Exhibit 99.10
SIMON TRANSPORTATION SERVICES INC.
(a Nevada corporation)
SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT (this "Agreement") is made as of September 30,
2001, by and between Interstate Equipment Leasing, Inc. (the "Subscriber"), and
Simon Transportation Services Inc., a Nevada corporation (the "Company" and
together with the Subscriber the "Parties").
RECITALS
WHEREAS, the Company has received certain working capital advances from the
Subscriber and the Parties desire to convert the outstanding amount of such
advances to equity;
WHEREAS, the Company has duly authorized the issuance and sale of an
aggregate of 300,000 shares of the Company's Series II Preferred Shares, $.01
par value (the "Preferred Shares"), with such rights, preferences, and
limitations as are set forth in the Company's Certificate of Designation,
attached hereto as Exhibit A (the "Certificate"), and as otherwise afforded
holders of preferred shares under the Nevada General Corporation Law; and
WHEREAS, the Parties wish to reduce to written form the commitments and
undertakings contained herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants, and undertakings set forth in this
Agreement, and subject to the terms and conditions set forth in this Agreement,
the Parties hereby agree as follows:
TERMS
1. Subscriptions.
1.1 Subscriber hereby subscribes for 130,042 Preferred Shares,
representing advances by the Subscriber plus accrued interest thereon of
$2,080,670 divided by a price of $16.00 per share (the "Subscription").
1.2 Subscriber has tendered to the Company the entire purchase price
of the shares subscribed for herein through prior advances. The
subscription documents shall consist of an executed counterpart of the
signature page of this Agreement.
1.3 The Parties agree that the Subscription shall be effective as of
September 30, 2001, irrespective of the filing date of the Certificate.
2. Subscriber's Representations and Warranties. Subscriber represents,
warrants, acknowledges, and agrees that:
2.1 Subscriber is a corporation duly organized, validly existing, and
in good standing under the laws of the jurisdiction of its incorporation.
2.2 Subscriber is authorized and qualified to become a stockholder of
the Company and the person signing this Agreement on behalf of such entity
has been duly authorized by such entity to do so.
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2.3 Subscriber qualifies as an "accredited investor" (as defined under
the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (the "Act")).
2.4 Subscriber has such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Company and has obtained sufficient information from the
Company to evaluate the merits and risks of an investment in the Company.
2.5 Subscriber: (i) is acquiring the shares of the Preferred Shares
subscribed for herein for Subscriber's own account for investment only and
not with a view to the distribution, resale, or transfer thereof, and as
the sole record and beneficial holder thereof; (ii) is acquiring such
Preferred Shares without any intention of reselling or distributing such
Preferred Shares except in accordance with the provisions of the Act and
applicable state securities laws and regulations; and (iii) agrees that
such Preferred Shares shall not be sold, pledged, hypothecated, donated, or
otherwise transferred, whether or not for consideration, by Subscriber
except subject to the terms of this Agreement and upon the issuance to the
Company of a favorable opinion of its counsel acceptable to the Company and
the submission to the Company of such other evidence as may be satisfactory
to the Company and its counsel, to the effect that any such transfer shall
not be in violation of the Act, applicable state securities laws, or any
rules or regulations promulgated thereunder.
3. Company's Representations and Warranties. The Company represents,
warrants, acknowledges, and agrees that:
3.1 The Company is a corporation duly organized, validly existing, and
in good standing under the laws of the jurisdiction of its incorporation.
3.2 The Company has full power and authority (including full corporate
power and authority) to execute and deliver this Agreement and to perform
its obligations hereunder. This Agreement constitutes the valid and legally
binding obligation of the Company, enforceable in accordance with its terms
and conditions.
3.3 The Company has filed all forms, reports, schedules, statements,
and documents required to be filed by it with the Securities and Exchange
Commission (collectively, the "Company Public Reports"). Each of the
Company Public Reports was filed on a timely basis (considering filed
extensions) and complied with the Act and the Securities Exchange Act of
1934, as amended, in all material respects. None of the Company Public
Reports, as of their respective dates, (or if amended or superseded, at the
time of such subsequent filing), contained any untrue statement of a
material fact or omitted to state a material fact necessary in order to
make the statements made therein, in light of the circumstances under which
they were made, not misleading.
3.4 All of the outstanding shares of the Preferred Shares have been
duly authorized, validly issued, fully paid and nonassessable, are not
subject to, and were not issued in violation of, any preemptive (or
similar) rights, and are owned, of record and beneficially, by the Company,
free and clear of all Liens whatsoever.
3.5 The Company will promptly seek any consent, approval,
qualification, or authorization necessary in connection with the Company's
valid performance of this Agreement.
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4. Miscellaneous.
4.1 Successors and Assigns. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the Parties
(including transferees). Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the Parties hereto, or their
respective successors and assigns, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.
4.2 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which when executed and delivered shall be deemed to
be an original, and all of which counterparts taken together shall
constitute but one and the same instrument. This Agreement shall become
binding when one or more counterparts taken together shall have been
executed and delivered by the Parties. It shall not be necessary in making
proof of this Agreement or any counterpart hereof to produce or account for
any other counterparts.
4.3 Severability. In case any one or more of the provisions or parts
of a provision contained in this Agreement shall for any reason be held to
be invalid, illegal, or unenforceable in any respect in any jurisdiction,
such invalidity, illegality, or unenforceability shall not affect any other
provision or part of a provision of this Agreement or any other
jurisdiction, but this Agreement shall be reformed and construed in any
such jurisdiction as if such invalid, illegal, or unenforceable provision
or part of a provision had never been contained herein and such provision
or part shall be reformed so that it would be valid, legal, and enforceable
to the maximum extent permitted in such jurisdiction.
4.4 Entire Agreement and Amendment. This Agreement and the Warrant to
Purchase Series II Preferred Shares, both effective September 30, 2001, by
and between the Parties, constitute the entire agreement by and between the
Parties with respect to the subject matter hereof. Any provision of this
Agreement may be amended and the observance thereof may be modified,
waived, or terminated in whole or in part (either generally or in a
particular instance and either retroactively or prospectively), only by the
written consent of (i) as against the Company, only by the Company, and
(ii) as against the Subscriber, only by the Subscriber. Any amendment or
waiver effected in accordance with clauses (i) and (ii) of this paragraph
shall be binding upon the Company and the Subscriber and its or his
successors and assigns.
4.5 Further Action. Each of the Parties hereto agrees to execute all
such further instruments and documents and to take all such further action
necessary to effectuate the terms and purposes of this Agreement.
4.6 Governing Law. This Agreement and all documents contemplated
hereby, and all remedies in connection therewith, and all questions or
transactions relating thereto, shall be construed in accordance with and
governed by the laws of the State of Nevada.
4.7 Notice. Whenever notice is required to be given by any party
hereunder, such notice shall be deemed sufficient when delivered personally
against receipt or by prepaid, first-class certified mail to the Company or
the Subscriber at their addresses set forth on the signature page hereto or
to such other address as the Company or the Subscriber shall have furnished
to the party sending notice.
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4.8 Survival. All representations, warranties, and covenants herein
shall survive the consummation of the transaction contemplated hereby and
the delivery of the shares hereunder.
4.9 Legend. Certificates representing the shares subscribed for
hereunder are subject to stop transfer instructions issued by the Company
to the transfer agent prohibiting transfers thereof without registration
under the Act or unless an exemption from the registration requirements of
the Act is available in the opinion, addressed to the Company, of counsel
acceptable to the Company. Certificates evidencing ownership of shares
subscribed for hereunder shall bear the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, OR PURSUANT TO ANY
STATE SECURITIES LAWS. THESE SHARES MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED UNLESS SUCH ARE FIRST REGISTERED PURSUANT TO THE
APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR UNLESS THE COPORATION
RECEIVES A WRITTEN OPINION OF COUNSEL WHICH OPINION AND COUNSEL ARE
SATISFACTORY TO THE CORPORATION, THAT SUCH REGISTRATION IS NOT
REQUIRED.
4.10 Contingency. The Subscription shall be effective September 30,
2001, but shall be subject to the approval of the Company's stockholders at
a meeting properly noticed and held.
** REMAINDER OF PAGE INTENTIONALLY LEFT BLANK **
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IN WITNESS WHEREOF, each of the undersigned has signed this Agreement on
the date first above written.
THE SUBSCRIBER
INTERSTATE EQUIPMENT LEASING, INC.
By: /s/ Xxxxx Xxxxx
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Xxxxx Xxxxx, President
Address: 000 X. 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
THE COMPANY
SIMON TRANSPORTATION SERVICES INC.
By: /s/ Xxx Xxxxxxxx
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Xxx Xxxxxxxx, Chief Executive Officer
Address: 0000 Xxxx 0000 Xxxxx
Xxxx Xxxxxx Xxxx, Xxxx 00000
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EXHIBIT A
COMPANY'S CERTIFICATE OF DESIGNATION
