Exhibit 99.2
SERIES D PREFERRED STOCK PURCHASE AGREEMENT
THIS SERIES D PREFERRED STOCK PURCHASE AGREEMENT (this "Agreement") is
entered into on this 18th of December 2001, by and between the Purchasers set
forth on the signature page hereto (the "Purchasers") and RGC International
Investors, LDC ("RGC"). The Purchasers and RGC are referred to collectively
herein as the "Parties".
W I T N E S S E T H:
WHEREAS, RGC owns a total of 4,910.844 shares of Series D Preferred
Stock, par value $0.10 per share (the "Series D Preferred Stock"), of
iEntertainment Network, Inc., a North Carolina corporation (the "Company"); and
WHEREAS, this Agreement contemplates a transaction in which the
Purchasers will purchase from RGC, and RGC will sell to the Purchasers,
3,910.844 shares of Series D Preferred Stock of the Company owned by RGC (the
"Preferred Shares") on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties
and covenants herein contained, the Parties, intending to be legally bound,
hereby agree as follows:
ARTICLE I
BASIC TRANSACTION
-----------------
SECTION 1.01. General. On and subject to the terms and conditions of
this Agreement, the Purchasers agree to acquire from RGC, and RGC agrees to
transfer to the Purchasers, the Preferred Shares for the consideration specified
below in Section 1.02.
SECTION 1.02. Consideration. The Purchasers agree to pay to RGC, by
wire transfer to an account designated by RGC, Two Hundred Thousand Dollars
($200,000) as payment for the Preferred Shares (the "Purchase Price").
SECTION 1.03. Closing. The sale and transfer of the Preferred Shares
(the "Closing") will take place at the offices of Xxxxxx Xxxxxxx Xxxxx & Xxxxxx
LLP in Raleigh, North Carolina, simultaneous with the date of the closing (the
"Closing Date") of the transactions contemplated by that certain Securities
Purchase and Exchange Agreement dated as of the date hereof between the Company
and the Purchasers (the "Securities Purchase and Exchange Agreement") and that
certain Series D Preferred Stock Exchange Agreement dated as of the date hereof
between RGC and the Company (the "Exchange Agreement").
SECTION 1.04. Deliveries at the Closing. At the Closing, RGC will
transfer and deliver to the Purchasers (or to the Company on the Purchasers'
behalf) one or more stock certificates representing the Preferred Shares,
endorsed in blank or accompanied by duly executed assignment
documents, and the Purchasers will deliver to RGC the Purchase Price specified
in Section 1.02 to be delivered at Closing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
CONCERNING THE TRANSACTION
--------------------------
SECTION 2.01. Representations and Warranties Regarding RGC. RGC
represents and warrants to the Purchasers that the statements contained in this
Section 2.01 are correct and complete as of the date of this Agreement and shall
be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 2.01).
(a) Authorization of Transaction. RGC has full power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder. This Agreement constitutes the valid and legally binding obligation
of RGC, enforceable in accordance with its terms and conditions, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to creditors' rights generally and the application of equitable
principles in any action, legal or equitable. To the best of its knowledge, RGC
need not give any notice to, make any filing with, or obtain any authorization,
consent or approval of any court or governmental agency or any regulatory or
self-regulatory agency, or any third party (other than the Company) (a
"Governmental Authority") in order to consummate the transactions contemplated
by this Agreement.
(b) Noncontravention. To the best of RGC's knowledge, neither
the execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, shall violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any Governmental Authority to which RGC is subject.
(c) Brokers' Fees. RGC has no liability or obligation to pay
any fees or commissions to any broker, finder or agent with respect to the
transactions contemplated by this Agreement for which the Purchasers or the
Company could become liable or obligated.
(d) Preferred Shares. As of the date hereof and as of the
Closing Date, RGC owns beneficially all of the Preferred Shares free and clear
of any restrictions on transfer (other than any restrictions under the
Securities Act of 1933, as amended, and state securities laws) and can convey
good and marketable title to the Preferred Shares free of any liens, claims and
encumbrances of any type whatsoever.
SECTION 2.02. Representations and Warranties of the Purchasers. Each
Purchaser, severally and not jointly, represents and warrants to RGC that the
statements made by such Purchaser in this Section 2.02 are correct and complete
as of the date of this Agreement and shall be correct and complete as of the
Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement throughout this Section 2.02).
(a) Authorization of Transaction. The Purchaser has the full
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding
obligation of the Purchaser, enforceable in accordance with its terms and
conditions, subject to applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to creditors' rights generally and the
application of equitable principles in any action, legal or equitable. To the
best of its knowledge, the Purchaser need not give any notice to, make any
filing with, or obtain any authorization, consent or approval of any
Governmental Authority (other than the Company) in order to consummate the
transactions contemplated by this Agreement.
(b) Noncontravention. To the best of its knowledge, neither
the execution and the delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will violate any constitution, statute,
regulation, rule, injunction, judgment, order, decree, ruling, charge or other
restriction of any Governmental Authority to which the Purchaser is subject.
(c) Brokers' Fees. The Purchaser does not have any liability
or obligation to pay any fees or commissions to any broker, finder or agent with
respect to the transactions contemplated by this Agreement for which RGC could
become liable or obligated.
(d) Accredited Investor Status. The Purchaser is an
"Accredited Investor" as that term is defined in Rule 501(a) of Regulation D.
(e) Reliance on Exemptions. The Purchaser understands that the
Preferred Shares are being offered and sold to the Purchaser in reliance upon
specific exemptions from the registration requirements of United States federal
and state securities laws and that RGC is relying upon the truth and accuracy
of, and the Purchaser's compliance with, the representations, warranties,
agreements, acknowledgments and understandings of the Purchaser set forth herein
in order to determine the availability of such exemptions and the eligibility of
the Purchaser to acquire the Preferred Shares.
(f) Information. The Purchaser and its counsel have received
from the Company all materials relating to the business, finances and operations
of the Company and materials relating to the offer and sale of the Preferred
Shares that have been specifically requested by the Purchaser or its counsel.
The Purchaser and its counsel have been afforded the opportunity to ask
questions of the Company and have received what the Purchaser believes to be
satisfactory answers to any such inquiries. Neither such inquiries nor any other
due diligence investigation conducted by the Purchaser or its counsel or any of
its representatives shall modify, amend or affect the Purchaser's right to rely
on RGC's representations and warranties contained herein.
(g) Governmental Review. The Purchaser understands that no
United States federal or state agency or any other government or governmental
agency has passed upon or made any recommendation or endorsement of the
Preferred Shares.
(h) Transfer or Resale. The Purchaser understands that
the sale or resale of the Preferred Shares and the shares of Common Stock
issuable upon conversion thereof have not been and are not being registered
under the Securities Act or any applicable state securities laws, and the
Preferred Shares and the shares of Common Stock issuable upon conversion thereof
may not be transferred by the Purchaser unless such securities are sold pursuant
to (a) an effective registration statement under the Securities Act, (b) an
exemption from such registration, or (c) Rule 144.
(i) Residency. The Purchaser is a resident of the
jurisdiction set forth under the Purchaser's name on the Execution Page hereto
executed by the Purchaser.
(j) Investment Representation. This Agreement is made with
each Purchaser in reliance upon such Purchaser's representation to RGC, which
by such Purchaser's execution of this Agreement such Purchaser hereby confirms,
that except as contemplated by the Securities Purchase and Exchange Agreement,
the Preferred Shares to be received by such Purchaser will be acquired for
investment for such Purchaser's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and that such
Purchaser has no present intention of selling, granting any participation in,
or otherwise distributing the same except to the Company or affiliates of such
Purchaser. By executing this Agreement, such Purchaser further represents that
except as contemplated by the Securities Purchase and Exchange Agreement such
Purchaser does not have any contract, undertaking, agreement or arrangement
with any person to sell, transfer or grant participation to such person or to
any third person, with respect to any of the Preferred Shares.
(k) Investment Experience. Such Purchaser is an investor in
securities of companies and acknowledges that it is able to fend for itself,
can bear the economic risk of its investment, and has such knowledge and
experience in financial or business matters that it is capable of evaluating
the merits and risks of the investment in the Preferred Shares. If other than
an individual, such Purchaser also represents it has not been organized for the
purpose of acquiring the Securities.
ARTICLE III
COVENANTS
---------
Without limiting the specific obligations of any Party under any
agreement or covenant hereunder, each of the Parties shall use its reasonable
best efforts to take all action and to do all things necessary, proper or
advisable in order to consummate and make effective the transactions
contemplated by this Agreement as soon as practicable after the date hereof,
including satisfaction, but not waiver, of the closing conditions set forth in
Article IV and Article V below. In case at any time after the Closing any
further action is necessary to carry out the purposes of this Agreement, each of
the Parties shall take such further action, including the execution and delivery
of such further instruments and documents, as any other Party reasonably may
request, all at the sole cost and expense of the requesting Party.
ARTICLE IV
CONDITIONS TO
OBLIGATION OF THE PURCHASERS TO CLOSE
-------------------------------------
The obligation of the Purchasers to consummate the transactions to be
performed by the Purchasers in connection with the Closing is subject to
satisfaction of the following conditions:
SECTION 4.01. Representations and Warranties. All of the
representations and warranties made by RGC in this Agreement must have been true
and correct as of the date of this Agreement and must be true and correct at and
as of the Closing Date with the same force and effect as though such
representations and warranties had been made at and as of the Closing Date.
SECTION 4.02. Compliance with Agreement. RGC shall have performed and
complied in all material respects with its obligations and covenants under this
Agreement which are to be performed or complied with by RGC prior to or at the
Closing.
SECTION 4.03. Absence of Proceedings. No action, suit or proceeding
shall be pending or threatened before any court or quasi-judicial or
administrative agency of any federal, state, local or foreign jurisdiction or
before any arbitrator wherein an unfavorable injunction, judgment, order,
decree, ruling or charge would (a) prevent consummation of any of the
transactions contemplated by this Agreement, or (b) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation, and no such injunction, judgment, order, decree, ruling or charge
shall be in effect.
SECTION 4.04. Approvals. All applicable consents, authorizations,
approvals, permits and orders required to be obtained by RGC from any
Governmental Authority with respect to the transactions contemplated in this
Agreement shall have been obtained, shall have become effective and final, shall
be in full force and effect and shall contain no provision materially adverse to
any of the Parties.
SECTION 4.05. Proceedings and Instruments Satisfactory. All
proceedings, corporate or otherwise, required to be taken by RGC in connection
with the performance of this Agreement and the consummation of the transactions
contemplated by this Agreement, and all certificates, instruments, and other
documents required to effect the transactions contemplated hereby, shall be
complete and reasonably satisfactory in form and substance to the Purchasers and
their counsel.
SECTION 4.06 Closing of Other Transactions. The Purchasers, RGC and
the Company shall have simultaneously closed on the transactions contemplated by
the Exchange Agreement and the Securities Purchase and Exchange Agreement.
The Purchasers may waive any condition specified in this Article IV if
they execute a writing to such effect at or prior to the Closing.
ARTICLE V
CONDITIONS TO OBLIGATION OF
RGC TO CLOSE
------------
The obligation of RGC to consummate the transactions to be performed by
RGC in connection with the Closing is subject to satisfaction of the following
conditions:
SECTION 5.01. Representations and Warranties. The representations and
warranties made by the Purchasers in this Agreement must have been true and
correct as of the date of this Agreement and must be true and correct at and as
of the Closing Date with the same force and effect as though such
representations and warranties had been made at and as of the Closing Date.
SECTION 5.02. Compliance with Agreement. The Purchasers shall have
performed and complied in all material respects with its obligations and
covenants under this Agreement which are to be performed or complied with by the
Purchasers prior to or at the Closing.
SECTION 5.03. Absence of Proceedings. No action, suit or proceeding
shall be pending or threatened before any court or quasi-judicial or
administrative agency of any federal, state, local or foreign jurisdiction or
before any arbitrator wherein an unfavorable injunction, judgment, order,
decree, ruling or charge would (a) prevent consummation of any of the
transactions contemplated by this Agreement, or (b) cause any of the
transactions contemplated by this Agreement to be rescinded following
consummation, and no such injunction, judgment, order, decree, ruling or charge
shall be in effect.
SECTION 5.04. Approvals. All applicable consents, authorizations,
approvals, permits and orders required to be obtained by the Purchasers from any
Governmental Authority with respect to the transactions contemplated in this
Agreement shall have been obtained, shall have become effective, shall be in
full force and effect and shall contain no provision materially adverse to any
of the Parties.
SECTION 5.05. Proceedings and Instruments Satisfactory. All
proceedings, corporate or otherwise, required to be taken by the Purchasers in
connection with the performance of this Agreement and the consummation of the
transactions contemplated hereby, and all certificates, instruments, and other
documents required to effect the transactions contemplated hereby, shall be
complete in all material respects and reasonably satisfactory in form and
substance to RGC and RGC's counsel.
SECTION 5.06 Closing of Other Transactions. The Purchasers, RGC and the
Company shall have simultaneously closed on the transactions contemplated by the
Exchange Agreement and the Securities Purchase and Exchange Agreement.
RGC may waive any condition specified in this Article V if it executes
a writing to such effect at or prior to the Closing.
ARTICLE VI
TERMINATION
-----------
SECTION 6.01. Termination of Agreement. The Parties may terminate this
Agreement as provided below:
(i) The Purchasers and RGC may terminate this Agreement
by mutual written consent at any time prior to the Closing Date;
(ii) The Purchasers may terminate this Agreement by giving
written notice to RGC at any time prior to the Closing Date: (A) in
the event RGC has breached any material representation, warranty,
covenant or agreement contained in this Agreement in any material
respect, the Purchasers have notified RGC of such breach, and such
breach has continued without cure for a period of five (5) days after
the notice of breach; or (B) if the Closing shall not have occurred on
or before December 20, 2001, by reason of the failure of any condition
precedent under Article IV, unless the failure results primarily from
a Purchaser itself breaching any representation, warranty, covenant or
agreement contained in this Agreement; and
(iii) RGC may terminate this Agreement by giving written
notice to the Purchasers at any time prior to the Closing Date: (A) in
the event a Purchaser has breached any material representation,
warranty, covenant or agreement contained in this Agreement in any
material respect, RGC has notified the Purchasers of the breach, and
the breach has continued without cure for a period of five (5) days
after the notice of breach; or (B) if the Closing shall not have
occurred on or before December 20, 2001, by reason of the failure of
any condition precedent under Article V, unless the failure results
primarily from RGC itself breaching any representation, warranty,
covenant or agreement contained in this Agreement.
SECTION 6.02. Effect of Termination. If any Party terminates this
Agreement pursuant to and in accordance with Section 6.01, all rights and
obligations of the Parties hereunder shall terminate without any liability of
any Party to any other Party, except for any liability of any Party then in
breach.
ARTICLE VII
MISCELLANEOUS
-------------
SECTION 7.01. No Third-Party Beneficiaries. This Agreement shall not
confer any rights or remedies upon any person other than the Parties and their
respective successors and permitted assigns.
SECTION 7.02. Entire Agreement. This Agreement, including the
agreements and documents referred to herein, constitutes the entire agreement
among the Parties and supersedes any prior understandings, agreements or
representations by or among the Parties, written or oral, to the extent they
related in any way to the subject matter hereof.
SECTION 7.03. Succession and Assignment. This Agreement shall be
binding upon and inure to the benefit of the Parties named herein and their
respective successors and permitted
assigns. No Party may assign either this Agreement or any of its rights,
interests or obligations hereunder without the prior written approval of the
Purchasers and RGC.
SECTION 7.04. Counterparts; Delivery by Facsimile. This Agreement may
be executed in any number of counterparts with the same effect as if all Parties
had signed the same document. All counterparts shall be construed together and
shall constitute one Agreement. This Agreement and any signed agreement or
instrument entered into in connection with this Agreement or contemplated
hereby, and any amendments hereto or thereto, to the extent signed and delivered
by means of a facsimile machine, shall be treated in all manner and respects as
an original agreement or instrument and shall be considered to have the same
binding legal effect as if it were the original signed version thereof delivered
in person.
SECTION 7.05. Headings. Article and section headings contained in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
SECTION 7.06. Notices. Any notices required or permitted to be given
under the terms of this Agreement shall be sent by certified or registered mail
(return receipt requested) or delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile, and shall be effective
five days after being placed in the mail, if mailed, or upon receipt or refusal
of receipt, if delivered personally or by courier or by facsimile, in each case
addressed to a party. The addresses for such communications shall be:
If to RGC:
x/x Xxxx Xxxx Xxxxxxx Xxxxxxxxxx, X.X.
Xxxxx 000
000 Xx. Xxxxxx Xxxx
Xxxx Xxxxxx, XX 00000
Facsimile: 000-000-0000
Phone: 000-000-0000
With a copy to:
Klehr, Harrison, Xxxxxx, Branzburg & Xxxxxx LLP
000 X. Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
Phone: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
If to a Purchaser, to the address set forth under the Purchaser's name
on the signature page hereto executed by the Purchaser. Each party shall provide
notice to the other party of any change in address or facsimile number.
SECTION 7.07. Amendments and Waivers. No amendment or waiver of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Purchasers and RGC. No waiver by any Party of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.
SECTION 7.08. Severability. Any term or provision of this Agreement
that is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.
SECTION 7.09. Expenses. Each of the Parties shall bear its own costs
and expenses, including legal fees and expenses, incurred in connection with
this Agreement and the transactions contemplated hereby.
SECTION 7.10. Specific Performance. Each of the Parties acknowledges
and agrees that the other Parties would be damaged irreparably in the event any
of the provisions of this Agreement are not performed in accordance with their
specific terms or otherwise are breached. Accordingly, each of the Parties
agrees that the other Parties shall be entitled to an injunction or injunctions
to prevent breaches of the provisions of this Agreement and to enforce
specifically this Agreement and the terms and provisions hereof in any action
instituted in any court of the United States or any state thereof having
jurisdiction over the Parties and the matter, in addition to any other remedy
provided or permitted under this Agreement.
SECTION 7.11 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of North Carolina applicable
to contracts made and to be performed in the State of North Carolina (without
regard to principles of conflict of laws).
SECTION 7.12 Survival of Representations and Warranties. All of the
representations and warranties of the Purchasers or RGC contained in this
Agreement and any certificate or document delivered pursuant to this Agreement
shall survive the Closing (even if the other knew or had reason to know of any
misrepresentation or breach of warranty at the time of Closing) and continue in
full force and effect for a period of two years thereafter.
[THE NEXT PAGE IS THE SIGNATURE PAGE]
IN WITNESS WHEREOF, the Parties have executed this Series D Preferred
Stock Purchase Agreement as of the day and year first above written.
PURCHASERS:
________________________________________ ________________________________
X. X. Xxxxxxx Xxxx Cay
Residence: Florida Residence: South Carolina
ADDRESS: 0000 Xxxxx Xxxxxxx Xxxxxx ADDRESS: Delta Plantation
Xxxxxxxx, XX 00000 Xxxxx 0, Xxx 000
Facsimile: (000) 000-0000 Xxxxxxxxxxx, XX 00000
Telephone: (000) 000-0000 Facsimile: _____________________
Telephone: _____________________
________________________________________
Xxx Xxxxx
Residence: Florida
Address: 000 Xxxx Xxxx Xxxxx
Xxxxxxxx Xxx, XX 00000
SELLER:
RGC International Investors, LDC.
By: Xxxx Xxxx Capital Management, L. P.
Investment Manager
By: RGC General Partner Corp.,
as General Partner
By: _____________________________
Name: ____________________________
Title: ___________________________
[SIGNATURE PAGE TO SERIES D PREFERRED STOCK PURCHASE AGREEMENT]
