Exhibit 4.1
DATED 18 December 2001
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(1) XXXXXXXX XXXX XXXXXXXX
(2) HLM DESIGN, INC
PUT AND CALL OPTION AGREEMENT
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PUT AND CALL OPTION AGREEMENT
THIS AGREEMENT is made the 18th day of December 2001
PARTIES:
(1) XXXXXXXX XXXX XXXXXXXX of 00 Xxxxxxxxx Xxxx Xxxx, Xxxxxxxxx Xxxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxxx X0 0XX ("the Shareholder")
(2) HLM DESIGN, INC a Delaware Corporation with an office at Suite 2950, 000
Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx, 00000-0000, XXX ("HLM")
RECITALS:
(A) GA Design International (Holdings) Limited ("GA") is a wholly owned
subsidiary of HLM.
(B) GA is purchasing the entire issued share capital of HLM Architects Ltd
pursuant to the Stock Purchase Agreement.
(C) The Shareholder is one of the Sellers of the share capital of HLM
Architects Ltd and is due to be issued shares in GA as part satisfaction of
the purchase consideration for his shares in HLM Architects Ltd such shares
being issued in such numbers and on such dates as is briefly set out in the
Schedule to this Agreement and all as more particularly described in the
Stock Purchase Agreement.
(D) The parties have agreed to grant each other options over such shares in GA
on the basis set out in this agreement
1 Definitions and Interpretations
In this Agreement unless there is something in the subject or context which is
inconsistent, the following expressions have the following meanings:
"Completion Date/s" Means the last working day of a period 5
days commencing with a relevant Exercise
Date
"Encumbrance" Means any charge, lien, equity, third
party right, option, right of
pre-emption or any other encumbrance,
priority, or security interest of
whatsoever nature other than any such
arising under the Articles
"Exercise Date" Means the date of service of an Option
Notice
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"First Option Period" Means the period of 5 days commencing
with the First Anniversary of the Stock
Purchase Agreement or if later the issue
by GA of the First Option Shares
"First Option Shares" Means the number of shares in GA shown
in the Schedule as due to be issued to
The Shareholder on the First Anniversary
of the Stock Purchase Agreement
"Fourth Option Period" Means the period of 5 days
commencing with the Fourth
Anniversary of the Stock Purchase
Agreement or if later the issue by
GA of the Fourth Option Shares
"Fourth Option Shares" Means the number of shares in GA
shown in the Schedule as due to be
issued to the Shareholder on the
Fourth Anniversary of the Stock
Purchase Agreement
"HLM Stock Means the shares in HLM's Common
Stock having $.001 par value and
which may be issued to the
Shareholder under the provisions of
this agreement
"Option Notice" Means a notice exercising an Option
"Option Period/s" Means any or all of the First
Option Period, the Second Option
Period, the Third Option Period or
the Fourth Option Period
"Option Shares" Means any or all of the First
Option Shares, the Second Option
Shares, the Third Option Shares and
the Fourth Option Shares as the
context may require
"Option/s" Means one or more of the First
Option Shares the Second Option
Shares the Third Option Shares or
the Fourth Option Shares as the
context requires
"Second Option Period" Means the period of 5 days
commencing with the Second
Anniversary of the Stock Purchase
Agreement or if later the issue by
GA of the Second Option Shares
"Second Option Shares" Means the number of shares in GA
shown in the Schedule as due to be
issued to the Shareholder on the
Second Anniversary of the Stock
Purchase Agreement
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"Stock Purchase Agreement" Means a Stock Purchase Agreement
having even date herewith and made
between inter alia the Shareholder,
GA, HLM Architects Ltd and HLM.
"Third Option Period" Means the period of 5 days
commencing with the Third
Anniversary of the Stock Purchase
Agreement or if later the issue by
GA of the Third Option Shares
"Third Option Shares" Means the number of shares in GA
shown in the Schedule as due to be
issued to The Shareholder on the
Third Anniversary of the Stock
Purchase Agreement
"Transfer Terms" Means that the Option Shares shall
be transferred by the Shareholder
with full title guarantee and free
from any encumbrance and together
with all rights attaching thereto
as at the Exercise Date or at any
time thereafter
1.1 Expressions in the singular shall include the plural and vice versa and in
one gender shall include all genders.
1.2 References to any statute or statutory provisions shall be construed as
references to such statute or statutory provision as respectively amended
or re-enacted or as their operation is modified by and any other statute or
statutory provision (whether before or after the date of this Agreement)
and shall include any provisions of which they are re-enactments) (whether
with or without modification) which shall include subordinate legislation
made under the relevant statute.
1.3 References to recitals, clauses and schedules are references to recitals
and clauses of and schedules to this Agreement.
1.4 The Schedule forms part of this Agreement.
2 Options
2.1 The Shareholder hereby grants to HLM the right to require him to transfer
to HLM the Option Shares shown in column 1 of the Table below in exchange
for the issue by HLM to The Shareholder of the number of shares in HLM
shown opposite in column 2 of the Table such rights in respect of such
shares to be exercised in the periods shown opposite in column 3 of the
Table.
2.2 HLM hereby grants to the Shareholder the right to require HLM to take a
transfer from him of
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the Option Shares shown in column 1 of the Table below in exchange for the
issue by HLM to The Shareholder of the number of shares in HLM shown
opposite in column 2 of the Table such rights in respect of such shares to
be exercised in the periods shown opposite in column 3 of the Table.
Column 1 Column 2 Column 3
No. of Shares in GA to be No. of Shares to be issued Period during with action to be
transferred by HLM exercised
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The First Option Shares 329 The First Option Period
The Second Option Shares 329 The Second Option Period
The Third Option Shares 329 The Third Option Period
The Fourth Option Shares 328 The Fourth Option Period
2.3 The service by either party on the other of a notice exercising any of its
Options hereunder shall automatically terminate and extinguish the right of
the other party to exercise his Option in respect of the same parcel of
shares.
3 Adjustments necessary to Option Shares
If any right of set off to which GA is entitled under the Stock Purchase
Agreement is exercised by GA against the Option Shares or any of them or for any
other reason the number of shares being issued by GA shall be less than the
number shown in the Schedule below then the rights granted by clauses 2.1 and
2.2 of this agreement shall operate on such reduced number of shares and the
number of HLM Shares to be issued in exchange by HLM shall be reduced
proportionately
4 Completion
4.1 The Options shall be completed on their respective Completion Dates.
4.2 On the relevant Completion Date the Shareholder shall hand to HLM his share
certificate(s) together with a duly executed transfer of the relevant
Option Shares and HLM shall hand the Shareholder the share certificate in
his name for the relevant number of shares in HLM to which he is then
entitled.
5 Ownership and Title to GA Shares
5.1 The Shareholder shall transfer the Option Shares on the Transfer Terms.
5.2 In relation to the Option Shares the Shareholder undertakes not to:
5.2.1 dispose of any legal or beneficial interest in them nor grant any
option over them
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5.2.2 create or allow to be created any encumbrance over them.
6 Securities Laws Matters
6.1 The Shareholder acknowledges that the securities of HLM issuable in the
future to the Shareholder upon any conversion of or exchange for the Option
Shares (the said securities together with the options and/or warrants to
purchase Securities of HLM issued to the Seller in connection with the
closing of the Stock Purchase Agreement and the Securities of HLM
underlying such options and/or warrants being collectively referred to as
the "Securities") have not been, and will not be, registered under the
United States Securities Act of 1933, as amended (the "Securities Act"), or
under any other applicable securities laws, and may not be offered or sold,
and in the case of options and warrants, exercised, in the United States,
its territories and possessions or offered and sold to, and in the case of
options and warrants, exercised by or on behalf of, "US Persons", as
defined in Rule 902(k) of Regulation S (Rule 901 through Rule 905, and
Preliminary Notes) promulgated by the U.S. Securities and Exchange
Commission under the Securities Act ("Regulation S"), unless such sale or
exercise, as the case may be, is in accordance with the provisions of
Regulation S or unless the Securities are registered under the Securities
Act and any other such other applicable securities laws, or an exemption
from the registration requirements of the Securities Act and any such other
applicable securities laws is available. Further, such Securities shall be
subject to other agreements including but not limited to the Stockholders
Agreement referred to in clause 1 hereof, restricting their transferability
and setting forth certain other restrictions.
6.2 The Shareholder certifies, represents and warrants that the Shareholder
6.2.1 Is not a US Person because he is not a citizen of the United States
and his residence and principal place of work is located in the United
Kingdom,
6.2.2 Is not acquiring the Securities for the account or benefit of any US
Person,
6.2.3 Was outside of the United States when the offer of the Securities was
made to him and
6.2.4 is outside of the United States at the time of entering into this
Agreement.
6.3 The Shareholder represents and warrants that:-
6.3.1 He is well versed in financial matters and has such knowledge and
experience in financial and business matters and that he is fully
capable of understanding the merits and risks of the investment being
made in the Securities and the risks involved in connection therewith;
and
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6.3.2 He is acting herein for his own account and is acquiring these
Securities for investment without a view to the resale or other
distribution thereof. The Shareholder is financially able to hold the
Securities for long term investment, believes that the nature and
amount of the Securities to be acquired hereunder is consistent with
his overall investment programme and financial position, and
recognises that there are substantial risks involved in an investment
in the Securities; and
6.3.3 He has received and reviewed the prospectus dated June 12, 1998
relating to the initial public offering of the Common Stock of HLM,
its annual report on Form 10-K for the fiscal years ended April 28,
2000 and April 27, 2001.
6.4 The Shareholder acknowledges and agrees that
6.4.1 he shall only offer and resell, or in the case of options or
warrants, exercise, the Securities pursuant to registration under the
Securities Act and under any other applicable securities laws, or in
accordance with the provisions of Regulation S and/or pursuant to an
available exemption from such registration requirements, as
established through the delivery of evidence satisfactory to HLM,
including, if requested, the delivery of an opinion of counsel (such
opinion and counsel each being satisfactory to HLM), to the effect
that such registration is not required,
6.4.2 he shall not engage in hedging transactions with regard to the
Securities unless in compliance with the Securities Act and
6.4.3 a legend substantially similar to the following will be placed on the
certificates representing the Securities:
THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS
PROHIBITED EXCEPT PURSUANT TO REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND UNDER
ANY OTHER APPLICABLE SECURITIES LAWS, OR UPON THE DELIVERY OF EVIDENCE
SATISFACTORY TO THE ISSUER HEREOF, INCLUDING, IF REQUESTED, THE
DELIVERY OF AN OPINION OF COUNSEL SUCH OPINION AND COUNSEL EACH BEING
SATISFACTORY TO THE ISSUER HEREOF, TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED BECAUSE SUCH TRANFER IS PURSUANT TO
AVAILABLE EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS AND/OR SUCH
TRANSFER IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S
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PROMULGATED UNDER THE SECURITIES ACT.
HEDGING TRANSACTIONS INVOLVING THE SECURITIES REPRESENTED BY THIS
CERTIFICATE MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE
SECURITIES ACT.
6.5 The Parties hereby acknowledge and agree that HLM will refuse to register,
any transfer, and in the case of options and warrants, to allow the
exercise of, and shall cause the transfer agent for the HLM Common Stock to
refuse to register any transfer, or in the case of options and warrants, to
allow the exercise of, the Securities not made in accordance with the
provisions of Regulation S, pursuant to registration under the Securities
Act, or pursuant to an available exemption from such registration.
7 Other Requirements
Prior to delivery of the first instalment of HLM Stock the Shareholder shall be
required to execute
7.1 The then current form of HLM Stockholders' Agreement, which shall be
substantially in the form attached hereto as Exhibit 1 which Stockholders'
Agreement shall be applicable to all of the Shareholder's HLM Stock; and
7.2 a Registration Rights Agreement, which shall be substantially in the form
attached hereto as Exhibit 2.
8 Reservation of Shares
HLM shall reserve on its books sufficient shares of the HLM Stock required to
satisfy all the Stock to be issued by HLM under this Option Agreement.
9 Further Assurance
HLM and the Shareholder will enter into and execute such documentation and deeds
as may be necessary to give full force and effect to the Options.
10 Notices
Any notice or direction required or permitted to be given under this Agreement
shall be in writing and shall be sent to the Shareholder's usual residential
address or to such other address in England as he may designate by notice to the
other parties in accordance with this Clause 10 and in the case of the Vendor be
sent to its registered office from time to time. Any such notice or direction
shall be delivered personally or sent in a pre-paid letter by the [recorded
delivery] service and shall be deemed to have been served if by delivery when
delivered and if by [recorded delivery] 48 hours after posting.
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11 General
11.1 This Agreement may not be assigned in whole or in part. It is binding upon
the Shareholder his personal representatives and other successors.
11.2 The clause headings in this Agreement are inserted for convenience only and
are not intended to affect the meaning or interpretation of this Agreement.
11.3 This Agreement shall be governed by, construed and interpreted in
accordance with English law and the parties submit to the jurisdiction of
the English Court. If any provision of this Agreement shall be held to be
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not be in any way affected
or impaired thereby.
11.4 The parties agree that this Agreement constitutes the complete and
exclusive statement of the Agreement between them, and supersedes all
agreements, understandings, proposals, oral or written, and all other
communications between them relating to the subject matter of this
Agreement, provided that nothing in this Agreement shall be construed as
excluding liability for fraudulent misrepresentation.
SCHEDULE
Intended Date of Issue No. of Shares in GA
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First Anniversary of the Stock Purchase Agreement 15 ("the First Option Shares")
Second Anniversary of the Stock Purchase Agreement 15 ("the Second Option Shares")
Third Anniversary of the Stock Purchase Agreement 15 ("the Third Option Shares")
Fourth Anniversary of the Stock Purchase Agreement 15 ("the Fourth Option Shares")
IN WITNESS whereof the parties have entered into this Agreement the day and year
first before written
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EXECUTED and DELIVERED as a DEED by /s/ Xxxxxxxx Xxxx Xxxxxxxx
XXXXXXXX XXXX XXXXXXXX
in the presence of:
Witness's Signature: /s/ Xxxx Xxxxxxx
Witness's Name:
Witness's Address: 00 Xxxx Xxxxxx
Xxxxxxxxx
Xxxxxx XX00
Signed as a deed by
HLM DESIGNS, INC.
ATTEST
By: /s/ Xxxxxx Xxxxxx
President
/s/ Xxxxxxx Xxxxxxx Xxxx
Secretary
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