Exhibit 3.3
FOOD EXTRUSION, INC.
RESTRICTED STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made and entered into as of May 29, 1997,
between Food Extrusion, Inc., a Nevada corporation (the "Company") and Xxxxx X.
Xxxxx ("Purchaser"), the holder of a stock option granted to purchaser pursuant
to the Stock Option Agreement (as amended) between the Company and Purchaser
dated April 18, 1997 and amended on May 29, 1997 (the "Option Agreement").
R E C I T A L S:
A. Pursuant to the exercise of a stock option granted to
Purchaser by the Company in the Option Agreement, Purchaser has elected to
purchase 2,000,000 shares of the Company's Common Stock for a total purchase
price of $4,000,000.
B. As provided in the Option Agreement, Purchaser has agreed
to grant the Company the option to repurchase such shares in certain
circumstances.
NOW, THEREFORE, in consideration of the mutual covenants
exchanged, the parties agree as follows:
1. Exercise of Option.
(a) Exercise. Purchaser hereby agrees to purchase
2,000,000 shares of the Company's Common Stock (the "Shares") pursuant to an
exercise of the option granted in the Option Agreement, at an option price of
$2.00 per share (the "Option Price").
(b) Payment. Concurrently with the delivery of this
Agreement to the Company, Purchaser shall pay the consideration set forth in
Section 5 of the Option Agreement for the Shares purchased hereunder and shall
deliver any additional documents that may be required by the Option Agreement as
a condition to such exercise. In the event Purchaser delivers his Promissory
Notes in the form of Exhibit A attached hereto in payment of the purchase price,
the following shall apply:
(i) Purchaser shall assign, transfer and pledge
the Shares, or collateral of equivalent value acceptable to the Company, to the
Company as security for payment of the Promissory Note in accordance with the
provisions of a Security Agreement in the form of Exhibit B attached hereto.
(ii) In the event Purchaser's employment is
terminated for any reason whatsoever, including death, the Company shall have
the right upon thirty (30) days prior written notice to Purchaser, or his legal
representative or successor, to accelerate the full payment of the Promissory
Note, in which event such payment shall be due and payable to the Company after
thirty (30) days from the date of said notice, unless Purchaser is in default
under the Promissory Note or Security Agreement on the date such notice is sent,
in which case the provisions regarding acceleration of the Promissory Note
contained in Section 6 of the Security Agreement shall apply.
2. Repurchase Option.
(a) Shares Subject to Repurchase. Purchaser hereby
grants to the Company the option (the "Repurchase Option") to repurchase all or
part of the 2,000,000 Shares that have not become vested under the Option
Agreement at the Option Price, plus any accrued unpaid interest under the
Promissory Note if Purchaser delivers an unconditional Promissory Note for
payment of the purchase price, subject to adjustment pursuant to Section 3, upon
the occurrences set forth in subsection (c), but only to the extent such Shares
have not been released from the Repurchase Option as provided in subsection (b).
(b) Release Dates. One-third of the Shares (or
666,667) shall be released from the Repurchase Option upon execution of this
Agreement. Thereafter, an additional one-third of the Shares (or 666,667) shares
shall be released from the Repurchase Option on the last day of the first
anniversary of Purchaser's employment with the Company. Thereafter, the
remaining one-third of the Shares (or 666,666 shares) shall be released from the
Repurchase Option at the end of the next successive twelve (12) month period.
Notwithstanding the foregoing, the Shares shall immediately be released from the
Repurchase Option upon the occurrence of certain events as described in Section
2(b) of the Option Agreement. Shares subject to the Repurchase Option are
referred to herein as "Unvested Shares," and Shares which have been released
from the Repurchase Option are referred to herein as "Vested Shares."
(c) Occurrences Permitting Exercise. The Company may
exercise the Repurchase Option if during the term of this Agreement any one of
the following events (an "Offering Event") takes place: (i) Purchaser shall
cease to be employed by the Company (including a parent or subsidiary of the
Company) on a full-time basis for any reason, or no reason, with or without
cause, including involuntary termination, death or disability; or (ii) any event
occurs which causes the involuntary transfer to creditors or to any other person
or entity of all or any part of the Shares still subject to the Repurchase
Option at the time of such transfer.
(d) Exercise of Repurchase Option. Upon the
occurrence of an Offering Event, the Company may exercise the Repurchase Option
by delivering personally, or by registered or certified mail, to Purchaser (or
his permitted transferee or legal representative, as the case may be), within
ninety (90) days after the date of the Offering Event, a notice in writing
indicating the Company's election to exercise its Repurchase Option and the
number of Shares to be purchased by the Company or the Company's designee, who
shall be identified in such notice, and setting forth a date for closing not
later than thirty (30) days from the date of giving such notice.
(e) Closing for Repurchase of Shares. The closing
for the repurchase of the Shares pursuant to the exercise of the Repurchase
Option shall take place at the Company's principal offices. At the closing, the
holder of the certificate(s) representing the Shares being transferred shall
deliver said certificate or certificates evidencing the Shares to the Company,
duly endorsed for transfer, and the Company (or its designee) shall tender
payment of the purchase price for the Shares being purchased. The purchase price
shall be payable in full in cash, or by check, provided that the Company may
elect to offset against and deduct from any payment of the purchase price any
indebtedness then owed by Purchaser to the Company.
3. Adjustments. If, from time to time during the term of
this Agreement: (i) there is any stock dividend, distribution or dividend of
cash or property, stock split, or other change in the character or amount of any
of the outstanding securities of the Company; or (ii) there is any
consolidation, merger or sale of all, or substantially all, of the assets of the
Company; or (iii) the Shares are converted into any other class of securities by
capital reorganization or recapitalization; then in such event, any and all new,
substituted or additional securities, cash, or other property to which Purchaser
is entitled by reason of his ownership of the Shares, as to that portion
allocable to Purchaser's ownership of Unvested Shares, shall be immediately
subject to the Repurchase Option and be included in the word "Shares" for all
purposes with the same force and effect as the Shares presently subject to the
Repurchase Option and the other terms of this Agreement. While the total Option
Price shall remain the same after any such event, the Option Price per share
shall be appropriately adjusted.
4. Assignment of Rights. The Company may assign its
rights under Sections 2 and 3 hereof, to one or more persons or entities, who
shall have the right to so exercise such rights in his or its own name and for
his or its own account. If any such transfer of the Shares requires the consent
of any agency pursuant to the securities laws of any state, the time periods
specified herein shall be extended for such period as the necessary request for
consent to transfer is pending before such agency. All parties agree to
cooperate in making such request for transfer, and no transfer shall be executed
without such consent if required by law.
5. Termination of Restrictions.
(a) Release of Shares from Repurchase Option. The
number of Shares subject to the Repurchase Option will decline as set forth in
Section 2(b), and the Repurchase Option shall terminate following the expiration
of the notice period specified in Section 2(d). The Company shall, within ten
(10) days following Purchaser's written request to the Secretary of the Company,
which may be made once in a twelve-month calendar period, release and deliver to
Purchaser a certificate representing that number of shares which is no longer
subject to the Repurchase Option, or such lesser number of shares as purchaser
may have specified in such request. The Company shall cause new certificates to
be issued as necessary to effectuate the release and delivery of such shares to
Purchaser.
6. Legends.
(a) Endorsement on Certificates. The certificates
representing the Shares subject to this Agreement shall be endorsed with a
legend substantially in the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED
ONLY IN ACCORDANCE WITH THE TERMS OF A RESTRICTED STOCK
PURCHASE AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED
HOLDER OR HIS PREDECESSOR IN INTEREST, A COPY OF WHICH MAY BE
OBTAINED UNDER WRITTEN REQUEST TO THE SECRETARY OF THE
COMPANY. THE AGREEMENT MAY BE INSPECTED AT THE PRINCIPAL
OFFICE OF THE COMPANY DURING NORMAL BUSINESS HOURS."
(b) Termination of All Restrictions. In the event
the restrictions imposed by this Agreement shall be terminated as herein
provided, a new certificate or certificates representing the Shares shall be
issued, on request, without the legend referred to in Section 6(a).
(c) Securities Law Legends. Any transfer or sale of
the Shares is further subject to all restrictions on transfer imposed by state
or Federal securities laws. Accordingly, it is understood and agreed that the
certificates representing the Shares shall bear any legends required by such
state or Federal securities laws.
7. Dissolution of Marriage.
(a) Purchase of Shares from Former Spouse. In the
event of the dissolution of Purchaser's marriage, Purchaser shall have the right
and option to purchase from his or her spouse all of the Shares (i) awarded to
the spouse pursuant to a decree of dissolution of marriage or any other order by
any court of competent jurisdiction and/or any property settlement agreement
(whether or not incorporated by reference in any such decree), or (ii) gifted to
the spouse by Purchaser prior to the dissolution, at the fair market value of
said Shares as determined by the Company's Board of Directors, upon the terms
set forth below. If either Purchaser or Purchaser's spouse disputes the fair
market valuation of the Shares determined by the Board of Directors, such fair
market value shall be determined by arbitration in accordance with the rules of
the American Arbitration Association. Purchaser shall exercise his or her right,
if at all, within thirty (30) days following the entry of any such decree or
property settlement agreement by delivery to Purchaser's former spouse of
written notice of exercise, specifying the number of Shares Purchaser elects to
Purchase. The purchase price for the Shares shall be paid by delivery of a
promissory note for the purchase price bearing interest at the rate of ten
percent (10%) per annum payable in four (4) equal annual installments of
principal and interest, commencing on the anniversary date of the exercise of
the option, provided, however, that if, subsequent to the date any or all of the
Shares is awarded to Purchaser's former spouse as provided above, the Company
exercises its Repurchase Option with respect to any or all of the Shares so
awarded, the amount remaining due under such promissory note shall be reduced by
the difference between the fair market value of such Shares determined as set
forth above and the amount received by Purchaser for such Shares upon exercise
by the Company of the Repurchase Option.
(b) Transfer of Rights to Company. In the event
Purchaser does not exercise his or her right to purchase all of the Shares
awarded to Purchaser's former spouse, Purchaser shall provide written notice to
the Company of the number of Shares available for purchase within thirty (30)
days of the entry of the decree or property settlement agreement. The Company
shall then have the right to purchase any of the Shares not acquired by the
Purchaser directly from Purchaser's former spouse in the manner provided in
Sections 3(b)-3(e) above at the same price and on the same terms that were
available to Purchaser.
8. Consent of Spouse. If Purchaser is married on the date of
this Agreement, Purchaser's spouse shall execute a Consent of Spouse in the form
of Exhibit C hereto, effective on the date hereof. Such consent shall not be
deemed to confer or convey to the spouse any rights in the Shares that do not
otherwise exist by operation of law or the agreement of the parties. If
Purchaser should marry or remarry subsequent to the date of this Agreement,
Purchaser shall within thirty (30) days thereafter obtain his or her new
spouse's acknowledgment of and consent to the existence and binding effect of
all restrictions contained in this Agreement by signing a Consent of Spouse in
the form of Exhibit C.
9. Compliance With Income Tax Laws.
(a) Withholding Tax. Purchaser authorizes the
Company to withhold in accordance with applicable law from any compensation
payable to him or her any taxes required to be withheld by Federal, state or
local laws as a result of the purchase of the Shares. Furthermore, in the event
of any determination that the Company has failed to withhold a sum sufficient to
pay all withholding taxes due in connection with the purchase of the Shares,
Purchaser agrees to pay the Company the amount of such deficiency in cash within
five (5) days after receiving a written demand from the Company to do so,
whether or not Purchaser is an employee of the Company at that time. Purchaser
agrees to notify the Company of any sale or other disposition (within the
meaning of Section 421(b) of the Internal Revenue Code of 1986, as amended (the
"Code") by Purchaser of any of the Shares within one (1) year of the date hereof
or within two (2) years from the date of grant of any incentive stock option by
the Company pursuant to the exercise of which such Shares were acquired
hereunder.
(b) Interest on Notes. In the event that any
Promissory Note issued by the Purchaser under this Agreement is subject to the
provisions of Section 1274 of the Code, and would have original issue discount
subject to Section 1272 of the Code, the Company and the Purchaser agree to make
and file a timely election under Section 1274(c) of the Code and regulations
thereunder to account for all of the interest on such Note on the cash receipts
and disbursements method for Federal income tax purposes.
10. Purchaser's Representations. In connection with the
purchase of the Shares, Purchaser hereby represents and warrants to the Company
as follows:
(a) Investment Intent; Capacity to Protect
Interests. Purchaser is purchasing the Shares solely for his or her own account
for investment and not with a view to or for sale in connection with any
distribution of the Shares or any portion thereof and not with any present
intention of selling, offering to sell or otherwise disposing of or distributing
the Shares or any portion thereof in any transaction other than a transaction
exempt from registration under the Securities Act of 1933, as amended (the
"Act"). Purchaser also represents that the entire legal and beneficial interest
of the Shares is being purchased, and will be held, for Purchaser's account
only, and neither in whole or in part for any other person. Purchaser either (i)
has a pre-existing business or personal relationship with the Company or any of
its officers, directors or controlling persons, or (ii) by reason of Purchaser's
business or financial experience or the business or financial experience of
Purchaser's professional advisors who are unaffiliated with and who are not
compensated by the Company or any affiliate or selling agent of the Company,
directly or indirectly, could be reasonably assumed to have the capacity to
evaluate the merits and risks of an investment in the Company and to protect
Purchaser's own interests in connection with this transaction.
(b) Information Concerning Company. Purchaser has
heretofore discussed the Company and its plans, operations and financial
condition with the Company's officers and has heretofore received all such
information as Purchaser has deemed necessary and appropriate to enable the
Purchaser to evaluate the financial risk inherent in making an investment in the
Shares, and Purchaser has received satisfactory and complete information
concerning the business and financial condition of the Company in response to
all inquiries in respect thereof.
(c) Economic Risk. Purchaser realizes that the
purchase of the Shares will be a highly speculative investment and involves a
high degree of risk, and Purchaser is able, without impairing his or her
financial condition, to hold the Shares for an indefinite period of time and to
suffer a complete loss on Purchaser's investment.
(d) Restricted Securities. Purchaser understands and
acknowledges that:
(i) the sale of the Shares has not been
registered under the Act, and the Shares must be held indefinitely unless
subsequently registered under the Act or an exemption from such registration is
available;
(ii) the share certificate representing the
Shares will be stamped with the legends specified in Section 6 hereof; and
(iii) the Company will make a notation in its
records of the aforementioned restrictions on transfer and legends.
(e) Disposition under Rule 144. Purchaser
understands that the Shares are restricted securities within the meaning of Rule
144 promulgated under the Act; that unless the Shares have been issued pursuant
to Rule 701 promulgated under the Act the exemption from registration under Rule
144 will not be available in any event for at least one year from the date of
purchase and payment of the Shares (AND THAT PAYMENT BY A NOTE IS NOT DEEMED
PAYMENT UNLESS IT IS SECURED BY ASSETS OTHER THAN THE SHARES), and even then
will not be available unless: (i) a public trading market then exists for the
Common Stock of the Company; (ii) adequate information concerning the Company is
then available to the public; and (iii) other terms and conditions of Rule 144
are complied with; and that any sale of the Shares may be made only in limited
amounts in accordance with such terms and conditions.
(f) Further Limitations on Disposition. Without in
any way limiting his representations set forth above, Purchaser further agrees
that he shall in no event make any disposition of all or any portion of the
Shares unless and until:
(i) (A) There is then in effect a Registration
Statement under the Act covering such proposed disposition and such disposition
is made in accordance with said Registration Statement; or, (B)(1) Purchaser
shall have notified the Company of the proposed disposition and shall have
furnished the Company with a detailed statement of the circumstances surrounding
the proposed disposition, (2) Purchaser shall have furnished the Company with an
opinion of the Purchaser's counsel to the effect that such disposition will not
require registration of such shares under the Act, and (3) such opinion of
Purchaser's counsel shall have been concurred in by counsel for the Company and
the Company shall have advised Purchaser of such concurrence, (4) counsel for
the Company shall deliver to Purchaser's counsel written notification of such
concurrence within five (5) days after Company counsel's receipt of the opinion
from Purchaser's counsel; and,
(ii) The Shares proposed to be transferred are no
longer subject to the Repurchase Option set forth in Section 2 hereof.
11. Escrow. As security for his faithful performance of
the terms of this Agreement and to ensure the availability for delivery of
Purchaser's Shares upon exercise of the Repurchase Option herein provided for,
Purchaser agrees to deliver to and deposit with Bank of San Francisco, (the
"Escrow Agent"), as Escrow Agent in this transaction, two Stock Assignments duly
endorsed (with date and number of Shares blank) in the form attached hereto as
Exhibit D, together with the certificate or certificates evidencing the Shares;
said documents are to be held by the Escrow Agent pursuant to the Joint Escrow
Instructions of the Company and Purchaser set forth in Exhibit E attached hereto
and incorporated by this reference, which instructions shall also be delivered
to the Escrow Agent at the closing hereunder.
12. "Market Stand-Off" Agreement. Purchaser hereby agrees
that he or she shall not, to the extent reasonably requested by the Company and
an underwriter of Common Stock (or other securities) of the Company, sell or
otherwise transfer or dispose (other than to donees who agree to be similarly
bound) of any Shares during the one hundred eighty (180)-day period following
the effective date of a registration statement of the Company filed under the
Securities Act; provided, however, that: (a) all officers and directors of the
Company and all other persons with registration rights enter into similar
agreements; and (b) such agreement shall be applicable only to the first such
registration statement of the Company which covers shares (or securities) to be
sold on its behalf to the public in an underwritten offering. Such agreement
shall be in writing in a form satisfactory to the Company and such underwriter.
In order to enforce the foregoing covenant, the Company may impose stop-transfer
instructions with respect to the Shares of each Shareholder (and the shares or
securities of every other person subject to the foregoing restriction) until the
end of such one hundred eighty (180)-day period.
13. Enforcement. Purchaser agrees that a violation on his
or her part of any of the terms of this Agreement (other than those contained in
Section 9 above) that is not cured within ten (10) days of the Company's giving
notice of such violation to the Purchaser may cause irreparable damage to the
Company, the exact amount of which is impossible to ascertain, and for that
reason agrees that the Company shall be entitled to exercise its right to effect
a repurchase and transfer of the Shares pursuant to Section 2 hereof or to a
decree of specific performance of the terms hereof or an injunction restraining
further violation, said right to be in addition to any other remedies of said
parties.
14. Controlling Provisions. To the extent that there may
be any conflict between the provisions of this Agreement and the provisions
contained in the Company's By-Laws on the transfer or restriction on transfer of
Shares, the terms of this Agreement shall be controlling. This Agreement may not
be modified except by a writing signed by the party to be bound.
15. Ownership, Voting Rights, Duties. This Agreement
shall not affect in any way the ownership, voting rights or other rights or
duties of Purchaser, except as specifically provided herein.
16. Notices. All notices and other communications
required or permitted hereunder shall be in writing and shall be deemed
effectively given upon personal delivery or on the day sent by facsimile
transmission if a true and correct copy is sent the same day by first class
mail, postage prepaid, or by dispatch by an internationally recognized express
courier service, to the proper parties at the appropriate business addresses.
17. Binding Effect. This Agreement shall inure to the benefit of the Company and
its successors and assigns and, subject to the restrictions on transfer set
forth herein, be binding upon Purchaser, his permitted transferees, heirs,
legatees, executors, administrators and legal successors, who shall hold the
Shares subject to the terms hereof.
18. Entire Agreement. This Agreement supersedes all
previous written or oral agreements between the parties regarding the subject
matter hereof, and constitutes the entire agreement of the parties regarding
such subject matter. This Agreement may not be modified or terminated except by
a writing executed by all of the parties hereto.
19. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
20. Governing Law. This Agreement, together with the exhibits
hereto, shall be governed by and construed under the laws of the State of
California, as such laws are applied to contracts entered into by residents of
such state and performed in such state.
21. Attorneys' Fees. In the event of litigation brought by
either party to enforce the provisions of this Agreement or for damages based
upon the breach thereof, the prevailing party shall be entitled to recover his
costs and reasonable attorneys' fees, as determined by the court.
22. Severability. If any provision of this Agreement is
held by a court of competent jurisdiction to be invalid, void or unenforceable,
the remaining provisions shall nevertheless continue in full force and effect
without being impaired or invalidated in any way and shall be construed in
accordance with the purposes and tenor and effect of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
on the date first above written.
FOOD EXTRUSION, INC. XXXXX X. XXXXX
By: /s/Xxxxxx XxXxxx By: /s/Xxxxx Xxxxx
----------------- ---------------
Title: Chairman of the Board Address:
0000 Xxxxxxxxxx Xx.
Xxx Xxxxxxxxx, XX 00000
EXHIBIT C
CONSENT OF SPOUSE
I, Xxx Xxxxx , spouse of Xxxxx X. Xxxxx,
acknowledge that I have read the Restricted Stock Purchase Agreement dated as of
May 29, 1997 to which this Consent is attached as Exhibit C (the "Agreement")
and that I know its contents. I am aware that by its provisions (a) my spouse
and Food Extrusion, Inc. (the "Company") have the option to purchase all the
Shares of the Company of which I may become possessed as a result of a gift from
my spouse or a court decree and/or any property settlement in any domestic
litigation, (b) the Company has the option to purchase certain Shares of the
Company which my spouse owns pursuant to the Agreement including any interest I
might have therein, upon termination of his employment under circumstances set
forth in the Agreement, and (c) certain other restrictions are imposed upon the
sale or other disposition of the Shares.
I hereby agree that my interest, if any, in the Shares subject
to the Agreement shall be irrevocably bound by the Agreement and further
understand and agree that any community property interest I may have in the
Shares shall be similarly bound by the Agreement.
I agree to the sale and purchase described in Section 7 of the
Agreement and I hereby consent to the sale of the Shares by my spouse or his
legal representative in accordance with the provisions of the Agreement.
Further, as part of the consideration for the Agreement, I agree that at my
death, if I have not disposed of any interest of mine in the Shares by an
outright bequest of said shares to my spouse, then my spouse and the Company
shall have the same rights against my legal representative to purchase any
interest of mine in the Shares as they would have had pursuant to Section 7 of
the Agreement if I had acquired the Shares pursuant to a court decree in
domestic litigation.
I am aware that the legal, financial and related matters
contained in the Agreement are complex and that I am free to seek independent
professional guidance or counsel with respect to this Consent. I have either
sought such guidance or counsel or determined after reviewing the Agreement
carefully that I will waive such right.
Dated as of the 28th of June , 1997.
/s/ Xxx Xxxxx
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EXHIBIT D
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, Xxxxx X. Xxxxx hereby sells, assigns and
transfers unto ( )
shares of the Common Stock Food Extrusion, Inc., a Nevada corporation, standing
in the undersigned's name on the books of said corporation represented by
Certificate No. , and do hereby irrevocably constitute and
appoint as the undersigned's agent and attorney-in-fact to
transfer the said stock on the books of the said corporation with full power of
substitution in the premises.
Dated: , 19 /s/ Xxxxx Xxxxx
------------ -- ---------------
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, Xxxxx X. Xxxxx hereby sells, assigns and
transfers unto ( )
shares of the Common Stock of Food Extrusion, Inc. a Nevada corporation,
standing in the undersigned's name on the books of said corporation represented
by Certificate No. , and do hereby irrevocably constitute and
appoint as the undersigned's agent and attorney-in-fact to
transfer the said stock on the books of the said corporation with full power of
substitution in the premises.
Dated: , 19 /s/ Xxxxx Xxxxx
------------ -- ---------------
EXHIBIT E
JOINT ESCROW INSTRUCTIONS
May 29, 0000
Xxxx xx Xxx Xxxxxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Gentlemen:
As Escrow Agent for both Food Extrusion, Inc., a Nevada
corporation (the "Company"), and the undersigned purchaser (the "Purchaser") of
common stock (the "Shares") of the Company, you are hereby authorized and
directed to hold the documents delivered to you pursuant to the terms of that
certain Restricted Stock Purchase Agreement (the "Agreement"), dated as of the
date hereof, to which a copy of these Joint Escrow Instructions is attached as
Exhibit E, in accordance with the following instructions:
1. In the event the Company and/or any assignee of the Company
(referred to collectively for convenience herein as the "Company") shall elect
to exercise the Repurchase Option set forth in the Agreement, the Company shall
give to Purchaser and you a written notice specifying the number of Shares to be
purchased, the purchase price, and the time for a closing hereunder at the
principal office of the Company. Purchaser and the Company hereby irrevocably
authorize and direct you to close the transaction contemplated by such notice in
accordance with the terms of said notice.
2. At the closing, you are directed (a) to date the stock
assignments necessary for the transfer in question, (b) to fill in the number of
Shares being transferred, and (c) to deliver same, together with the
certificates evidencing the Shares to be transferred, to the Company against the
simultaneous delivery to you of the purchase price (by check or evidence of
cancellation of indebtedness of Purchaser to the Company) for the number of
Shares being purchased pursuant to the exercise of the Repurchase Option.
3. Purchaser irrevocably authorizes the Company to deposit
with you any certificates evidencing the Shares to be held by you hereunder and
any additions and substitutions to said Shares as defined in the Agreement.
Purchaser does hereby irrevocably constitute and appoint you as his
attorney-in-fact and agent for the term of this escrow to execute with respect
to such securities all stock certificates, stock assignments, or other documents
necessary or appropriate to make such securities negotiable and complete any
transaction herein contemplated.
Subject to the provisions of this Section 3, Purchaser shall exercise all rights
and privileges of a shareholder of the Company while the Shares are held by you.
4. This escrow shall terminate at such time as there are no
longer any Shares subject to the Repurchase Option.
5. If at the time of termination of this escrow you should
have in your possession any documents, securities, or other property belonging
to Purchaser, you shall deliver all of same to Purchaser and shall be discharged
of all further obligations hereunder.
6. Your duties hereunder may be altered, amended, modified or
revoked only by a writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such
duties as are specifically set forth herein and may rely and shall be protected
in relying or refraining from acting on any instrument reasonably believed by
you to be genuine and to have been signed or presented by the proper party or
parties. You shall not be personally liable for any act you may do or omit to do
hereunder as Escrow Agent or as attorney-in-fact for Purchaser while acting in
good faith and in the exercise of your own good judgment, and any act done or
omitted by you pursuant to the advice of your own attorneys shall be conclusive
evidence of such good faith.
8. You are hereby expressly authorized to disregard any and
all warnings given by any of the parties hereto or by any other person or
company, excepting only orders or process of courts of law, and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree of any
court, you shall not be liable to any of the parties hereto or to any other
person, firm or company by reason of such compliance, notwithstanding any such
order, judgment or decree being subsequently reversed, modified, annulled, set
aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of any
failure to confirm the identity, authorities or rights of the parties executing
or delivering or purporting to execute or deliver the Agreement or any documents
or papers deposited or called for hereunder.
10. You shall not be liable for the outlawing of any rights
under the Statute of Limitations with respect to these Joint Escrow Instructions
or any documents deposited with you.
11. You shall be entitled to employ such legal counsel and
other experts as you may deem necessary or proper to advise you in connection
with your obligations hereunder, may rely upon the advice of such counsel, and
may pay such counsel reasonable compensation therefor.
12. Your responsibilities as Escrow Agent hereunder shall
terminate if you shall resign by written notice to each party. In the event of
any such termination, the Company and the Purchaser shall appoint a successor
Escrow Agent.
13. If you reasonably require other or further instructions in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
14. It is understood and agreed that should any dispute arise
with respect to the delivery and/or ownership or rights of possession of the
securities held by you hereunder, you are authorized and directed to retain in
your possession without liability to anyone all or any part of said securities
until such dispute shall have been settled either by mutual written agreement of
the parties concerned or by a final order, decree, or judgment of a court of
competent jurisdiction after the time for appeal has expired and no appeal has
been perfected, but you shall be under no duty whatsoever to institute or defend
any such proceedings.
15. Any notice required or permitted hereunder shall be given
in writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail with
postage and fees prepaid, addressed to each of the other parties entitled to
such notice at the following addresses, or at such other addresses as a party
may designate by ten (10) days' advance written notice to each of the other
parties hereto.
COMPANY: Food Extrusion, Inc.
0000 Xxxx'x Xxxxxx Xxxxx
Xx Xxxxxx Xxxxx, Xxxxxxxxxx 00000
PURCHASER: Xxxxx X. Xxxxx
Address: 0000 Xxxxxxxxxx Xx.
Xxx Xxxxxxxxx, XX 00000
ESCROW AGENT: Bank of San Francisco
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
16. By signing these Joint Escrow Instructions, you become a
party hereto only for the purpose of said Joint Escrow Instructions; you do not
become a party to the Agreement.
17. This instrument shall be binding upon and inure to the
benefit of the parties hereto, and their respective successors and permitted
assigns.
Very truly yours,
Food Extrusion, Inc.,
a Nevada corporation
By: /s/ Xxxxxx XxXxxx
------------------
Title: Chairman
PURCHASER:
/s/ Xxxxx Xxxxx
----------------
Xxxxx X. Xxxxx
Agreed to and accepted as
of the date set forth
above.
ESCROW AGENT:
Bank of San Francisco
----------------------
By: /s/ Chloe A. Flowers
------------------------
Chloe A. Flowers, Vice
President and Manager
