EXHIBIT 10.5
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MANAGEMENT
SUBSCRIPTION AGREEMENT
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May 16, 2000
Wilmar Industries, Inc.
000 Xxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Gentlemen:
1. The undersigned, (hereinafter the "Purchaser") hereby
subscribes for 27,068 shares of Common Stock, no par value (the "Common Stock"),
of Wilmar Industries, Inc., a New Jersey corporation (the "Corporation"), and
57,293 shares of Senior Preferred Stock, par value $0.01 per share (the
"Preferred Stock," and together with the Common Stock, the "Shares"), of the
Corporation. The purchase price for the Common Stock shall be $1.00 per share,
and the purchase price for the Preferred Stock shall be $10.00 per share.
Payment for the Preferred Stock and Common Stock will be made (upon the issuance
of appropriate certificates representing such shares to and in the name of the
Purchaser) by delivering to the Corporation a promissory note in the principal
amount of $599,998 in the form of Exhibit A attached hereto (the "Promissory
Note").
2. REPRESENTATIONS AND WARRANTIES OF THE CORPORATION. The
Corporation represents and warrants to the Purchaser as follows:
2.1 The Corporation is a corporation duly organized,
validly existing and in good standing under the laws of the State of New Jersey,
and has the requisite corporate power and authority to execute and deliver this
subscription agreement (the "Agreement") and to perform its obligations
hereunder.
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2.2 The execution, delivery and performance of this
Agreement, and the execution, issuance, sale and delivery of the Shares have
been duly authorized by all necessary corporate action on the part of the
Corporation.
3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser
represents and warrants to the Corporation as follows:
3.1 The Purchaser has had access to the same kind of
information concerning the Corporation and WM Acquisition, Inc., a New Jersey
corporation ("Merger Sub"), that is required by Schedule A of the Securities Act
of 1933, as amended (the "Act"), to the extent that the Corporation possesses
such information;
3.2 The Purchaser has such knowledge and experience in
financial and business matters that the Purchaser is capable of utilizing the
information that is available to the Purchaser concerning the Corporation to
evaluate the risks of investment in the Corporation;
3.3 The Purchaser acknowledges that the Shares, when
issued, will be subject to a shareholders agreement (the "Shareholders
Agreement") and a pledge agreement (the "Pledge Agreement") and may not be sold,
transferred, pledged or encumbered except in accordance with the terms thereof.
3.4 The Purchaser has been given copies of the
Shareholders Agreement and Pledge Agreement and was afforded ample opportunity
to read it, and he is thoroughly familiar with its terms;
3.5 The Purchaser acknowledges that a notation shall be
made in the appropriate records of the Company indicating that the Shares owned
by the Purchaser are subject to restriction on transfer and, if the Company
should at some time in the future
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engage the services of a stock transfer agent, appropriate stop transfer
restrictions will be issued to such transfer agent with respect to the Shares.
3.6 The Purchaser acknowledges that he has been advised
that the Shares have not been registered under the Act and, accordingly, that he
may not be able to sell or otherwise dispose of the Shares when the Purchaser
wishes to do so;
3.7 The Purchaser represents and warrants that the Shares
are being purchased by the Purchaser for the Purchaser's own sole benefit and
account for investment and not with a view to, or for resale in connection with,
a public offering or distribution thereof;
3.8 The Purchaser agrees that the Shares will not be
resold (a) without registration thereof under the Act (unless an exemption from
such registration is available) or (b) in violation of any law;
3.9 The Purchaser consents that the certificate or
certificates representing the Shares may be impressed with a legend indicating
that the Shares are not registered under the Act and reciting that transfer
thereof is restricted; and
3.10 The Purchaser consents that stop transfer
instructions in respect of the Shares may be issued to any transfer agent,
transfer clerk or other agent at any time acting for the Corporation.
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Very truly yours,
XXXXXXX X. XXXXXXX
By: /s/ Xxxxxxx X. Xxxxxxx
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Accepted: May 16, 2000
WILMAR INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Chairman of the Board of Directors
