Exhibit 10.1
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of May
22, 2006, by and between COACTIVE MARKETING GROUP, INC., a Delaware corporation
("Seller"), XXXXXX XXXXXX, an individual ("Xxxxxx"), and Xxxxxx Xxxxxxx, Inc., a
Texas corporation ("Buyer").
RECITALS
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Seller owns 960.78 shares (the "Shares") of the Common Stock,
par value $1.00 per share of Buyer, which Shares constitute 49% of the issued
and outstanding shares of Common Stock of Buyer.
Xxxxxx owns 1,000 shares of Common Stock of Buyer, which
shares constitute 51% of the issued and outstanding shares of Common Stock of
Buyer.
Buyer desires to purchase the Shares from Seller, and Seller
desires to sell the Shares to Buyer, on the terms and conditions set forth
herein.
NOW, THEREFORE, in consideration of the foregoing and the
mutual promises herein made, and in consideration of the representations,
warranties, covenants and agreements herein contained, the parties agree as
follows:
ARTICLE 1
DEFINITIONS AND CONSTRUCTION
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Section 1.1 Definitions. Except as otherwise expressly provided
herein, the following terms and phrases shall have the meanings set forth below:
"Administration Agreement" means that certain Administration
and Marketing Services Agreement, dated as of March 22, 2002 and effective as of
April 1, 2002, by and between Buyer and Inmark.
"Closing" has the meaning given to such term in Section 7.1.
"Closing Date" has the meaning given to such term in Section
7.1.
"Closing Period Financial Statements" means collectively,
Buyer's balance sheet as of May 12, 2006, and Buyer's statement of profits and
loss for the period of April 1, 2006 to May 12, 2006.
"Inmark" means Inmark Services, LLC, a Delaware limited
liability company formerly known as Inmark Services, Inc.
"Buyer's New York Employees" means Xxx O' Krongly, Xxxxx
March-Xxxxxxxxxxx, Xxxx Xxxxxxxx, Xxxxx Xxxxxxx-Xxxxxxx and Xxxxx Xxxxxxx.
"Mutual Release" means the Mutual Release of Agreements and
Claims in the form attached hereto as Exhibit A.
"Retainer and Option Agreement" means that certain Retainer
and Option Agreement dated as of April 12, 2000, and effective as of March 1,
2000, among Buyer, Seller and Xxxxxx.
"Stockholders Agreement" means that certain Stockholders
Agreement, dated as of February 27, 2001, among Buyer, Seller and Xxxxxx.
"Subscription Agreement" means that certain Subscription
Agreement dated, as of February 27, 2001, among Buyer, Seller and Xxxxxx.
"Venture Agreements" means the Administration Agreement, the
Retainer and Option Agreement, the Stockholders Agreement, the Subscription
Agreement, and all other agreements, whether written or oral, other than this
Agreement, pursuant to which Buyer or Seller leases, purchases or otherwise
provides to the other, goods, services or property (real or personal).
ARTICLE 2
PURCHASE AND SALE OF SHARES
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Section 2.1 Sale. On the terms, and subject to the conditions of
this Agreement, on the Closing Date, Seller shall sell, assign, transfer, convey
and deliver to Buyer, and Buyer shall purchase from Seller, all of the right,
title and interest of Seller in and to the Shares.
Section 2.2 Purchase Price. The purchase price (the "Purchase
Price") for the Shares shall be one million one hundred thousand dollars
($1,100,000) to be paid on the Closing Date by wire transfer of immediately
available federal funds to an account designated by Seller.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER
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Seller represents and warrants to Buyer as follows:
Section 3.1 Organization; Authorization. Seller is a corporation
duly organized, validly existing and in good standing under the laws of Delaware
and has all requisite power and authority to execute and deliver this Agreement,
to carry out its obligations hereunder and to consummate the transactions
contemplated hereby. Seller has taken all necessary corporate action for the
execution and delivery of this Agreement, the performance of its obligations
hereunder and the consummation of the transactions contemplated hereby.
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Section 3.2 Ownership and Transfer of Shares. Seller is the legal
owner of the Shares and has the full right, power and authority to sell the
Shares to Buyer. Upon payment of the Purchase Price and delivery of the stock
certificate representing the Shares pursuant to Section 5, Buyer shall acquire
good title to the Shares, free and clear of any and all claims, liens, pledges,
charges, security interests, and encumbrances of any nature.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER AND XXXXXX
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Buyer and Xxxxxx, jointly and severally, represent and warrants to
Seller as follows:
Section 4.1 Organization; Authorization. Buyer is a corporation
duly organized, validly existing and in good standing under the laws of Texas
and has all requisite power and authority to execute and deliver this Agreement,
to carry out its obligations hereunder and to consummate the transactions
contemplated hereby. Buyer has taken all necessary corporate action for the
execution and delivery of this Agreement, the performance of its obligations
hereunder and the consummation of the transactions contemplated hereby.
Section 4.2 Financial Statements. Buyer has delivered to Seller
unaudited balance sheets of Buyer as at December 31, 2005 and March 31, 2006,
and unaudited statements of income of Buyer for the year ended December 31, 2005
and the three-month period ended March 31, 2006 (collectively, the "Financial
Statements"). The Financial Statements (i) present fairly the financial
condition and results of operations of Buyer as at the respective dates and for
the respective periods covered thereby, (ii) are correct and complete and comply
with generally accepted accounting principles consistently applied for the
periods covered thereby, and (iii) are consistent with the books and records of
Buyer.
ARTICLE 5
OTHER AGREEMENTS
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Section 5.1 Resignations. At Closing, each of Xxxx Xxxxxxxx and
Xxxxxx Xxxxxxx shall resign from Buyer's Board of Directors.
Section 5.2 Termination of Venture Agreements. At the Closing,
Buyer, Seller, Xxxxxx and Inmark will execute and deliver the Mutual Release,
pursuant to which, among other things, the parties thereto will terminate, and
release each other from any further obligations pursuant to, the Venture
Agreements.
Section 5.3 Seller's Cooperation with Buyer. Following the
Closing, Seller will provide Buyer with all time management records of Buyer's
New York Employees available to Seller on its internal accounting software
systems. Seller will also furnish Buyer with a payroll register documenting the
amounts due, if any, for personnel on Seller's payroll for whom reimbursements
are due through the Closing.
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Section 5.4 Buyer's Cooperation with Seller. Following the
Closing, Buyer and Xxxxxx will provide Seller with such data, records and
financial statements of Buyer (including, without limitation, the Closing Period
Financial Statements) as shall be requested by Seller in its reasonable
discretion in connection with the preparation of Seller's audited and unaudited
financial statements required to be filed by Seller with the Securities and
Exchange Commission from time to time. Buyer will provide Seller with the
Closing Period Financial Statements no later than June 7, 2006. The Closing
Period Financial Statements will (i) present fairly the financial condition and
results of operations of Buyer as at the respective dates and for the respective
periods covered thereby (ii) be correct and complete and comply with generally
accepted accounting principles consistently applied for the periods covered
thereby and (iii) will be consistent with the books and records of Buyer.
Section 5.5 Rental of New York Offices. Following the Closing,
until such time as all of Buyer's New York Employees shall have vacated Seller's
New York offices, Buyer shall continue to pay Seller (and/or its subsidiaries)
rent for space occupied by such employees at Seller's New York offices at the
rate of $4,166.67 per month. In addition, Seller may require Buyer's New York
Employees to vacate Seller's New York offices at any time after July 1, 2006
upon 30-days prior notice.
Section 5.6 Non Disparagement. Each of the parties hereto agrees
not to publish or communicate to any person or entity any disparaging remarks,
comments or statements concerning the other parties and/or their present and
former respective directors, shareholders, officers, employees, agents,
attorneys, successors and assigns. "Disparaging" remarks, comments or statements
are those that impugn the character, honesty, integrity, morality, business
acumen or abilities of the individual or entity being disparaged, or are
otherwise derogatory, disparaging or damaging.
Section 5.7 Amendment to Buyer Articles of Incorporation. Seller
hereby consents to the amendment of Buyer's Articles of Incorporation following
the Closing Date so as (i) to delete Articles 13 - 16 thereof, and (ii)
otherwise amend any other provision thereof relating to Seller as a shareholder
of Buyer.
Section 5.8 Xxxxxx'x Employment Agreement. Seller expressly
relinquishes any rights which may accrue to it following the Closing Date
pursuant to the non-competition covenants contained in Article 6 of the
Employment Agreement between Buyer and Xxxxxx dated as of February 27, 2001.
Section 5.9 Non-Solicitation. For a period of 12 months following
the Closing Date, Seller shall not actively induce or attempt to induce any of
Buyer's New York Employees to terminate his or her employment with Buyer.
Nothing in this Section 5.9 shall prohibit Seller's employment of Buyer's New
York Employee following the termination of such employee's employment with
Buyer.
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ARTICLE 6
CONDITION TO CLOSING
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Section 6.1 The obligation of Seller to consummate the
transactions contemplated by this Agreement shall be subject to Seller's
obtaining the written consent of its lender, Signature Bank, to the sale of the
Shares pursuant to this Agreement. In addition, the obligations of each party to
consummate the transactions contemplated by this Agreement shall be subject to
such party receiving the deliveries to which it is entitled to under Article 7
below.
ARTICLE 7
CLOSING
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Section 7.1 Closing Date. The closing of the transactions
contemplated by this Agreement (the "Closing") shall take place at the offices
of Kronish Xxxx Xxxxxx & Xxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, at 10:00 a.m., New York City time, on May 12, 2006 or such other
date, time and place as shall be agreed upon by Seller and Buyer (the actual
date of the Closing being herein called the "Closing Date").
Section 7.2 Closing Deliveries. At the Closing,
(a) Buyer shall (i) deliver to Seller the Purchase Price
as provided in Article 2 hereof, (ii) cause to be paid to Seller all amounts due
from Buyer to Seller and its subsidiaries through the Closing Date, a true and
complete schedule of which amounts are set forth on Schedule I hereto, and (iii)
cause to be delivered to Seller the Mutual Release duly executed by Buyer and
Xxxxxx; and
(b) Seller shall (i) deliver to Buyer the certificate
evidencing the Shares, duly endorsed in blank or accompanied by stock powers
duly executed in blank, in proper form for transfer, (ii) cause to be delivered
to Buyer the letters of resignations required by Section 5.1 above, (iii)
deliver to Buyer a certificate of its Secretary certifying a true and complete
copy of resolutions duly and validly adopted by its Board of Directors
evidencing their authorization of the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby, and (iv) cause to
be delivered to Buyer and Xxxxxx the Mutual Release duly executed by Seller and
Inmark.
ARTICLE 8
MISCELLANEOUS
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Section 8.1 Expenses. All expenses of the preparation, execution
and consummation of this Agreement and of the transactions contemplated hereby,
including, without limitation, attorneys' fees and disbursements, shall be borne
by the party incurring such expense.
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Section 8.2 Entire Agreement; Amendment. This Agreement contains
the entire understanding of the parties and supersedes all prior agreements and
understandings relating to the subject matter hereof, and this Agreement shall
not be amended except by a written instrument hereafter signed by all of the
parties hereto.
Section 8.3 Assignment. This Agreement and all of the provisions
hereof shall be binding upon and inure only to the benefit of the parties hereto
and their respective successors and assigns.
Section 8.4 Further Action. Each of the parties hereto shall use
all reasonable efforts to do, or cause to be done, all things necessary, proper
or advisable under applicable law to carry out the provisions of this Agreement,
and shall execute and deliver such instruments and other documents as may be
required to carry out the provisions of this Agreement.
Section 8.5 Headings. The headings of Sections are for reference
only and shall not limit or control the meaning thereof.
Section 8.6 Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Section 8.7 GOVERNING LAW. THE VALIDITY AND CONSTRUCTION OF THIS
AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAWS (AND NOT THE PRINCIPLES OF
CONFLICT OF LAWS) OF THE STATE OF NEW YORK.
Section 8.8 VENUE. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT MAY BE BROUGHT ONLY IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
RESIDING IN THE BOROUGH OF MANHATTAN, OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK, OR THE STATE AND FEDERAL COURTS RESIDING IN SAN
ANTONIO, BEXAR COUNTY, TEXAS, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH PARTY HERETO HEREBY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE EXCLUSIVE JURISDICTION OF THE AFORESAID
COURTS. EACH PARTY HEREBY WAIVES, AND AGREES NOT TO ASSERT, AS A DEFENSE IN ANY
ACTION, SUIT OR PROCEEDING FOR THE INTERPRETATION OR ENFORCEMENT OF THIS
AGREEMENT THAT IT IS NOT SUBJECT THERETO OR THAT SUCH ACTION, SUIT OR PROCEEDING
MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SAID COURTS OR THAT THIS AGREEMENT
MAY NOT BE ENFORCED IN OR BY SAID COURTS OR THAT ITS PROPERTY IS EXEMPT OR
IMMUNE FROM EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN
INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER
OR (PROVIDED THAT PROCESS SHALL BE SERVED IN ANY MANNER REFERRED TO IN THE
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FOLLOWING SENTENCE) THAT SERVICE OF PROCESS UPON SUCH PARTY IS INEFFECTIVE. EACH
PARTY AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION, SUIT OR PROCEEDING
AGAINST IT WITH RESPECT TO THIS AGREEMENT MAY BE MADE UPON IT IN ANY MANNER
PERMITTED BY THE LAWS OF THE STATE OF NEW YORK, THE STATE OF TEXAS, OR THE
FEDERAL LAWS OF THE UNITED STATES OR BY REGISTERED MAIL DIRECTED TO SUCH PARTY
AT ITS BUSINESS ADDRESS. SERVICE OF PROCESS IN ANY MANNER REFERRED TO IN THE
PRECEDING SENTENCE SHALL BE DEEMED, IN EVERY RESPECT, EFFECTIVE SERVICE OF
PROCESS UPON SUCH PARTY.
[Signature Page Follows]
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IN WITNESS WHEREOF, and intending to be legally bound thereby, the
parties hereto have caused this Agreement to be duly executed and delivered as
of the date and year first above written.
COACTIVE MARKETING GROUP, INC.
By: /s/ XXXX X. XXXXXXXX
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Name: Xxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
/s/ XXXXXX XXXXXX
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Xxxxxx Xxxxxx
XXXXXX XXXXXXX, INC.
By: /s/ XXXXXX XXXXXX
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Name: Xxxxxx Xxxxxx
Title: President
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EXHIBIT A
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MUTUAL RELEASE OF AGREEMENTS AND CLAIMS
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SCHEDULE I
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AMOUNT OF BUYER CLOSING OBLIGATIONS
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$17,700.00 DI invoice no. 5906, 5/11/06
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