STOCK PURCHASE AGREEMENT
THIS AGREEMENT ("Agreement") is made and entered into as of June 12, 1998,
by and among Xxx. Xxxxxx' Holding Company, Inc., a Delaware corporation (the
"Buyer"), and Xxxxxx X. Xxxxxxxxx, shareholder of Pretzel Time, Inc., a
Pennsylvania corporation (the "Company"), who becomes the "Seller". The Buyer
and the Seller are referred to collectively herein as the "Parties."
A. The Seller owns forty (40) 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, ten (10)
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 acquiring common stock in the Company, and
is also entering into other related transactions (collectively, the "Related
Transactions");
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 Eighty Seven Thousand Five Hundred Dollars ($87,500)
per Share (the "Purchase Proceeds") for a total of Eight Hundred Seventy
Five Thousands Dollars ($875,000) (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 June 12, 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,
including the stock
certificate(s) representing each of the Seller's Shares, endorsed in blank
or accompanied by duly executed assignment documents.
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, the Seller is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation.
(ii) Authorization of Transaction. The Seller has full power and
authority (including, if the Seller is a corporation, full corporate
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
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.
2
(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.
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
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
3
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 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
their 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 of 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 Buyer shall have obtained on terms and conditions
reasonably satisfactory to it all of the financing required to
consummate the transactions contemplated hereby and by the Related
Transactions.
(vi) The Seller shall be prepared to deliver the certificates
and documents in the form and executed as required by this Agreement.
(vii) 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.
(viii) The Closing of the Related Transactions shall have
occurred.
(ix) Neither the Company nor the Principal Shareholder shall be
in breach under the terms and conditions of any of the Stock
Acquisition Agreement (as
4
defined in Section 6 below) and the documents executed in connection
with the Related Transactions.
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.
(b) Conditions to Obligation of the Seller. The obligation of the
Seller to consummate the transactions to be performed by them 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
Proceeds as required by Section 1(b).
(iii) The Closing of the Related Transactions shall have
occurred.
The Seller may waive any condition specified in this Section 5(b) if they
execute 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 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
5
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 Fields with respect to any
matter (a "Third Party Claim") which may give rise to a claim for
indemnification against the Seller under this (S) 6, then Fields shall promptly
notify the Seller thereof in writing, provided, however, that no delay on the
part of Fields 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 "Acquisition
Agreement"), by and between Fields, the Company and the Seller (therein referred
to as the Principal Shareholder).
(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 Stock Acquisition Agreement, and the indemnity payment for such
claims shall be determined as if such claims were made under the Stock
Acquisition Agreement.
(iv) The foregoing indemnification provisions are in addition
to, and not in derogation of, any statutory, equitable, or common law remedy
Fields 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 June 30, 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.
6
(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.
(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 Xxxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, 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' Holding Company, Inc.
000 Xxxx Xxxxxxx Xxxxx
Xxxx Xxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, President
7
With a Copy to: Jones, Waldo, Xxxxxxxx & XxXxxxxxx
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
and made a part hereof.
8
(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' HOLDING COMPANY, INC.
By: /s/ [SIGNATURE ILLEGIBLE]
-------------------------------------
Its: V.P.
--------------------------------
SELLER:
/s/ Xxxxxx X. Lisiowski
-------------------------------------
Xxxxxx X. Lisiowski
9
DISCLOSURE SCHEDULE TO STOCK ACQUISITION AGREEMENT
Section 2(a):
------------
None, unless otherwise stated below.
/s/ [SIGNATURE ILLEGIBLE] M.L.
--------------------------- -----------------
Buyer's Initials Seller's Initials
