SECOND SUPPLEMENTAL PREFERRED STOCK
PURCHASE AGREEMENT
SECOND SUPPLEMENTAL PREFERRED STOCK PURCHASE AGREEMENT (this
"Agreement") made as of January 23, 1998, by and among JOTAN, INC., a
Florida corporation (the "Company"), RICE PARTNERS II, L.P., a Delaware
limited partnership ("Rice" or the "Purchaser"), F-SOUTHLAND, L.L.C., a
North Carolina limited liability company ("F-Southland"), FF-SOUTHLAND,
L.P., a Delaware limited partnership ("FF-Southland" and together with F-
Southland, the "Southland Purchasers"), F-JOTAN, L.L.C., a North Carolina
limited liability corporation ("F-Jotan"), and the SHAREHOLDER named on
the signature pages hereto (the "Shareholder").
W I T N E S S E T H:
WHEREAS, Rice, the Southland Purchasers, F-Jotan and the Shareholder
named on the signature pages thereof, executed and delivered the Preferred
Stock and Warrant Purchase Agreement, dated as of February 28, 1997 (the
"Original Purchase Agreement");
WHEREAS, the Company entered into that certain First Supplemental
Preferred Stock and Warrant Purchase Agreement dated as of September 10,
1997, by and among the Company, Rice, the Southland Purchasers, F-Jotan,
and the Shareholders named therein (the "First Supplemental Purchase
Agreement" and together with this Agreement and the Original Purchase
Agreement, as the same may be further, as the same may be modified,
amended, supplemented or restated from time to time, collectively being
called, the "Purchase Agreement");
WHEREAS, each Shareholder owns beneficially and of record the number
of shares or share equivalents set forth under the signature of such
Shareholder on this Agreement of the issued and outstanding capital stock
of the Company (reflecting the departure of Xxxxx Xxxxxxxx on December 31,
1997 from employment at the Company and the termination of his options to
purchase up to 275,000 of the Company's Common Stock);
WHEREAS, F-Jotan is the owner of the 1,435,705 shares of the Series A
Preferred Stock of the Company as of the date hereof;
WHEREAS, the Southland Purchasers and Rice are owners of shares of
Series B Preferred Stock and Warrants exercisable into the Company's
Common Stock, as set forth under the signature of each such party below;
WHEREAS, SHC Acquisition Corp., a wholly-owned Subsidiary of the
Company, has merged with and into Southland Holding Company, with
Southland Holding Company surviving and assuming all the obligations of
SHC Acquisition Corp. under the Original Purchase Agreement. On July 31,
1997, all of the subsidiaries of Southland Holding Company and Atlantic
Bag & Paper Company, a Subsidiary of the Company, merged with and into
Southland Holding Company (which concurrently changed its name to
Southland Container Packaging Corp.), with the result that Southland
Container Packaging Corp. ("Southland"), as of July 31, 1997, had no
Subsidiaries;
WHEREAS, the Company, Southland, Rice and the Southland Purchasers
have entered into that certain Note Purchase Agreement, dated as of
February 28, 1997, as amended by Amendment No. 1, dated as of August 19,
1997 and Amendment Xx. 0, xxxxx xx xx Xxxxxxxx 0, 0000 (xx the same may be
modified, amended, supplemented or restated from time to time the "Note
Agreement");
WHEREAS, the Company and the Shareholder have entered into a
Shareholder Agreement, dated as of February 28, 1997 (the "Original
Shareholder Agreement"), with Purchaser, the Southland Purchasers and F-
Jotan;
WHEREAS, the Company entered into that certain First Supplemental
Shareholder Agreement, dated as of September 10, 1997, with Rice, the
Southland Purchasers, F-Jotan, and the shareholders named therein (the
"First Supplemental Shareholder Agreement") and the Second Supplemental
Shareholder Agreement, dated as of the date hereof, with Rice, the
Southland Purchasers, F-Jotan and the Shareholder substantially in the
form attached hereto as Annex A (the "Second Supplemental Shareholder
Agreement" and together with the First Supplemental Shareholder Agreement
and the Original Shareholder Agreement, as the same may be further
modified, amended, supplemented or restated from time to time,
collectively being called, the "Shareholder Agreement");
WHEREAS, Rice and the Board of Directors of the Company have
determined that, in the best interest of the Company, Rice is willing
purchase, and the Company is willing to sell to Rice, $250,000 (the
"Purchase Price") of Series B Preferred Stock, in cash (the "Investment")
to enable the Company to make certain payments to certain individuals who
previously owned minority interests in certain subsidiaries of Southland;
WHEREAS, although Rice is willing to enter into and consummate the
transactions contemplated hereby upon the due issuance of its Preferred
Stock (as defined below) against the payment of the Purchase Price, the
Southland Purchasers have elected not to purchase Preferred Stock in this
transaction; and
WHEREAS, Rice and the Company have agreed that, unlike the First
Supplemental Purchase Agreement, Rice will not receive Warrants in
connection with the purchase of the Second Supplemental Preferred Shares
(as defined below).
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants contained in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, Purchaser, F-Jotan, the Shareholder, and the Company,
intending to be legally bound, agree as follows:
Article I
Definitions
As used in this Agreement, all capitalized terms have the meanings
indicated in the Original Purchase Agreement unless otherwise defined
herein. Any such term used in the Original Purchase Agreement, but not
defined herein, shall be interpreted to cover all corresponding terms used
herein and relating to the Warrants and Series B Preferred Stock to be
issued pursuant to this Agreement, as if such terms were set forth at
length herein and applied to the transactions contemplated hereby.
Agreement. This Second Supplemental Preferred Stock Purchase
Agreement, as the same may be modified, amended, supplemented or
restated from time to time.
Closing Date. With respect to this Agreement, as of the date first
set forth above.
Note Agreement. This term is defined in the preamble and includes
the Note Purchase Agreement, dated as of February 28, 1997, as
amended by Amendment No. 1, dated as of August 19, 1997 and Amendment
No. 2 dated as of November 6, 1997, as the same may be further
modified, amended, supplemented or restated from time to time, and
any refinancing, refunding or replacements of the indebtedness under
the Note Agreement.
Original Closing Date. The Closing Date with respect to the Original
Purchase Agreement, which occurred as of February 28, 1997 with
respect to the originally issued Warrants and Preferred Shares under
the Original Purchase Agreement and March 4, 1997 with respect to the
initial funding.
Preferred Stock or Series B Preferred Stock. For purposes of this
Agreement (except where the context requires a reference to this
Agreement and the Original Purchase Agreement), the Second
Supplemental Series B Preferred Stock.
Purchase Price. This term is defined in the preamble.
Purchaser. For purposes of the Second Supplemental Documents and the
First Supplemental Documents (as defined in the First Supplemental
Purchase Agreement), Rice; and for purposes of the Original Purchase
Agreement and the transactions contemplated thereby, Rice and the
Southland Purchasers.
Second Supplemental Documents. This Agreement, the Second
Supplemental Series B Preferred Stock and the Second Supplemental
Shareholder Agreement, and the transactions and documents,
instruments, certificates and agreements contemplated thereby, as the
same may be modified, amended, supplemented or restated from time to
time.
Second Supplemental Preferred Shares. Shares of Series B Preferred
Stock (but not any Series A Preferred Stock) to be issued to
Purchaser hereunder in connection with the Investment upon payment of
the applicable Purchase Price therefor.
Second Supplemental Series B Preferred Stock. Series B Preferred
Stock to be issued to the applicable Purchaser hereunder in
connection with the Investment upon payment of the applicable
Purchase Price therefor.
Shareholder Agreement. This term is defined in the Preamble.
Southland. This term is defined in the Preamble.
Article II
The Preferred Shares
2.01 The Preferred Shares. On the Closing Date, Rice agrees to
purchase from the Company at the purchase price set forth below, and the
Company agrees to issue to Rice, all in accordance with the terms and
conditions of this Agreement:
1,250 shares of Series B Preferred Stock, at a purchase price of
$200 per share (for a total of $250,000) having the rights,
restrictions, privileges, and preferences set forth in the articles
of amendment of the Company's articles of incorporation attached to
the Original Purchase Agreement as Annex H (the "Certificate").
The Company has duly authorized the Series B Preferred Stock being
purchased and sold pursuant to the terms of this Agreement by duly filing
the Certificate with the Secretary of State of the State of Florida.
Within forty-five (45) business days after the Closing Date, the Company
will deliver to Rice a certificate evidencing and representing the shares
of Second Supplemental Series B Preferred Stock issued to such Purchaser,
which certificate shall be issued in such Purchaser's name or in the name
of its designee.
2.02 Legend. The Company will deliver to Purchaser pursuant to
Section 2.01, one or more certificates representing the Second
Supplemental Series B Preferred Stock purchased by Rice in such
denominations as such Purchaser requests. Such certificates will be
issued in such Purchaser's name or, subject to compliance with transfer
and registration requirements under applicable Federal and state
securities laws, in the name or names of its respective designee or
designees.
It is understood and agreed that the certificates evidencing the
Second Supplemental Series B Preferred Stock will bear substantially the
same as the following legends:
"THESE SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW
TO OR FOR SALE IN CONNECTION WITH THE DISTRIBUTION HEREOF. THESE
SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS, INCLUDING, WITHOUT LIMITATION,
THE NORTH CAROLINA SECURITIES ACT, AS AMENDED, THE TEXAS SECURITIES
ACT OF 1957, AS AMENDED, AND THE GEORGIA SECURITIES ACT OF 1973, AS
AMENDED, AND MAY NOT BE PLEDGED, SOLD, OFFERED FOR SALE, TRANSFERRED,
OR OTHERWISE DISPOSED OF IN THE ABSENCE OF REGISTRATION UNDER OR
EXEMPTION FROM SUCH ACT AND ALL APPLICABLE STATE SECURITIES LAWS."
"THESE SHARES ARE SUBJECT TO THE TERMS AND PROVISIONS OF A PREFERRED
STOCK AND WARRANT PURCHASE AGREEMENT AND A SHAREHOLDER AGREEMENT,
EACH DATED AS OF FEBRUARY 28, 1997, BETWEEN JOTAN, INC. (THE
"COMPANY"), RICE PARTNERS II, L.P., F-JOTAN, L.L.C., AND F-SOUTHLAND,
L.L.C., FF-SOUTHLAND, L.P. AND THE OTHER PARTIES LISTED ON THE
SIGNATURE PAGES TO SUCH SHAREHOLDER AGREEMENT (AS SUCH AGREEMENTS MAY
BE SUPPLEMENTED, MODIFIED, AMENDED, OR RESTATED FROM TIME TO TIME,
THE "AGREEMENTS"). COPIES OF THE AGREEMENTS ARE AVAILABLE AT THE
EXECUTIVE OFFICES OF THE COMPANY."
COPIES OF THE AGREEMENTS ARE AVAILABLE AT THE OFFICES OF THE
COMPANY."
All shares of Capital Stock of the Company subject to the Shareholder
Agreement will bear a legend to such effect.
2.03 Original Purchase Agreement Provisions Incorporated into this
Agreement. Except as set forth above, all other provisions in Article II
of the Purchase Agreement shall be incorporated herein as if set forth at
length with full application to the Second Supplemental Preferred Shares;
and all such Preferred Shares issued pursuant to this Agreement shall be
included in all adjustment and other calculations under Section 2.08 of
the Purchase Agreement relating to Preferred Shares issued as of the
Original Closing Date under the Original Purchase Agreement as if the
Second Supplemental Preferred Shares were issued on the Original Closing
Date; provided, however, that as a result of the issuance of securities
contemplated by the Second Supplemental Documents, there will be no
adjustments under Section 2.08 of the Original Purchase Agreement (despite
the issuance of the Supplemental Preferred Stock to Rice).
Article III
Representations and Warranties
3.01 Representations and Warranties of the Company and the
Shareholder. The Company and the Shareholder severally and not jointly
represent and warrant to the Southland Purchasers, Purchaser and F-Jotan
that:
(a) Except as disclosed in writing to Rice and the Southland
Purchasers, the Company is a corporation duly organized and existing
and in good standing under the laws of its state of incorporation and
is qualified or licensed to do business in all other countries,
states, and jurisdictions the laws of which require it to be so
qualified or licensed. The Company has no Subsidiaries (other than
Southland) or debt or equity investment in any Person. Giving effect
to the transactions contemplated herein, the Shareholder owns
beneficially and of record the number of shares in the aggregate of
the issued and outstanding capital stock or stock equivalents of the
Company on a fully converted and diluted basis as of the Closing Date
set forth under the signature of such Shareholder on this Agreement,
all being free and clear of all liens, claims and encumbrances.
Other than the Southland Purchasers, Purchaser and F-Jotan, and,
except any other stock issuable under any employee or director stock
plan which constitutes Permitted Stock, no Person has any rights,
whether granted by the Company or any other Person, to acquire any
portion of the equity interest of the Company or the assets of the
Company.
(b) Each of the Company and the Shareholder has, and at all
times that this Agreement is in force will have, the right and power,
and is duly authorized, to enter into, execute, deliver, and perform
this Agreement and the Second Supplemental Shareholder Agreement, and
the officers of Company executing and delivering this Agreement and
the Second Supplemental Shareholder Agreement are duly authorized to
do so. This Agreement has been duly and validly executed, issued,
and delivered and constitutes the legal, valid, and binding
obligations of Company and the Shareholder, enforceable in accordance
with its respective terms.
(c) The execution, delivery, and performance of this Agreement
and the Shareholder Agreement will not, by the lapse of time, the
giving of notice, or otherwise, constitute a violation of any
applicable provision contained in the charter, bylaws, or
organizational documents of the Company or, except for the Senior
Credit Agreement (as defined in the Note Agreement), contained in any
agreement, instrument, or document to which the Company or the
Shareholder is a party or by which any of them is bound.
(d) As of the Closing Date, the authorized capital stock of the
Company consists of (i) 40,000,000 shares of Common Stock, of which
5,679,411 shares are issued and outstanding and (ii) 10,000,000
shares of Preferred Stock, of which 1,435,705 shares of Series A
Preferred Stock are issued and outstanding and of which 64,250 shares
of Series B Preferred Stock are issued and outstanding (after giving
effect to the transactions contemplated herein). An aggregate of at
least 3,620,473 shares of Common Stock are reserved for issuance on
exercise of the First Supplemental Warrant; and notwithstanding
Section 3.01(d) of the Original Purchase Agreement, 15,210,990 shares
of Common Stock have been reserved for issuance of all other Warrants
(issued as of the Original Closing Date of February 28, 1997). All
of the issued and outstanding shares of Common Stock are, and upon
issuance and payment therefor in accordance with the terms of this
Agreement, all of the outstanding Second Supplemental Series B
Preferred Stock will be, validly issued, fully paid and
nonassessable. The Second Supplemental Preferred Shares have been
offered, issued, sold, and delivered by Company free from preemptive
rights, rights of first refusal, antidilution rights, cumulative
voting rights or similar rights (except as otherwise provided in the
Purchase Agreement, this Agreement, the Shareholder Agreement or in
the powers, designations, rights and preferences of the Preferred
Stock contained in the Certificate) and in compliance with applicable
federal and state securities laws. Except pursuant to this Agreement
and the Certificate and except for the Permitted Stock, the Company
is not obligated to issue or sell any Capital Stock, and, except for
this Agreement and the Shareholder Agreement, neither the Company nor
the Shareholder is party to, or otherwise bound by, any agreement
affecting the voting of any Capital Stock. Except for the
Shareholder Agreement, the Company is not, nor will it be, a party
to, or otherwise bound by, any agreement obligating it to register
any of its Capital Stock.
(e) The Second Supplemental Preferred Shares have been duly and
validly authorized and, when issued in accordance with the terms of
this Agreement, will be validly issued, fully paid, and nonassessable
and free of preemptive rights, rights of first refusal or similar
rights.
(f) All other representations and warranties set forth in the
Original Purchase Agreement are true and correct as of the date
hereof, giving effect to the transactions contemplated hereby.
3.02 Representations and Warranties of Purchaser. Rice represents and
warrants to the Company, F-Jotan, the Southland Purchasers and the
Shareholder:
(a) Rice is a limited partnership, duly organized, validly
existing and in good standing under the laws of the jurisdiction of
its organization.
(b) Rice has the right and power and is duly authorized to
enter into, execute, deliver, and perform this Agreement and the
Second Supplemental Shareholder Agreement, and its officers, managers
or agents executing and delivering this Agreement and the Second
Supplemental Shareholder Agreement are duly authorized to do so.
This Agreement and the Second Supplemental Shareholder Agreement have
been duly and validly executed, issued, and delivered and constitute
the legal, valid, and binding obligation of Rice, enforceable in
accordance with their respective terms.
(c) Rice (i) is an "accredited investor," as that term is
defined in Regulation D under the Securities Act; (ii) has such
knowledge, skill and experience in business and financial matters,
based on actual participation, that it is capable of evaluating the
merits and risks of an investment in the Company and the suitability
thereof as an investment for Purchaser; (iii) has received and
reviewed all such financial and other information and records of the
Company as it considered necessary or appropriate in deciding whether
to purchase the Second Supplemental Preferred Shares, and the Company
and the Shareholder have made available to it the opportunity to ask
questions of, and to receive answers and to obtain additional
information from, representatives of the Company and the Shareholder;
(iv) all such additional information has been provided to and
reviewed by it; and (v) it has the ability to bear the economic risks
of losing its entire investment in the Second Supplemental Preferred
Shares.
(d) Except as otherwise contemplated by this Agreement and the
Shareholder Agreement, Rice is acquiring its Second Supplemental
Series B Preferred Stock, for investment for its own account and not
with a view to any distribution thereof in violation of applicable
securities laws.
(e) Rice agrees that the certificates representing its
Preferred Shares will bear the legends referenced in this Agreement
or the Original Purchase Agreement, as the case may be, and such
Preferred Shares, will not be offered, sold, or transferred in the
absence of registration or exemption under applicable securities
laws.
(f) Rice is not acquiring the Second Supplemental Preferred
Shares based upon any representation, oral or written, by the Company
or the Shareholder or any representative of the Company or the
Shareholder with respect to the future value of, income from, or tax
consequences relating to, such Preferred Shares, but rather upon an
independent examination and judgment as to the prospects of the
Company. Further, Rice acknowledges that no federal or state
administrative entity responsible for securities registration or
enforcement has made any recommendation or endorsement of such
Preferred Shares or any findings as to the fairness of an investment
in the Preferred Shares.
(g) Rice has no current contract, undertaking, agreement,
arrangement or understanding with any Person to sell, transfer, grant
any participation in, or otherwise distribute any of, the Second
Supplemental Preferred Shares.
Article IV
Covenants
4.01 Original Purchase Agreement Covenants Incorporated Into This
Agreement. The Company will comply with all covenants in Article IV of
the Original Purchase Agreement as if set forth herein at length.
Article V
Conditions
The obligations of Purchaser to effect the transactions contemplated
by this Agreement are subject to the following conditions precedent:
5.01 Shareholder Agreement. The Company, F-Jotan, the Southland
Purchasers and the Shareholder will have entered into the Second
Supplemental Shareholder Agreement with Purchaser.
5.02 Representations and Agreements. Each representation and
warranty of the Company and the Shareholder set forth in this Agreement
will be true and correct in all material respects when made and as of the
Closing Date, and the Company and the Shareholder will have fully
performed all their covenants and agreements set forth in this Agreement
in all material respects.
5.03 Proceedings; Consents. All proceedings taken in connection with
the transactions contemplated by this Agreement, and all documents
necessary to the consummation of this Agreement, will be satisfactory in
form and substance to Purchaser and its counsel, and Purchaser and its
counsel will have received certificates of compliance and copies (executed
or certified as may be appropriate) of all documents, instruments, and
agreements that Purchaser or its counsel reasonably may request in
connection with the consummation of such transactions. All consents of
any Person necessary to the consummation of the transactions contemplated
by this Agreement and the Second Supplemental Shareholder Agreement will
have been received, be in full force and effect, and not be subject to any
onerous condition.
5.06 Government Filings. All filings under all applicable state and
federal securities laws, rules and regulations shall have been made and
all requirements in connection therewith shall have been met by the
Company, Purchaser and the Shareholder.
Article VI
Miscellaneous
6.01 Indemnification. In addition to any other rights or remedies to
which Purchaser and the Holders may be entitled, the Company and the
Shareholder (solely with respect to the representations and warranties
made by him) severally and not jointly agree to and will indemnify and
hold harmless Purchaser, the Southland Purchasers and F-Jotan, the
Holders, and their Affiliates and their respective successors, assigns,
officers, directors, managers, employees, attorneys, and agents
(individually and collectively, an "Indemnified Party") from and against
any and all losses, claims, obligations, liabilities, deficiencies,
penalties, causes of action, damages, costs, and expenses (including,
without limitation, costs of investigation and defense, attorneys' fees,
and expenses), including, without limitation, those arising out of the
contributory negligence of any Indemnified Party, that the Indemnified
Party may suffer, incur, or be responsible for, arising or resulting from,
to the extent applicable, any misrepresentation, breach of warranty, or
nonfulfillment of any covenant or agreement on the part of the Company or
the Shareholder (solely with respect to the representations and warranties
made by him) under this Agreement, the Shareholder Agreement, or under any
other agreement to which the Company or the Shareholder is a party in
connection with this transaction, or from any misrepresentation in or
omission from any certificate or other instrument furnished or to be
furnished to Purchaser or the Holders under this Agreement.
6.02 Default. It is agreed that a violation by any party of the
terms of this Agreement cannot be adequately measured or compensated in
money damages, and that any breach or threatened breach of this Agreement
by a party to this Agreement would do irreparable injury to the
nondefaulting party. It is, therefore, agreed that in the event of any
breach or threatened breach by a party to this Agreement of the terms and
conditions set forth in this Agreement, the nondefaulting party will be
entitled, in addition to any and all other rights and remedies that it may
have in law or in equity, to apply for and obtain injunctive relief
requiring the defaulting party to be restrained from any such breach or
threatened breach or to refrain from a continuation of any actual breach.
6.03 Integration. The Purchase Agreement, the Other Agreements, the
First Supplemental Warrant (as defined in the First Supplemental Purchase
Agreement) and all other Warrants, and the Shareholder Agreement (as
amended and confirmed as of the date hereof) constitute the entire
agreement between the parties with respect to the subject matter hereof
and thereof and supersede all previous written, and all previous or
contemporaneous oral, negotiations, understandings, arrangements, and
agreements. This Agreement may not be amended or supplemented except by a
writing signed by Company, the Shareholder and each Holder.
6.04 Headings. The headings in this Agreement are for convenience
and reference only and are not part of the substance of this Agreement.
References in this Agreement to Sections and Articles are references to
the Sections and Articles of this Agreement unless otherwise specified.
6.05 Severability. The parties to this Agreement expressly agree
that it is not the intention of any of them to violate any public policy,
statutory or common law rules, regulations, or decisions of any
governmental or regulatory body. If any provision of this Agreement is
judicially or administratively interpreted or construed as being in
violation of any such policy, rule, regulation, or decision, the
provision, section, sentence, word, clause, or combination thereof causing
such violation will be inoperative (and in lieu thereof there will be
inserted such provision, sentence, word, clause, or combination thereof as
may be valid and consistent with the intent of the parties under this
Agreement) and the remainder of this Agreement, as amended, will remain
binding upon the parties, unless the inoperative provision would cause
enforcement of the remainder of this Agreement to be inequitable under the
circumstances.
6.06 Notices. Whenever it is provided herein that any notice,
demand, request, consent, approval, declaration, or other communication be
given to or served upon any of the parties by another, such notice,
demand, request, consent, approval, declaration, or other communication
will be in writing and addressed to the party to be notified as set forth
below. Notices shall be deemed to have been validly served, given or
delivered (and "the date of such notice" or words of similar effect shall
mean the date) five (5) days after deposit in the United States mails,
certified mail, return receipt requested, with proper postage prepaid, or
upon actual receipt thereof with written acknowledgment of receipt
(whether by noncertified mail, telecopy, telegram, facsimile, express
delivery, hand delivery or otherwise), whichever is earlier.
If to Rice, at: Address of Rice beneath the name of Rice on the
signature pages of this Agreement
with courtesy copies to: Xxxxxx Xxxxx, L.L.P.
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxx, Esq.
FAX: 000-000-0000
If to the Southland
Purchasers, at: Address of the Southland Purchasers beneath the
name of the Southland Purchasers on the signature
pages of this Agreement
with courtesy copies to: Wyrick, Robins, Xxxxx & Xxxxxx, L.L.P.
0000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
If to F-Jotan, at: Address of F-Jotan beneath the name of F-Jotan on
the signature pages of this Agreement
with courtesy copies to: Wyrick, Robins, Xxxxx & Xxxxxx, L.L.P.
0000 Xxxx Xxxxx Xxxxx, Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Xxxxx X. Xxxxx, Xx.
Facsimile: (000) 000-0000
If to the Company, at: Jotan, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attn: President
Fax: 000-000-0000
If to the Shareholder, Address of such Shareholder beneath his/her
name on the signature pages of this Agreement
or to such other address as each party may designate for itself by like
notice. Notice to any Holder other than Purchaser will be delivered as
set forth above to the address shown on the stock transfer books of the
Company or the Warrant Register unless such Holder has advised the Company
in writing of a different address to which notices are to be sent under
this Agreement.
Failure or delay in delivering courtesy copies of any notice, demand,
request, consent, approval, declaration, or other communication to the
persons designated above to receive copies of the actual notice will in no
way adversely affect the effectiveness of such notice, demand, request,
consent, approval, declaration, or other communication.
No notice, demand, request, consent, approval, declaration or other
communication will be deemed to have been given or received unless and
until it sets forth all items of information required to be set forth
therein pursuant to the terms of this Agreement.
6.07 Successors. This Agreement will be binding upon and inure to
the benefit of the parties and their respective successors and assigns;
provided, however, that no sale, assignment or other transfer by any party
to this Agreement of any of its Capital Stock or rights hereunder to
another Person will be valid and effective unless and until the transferee
or assignee agrees in writing to be bound by the terms and conditions of
this Agreement and the Shareholders Agreement, and the agreements and
instruments related hereto and thereto, in a form and substance reasonably
satisfactory to the Company.
6.08 Remedies. The failure of any party to enforce any right or
remedy under this Agreement, or promptly to enforce any such right or
remedy, will not constitute a waiver thereof, nor give rise to any
estoppel against such party, nor excuse any other party from its
obligations under this Agreement. Any waiver of any such right or remedy
by any party must be in writing and signed by the party against which such
waiver is sought to be enforced.
6.09 Survival. All warranties, representations, and covenants made
by any party in this Agreement or in any certificate or other instrument
delivered by such party or on its behalf under this Agreement will be
considered to have been relied upon by the party to which it is delivered
and will survive the Closing Date, regardless of any investigation made by
such party or on its behalf. All statements in any such certificate or
other instrument will constitute warranties and representations under this
Agreement.
6.10 Fees. Any and all fees, costs, and expenses, of whatever kind
and nature, including attorneys' fees and expenses, incurred by the
Holders in connection with the defense or prosecution of any actions or
proceedings arising out of or in connection with this Agreement will be
borne and paid by the Company within ten (10) days of demand by the
Holders.
6.11 Counterparts. This Agreement may be executed in any number of
counterparts, which will individually and collectively constitute one
agreement.
6.12 Other Business. It is understood and accepted that Purchaser,
F-Jotan, the Southland Purchasers, the Holders, and their Affiliates have
interests in other business ventures that may be in conflict with the
activities of the Company and that nothing in this Agreement will limit
the current or future business activities of such parties whether or not
such activities are competitive with those of the Company. The Company
and the Shareholder agree that all business opportunities that may be
available to such parties in any field substantially related to the
business of the Company will be pursued exclusively through the Company.
6.13 Choice of Law. THIS AGREEMENT WILL BE INTERPRETED AND THE
RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE UNITED
STATES APPLICABLE THERETO AND THE INTERNAL LAWS OF THE STATE OF FLORIDA
APPLICABLE TO AN AGREEMENT EXECUTED, DELIVERED AND PERFORMED THEREIN
WITHOUT GIVING EFFECT TO THE CHOICE-OF-LAW RULES THEREOF OR ANY OTHER
PRINCIPLE THAT COULD REQUIRE THE APPLICATION OF THE SUBSTANTIVE LAW OF ANY
OTHER JURISDICTION.
6.14 Duties Among Holders. Each Holder agrees that no other Holder
will by virtue of this Agreement be under any fiduciary or other duty to
give or withhold any consent or approval under this Agreement or to take
any other action or omit to take any action under this Agreement, and that
each other Holder may act or refrain from acting under this Agreement as
such other Holder may, in its discretion, elect.
6.15 Waiver of Jury Trial. AFTER REVIEWING THIS SECTION 6.15 WITH
ITS COUNSEL, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE
COMPANY, F-JOTAN, PURCHASER, THE SOUTHLAND PURCHASERS AND EACH SHAREHOLDER
HEREBY KNOWINGLY, INTELLIGENTLY AND INTENTIONALLY, IRREVOCABLY AND
EXPRESSLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENTS ENTERED INTO IN
CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR
THE ACTIONS OF THE COMPANY, F-JOTAN, PURCHASER, THE SOUTHLAND PURCHASERS
AND EACH SHAREHOLDER IN THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT
HEREOF OR THEREOF. THIS PROVISION IS A MATERIAL INDUCEMENT FOR PURCHASER
TO PURCHASE THE WARRANTS AND PREFERRED STOCK FROM THE COMPANY.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first above written.
COMPANY:
JOTAN, INC.
BY: /s/ Xxxxxx Xxxxxxxx
Xxxxxx Xxxxxxxx
Vice President and Chief Financial
Officer
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Attn: President
Fax: (000) 000-0000
RICE:
RICE PARTNERS II, L.P.
By: Rice Capital Group IV, L.P.,
Its general partner
By: RMC Fund Management, L.P.,
Its general partner
By: Rice Mezzanine Corporation,
Its general partner
By: /s/ Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
Managing Director
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx
Fax: (000) 000-0000
OWNED ON CLOSING DATE:
None Shares of Series A
Convertible Preferred Stock
40,000 Shares of Series B Preferred
Stock
13,125 Shares of First
Supplemental Series B
Preferred Stock
1,125 Shares of Second
Supplemental Series B
Preferred Stock
None Shares of Common Stock
2,515,203 Warrant A-1 Shares
9,581,726 Warrant A-2 Shares
3,620,473 First Supplemental Warrant
A-2 Shares
F-JOTAN, L.L.C.
By: Franklin Street/Fairview Capital,
L.L.C., its Manager
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx,
Manager
000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
OWNED ON CLOSING DATE:
1,435,705 Shares of Series A
Convertible Preferred Stock
None Shares of Common Stock
None Other Equity Interests
THE SOUTHLAND PURCHASERS:
F-SOUTHLAND, L.L.C.
By: Franklin Street/Fairview Capital,
L.L.C., its Manager
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx, Manager
000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
OWNED ON CLOSING DATE:
None Shares of Series A
Convertible Preferred Stock
5,000 Shares of Series B
Preferred Stock
None Shares of Common Stock
359,315 Warrant B-1 Shares
1,197,716 Warrant B-2 Shares
FF-SOUTHLAND, L.P.
By: FSFC Associates, L.P.,
Its general partner
By: Franklin Capital, L.L.C.,
Its general partner
By: /s/ Xxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxx,
Manager
000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
OWNED ON CLOSING DATE:
None Shares of Series A
Convertible Preferred Stock
5,000 Shares of Series B
Preferred Stock
None Shares of Common Stock
359,315 Warrant C-1 Shares
1,197,716 Warrant C-2 Shares
SHAREHOLDER:
/s/ Shea E. Xxxxx
Xxxx X. Xxxxx
OWNED ON CLOSING DATE:
950,000 Shares of Common Stock Owned
on Closing Date
33,000 Other Equity Interests
ANNEX A
[Second Supplemental Shareholder Agreement]
SECOND SUPPLEMENTAL PREFERRED STOCK
PURCHASE AGREEMENT
Jotan, Inc.
the "Company"
the Shareholders as set forth on the signature pages hereof
the "Shareholder"
and
Rice Partners II, L.P. (the "Purchaser"),
and
F-Southland, L.L.C. and FF-Southland, L.P.
F-Jotan
January 23, 1998