STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, being made this 30 day of
November, 1996 same by and between DYNAMICWEB ENTERPRISES, INC., a
New Jersey corporation whose main address is 0000 Xxxxx 00 Xxxx,
Xxxxx X-000, Xxxxxxx, Xxx Xxxxxx 00000 (hereinafter referred to as
"DWEB"); and SOFTWARE ASSOCIATES, INC., a New Jersey corporation,
whose main address 000 Xxxxx 00 Xxxx, Xxxxx X-000, Xxxxxxxxx, Xxx
Xxxxxx 00000 hereinafter referred to as "SOFTWARE"); and the
Shareholders of Software Associates, Inc. as listed on Exhibit "A"
attached hereto (hereinafter referred to as "SOFTWARE
Shareholders").
1. Recitals.
SOFTWARE Shareholders are the owners of all of the issued and
outstanding shares of the capital stock of SOFTWARE ("the SOFTWARE
Shares "). DWEB wishes to purchase from SOFTWARE Shareholders, and
SOFTWARE Shareholders wish to sell to DWEB, the SOFTWARE Shares
upon the terms and conditions hereinafter set forth. Accordingly,
in consideration of the mutual covenants contained herein and
intending to be legally bound hereby, the parties hereto agree as
hereinafter set forth.
2. Sale and Purchase of Stock.
SOFTWARE Shareholders hereby agree to sell, assign, transfer
and deliver and do hereby sell, assign, transfer and deliver to
DWEB, and DWEB agrees to purchase, acquire and accept from SOFTWARE
Shareholders, and does hereby purchase, acquire and accept from
SOFTWARE Shareholders, upon the terms and conditions set forth in
this Agreement, complete, absolute and unencumbered right, title
and interest in and to the SOFTWARE Shares.
3. Consideration.
The entire consideration to be paid to SOFTWARE Shareholders
in exchange for the sale, transfer, assignment and delivery of the
SOFTWARE Shares as set forth in Section 2 above is Eight Hundred
Sixty Thousand (860,000) common shares of the authorized but
unissued capital stock of DWEB ("Purchase Price"). In the event
the said stock of DWEB does not have the trading price of an
average of $3.375 (an average of the previous five trading days
closing bid prices) per share, by January 30, 1999, then additional
shares of DWEB stock will be issued by DWEB to equal the difference
(with a maximum of 2,000,000 shares).
4. Payment for Shares.
As soon as practical after the execution and delivery of this
Agreement, DWEB shall deliver to SOFTWARE Shareholders, for
investment purposes only, in accordance with written instructions
from such shareholders, Eight Hundred Sixty Thousand (860,000)
common shares of the authorized but unissued capital stock of DWEB.
5. Representations and Warranties of DWEB.
DWEB represents and warrants to SOFTWARE as follows:
5.1 Organization and Qualification. DWEB 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 to carry on its business as it is now being conducted. DWEB
is duly qualified as a foreign corporation to do business, and is
in good standing, in each jurisdiction where the character of its
properties owned or leased or the nature of its activities makes
such qualification necessary.
5.2 Capitalization. The authorized capital stock of DWEB
consists of 50,000,000 Shares, $.0001 par value per share. As of
the execution of this Agreement there will be approximately
6,498,511 Shares validly issued, fully paid and nonassessable.
There are no Warrants outstanding. Except for the obligation of
DWEB to issue Shares hereunder, there are no other options,
warrants or other rights, agreements or commitments (contingent or
otherwise) obligating DWEB to issue shares of its capital stock.
5.3 Authority Relative to this Agreement. DWEB has the
requisite corporate power and authority to enter into this
Agreement and to carry out its obligations hereunder. The
execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly authorized by
the Board of Directors of DWEB and, no other corporate proceedings
on the part of DWEB are necessary to authorize this transaction and
the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by DWEB and, assuming this
Agreement constitutes a valid and binding obligation of SOFTWARE
Shareholders and SOFTWARE, this Agreement constitutes a valid and
binding agreement of DWEB, enforceable against DWEB in accordance
with its terms. DWEB is not subject to or obligated under any
charter, by-law or contract provision or any license, franchise or
permit, or any order or decree, which would be breached or violated
or in respect of which a right of acceleration would be created by
its executing and carrying out this Agreement, other than any such
breach, violation or right which will not have a material adverse
effect on DWEB.
5.4 Validity of Shares. The issuance and delivery by DWEB of
the DWEB Common Stock in connection with this Agreement has been
duly and validly authorized by all necessary corporate action on
the part of DWEB. The shares of DWEB Common Stock to be issued to
SOFTWARE Shareholders will, when issued, be validly issued, fully
paid and nonassessable.
5.5 Lock-Up. Xxx Xxxxxxxxxx, a SOFTWARE Shareholder will own
beneficially approximately 860,000 Shares of DWEB common stock
outstanding. DWEB will obtain a Lock-Up Agreement restricting
750,000 of such of Xx. Xxxxxxxxxx'x shares for a period of two
years from the date of Closing without the prior written approval
of the Company. Xx. Xxxxxxxxxx'x shares will bear an additional
legend stating that they are restricted pursuant to the terms of
this Agreement.
5.6 1934 Act Filings. DWEB at the time of Closing will be
current in all of the 1934 Securities Act filings due as of the
date of this Agreement, which filings do not contain any material
misstatements of fact or omissions to state material facts.
5.7 Employment Agreement DWEB represents and warrants that
Xxx Xxxxxxxxxx shall be given a five year employment contract as an
Executive Vice President of DWEB, as well be appointed a Director
of DWEB. He will report directly to Xxxxxx Xxxxxxxxxx, Xx.,
President of DWEB. The terms and conditions of his employment are
set forth in an Employment Contract attached hereto as Schedule B.
5.8 Relocation. DWEB represents and warrants that DWEB will
continue to lease the SOFTWARE office space in Fairfield Commons
from Xxx Xxxxxxxxxx under the same terms and conditions that
currently apply, initially for a period not to exceed five years,
and will relocate its offices to Fairfield Commons, Fairfield, New
Jersey.
5.9 Software Employees. DWEB represents and warrants that it
will retain all SOFTWARE employees for at least 12 months subject
to Xxx Xxxxxxxxxx'x written consent, and certain reasonable
performance criteria.
5.10 Reservation of DWEB Stock for SOFTWARE employees. DWEB
represents and warrants that it will make available up to an
additional 25,000 shares of DWEB restricted common stock for Xxx
Xxxxxxxxxx to award to key employees. The stock will vest over the
next 12 months.
6. Representations and Warranties of SOFTWARE Shareholders
and SOFTWARE.
SOFTWARE Shareholders and SOFTWARE, jointly and severally,
represent and warrant as follows:
6.1 Organization and Qualification. SOFTWARE 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 to carry on its business as it is now being
conducted. SOFTWARE is duly qualified as a foreign corporation to
do business, and is in good standing, in each jurisdiction where
the character of its properties owned or leased or the nature of
its activities makes such qualification necessary.
6.2 Capitalization. The authorized capital stock of SOFTWARE
consists of 2,500 shares of common stock, no par value, of which
2,500 shares have been or will be issued and outstanding and or
reserved prior to Closing. There are no Options, Warrants or other
rights, agreements or commitments (contingent or otherwise)
obligating SOFTWARE to issue additional shares of its capital
stock.
6.3 Authority Relative to this Agreement. SOFTWARE has the
requisite corporate power and authority to enter into this
Agreement and to carry out its obligations hereunder. The
execution and delivery of this Agreement and the consummation of
the Agreements contemplated hereby have been duly authorized by the
Board of Directors of SOFTWARE and the SOFTWARE Shareholders and,
no other corporate proceedings on the part of SOFTWARE are
necessary to authorize this Agreement and the Agreements
contemplated hereby. This Agreement has been duly and validly
executed and delivered by SOFTWARE and, assuming this Agreement
constitutes a valid and binding obligation of DWEB, this Agreement
constitutes a valid and binding agreement of SOFTWARE and the
SOFTWARE Shareholders, enforceable against them, respectively in
accordance with its terms. SOFTWARE is not subject to or obligated
under any charter, by-law or contract provision or any license,
franchise or permit, or any order or decree, which would be
breached or violated or in respect of which a right of acceleration
would be created by its executing and carrying out this Agreement,
other than any such breach, violation or right which will not have
a material adverse effect on SOFTWARE.
6.4 Financial Statements and Reports. A prerequisite of this
transaction shall be proof to the satisfaction of DWEB that
SOFTWARE can and will obtain a minimum of two years certified
financials of SOFTWARE within sixty days of the Closing prepared in
accordance with the Rules and Regulations of the United States
Securities and Exchange Commission ("SEC").
6.5 Lawsuits and Claims. There is no action, at law or in
equity, arbitration, proceeding, claim, governmental proceeding or
investigation pending or, to the best of SOFTWARE's knowledge after
reasonable investigation, threatened against SOFTWARE or against
any business or assets of SOFTWARE. SOFTWARE is not in default
with respect to any decree, injunction or other order of any court
or governmental authority.
6.6 Taxes. SOFTWARE has filed all United States income tax
and information returns and all state and local tax returns
(collectively referred to herein as "Tax Returns") which are
required to be filed and has paid, or made provision for the
payment of, all taxes (including, without limitation, all federal,
state or local income, property, sales, use, excise, franchise,
employment, withholding or similar taxes and all interest,
additions and penalties thereon or with respect thereto ("taxes")
which have or may have become due pursuant to said returns,
pursuant to any assessment received by SOFTWARE, or otherwise
payable pursuant to applicable law.
6.7 Liabilities. As of Closing, SOFTWARE will have no more
than $58,000 of liabilities of any nature, whether accrued,
absolute, contingent or otherwise, existing or which may hereafter
arise out of any transaction, event or occurrence heretofore
entered into or out of any act or failure to act on the part of
SOFTWARE or any of its employees.
6.8 Assets of SOFTWARE. SOFTWARE and the SOFTWARE
Shareholders represent and warrant that at the time of Closing
SOFTWARE will have full right, title and ownership to the assets
set forth on the unaudited balance sheet and financial statements
as of October 31, 1996 (Acquisition Balance Sheet), all of which
assets will remain the property of SOFTWARE at the time of Closing.
6.10 Investment Representation. The Shares being acquired
by SOFTWARE Shareholders hereunder are being acquired for
investment purposes only and not with a view towards resale or
redistribution and that no person or entity has any beneficial
interests in such shares except the SOFTWARE Shareholders. The
Shares being acquired have not been registered under the Securities
Act of 1933 as amended and SOFTWARE Shareholders acknowledge and
agree that they may not sell, offer, transfer, hypothecate or
convey such shares except pursuant to a registration statement
pursuant to the Act or an exemption therefrom. Such shares shall
be issued with the following legend and shall be subject to a stock
transfer order delivered by the Company to the transfer agent, such
legend to be as follows:
"The certificate and the shares represented hereby have
not been registered under the Securities Act of 1933 as
amended (the "1933 Act") and may not be sold or
transferred except such registration or in reliance upon
exemption from registration under the 1933 Act and the
rules and regulations promulgated thereunder."
6.11 Resignations. Simultaneously with the Closing, the
officers and directors of SOFTWARE will resign in favor of
management of DWEB.
7. Deliveries.
As soon as practical after the execution of the Agreement:
7.1 DWEB shall deliver and hereby delivers to the SOFTWARE
Shareholders certificates representing 860,000 shares of its
authorized and unissued common stock registered in accordance with
the written instructions from the SOFTWARE Shareholders.
7.2 The SOFTWARE Shareholders shall deliver to DWEB
certificates representing all of the issued and outstanding capital
stock of SOFTWARE, with stock powers duly endorsed in blank.
7.3 Xxx Xxxxxxxxxx, as set forth in Section 5.5 above, shall
execute and deliver Lock-Up Agreement respecting approximately
750,000 shares of common stock, which shares shall be held by a
mutually agreeable Escrow Agent.
8. Miscellaneous.
8.1 Reciprocal Indemnifications. The parties hereby agree
to indemnify each other for any damages sustained by the other
party due to any material breach or misrepresentation involved in
this Agreement.
8.2 Assignment. This Agreement may not be assigned by either
party without the express written consent of the other party.
8.3 Governing Law - Jurisdiction. This Agreement shall be
construed and enforced in accordance with the internal laws of the
State of New Jersey.
8.4 Notice. Any notice, request, instruction or other
document or communication required or permitted to be given under
this Agreement shall be in writing and shall be sufficiently
given if delivered in person or deposited in the United States
mail, postage prepaid, for mailing by certified or registered
mail, return receipt requested, as follows:
If to DWEB delivered or addressed to:
Xxxxxx Xxxxxxxxxx, Xx., President
DynamicWeb Enterprises, Inc.
0000 Xxxxx 00 Xxxx, Xxxxx X-000
Xxxxxxx, Xxx Xxxxxx 00000
and with copies to:
Xxxxxxx X. Xxxx, Esq.
Levy & Levy, X.X.
Xxxxx 0000, Xxxxx 000
Xxxxxxxx, Xxx Xxxxxx 00000
If to SOFTWARE or the SOFTWARE Shareholders delivered or
addressed to:
Xxx Xxxxxxxxxx, President
Software Associates, Inc.
000 Xxxxx 00 Xxxx, Xxxxx X-000
Xxxxxxxxx, Xxx Xxxxxx 00000
or to such other address or addresses as may be specified from
time to time by said party by like notice.
8.4(a) Section Heading. Section headings as to the
contents of particular sections and subsections are for
convenience only and are in no way to be construed as part of
this Agreement or as a limitation of the scope of the particular
sections or subsections to which they refer.
8.5 Entire Agreement. This Agreement and the Exhibits,
Schedules and Attachments hereto and other agreements and
documents referenced herein constitute the entire agreement and
understanding of the parties hereto with respect to the matters
herein set forth, and all prior negotiations and understandings
relating to the subject matter of this Agreement are merged
herein and are superseded and canceled by this Agreement.
8.6 Waivers - Amendments. Any of the terms or conditions
of this Agreement may be waived in writing at any time by the
party which is entitled to the benefit thereof or may be amended
or modified in whole or in part at any time by an agreement in
writing, executed in the same manner as this Agreement.
8.7 Counterparts. This Agreement may be executed in any
number of counterparts, including counterparts transmitted by
telecopier or FAX, any one of which shall constitute an original
of this Agreement. When counterparts of facsimile copies have
been executed by all parties, they shall have the same effect as
if the signature to each counterpart or copy whereupon the
document and copies of such documents shall be deemed valid as
originals. The parties agree that all such signatures may be
transferred to a single document upon the request of any party.
8.8 Closing. The Closing shall take place on or about
November 30, 1996 or as soon thereafter as practicable.
IN WITNESS WHEREOF, this instrument has been executed by the
parties hereto as of the day and year first above written.
DYNAMICWEB ENTERPRISES, INC.
By: /s/Xxxxxx X. Xxxxxxxxxx
Xxxxxx X. Xxxxxxxxxx, President
SOFTWARE ASSOCIATES, INC.
By: /s/Xxx Xxxxxxxxxx
Xxx Xxxxxxxxxx, President
AGREED AND CONSENTED TO:
/s/Xxx Xxxxxxxxxx
Xxx Xxxxxxxxxx, Individually
SHAREHOLDERS OF SOFTWARE ASSOCIATES, INC.
/s/Xxx Xxxxxxxxxx
Xxx Xxxxxxxxxx
dynamic\softwar2.agr
