FIRST AMENDMENT OF STOCK PURCHASE AGREEMENT
Exhibit 2.1
FIRST AMENDMENT OF
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT
This First Amendment of Stock Purchase Agreement (“First Amendment”) is made and
entered into as of January 1, 2008, by and among Coinstar E-Payment Services Inc., a Kansas
corporation (“Buyer”), Xxxx Xxxxxxxxx Xxxx (“Xxxx”), an individual residing in Las
Vegas, Nevada, Xxxxxxxx Xxxxx (“Xxxxx”), an individual residing in Edina, Minnesota, Xxxxxx
Xxxxxxx (“Xxxxxxx”), an individual residing in La Habra, California, Xxxxx Xxxxxx Xxxxxxxx
(“Xxxxxxxx”), an individual residing in Placentia, California, Xxxxx Xxxx (“Mard”),
an individual residing in Pasadena, California, and Xxxxxx Xxxxx (“Xxxxx”), an individual
residing in Pasadena, California. Leon, Knoll, Xxxxxxx, Xxxxxxxx, Mard and Xxxxx are sometimes
referred to collectively as “Seller.”
RECITALS
A. On July 19, 2007, Buyer and Seller entered into a Stock Purchase Agreement (such agreement,
the “Stock Purchase Agreement”).
B. The purpose of this First Amendment is to set forth the terms and conditions upon which
Buyer and Seller will modify the terms of the Stock Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions set forth herein, the
parties agree as follows:
1. AMENDMENT; DEFINITIONS
1.1 Amendment
The Stock Purchase Agreement is amended as set forth herein. Except as specifically provided
for in this First Amendment, all of the terms and conditions of the Stock Purchase Agreement and
each of the other documents related to the Stock Purchase Agreement shall remain in full force and
effect.
1.2 Definitions
Capitalized terms shall have the meanings given to them in the Stock Purchase Agreement,
except as otherwise defined in this First Amendment.
2. AMENDMENT TO ARTICLE I, SECTION (e)
Article I, Section (e) of the Stock Purchase Agreement is hereby amended by deleting the
definitions of “Escrow Amount” and “Escrow Agreement” in their entirety and by
adding the following definitions:
“Escrow Agreement A” has the meaning set forth in Section 2.2(b)(i).
“Escrow Amount A” has the meaning set forth in Section 2.2(b)(i).
“Escrow Agreement B” has the meaning set forth in Section 2.2(b)(ii).
“Escrow Amount B” has the meaning set forth in Section 2.2(b)(ii).
“Lawsuits” has the meaning set forth in Section 9.1(c).”
3. AMENDMENT TO SECTION 2.2(a)
Section 2.2(a) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“(a) Closing Payment. An amount of cash equal to the Purchase Price (i) less an
amount equal to Seller’s unpaid Transaction Costs, (ii) less an amount equal to all of Seller’s
Closing Indebtedness, (iii) less an amount equal to Escrow Amount A, (iv) less an amount equal to
Escrow Amount B and (v) less an amount equal to the maximum potential Contingent Payment (which is
Ten Million Dollars ($10,000,000.00)), shall be paid by Buyer by wire transfer at the Closing as
set forth on Schedule 2.2(a).”
4. AMENDMENT TO SECTION 2.2(b)
Section 2.2(b) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“(b) Escrow Payments. (i) An amount of cash equal to Six Million Dollars
($6,000,000.00) (such amount, “Escrow Amount A”) shall be paid by Buyer by wire transfer at
the Closing to JPMorgan Chase Bank, N.A. as escrow agent (the “Escrow Agent”), which Escrow
Amount A will be held and disbursed pursuant to the terms of an escrow agreement in the form of
Exhibit 2.2(b)(i) hereto (“Escrow Agreement A”); and (ii) an additional amount of
cash equal to Thirty Four Million Dollars ($34,000,000) (such additional amount, “Escrow Amount
B”) shall be paid by Buyer by wire transfer at the Closing to Escrow Agent, which Escrow Amount
B will be held and disbursed pursuant to the terms of an escrow agreement in the form of
Exhibit 2.2(b)(ii) hereto (“Escrow Agreement B”).”
5. AMENDMENT TO SCHEDULE 2.2(d)
Schedule 2.2(d) to the Stock Purchase Agreement is hereby deleted in its entirety and
replaced with Schedule 2.2(d) attached to this First Amendment.
6. AMENDMENT TO EXHIBIT 7.2(b)
Exhibit 7.2(b) to the Stock Purchase Agreement is hereby deleted in its entirety,
replaced with Exhibit 2.2(b)(i) attached to this First Amendment and retitled Exhibit
2.2(b)(i).
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7. ADDITION OF EXHIBIT 2.2(b)(ii)
Exhibit 2.2(b)(ii) to the Stock Purchase Agreement shall be the same as Exhibit
2.2(b)(ii) attached to this First Amendment.
8. AMENDMENT TO SECTION 2.2(d)(iv)
Section 2.2(d)(iv) of the Stock Purchase Agreement is hereby deleted in its entirety and
replaced with the following:
“(iv) Each Final Contingent Payment, if any, shall be paid by Buyer within thirty (30) days of
the end of the Measurement Period as follows: (A) if the final distribution of all amounts held by
Escrow Agent pursuant to the terms of Escrow Agreement B has not occurred as of such payment date,
to Escrow Agent by wire transfer to be held and disbursed pursuant to the terms of Escrow Agreement
B; and (B) if the final distribution of all amounts held by Escrow Agent pursuant to the terms of
Escrow Agreement B has occurred as of such payment date, to Seller in cash as directed by the
Stockholder Agent. Notwithstanding anything in this Agreement or elsewhere to the contrary, if a
Qualifying Termination occurs with respect to a Separated Employee prior to the Closing Date, the
Qualifying Termination shall be deemed to occur on the Closing Date.”
9. AMENDMENT TO SELLER DISCLOSURE SCHEDULE
Schedule 2.2(d)
and Sections 3.2, 3.3(d), 3.8 and 3.9 of the Seller Disclosure Schedule are hereby deleted in
their entirety and replaced with the schedule of the corresponding Section number attached to this
First Amendment.
10. AMENDMENT TO SECTION 3.13
Section 3.13 of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“3.13 Permits.
Each Company Constituent Entity holds all applicable Permits that are required by any
Governmental Entity to permit such Company Constituent Entity to conduct its respective business as
now conducted in all material respects, and all such Permits are valid and in full force and effect
and will remain so upon consummation of the transactions contemplated by this Agreement. For the
five years preceding the date of this Agreement, each Company Constituent Entity held all
applicable Permits that were required by any Governmental Entity to permit such Company Constituent
Entity to conduct its respective business as then conducted in all material respects, and all such
Permits were valid and in full force and effect during such period. Except as otherwise disclosed
in Schedule 3.9, no suspension, cancellation, termination or allegation of violation of the
terms of any Permits that are required by any Governmental Entity to permit each Company
Constituent Entity to conduct its business as now conducted in all material respects is threatened
or imminent.
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11. AMENDMENT TO SECTION 3.14
Section 3.14 of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“3.14 Compliance with Law.
Each Company Constituent Entity is organized and conducts, and for the five years preceding
the date of the Agreement has conducted, its business in all material respects in accordance with
applicable Laws, and the forms, procedures and practices of such Company Constituent Entity are,
and for the five years preceding the date of the Agreement have been, in all material respects in
compliance with all such Laws, to the extent applicable. Compliance with Laws includes, without
limitation, compliance with Laws relating to money-laundering, the USA Patriot Act, the Bank
Secrecy Act, Office of Foreign Assets Control requirements, the Xxxxx-Xxxxx-Xxxxxx Act, state money
transmitter, sale of check and banking laws, state escheat and unclaimed property laws, wages,
hours, collective bargaining, withholding Taxes, employee health and benefits, the Immigration
Reform & Control Act of 1986 and ERISA.”
12. ADDITION OF SECTION 6.9
“6.9 Litigation Support.
In the event and for so long as Seller is actively contesting or defending against any
actions, suits, proceedings, hearings, investigations, charges, complaints, claims, or demands
related to the Lawsuits, Buyer shall provide reasonable access to and, if requested, copies of the
books and records of the Company Constituent Entities to the extent necessary to contest or defend
the Lawsuits; provided, however, that such books and records and the information contained therein
shall be kept confidential by Seller and its representatives and shall not be used by any Persons
other than as contemplated by this Section 6.9. If Seller or its representatives are requested or
required to disclose any of such books or records or information therein to a third party, Seller
shall provide Buyer with prompt written notice of any such request or requirement so that Buyer may
seek a protective order or other appropriate remedy and/or waive compliance with the provisions of
this Section 6.9. If, in the absence of a protective order or other remedy or the receipt of a
waiver from Buyer, the Seller or its representatives are nonetheless, in the written opinion of the
Seller’s counsel, legally compelled by any Governmental Entity to disclose such information or be
liable for contempt or other penalty, Seller or its representative may, without liability
hereunder, disclose to such Governmental Entity only that portion of such information which such
counsel advises the Seller is legally required to be disclosed, provided that the Seller exercises
commercially reasonable efforts to preserve the confidentiality of such information, including,
without limitation, by cooperating with Buyer to obtain an appropriate protective order or other
reliable assurance that confidential treatment will be accorded the information. Notwithstanding
anything in this Section 6.9 to the contrary, Buyer hereby waives compliance with this Section 6.9
for any disclosure by Seller or its representatives of any
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books and records and other information that is made on the basis that such information is
“CONFIDENTIAL” or “CONFIDENTIAL—ATTORNEYS’ EYES ONLY” in compliance with the terms and conditions
of the “Stipulation and Protective Order Governing the Use and Maintenance of Confidential
Material” that was entered on November 28, 2007 by the Los Angeles Superior Court in connection
with the Lawsuits. Further, Buyer shall make available or cause to be made available on a
reasonable basis any personnel of Buyer or the Company Constituent Entities needed to explain such
books and records or to provide information necessary to contest or defend the Lawsuits. Seller
shall reimburse Buyer for its reasonable out-of-pocket costs in providing the foregoing
assistance.”
13. AMENDMENT TO SECTION 7.2(b)
Section 7.2(b) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“(b) Escrow Agreements. Seller shall have delivered to Buyer each of Escrow Agreement
A and Escrow Agreement B, duly executed by Seller and by the Escrow Agent, substantially in the
respective forms attached as Exhibit 2.2(b)(i) and Exhibit 2.2(b)(ii) hereto.”
14. AMENDMENT TO EXHIBITS 7.2(f) AND 7.2(g)
Each of Exhibits 7.2(f) [Agency Services Agreement] and 7.2(g) [Software
License Agreement] to the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the Exhibit of the corresponding number attached to this First Amendment.
15. AMENDMENT TO SECTION 7.2(i)
Section 7.2(i) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“(i) Lease Extension; Ownership. (A) The real estate lease dated February 1, 2005
between Mexico Express and Eagle Properties, LLC (“Eagle”) for the premises occupied by GFC
in La Mirada, California (the “Primary Lease”) shall have been extended or replaced in the
name of GFC as tenant through January 31, 2010 on terms and conditions substantially the same as
those contained in the Primary Lease; provided, however, that GFC shall have the right under the
lease as extended to terminate such lease without penalty upon six (6) months prior written notice
to Eagle (B) At Closing, Xxxx shall be the sole equity-holder of Eagle, and no other Person shall
have any ownership interest in Eagle, including but not limited to any membership interests, units,
profits interests, options, warrants, calls, commitments, conversion rights, rights of exchange,
plans or other arrangements of any character or right to acquire Equity Securities or any other
interest in Eagle.”
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16. ADDITION OF SECTION 7.2(p)
Section 7.2 of the Stock Purchase Agreement is hereby amended by adding the following as new
Section 7.2(p):
“(p) At Closing, The Xxxx Family Trust U/D/T September 11, 1997 shall be the sole
equity-holder of CompreMex, and no other Person shall have any ownership interest in CompreMex,
including but not limited to any membership interests, units, profits interests, options, warrants,
calls, commitments, conversion rights, rights of exchange, plans or other arrangements of any
character or right to acquire Equity Securities or any other interest in CompreMex.”
17. AMENDMENT TO SECTION 7.3(f)
Section 7.3(f) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“(f) Escrow Agreements. Buyer shall have delivered to Seller each of Escrow Agreement
A and Escrow Agreement B, duly executed by Buyer and by the Escrow Agent, substantially in the
respective forms attached as Exhibit 2.2(b)(i) and Exhibit 2.2(b)(ii) hereto.”
18. AMENDMENT TO SECTION 9.1
Section 9.1 of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“9.1 Obligation of Seller.
Xxxx individually, on behalf of himself and each other Person included within the definition
of Seller, hereby agrees to indemnify Buyer and its Affiliates, and hold harmless each of Buyer and
such Affiliates, from, against and in respect of any and all Losses arising from any of the
following:
(a) any inaccuracy in or breach of any of the representations and warranties made by Seller in
or pursuant to Article 3 of this Agreement;
(b) the nonperformance of any obligations or agreements of Seller under this Agreement;
(c) notwithstanding anything to the contrary in this Agreement, (i) any and all claims,
actions, charges, causes of action, demands, prayers for relief or similar claims that were or are
asserted in the lawsuits described in Schedule 3.9 (the “Lawsuits”), or that arise
out of, concern or relate to any subject matter of the Lawsuits, and (ii) any and all claims,
actions, charges, causes of action, demands, prayers for relief or similar claims that conflict
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with or are inconsistent with the representations and warranties made in Sections 3.1 and 3.2
of the Agreement.
Buyer hereby acknowledges and agrees that only Xxxx, and no other Seller, shall have any liability
for indemnification for Losses arising from any of the foregoing. For purposes of illustrating the
intent of the parties with respect to the indemnification provisions hereunder, examples of certain
potential indemnification obligations are attached hereto as Schedule 9.1.”
19. AMENDMENT TO SECTION 9.4
Section 9.4 of the Stock Purchase Agreement is hereby deleted in its entirety and replaced
with the following:
“9.4 Monetary Limitations on Indemnification.
Xxxx individually, on behalf of himself and each other Person included within the definition
of Seller, shall not have any liability for indemnification to Buyer under Section 9.1(a) unless
the aggregate of all Losses related thereto for which Xxxx individually, on behalf of himself and
each other Person included within the definition of Seller, would, but for this provision, be
liable exceeds, on an aggregate basis, Three Hundred Thousand Dollars ($300,000), as finally
determined (the “Basket Amount”); provided, however, that once aggregate
Losses exceed the Basket Amount, Xxxx shall indemnify Buyer and its Affiliates for all of such
Losses without regard to the Basket Amount; provided, further, that in no event
shall Xxxx individually, on behalf of himself and each other Seller, have an aggregate liability in
excess of Six Million Dollars ($6,000,000.00), as finally determined as a result of any and all
Claims for Losses resulting from an inaccuracy or breach under Section 9.1(a) of this Agreement,
except to the extent based on (A) Losses arising from any inaccuracy in or breach of the
representations and warranties made by Seller in or pursuant to Section 3.13 [Permits] or Section
3.14 [Compliance with Law], for which Xxxx individually, on behalf of himself and each other
Seller, shall have a maximum liability equal to (i) for claims made or reserved as Reserved Claims
in the eighteen (18) months following the Closing Date, an aggregate amount equal to Sixteen
Million Dollars ($16,000,000.00) inclusive of all amounts paid to Buyer and its Affiliates pursuant
to indemnification under Section 9.1(a) hereof and (ii) for claims made or reserved as Reserved
Claims during the period from eighteen (18) months following the Closing Date through three (3)
years following the Closing Date, an aggregate amount equal to Eight Million Dollars
($8,000,000.00) inclusive of all amounts paid to Buyer and its Affiliates pursuant to
indemnification under Section 9.1(a) hereof, (B) (i) fraud (defined to include, at a minimum,
intent to deceive) or (ii) claims related to a breach of Section 3.2 [Stock] or Section 3.8 (first
sentence only) [Authorization; No Conflicts], for which there shall be no limit to Leon’s aggregate
liability; and (C) claims under Section 9.1(c) of this Agreement, for which Xxxx individually, on
behalf of himself and each other Seller, shall have a maximum liability equal to the sum of (i)
Escrow Amount B, including any interest thereon pursuant to Escrow Agreement B, plus (ii) the full
amount of the Contingent Payment payable, if any. It is agreed by the Parties, however, that
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the Basket Amount shall in no event apply to claims related to a breach of Section 3.1
[Organization and Related Matters], Section 3.2 [Stock], Section 3.4 [Tax and Other Returns and
Reports], Section 3.8 (first sentence only) [Authorization; No Conflicts], Section 3.16 [Employee
Benefits] or Section 3.20 [No Brokers or Finders]. Buyer hereby acknowledges and agrees that only
Xxxx, and no other Seller, shall have any liability for indemnification for Losses arising from any
of the foregoing. Any indemnification obligations of Xxxx under Sections 9.1(a) and 9.1(b) of this
Agreement shall first be satisfied by the funds in the escrow fund pursuant to the terms of Escrow
Agreement A. Any indemnification obligations of Xxxx under Section 9.1(c) of this Agreement shall
be satisfied exclusively from (i) the funds in the escrow fund pursuant to the terms of Escrow
Agreement B and (ii) by offsetting amounts, if any, otherwise payable with respect to the
Contingent Payment. To that extent that a Claim for indemnification could arguably be made by
Buyer and its Affiliates under either Section 9.1(a) or 9.1(c), the Parties hereby agree that Buyer
and its Affiliates shall be entitled to make such Claim under either Section 9.1(a) or 9.1(c), or
both, at Buyer and its Affiliates’ sole discretion; provided, however, that such Claim shall be
subject to the respective terms and conditions of Section 9.1(a) or 9.1(c), as applicable, and that
Buyer and its Affiliates shall in no event be entitled to recover duplicate amounts for Losses
hereunder.”
20. ADDITION TO SECTION 6.6(e)
In Section 6.6(e) of the Stock Purchase Agreement, following the words “In addition,” the
phrase “subsequent to the Closing Date,” is added.
21. ADDITION TO SECTION 6.7(b)
In Section 6.7(b) of the Stock Purchase Agreement, following the words “For each of the
CompreMex Leases on Schedule 6.7(a) to which any Company Constituent Entity is a party,”
the phrase “subsequent to the Closing Date,” is added.
22. ADDITION TO SECTION 6.7(c)
In Section 6.7(c) of the Stock Purchase Agreement, following the words “In the event that” the
phrase “after the Closing Date,” is added.
23. AMENDMENT TO SECTION 7.3(a)(ii)
In Section 7.3(a)(ii) of the Stock Purchase Agreement, in lines 10 to 12 the phrase “(provided
that any obligation, covenant or condition of Seller contained herein that is qualified by a
materiality standard shall not be further qualified hereby)” shall be deleted, and the phrase
“(provided that any obligation, covenant or condition of Buyer contained herein that is qualified
by a materiality standard shall not be further qualified hereby)” is added in its place.
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24. NOTICES
In Section 10.2 of the Stock Purchase Agreement, the zip code of Xxxx Xxxxxxxxx Xxxx is
deleted in its entirety and replaced with the following: “89052-7084.”
25. COUNTERPARTS
This First Amendment may be executed in one or more counterparts, each of which shall
constitute an original agreement, but all of which together shall constitute one and the same
agreement.
26. GOVERNING LAW
This First Amendment, the legal relations between the Parties and any Action, whether
contractual or non-contractual, instituted by any Party with respect to matters arising under or
growing out of or in connection with or in respect of this First Amendment or the Stock Purchase
Agreement shall be governed by and construed in accordance with the laws of the State of Delaware
(excluding the choice of law provisions thereof) except to the extent that certain matters are
preempted by federal law.
Each Party hereto irrevocably submits to and accepts for itself and its properties, generally
and unconditionally, the exclusive jurisdiction of and service fo process pursuant to the laws of
the State of Delaware and the rules of its courts, waives any defense of forum non conveniens and
agrees to be bound by any judgment rendered thereby arising under or out of in respect of or in
connection with this First Amendment, the Stock Purchase Agreement or any related document or
obligation.
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IN WITNESS WHEREOF, Buyer and Seller have caused this First Amendment to be duly executed as
of the date first written above.
| SELLER: | BUYER: | |||
| /s/ Xxxx Xxxxxxxxx Xxxx | COINSTAR E-PAYMENT SERVICES, INC. | |||
| Xxxx Xxxxxxxxx Xxxx | ||||
| /s/ Xxxxxxxx Xxxxx | By: | /s/ Xxxxxxx X. Xxxxxxx | ||
| Xxxxxxxx Xxxxx | Its: | President | ||
| /s/ Xxxxxx Xxxxxxx | ||||
| Xxxxxx Xxxxxxx | ||||
| /s/ Xxxxx Xxxxxx Xxxxxxxx | ||||
| Xxxxx Xxxxxx Xxxxxxxx | ||||
| /s/ Xxxxx Xxxx | ||||
| Xxxxx Xxxx | ||||
| /s/ Xxxxxx Xxxxx | ||||
| Xxxxxx Xxxxx | ||||
To the extent that the undersigned has any right, title or interest in the Stock, the undersigned
shall be included as a Seller and shall transfer all of its right, title and interest in the Stock in accordance with the terms of the Stock Purchase Agreement:
| THE XXXX FAMILY TRUST U/D/T SEPTEMBER 11, 1997 |
||||
| /s/ Xxxx X. Xxxx | ||||
| Xxxx X. Xxxx | ||||
| Trustee | ||||
[SIGNATURE
PAGE TO FIRST AMENDMENT OF STOCK PURCHASE AGREEMENT]
Certain exhibits and schedules in connection with the Stock Purchase Agreement have been
omitted pursuant to Item 601(b)(2) of Regulation S-K. Coinstar, Inc. agrees to provide the
Securities and Exchange Commission a copy of any such exhibit or schedule upon request.
