STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (hereinafter referred to as the
"Agreement"), originally entered into on the 1st day of April 1999 and
being memorialized in writing on this 3rd day of January 2002, by and among Xxxx
X. Xxxxxxx, Xxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx and Xxxx Xxxx (hereinafter
referred to collectively as the "Sellers"), J.S. Transportation, Inc., a New
Jersey corporation, (hereinafter referred to as the "Company" or "JST") and New
York Regional Rail Corporation, a Delaware corporation, located at 0000 Xxxxx
Xxxxxx, Xxxxxxxx, XX 00000 (hereinafter referred to as "Buyer" or "NYRR").
WITNESSETH:
WHEREAS, the Company is engaged in trucking operations;
WHEREAS, Sellers are the owners of all of the issued and outstanding
capital stock of the Company;
WHEREAS, on February 25, 1999 the Company purchased certain assets and
customer list from Xxxxxx X. Xxxx for use in its trucking operations;
WHEREAS,Buyer desires to diversify its business operations by acquiring
an ownership interest in a trucking operation;
WHEREAS, Sellers desire to transfer fifty one percent (51%) of the
issued and outstanding corporate stock of the Company and Buyer desires to
acquire fifty one percent (51%) of the issued and outstanding corporate stock of
the Company.
NOW, THEREFORE, in consideration of the premises and of the mutual
promises, covenants, representations and warranties herein contained, the
parties hereto, intending to be legally bound by the terms hereof, covenant and
agree as follows:
1. Sale and Purchase of Stock. Subject to the terms and conditions contained
herein, on the Closing Date (as hereinafter defined) Sellers in reliance
upon the representations and warranties of Buyer contained herein, shall
sell to Buyer, and Buyer in reliance upon the representations and
warranties of Seller contained herein, shall purchase from Sellers, fifty
one percent (51%) of the issued and outstanding capital stock of the
Company.
2. Consideration. On the Closing Date, Buyer shall transfer to Sellers five
million (5,000,000) unregistered shares of the class "A" common stock
of New York Regional Rail Corporation (hereinafter referred to as the
"Shares"). The Shares shall be restricted for a period of one year
from the Closing Date. The Shares shall be registered with the
Securities Exchange Commission (hereinafter referred to as the "SEC")
when Buyer files its next Common Stock registration with the SEC. On
the Closing Date Buyer shall also transfer to the Company one hundred
and fifty thousand dollars ($150,000) to be used only to reduce the
debt the Company. In lieu of a cash transfer Seller has agreed to
accept, 1,000,000 unrestricted shares of Class "A" common stock of New
York Regional Railroad, which shares shall be registered with the SEC
when Buyer files its next Common Stock registration.
3. Representations, Warranties and Covenants of Sellers. Sellers
represent, warrant and covenant to Buyer that:
(a) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of New
Jersey; has full corporate power and authority to carry on
its business as it is now being conducted and to own and
operate the properties and assets now owned or operated by
it; is duly qualified to do business and is in good standing
in each jurisdiction where, in the good faith judgment of
the management of the Company, the conduct of its business
or the ownership of its property and assets requires such
qualification. A complete and correct copy of the Articles
of Incorporation of The Company together with all amendments
thereto, certified by the Secretary of State of New Jersey,
a complete and correct copy of the By-Laws of the Company
together with all amendments thereto have been delivered to
Buyer.
(b) The authorized capital stock of the Company consists solely of
2500 shares of Class A, no par, Common Stock. At Closing there
will be 1000 shares in the aggregate issued, outstanding and
owned by Sellers (hereinafter referred to as the "Sellers'
Stock"). At Closing, all issued and outstanding shares will be
fully paid and non-assessable and will have been issued in
compliance with all applicable federal and state securities
laws.
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(c) On the Closing Date Sellers will be the sole registered, legal
and beneficial owners of the Sellers' Stock and will have good
and marketable title to the Sellers' Stock, free and clear of
any pledges, claims, liens, assessments, encumbrances or
restrictions of any nature whatsoever, including, without
limitation, existing agreements, subscriptions, options,
warrants, calls, commitments or rights of any nature granting
to any party an interest in or right to acquire any of the
outstanding capital stock of the Company now or at the Closing
Date owned by Sellers.
(d) There are no outstanding securities of the Company which are
convertible into shares of the Company and there exist no
agreements, subscriptions, options, warrants, calls,
commitments or rights to purchase shares of the Company or any
such securities convertible into shares of the Company.
(e) Sellers have full power and authority or will obtain all
approvals necessary for them to enter into this Agreement and
to transfer 51% of Sellers' Stock to Buyer upon the terms and
conditions set forth herein and to vest good and marketable
title to 51% of the Sellers' Stock in Buyer and upon the sale
and delivery of 51% of the Sellers' Stock on the Closing Date
good and marketable title thereof, free and clear of any
pledges, claims, liens, assessments, encumbrances or
restrictions of any nature whatsoever, shall pass to and vest
in Buyer.
(f) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby in the
manner herein provided will:
(i) contravene any provision of the Articles of
Incorporation or By-Laws of the Company;
(ii) violate, be in conflict with, constitute a
default under, cause the acceleration of any
payments pursuant to or otherwise impair the
good standing, validity and effectiveness of
any agreement, contract, indenture, lease or
mortgage, or subject any properties or assets
of the Company to any indenture, mortgage,
contract, commitment or agreement (other than
the present Agreement) to which Sellers or the
Company is a party or to which Sellers or the
Company is subject; or
(iii) violate any provision of law, rule, regulation,
order,permit or license to which the Company is
subject or pursuant to which the Company
conducts its business.
(n) Neither Sellers nor the Company has offered, paid or agreed to
pay, directly or indirectly, any money or anything of value to
any individual who is an official or employee of any
governmental agency, either federal or state, or any agency or
instrumentality for the purpose of inducing that individual to
use his or her influence to obtain or maintain business or any
other benefit of the Company, nor has the Company made any
political payment or contribution in contravention of law.
(o) Sellers represent that they will make available to the Company
working loan capital in the amount of One Hundred Thousand
Dollars ($100,000). These funds may be reduced by Seller by
all funds contributed to the Company from the date beginning
March 1, 1999.
4. Representations and Warranties of Buyer. Buyer represents and warrants
to Sellers that:
(a) Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has
full corporate power and authority to carry on its business as it is
now being conducted and to own and operate the properties and assets
now owned or operated by it.
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(b) Buyer has full corporate power and authority to enter into
this agreement and to purchase and take title to 51% of the Sellers'
Stock upon the terms and conditions set forth herein.
(c) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby in the manner
herein provided will:
(i) contravene any provision of the Articles
of Incorporation or By-Laws of Buyer,
(ii) violate, be in conflict with,
constitute a default under, cause the
acceleration of any payments pursuant to or
otherwise impair the good standing, validity
and effectiveness of any lease, license,
permit, authorization or approval applicable
to Buyer; or
(iii) violate any provision of law, rule,
regulation, order, or permit to which Buyer
is subject or pursuant to which Buyer
conducts its business.
(d) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been
duly approved by all necessary corporate action on the part of
Buyer.
(e) The Shares to be issued to Seller hereunder are duly
authorized and, when issued to Seller in accordance with the
terms of this Agreement, will be validly issued, fully paid
and nonassessable.
5. Conduct of Business of the Company Pending the Closing. Sellers
represent, warrant, and covenant that from and after the date hereof to
the Closing Date, except as otherwise contemplated by this Agreement, the
Company will conduct its business solely in the ordinary course
(including regular employee bonus programs) and will:
(a) not amend its Articles of Incorporation or By-Laws except
as may be necessary to carry out this Agreement or as required
by law;
(b) not issue any capital stock or other securities, enter
into any contract, commitment or agreement to issue any
capital stock or other securities of the Company or issue any
warrants, rights or options to purchase or otherwise acquire
any capital stock of the Company;
(c) not declare, authorize or make any distribution or
dividend of cash, property or securities to any of its
shareholders, directly or indirectly;
(d) not merge or consolidate with any other corporation or
entity; sell, transfer or otherwise dispose of any priority or
assets other than in the ordinary course of business; or
acquire or agree to acquire or be acquired by any corporation,
association, partnership, joint venture or other entity;
(e) not enter into any agreement not in the ordinary course of
business or, without the prior written consent of Buyer, any
agreement for the acquisition of additional operating
authorities;
(f) not create, incur, assume or guarantee any indebtedness
for money borrowed or create or suffer to exist any mortgage,
lien or other encumbrance on any of its property or assets,
real or personal, other than encumbrances on property and
assets created in the ordinary course;
(g) not pay, discharge, compromise or otherwise satisfy any
liability or obligation of the Company other than in the
ordinary course of business and otherwise in accordance with
this Agreement;
(h) not cancel, waive or modify any debts, claims or other
rights owned by, or running in favor of, the Company;
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(i) not make any capital expenditures or capital additions or
betterments except such as may be involved in ordinary
repairs, maintenance, and replacements; or
(j) not change any accounting principle or practice or the
method of applying any such principle or practice.
(k) maintain the Company facilities, assets and properties in
good operating repair, order and condition, reasonable wear
and tear excepted;
(l) maintain in full force and effect insurance coverage of
the types and in the amounts currently carried by the Company;
(m) maintain in full force and effect all agreements,contracts
leases, licenses, permits, authorizations or approvals
necessary for or related to the operation of the business of
the Company. in all respects and places as such businesses are
now conducted;
(n) use its best efforts to preserve the Company's business
organization intact;
(o) provide Buyer the opportunity to be kept apprised of the
activities of the management of the Company, and during normal
business hours, with full access to all books, records,
equipment, real estate, contracts and other assets of the
Company and, insofar as the same are relevant to its truck-
related assets,.; make available to Buyer all such documents,
copies of documents and records and information with respect
to the affairs of the Company and the truck-related business
as Buyer may request and furnish to Buyer and Buyer's
representatives copies of any working papers relating to such
documents and records as Buyer shall from time to time
request.
6. Board of Directors. The Board of Directors of the Company shall initially
consist of five members. Sellers shall be entitled to designate three of
the initial Directors and Buyer shall be entitled to designate two of the
initial Directors.
7. The Closing. The Closing Date shall be not later than April 15, 1999 at
10:00am at the offices of Xxxx X. Xxxxxxx located at 00 Xxxxxxxx Xxxxx,
0xx Xxxxx, Xxx Xxxx, XX.
8. Brokerage; Expenses. The Sellers and the Buyer represent, warrant and
covenant that all negotiations relative to this Agreement have been
carried on by them directly without the intervention of any other person
and Sellers will indemnify Buyer and/or the Company and hold each of them
harmless against and in respect of any claim for brokerage or other fees
or commissions relative to this Agreement or the transactions
contemplated hereby. The Buyer agrees similarly to indemnify the Sellers
as to any such claims made by any person, firm or corporation claiming
through Buyer. Except as otherwise expressly provided in this Agreement,
Seller and the Buyer agree to bear their respective expenses
individually, each in respect of all expenses of any character incurred
by it in connection with this Agreement or the transactions contemplated
hereby.
9. Contents of Agreement. This Agreement sets forth the entire understanding
of the parties hereto with respect to the transactions contemplated
hereby and shall not be amended or terminated except by written
instrument duly executed by each of the parties hereto. Any and all
previous written agreements or verbal understandings between the parties
regarding the subject matter hereof are superseded in their entirety by
this Agreement.
10. Binding Effect and Assignees. All terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by
each of the parties and their respective heirs, personal representatives,
successors and assigns. Neither Buyer nor Sellers shall assign their
respective rights nor delegate their respective obligations hereunder to
any person without the prior written consent of the other party hereto.
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11. Notices. All notices, requests, demands, waivers, consents, approvals,
or other communications which are required or permitted hereunder shall
be in writing and delivered personally or by register or certified mail,
postage prepaid, as follows:
If to Buyer:
Xxxxxx X. Xxxxxxx
0000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
If to Sellers:
Xxxxxx Xxxxxx
000 x Xxxxxxx Xxx
Xxxxxx, XX 00000
Or at such other address as the party entitled to receive such notice
may, from time to time, specify.
12. Shareholder Distributions. Shareholder distributions will be made
monthly and be based on percentages owned.
13. New Jersey Law to Govern. This Agreement shall be governed as to its
validity, interpretation and effect by the laws of the State of New
Jersey.
14. Section Headings. All section headings herein have been inserted for
convenience of reference only and shall in no way modify or restrict
any of the terms or provisions hereof.
15. Exhibits. All Exhibits referred to in this Agreement are intended to
be and are hereby specifically incorporated by reference herein.
16. Further Actions and Assurances. The parties hereto shall execute and
deliver such additional documents and shall cause such further and
additional action to be taken, either before or after the Closing Date,
which may be required or, in the judgment of the parties, necessary or
desirable to effect or evidence the provisions of this Agreement and
the transactions contemplated hereby.
17. Counterparts.This Agreement may be executed in two or more counterparts
each of which shall be deemed an original but all of such counterparts
together shall constitute but one and the same instrument. It shall not
be necessary in making proof of this Agreement or any counterpart
hereof to produce or account for any of the other counterparts.
IN WITNESS WHEREOF, the parties verbally agreed to these terms as of
the day and year first above written and executed this written Agreement on this
3rd day of January 2002.
SELLERS
/s/ Xxxx Xxxxxxx
-----------------------------
Xxxx X. Xxxxxxx
/s/ Xxxxxx x. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxxxxx X. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx
/s/ Xxxx Xxxx
-----------------------------
Xxxx Xxxx
BUYER
New York Regional Rail Corporation
/s/ Xxxxxx x. Xxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxx, President & CEO
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