STOCK PURCHASE AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of
December 9, 1998, by and among Xxx. Xxxxxx' Original Cookies, Inc., a Delaware
corporation (the "Buyer"), and Xxxxxx X. Xxxxxxxxx, a shareholder of Pretzel
Time, Inc., a Pennsylvania corporation (the "Company"), (the "Seller"). The
Buyer and the Seller are referred to collectively herein as the "Parties."
A. The Seller owns thirty (30) shares of the issued and outstanding
common stock of the Company;
B. This Agreement contemplates a transaction in which the Buyer will
purchase from the Seller, and the Seller will sell to the Buyer, three (3)
shares of the outstanding common stock (par value $10.00 per share) of the
Company owned by the Seller (the "Shares"), as part of a series of transactions
in which the Buyer is ultimately acquiring all of the common stock in the
Company.
WHEREAS, the Buyer will purchase the Shares of the Company in return
for cash as set forth below.
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 agree as follows.
1. Purchase and Sale of Shares.
(a) Basic Transaction. On and subject to the terms and
conditions of this Agreement, the Buyer agrees to purchase from the
Seller, and the Seller agrees to sell to the Buyer, each of the Shares
for the consideration specified below in Section 1(b).
(b) Purchase Price. The Buyer agrees to pay to the Seller at
the Closing the sum of Five Hundred Thousand Dollars ($500,000) (the
"Purchase Price"), by delivery of certified funds for the Purchase
Price payable in accordance with this Agreement.
(c) The Closing. The closing of the transactions contemplated
by this Agreement (the "Closing") will take place at the offices of
the Buyer in Salt Lake City, Utah, on or before December 9, 1998 (the
"Closing Date"), unless extended by written agreement of the Parties.
(d) Deliveries at the Closing. At Closing, the Seller will
deliver to
the Buyer, the various documents referred to in Section 5(a) below.
The Seller acknowledges that the Company will (A) cancel the Seller's
existing share certificate(s) at the Closing, (B) issue and deliver
certificate(s) to the Buyer for the three (3) Shares of the Company's
common stock purchased by the Buyer from the Seller pursuant to this
Agreement, and (C) issue and deliver certificate(s) to the Seller for
his remaining twenty seven (27) Shares of the Company's common stock.
2. Representations and Warranties Concerning the Transaction.
(a) Representations and Warranties of the Seller. The Seller
represents and warrants to the Buyer that the statements contained in
this Section 2(a) are correct and complete as of the date of this
Agreement and will 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(a)) with respect
to himself except as set forth on the Disclosure Schedule affixed
hereto.
(i) Organization of Certain Seller. If the Seller is a
corporation or other entity, the Seller is duly organized,
validly existing, and in good standing under the laws of the
jurisdiction of its organization.
(ii) Authorization of Transaction. The Seller has full
power and authority (including, if the Seller is an entity, full
power and authority) to execute and deliver this Agreement and to
perform his obligations hereunder. This Agreement constitutes the
valid and legally binding obligation of the Seller, enforceable
in accordance with its terms and conditions. The Seller need not
give any notice to, make any filing with, or obtain any
authorization, consent or approval of any government or
governmental agency in order to consummate the transactions
contemplated by this Agreement.
(iii) Noncontravention. To the best of Seller's knowledge,
neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will (A)
violate any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge or other restriction of
any government, governmental agency or court to which the Seller
is subject or, if the Seller is a corporation, any provision of
its charter or bylaws, or (B) conflict with, result in a breach
of, constitute a default under, result in the acceleration of,
create in any party the right to accelerate, terminate, modify or
cancel, or require any notice under any agreement, contract,
lease, license, instrument or other
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arrangement to which the Seller is a party or by which the Seller
is bound or to which any of the Seller's assets is subject.
(iv) Brokers' Fees. The Seller 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 Buyer could become liable or obligated.
(v) Shares. The Seller holds of record and owns
beneficially the number of Shares (but no more or other shares of
the common stock of the Company than) set forth in paragraph A
above. The Seller holds and owns each of the Shares free and
clear of any restrictions on transfer, any federal, state or
local taxes of any kind, taxes, mortgage, pledge, lien,
encumbrance, charge or other security interests, options,
warrants, purchase rights, contracts, commitments, equities,
claims and demands. Other than this Agreement and other written
agreements with the Company and/or the Buyer, the Seller is not a
party to (A) any option, warrant, purchase right, shareholders
agreement, co-sale agreement, buy-sell agreement or other
contract or commitment that could require the Seller to sell,
transfer or otherwise dispose of any capital stock of the Company
(other than this Agreement), or (B) any voting trust, proxy or
other agreement or understanding with respect to the voting of
any capital stock of the Company.
(vi) Legal Compliance/Litigation. To the best of his
knowledge, the Seller and his respective predecessors and
affiliates have complied with all applicable laws of federal,
state, local and foreign governments (and all agencies thereof),
and no action, suit, proceeding, hearing, investigation, charge,
complaint, claim, demand or notice has been filed or commenced
against any of them alleging any failure so to comply. To the
best of his knowledge, there are no outstanding injunctions,
judgments, orders, decrees, rulings or charges affecting their
Shares. To the best of his knowledge, there are no actions,
suits, proceedings, hearings or investigations, and the Seller
does not have reason to believe that any such action, suit,
proceeding, hearing or investigation may be brought or
threatened, against the Seller.
(vii) Investigation. The Seller has investigated or had
full opportunity to investigate the terms and conditions of the
transactions contemplated by this Agreement, including the
Purchase Price, and deems them to be fair and appropriate.
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3. Pre-Closing Covenants. With respect to the period between the
execution of this Agreement and the Closing, (A) each of the Parties will use
its/his 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, (B) the Seller will use his best
efforts to obtain any third-party consents that the Buyer may request or to
otherwise consummate the transactions contemplated hereby, and (C) the Seller
will give prompt written notice to the Buyer of any material adverse development
causing a breach of any of the representations and warranties in Section 2
above.
4. Post-Closing Covenants. The Parties agree that if at any time
after the Closing any further action is necessary or desirable to carry out the
purposes of this Agreement, each of the Parties will take such further action
(including the execution and delivery of such further instruments and documents)
as any other Party reasonably may request.
5. Conditions to Closing.
(a) Conditions to Obligation of the Buyer. The obligation of
the Buyer to consummate the transactions to be performed by it in
connection with the Closing is subject to the satisfaction (or waiver
by the Buyer) of the following conditions:
(i) The representations and warranties set forth in
Section 2 above shall be true and correct in all material
respects at and as of the Closing Date.
(ii) The Seller shall have performed and complied with
all of his covenants hereunder in all material respects through
the Closing.
(iii) The Seller shall have procured any third party
consents required for the sale of the Shares.
(iv) 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, (B) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation, or (C) affect
adversely the right of the Buyer to own the Shares.
(v) The Seller shall be prepared to deliver the
certificates
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and documents in the form and executed as required by this
Agreement.
(vi) All actions to be taken by the Seller in connection
with consummation of the transactions contemplated by this
Agreement, and all certificates, and other documents required to
effect the transactions contemplated hereby, will be satisfactory
in form and substance to the Buyer.
(vii) [Intentionally omitted.]
(viii) Neither the Company nor the Seller shall be in
breach under any of the terms and conditions of any of the Stock
Acquisition Agreements (as defined in Section 6 below) and the
documents executed in connection with the Related Transactions
(as defined in the First Acquisition Agreement as defined below).
The Buyer may waive any condition specified in this Section 5(a) if it
executes a writing so stating at or prior to the Closing. The Buyer's
waiver of any condition to Closing set forth in Section 5(a)(viii)
above shall not constitute a waiver of any breach (or a waiver of any
right or remedy arising from any breach) by the Seller of any of the
Stock Purchase Agreements or the documents executed in connection with
the Related Transactions.
(b) Conditions to Obligation of the Seller. The obligation of
the Seller to consummate the transactions to be performed by him in
connection with the Closing is subject to satisfaction of the
following conditions:
(i) No action, suit or proceeding shall be pending
threatened before any court or quasi-judicial or administrative
agency of any federal, state, local or foreign jurisdiction for
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 between the Buyer
and the Seller contemplated by this Agreement to be rescinded
following consummation (and no such injunction, judgment, order,
decree, ruling or charge shall be in effect).
(ii) The Buyer shall be prepared to deliver the Purchase
Price as required by Section 1(b).
(iii) [Intentionally Omitted.]
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The Seller may waive any condition specified in this Section 5(b) if
he executes a writing so stating at or prior to the Closing.
6. Remedies for Breaches of This Agreement.
(a) Survival of Representations and Warranties. All of the
representations and warranties of the Seller contained in this
Agreement shall survive the Closing hereunder (even if the damaged
Party 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
forever thereafter (subject to any applicable statutes of
limitations).
(b) Indemnification Provisions for Benefit of the Buyer.
(i) In the event the Seller breaches any of its
representations, warranties, and covenants contained herein, and,
if the Buyer makes a written claim for indemnification against
any of the Seller therefor, then, the Seller agrees to indemnify
the Buyer from and against the entirety of any Adverse
Consequences (as defined in the First Acquisition Agreement) that
the Buyer may suffer through and after the date of the claim for
indemnification (including any Adverse Consequences the Buyer may
suffer after the end of any applicable survival period) resulting
from, arising out of, relating to, in the nature of, or caused by
the breach.
(ii) If any third party shall notify Buyer or Fields
(defined below) with respect to any matter (a "Third Party
Claim") which may give rise to a claim for indemnification
against the Seller under this ' 6, then Buyer or Fields, as
applicable, shall promptly notify the Seller thereof in writing,
provided, however, that no delay on the part of Fields or Buyer,
as applicable, in notifying the Seller shall relieve the Seller
from any obligation hereunder unless (and then solely to the
extent) the Seller is prejudiced. The indemnification procedure
respecting a Third Party Claim hereunder shall be the same as set
forth in Section 9(c) of that certain Stock Acquisition
Agreement, dated as of September 2, 1997 (the "First Acquisition
Agreement"), by and between Xxx. Xxxxxx' Holding Company, Inc., a
Delaware corporation ("Fields"), the Company and the Seller
(therein referred to as the Principal Shareholder). (For purposes
of this Agreement, the term Stock Acquisition Agreements shall
mean collectively (A) the First Acquisition Agreement, (B) the
Stock Purchase Agreement, dated as of January 2, 1998, by and
between Fields and the Seller, and (C) the Stock Purchase
Agreement, dated as of June 12, 1998, by
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and between Fields and the Seller.)
(iii) All claims for indemnification made under this
Agreement shall be subject to the terms and conditions of
Sections 9(d) (Determination of Adverse Consequences), (f)
(Rights of Offset) and (g) (Limitation of Rights of Offset) of
the First Acquisition Agreement, and the indemnity payment
required of the Seller for such claims shall be determined as if
the claims were made under the First Acquisition Agreement.
(iv) The foregoing indemnification provisions are in
addition to, and not in derogation of, any statutory, equitable,
or common law remedy Fields or the Seller may have for breach of
representation, warranty, or covenant.
7. Termination.
(a) Termination of Agreement. The Parties may terminate this
Agreement as provided below:
(i) The Buyer and the Seller may terminate this
Agreement by mutual written consent at any time prior to the
Closing.
(ii) The Buyer or the Seller may terminate this Agreement
if the Closing does not occur on or before December 15, 1998.
(b) Effect of Termination. If any Party terminates this
Agreement pursuant to this Section, 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).
8. Miscellaneous.
(a) 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.
(b) Entire Agreement. This Agreement (including the 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 relate in
any way to the subject matter hereof.
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(c) 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 his or its rights, interests or
obligations hereunder without the prior written approval of the Buyer
and the Seller; provided, however, that the Buyer may (i) assign any
or all of its rights and interests hereunder to one or more of its
affiliates, and (ii) designate one or more of its affiliates to
perform its obligations hereunder (in any or all of which cases the
Buyer nonetheless shall remain responsible for the performance of all
of its obligations hereunder).
(d) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of
which together will constitute one and the same instrument.
(e) Headings. The 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.
(f) Notices. All notices, requests, demands, claims and other
communications hereunder will be in writing. Any notice, request,
demand, claim or other communication hereunder shall be deemed duly
given if (and then two business days after) it is sent by registered
or certified mail, return receipt requested, postage prepaid, and
addressed to the intended recipient as set forth below:
If to the Seller: Xxxxxx X. Xxxxxxxxx
0000 X.X. 0xx Xxxxx
Xxxx Xxxxx, XX 00000
With a copy to: Mette, Xxxxx & Xxxxxxxx
Attention: Xxxxx X. Xxxxxx
0000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
If to the Buyer: Xxx. Xxxxxx' Original Cookies, Inc.
0000 X. Xxxxxxxxxx Xxxxxxx, Xxxxx 000
Xxxx Xxxx Xxxx, XX 00000
Attention: Legal Department
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With a Copy to: Jones, Waldo, Xxxxxxxx & XxXxxxxxx, P.C.
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxx
Any Party may send any notice, request, demand, claim or other
communication hereunder to the intended recipient at the address set
forth above using any other means (including personal delivery,
expedited courier, messenger service, telecopy, telex, ordinary mail
or electronic mail), but no such notice, request, demand, claim or
other communication shall be deemed to have been duly given unless and
until it actually is received by the intended recipient. Any Party may
change the address to which notices, requests, demands, claims and
other communications hereunder are to be delivered by giving the other
Parties notice in the manner herein set forth.
(g) Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of Utah
without giving effect to any choice or conflict of law provision or
rule thereof.
(h) Amendments and Waivers. No amendment of any provision of
this Agreement shall be valid unless the same shall be in writing and
signed by the Buyer and each of the Sellers. 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.
(i) 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.
(j) Expenses. Each of the Parties will bear his or its own
costs and expenses (including legal fees and expenses) incurred in
connection with this Agreement and the transactions contemplated
hereby. The Seller agrees that none of the Company and its
Subsidiaries has borne or will bear any of the Seller's costs and
expenses (including any of their legal fees and expenses) in
connection with this Agreement or any of the transactions contemplated
hereby.
(k) Incorporation of Exhibits and Schedules. The Exhibits and
Schedules identified in this Agreement are incorporated herein by
reference
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and made a part hereof.
(l) 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 to which they may be entitled, at law or in equity.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first above written.
BUYER: XXX. XXXXXX' ORIGINAL COOKIES, INC.
By:
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Its:
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SELLER:
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Xxxxxx X. Xxxxxxxxx
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DISCLOSURE SCHEDULE TO STOCK ACQUISITION AGREEMENT
Section 2(a):
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None, unless otherwise stated below.
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Buyer's Initials Seller's Initials
