OPTION PURCHASE AGREEMENT
This OPTION PURCHASE AGREEMENT, dated as of December 21, 1999 (this
"Agreement"), is entered into by and between IBM CREDIT CORPORATION, a Delaware
corporation ("Seller"), and Dort X. Xxxxxxx III, an individual ("Purchaser").
R E C I T A L S:
WHEREAS, Seller and Purchaser entered into that certain Option Agreement,
dated as of July 15, 1994 (the "Option Agreement"), pursuant to which Purchaser
granted to Seller an irrevocable option (the "Options") to purchase Thirty-Seven
Thousand and Thirty-Seven (37,037) shares of common stock of ENTEX Holdings,
Inc. for Thirty-Seven Thousand and Thirty-Seven Dollars ($37,037) (the "Total
Exercise Price") from Purchaser;
WHEREAS, as a result of the merger of ENTEX Holdings, Inc. into ENTEX
Information Services, Inc. ("Issuer") and the occurrence of stock splits and
stock dividends, pursuant to Section 7 of the Option Agreement, as of the date
hereof the Options represent the right to purchase One Million Eight Hundred
Fifty-One Thousand Eight Hundred Fifty (1,851,850) validly issued and
outstanding shares of common stock of Issuer (the "Common Stock") from Purchaser
at the Total Exercise Price; and
WHEREAS, Purchaser wishes to purchase the Options from Seller and Seller
wishes to sell the Options to Purchaser on and subject to the terms and
conditions set forth in this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing, and the representations,
warranties, and conditions set forth below, the parties hereto, intending to be
legally bound, hereby agree as follows:
1. Definitions. (a) Capitalized terms not otherwise defined herein shall
have the meaning set forth in the Option Agreement.
(b) "Price Per Share" shall mean an amount equal to the purchase price, net
of reasonable and customary costs and expenses actually incurred, obtained by
Purchaser or any affiliate of Purchaser, on a per share basis, in any
transaction or series of related transactions, from the sale of the common stock
of Issuer to an unaffiliated person or entity.
2. Purchase and Sale. As of the date hereof, and subject to all of the
terms and conditions hereof, including paragraph 5 regarding adjustments to the
sale of the Options, Seller hereby sells to Purchaser and Purchaser hereby
purchases from Seller the Options to buy One Million Eight Hundred Fifty-One
Thousand Eight Hundred Fifty (1,851,850) shares of common stock of the Issuer
and Seller hereby assigns and transfers to Purchaser, and Purchaser hereby
accepts and assumes from Seller, all of Seller's right, title, interest and
obligations under the Option Agreement. In consideration of the sale of the
Options, Purchaser hereby agrees to pay to Seller the Purchase Price as
specified in paragraph 4 hereof.
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3. Conditions Precedent. This Agreement shall be effective on the first
business day on which each of the following conditions precedent to the
effectiveness of this Agreement shall have been satisfied:
(a) Purchaser shall have received a duly executed counterpart of this
Agreement executed by Seller;
(b) Seller shall have received a duly executed counterpart of this
Agreement executed by Purchaser;
(c) Purchaser and Seller shall have received a duly executed counterpart of
this Agreement executed by Issuer; and
(d) Each of the representations and warranties of Seller and Purchaser
shall be true and correct.
4. Purchase Price. (a) The purchase price for the Options shall be an
amount (the "Purchase Price") equal to the product of the highest Price Per
Share obtained by Purchaser or any affiliate of Purchaser for the sale of any
shares of common stock of Issuer beneficially owned by Purchaser or any
affiliate of Purchaser during the twelve month period beginning on the date
hereof and ending on the first anniversary of the date hereof multiplied by One
Million Eight Hundred Fifty-One Thousand Eight Hundred Fifty (1,851,850);
provided, however, that the purchase price shall in no event be less than Three
Million Dollars ($3,000,000.00) which amount shall be earned in full as of the
date hereof.
(b) The Purchase Price shall be due and payable as follows:
(i) Purchaser shall pay to Seller, in immediately available funds, the
nonrefundable amount of Three Million Dollars ($3,000,000.00) on or
prior to the earlier of (x) March 15, 2000 and (y) the date on which
any person or group of persons owning less then ten percent (10%) of
the stock of Issuer as of the date hereof shall acquire beneficial
ownership of more than fifty percent (50%) of the outstanding common
stock of Issuer; and
(ii) Purchaser shall pay to Seller the balance of the Purchase Price
beginning on the date on which any person or group of persons owning
less then ten percent (10%) of the stock of Issuer shall acquire
beneficial ownership of more than fifty percent (50%) of the
outstanding common stock of Issuer in the same manner and at the same
time as Purchaser receives consideration for the disposition of shares
of common stock of Issuer.
With respect to any of the Purchase Price paid through the delivery of
securities, Purchaser and Seller agree that the terms of Section 12 of the
Option Agreement shall apply mutatis mutandis to such securities.
5. Adjustments to Sale of Options. In the event Purchaser does not sell all
of the Options or Common Stock to be acquired upon exercise of the Options to an
unaffiliated person or entity on or prior to the first anniversary of the date
hereof, Purchaser agrees to return to Seller, and assign and transfer to Seller,
all of Purchaser's rights, title, interest and obligations under the Option
Agreement with respect to, Options for the purchase of One Million Eight
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Hundred Fifty-One Thousand Eight Hundred Fifty (1,851,850) shares of Common
Stock of Issuer; provided, however, that the aggregate exercise price under the
Option Agreement shall be increased by Three Million Dollars ($3,000,000).
6. Representations and Warranties of Seller. Seller hereby represents and
warrants to Purchaser as follows:
(a) Seller is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has the requisite corporate
power to enter into and perform this Agreement;
(b) The execution, delivery and performance by Seller of this Agreement has
been duly authorized by all necessary corporate action on the part of Seller,
and this Agreement has been duly executed and delivered by Seller and
constitutes a valid and legally binding obligation of Seller enforceable in
accordance with its terms except that the enforceability hereof may be subject
to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or
other similar laws of general application, now or hereafter in effect, relating
to or affecting the enforcement of creditors' rights generally and general
principles of equity;
(c) the execution, delivery and performance by Seller of this Agreement and
the consummation of the transactions contemplated hereby will not violate or
conflict with (i) its Certificate of Incorporation or By-laws, (ii) any
agreement to which Seller is a party which is material to the financial
condition or business of Seller, (iii) any license, franchise or permit
applicable to Seller, or (iv) any law, regulation, order, judgment or decree
applicable to Seller;
(d) other than as may be required in connection with or in compliance with
the provisions of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), no authorization, consent or approval of, or any filing
with any governmental body or authority or any other person is necessary for
consummation by Seller of the transactions contemplated hereby; and
(e) Seller makes no representations or warranties with respect to the
business, assets, liabilities, operations, condition (financial or otherwise),
or prospects of Issuer.
7. Representations and Warranties of Purchaser. Purchaser hereby represents
and warrants to Seller as follows:
(a) Purchaser has full legal capacity, power and authority to execute and
deliver this Agreement and to perform his obligations hereunder. This Agreement
is a valid and binding obligation of Purchaser, enforceable in accordance with
its terms, except that the enforceability hereof may be subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws of general application, now or hereafter in effect, relating to or
affecting the enforcement of creditors' rights generally and general principles
of equity;
(b) the execution, delivery and performance by Purchaser of this Agreement
and the consummation of the transactions contemplated hereby will not violate or
conflict with (i) any agreement to which Purchaser is a party, or (ii) any law,
regulation, order, judgment or decree applicable to Purchaser;
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(c) other than as may be required in connection with or in compliance with
the provisions of the HSR Act, no authorization, consent or approval of, or any
filing with any governmental body or authority or any other person is necessary
for consummation by Purchaser of the transactions contemplated hereby;
(d) Purchaser has been advised that the Options and the shares of Common
Stock to be acquired upon exercise of the Options have not been registered under
the Securities Act, or any state securities laws and, therefore, cannot be
resold unless they are registered under the Securities Act and applicable state
securities laws or unless an exemption from such registration requirements is
available. Purchaser is aware that Issuer is under no obligation to effect any
such registration or comply with any exemption from registration, except as
required under the Option Agreement. Purchaser understands that no public market
now exists for any securities issued by Issuer. Purchaser is purchasing the
Options, and the Common Stock to be acquired upon exercise of the Options,
hereunder for its own account for investment, not as a nominee or agent, and not
with a view to, or for resale in connection with, the distribution thereof.
Purchaser has such knowledge and experience in financial and business matters
that Purchaser is capable of evaluating the merits and risks of such investment,
is able to incur a complete loss of such investment and is able to bear the
economic risk of such investment for an indefinite period of time. Purchaser is
an "accredited investor" as such term is defined in Rule 501 of Regulation D
under the Securities Act; and
(e) Purchaser acknowledges that he has received sufficient information
regarding Issuer to make an informed decision with respect to the purchase of
the Options, and the Common Stock to be acquired upon exercise of the Options.
8. Miscellaneous.
(a) Waivers and Amendments. Any provision of this Agreement may be amended,
waived or modified only pursuant to a written agreement executed by duly
authorized representatives of Seller and Purchaser.
(b) Governing Law. This Agreement and all actions arising out of or in
connection with this Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflicts of law
provisions of the State of New York or of any other state.
(c) Survival. The representations, warranties, covenants and agreements
made herein shall survive the execution and delivery of this Agreement.
(d) Successors and Assigns. The rights and obligations of Seller and
Purchaser shall be binding upon and benefit the successors, assigns, heirs,
administrators and transferees of the parties.
(e) Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subjects
hereof. All prior writings, communications, understandings and/or agreements are
superseded and merged herein.
(f) Notices. Any notice, request or other communication required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if personally
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delivered or mailed by registered or certified mail, postage prepaid, or by
recognized overnight courier or personal delivery, addressed:
(i) if to Seller, at:
IBM Credit Corporation
Xxxxx Xxxxxx Xxxxx
Xxxxxx, Xxx Xxxx 00000
Facsimile: 000-000-0000
Attention: Director, Commercial Financing Americas
(ii) if to Purchaser, at:
Xx. Xxxx X. Xxxxxxx III
c/o Airlie Group L.P.
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Facsimile: 000-000-0000
(g) Severability of this Agreement. If any provision of this Agreement
shall be judicially determined to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
(h) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall be deemed to constitute one instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered by their proper and duly authorized representatives as of
the date and year first written above.
SELLER:
IBM CREDIT CORPORATION,
a Delaware corporation
By:
Name:
Title:
PURCHASER:
----------------------------------------------
Dort X. Xxxxxxx III,
an individual
CONSENTED TO:
ENTEX Information Services, Inc.
By: ____________________________
Name: __________________________
Title: _________________________
STATE OF _______________________ )
)SS
COUNTY OF ______________________ )
On this ______ day of ____________, ____, before me, the subscriber, a Notary
Public in and for said county, personally appeared ____________________________
known to me to be the person(s) described in and who executed the above Guaranty
(By Individual), and who acknowledged the execution thereof to be their free act
and deed.
-------------------------------------
Notary Public
My Commission Expires: ______________
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