant to this Agreement, the
Value Per Share for purposes of such sale shall be the fair market value of the
Shares to be sold, expressed on a per Share basis, as determined by a mutually
agreed to third party appraiser. The collective expenses of any appraisal
conducted pursuant to this Section 6(b) shall be shared equally by the selling
Shareholder or his estate, as the case may be, and the Corporation.
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7. Termination of Agreement.
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This Agreement and all rights and obligations of the Corporation and the
Shareholders hereunder shall terminate in their entirety on the occurrence of
any of the following:
(a) The written agreement of all Shareholders who, at such time,
still own Shares subject to this Agreement (the "Continuing Shareholders") and
the Corporation;
(b) The expiration of twenty (20) years from the date of this
Agreement;
(c) Such time, if any, as all of the Shares have been transferred by
the Shareholders and are no longer subject to this Agreement; or
(d) Such time, if any, as shares of the Corporation's Common Stock
are (A) listed, or authorized for listing, on the New York Stock or the American
Stock Exchange (or any successor thereto), any other national securities
exchange or the NASDAQ Stock Market (or any successor thereto); (B) traded on
the over-the-counter market; or (C) otherwise traded on any established public
trading market.
8. Agreement to Perform Further Acts.
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Each Shareholder agrees to perform any further acts and execute and
deliver any documents that may be reasonably necessary to carry out the
provisions of the Agreement.
9. Waivers, Amendments and Remedies.
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This Agreement may be amended, modified or supplemented, and the terms
hereof may be waived, only by a written instrument signed by the Corporation and
the Continuing Shareholders, or, in the case of a waiver, by the party waiving
compliance.
10. Successors and Assigns.
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This Agreement shall inure to the benefit of, and be binding upon, the
parties hereto and their respective successors, heirs, representatives and
assigns, as the case may be. No party shall assign or delegate this Agreement or
any of the rights or obligations created hereunder without, in the case of an
assignment by any Shareholder, the prior written consent of the Corporation, or,
in the case of an assignment by the Corporation, the prior written consent of
the Continuing Shareholders. Notwithstanding the foregoing, the Corporation may
assign its rights and obligations hereunder without the prior written consent of
the Continuing Shareholders to another entity with or into which the Corporation
merges or with which shareholders of the Corporation exchange shares
constituting a controlling interest
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11. Severability.
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This Agreement shall be deemed severable, and the invalidity or
unenforceability of any term or provision hereof shall not affect the validity
or enforceability of this Agreement or of any other term or provision hereof.
12. Notices.
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All notices and other communications given or made pursuant hereto shall be
in writing and shall be deemed to have been given or made if in writing and
delivered personally, sent by documented overnight delivery service or sent by
certified mail, return receipt requested, to the parties at the respective
addresses set forth on the signature page of this Agreement, or any other
address that a party may designate by written notice to the others. Such notice
or communication shall be deemed to have been given or made (a) if personally
delivered, on the date so delivered, (b) if sent by documented overnight
delivery service, on the next business day following delivery to the overnight
delivery service, or (c) if sent by certified mail, on the third business day
following its deposit in the mail.
13. Governing Law.
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This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Florida.
14. Counterparts.
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This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same instrument. Copies of executed counterparts transmitted by telecopy,
telefax or other electronic transmission service shall be considered original
executed copies for purposes of this Section 14.
15. Entire Agreement.
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This Agreement represents the entire agreement and understanding of the
parties hereto with reference to the subject matter hereof, and no
representations, warranties or covenants have been made in connection with this
Agreement other than those expressly set forth herein. This Agreement supersedes
all prior negotiations, discussions, correspondence, communications,
understandings and agreements between the parties relating to the subject matter
of this Agreement and all prior drafts of this Agreement.
16. Section Headings; Interpretation.
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The section headings contained in this Agreement are solely for convenience
of reference and shall not affect the meaning or interpretation of this
Agreement or of any term or provision hereof. Each party has reviewed, and
participated in drafting, negotiating and revising, this Agreement, and this
Agreement shall not be construed more strongly against any party regardless of
which party, if any, is deemed responsible for its preparation.
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IN WITNESS WHEREOF, the parties have signed, or caused their duly
authorized representatives to sign, this Agreement under seal as of the day and
year first written above.
"Corporation"
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ AND HILLS, INC.
By:
Name: _______________________
Title: _______________________
(Corporate Seal)
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
"Shareholders"
▇▇▇▇▇ ▇. ▇▇▇▇▇ LL
By: ____________________________ (Seal)
▇▇▇▇▇ ▇. ▇▇▇▇▇ LL
Address: ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
By: ____________________________ (Seal)
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Address: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
By: ____________________________ (Seal)
W. ▇▇▇▇▇▇ ▇▇▇▇▇▇
Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
By: ____________________________ (Seal)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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EXHIBIT A
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Shares
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▇▇▇▇▇ ▇. ▇▇▇▇▇ LL 7,100 Shares
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 5,900 Shares
W. ▇▇▇▇▇▇ ▇▇▇▇▇▇ 1,000 Shares
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 1,000 Shares