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EXHIBIT 10.17
XXX.XXX, INC.
SERIES B PREFERRED STOCK
PURCHASE AGREEMENT
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TABLE OF CONTENTS
PAGE
SECTION 1. AGREEMENT TO SELL AND PURCHASE...............................1
1.1 Authorization of Shares......................................1
1.2 Sale and Purchase............................................1
SECTION 2. CLOSING, DELIVERY AND PAYMENT................................2
2.1 Closing......................................................2
2.2 Delivery.....................................................2
2.3 Purchase Option..............................................2
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY................2
3.1 Organization, Good Standing and Qualification................2
3.2 Subsidiaries.................................................3
3.3 Authorization................................................3
3.4 Valid Issuance of Shares.....................................3
3.5 Governmental Consents........................................3
3.6 No Violatoin.................................................3
3.7 Capitalization...............................................4
3.8 Litigation...................................................4
3.9 No Default...................................................4
3.10 Employees....................................................5
3.11 Patents and Trademarks.......................................5
3.12 Transactions with Stockholders, Etc..........................5
3.13 Registration Rights..........................................6
3.14 Compliance with Laws.........................................6
3.15 Material Contracts...........................................6
3.16 Properties, Assets...........................................7
3.17 Environmental and Safety Laws................................7
3.18 Financial Statements.........................................7
3.19 Tax Returns and Audits.......................................8
3.20 Brokers or Finders...........................................8
3.21 Minute Books.................................................8
3.22 Disclosure...................................................8
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER..............8
4.1 Authorization................................................8
4.2 Purchase Entirely for Own Account............................9
4.3 Investment Experience........................................9
4.4 Accredited Investor..........................................9
4.5 Restricted Securities........................................9
4.6 Further Limitations on Disposition...........................9
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SECTION 5. CONDITIONS TO CLOSING........................................9
5.1 Conditions to Purchaser's Obligations at the Closing.........9
5.2 Conditions to Obligations of the Company....................11
SECTION 6. INDEMNIFICATION.............................................12
6.1 Use of Proceeds.............................................12
6.2 Right of First Refusal to Acquire the Company...............12
6.3 Negative Covenants..........................................13
SECTION 7. MISCELLANEOUS...............................................13
7.1 Press Releases..............................................13
7.2 Governing Law...............................................13
7.3 Survival....................................................13
7.4 Successors and Assigns......................................13
7.5 Entire Agreement............................................13
7.6 Severability................................................14
7.7 Amendment and Waiver........................................14
7.8 Delays or Omissions.........................................14
7.9 Notices.....................................................14
7.10 Expenses....................................................14
7.11 Attorneys' Fees.............................................14
7.12 Titles and Subtitles........................................15
7.13 Counterparts................................................15
7.14 Broker's Fees...............................................15
7.15 Specific Performance........................................15
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XXX.XXX, INC.
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
THIS SERIES B PREFERRED STOCK PURCHASE AGREEMENT (the "Agreement") is
entered into as of April 8, 1997, by and among XXX.XXX, INC., a Delaware
corporation (the "Company") and AMERICAN EXPRESS TRAVEL RELATED SERVICES
COMPANY, INC. (the "Purchaser").
RECITALS
WHEREAS, the Company has authorized the sale and issuance of up to an
aggregate of one million fifty-five thousand one hundred fifty-eight (1,055,158)
shares of its Series B Preferred Stock;
WHEREAS, the Purchaser desires to purchase five hundred twenty-seven
thousand five hundred seventy-nine (527,579) shares of Series B Preferred Stock
(the "Shares"), and have the option to purchase a minimum of three hundred
fifty-one thousand four hundred twenty-one (351,421) and up to a maximum of five
hundred twenty-seven thousand five hundred seventy-nine (527,579) shares of
Series B Preferred Stock on the terms and conditions set forth herein; and
WHEREAS, the Company desires to issue and sell the Shares to the
Purchaser, and to grant the Purchaser the option to purchase such additional
shares, on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
SECTION 1. AGREEMENT TO SELL AND PURCHASE.
1.1 AUTHORIZATION OF SHARES. On or prior to the Initial Closing (as
defined in Section 2 below), the Company shall have authorized (i) the sale and
issuance to Purchaser of the Shares and (ii) the issuance of such shares of
Common Stock to be issued upon conversion of the Shares (the "Conversion
Shares"). The Shares and the Conversion Shares shall have the rights,
preferences, privileges and restrictions set forth in the Restated Certificate
of Incorporation of the Company, as amended, in the form attached hereto as
Exhibit A (the "Restated Certificate").
1.2 SALE AND PURCHASE. Subject to the terms and conditions hereof, at
the Initial Closing the Company hereby agrees to issue and sell to the Purchaser
and the Purchaser agrees to purchase from the Company the Shares at a purchase
price of Five Dollars Sixty-Nine Cents ($5.69) per share.
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SECTION 2. CLOSING, DELIVERY AND PAYMENT.
2.1 CLOSING. The closing of the sale and purchase of the Shares under
this Agreement (the "Initial Closing") shall take place at 1:00 p.m. on the date
hereof, at the offices of Xxxxxx Godward LLP, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxx 00000-0000, or at such other time or place as the Company and
the Purchaser may mutually agree. The closing of the sale and purchase of the
Shares under the purchaser option set forth in Section 2.3 below, shall take
place at 1:00 p.m. on the date five (5) business days after the Company receives
notice of Purchaser's election to buy the option shares, at the offices of
Xxxxxx Godward LLP, 0000 Xxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx
00000-0000, or at such other time or place as the Company and the Purchaser may
mutually agree (the "Option Closing") (the Initial Closing and the Option
Closing are referred to herein as the "Closing" and each such date is
hereinafter referred to as the "Closing Date").
2.2 DELIVERY. At the Initial Closing, subject to the terms and
conditions hereof, the Company will deliver to the Purchaser a certificate
representing the number of Shares to be purchased at the Closing by the
Purchaser, against payment of the purchase price therefor by check or wire
transfer made payable to the order of the Company.
2.3 PURCHASER OPTION. At any time on or before the first anniversary of
the Initial Closing (the "Option Period"), the Purchaser may purchase no less
than a minimum of three hundred fifty-one thousand four hundred ninety-four
(351,494) shares and up to a maximum of five hundred twenty-seven thousand five
hundred seventy-nine (527,579) shares at a price of the lower of (i) Five
Dollars Sixty-Nine Cents ($5.69) per share, or (ii) the price per share of the
Preferred Stock in any of the Company's rounds of equity financing during the
Option Period (the "Future Preferred") calculating the price per share of the
Future Preferred by dividing such price of the Future Preferred by the number of
shares of Common Stock into which a share of Future Preferred is convertible.
Such sale shall be made on the terms and conditions set forth in this Agreement,
including, without limitation, the representations and warranties by the
Purchaser as set forth in Section 4 and the conditions to Purchaser's
obligations to close set forth in Section 5 below. Any shares of Series B
Preferred Stock sold pursuant to this Section 2.3 shall be deemed to be "Shares"
for all purposes under this Agreement.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to Purchaser as follows except as set forth on the
Schedule of Exceptions attached hereto as Exhibit B (the "Schedule of
Exceptions") which exceptions shall be deemed to be representations and
warranties as if made hereunder.
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of
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Delaware and has all requisite corporate power and authority to own its
property, to carry on its business as presently conducted and to enter into and
carry out the transactions contemplated by this Agreement, the Investor Rights
Agreement attached hereto as Exhibit C and the Marketing Agreement attached
hereto as Exhibit D (collectively, the "Agreements"). The Company is duly
qualified to transact business and is in good standing under the laws of the
State of Colorado. The Company has all necessary governmental authorizations to
own or lease its properties and assets and to carry on its business as now being
conducted.
3.2 SUBSIDIARIES. The Company does not presently own or control,
directly or indirectly, any interest in any other corporation, association, or
other business entity. The Company is not a participant in any joint venture,
partnership or similar arrangement.
3.3 AUTHORIZATION. All corporate action on the part of the Company, its
officers and directors necessary for the authorization, execution and delivery
of this Agreement and the Agreements, the performance of all obligations of the
Company hereunder and thereunder, and the authorization, issuance (or
reservation for issuance), sale and delivery of the Shares and the Conversion
Shares has been taken, and this Agreement and the Agreements constitute valid
and legally binding obligations of the Company, enforceable in accordance with
their respective terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors' rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other
equitable remedies, (iii) to the extent the indemnification provisions contained
in Section 2.9 of the Investors' Rights Agreement may be limited by applicable
federal or state securities laws and (iv) except to the extent that the amount
of attorneys' fees recoverable in any lawsuit is subject to the supervisory
powers and discretion of the court.
3.4 VALID ISSUANCE OF SHARES. The Shares, when issued, sold and
delivered in accordance with the terms of this Agreement for the consideration
referred to herein will be duly authorized and validly issued, fully paid and
nonassessable, and Purchaser will have acquired good and marketable title to
such securities, free and clear of any claims, liens, restrictions on transfer
or voting or encumbrances.
3.5 GOVERNMENTAL CONSENTS. Other than the filing of the Restated
Certificate, no consents, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any federal, state or
local governmental authority on the part of the Company is required in
connection with the offer, sale or issuance of the Shares and the Conversion
Shares or the consummation of any other transaction contemplated hereby.
3.6 NO VIOLATION. The execution, delivery and performance of this
Agreement and each of the Agreements does not and will not, with or without the
passage of time or the giving of notice or both (a) violate any provision of
law, statute, rule or regulation applicable to the Company or any ruling, writ,
injunction, order, judgment or decree of any court, administrative agency or
other governmental body by which the Company is bound or (b) conflict with or
result in any breach of the terms of or constitute a default (or give any rise
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to any right of termination, cancellation or acceleration) under, or result in a
right of termination or acceleration under, or the creation of any lien, claim
or encumbrance upon any of the properties or assets of the Company under (i) its
Certificate of Incorporation or Bylaws or (ii) any note, bond, mortgage,
indenture, deed of trust, license, lease, agreement or other instrument or
obligation to which the Company is a party or by which the Company or its assets
may be bound.
3.7 CAPITALIZATION. At the date hereof, the Company's authorized
capital stock will consist of 12,844,842 shares of Common Stock and 2,155,158
shares of Preferred Stock of which 1,100,000 are designated Series A Preferred
Stock and 1,055,158 are designated Series B Preferred Stock. Immediately after
the Closing, the issued and outstanding capital stock of the Company shall be as
set forth on Exhibit E. All issued and outstanding shares of Common Stock and
Series A Preferred Stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable. The outstanding shares of Series A
Preferred Stock and Common Stock are owned by the shareholders and in the
numbers specified on Exhibit E attached hereto. Except for 530,230 shares of
Common Stock reserved for issuance under the Company's 1997 Stock Option Plan
and except as may be granted pursuant to the Agreements, there are not
outstanding any options, warrants, rights (including conversion or preemptive
rights), commitments, or agreements for the purchase or acquisition from the
Company of any shares of its capital stock or other securities. The Company is
not a party or subject to any agreement or understanding, and, to the Company's
knowledge without investigation, there is no agreement or understanding between
any Persons which affects or relates to the voting or giving of written consents
with respect to any security or any director of the Company.
3.8 LITIGATION. There is no action, suit or proceeding pending against,
or to the best of the Company's knowledge, currently threatened before any
court, administrative agency or other governmental body against the Company
which questions the validity of this Agreement or the Agreements, or the right
of the Company to enter into any of such Agreements, or to consummate the
transactions contemplated hereby or thereby, or which could result either
individually or in the aggregate, in any material adverse change in the
condition (financial or otherwise), business, property, assets or liabilities of
the Company, nor is the Company aware that there is any valid basis for the
foregoing. The foregoing includes, without limitation, actions, suits,
proceedings or investigations pending or threatened (or any basis therefor known
to the Company) involving the prior employment of any of the Company's
employees, their use in connection with the Company's business of any
information or techniques allegedly proprietary to any of their former
employers, or their obligations under any agreements with prior employers. The
Company is not a party or subject to, and none of its assets is bound by, the
provisions of any order, writ, injunction, judgment or decree of any court or
government agency or instrumentality. There is no action, suit or proceeding by
the Company currently pending or which the Company presently intends to
initiate.
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3.9 NO DEFAULT. The Company is not in violation or default under any
provision of its Certificate of Incorporation or its Bylaws, each as in effect
at the Closing. The Company is not in violation or default of any provision of
any instrument, mortgage, deed of trust, loan, contract, commitment, judgment,
decree, order or obligation to which it is a party or by which it or any of its
properties or assets are bound which would materially adversely affect the
condition (financial or otherwise), business, property, assets or liabilities of
the Company, or any note, indenture, mortgage, lease, agreement, contract,
purchase order or other obligation. There exists no condition, event or act
which after notice, lapse of time, or both, is reasonably likely to constitute a
default by the Company under any of the foregoing.
3.10 EMPLOYEES. The Company does not employ anyone to perform services
for the Company except in the capacity of an employee or consultant. Each
employee of and consultant to the Company has executed a Proprietary Information
and Inventions Agreement in substantially the form of Exhibit G. To the best
knowledge of the Company, no officer or employee is in violation of such
Proprietary Information and Inventions Agreement. The Company is not a party to
or bound by any currently effective employment contract, deferred compensation
agreement, bonus plan, incentive plan, profit sharing plan, retirement agreement
or other employee compensation agreement or arrangement or with any collective
bargaining agent. No employees of the Company are represented by any labor union
or covered by any collective bargaining agreement. There is no pending or, to
the best of the Company's knowledge, threatened labor dispute involving the
Company and any group of its employees. The Company is not aware that any
officer or key employee, or that any group of key employees, intends to
terminate their employment with the Company. The employment of each officer and
employee of the Company is terminable at the will of the Company. Neither the
Company nor any employee is a party to, or is bound by, any agreement which
would limit in any material respect: (a) any employee's ability to perform his
obligations as a full time employee of the Company; or (b) the Company's or any
employee's ability or authority to engage in any and all lines of business in
which the Company currently engages or proposes to engage as set forth in its
current business plan.
3.11 PATENTS AND TRADEMARKS. The Schedule of Exceptions contains a
complete list of patents and pending patent applications and trademarks of the
Company. The Company has sufficient title and ownership of all patents,
trademarks, service marks, trade names, copyrights, trade secrets, information,
domain names (as registered with InterNIC), proprietary rights and processes
necessary for its business as now conducted and as proposed to be conducted and
has the unrestricted right to use the foregoing without the payment of any
royalty. To the best of the Company's knowledge, all of the existing patents and
trademarks of the company are valid and all of the pending and proposed patent
applications and applications for registration of trademarks of the Company will
result in the valid issuance of patents or registration of trademarks. The
Company has not received any communications alleging that the Company has
violated or, by conducting its business as proposed, would violate any of the
patents, trademarks, service marks, trade names, copyrights or trade secrets or
other proprietary rights of any other person or entity. Neither the execution
nor delivery of this Agreement or the Agreements, nor the carrying on of the
Company's business as currently
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proposed to be conducted, will, to the best of the Company's knowledge, conflict
with or result in a breach of the terms, conditions or provisions of, constitute
a default under, any contract, covenant or instrument under which the Company is
bound. To the best of the Company's knowledge, no employee of the Company is in
violation of any terms of any employee contract, patent disclosure agreement or
any other contract or agreement relating to the relationship of such employee
with the Company because of the nature of the business conducted or to be
conducted by the Company.
3.12 TRANSACTIONS WITH STOCKHOLDERS, ETC. No stockholder, employee,
officer or director of the Company or member of his or her immediate family, is
indebted to the Company, nor is the Company indebted (or committed to make loans
or extend or guarantee credit) to any of them. To the best of the Company's
knowledge, no employee, officer or director has any direct or indirect ownership
interest in any firm or corporation with which the Company is affiliated or with
which the Company has a business relationship, or any firm or corporation that
competes with the Company, except that employees, officers or directors of the
Company and members of their immediate families may own less than five percent
(5%) of the stock in publicly traded companies that may compete with the
company. No member of the immediate family of any officer or director of the
Company is directly or indirectly interested in any material contract with the
Company.
3.13 REGISTRATION RIGHTS. The Company is not under any contractual
obligation to register any of its presently outstanding securities or any of its
securities which may hereafter be issued under any securities laws of any
jurisdiction except as set forth in the Investors' Rights Agreement.
3.14 COMPLIANCE WITH LAWS. The Company has at all times conducted and
is now conducting its business in compliance with all laws, rules and
regulations applicable to it. The Company has all franchises, permits, licenses
and any similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, properties, prospects or financial condition of the company and
believes it can obtain, without undue burden or expense, any similar authority
for the conduct of its business as planned to be conducted. The Company is not
in default in any material respect under any of such franchises, permits,
licenses or similar authority.
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3.15 MATERIAL CONTRACTS
(a) Except for agreements explicitly contemplated hereby,
there are no agreements, understandings or proposed transactions between the
Company and any of its officers, directors, affiliates or any affiliate thereof.
(b) There are no agreements, understandings, instruments,
contracts, proposed transactions, judgments, orders, writs or decrees to which
the Company is a party or by which it is bound which may involve (i) obligations
(contingent or otherwise) of, or payments to the Company in excess of $25,000,
or (ii) the license of any patent, copyright, trade secret or other proprietary
right to or from the Company (other than licenses arising from the purchase of
"off the shelf" or other standard products), or (iii) provisions restricting or
affecting the development, manufacture or distribution of the Company's products
or services, or (iv) indemnification by the Company with respect to
infringements of proprietary rights (other than indemnification obligations
arising from purchase or sale agreements entered into in the ordinary course of
business).
(c) The Company has not (i) declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) incurred any indebtedness for money borrowed or any
other liabilities individually in excess of $25,000 or, in the case of
indebtedness and/or liabilities individually less than $25,000, in excess of
$75,000 in the aggregate, (iii) made any loans or advances to any person, other
than ordinary advances for travel expenses, or (iv) sold, exchanged or otherwise
disposed of any of its assets or rights, other than the sale of its inventory in
the ordinary course of business.
(d) For the purposes of subsections (b) and (c) above, all
indebtedness, liabilities, agreements, understandings, instruments, contracts
and proposed transactions involving the same person or entity (including persons
or entities the Company has reason to believe are affiliated therewith) shall be
aggregated for the purpose of meeting the individual minimum dollar amounts of
such subsections.
(e) The Schedule of Exceptions contains a true and complete
list of all Material Contracts (as defined below) in effect on the date hereof.
Each Material Contract is in full force and effect and is a valid and binding
obligation of the Company, enforceable against it in accordance with its terms.
Neither the Company nor to the Company's knowledge, any other party to any such
contract is in default of any provision thereof. "Material Contract" means any
agreement to which the Company is a party, and which involves or relates to (A)
any current or future employment or consulting arrangement; (B) any labor union
or collective bargaining agreement; (C) any indebtedness for borrowed money or
other loan or financing arrangement or any liability on any other debt or other
obligation; (D) any agreement to which any governmental authority is a party;
(E) any transaction not in the ordinary course of business; (F) any agreement
involving prospective obligations or the right to receive in the aggregate in
excess of $25,000; (G) any agreement with the stockholders
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(other than the Agreements); or (H) any mortgage, pledge, security agreement,
financing statement or other document granting a lien, claim or encumbrance on
any of the Company's properties or assets.
(f) The Company is not a party to and is not bound by any
contract, agreement or instrument, or subject to any restriction under its
Certificate of Incorporation or its Bylaws that adversely affects its business
as now conducted or as proposed to be conducted, its properties or its financial
condition.
3.16 PROPERTIES, ASSETS. The Company owns its property and assets free
and clear of all mortgages, liens, loans and encumbrances, except such
encumbrances and liens which arise in the ordinary course of business and do not
materially impair the Company's ownership or use of such property or assets.
With respect to the property and assets it leases, the Company is in compliance
with such leases, and, to the best of its knowledge, holds a valid leasehold
interest free of any liens, claims or encumbrances.
3.17 ENVIRONMENTAL AND SAFETY LAWS. To the best of its knowledge, the
Company is not in violation of any applicable statute, law or regulation
relating to the environment or occupational health and safety, and to the best
of its knowledge, no material expenditures are or will be required in order to
comply with any such existing statute, law or regulation.
3.18 FINANCIAL STATEMENTS. Attached hereto as Exhibit F are the
unaudited financial statements at and for the period ended February 28, 1997
(the "Financial Statements"). The Financial Statements are complete and correct
in all material respects and accurately set out and describe the financial
condition and operating results of the Company as of the dates, and for the
periods, indicated therein. The Financial Statements have been prepared in
accordance with generally accepted accounting principles ("GAAP") except for
footnotes required by GAAP. Except as set forth in the Financial Statements, the
Company has no liabilities, contingent or otherwise, other than (i) liabilities
incurred in the ordinary course of business subsequent to February 28, 1997 (the
"Statement Date") which in the aggregate do not exceed Seventy-Five Thousand
Dollars ($75,000) and (ii) obligations under contracts and commitments incurred
in the ordinary course of business and not required under GAAP to be reflected
in the Financial Statements, which, in both cases, individually or in the
aggregate, are not material to the financial condition or operating results of
the Company. Except as disclosed in the Financial Statements, the Company is not
a guarantor or indemnitor of any indebtedness of any other person, firm or
corporation. Since the Statement Date, there has not been any material adverse
change in the financial condition of the Company.
3.19 TAX RETURNS AND AUDITS. The Company has accurately prepared all
United States income tax returns and all state and municipal tax returns
required to be filed by it, if any, has paid all taxes, assessments, fees and
charges when and as due under such returns and has made adequate provision for
the payment of all other taxes, assessments, fees and charges shown on such
returns or on assessments received by the Company. To the best of the Company's
knowledge, no deficiency assessment or proposed adjustment of the Company's
United States income tax or state or municipal taxes is pending.
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3.20 BROKERS OR FINDERS. The Company has not agreed to incur, directly
or indirectly, any liability for brokerage or finders' fees, agents' commissions
or other similar charges in connection with this Agreement or any of the
transactions contemplated hereby.
3.21 MINUTE BOOKS. The minute books of the Company provided to the
Purchaser contain a complete summary of all meetings of directors and
stockholders since the time of incorporation and reflect all transactions
referred to in such minutes accurately in all material respects.
3.22 DISCLOSURE. No representation, warranty or statement by the
Company in this Agreement, or in any written statement or certificate furnished
to the Purchaser pursuant to this Agreement or the transactions contemplated
hereby, contains any untrue statement of a material fact or, when taken
together, omit to state a material fact necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading. However, as to any projections furnished to the Purchaser, such
projections were prepared in good faith by the Company, but the Company makes no
representation or warranty that it will be able to achieve such projections.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.
Purchaser hereby represents and warrants to the Company as follows:
4.1 AUTHORIZATION. The Agreements constitute and will constitute valid
and legally binding obligations of the Purchaser, enforceable in accordance with
their respective terms except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors' rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other
equitable remedies, (iii) to the extent the indemnification provisions of
Section 2.9 of the Investors' Rights Agreement may be limited by applicable
federal or state securities laws and (iv) except to the extent that the amount
of attorneys' fees recoverable in any lawsuit is subject to the supervisory
powers and discretion of the court.
4.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made with
Purchaser in reliance upon Purchaser's representation to the Company, which by
Purchaser's execution of this Agreement Purchaser hereby confirms, that the
Shares to be received by Purchaser and the Conversion Shares will be acquired
for investment for Purchaser's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and Purchaser has
no present intention of selling, granting any participation in, or otherwise
distributing the same. By executing this Agreement, Purchaser further represents
that Purchaser does not have any contract, undertaking, agreement or arrangement
with any person to sell, transfer or grant participations to such person or to
any third person, with respect to any of the Shares or Conversion Shares.
Purchaser represents that it has full power and authority to enter into this
Agreement.
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4.3 INVESTMENT EXPERIENCE. Purchaser is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment in the Company.
4.4 ACCREDITED INVESTOR. Purchaser is an "accredited investor" within
the meaning of Rule 501 of Regulation D of the Securities Act of 1933, as
amended (the "Act"), as presently in effect.
4.5 RESTRICTED SECURITIES. Purchaser understands that the Shares and
the Conversion Shares are characterized as "restricted securities" under the
federal securities laws inasmuch as they are being acquired from the Company in
a transaction not involving a public offering and that under such laws and
applicable regulations such securities may be resold without registration under
the Act only in certain limited circumstances. In this connection, Purchaser
represents that it is familiar with Rule 144 of the Act, as presently in effect,
and understands the resale limitations imposed thereby and by the Act.
4.6 FURTHER LIMITATIONS ON DISPOSITION. Purchaser acknowledges that the
Shares and, if issued, the Conversion Shares, are subject to restrictions on
transfer as set forth in the Investor Rights Agreement.
SECTION 5. CONDITIONS TO CLOSING.
5.1 CONDITIONS TO PURCHASER'S OBLIGATIONS AT THE CLOSING. Purchaser's
obligations to purchase the Shares at each Closing are subject to the
satisfaction, at or prior to each such Closing, of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing Date
with the same force and effect as if they had been made as of the Closing Date,
and the Company shall have performed all obligations and conditions herein
required to be performed or observed by it on or prior to the Closing.
(b) LEGAL INVESTMENT. On the Closing Date, the sale and
issuance of the Shares and the proposed issuance of the Conversion Shares shall
be legally permitted by all laws and regulations to which the Purchaser and the
Company are subject, and no action is pending seeking to prevent such sale and
issuance.
(c) CONSENTS, PERMITS, AND WAIVERS. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Agreements (except for such as may be properly obtained subsequent to the
Closing).
10.
14
(d) FILING OF RESTATED CERTIFICATE. The Restated Certificate
shall have been filed with the Secretary of State of the State of Delaware.
(e) CORPORATE DOCUMENTS. The Company shall have delivered to
the Purchaser or its counsel, copies of all corporate documents of the Company
as the Purchaser shall reasonably request.
(f) RESERVATION OF CONVERSION SHARES. The Conversion Shares
issuable upon conversion of the Shares shall have been duly authorized and
reserved for issuance upon such conversion.
(g) COMPLIANCE CERTIFICATE. The Company shall have delivered
to Purchaser a Compliance Certificate, executed by the President of the Company,
dated the date of the Closing, to the effect that the conditions specified in
subsection (a) of this Section 5.1 have been satisfied.
(h) INVESTOR RIGHTS AGREEMENT. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit C shall have been executed
and delivered by the parties thereto.
(i) MARKETING AGREEMENT. A Marketing Agreement substantially
in the form attached hereto as Exhibit D shall have been executed and delivered
by the Company and the Purchaser.
(j) BOARD OF DIRECTORS. Upon the Closing, the authorized size
of the Board of Directors of the Company shall be three members and the Board
shall consist of Xxxx Street, Xxxx Xxxxxxx and a representative designated by
Purchaser.
(k) LEGAL OPINION. The Purchaser shall have received from
legal counsel to the Company an opinion addressed to it, dated as of the Closing
Date, in substantially the form attached hereto as Exhibit H.
(l) NO MATERIAL ADVERSE CHANGE. There shall have been no
material adverse change in the business, affairs, prospects, operations,
properties, assets or condition of the Company since the Statement Date.
(m) PROCEEDINGS AND DOCUMENTS. All corporate and other
proceedings in connection with the transactions contemplated at the Closing
hereby and all documents and instruments incident to such transactions shall be
reasonably satisfactory in substance and form to the Purchaser and their special
counsel, and the Purchaser and their special counsel shall have received all
such counterpart originals or certified or other copies of such documents as
they may reasonably request.
11.
15
(n) STOCK RESTRICTION AGREEMENTS AND NON-COMPETE. Xxxx Street,
Xxxx Xxxxxxx and Xxxxxx X. Xxxxx, Xx. shall have entered into the Stock
Restriction Agreements attached hereto as Exhibits I-1, I-2 and
I-3,respectively, and Xxxx Street shall have entered into the Non-Compete
Agreement attached hereto as Exhibit J.
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation
to issue and sell the Shares at each Closing is subject to the satisfaction, on
or prior to each such Closing, of the following conditions:
(a) REPRESENTATIONS AND WARRANTIES TRUE. The representations
and warranties made by the Purchaser in Section 4 hereof shall be true and
correct in all material respects at the date of the Closing, with the same force
and effect as if they had been made on and as of said date.
(b) PERFORMANCE OF OBLIGATIONS. The Purchaser shall have
performed and complied with all agreements and conditions herein required to be
performed or complied with by the Purchaser on or before the Closing.
(c) FILING OF RESTATED CERTIFICATE. The Restated Certificate
shall have been filed with the Secretary of State of the State of Delaware.
(d) INVESTOR RIGHTS AGREEMENT. An Investor Rights Agreement
substantially in the form attached hereto as Exhibit C shall have been executed
and delivered by the Purchaser.
(e) MARKETING AGREEMENT. A Marketing Agreement substantially
in the form attached hereto as Exhibit D shall have been executed and delivered
by the Company and the Purchaser.
(f) CONSENTS, PERMITS, AND WAIVERS. The Company shall have
obtained any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Agreements (except for such as may be properly obtained subsequent to the
Closing).
SECTION 6. COVENANTS.
6.1 USE OF PROCEEDS. The Company shall use $1,000,000 of the proceeds
from the Initial Closing and $1,000,000 of the proceeds from the exercise of the
purchaser option set forth in Section 2.3 above, for the purposes set forth in
Section 2(d) of the Marketing Agreement.
6.2 RIGHT OF FIRST REFUSAL TO ACQUIRE THE COMPANY. The Company hereby
grants the Purchaser the right of first refusal to acquire the Company according
to the following terms:
12.
16
(a) The Company shall notify Purchaser in writing in the event
that either (i) the Board of Directors of the Company determines that it is in
the best interests of the stockholders to sell the Company and elects to
actively shop the Company (the "Shop"), (ii) the Company has received a bona
fide offer to purchase the Company (the "Bona Fide Offer), or (iii) the Board of
Directors of the Company determines that it is in the best interests of the
Company to undertake an underwritten public offering and the Company has
received written notice of the approval of such an offering by the commitment
committee (or similar body) of the lead managing underwriter (the "Underwriter")
(the "IPO"); provided, however, that such IPO shall be firmly underwritten and
such Underwriter shall be an underwriter of recognized national standing. In the
case of the Shop, such notification shall include all terms and conditions on
which the Company desires to sell the Company. In the case of the receipt of a
Bona Fide Offer, such notification shall include all terms and conditions of the
offer (including the identity of the offering party, the total consideration
offered and the method of paying the consideration). In the case of the IPO,
such notification shall include the valuation proposed by the Underwriter. This
Section 6.2 is intended to apply to a sale or purchase of the Company regardless
of its form, including a sale or other disposition of substantially all of the
assets of the Company or a merger, consolidation or reorganization.
(b) Within thirty (30) days of receipt of such notice with
respect to a Shop or a Bona Fide Offer, Purchaser will have the right to acquire
the Company on the same terms and conditions as are set forth in the above
notice. Within twenty (20) days of receipt of such notice with respect to an
IPO, Purchaser will have the right to acquire the Company at the valuation
proposed by the Underwriter. The thirty (30) and twenty (20) day periods are
referred to collectively herein as the "Option Periods" and individually as an
"Option Period").
(c) In the event Purchaser elects not to acquire the Company
within such Option Period, then the Company may, within a ninety (90) day period
following expiration of an Option Period, (i) seek a purchaser for the Company
on the terms set forth in the Shop notice, (ii) accept the Bona Fide Offer;
provided, that such sale or merger may be on terms no more favorable to the
acquiror than those stated in the Bona Fide Offer and notice, or (iii) complete
the IPO. In the case of subsection 6.2(c)(i) above, if the Company identifies a
purchaser for the Company, then the Company shall provide Purchaser with notice
pursuant to subsection 6.2(a)(ii) above and Purchaser shall have the right of
first refusal with respect to such sale as set forth in this Section 6.2. If
such sale or merger or IPO is not completed in such ninety (90) day period, the
procedures set forth in this Section 6.2 must be complied with again.
6.3 NEGATIVE COVENANTS. So long as Purchaser owns at least 250,000
shares of Series B Stock, the Company may not without the approval of the
representative of the Series B Stock on the Company's Board of Directors:
(a) issue any debt security in a single transaction or a
series of related transactions with an aggregate principal amount in excess of
fifty percent (50%) of the Company's equity at the closing of such financing;
13.
17
(b) acquire or obtain a ten percent (10%) or greater interest
in, or permit any subsidiary of the Company to acquire or obtain a ten percent
(10%) or greater interest in, any stock or other securities of any other
corporation, partnership or entity;
(c) declare or pay any dividends on any shares of Common Stock
other than in compliance with Article IV (D)(1) of the Restated Certificate;
provided, however, that repurchase of such shares may be made in connection with
any Restricted Stock Purchase Agreement between the Company and any employee; or
(d) sell any Shares which Purchaser does not purchase pursuant
to the Purchaser Option set forth in Section 2.3 above to any third party.
SECTION 7. MISCELLANEOUS.
7.1 PRESS RELEASES. Except as otherwise required by law, on or prior to
the Closing Date, Purchaser, on the one hand and the Company, on the other, may
not issue or cause publication of any press release or other public announcement
with respect to this Agreement or the transactions contemplated hereby, without
the prior written consent of the other party.
7.2 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of New York without giving effect to conflict of law
principles, with the exception that matters of corporate law shall be governed
by the laws of the State of Delaware.
7.3 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by the Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
7.4 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of the Shares from time to time.
7.5 ENTIRE AGREEMENT. This Agreement, the Exhibits and Schedules
hereto, the Agreements and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
7.6 SEVERABILITY. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
14.
18
7.7 AMENDMENT AND WAIVER. This Agreement may be amended or modified
only upon the written consent of the Company and the Purchaser and the
obligations of the Company and the rights of the Purchaser under the Agreement
may be waived only with the written consent of the Company and the Purchaser.
7.8 DELAYS OR OMISSIONS. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement, the Agreements
or the Restated Certificate, shall impair any such right, power or remedy, nor
shall it be construed to be a waiver of any such breach, default or
noncompliance, or any acquiescence therein, or of or in any similar breach,
default or noncompliance thereafter occurring. It is further agreed that any
waiver, permit, consent or approval of any kind or character on the Purchaser's
part of any breach, default or noncompliance under this Agreement, the
Agreements or under the Restated Certificate or any waiver on such party's part
of any provisions or conditions of the Agreement, the Agreements, or the
Restated Certificate must be in writing and shall be effective only to the
extent specifically set forth in such writing. All remedies, either under this
Agreement, the Agreements, the Restated Certificate, by law, or otherwise
afforded to any party, shall be cumulative and not alternative.
7.9 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address set forth on the signature page attached hereto or at
such other address as the Company or Purchaser may designate by ten (10) days
advance written notice to the other parties hereto.
7.10 EXPENSES. Each party shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement and the Agreements.
7.11 ATTORNEYS' FEES. In the event that any dispute among the parties
to this Agreement should result in litigation, the prevailing party in such
dispute shall be entitled to recover from the losing party all fees, costs and
expenses of enforcing any right of such prevailing party under or with respect
to this Agreement, including without limitation, such reasonable fees and
expenses of attorneys and accountants, which shall include, without limitation,
all fees, costs and expenses of appeals.
7.12 TITLES AND SUBTITLES. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
15.
19
7.13 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
7.14 BROKER'S FEES. Each party hereto represents and warrants that no
agent, broker, investment banker, person or firm acting on behalf of or under
the authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 7.14 being untrue.
7.15 SPECIFIC PERFORMANCE. Each party stipulates that the remedies at
law in the event of any default or threatened default by the other party in the
performance of or compliance with the terms of this Agreement are not and will
not be adequate and that, to the fullest extent permitted by law, such terms may
be specifically enforced by a decree for the specific performance of any
agreement contained herein or by an injunction against a violation of any of the
terms hereof.
16.
20
IN WITNESS WHEREOF, the parties hereto have executed the SERIES B
PREFERRED STOCK PURCHASE AGREEMENT as of the date set forth in the first
paragraph hereof.
COMPANY: PURCHASER:
XXX.XXX, INC. AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC.
By: /s/ Xxxx Xxxxxxx
-------------------------------
Title: President, AERS
----------------------------
By: /s/ Xxxx Street By:
------------------------------------ -------------------------------
Xxxx Street
Chairman of the Board, Chief Title:
Executive Officer and President ----------------------------
000 X. Xxxxx, Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000 Address: American Express Tower
Phone: (000) 000-0000 World Financial Center
(000) 000-0000 (facsimile) Xxx Xxxx, XX 00000
Attn: Vice President, New
Business
Development, AERS
Phone: 000-000-0000
Facsimile: 000-000-0000
17.
21
FIRST AMENDMENT TO SERIES B PREFERRED STOCK
PURCHASE AGREEMENT
This First Amendment to that certain Series B Preferred Stock Purchase
Agreement, dated as of April 8, 1997 (the "Purchase Agreement"), is entered into
as of the 10th day of October, 1997, by and between XXX.XXX, Inc., a Delaware
corporation (the "Company") and American Express Travel Related Services
Company, Inc. ("TRS").
WHEREAS, the Company and TRS entered into the Purchase Agreement
pursuant to which TRS, under certain circumstances, was granted a right of first
refusal to acquire the Company as set forth in Section 6.2 of the Purchase
Agreement; and
WHEREAS, in connection with the sale of the Company's Series C
Preferred Stock to certain investors pursuant to the terms of that certain
Series C Preferred Stock Purchase Agreement, to be dated on or about October 10,
1997 (the "Series C Purchase Agreement"), such investors have requested that the
right of first refusal be terminated in its entirety.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the undersigned parties hereby agree as follows:
1. Section 6.2 of the Purchase Agreement is deleted in its entirety and
has no further force or effect.
2. Except as set forth herein, the Purchase Agreement shall remain in
full force and effect.
3. This Amendment may be executed in any number of counterparts, each
of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned parties have executed this
Amendment as of the date set forth above.
XXX.XXX, INC. AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC.
By: /s/ Xxxx Street By: /s/ Xxxx Xxxxxxx
------------------------------------ -------------------------------
Xxxx Street Title: President, AERS
Chairman of the Board, ----------------------------
Chief Executive Officer and By:
President -------------------------------
Title:
----------------------------
22
SECOND AMENDMENT TO
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
This Second Amendment to that certain Series B Preferred Stock Purchase
Agreement, dated as of April 8, 1997, as amended on October 17, 1997 (the
"Purchase Agreement") is entered into as of March 23, 1998, by and between
XXX.XXX, INC., a Delaware corporation (the "Company") and AMERICAN EXPRESS
TRAVEL RELATED SERVICES COMPANY, INC. (the "Purchaser").
RECITALS
WHEREAS, the Company and the Purchaser entered into the Purchase
Agreement pursuant to which Purchaser purchased from the Company 527,579 shares
of the Company's Series B Preferred Stock;
WHEREAS, pursuant to Section 2.3 of the Purchase Agreement, Purchaser
has the option to purchase up to 527,579 shares of Series B Preferred Stock on
or before April 8, 1998;
WHEREAS, in accordance with Section 2.3 and Section 7.7 of the Purchase
Agreement, the Company and the Purchaser wish to enter into this Second
Amendment to make certain amendments to the Purchase Agreement and to permit
Purchaser to exercise its option to purchase additional shares of Series B
Preferred Stock of the Company.
In consideration of the mutual agreements, covenants and considerations
contained herein, the parties hereto agree as follows:
1. PURCHASE AND SALE; CLOSING
1.1 Subject to the terms and conditions hereof, and in reliance upon
the representations contained herein or incorporated by reference, the Company
hereby agrees to issue and sell to the Purchaser, and the Purchaser hereby
agrees to purchase from the Company 356,073 shares of Series B Preferred Stock
at a purchase price of Five Dollars and Sixty-Nine Cents ($5.69) per share (the
"Additional Shares"). The Company and Purchaser agree that the Schedule of
Purchasers shall be amended to read as set forth on Exhibit A hereto.
1.2 The closing of the sale and purchase of the Additional Shares (the
"Second Closing") shall take place on the date hereof at the offices of Xxxxxx
Godward LLP, 0000 Xxxxxx Xxxx., Xxxxx 000, Xxxxxxx, XX 00000, or at such other
time or place as the Company and the Additional Purchaser may mutually agree.
The Second Closing shall be held simultaneously with the closing of the sale and
issuance of an aggregate of 1,223,294 shares of the Company's Series C Preferred
Stock pursuant to that certain First Amendment to Series C Preferred Stock
Purchase Agreement. At the Second Closing, subject to the terms and conditions
hereof, the Company will deliver to the Purchaser a certificate representing the
number of Additional Shares purchased from the Company against payment by or on
behalf of the Purchaser of the purchase price therefor by wire transfer or check
made payable to the order of the Company.
1.
23
2. PURCHASE AGREEMENT
2.1 All capitalized terms used herein without definition shall have the
meanings ascribed to them in the Purchase Agreement.
2.2 The Purchase Agreement and the Schedule of Purchasers thereto are
hereby amended to provide that (i) the Purchaser makes, as of the Second
Closing, all representations and warranties therein, including, without
limitation, the representations and warranties in Section 4 of the Purchase
Agreement regarding investment intent, the Purchaser's qualifications and other
matters; (ii) the Additional Shares shall be deemed to be "Shares" for all
purposes under the Purchase Agreement; (iii) references in the Purchase
Agreement to the "Closing" shall be deemed to refer to the Second Closing for
purposes of the purchase of the Additional Shares hereunder.
2.3 The Company hereby represents and warrants to the Purchaser that
the representations and warranties of the Company made in Section 3 of the
Purchase Agreement are true and correct in all material respects as of the date
of the Second Closing except (i) as set forth on the updated Schedule of
Exceptions delivered to Purchaser, (ii) the references in such representations
to the unaudited financial statements of the Company at and as of February 28,
1997, and as to changes since such date shall be deemed to refer to the
unaudited financial statements of the Company as of December 31, 1997, and the
unaudited balance sheet and income statement for the month ended January 31,
1998, copies of which are attached hereto as Exhibit B, and to changes as of
January 31, 1998 and (iii) references in such representations to dollar values
of $25,000 and $75,000 shall be deemed to refer to dollar values of $50,000 and
$100,000.
2.4 Notwithstanding Section 6.1 of the Purchase Agreement, the Company
and Purchaser hereby agree that the Company shall use one-third (1/3) of the
proceeds from the sale of the Additional Shares for the purposes set forth in
Section 2(d) of the Marketing Agreement.
3. CONDITIONS TO ADDITIONAL OBLIGATIONS AT THE SECOND CLOSING. In lieu of
the conditions of the Purchaser's obligations at the Second Closing set forth in
Section 5 of the Purchase Agreement, the Purchaser's obligations to purchase the
Additional Shares at the Second Closing are subject to the satisfaction, at or
prior to the Second Closing, of the following conditions:
3.1 REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF OBLIGATIONS.
The representations and warranties made by the Company in Section 3 of the
Purchase Agreement shall be true and correct in all material respects as of the
Second Closing with the same force and effect as if they had been made on such
date, and the Company shall have performed all obligations and conditions herein
required to be performed or observed by it on or prior to the Second Closing.
3.2 LEGAL INVESTMENT. On the date of the Second Closing, the sale and
issuance of the Additional Shares and the proposed issuance of the Conversion
Shares shall be legally
2.
24
permitted by all laws and regulations to which the Purchaser and the Company are
subject, and no action is pending seeking to prevent such sale and issuance.
3.3 CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained any
and all consents, permits and waivers necessary or appropriate for consummation
of the transactions contemplated by the Purchase Agreement and the Agreements
(except for such as may be properly obtained subsequent to the Second Closing).
3.4 CORPORATE DOCUMENTS. The Company shall have delivered to the
Purchaser or its counsel copies of all corporate documents of the Company as the
Purchaser shall reasonably request.
3.5 RESERVATION OF CONVERSION SHARES. The Conversion Shares issuable
upon conversion of the Shares shall have been duly authorized and reserved for
issuance upon such conversion.
3.6 COMPLIANCE CERTIFICATE. The Company shall have delivered to the
Purchaser a Compliance Certificate, executed by the President of the Company,
dated the date of the Second Closing, to the effect that the conditions
specified in Section 3.1 hereof have been satisfied and that the Company has
issued and sold a sufficient number of shares of Series C Preferred Stock
pursuant to the First Amendment to the Series C Preferred Stock Purchase
Agreement such that, after giving effect to the sale of the Additional Shares
hereunder, Purchaser shall own less than twenty percent (20%) of the outstanding
capital stock of the Company.
3.7 LEGAL OPINION. The Purchaser shall have received from legal counsel
to the Company an opinion addressed to it, dated as of the Second Closing, in
substantially the form rendered at the Initial Closing.
3.8 NO MATERIAL ADVERSE CHANGE. There shall have been no material
adverse change in the business, affairs, prospects, operations, properties,
assets or condition of the Company since January 31, 1998.
3.9 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at the Second Closing hereby and
all documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the Purchaser and its special counsel, and
the Purchaser and its special counsel shall have received all such counterpart
originals or certified or other copies of such documents as they may reasonably
request.
4. COUNTERPARTS. This Second Amendment may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
5. OTHER TERMS AND CONDITIONS. All other terms and conditions of the
Purchase Agreement shall remain in full force and effect.
3.
25
[REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
4.
26
IN WITNESS WHEREOF, the parties hereto have executed this SECOND
AMENDMENT TO THE SERIES B PREFERRED STOCK PURCHASE AGREEMENT as of the date set
forth in the first paragraph hereof.
COMPANY: PURCHASER:
XXX.XXX, INC. AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC.
By: /s/ Xxxx X. Street By: /s/ Xxxxx Xxxxxxxx
---------------------------------------------- -----------------------------------
Xxxx X. Street
Chairman of the Board, Chief Executive Title: Vice President
Officer and President --------------------------------
0000 Xxxxx Xxxxxxx Xxxx., Xxxxx 000 By:
Xxxxxxxx Xxxxxxx, XX 00000 -----------------------------------
Phone: (000) 000-0000 Title:
Facsimile: (000) 000-0000 --------------------------------
ADDRESS:
American Express Tower
World Financial Center
Xxx Xxxx, XX 00000
Attn: Vice President, New Business
Development, AERS
Phone: (000) 000-0000
Facsimile: (000) 000-0000
5.