EXHIBIT 7.1
GENROCO, INC.
FORM OF STOCK PURCHASE AGREEMENT
THIS AGREEMENT, dated the ---- day of ---------, ----, is made by GENROCO,
INC., a Wisconsin corporation (the "Company") and Xxxxx Xxxx (the "Employee").
WHEREAS, the Company believes it to be in the best interests of the Company
for Employee to obtain stock ownership in the Company in order that he will have
a greater incentive to work for and manage the Company's affairs in such a way
that its shares may become more valuable; and
WHEREAS, Employee desires to purchase shares in the Company.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein, the sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. Purchase of Shares. The Company shall sell to Employee, and Employee
------------------
shall purchase from the Company ------- shares of the common stock of the
Company.
2. Purchase Price. The purchase price of the shares shall be $----- per
--------------
share, for an aggregate purchase price of $-------. The purchase price per
share is equal to approximately -----% of the average of the bid and asked price
for the shares for 30 days prior to the date of this Agreement.
3. Company Loan. The purchase price shall be funded by a loan from the
------------
Company to the Employee in substantially the same form as attached hereto.
Employee's obligation under the loan shall be secured by the shares purchased
under this Agreement. The stock shall be held in custody by the Company or an
agent for the Company until the loan has been repaid. The Employee shall
deliver a signed, blank stock power to the Company relating thereto.
4. Securities Law Representations. Employee represents that: (i) he is
------------------------------
acquiring the stock for his own account for investment and not with a view to,
or for sale in connection with, the resale or distribution of any such stock;
(ii) he understands that by "investment" it is meant that he is acquiring such
stock because of his desire to acquire a proprietary interest in the Company and
because of prospects of future long term appreciation in the value of such
stock; (iii) he understands that such stock is not being registered under the
Securities Act of 1933, as amended, on the grounds that the issuance of such
stock pursuant to the exercise hereof is exempt under such Act, as not involving
any public offering; (iv) he understands that the Company's reliance on such
exemption is in part based on his representations; (v) he understands the
statutory basis for such exemption might not be present if, notwithstanding such
representations, the Employee has in mind acquiring such stock for resale on the
occurrence or nonoccurrence of some predetermined event; and (vi) he may not
transfer the stock unless and until he has furnished the Company with an opinion
of counsel reasonably satisfactory to the Company to the effect
Page 8 of 16 Pages
that the proposed transfer may be made without violation of the securities Act
of 1933, as amended, and applicable state securities laws.
5. Put and Call as to Shares.
-------------------------
(a) Company Call Option. The Company shall have three separate and
-------------------
independent call options with respect to the shares purchased under this
Agreement, at the price of $----- per share. Each call option shall apply to
separate ------- share blocks [equal to 1/3 the total number of shares purchased
pursuant to the agreement] of Company stock. The Company's call options shall
be as follows:
(i) The Company shall have a call option on the first -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately one year
after the date of the agreement]. To exercise the call option,
the Company must give written notice to Employee on or before ---
--------------- [one month from the date previously listed in
this subsection].
(ii) The Company shall have a call option on the second -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately two years
from the date of the agreement]. To exercise the call option,
the Company must give written notice to Employee on or before ---
--------------- [one month from the date previously listed in
this subsection].
(iii) The Company shall have a call option on the third -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately three years
from the date of the agreement]. To exercise the call option,
the Company must give notice to Employee on or before -----------
------- [one month from the date previously listed in this
subsection].
The purchase and sale of such shares will occur at the Company's principal
office at the time and date specified in the notice. In no event, however, will
the date for consummating the transaction be later than 30 days from the date of
the notice. At the closing, Employee will deliver to the Company certificates
representing the shares and the Company will deliver to Employee a check in the
amount of the option price; provided, however, that the Company may elect to
apply the proceeds against the Employee's obligation to the Company described in
Section 3 above. Notwithstanding the foregoing, the call option shall
terminate in the event that the Employee is terminated by the Company for
reasons other than cause, or the Employee terminates employment for good reason.
For this purpose, "cause" shall mean willful, illegal or gross misconduct,
fraud, conviction of a felony, consistent gross neglect of duties, or wanton
negligence by the Employee in the performance of his or her duties which is
materially and demonstrably damaging the Company, and "good reason" shall mean
the occurrence of any one or more of the following, without the Employee's
express written consent: (a) a reduction or material alteration in the nature
or status of Employee's authorities, duties, or responsibilities;
Page 9 of 16 Pages
(b) the Company requiring Employee to be based at a location which is more than
twenty-five miles from the Company's current headquarters, or (c) a reduction in
the Employee's annualized compensation.
(b) Employee Put Option. The Employee shall have three separate and
-------------------
independent put options with respect to the shares purchased under this
Agreement, at the price of $----- per share. Each put option shall apply to
separate ----- share blocks [equal to 1/3 of the total number of shares
purchased pursuant to the agreement] of Company stock. The Employee's put
options shall be as follows:
(i) The Employee shall have a put option on the first -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately one year
from the date of the agreement]. To exercise the put option,
Employee must give written notice to the Company on or before ---
--------------- [one month from date previously listed in this
subsection].
(ii) The Employee shall have a put option on the second -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately two years
from the date of the agreement]. To exercise the put option,
Employee must give written notice to the Company on or before ---
--------------- [one month from date previously listed in this
subsection].
(iii) The Employee shall have a put option on the third -----
share block if Employee does not remain continuously employed by
the Company through ------------------ [approximately three years
from the date of the agreement]. To exercise the put option,
Employee must give notice to the Company on or before -----------
------- [one month from date previously listed in this
subsection].
The purchase and sale of such shares will occur at the Company's principal
office at the time and date specified in the notice. In no event, however, will
the date for consummating the transaction be later than 30 days from the date of
the notice. At the closing, Employee will deliver to the Company certificates
representing the shares and the Company will deliver to Employee a check in the
amount of the option price; provided, however, that the Company may elect to
apply the proceeds against the Employee's obligation to the Company described in
Section 3 above.
6. Restrictive Legend on Shares. The stock certificates shall bear an
----------------------------
appropriate legend as determined by the Company referring to the applicable
terms, conditions and restrictions under this Agreement.
7. No Obligation of Employment. This option shall not impose any
---------------------------
obligation on the Company to continue the employment of the Employee.
8. Notices. Any notice to be given to the Company under the terms of
-------
this Agreement shall be addressed to the Company in care of its Chief Executive
Officer at the principal office of the Company in the State of Wisconsin, and
any notice to be given to the Employee may be addressed to him at his
Page 10 of 16 Pages
address as it appears on the payroll records of the Company or any subsidiary
thereof, or at such other address as either party may hereafter designate in
writing to the other. Any such notice shall be deemed to have been duly given
if and when enclosed in a properly sealed envelope or wrapper addressed as
aforesaid, marked for certified mailing, postage and certified mail fee prepaid
and deposited in a post office or branch post office regularly maintained by the
United States Government.
9. Adjustments. If the Company shall effect a subdivision or
-----------
consolidation of the common stock of the Company (the "Shares") or other capital
readjustment, shall pay a stock dividend, or shall effect any other increase or
reduction in the number of Shares outstanding without receiving consideration
therefor in money, service or property, the number of Shares then remaining
subject to this option and the amount payable for such shares shall be
appropriately adjusted by the Company's Board of Directors.
10. Wisconsin Agreement. This Agreement shall be construed under the laws
-------------------
of Wisconsin.
IN WITNESS WHEREOF, the Company and the Employee have signed this Agreement
and agree to all of its terms, conditions and restrictions, all as of the date
first above written.
Page 11 of 16 Pages
