Exhibit A
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement"), is entered into as of
January 29, 1998, by and between Xxxx Communications, Inc., a Delaware
corporation (the "Company") and the Purchaser named on the signature page
hereto (the "Purchaser"). The parties agree that the effective date of this
Agreement, to the extent practicable, shall be deemed January 1, 1998.
The Company has offered for sale, pursuant to Section 4(2) and/or
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), to the Purchaser shares of the Common Stock (the "Common
Stock") of the Company.
The parties hereto agree as follows:
1. Purchase and Sale of Shares. On the basis of the representations and
warranties, and subject to the terms and conditions, set forth in this
Agreement, the Company covenants and agrees to issue and sell to the
Purchaser on the Closing Date (as hereinafter defined), 1,100,000 shares of
its Common Stock (the "Shares") in consideration for all of the issued and
outstanding shares of capital stock (the "VV Shares") of VECTOR VISION, Inc.
("VV") owned by the Purchaser (the "Consideration"), and on the basis of the
representations and warranties, and subject to the terms and conditions, set
forth in this Agreement, the Purchaser covenants and agrees to purchase the
Shares from the Company on the Closing Date.
The parties hereby acknowledge that VV owns forty-five percent (45%) of
the joint venture interests in MovieBar USA/VectorVision ("MOVIE VISION"). The
remaining joint venture interests in MOVIE VISION are owned by other parties
who, it is contemplated, will enter into separate agreements with the Company
regarding their joint venture interests in MOVIE VISION contemporaneously
with the signing of this Agreement.
2. Closing. The settlement of the purchase and sale of the Shares
hereunder (the "Closing") shall take place on the second business day after
the date hereof (the "Closing Date"), or such other date as the parties
hereto shall mutually agree. At the Closing, a certificate or certificates in
definitive form representing the Shares and registered in the name of the
Purchaser (or as the Purchaser may direct) shall be delivered by the Company
to the Purchaser at the offices of the Purchaser in Hingham, Massachusetts,
(or at such other place as the Purchaser may direct) and the Purchaser shall
deliver the Consideration with all appropriate stock powers necessary to
transfer the VV Shares to the Company.
3. Representations, Warranties and Certain Covenants of the Purchaser. The
Purchaser represents and warrants to the Company as follows:
(a) (i) Except as set forth below, the Purchaser is the registered and
beneficial owner of the VV Shares; (ii) the VV Shares are the only shares
of capital stock or securities of VV owned by the Purchaser, and the VV
Shares represent all of the issued and outstanding capital stock of VV;
and (iii) the VV shares are held by the Purchaser free and clear of all
liens, charges, security interests, restrictions on transfer (other than
any restrictions under the Securities Act and state securities laws),
taxes, options, warrants, purchase rights, contracts, commitments,
equities, claims, demands and other adverse rights or claims of third
parties. The Purchaser is not a party to any voting trust, proxy or other
agreement with respect to the voting of any of the VV Shares.
(b) This Agreement constitutes the Purchaser's valid and legally
binding obligation, enforceable in accordance with its terms and the
execution, delivery and performance of the terms of this Agreement will
not violate any provision of the Bylaws or Certificate of Incorporation
of VV.
(c) The Purchaser acknowledges that, in making the decision to
purchase the Shares, he has relied solely upon independent investigations
made by him and not upon any representations made by the Company with
respect to the Company or the Shares, except for the representations and
warranties of the Company with respect to the Company and/or the Shares
contained in this Agreement.
(d) The Purchaser understands that the Shares are being offered and
sold to it in reliance on specific exemptions from the registration
requirements of Federal and state securities laws and that the Company
is relying, in part, upon the truth and accuracy of the representations,
warranties, agreements, acknowledgements, and understandings of the
Purchaser set forth herein in order to determine the applicability of
such exemptions and the suitability of the Purchaser to acquire the
Shares.
(e) The Purchaser, who resides in The Commonwealth of Massachusetts,
is an "accredited investor" within the meaning of Rule 501 of Regulation
D under the Securities Act and was not organized for the specific purpose
of acquiring the Shares.
(f) The Purchaser has sufficient knowledge and experience in investing
in companies similar to the Company so as to be able to evaluate the
risks and merits of its investment in the Company and it is able
financially to bear the risks thereof.
(g) The Purchaser has had an opportunity to discuss the Company's
business, management and financial affairs with the Company's management
and to make inquiries of the Company's management concerning all matters
which the Purchaser deems relevant to its decision to purchase the
Shares, and the Purchaser has received satisfactory answers to all such
inquiries.
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(h) The Shares are being acquired by the Purchaser for his own account
for the purpose of investment and not with a view to or for sale in
connection with any distribution thereof.
(i) The Purchaser is aware that the Shares have not been registered
under the Securities Act and may only be offered or sold by the Purchaser
pursuant to registration under the Securities Act or an available
exemption therefrom.
(j) To the Purchaser's knowledge, he has (and at the Closing will have)
disclosed in writing all events, conditions and facts materially effecting
the business, financial condition and results of operation of VV which
occurred prior to January 1, 1996. The Purchaser has not, and will not
have, at the Closing, withheld disclosure of any such events, conditions
and facts of which the Purchaser has knowledge or has reasonable grounds
to know may exist.
(k) The Purchaser agrees to indemnify and hold harmless the Company,
its officers, directors, employees and agents (collectively, the
"Indemnitees") from any and all liability which may be incurred by the
Indemnitees relating to or arising out of any claim, action, or
proceeding pertaining to any purported exercise of the option dated
December 8, 1995, to purchase capital stock of VV granted to Xxxxxx
Xxxxxxxxx.
4. Representations, Warranties and Certain Covenants of the Company. The
Company represents and warrants to, and agrees with, the Purchaser as follows:
(a) The Shares:
(i) when issued as contemplated in this Agreement, will be duly and
validly authorized and issued, fully paid and non-assessable;
(ii) when issued as contemplated in this Agreement, will not have
been issued or sold in violation of any pre-emptive or other similar
rights of the holders of any securities of the Company; and
(iii) will not subject the holders thereof to personal liability by
reason of being such holders.
(b) The Company has full legal right, capacity and authority to enter
into this Agreement, to issue and sell the Shares and to perform its other
obligations hereunder and to consummate the transactions contemplated
hereby. This Agreement has been duly executed and delivered by the Company
and is a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms.
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(c) The Company acknowledges that, in making the decision to purchase
the VV Shares, it has relied solely upon independent investigations made
by it and not on any representations made by of the Purchaser with respect
to VV or the VV Shares, except for the representations and warranties of
the Purchaser with respect to the VV Shares contained in this Agreement.
The Company hereby acknowledges that the Purchaser has not made any
representations or warranties regarding the business, financial condition
or operation of VV or MOVIE VISION and no such representations or
warranties are required by the Company.
(d) The Company understands that the VV Shares are being offered and
sold to it in reliance on specific exemptions from the registration
requirements of Federal and state securities laws and that the Purchaser
is relying, in part, upon the truth and accuracy of the representations,
warranties, agreements, acknowledgements, and understandings of the
Company set forth herein in order to determine the applicability of such
exemptions and the suitability of the Company to acquire the VV Shares.
(e) The Company is an "accredited investor" within the meaning of Rule
501 of Regulation D under the Securities Act and was not organized for the
specific purpose of acquiring the VV Shares.
(f) The Company has sufficient knowledge and experience in investing in
companies similar to VV so as to be able to evaluate the risks and merits
of its investment in VV and it is able financially to bear the risks
thereof.
(g) The Company has had an opportunity to discuss VV's business,
management and financial affairs with the Company's management and to make
inquiries of the VV's management concerning all matters which the Company
deems relevant to its decision to purchase the VV Shares, and the Company
has received satisfactory answers to all such inquiries. The Company
acknowledges that Xxxx Xxxxxx, an executive officer of the Company, has
participated as a key member of management of both VV and MOVIE VISION and
as such Xx. Xxxxxxx and the Company are familiar with the business,
financial condition, liabilities and operation of each of VV and MOVIE
VISION.
(h) The VV Shares are being acquired by the Company for its own account
for the purpose of investment and not with a view to or for sale in
connection with any distribution thereof.
(i) The Company is aware that the VV Shares have not been registered
under the Securities Act and may only be offered or sold by the Company
pursuant to registration under the Securities Act or an available
exemption therefrom.
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(j) There is no pending or, to the best knowledge of the Company,
threatened action, suit, proceeding, or investigation before any court,
governmental agency or body, or arbitrator having jurisdiction over the
Company that would materially affect the execution by the Company of, or
the performance by the Company of its obligations under, this Agreement.
(k) The Common Stock is a class of securities registered under the
provisions of the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
(l) The Company is a corporation duly organized, validly existing and
in good standing under the laws of its state of incorporation and has full
corporate power and authority to own and lease all of the properties and
assets it now owns and leases and to carry on its business as now being
conducted, except where the failure to so qualify would have no material
negative impact on the Company. The Company has heretofore delivered to
the Purchaser complete and correct copies of the Company's Certificate of
Incorporation and Bylaws, each as currently in effect.
(m) Except as disclosed in the SEC Reports (as hereinafter defined),
there are no options, warrants or other commitments of any kind by the
Company to issue or sell any shares of capital stock or any securities or
obligations convertible into or exchangeable for, or giving any person any
right to acquire from the Company, any shares of its capital stock.
(n) The Company has timely filed all reports with the Securities and
Exchange Commission (the "Commission") required to be filed by it under
the Exchange Act (collectively, the "SEC Reports"). Such SEC Reports, at
the time filed, complied as to form in all material respects with the
requirements of the Exchange Act. None of the SEC Reports, including,
without limitation, any financial statements or schedules included
therein, when filed, contained any untrue statement or material fact or
omitted to state a material fact necessary in order to make the statements
made, when and in light of the circumstances under which they were made,
not misleading. There have been no material adverse changes in the
Company's business, properties, results of operations, condition
(financial or otherwise) or prospects since the date of the Company's most
recently filed report which have not been disclosed to the Purchaser in
writing. The consolidated balance sheet of the Company contained in the
most recently filed Form 10-QSB comprising a part of the SEC Reports, and
the related consolidated statements of income, changes in stockholders'
equity and changes in cash flows for the periods then ended (such
consolidated balance sheet of the Company is hereinafter referred to as
the "Balance Sheet"), except as indicated therein, have been prepared in
accordance with generally accepted accounting principles consistently
followed throughout the periods indicated, except that such financial
statements do not contain notes and may be subject to normal audits
adjustments and normal annual adjustments. The Balance Sheet fairly
presents the financial condition of the Company and its subsidiaries at
the date thereof and, except
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as indicated therein, reflects all claims against and all debts and
liabilities the Company and its subsidiaries, fixed or contingent, as of
the date thereof and the related statements of income, stockholders'
equity and changes in cash flows fairly present the results of the
operations of the Company and its subsidiaries and the changes in their
financial position for the period indicated. Since the date of the Balance
Sheet, except as disclosed in the SEC Reports or as otherwise disclosed in
writing by the Company to the Purchaser, there has been (x) no material
adverse change in the assets or liabilities, or the business or condition,
financial or otherwise, or the results of operations or prospects, of the
Company and its subsidiaries, whether as a result of any legislative or
regulatory change, revocation of any license or rights to do business,
fire, explosion, accident, casualty, labor trouble, flood, drought, riot,
storm, condemnation, act of God, public force or otherwise and (y) no
change in the assets or liabilities, or in the business or condition,
financial or otherwise, or in the results of operations or prospects, of
the Company except in the ordinary course of business; and no fact or
condition exists or is contemplated or threatened which might cause such
a change in the future.
(o) All of the information provided to the Purchaser by the Company
regarding the Company was and remains true, correct and complete in all
material respects and no representation, warranty or statement made by the
Company in or pursuant to this Agreement contains any untrue statement of
a material fact or omits or will omit to state any material fact necessary
in order to make such information, representation, warranty or statement
not misleading.
5. Lock-Up Period. The Purchaser shall be entitled to sell up to Two
Hundred Fifty Thousand ($250,000) Dollars worth of the Shares commencing ninety
(90) days after the Closing Date in accordance with Rule 144 and/or the
piggyback registration provision set forth in Section 6 hereof, as follows:
(a) in each successive thirty (30) day period after the initial ninety
(90) day period expires the Purchaser shall be entitled to sell one
sixth (1/6th) of said $250,000 worth of Shares;
(b) the Purchaser shall give the Company one business day's written notice
of his intention to sell and the Company shall have the first right of
refusal to purchase said Shares at the then market price; and
(c) if in any of the six thirty (30) day periods following the initial
ninety (90) day period the Purchaser does not sell the allowed number
of Shares, then the Purchaser shall be entitled to accumulate the
right to sell such Shares and to sell them in any of the remaining
thirty (30) day periods. In any event, after the expiration of 270
days from the Closing Date, the Purchaser shall be entitled to sell
the said $250,000 worth of Shares at any time or from time to
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time, subject only to the Company's first right of refusal to purchase
them at the then market price, and applicable securities laws and
requirements.
Fifty percent (50%) of the remainder of the Shares in excess of those
valued at $250,000 shall not be sold or otherwise transferred by the
Purchaser until after January 29, 1999, after which time such Shares may be
freely sold or transferred by the Purchaser, subject only to applicable
securities laws. All Shares may be freely sold or transferred by the
Purchaser, subject only to applicable securities laws, at any time after June
29, 1999.
The restrictions on transfer set forth in this Section 5 shall in no way
limit the Purchaser's rights under Section 6 hereof.
6. Registration of the Shares under the Securities Act. The Company
covenants and agrees with the Purchaser as follows:
(a) If the Company at any time following the Closing Date proposes to
resister any of its securities under the Securities Act for sale to the
public, whether for its own account or for the account of other security
holders or both (except with respect to registration statements on Forms
X-0, X-0 or another form not available for registering the Shares for sale
to the public), each such time it will give prompt written notice to the
Purchaser of its intention so to do and of the proposed method of
distribution of such securities. Upon the written request of the Purchaser
received by the Company within thirty (30) days after the giving of any
such notice by the Company, to register any of such Purchaser's Shares,
the Company will use all reasonable efforts to cause the Shares to be
covered by the registration statement proposed to be filed by the Company,
all to the extent and under the conditions such registration is permitted
under the Securities Act. In the event that any registration pursuant to
this Section 6(a) shall be, in whole or in part, an underwritten public
offering of Common Stock, the number of Shares to be included in such an
underwriting may be reduced if and to the extent that the managing
underwriter shall be of the opinion (a written copy of which shall be sent
to the Purchaser) that the inclusion of some or all of the Shares would
adversely affect the marketing of the securities to be sold by the Company
therein. Notwithstanding the forgoing provisions the Company may withdraw
any registration statement referred to above without thereby incurring any
liability to the Purchaser or holders of the Shares. The rights granted
pursuant to the provisions of this Section 6(a) are transferable by the
Purchaser.
(b) When the Company is required by the provisions of Section
6(a) to use its best efforts to effect the registration of the
Shares under the Securities Act, the Company will, as expeditiously
as practicable:
(i) prepare and file with the Securities and Exchange Commission
(the "Commission") a registration statement with respect to the Shares
and use
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its best efforts to cause such registration statement to become
effective as soon as reasonably practicable, and to remain effective
throughout the period of distribution or, in the event of a
registration on Form S-3 or any successor form, for a period of at
least one year from the effective date of such registration statement.
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for the period of distribution and comply with the
provisions of the Securities Act with respect to the disposition of all
Shares covered by such registration statement in accordance with the
Purchaser's intended method of disposition set forth in such
registration statement for such period of distribution;
(iii) furnish to the Purchaser such number of copies of the
registration statement and the prospectus included therein (including
each preliminary prospectus) as the Purchaser reasonably may request in
order to facilitate the public sale or other disposition of the Shares
covered by such registration statement;
(iv) use its best efforts to register or qualify the Shares
covered by such registration statement under the securities or "blue
sky" laws of such jurisdictions as the Purchaser reasonably may
request, provided, however, that the Company shall not for any such
purpose be required to qualify generally to transact business as a
foreign corporation in any jurisdiction where it is not so qualified or
to consent to general service of process in any such jurisdiction;
(v) use its best efforts to list the Shares covered by such
registration statement with any securities exchange or quotation
service on which the Common Stock of the Company is then traded; and
(vi) immediatley notify the Purchaser, at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company has
knowledge as a result of which the prospectus contained in such
registration statement, as then in effect, includes an untrue statement
of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing.
(c) In connection with the registration of the Shares hereunder, the
Purchaser shall provide the Company such information as the Company may
reasonably request and complete and execute all questionnaires, powers of
attorney,
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indemnities, underwriting agreements and other documents reasonably
requested by the Company.
(d) The Company will pay all Registration Expenses (as such term is
hereinafter defined) in connection with the registration statement under
Section 6(a). All Selling Expenses (as such term is hereinafter defined)
in connection with such registration statement shall be borne by the
Purchaser. For purposes of this Section 6, the term "Registration
Expenses" shall mean all registration and filing fees, printing expenses,
fees and disbursements of counsel and independent public accountants for
the Company and fees and expenses incurred in connection with applying for
listing and quotation on any securities exchange or quotation service,
fees and expenses (including counsel fees) incurred in connection with
complying with state securities or "blue sky" laws, fees of the National
Association of Securities Dealers, Inc., transfer taxes, and fees of
transfer agents and registrars; and the term "Selling Expenses" shall mean
all underwriting discounts and selling commissions applicable to the sale
of the Shares.
(e) (i) In the event of a registration of any of the Shares under the
Securities Act pursuant to Section 6(a), the Company will indemnify and
hold the Purchaser harmless against any losses, claims, damages or
liabilities, joint or several, to which the Purchaser may become subject
under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement of any material fact contained in any
registration statement under which such Shares were registered under the
Securities Act pursuant to Section 6(a), any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereof,
or arise out of or are based upon the omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading or any violation by the Company of the
Securities Act, the Exchange Act, any state securities law or any rule or
regulation promulgated under the Securities Act, the Exchange Act or any
state securities law, and will pay the legal fees and other expenses of
the Purchaser in connection with investigating or defending any such
loss, claim, damage, liability or action, provided, however, that the
Company will not be liable in any such case if and to the extent that any
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or omission so made in reliance upon and in conformity
with information furnished by or on behalf of the Purchaser in writing
specifically for use in such registration statement or prospectus.
(ii) In the event of a registration of any of the Shares under the
Securities Act pursuant to Section 6(a), the Purchaser will indemnify
and hold harmless the Company, each person, if any, who controls the
Company within the meaning of the Securities Act, each officer of the
Company who signs the registration statement, each director of the
Company, each underwriter and each person who controls any
underwriter within the meaning of the Securities Act,
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against all losses, claims, damages or liabilities, joint or several, to
which the Company or such officer, director, underwriter or controlling
person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement of
any material fact contained in the registration statement under which
such shares were registered under the Securities Act pursuant to
Section 6(a), any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are
based upon the omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will pay the legal fees and other expenses of the
Company and each such officer, director, underwriter and controlling
person incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action, provided, however,
that the Purchaser will be liable hereunder in any such case if and
only to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or omission made in
reliance upon and in conformity with information furnished in writing
to the Company by the Purchaser specifically for use in such
registration statement or prospectus.
(iii) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall,
if a claim in respect thereof is to be made against the indemnifying
party hereunder, notify the indemnifying party in writing thereof, but
the omission so to notify the indemnifying party shall not relieve it
from any liability that it may have to such indemnified party other
than under this Section 6(e) and shall only relieve it from any
liability that it may have to such indemnified party under this Section
6(e) if and to the extent the indemnifying party is prejudiced by such
omission. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in and, to the extent it shall wish, to assume and
undertake the defense thereof with counsel reasonably satisfactory to
such indemnified party, and, after notice from the indemnifying party
to such indemnified party of its election so to assume and undertake
the defense thereof, the indemnifying party shall not be liable to such
indemnified party under this Section 6(e) for any legal expenses
subsequently incurred by such indemnified party in connection with the
defense thereof; provided, however, that, if the defendants in any such
action include both the indemnified party and the indemnifying party
and the indemnified party shall have reasonably concluded (based on the
advice of counsel) that there may be reasonable defenses available to
it which are different from or additional to those available to the
indemnifying party or if the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to
select a
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separate counsel and to assume such legal defenses and otherwise to
participate in the defense of such action, with the reasonable expenses
and fees of such separate counsel and other expenses related to such
participation to be reimbursed by the indemnifying party as incurred, it
being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar
or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees
and expenses of more than one separate firm of attorneys (together with
appropriate local counsel as required by the local rules of such
jurisdiction) at any time for all such indemnified parties.
(f) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either (i) the
Purchaser exercising rights under this Agreement, makes a claim for
indemnification pursuant this Section 6 but it is judicially determined
(by the entry of a final judgement or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in
such case notwithstanding the fact that this Section 6 provides for
indemnification in such case, or (ii) contribution under the Securities
Act may be required on the part of any such selling Purchaser in
circumstances for which indemnification is provided under this Section 6;
then, and in each such case, the Company and the Purchaser will contribute
to the aggregate losses, claims, damages or liabilities to which they may
be subject (after taking into account contribution from others) in such
proportion as may be reasonable taking into account such matters as (i)
their relative fault as to the matters giving rise to such losses, claims,
damages or liabilites; (ii) their relative ability or opportunity to have
avoided such losses, claims, damages or liabilites, provided, however,
that, in any such case, no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 12(f) of the Securities
Act) will be entitled to contribution from any person or entity who was
not guilty of such fraudulent misrepresentation.
(g) (i) The Company may, by written notice to each of the Purchaser,
suspend use of the registration statement hereunder after effectiveness
and require that the Purchaser immediately cease sales of the Shares
pursuant to the registration statement during any period in which the
Company is engaged in any activity or transaction or preparations or
negotiations for any activity or transaction that the Company desires to
keep confidential for business reasons, if the Company determines in good
faith that the public disclosure requirements imposed on the Company under
the Securities Act in connection with the registration statement would
require disclosure of such activity, transaction, preparation or
negotiations.
(ii) If the Company delays or suspends the registration statement
or requires the Purchaser to cease sales of the Shares pursuant to
paragraph (g)(i) above, the Company shall, as promptly as practicable
following the termination
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of the circumstance which entitled the Company to do so, take such
actions as may be necessary to file or reinstate the effectiveness of
the registration statement and/or give written notice to the
Purchaser authorizing him to resume sales pursuant to the registration
statement. If as a result thereof, the prospectus included in the
registration statement has been amended to comply with the
requirements of the Securities Act, the Company shall enclose such
revised prospectus with the notice to the Purchaser given pursuant to
this paragraph (g)(ii), and the Purchaser shall make no offers or
sales of the Shares pursuant to the registration statement other than
by means of such revised prospectus.
(h) If the Purchaser transfers the Shares pursuant to Rule 144 or Rule
144(k), the Purchaser shall provide the Company with notice of such
transfer and the Company shall not be required to effect a registration
pursuant to this Section 6 with respect to such Shares.
(i) The Purchaser agrees to be bound by such lock-up agreements as the
managing underwriter of any such registration shall specify as a
requirement to any underwriting, provided that the entry of the Purchaser
into such agreements shall be conditioned upon all executive officers and
directors (regardless of the number of shares of the capital stock of the
Company then owned by them) and holders who, at the time of the proposed
filing of a registration statement for an underwritten offering by the
Company, beneficially own 5% or more of the outstanding capital stock of
the Company also agreeing to execute such lock-up agreement on identical
terms, provided, however, that Purchaser shall not be obligated to execute
a lock-up agreement with a lock-up period longer than 210 days.
(j) It is understood that certificates evidencing the Shares may bear
substantially the following legends:
(i) "These securities have not been registered under the
Securities Act of 1933. They may not be sold, offered for
sale, pledged or hypothecated in the absence of a
registration statement in effect with respect to the
securities under such Act or an opinion of counsel
satisfactory to the Company that such registration is not
required or unless sold pursuant to Rule 144 of such Act."
(ii) "These Securities are subject to certain lock-up provisions
as set forth in the Stock Purchase Agreement dated as of
January 29, 1998 between Xxxx Communications Inc. and Xxxxxxx
Xxxxxxxxxx."
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7. Conditions Precedent to the Purchaser's Obligations. The
obligations of the Purchaser hereunder are subject to the performance by the
Company of its obligations hereunder and to the satisfaction of the following
additional conditions precedent:
(a) The representations and warranties made by the Company in this
Agreement shall be true and correct as of the date hereof and at the
Closing Date, with the same force and effect as if they had been made on
and as of the Closing Date, and the Company shall have delivered to the
Purchaser a certificate, dated the Closing Date, to that effect.
(b) After the date hereof until the Closing Date there shall not
have occurred
(i) any change, or any development involving a prospective
change, in either (a) the condition, financial or otherwise, or in
the earnings, business operations or prospects or in or affecting
the properties of the Company or (b) the financial or market
conditions or circumstances in the United States, in either case
which, in the Purchaser's reasonable judgment, is material and
adverse and makes it impractical or inadvisable to proceed with the
offering, sale, or delivery of the Shares;
(ii) an imposition of a new legal or regulatory restriction
not in effect on the date hereof, or any change in the
interpretation of existing legal or regulatory restrictions, that
materially and adversely affects the offering, sale, or delivery of
the Shares; or
(iii) a suspension, delisting or material limitation of,
trading (a) generally on or by Nasdaq or (b) of any securities
of the Company on any exchange or in any over-the-counter market.
(c) All consents, approvals, or waivers, if any, required in
connection with the consummation of the transactions contemplated by this
Agreement, shall have been received. All of the consents, approvals,
authorizations, exemptions and waivers, if any, from government agencies
that shall be required in order to enable the Company to consummate the
transactions contemplated hereby shall have been obtained.
(d) No action or proceeding shall have been instituted or, to the
knowledge of the Company, threatened before a court or other government
body or any public authority to restrain or prohibit any of the
transactions contemplated hereby, and the Company shall have delivered to
the Purchaser a certificate, dated the Closing Date, to such effect.
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8. Conditions Precedent to the Company's Obligations. The obligations
of the Company hereunder are subject to the performance by the Purchaser of
its obligations hereunder and to the satisfaction of the following additional
conditions precedent:
(a) The representation and warranties made by the Purchaser in this
Agreement shall, unless waived by the Company, be true and correct at the
Closing Date, with the same force and effect as if they had been made on,
and as of, the Closing Date and the Purchaser shall have delivered to the
Company a certificate, dated the Closing Date, to that effect.
(b) All consents, approvals, or waivers, if any, required in
connection with the consummation of the transactions contemplated by this
Agreement shall have been received. All of the consents, approvals,
authorizations, exemptions and waivers, if any, from government agencies
that shall be required in order to enable the Purchaser to consummate the
transactions contemplated hereby shall have been obtained.
(c) No action or proceeding shall have been instituted or, to the
knowledge of the Purchaser, threatened before a court or other government
body or any public authority to restrain or prohibit any of the
transactions contemplated hereby, and the Purchaser shall have delivered
to the Company a certificate, dated the Closing Date, to such effect.
(d) Xxxxxxx Xxxxxxxxxx shall have made a capital contribution to VV
of all amounts owed by VV to Xxxxxxx Xxxxxxxxxx, and Xxxxxxx Xxxxxxxxxx
and Xxxxx Xxxxxxxxxx shall have executed and delivered, in a form
satisfactory to the Company, a General Release releasing VV, MOVIE
VISION, MovieBar USA and certain other persons named therein from any and
all claims which Xxxxxxx Xxxxxxxxxx or Xxxxx Xxxxxxxxxx have or may have
against VV, MOVIE VISION, MovieBar USA and certain other persons named
therein.
9. Fees and Expenses. The Company agrees to pay the fees and expenses
(including legal fees and expenses of up to $15,000) of the Purchaser
incident to the negotiation and preparation of this Agreement and the
Closing hereunder.
10. Survival of the Representations, Warranties, etc. The respective
agreements, representations, warranties, indemnities, and other statements
made by or on behalf of the Company and the Purchaser, respectively, pursuant
to this Agreement, shall remain in full force and effect and will survive
delivery of the Shares for a period of two years from the Closing Date.
11. Termination. This Agreement may be terminated at any time prior to
the Closing Date:
(a) By mutual consent of the Company and the Purchaser;
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(b) By the Company if any representation or warranty of the Purchaser,
or by the Purchaser if any representation or warranty of the Company,
contained herein shall have been incorrect or breached in any material
respect, as to which notice shall have been given to such party, and shall
not have been cured or otherwise resolved to the reasonable satisfaction
of the other party on or before the Closing Date;
(c) By either the Company or the Purchaser if any permanent injunction
or other order of a court or other competent authority preventing the
consummation of the transactions contemplated by this Agreement shall have
become final and non-appealable; or
12. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to be effective (i) when
delivered in person, (ii) three (3) business days after being mailed by
certified or registered mail, return receipt requested, (iii) the next
business day after being sent by a recognized overnight courier service, or
(iv) when sent by facsimile transmission, e-mail or other electronic means
(provided electronic confirmation is generated upon such transmission), in
each case addressed as follows:
if to the Purchaser, at:
Xxxxxxx Xxxxxxxxxx
000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
with copy to:
Xxxxxxx X. Xxxxx, Esq.
Peabody & Xxxxxx
00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax: (000) 000-0000
if to the Company, at:
Xxxx Communications, Inc.
00000 Xxx Xxxx Xxxxxx, Xxxxx X
Xxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxx
Fax: (000) 000-0000
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with copy to:
Xxx Xxxxxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxxxx & Xxxxxxxx
Xxx Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Fax: (000) 000-0000
or, in any case, to such other address as the addressee shall have indicated
in a written notice to the other party as provided herein.
13. Miscellaneous.
(a) This Agreement may be executed by facsimile signature and in one or
more counterparts and it is not necessary that signatures of all parties
appear on the same counterpart, but such counterparts together shall
constitute but one and the same agreement.
(b) This Agreement shall inure to the benefit of and be binding upon
the parties hereto, their respective successors and no other person shall
have any right or obligation hereunder.
(c) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Florida without regard to such state's
principals of conflicts of law.
(d) Any suit for the enforcement of this Agreement may be brought in
the courts of the State of Florida or any federal or state court sitting in
Palm Beach County, Florida, and each party hereto consents to the
non-exclusive jurisdiction of each such court and to service of process in
any such suit being made upon the Company or any or the Purchaser by mail
at the address specified above. Each party hereto hereby waives any
objection that it may now or hereafter have to the venue of any such suit
or any such court or that such suit was brought tin any inconvenient court.
The prevailing party in any such suit shall be entitled to reimbursement
from the other party of reasonable attorney's fees.
(e) The headings of the sections of this document have been inserted for
convenience of reference only and shall not be deemed to be a part of this
Agreement.
(f) This Agreement may be amended by the parties hereto at any time
prior to the Closing Date; provided, however, that any amendment must be by
an instrument or instruments in writing signed and delivered on behalf of
each of the parties hereto.
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(g) Any provision hereof which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in
any other jurisdiction. To the extent permitted by applicable law, the
parties hereby waive any provision of law which may render any provision
hereof prohibited or unenforceable in any respect.
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement, all as of the day and year first above written.
XXXX COMMUNICATIONS, INC.
By: ___________________________
________________________________
Xxxxxxx Xxxxxxxxxx
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