EXHIBIT 10.22
AGREEMENT FOR PURCHASE AND SALE OF STOCK
OF TOMORROW'S MORNING, INC.
This Agreement for Purchase and Sale of Stock of Tomorrow's Morning, Inc.
(the "Agree ment") is entered into on December 14, 1998, by and between Xxxxxxxx
Xxxxxx (the "Buyer") and Tomorrow's Morning, Inc. (the "Company") with reference
to the following facts and circumstances:
A. Concurrently herewith, Buyer has loaned to the Company the sum of
$100,000 (the "Loan").
B. In consideration for the Loan, the Company desires to transfer to Buyer
100,000 shares of the Company's no par value Common Stock (the "Shares"), and
Buyer desires to acquire the Shares from the Company, in each case on the terms
set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
1. SALE OF SHARES. In consideration for the Loan and without the
requirement of any additional payment, Seller hereby sells the Shares to Buyer,
and Buyer hereby purchases the Shares from Seller.
2. REPRESENTATIONS AND WARRANTIES.
(a) AUTHORITY AND TITLE. The Company warrants and represents that (i)
it has the full right, power and authority to enter into this Agreement and (ii)
Buyer will acquire good title to the Shares free and clear of all claims, liens,
encumbrances, restrictions and other rights, other than as set forth in the
legend specified in Section 4 below.
(b) BUYER'S KNOWLEDGE AND SOPHISTICATION. Buyer warrants and represents
that (i) he is familiar with the Company's operations, (ii) he has had the
opportunity to examine the Company's most recent financial statements, (iii) he
is aware of the extent of the Company's business, assets and liabilities, (iv)
he is acquiring the Shares for investment and not for distribution and (v) by
reason of his business and financial experience, he has the capacity to protect
his interests regarding the Shares and to evaluate the merits and risks of an
acquisition of the Shares.
3. REGISTRATION UNDER SECURITIES ACT OF 1933.
(a) REGISTRATION RIGHTS. The Company agrees that if, at any time and
from time to time, the Board of Directors of the Company shall authorize the
filing of a registration statement or a post-effective amendment to a
registration statement other than the registration statement for the Company's
initial public offering (Registration No. 333-4792-LA) (any such fees and
expenses in connection with all registration statements filed pursuant to this
Section 3 including, without limitation, registration filing fees, the Company's
legal and accounting fees, printing
expenses, and blue sky fees and expenses, (iii) to take all necessary action
which may be required in qualifying or registering the Shares included in a
registration statement for offering and sale under the securities or blue sky
laws of such states as reasonably are requested by Buyer; provided that the
Company shall not be obligated to execute or file any general consent to service
of process or to qualify as a foreign corporation to do business under the laws
of any such jurisdiction, (iv) to furnish to Buyer (and to each underwriter, if
any), an opinion of counsel to the Company dated the effective date and the
closing date and a "cold comfort" letter dated the effective date and closing
date and (v) to indemnify Buyer against all loss, claim, damage, expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which Buyer may become
subject under the Act, the Exchange Act or any other statute, common law or
otherwise, arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in such registration statement executed
by the Company or based upon written information furnished by the Company filed
in any jurisdiction in order to qualify the Shares under the securities laws
thereof or filed with the Commission, any state securities commission or agency,
the National Association of Securities Dealers, Inc., The Nasdaq Stock Market or
any securities exchange, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the statements
contained therein not misleading, unless such statement or omission was made
specifically in reliance upon and in conformity with written information
furnished to the Company by Buyer expressly and specifically for use in such
registration statement, any amendment or supplement thereto or any application,
as the case may be. The Company agrees promptly to notify Buyer of the
commencement of any litigation or proceedings against the Company or any of its
officers, directors or controlling persons in connection with the resale of the
Shares or in connection such registration statement. Buyer, and his successors
and assigns, shall severally, and not jointly, indemnify the Company, its
officers and directors and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act,
against all loss, claim, damage or expense or liability (including all expenses
reasonably incurred in investigating, preparing or defending against any claim
whatsoever) to which they may become subject under the Act, the Exchange Act or
otherwise, arising from information furnished in writing by or on behalf of
Buyer or his successors or assigns, expressly for specific inclusion in such
registration statement; provided, however, that the obligations of Buyer
hereunder shall be limited to an amount equal to the proceeds to Buyer from the
sale of the Shares. Each party entitled to indemnification under this Section
5(b) (the "Indemnified Party") shall give notice to the party required to
provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or any
litigation resulting therefrom, shall be approved by the Indemnified Party
(whose approval shall not be unreasonably withheld), and the Indemnified Party
may participate in such defense at such party's expense; and provided further
that the failure of any Indemnified Party to give notice as provided herein
shall not relieve the Indemnifying Party of its obligations hereunder except to
the extent the Indemnifying Party is actually prejudiced. No Indemnifying Party,
in the defense of any such claim or litigation, shall, except with the consent
of each Indemnified Party (which consent shall not unreasonably be withheld),
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or
litigation. Each Indemnified Party shall furnish such information regarding
itself or the claim in question as an Indemnifying Party may reasonably request
in writing and as shall be reasonably required in connection with defense of
such claim and litigation resulting therefrom. Notwithstanding the foregoing
provisions of this Section 3, any such payment or reimbursement by Buyer of
fees, expenses or disbursements incurred by an indemnified person in any
proceeding in which a final judgment by a court of competent jurisdiction (after
all appeals or the expiration of time to appeal) is entered against the Company
or such indemnified person as a direct result of the Company or such person's
gross negligence or willful misfeasance will be promptly repaid to Buyer.
(c) RULE 144 REPORTING. With a view to making available the
benefits of certain rules and regulations of the Commission which may permit the
sale of the Shares to the public without registration, the Company agrees to use
its best efforts to (i) make and keep public information available, as those
terms are understood and defined in Rule 144 under the Act (and any successor
rule to Rule 144), and (ii) file with the Commission in a timely manner all
reports and other documents required of the Company under the Act and the
Exchange Act at all times while it is subject to such reporting requirements.
(d) TRANSFER OR ASSIGNMENT OF REGISTRATION RIGHTS. The rights
to cause the Company to register the Shares under this Section 3 may be
transferred or assigned by Buyer to a permitted transferee or assignee of the
Shares; provided that the Company is given written notice by Buyer at the time
of or within a reasonable time after said permitted transfer or assignment,
stating the name and address of said transferee or assignee and identifying the
securities with respect to which such registration rights are being transferred
or assigned and provided further that the transferee or assignee of such rights
assumes the obligations of Buyer under this Section 3.
4. TRANSFERABILITY.
(a) Subject to Section 3 above, the Shares have not been, and
will not be, registered under the Act or qualified under the laws of any
jurisdiction. In issuing the Shares, the Company has relied, among others, upon
the exemption from registration provided by Section 4(2) of the Act on the
ground that the Shares are to be issued in a transaction by an issuer not
involving any public offering.
(b) Buyer agrees not to offer, sell, transfer, pledge or
hypothecate any of the Shares without an effective registration statement for
such Shares under the Act and all required state qualifications or an opinion of
counsel satisfactory to the Company to the effect that such registration and
qualifications are not required.
(c) The certificates evidencing the Shares shall contain a
legend substantially in the form set forth below, and the Company may issue
orders to to its transfer agent for the Common Stock not to transfer the Shares
if such restrictions are not satisfied.
"THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED
PURSUANT TO THE SECURITIES ACT OF 1933
OR QUALIFIED UNDER THE LAWS OF ANY
STATE. THEY MAY NOT BE OFFERED, SOLD,
TRANSFERRED, PLEDGED OR HYPOTHECATED
IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AND ALL
REQUIRED STATE QUALIFICA TIONS OR AN
OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER HEREOF TO THE EFFECT THAT SUCH
REGISTRATION AND QUALIFICATIONS ARE
NOT REQUIRED."
5. FURTHER ACTS. At any time and from time to time, each party hereto
shall, at the request of the other party, perform or cause to be performed and
execute, acknowledge and deliver or cause to be executed, acknowledged and
delivered all such further acts, assignments and documents as may be necessary
or desirable to more fully consummate the transactions contemplated by this
Agreement.
6. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and any agreements or
instruments executed pursuant hereto or concurrently herewith contain the entire
agreement between the parties with respect to the transactions contemplated by
this Agreement and supersede all prior writings, negotiations and
understandings. Such documents contain all of the covenants, representations,
warranties, promises or agreements, oral or otherwise, that have been made by
any party, or anyone acting on behalf of any party, and no covenant,
representation, warranty, promise or agreement not contained therein shall be
binding or valid. No waiver or amendment of any provision of this Agreement
shall be effective unless in writing and signed by the party to be bound.
7. HEADINGS. The headings or captions in this Agreement are for
convenience and reference only and do not form a part hereof and do not in any
way modify, interpret or construe the intent of the parties or affect any of the
provisions of this Agreement.
8. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original and the counterparts shall together
constitute one and the same agree ment, binding each of the parties hereto,
notwithstanding that all of the parties are not signatory to the original or the
same counterpart.
9. SEVERABILITY. In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement and this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had never
been contained therein, provided that elimination of such provision does not
affect the fundamental terms of this Agreement.
10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without regard to the
conflicts of laws rules thereof.
11. NOTICES. No notice or other communication under this Agreement
shall be effective unless, but any notice or other communication shall be
effective and shall be deemed to have been given if, the same is in writing and
is mailed by first-class mail, postage prepaid, addressed to:
(a) the Company at 000 Xxxxx Xxxxxxxxxx Xxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000 or such other address as the Company has designated in writing
to Buyer; or
(b) Buyer at ____________________________________________, or
at such other address as Buyer has designated in writing to the Company.
12. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the parties herein shall survive the closing of the purchase and
sale of the Shares and continue in full force and effect at all times
thereafter.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
"BUYER":
--------------------------------
Xxxxxxxx Xxxxxx
"SELLER":
TOMORROW'S MORNING, INC.
By:
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Xxxx Xxxxxx, President