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Exhibit 10.5
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT, dated as of December 18, 1997
(this "Agreement"), is made by and among Grant Geophysical, Inc., a Delaware
corporation ("Grant"), Xxxxxxx Associates, L.P., a Delaware limited partnership
("Xxxxxxx") and Westgate International, L.P., a Delaware limited partnership
("Westgate").
RECITALS:
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X. Xxxxxxx owns 5,963,565 shares (the "Xxxxxxx Shares") and
Westgate owns 3,341,544 shares (the "Westgate Shares," and together with the
Xxxxxxx Shares) of common stock ("Solid State Common Stock") of Solid State
Geophysical Inc., an Alberta, Canada corporation ("Solid State").
X. Xxxxx desires to purchase, and Xxxxxxx and Westgate desire
to sell, the Xxxxxxx Shares and Westgate Shares, respectively, pursuant to the
terms and conditions of this Agreement.
C. SSGI Acquisition Corporation ("SSGI"), an Alberta, Canada
corporation and a wholly owned subsidiary of Grant, has commenced a cash tender
offer (the "Tender Offer") for all of the outstanding shares of Solid State
Common Stock not held by SSGI or its affiliates. Upon the completion of the
Tender Offer and related transactions, Grant will own 100% of the outstanding
Solid State Common Stock.
NOW, THEREFORE, in consideration of the mutual promises and
subject to the terms and conditions herein set forth, the parties hereby agree
as follows:
SECTION 1. PURCHASE AND SALE OF STOCK
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1.1 PURCHASE AND SALE. Subject to Section 1.2, below Grant
hereby purchases from Xxxxxxx and Westgate, and Xxxxxxx and Westgate hereby sell
to Grant, the Xxxxxxx Shares and the Westgate Shares, respectively, in exchange
for 2,981,783 shares (the "Xxxxxxx Consideration") and 1,670,772 shares (the
"Westgate Consideration"), respectively, of common stock of Grant, par value US
$.001 per share ("Grant Common Stock"). Grant further agrees, in consideration
for the Xxxxxxx Shares, to assume Xxxxxxx'x obligation, under that certain
letter agreement dated November 24, 1997, to purchase an option (the "Option"),
held by Xxxxxxxx X. Xxxxxx, to purchase 546,285 shares of Solid State Common
Stock held by Xxxxxxx, at an exercise price of Cdn. $.92 per share after payment
of Cdn. $50,000, for Cdn. $1,359,415.30, representing the difference between the
Tender Offer Price (as defined below) and the exercise price of the Option of
Cdn. $.92 per share multiplied by 546,285 shares, less Cdn. $50,000.
1.2 SHARE CONSIDERATION ADJUSTMENT.
(a) If the final per share price paid by SSGI pursuant to the
Tender Offer (the "Tender Offer Price") is greater than Cdn $3.50 per
share, then each of the Xxxxxxx
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Consideration and the Westgate Consideration shall be adjusted as set
forth in paragraph (b) below.
(b) Subject to paragraph (a) above, Grant shall issue
additional shares of Grant Common Stock to Xxxxxxx and Westgate,
respectively, equal to the difference between (i) the product of (A)
the Conversion Price divided by US $5.00 and (B) the applicable Shares
and (ii) the applicable Share Consideration. After the completion of
the Tender Offer, Grant shall issue such additional shares (including
any payment for fractional shares as set forth below).
(c) For purposes of this Section 1.2, (i) the "applicable
Share Consideration" shall mean, with respect to Xxxxxxx, the Xxxxxxx
Consideration and, with respect to Westgate, the Westgate
Consideration; (ii) the "applicable Shares" shall mean, with respect to
Xxxxxxx, the Xxxxxxx Shares and, with respect to Westgate, the Westgate
Shares; and (iii) the Conversion Price shall be equal to the Tender
Offer Price divided by 1.4.
(d) In the event of any adjustment pursuant to this Section
1.2, no fractional shares or scrip representing fractional shares of
Grant Common Stock shall be issued. Instead of any fractional interest
in a share of Grant Common Stock that would otherwise be deliverable
upon the adjustment as set forth above, Grant shall pay to Xxxxxxx and
Westgate an amount in cash equal to their respective fractional
interests multiplied by US $5.00.
SECTION 2. MISCELLANEOUS
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2.1 GOVERNING LAW. This Agreement shall be governed by,
construed and interpreted in accordance with the internal, substantive laws of
the State of Delaware.
2.2 COUNTERPARTS. This Agreement may be executed concurrently
in two or more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
2.3 AMENDMENTS. This Agreement may be amended or modified in
whole or in part only by a writing that makes reference to this Agreement
executed by each of the parties to this Agreement.
2.4 ENTIRE AGREEMENT. This Agreement and the other agreements
and instruments expressly provided for herein, together set forth the entire
understanding of the parties hereto and supersede in their entirety all prior
contracts, agreements, arrangements, communications, discussions,
representations, and warranties, whether oral or written, among the parties.
2.5 BINDING EFFECT; ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns. No assignment of this Agreement or of any rights or
obligations hereunder may be made by Grant (by operation or law or otherwise)
without the prior written consent of Xxxxxxx and Westgate, and any attempted
assignment without such required consents shall be void.
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IN WITNESS WHEREOF, the undersigned have duly executed and
delivered this Agreement as of the date first above written.
GRANT GEOPHYSICAL, INC.
By: /s/ Xxxxx X. Xxxxx, Xx.
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Name: Xxxxx X. Xxxxx, Xx.
Title: President
XXXXXXX ASSOCIATES, L.P.
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Title: General Partner
WESTGATE INTERNATIONAL, L.P.
By: Martley International, Inc.,
attorney-in-fact
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxxx
Title: President
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