================================================================================
COMMON STOCK PURCHASE AGREEMENT
BETWEEN
SARATOGA HOLDINGS I, INC.
(THE COMPANY)
AND
SARATOGA RESOURCES, INC.
(RESOUIRCES)
DATED AS OF APRIL 29, 2002
================================================================================
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (this "Agreement") is made and entered into
as of April 29, 2002 (the "Effective Date"), between Saratoga Holdings I, Inc.
(the "Company"), a Texas corporation, and Saratoga Resources, Inc.
("Resources"), a Texas corporation.
Background
Reference is made to that certain Exchange Agreement dated as of April 18, 2002
(the "Exchange Agreement"), among the Company, Xxxxxx X. Xxxxx, SH2, Inc., a
Delaware corporation wholly-owned by the Company ("SH2"), A21 Acquisition LLC, a
Delaware limited liability company wholly-owned by the Company ("A21
Acquisition"), Agence 21, Inc., ("A21") and the sellers of outstanding
securities of A21 who sign the Exchange Agreement (the "Sellers"), pursuant to
which, among other things, the Sellers have agreed to exchange their outstanding
securities of A21 for common stock options and warrants of the Company owned by
A21 Acquisition in a transaction intended for federal income tax purposes to
qualify as an exchange described in section 351 of the Internal Revenue Code of
1986 (the "Code") and a reorganization described in section 368 of the Code.
Capitalized terms used herein without definition have the respective meanings
assigned to such terms in the Exchange Agreement.
Pursuant to the Exchange Agreement, the Company has authorized the sale and
delivery of all of the 1,000 shares, par value $0.001 per share, (the "Shares")
it owns of SH2, in exchange for the forgiveness of One Hundred and Thirty Five
Thousand Dollars ($135,000) the Company owes to Resources for rent commencing
January 2000 and ending the date hereof, and the assumption by Resources of all
other liabilities of the Company outstanding as of the Effective Date
immediately before giving effect to the Exchange other than the Permitted
Liabilities (the "Debt").
Resources is acquiring and will acquire, as the case may be, the Shares solely
for its own account for investment purposes only and not with a view toward
resale or distribution thereof other than pursuant to an effective registration
statement or applicable exemption from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act").
Agreement
For and in consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and Resources hereby agree as
follows:
Section 1. Shares.
Section 1.1. Sale of the Shares
The Company agrees to sell the Shares to Resources and Resources agrees
to purchase the Shares from the Company for its own account, at the
Closing, for the forgiveness and/or assumption of the Debt by
Resources.
Section 1.2. Closing.
The closing of the purchase and sale of the Shares shall take place at
the offices of Xxxxxxx Xxxxxxxx Xxxxx Xxxxxxxxxxx & Kuh, LLP; 000 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 3:00 p.m., Eastern
Time, on Wednesday, May 1, 2002, or at such other location or time as
the parties may agree (the "Closing").
1
Section 1.3. Deliveries at Closing
At the Closing the Company shall deliver to Resources the Shares, which
shall represent all of the issued and outstanding shares of SH2,
together with a duly executed stock power.
Section 2. Resources' Representations and Warranties
Resources represents and warrants to the Company that:
Section 2.1. Investment Purpose
Resources is acquiring and will acquire, as the case may be, the Shares
solely for its own account for investment purposes only and not with a
view toward resale or distribution thereof other than pursuant to an
effective registration statement or applicable exemption from the
registration requirements of the Securities Act. Resources understands
that such Shares will be sold in reliance upon an exemption from the
registration requirements of the Securities Act and that subsequent
sale or transfer of such securities is prohibited absent registration
or exemption from the provisions of the Securities Act. Resources
hereby agrees that it will not sell, assign, transfer, pledge or
otherwise convey any of the Shares, except in compliance with the
provisions of the Securities Act and in accordance with any transfer
restrictions or similar terms set forth on the certificates
representing such securities or otherwise set forth herein.
Section 2.2. Indebtedness
The Debt represents all of the liabilities of the Company as of the
Effective Date, other than the Permitted Liabilities, immediately
before giving effect to the Exchange.
Section 3. Representations And Warranties Of The Company
The Company represents and warrants to Resources that, on the Closing
Date, the Shares will represent all of the issued and outstanding
shares of SH2.
Section 4. Expenses
Each party hereto shall pay its own expenses incurred in connection
with this Agreement and the transactions contemplated hereby.
Section 5. General Provisions
Section 5.1. Governing Law
This Agreement shall be governed by and interpreted in accordance with
the laws of the State of Delaware without giving effect to conflicts of
law principles thereunder).
Section 5.2. Counterparts
This Agreement may be executed in two or more identical counterparts,
all of which shall be considered one and the same agreement and shall
become effective when counterparts have been signed by each party and
delivered to the other party.
2
Section 5.3. Headings
The headings of this Agreement are for convenience of reference and
shall not form part of, or affect the interpretation of, this
Agreement.
Section 5.4. Severability
If any provision of this Agreement shall be invalid or unenforceable in
any jurisdiction, such invalidity or unenforceability shall not affect
the validity or enforceability of the remainder of this Agreement in
that jurisdiction or the validity or enforceability of any provision of
this Agreement in any other jurisdiction.
Section 5.5. Entire Agreement, Amendments
This Agreement supersedes all other prior oral or written agreements
between Resources and the Company, and their respective affiliates and
persons acting on their behalf with respect to the sale of the Shares,
this Agreement and the matters covered hereby. No provision of this
Agreement may be waived or amended other than by an instrument in
writing signed by the party to be charged with enforcement.
Section 5.6. Successors and Assigns
This Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors and assigns. Neither party
hereto shall assign this Agreement or any rights or obligations
hereunder without the prior written consent of the other party.
Section 5.7. No Third Party Beneficiaries
This Agreement is intended for the benefit of the parties hereto and
their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other
person.
Section 5.8. Survival
Unless this Agreement is terminated under Section 5.10, the
representations and warranties of the Company and Resources contained
in Sections 2 and 3, the agreement and covenant set forth in Section 4,
shall survive the Closing.
Section 5.9. Further Assurances
Each party hereto shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments, and
documents, as the other party may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
Section 5.10. Termination
In the event that the Exchange shall not have been consummated on the
Effective Date either party shall have the option to terminate this
Agreement by giving written notice of termination to the other party,
in which event this Agreement shall become null and void.
3
Section 5.11. No Strict Construction
The language used in this Agreement will be deemed to be the language
chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.
IN WITNESS WHEREOF, the Company and Resources have caused this Common
Stock Purchase Agreement to be duly executed as of the date first written above.
SARATOGA HOLDINGS I, INC. SARATOGA RESOURCES, INC.
By: /s/ XXXXXX X. XXXXX By: /s/ XXXXXX X. XXXXX
-------------------------- --------------------------
Xxxxxx X. Xxxxx, President Xxxxxx X. Xxxxx, President
4
