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EXHIBIT 10.9
1995 STOCK PURCHASE AGREEMENT
BETWEEN
VIAGRAFIX CORPORATION, PURCHASER
AND
GEOCAPITAL III, L.P. SHAREHOLDER OF
AMERICAN SMALL BUSINESS COMPUTERS, INC.
THIS AGREEMENT, made and entered into at Pryor, Oklahoma, effective
this 15th day of August, 1995, by and between VIAGRAFIX CORPORATION, an
Oklahoma corporation, hereinafter referred to as ViaGrafix or Purchaser, first
party, and GEOCAPITAL III, L.P. hereinafter referred to as GeoCapital or Seller
or Shareholder, second party, Selling Party;
WITNESSETH:
1 ASSETS TO BE SOLD AND PURCHASED.
1.1 Capital Stock: Shareholder GeoCapital represents that it is a
shareholder of AMERICAN SMALL BUSINESS COMPUTERS, INC., an Oklahoma
Corporation, hereinafter referred to as ASBC or the Company, and is the owner
and holder of 1,078 shares (the Shares) of the fully paid and non assessable
stock of ASBC, which are free and clear of any liens security interests or
encumbrances.
1.2 Subject to the terms and conditions set forth in this
agreement, on the closing date, Shareholder will transfer and convey the Shares
to the Buyer, and Buyer will acquire and purchase the Shares from the
Shareholder.
2 CONSIDERATION FOR PURCHASE.
2.1 Total consideration for the purchase and sale of the stock
shall be:
ASBC 1078 shares Capital Stock, ONE MILLION FIVE HUNDRED THOUSAND
DOLLARS ($1,500,000.00).
payable in the following manner:
2.1.1 The sum of NINETY SEVEN THOUSAND EIGHT HUNDRED TWENTY
SIX & 09/100 DOLLARS ($97,826.09) shall be paid by Buyer to
Seller on the closing date.
2.1.2 The balance of $1,402,173,91 shall be paid by Buyer's
Promissory Note to Seller with interest at 7.5% per annum,
payable in monthly installments over the next 5 years.
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The parties acknowledge that the Corporation is creating indebtedness at this
time to Xxxxxx Xxxxxxx in a related transaction; payments under the Xxxxxxx
Note, and the Note provided for by this agreement shall be due on the same
date, and ViaGrafix shall treat both GeoCapital and Xxxxxxx notes as equal in
priority, and in making payments on same shall not discriminate in favor of
either of the holders of said notes.
2.2 As an express condition of this purchase, upon Buyer acquiring
all of the issued and outstanding capital stock of ASBC, the Seller agrees to
make an election under Internal Revenue Code Section 338(h)(10) and subject to
the following:
2.2.1 Seller and Buyer agree that they will elect to treat
the sale of the shares pursuant to this Agreement as a deemed
taxable sale of all of the assets of ASBC pursuant to Section
338 (h) (10) of the Code (the "Election"). Seller and Buyer
agree to take or cause to be taken all actions necessary to
file, on a timely basis, the election prescribed pursuant to
Treasury Regulation Section 1.338(h)(10)- 1, and that they
will take all steps necessary to obtain comparable treatment,
where applicable, under state or local law. Seller and Buyer
further agree that they will not take, or cause to be taken,
any action in connection with the filing of any Return of ASBC
which would be inconsistent with or prejudice the Election,
and shall not make any inconsistent written or oral statements
during the course of any Taxing Authority audit.
3 CLOSING DATE
3.1 Closing date of this transaction shall be August 15, 1995.
4 REPRESENTATIONS AND WARRANTIES OF SELLERS
GeoCapital warrants and represents:
4.1 That it is the owner of the Shares transferred, and since
acquiring said shares, there are no liens or encumbrances thereon.
4.2 That it this transfer is duly authorized by the Limited
Partnership, and such stock assignments, when issued, shall be valid and
binding upon the Seller.
5 REPRESENTATIONS OF BUYER
5.1 Buyer represents that this transaction, and all notes, security
interests, mortgages, contracts, and other documents executed in connection
herewith have been duly and properly authorized by corporate action of the
Buyer, and such instruments and documents when duly executed and delivered
shall be valid obligations of the Buyer, ViaGrafix Corporation.
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6 SECURITIES REGISTRATION
Each of the parties acknowledge and represent that the stock exchanged
under this agreement is not registered under the Security Act of 1933, or the
Oklahoma Securities Act, and have been acquired by each of the parties with a
view to investment. Each of the parties are knowledgeable and experienced in
making of venture capital investments, and is able to bear the economic risk of
loss of its investment in the respective companies, and have been granted the
opportunity to make a thorough investigation of the affairs of the Company and
has availed itself of such opportunity to the extent deemed necessary. That
each of the parties are "accredited investors" as defined in Rule 501 of
Regulation D under the Securities Act.
7 BINDING UPON HEIRS AND ASSIGNS.
7.1 This agreement shall be binding upon the parties, and their
heirs, executors, personal representatives, trustees, successors, and assigns,
and the terms hereof shall survive the closing.
IN WITNESS WHEREOF, the parties have caused this agreement to be
executed in duplicate originals at Pryor, Oklahoma, on this 15th day of August,
1995.
Buyer: Seller:
ViaGrafix Corporation GeoCapital III, L.P.
By: GeoCapital Management, L.P.
/s/ XXXX XXXXXXX /s/ XXXXXXXX X. XXXXXX
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Xxxx Xxxxxxx, President Xxxxx Xxxxxx, General Partner
The undersigned shareholders of ViaGrafix Corporation, do hereby ratify and
approve the foregoing agreement, this 15th day of August, 1995.
GeoCapital III, L.P.
By: Geocapital Management, L.P.
By:
/s/ XXXXXXXX X. XXXXXX
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Xxxxx Xxxxxx General Partner
/s/ XXXXXX XXXXXXX
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Xxxxxx Xxxxxxx
/s/ XXXX XXXXXXX
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Xxxx Xxxxxxx
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PROMISSORY NOTE
$1,402,173.91 Pryor, Oklahoma
Date: August 15, 1995
FOR VALUE RECEIVED, VIAGRAFIX CORPORATION, an Oklahoma corporation, the
undersigned (jointly and severally if more than one) do hereby promise to pay to
the order of GEOCAPITAL III, L.P. the principal sum of ONE MILLION FOUR HUNDRED
TWO THOUSAND ONE HUNDRED SEVENTY THREE & 91/100 DOLLARS ($1,402,173.91) plus
interest thereon from date to maturity or default at the ANNUAL PERCENTAGE RATE
of SEVEN AND ONE HALF (7.5%) per annum, until paid, interest to be compounded
monthly and to become principal if not paid when due.
Such indebtedness shall be payable at the residence or place of business
of the holder which shall be designated from time to time, and shall be paid
in 60 consecutive monthly payments of TWENTY EIGHT THOUSAND NINETY SIX & 69/100
DOLLARS ($28,096.69) per month, beginning on or before the 15th day of
September, 1995, and on the same date each month thereafter, except that the
entire balance of principal and interest shall be payable in full on or before
the 15th day of August, 2000, if not sooner paid.
The maker hereof may prepay in whole or in part, any part of the principal
sum due hereunder, at any time, without penalty, with interest calculated to
the date of payment only.
The makers and endorsers of this severally waive demand, protest, and
notice of demand, protest and nonpayment. The maker agrees to pay the holder a
"late charge" of $10 for any payment which is delinquent more than ten (10)
days from the due date.
In the event of any default in the terms of this note results in the
placing of this note in the hands of an attorney for collection, the makers and
endorsers agree to pay a reasonable attorney fee, and all costs of collection.
A waiver of any breach of this note shall not be constituted to be a waiver of
any subsequent breach.
Attest: ViaGrafix Corporation
(corp seal)
By: /s/ XXXXXX XXXXXXX /s/ XXXX XXXXXXX
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Xxxxxx Xxxxxxx, Secretary Xxxx Xxxxxxx, President
