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Exhibit 10.31
REDEMPTION AGREEMENT
This Redemption Agreement (this "Agreement") is effective November 3,
2000 (the "Effective Date"), by and between N2H2, Inc., a Washington corporation
("N2H2"), and Xxxx X. Xxxxxx (the "Shareholder").
RECITALS
A. Shareholder has borrowed $600,000 from N2H2 and, as of the date
hereof, owes N2H2 $611,967.13 of principle and accrued interest (the
"Outstanding Debt").
B. Shareholder agrees to repay a portion of the Outstanding Debt by
selling 358,549 shares of N2H2's common stock (the "Shares") to N2H2, and N2H2
desires to redeem the Shares in partial repayment of the Debt and to forgive the
remaining balance thereof.
AGREEMENT
NOW THEREFORE, in consideration of the mutual promises set forth herein,
the parties agree as follows:
1. Redemption. The Shareholder agrees to sell and surrender to N2H2 for
redemption and N2H2 agrees to purchase and redeem from Shareholder the Shares
pursuant to the terms and subject to the conditions set forth in this Agreement.
2. Purchase Price and Loan Forgiveness. The purchase price for the
Shares shall be $538,648.16, which is the product obtained by multiplying
$1.5023 (the average high and low daily final trading price of N2H2's common
stock on the NASDAQ National Market of the last 20 trading days prior to the
Effective Date) by 358,549, the number of Shares (the "Purchase Price"). N2H2
agrees to forgive the remaining portion of the Outstanding Debt.
3. Payment. Subject to the terms and conditions of this Agreement and in
reliance on the representations, warranties and agreements of Xxxxxxxxxxx, X0X0
shall, at closing, pay the Purchase Price by reducing the amount of Outstanding
Debt by the Purchase Price against delivery of the Shares to N2H2 with stock
powers properly endorsed by the Shareholder.
4. Closing. The "Closing" of the transaction contemplated herein shall
take place at the offices of N2H2, at 5:00 p.m., on the Effective Date.
5. Representations and Warranties of Shareholder. Shareholder represents
and warrants to N2H2 as follows:
a. Title. At Closing, upon delivery of the certificates
representing the Shares properly endorsed by Shareholder, ownership of the
Shares will vest in N2H2 free and clear of all claims, rights, liens and
encumbrances whatsoever.
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b. Access to Information. Shareholder currently serves as the
Chief Financial Officer of N2H2. As a result of that office, the Shareholder has
been afforded full opportunity (i) to meet with, ask questions of, and receive
answers from N2H2 and the management of N2H2 in connection with a determination
by the Shareholder to enter into this Agreement and to consummate the
transactions contemplated by this Agreement and all such questions have been
answered to the full satisfaction of the Shareholder; and (ii) to examine N2H2's
financial and corporate records.
c. Opportunity to Consult Independent Counsel. Shareholder
acknowledges that N2H2 has recommended that he obtain the advice of independent
legal and tax counsel with respect to the transaction contemplated herein.
d. No Reliance. Shareholder is not relying on any statement,
representation or warranty of N2H2 or any of its shareholders, officers,
directors, employees or agents in entering into this transaction.
e. No Claims. Shareholder does not have any claim whatsoever
against N2H2 or against any of its officers or directors relating, in any way,
to N2H2.
F. SHAREHOLDER'S RELEASE. THE SHAREHOLDER HEREBY RELEASES AND
FOREVER DISCHARGES N2H2 AND ITS SUBSIDIARIES AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS FROM AND AGAINST ALL
DAMAGES, LIABILITIES, COSTS, EXPENSES, (INCLUDING REASONABLE ATTORNEYS AND
ACCOUNTANTS FEES) AND ACTIONS, CAUSES OF ACTION, OR SUITS OF ANY KIND OR NATURE
WHATSOEVER, WHICH MAY HAVE ARISEN OR WHICH MAY ARISE OUT OF HIS OWNERSHIP OF THE
SHARES EXCEPT THAT N2H2, INC.WILL INDEMNIFY XXXXXX IN CONNECTION WITH HIS
ACTIVITIES AS AN EMPLOYEE AND OFFICER OF THE CORPORATION TO THE FULL EXTENT
PROVIDED UNDER ANY N2H2 APPLICABLE INSURANCE POLICIES NOW IN EFFECT, OR THAT
BECOME EFFECT IN THE FUTURE AND RELATE TO EVENTS DURING XXXXXX'X EMPLOYMENT.
g. Indemnification. Each party (an "Indemnitor") shall hold
harmless, indemnify and defend the other party against and from any damage,
loss, expense or liability, including reasonable attorneys' and accountants'
fees, resulting from or arising out of a breach or default in the performance by
the breaching or defaulting party of any of the terms, covenants,
representations, warranties or conditions of this Agreement.
h. Survival of Representations and Warranties. The
representations and warranties of the Shareholder in this Agreement will survive
the Closing.
6. Miscellaneous.
6.1 Entire Agreement. This Agreement contains the entire
agreement among the parties with respect to the transactions contemplated
hereby, and supersedes all prior agreements, documents and understandings,
written or oral, with respect thereto.
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6.2 Governing Law. This Agreement and the rights and obligations
of the parties hereto shall be governed by, and construed and enforced in
accordance with, the laws of the State of Washington applicable to agreements
made and to be performed therein by residents thereof.
6.3 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns and legal representatives.
6.4 No Third-Party Beneficiaries. Nothing in this Agreement is
intended or shall be construed to give any person, other than the parties
hereto, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
6.5 Construction of This Agreement. The article, section and
paragraph headings in this Agreement are for convenience only, and shall not
control or affect the meaning or construction of any provision of this
Agreement. This Agreement shall not be interpreted or construed against the
drafter hereof by reason of being the drafter hereof.
6.6 Remedies. The parties hereto agree that money damages or
other remedies at law would not be sufficient or adequate remedy for any breach
or violation of, or a default under, this Agreement by them and that, in
addition to all other remedies available to them, each of them shall be entitled
to an injunction restraining such breach, violation or default or threatened
breach, violation or default and to any other equitable relief, including
specific performance, without bond or other security being required.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
N2H2, INC.: SHAREHOLDER:
By: /s/ XXXXX X. XXXXXXXXX /s/ XXXX X. XXXXXX
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Xxxxx X. Xxxxxxxxx, Ph.D. Xxxx X. Xxxxxx
President and Chief Executive Officer
/s/ XXXXXXXX X. XXXXXX
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Xxxxxx (spouse)
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