STOCK PURCHASE AGREEMENT
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This Stock Purchase Agreement (the "Agreement") is dated as of this 26th
day of June, 2003 by and among Xxxxxx, Inc., a New Jersey corporation (the
"Company"), and each of Xxxxxxx X. Xxxxxxxxx, Xxxx X. Xxxxx, Xxxxx X. Xxxxxxxxx
and Xxxxx X. Xxxxxx (each a "Buyer" and collectively the "Buyers").
WHEREAS, the Company wishes to sell and the Buyers wish to purchase an
aggregate of 4,500,000 shares of common stock, $.05 par value (the "Common
Stock"), of the Company, subject to the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, and of other valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
1. PURCHASE OF SHARES. The Company does hereby agree to sell to each Buyer,
and each Buyer does hereby agree to purchase from the Company, the number
of shares (the "Shares") of the Company's Common Stock set forth next to
the Buyer's name on Exhibit A hereto for a price of $.22 per share.
2. CLOSING. Subject to Section 7 hereof, each Buyer does hereby agree to
deliver the purchase price for the Shares being purchased by him/her
hereunder to the Company contemporaneously with or immediately before the
Asset Purchase Closing (as defined in Section 7 hereof). Upon delivery of
the purchase price, the applicable number of shares will be issued and
certificates representing such shares shall be delivered to each of the
Buyers.
3. REPRESENTATIONS OF THE COMPANY. The Company hereby represents and warrants
to the Buyers as follows:
(a) The Company is a corporation duly organized and validly existing and
in good standing under the laws of the State of New Jersey.
(b) The Company has the full corporate power and authority to enter into
this Agreement and to perform its obligations hereunder.
(c) The Shares of Common Stock being sold and issued to the Buyers
pursuant to this Agreement are duly authorized, validly issued and
non-assessable.
(d) The Company has heretofore delivered to Investor copies of the
Company's (i) Annual Report on Form 10-K Report for the fiscal year
ended November 30, 2002, (ii) Quarterly Report on Form 10-QSB for the
fiscal quarter ended February 28, 2003, and (iii) the proxy statement
relating to the Company's 2003 Annual Meeting of Shareholders, in each
case as filed with the Securities and Exchange Commission (the
"Commission"). The Company has heretofore made available to each Buyer
all other reports, registration statements and other documents filed
by the Company with the Commission under the Securities Exchange Act
of 1934
and the Securities Act of 1933 since November 30, 2000. All such
documents described in the first two sentences of this section are
collectively referred to herein as the "Commission Filings." The
Company has timely filed all reports, registration statements and
other documents required to be filed with the Commission under the
rules and regulations of the Commission, and all Commission Filings
complied as to form with the requirements of the Securities Act or the
Exchange Act, as the case may be. As of their respective dates, the
Commission Filings (including in all cases any exhibits or schedules
thereto or documents incorporated therein by reference) did not
contain any untrue statement of material fact or omit to state a
material fact required to be stated therein, in light of the
circumstances under which they were made, not misleading.
4. REPRESENTATIONS OF BUYER. Each Buyer hereby represents and warrants to the
Company (as to himself or herself only) as follows:
(a) The Company has made available to him/her the opportunity to ask
questions of, and receive answers from, the officers of the Company
concerning the Company and its business. The Buyer acknowledges that
he/she has entered into the transactions contemplated by this
Agreement without being furnished any prospectus.
(b) Without limiting the Buyer's right to sell the Shares pursuant to the
Registration Rights Agreement referred to in Section 5 below, the
Shares are being acquired for investment and not with a view to the
resale or distribution of such Shares. Such Shares are being acquired
by the Buyer for his/her own account, and no other person has a direct
or indirect beneficial interest in such Shares.
(c) The Buyer has adequate net worth to bear the risks of investment
contemplated by this Agreement and adequate means of providing for
his/her current needs and foreseeable personal contingencies and has
no need for liquidity in this investment.
(d) The Buyer understands that the Company has sustained operating losses
in recent years, engages in highly competitive business and there can
be no assurance that it will be able to operate profitably. An
investment in securities of the Company is highly speculative and
involves a high degree of risk and is not recommended for any investor
who cannot afford the risk of losing his entire investment.
(e) The Buyer understands that the Shares have not been registered under
the Securities Act of 1933, as amended (the "Securities Act"), in
reliance on an exemption for private offerings. As a result, in the
absence of registration, the Buyer may have to continue to bear the
economic risk of his investment in the Shares for an indefinite
period, and he/she will not be permitted to transfer any Shares in the
absence of an opinion of counsel, if requested, satisfactory to the
Company that registration is not required under the Securities Act and
under applicable state securities laws.
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(f) The Buyer is an officer of the Company and is therefore familiar with
its operations, financial conditions, risks and prospects.
(g) The Buyer is an "Accredited Investor" as such term is defined in Rule
501 promulgated under the Securities Act.
(h) The Buyer has been advised by the Company to consult with his own
personal tax advisor to determine the effect of an investment in the
Company on his/her Federal and state income tax status.
5. REGISTRATION RIGHTS AGREEMENT. On or prior to the issuance of the Shares,
the Company shall execute a Registration Rights Agreement providing the
Buyers with demand and "piggyback" registration rights in a form mutually
satisfactory to the Company and Buyers.
6. LISTING. The Company agrees that it will submit a listing application for
the Shares to the American Stock Exchange.
7. CONDITIONS TO CLOSING.
(a) The Company's obligation to close the transactions contemplated by
this Agreement shall be subject to the following conditions:
(i) The representations and warranties of each Buyer set forth in
Section 4 above shall have been true and correct when made and
shall be true and correct on and as of the date of the closing
(the "Closing") of the transactions contemplated by this
Agreement.
(ii) No provision of any applicable law or regulation and no
judgment, injunction or decree shall prohibit the consummation
of the transactions contemplated hereby and no proceeding
challenging this Agreement or the transactions contemplated
hereby or seeking to prohibit, alter, prevent or materially
delay the Closing shall have been instituted by any person
before any court, arbitrator or governmental body, agency or
official and be pending.
(iii) Homes by Xxxxxx, LLC shall have contemporaneously closed the
transaction contemplated by the Amended and Restated Agreement
for Sale and Purchase of Assets dated as of June 13, 2003, as
amended through the date hereof, a copy of which has been
provided to each of the Buyers (the "Asset Purchase Closing").
(iv) All of the outstanding membership interests in Homes by
Xxxxxx, LLC shall have been duly assigned to the Company.
(v) The Shares shall have been approved for listing on the
American Stock Exchange.
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(b) The obligation of each Buyer to close the transactions contemplated
hereby shall be subject to the following conditions:
(i) The representations and warranties of the Company set forth in
Section 3 above shall have been true and correct when made and
shall be true and correct on and as of the date of the
Closing.
(ii) No provision of any applicable law or regulation and no
judgment, injunction or decree shall prohibit the consummation
of the transactions contemplated hereby and no proceeding
challenging this Agreement or the transactions contemplated
hereby or seeking to prohibit, alter, prevent or materially
delay the Closing shall have been instituted by any person
before any court, arbitrator or governmental body, agency or
official and be pending.
(iii) The Company shall have applied for the listing of the Shares
on the American Stock Exchange.
(iv) The Company shall have accepted the assignment of all of the
outstanding membership interests in Homes by Xxxxxx, LLC.
(v) Homes by Xxxxxx, LLC shall have contemporaneously closed the
transaction contemplated by the Amended and Restated Agreement
for Sale and Purchase of Assets dated as of June 13, 2003, as
amended through the date hereof, a copy of which has been
provided to each of the Buyers.
8. Termination. This Agreement shall terminate and neither the Company nor any
Buyer shall have any obligation hereunder if the Asset Purchase Closing
shall not have occurred on or before August 29, 2003.
9. GOVERNING LAW. This Agreement and its validity, construction and
performance shall be governed in all respects by the laws of the State of
New Jersey, without giving effect to principles of conflict of laws.
Further, in the event that any dispute arises between the parties to this
Agreement, unless otherwise set forth herein, such dispute shall be settled
by a court of competent jurisdiction of the State of New Jersey or the
United States District Court for the District of New Jersey and the parties
hereto agree to submit to the jurisdiction of the Courts of the State of
New Jersey or the United States District Court for the District of New
Jersey.
10. SEVERABILITY. If any provisions of this Agreement or the application of any
provision hereof to any person or circumstance is held invalid, the
remainder of this Agreement and the application of such provision to other
persons or circumstances shall not be affected unless the provision held
invalid shall substantially impair the benefits of the remaining portions
of this Agreement.
11. BENEFIT OF PARTIES, ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective personal
representatives, heirs,
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successors and assigns. This Agreement may not be assigned by any party
hereto except with the prior written consent of the other party hereto.
12. HEADINGS. The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part hereof.
13. CONSTRUCTION. As used in this Agreement, words in the singular shall be
construed as including the plural and vice versa and words in one gender
shall include all genders unless the context shall clearly require
otherwise.
14. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which shall be an original, but all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement or
caused this Agreement to be executed by their duly authorized corporate officers
as of the day and year first above written.
XXXXXX, INC.
By:_______________________________________
Name:
Title:
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Xxxxxxx X. Xxxxxxxxx
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Xxxx X. Xxxxx
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Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxx
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Schedule A
Name of Buyer Number of Shares
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Xxxxxxx X. Xxxxxxxxx 2,475,000
Xxxx X. Xxxxx 561,000
Xxxxx X. Xxxxxxxxx 1,014,000
Xxxxx X. Xxxxxx 450,000
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