STOCK REPURCHASE AGREEMENT
THIS STOCK REPURCHASE AGREEMENT (this "AGREEMENT"), dated as of October 6,
2004, by and among GALAXY NUTRITIONAL FOODS, INC., a Delaware corporation, with
its principal place of business at 0000 Xxxxxxxx Xxx, Xxxxxxx, XX 00000 (the
"BUYER" or "COMPANY"), BH CAPITAL INVESTMENTS, LP, a Ontario limited partnership
("BH") whose address is 000 Xxxxx Xxxxxx Xxxx, Xxxxx Tower, 7th Floor, Toronto,
Ontario, Canada X0X 0X0 and EXCALIBUR LIMITED PARTNERSHIP, a Manitoba limited
partnership ("EXCALIBUR"), whose address is 00 Xxxxxx Xxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxx, Xxxxxx M5R IB2 (BH and Excalibur are referred to individually as a
"SELLER" and together as "SELLERS").
PRELIMINARY STATEMENTS
A. The Sellers are the owners of all of the Company's issued and
outstanding Series A Preferred Stock as more fully described on Schedule I
attached hereto (the "STOCK");
X. Xxxxxxx wish to convert a portion of the Stock to a number of shares of
the Company's Common Stock, par value $.01 per share (the "Common Stock") in
accordance with the conversion rights associated with the Stock and to sell to
the Company the remainder of the Stock and all rights and benefits associated
therewith on the terms and subject to the conditions set forth in this
Agreement;
C. The Company has authorized the payment of consideration as herein
provided in exchange for the assignment of all remaining rights and benefits
associated with the Stock, subject to the terms and conditions set forth in this
Agreement; and
D. Upon the closing of the transactions contemplated hereby, Company will
issue and deliver a Warrant to each of Sellers on the terms herein provided and
substantially in the respective forms attached hereto as Exhibit "A" (the
"Warrant") and the parties hereto will execute and deliver a Registration Rights
Agreement in substantially the form attached hereto as Exhibit "B" (the
"REGISTRATION RIGHTS AGREEMENT") pursuant to which the Company agrees to provide
certain registration rights (with respect to the securities issuable pursuant to
the Warrant) under the Securities Act of 1933, as amended (the "1933 Act") and
the rules and regulations promulgated thereunder, and applicable state
Securities laws.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Sellers hereby
agree as follows:
1. PREAMBLES; PURCHASE AND SALE OF SECURITIES; CLOSING
a. Preliminary Statements. The above preliminary statements,
recitals, definitions, preamble and provisions are true and correct and are
incorporated herein as fully as if set forth herein.
b. Conversion and Purchase of Stock. Subject to the terms and
conditions set forth in this Agreement, the Sellers and the Company agree to
convert a portion of the shares of Stock outstanding (the "Conversion Stock" as
so indicated on Schedule I hereto) to approximately 600,000 shares of Common
Stock in accordance with the conversion rights presently associated with the
Stock and the Sellers agree to sell the remainder of the Stock and all rights
and benefits associated therewith (the "Remaining Stock") as further indicated
on Schedule I, free and clear of all liens, claims and encumbrances whatsoever,
and Buyer agrees to purchase the Remaining Stock from the Sellers for an
aggregate purchase price of one hundred twenty percent (120%) of the sum of the
Series A Preference Amount thereof plus accrued, but unpaid dividends as of the
Closing Date (the "PURCHASE PRICE"), allocated between Sellers as indicated
under each Seller on Schedule I, together with the issuance and delivery to each
Seller a Warrant relating to 250,000 shares of Common Stock.
c. The Closing. The closing ("CLOSING") of the issuance of the
Conversion Stock and sale and purchase of the Remaining Stock (including the
issuance of the Warrants) shall take place at the offices of Xxxxx & Xxxxxxxxx
LLP, 200 South Orange Avenue, Suite 2300, SunTrust Center, Xxxxxxx, Xxxxxxx
00000, no later than October 20, 2004. The consummation of the transaction and
the payment of the Purchase Price shall occur at Closing, as follows:
(i) Conversion Stock. The Sellers shall deliver, by the close
of business the day after closing appropriately completed and executed
conversion notices under the rights presently associated with the Stock and
providing for a conversion of the appropriate portion thereof into the
Conversion Stock and Company shall direct its Stock Transfer Agent to deliver
such Conversion Stock to Sellers in accordance with the rights, designations and
preferences associated with the Stock.
(ii) Delivery of Stock Certificate(s). The Sellers shall
deliver to the Company the original certificates representing the Stock free and
clear of all liens, claims and encumbrances whatsoever and endorsed in blank or
executed Assignments Separate from Certificate in a form attached hereto as
Exhibit "C".
(iii) Execution and Delivery of Registration Rights Agreement.
The parties will execute and deliver each to the other the Registration Rights
Agreement.
(iv) Delivery of Warrant. The Company shall deliver to each
Seller a Warrant providing for the right of the holder thereof to purchase up to
250,000 shares of the Common Stock of the Company at a purchase price equal to
$2.00 per share, subject to adjustment as provided in the Warrant.
(v) Delivery of Purchase Price. The Company shall deliver the
Purchase Price in immediately available U.S. funds to each Seller, by the close
of business the day after closing, as allocated pursuant to Schedule I.
2. SELLER'S REPRESENTATIONS AND WARRANTIES
Each Seller represents and warrants to the Company that:
a. Investment Purpose. The shares of Common Stock issued upon
exercise of the Warrant ("Warrant Stock") and the Warrant itself (collectively,
referred to hereafter as the "Securities") to be delivered to such Seller are
being acquired by Seller in good faith solely for its own account, for
investment purposes only, and are not being purchased for resale, resyndication,
distribution, subdivision or fractionalization thereof; such Seller has no
contract or arrangement with any person to sell, transfer or pledge to any
person the Securities or any part thereof, any interest therein or any rights
thereto; such Seller has no present plans to enter into any such contract or
arrangement; and such Seller understands that as a result it must bear the
economic risk of the investment for an indefinite period of time because the
Securities have not been registered under the 1933 Act, and, therefore, cannot
be sold unless they are subsequently registered under the 1933 Act.
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b. Accredited Investor Status. Such Seller is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D.
c. Reliance on Exemptions. Such Seller understands that the
Securities are being offered and sold to it under the exemption from the
registration requirements of the United States federal and state Securities laws
and that the Company is relying upon the truth and accuracy of, and such
Seller's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of such Seller
to acquire the Securities.
d. Information. Such Seller understands and acknowledges that it is
purchasing the Securities without being furnished any offering literature,
prospectus or other materials other than copies of the SEC Documents (as defined
hereinbelow), that this transaction has not been scrutinized by the SEC or by
any administrative agency charged with the administration of the Securities laws
of any state, that all documents, records and books, pertaining to the Company,
its business, finances and operations, and the Securities have been made
available to such Seller, and its advisors and representatives, including its
attorney, its accountant and/or its purchaser representative, and that the books
and records of the Company will be available upon reasonable notice for
inspection by such Seller during reasonable business hours at the Company's
principal place of business. Such Seller and its advisors and representatives,
including its attorney, its accountant and/or its purchaser representative, if
any, have reviewed the SEC Documents and been afforded the opportunity to ask
questions of the Company and have received complete and satisfactory answers to
any such inquiries. Such Seller understands that its investment in the
Securities is speculative and involves a high degree of risk of loss and that
such Seller must be prepared to lose its entire investment in the Company. Such
Seller has sought such accounting, legal and tax advice, as it has considered
necessary to an informed investment decision with respect to its acquisition of
the Securities. Such Seller, or such Seller together with its purchaser
representative, if any, have such knowledge and experience in financial and
business matters that it and such representative are capable of evaluating the
merits and risks of an investment in the Securities and of making an informed
investment decision.
e. Governmental Review. Such Seller understands that no United
States federal or state agency or any other government or governmental agency
has approved or disapproved or passed on or made any recommendation or
endorsement of the Securities or the fairness or suitability of the investment
in the Securities, nor have such authorities passed upon or endorsed the merits
of the offering of the Securities or the accuracy or adequacy of any of the
information provided by the Company to such Seller regarding the Company, the
Securities or any other matter, and that the Company is relying on the truth and
accuracy of the representations, declarations and warranties herein made by such
Seller in offering the Securities for sale to it without having first registered
the same under the 1933 Act.
f. Transfer or Resale. Such Seller understands that, except as
provided in the Registration Rights Agreement, (i) the Securities have not been
and are not being registered under the 1933 Act or any state Securities laws,
and may not be transferred unless (a) subsequently registered thereunder, or (b)
such Seller shall have provided the Company with a statement of the
circumstances surrounding the proposed disposition and shall have delivered to
the Company an opinion of counsel, reasonably satisfactory in form, scope and
substance to the Company, to the effect (1) that the Securities to be sold or
transferred may be sold or transferred pursuant to an exemption from such
registration and (2) that appropriate action necessary for compliance with the
1933 Act has been taken; (ii) any sale of such Securities made in reliance on
Rule 144 promulgated under the 1933 Act may be made only in accordance with the
terms of said Rule and further, if said Rule is not applicable, any resale of
such Securities under circumstances in which the seller (or the person through
whom the sale is made) may be deemed to be an underwriter (as that term is
defined in the 0000 Xxx) may require compliance with some other exemption under
the 1933 Act or the rules and regulations of the SEC thereunder; and (iii)
neither the Company nor any other person is under any obligation to register
such Securities under the 1933 Act or any state Securities laws or to comply
with the terms and conditions of any exemption thereunder.
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g. Legends. Such Seller understands that the Stock certificates
representing the Securities shall bear a restrictive legend in substantially the
following form (and a stop-transfer order shall be placed against transfer of
such stock certificates):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE REOFFERED, SOLD, TRANSFERRED,
PLEDGED, OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER SAID ACT AND THE STATE SECURITIES
ACT OR BLUE SKY ACT OF ANY STATE HAVING JURISDICTION THEREOF, OR (B)
AN OPINION OF COUNSEL, REASONABLY SATISFACTORY IN FORM, SCOPE AND
SUBSTANCE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER
SAID ACT OR THE SECURITIES ACT OR BLUE SKY ACT OF ANY STATE HAVING
JURISDICTION WITH RESPECT THERETO.
h. Authorization; Enforcement. This Agreement and the Registration
Rights Agreement have been duly and validly authorized, executed and delivered
on behalf of such Seller and are valid and binding agreements of such Seller
enforceable in accordance with their terms, subject as to enforceability to
general principles of equity and to bankruptcy, insolvency, moratorium, and
other similar laws affecting the enforcement of creditors' rights generally.
i. Domicile. Such Seller's principal place of business is located as
indicated in the address of such Seller on the signature page to this Agreement.
j. Short Position and Market Purchases. Such Seller is not acquiring
the Securities or the Conversion Stock for the purpose of covering any short
position in the Securities as of Closing.
k. Stock Free of Claims. The Stock to be delivered at Closing by
such Seller hereunder is and will be so delivered free and clear of all liens,
claims, encumbrances, pledges, orders or restrictions whatsoever.
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l. No Conflicts. The execution, delivery and performance of this
Agreement by such Seller and the consummation by such Seller of the transactions
contemplated hereby will not (i) result in any violation of such Seller's
Certificate of Limited Partnership, as amended, as in effect on the date hereof
or such Seller's Limited Partnership Agreement, as in effect on the date hereof
or (ii) conflict with, or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or give to others any
rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which such Seller is a party, or result in
a violation of any law, rule, regulation, order, judgment or decree (including
federal and state securities laws and regulations) applicable to such Seller or
by which any property or asset of such Seller is bound or affected (except for
such conflicts, defaults, terminations, amendments, accelerations, cancellations
and violations as would not, individually or in the aggregate, have a material
adverse effect on such Seller's ability to perform its obligations hereunder).
Except as required under the 1933 Act and any applicable state securities laws,
such Seller is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency in order
for it to execute, deliver or perform any of its obligations under this
Agreement in accordance with the terms hereof.
m. Indemnification. Such Seller acknowledges that such Seller
understands the meaning and legal consequences of the representations and
warranties in this Section 2, and that the Company has relied upon such
representations and warranties, and such Seller hereby agrees to indemnify and
hold harmless the Company and its officers, directors, shareholders, agents and
representatives from and against any and all claims, demands, losses, damages,
expenses or liabilities (including attorneys' fees) due to or arising out of,
directly or indirectly, a breach of any such representations or warranties, as
well as any breach of such Seller's covenant provided in Section 4 d. hereof.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each Seller that:
a. Organization and Qualification. The Company is a corporation duly
organized and existing in good standing under the laws of the State of Delaware,
and has the requisite corporate power to own its properties and to carry on its
business as now being conducted. The Company is duly qualified as a foreign
corporation to do business and is in good standing in every jurisdiction in
which the nature of the business conducted by it makes such qualification
necessary and where the failure so to qualify would have a material adverse
effect on the operations, properties or financial condition of the Company taken
as a whole (a "MATERIAL ADVERSE EFFECT").
b. Authorization; Enforcement. (i) The Company has the requisite
corporate power and authority to enter into and perform this Agreement and the
Registration Rights Agreement and to issue the Securities in accordance with the
terms hereof and thereof, (ii) the execution and delivery of this Agreement and
the Registration Rights Agreement by the Company and the consummation by it of
the transactions contemplated hereby have been duly authorized by the Company's
Board of Directors and no further consent or authorization of the Company, its
Board of Directors, or its stockholders is required, (iii) this Agreement and
the Registration Rights Agreement have been duly executed and delivered by the
Company, and (iv) this Agreement and the Registration Rights Agreement
constitute the valid and binding obligations of the Company enforceable against
the Company in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally, the enforcement
of creditors' rights and remedies or by other equitable principles of general
application.
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c. Issuance of Securities. The Warrant is and the Warrant Stock to
be issued pursuant to the Warrant upon exercise and issuance thereof will be
duly authorized and, upon issuance in accordance with the terms hereof or
thereof, shall be validly issued, fully paid and non-assessable, and free from
all taxes, liens and charges with respect to the issue thereof.
d. No Conflicts. The execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby will not (i) result in any violation of the Company's
Certificate of Incorporation, as amended, as in effect on the date hereof or the
Company's Bylaws, as in effect on the date hereof or (ii) conflict with, or
constitute a default (or an event which with notice or lapse of time or both
would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or
instrument to which the Company is a party, or result in a violation of any law,
rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations) applicable to the Company or by which any
property or asset of the Company is bound or affected (except for such
conflicts, defaults, terminations, amendments, accelerations, cancellations and
violations as would not, individually or in the aggregate, have a Material
Adverse Effect). Except as required under the 1933 Act and any applicable state
securities laws, the Company is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
governmental agency in order for it to execute, deliver or perform any of its
obligations under this Agreement in accordance with the terms hereof.
e. Common Stock. The Company has registered its Common Stock
pursuant to Section 12(b) or (g) of the 1934 Act (as defined below) and is in
full compliance with all reporting requirements of the 1934 Act, and the Company
is in compliance with all requirements for the continued listing or quotation of
its Common Stock, and such Common Stock is currently listed or quoted on, the
Principal Market. As of the date hereof, the Principal Market is the American
Stock Exchange, and except as set forth in the SEC Documents, the Company has
not received any notice regarding, and to its knowledge there is no threat of,
the termination or discontinuance of the eligibility of the Common Stock for
such posting or listing.
f. SEC Documents, Financial Statements. During the Company's last
two (2) fiscal years, the Company has filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the "1934 ACT") (all of the foregoing filed prior to the date hereof and all
exhibits included therein and financial statements and schedules thereto and
documents (other than exhibits) incorporated by reference therein, being
hereinafter referred to herein as the "SEC DOCUMENTS"). As of their respective
dates, subject to, with respect to certain SEC Documents, the filing of an
amendment to such SEC Documents, the SEC Documents complied in all material
respects with the requirements of the 1934 Act and the rules and regulations of
the SEC promulgated thereunder applicable to the SEC Documents, and none of the
SEC Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. As of their
respective dates, the financial statements of the Company included in the SEC
Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim
statements, to the extent they may exclude footnotes or may be condensed or
summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments).
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g. No Material Adverse Change. Since June 30, 2004, there has not
been any material adverse change in the Company's business, results of
operations, or financial condition, other than changes resulting from general
economic conditions or general economic trends, except as reflected in the SEC
Documents filed at least five (5) days prior to the date hereof.
h. Absence of Litigation. Except as disclosed in the SEC Documents,
there is no action, suit, proceeding, inquiry or investigation before or by any
court, public board or body pending or, to the knowledge of the Company,
threatened against the Company, wherein an unfavorable decision, ruling or
finding would have a Material Adverse Effect or which would adversely affect the
validity or enforceability of, or the authority or ability of the Company to
perform its obligations under, this Agreement or any of the documents
contemplated herein.
4. COVENANTS
a. Form D. The Company agrees to file a Form D with respect to the
Securities as required under Regulation D and to provide a copy thereof to Buyer
promptly after such filing.
b. Reporting Status. Until the earlier of (i) the date as of which
Buyer may sell all the Warrant Stock without restriction pursuant to Rule 144(k)
promulgated under the 1933 Act, or (ii) the date on which Buyer has sold all of
the Warrant Stock, the Company shall file all reports required to be filed with
the SEC pursuant to the 1934 Act, and the Company shall not terminate its status
as an issuer required to file reports under the 1934 Act even if the 1934 Act or
the rules and regulations thereunder would permit such termination.
c. Original Stock Certificates. In the event either Seller delivered
an Assignment Separate from Certificate in lieu of an original stock certificate
or certificates under Section 1c(ii) hereof, such Seller covenants to deliver
the original certificate free and clear, from and after the Closing Date, of all
liens, claims and encumbrances whatsoever (and appropriately endorsed in favor
of the Company and relating to all Remaining Stock), within twenty (20) days of
the Closing Date.
5. TRANSFER AGENT INSTRUCTIONS
Each Seller acknowledges that the Securities shall be "restricted"
Securities, that the Stock Certificates and Warrant shall bear the restrictive
legend specified in Section 2(g) of this Agreement, and that stop-transfer
instructions have been given by the Company to its transfer agent with respect
to the Securities. If a Seller provides the Company with an opinion of counsel,
reasonably satisfactory in form, scope and substance to the Company, that
registration of a resale by such Seller of any of the Securities is not required
under the 1933 Act or any applicable state securities or blue sky laws, the
Company shall permit the transfer and promptly instruct its transfer agent to
electronically issue such Securities in such name and in such denominations as
specified by such Seller.
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6. TERMINATION
a. Termination. This Agreement may be terminated as follows:
(i) at any time prior to Closing, by mutual written consent of
all of the parties to this Agreement;
(ii) at any time after October 20, 2004, by Sellers, if the
Closing has not been effected on or prior to such date and if such Seller is not
then in breach of any term of this Agreement, pursuant to written notice by
Sellers to the Company; or
(iii) at any time after October 20, 2004, by the Company, if
the Closing has not been effected on or prior to such date, if the Company is
not then in breach of any term of this Agreement, pursuant to written notice by
the Company to Sellers.
b. Effect of Termination. All obligations of the parties hereunder
shall cease upon any termination pursuant to Section 6.a., provided, however,
that the provisions of Section 7 hereof shall survive any termination of this
Agreement.
7. GOVERNING LAW; MISCELLANEOUS
a. Governing Law. This Agreement shall be governed by and
interpreted in accordance with the laws of the State of Delaware without regard
to the principles of conflict of laws.
b. Counterparts. This Agreement may be executed in two or more
identical counterparts, all of which shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each
party and delivered to the other party. In the event any signature page is
delivered by facsimile transmission, the party using such means of delivery
shall cause three (3) additional original executed signature pages to be
physically delivered to the other party within five (5) days of the execution
and delivery hereof.
c. Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this
Agreement.
d. Severability. If any provision of this Agreement shall be invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability shall
not affect the validity or enforceability of the remainder of this Agreement or
the validity or enforceability of this Agreement in any other jurisdiction.
e. Entire Agreement; Amendments. This Agreement and the instruments
referenced herein contain the entire understanding of the parties with respect
to the matters covered herein and therein and, except as specifically set forth
herein or therein, neither the Company nor any Seller makes any representation,
warranty, covenant or undertaking with respect to such matters. No provision of
this Agreement may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.
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f. Notices. Any notices required or permitted to be given under the
terms of this Agreement shall be sent by mail or delivered personally or by
courier and shall be effective five days after being placed in the mail, if
mailed, certified or registered, return receipt requested, or upon receipt, if
delivered personally or by courier, in each case addressed to a party. The
addresses for such communications shall be:
If to the Company: Galaxy Nutritional Foods, Inc.
0000 Xxxxxxxx Xxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xx. Xxxxxxx X. Xxxxx
With a copy to: Xxxxx & Xxxxxxxxx LLP
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
If to BH: BH Capital Investments, L.P.
000 Xxxxx Xxxxxx Xxxx
Xxxxx Tower, 7th Floor
Toronto, Ontario, Canada X0X 0X0
Telecopy: (000) 000-0000
If to Excalibur: Excalibur Limited Partnership
00 Xxxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X0X IB2
Telecopy: (000) 000-0000
Each party shall provide notice to the other party of any change in address.
g. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and assigns. No party
shall assign this Agreement or any rights or obligations hereunder without the
prior written consent of the other (which consent may be withheld for any reason
in the sole discretion of the party from whom consent is sought).
h. Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and
assigns, and is not for the benefit of, nor may any provision hereof be enforced
by, any other person.
i. Publicity. The Company and each Seller shall have the right to
approve before issuance any press releases or any other public statements with
respect to the transactions contemplated hereby; provided, however, that the
Company shall be entitled, without the prior approval of each Seller, to make
any press release with respect to such transactions as the Company determines is
required by applicable law and regulations.
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j. Further Assurances. Each party shall do and perform, or cause to
be done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, Buyer and the Company have caused this
Securities Purchase Agreement to be duly executed as of the date first written
above.
"Company"
GALAXY NUTRITIONAL FOODS, INC.
By: /s / Xxxxxxx X. Xxxxx
-------------------------------------------
Xxxxxxx X. Xxxxx
Chief Executive Officer
"Seller"
BH CAPITAL INVESTMENTS, LP
By: HB and Co., its General Partner
By: /s/ Xxxxx Xxxxxxxxx
----------------------------------------
Print Name: Xxxxx Xxxxxxxxx
--------------------------------
As its: President of General Partner
------------------------------------
Address: 000 Xxxxx Xxxxxx Xxxx
Xxxxx Tower, 7th Floor
Toronto, Ontario, Canada X0X 0X0
"Seller"
EXCALIBUR LIMITED PARTNERSHIP
By: Excalibur Capital Management, Inc.
By: /s/ Will Hechter
----------------------------------------
Print Name: Will Hechter
--------------------------------
As its: President of General Partner
------------------------------------
Address: 00 Xxxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx, Xxxxxx X0X IB2
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SCHEDULE I
GALAXY NUTRITIONAL FOODS, INC.
SCHEDULE I
STOCK REPURCHASE AGREEMENT
PURCHASE CALCULATION AS OF OCTOBER 6, 2004
------------------------------------------
Total BH Capital Excalibur
---------------------------------------------------
Series A original value $ 48.18 $ 48.18 $ 48.18
10% Dividends fiscal 2002 4.82 4.82 4.82
8% Dividends fiscal 2003 3.85 3.85 3.85
8% Dividends fiscal 2004 3.85 3.85 3.85
8% Dividends fiscal 2005 (accrued dividends to 10/5/04) 1.96 1.96 1.96
---------------------------------------------------
Total Value per Conversion Share $ 62.66 $ 62.66 $ 62.66
Conversion price 1.0735 1.0735 1.0735
---------------------------------------------------
No. of common shares per share of Conversion Stock 58.37 58.37 58.37
===================================================
Conversion Stock 10,278 5,139 5,139
---------------------------------------------------
Common Stock Issued for Conversion Stock 599,970 299,985 299,985
---------------------------------------------------
Remaining Stock 30,316 14,591 15,725
Preference Amount of Remaining Stock - principal $ 1,460,589.71 $ 702,977.45 $ 757,612.26
Preference Amount of Remaining Stock - dividend $ 439,150.64 $ 211,361.89 $ 227,788.75
---------------------------------------------------
Total Base Value $ 1,899,740.35 $ 914,339.34 $ 985,401.01
===================================================
---------------------------------------------------
Purchase Price of Remaining Stock/Accrued Dividends $ 2,279,688.42 $ 1,097,207.21 $ 1,182,481.21
---------------------------------------------------
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