EXHIBIT 10.1
L.P. AND OPTION PURCHASE AND TERMINATION AGREEMENT
AGREEMENT, dated as of August 20, 1999 (the "Agreement"), among
Xxxxxxxx Convertibles, Inc., a Delaware corporation ("Xxxxxxxx"), Xxxxxxxx
Chicago Ltd. ("Sub"), an Illinois corporation and a wholly-owned subsidiary of
Xxxxxxxx, Xxxxx Partners, LP, a limited partnership ("LP Owner"), which is the
sole limited partner of Xxxxxxxx Chicago, L.P., a Delaware limited partnership
("LP"), JCI Consultant, LP ("Consultant"), a limited partnership which owns
certain options to purchase capital stock of Xxxxxxxx, Xxxxx Xxxxx, a principal
of LP Owner and Consultant, Xxx Xxxxx (collectively with Xxxxx Xxxxx, "Xxxxx"),
Xxxx Enterprises, Inc., a New York corporation ("Xxxx"), Xxxx Xxxx ("Love"), the
owner of Xxxx and, Xxxxxx X. Xxxxxxxxxx ("Xxxxxxxxxx") and Xxxxxx X. Xxxxxxx
("Xxxxxxx"), each of whom is a principal stockholder, an officer and a director
of Xxxxxxxx.
WHEREAS, LP Owner is the sole limited partner of LP;
WHEREAS, pursuant to a Limited Put Agreement, dated as of March 21,
1991 (the "Put Agreement") LP Owner has the right, under certain circumstances,
to put the interest to Xxxx;
WHEREAS, pursuant to a Stock Option Agreement, dated as of March 21,
1991, as amended by an amendment dated February 25, 1992 (as amended, the
"Option Agreement"), Consultant has an option (the "Option") to purchase up to
1,200,000 shares of Jennifer's common stock, par value $.01 per share;
WHEREAS, in connection with the Option, Consultant entered into (a) a
Voting Trust Agreement with Greenfield and Xxxxxxxx, dated as of March 21, 1991,
as amended by a letter amendment dated February 25, 1992 (as amended, the
"Voting Trust Agreement"), and (b) a Registration and Sales Agreement with
Greenfield, Love, Xxxxxxx and Xxxx, dated as of March 21, 1991, as amended by an
amendment dated February 25, 1992 (as amended, the "Registration Agreement");
WHEREAS, the parties desire to terminate the Voting Trust, the
Registration Agreement, the Put Agreement and all other agreements between them
relating to the Option, the Consulting Agreement, or the LP (collectively, the
"Agreements");
WHEREAS, LP Owner desires to sell, assign and transfer all its right,
title and interest in, to and under the Interest in LP to the Sub;
WHEREAS, the parties desire to enter into certain cross releases (the
"Releases").
NOW THEREFORE, in consideration of the premises and of the
representations, warranties, covenants and agreements set forth herein, the
parties hereto hereby agree as follows:
THE TRANSACTION
Section 1.1 TRANSFER OF INTEREST, TERMINATION OF OPTION AND OTHER
AGREEMENTS. In exchange for $252,000, payable to Consultant on September 1,
1999, and a note in the principal amount of $447,000 (the "Note") payable to LP
Owner and other good and valuable consideration, receipt of which is hereby
acknowledged, (i) LP Owner hereby sells, assigns and transfers to Sub all of its
right, title and interest in, to and under the Interest; (ii) Consultant hereby
agrees that the Option is hereby terminated and shall be of no further force or
effect, and (iii) the parties hereto hereby agree that the Agreements to which
they are a party are hereby terminated and shall be of no further force or
effect.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF XXXXXXXX AND SUB
Xxxxxxxx and Sub, jointly and severally, represent and warrant to LP
Owner, Zises Consultant, Xxxx, Love, Greenfield and Xxxxxxx as follows:
Section 2.1 EXISTENCE, GOOD STANDING, CORPORATE AUTHORITY. Each of
Xxxxxxxx and Sub is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation. Each of Xxxxxxxx
and Sub is duly licensed or qualified to do business as a foreign corporation
and is in good standing under the laws of any other state of the United States
in which the character of the properties owned or leased by it or in which the
transaction of its business makes such qualification necessary.
Section 2.2 AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. Each of
Xxxxxxxx and Sub has the requisite corporate power and authority to execute and
deliver this Agreement, the Releases and the Note. The execution and delivery of
this Agreement, the Releases and the Note, and the consummation by Xxxxxxxx and
Sub of the transactions contemplated hereby and thereby has been duly authorized
by all requisite corporate action. This Agreement constitutes the valid and
legally binding obligation of Xxxxxxxx and Sub and the Releases and the Note
constitute the valid and legally binding obligations of Xxxxxxxx, in each case
enforceable against Xxxxxxxx and (as to this Agreement) Sub, in accordance with
their respective terms, subject to applicable bankruptcy, insolvency, moratorium
or other similar laws relating to creditors' rights and general principles of
equity.
Section 2.3 NO VIOLATION. Neither the execution and delivery by
Xxxxxxxx or Sub, of this Agreement or the Releases, nor the consummation by any
of them of the transactions contemplated hereby or thereby in accordance with
the terms hereof or thereof, will (a) conflict with or result in a breach of any
provisions of their respective Certificate of Incorporation or Bylaws; (b)
violate, conflict with, result in a breach of any provision of, constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) under, result in the termination, or in a right of
termination or cancellation of, accelerate the performance required by, result
in the triggering of any payment or other material obligations pursuant to,
result in the creation of any lien, security interest, charge or encumbrance
upon any of the material properties of Xxxxxxxx or Sub under, or result in being
declared void, voidable, or without further binding effect, any of the terms,
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conditions or provisions of any note, bond, mortgage, indenture, deed of trust
or any material license, franchise, permit, lease, contract, agreement or other
instrument, commitment or obligation to which any of them is a party, or by
which any of them or their properties is bound or affected; (c) contravene or
conflict with or constitute a violation of any provisions of any law,
regulation, judgment, injunction, order or decree binding upon or applicable to
any of them; or (d) require any consent, approval or authorization of, or
declaration, of or registration with, any domestic governmental or regulatory
authority.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF LP OWNER, CONSULTANTS AND XXXXX
XX Owner, Consultant and Zises, jointly and severally, hereby represent
to Xxxxxxxx, Sub, Jara, Greenfield, Love and Xxxxxxx as follows:
Section 3.1 AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. Each of
LP Owner, Consultant and Zises has the requisite power and authority to execute
and deliver this Agreement, the Releases and all agreements and documents to be
executed and delivered in connection herewith. The execution and delivery of
this Agreement and the Releases (and the agreements contemplated hereby) and the
consummation by LP Owner, Consultant and Zises of the transactions contemplated
hereby have been duly authorized by all requisite corporate action. Each of this
Agreement and the Releases has been duly executed by LP Owner, Consultant and
Zises. Each of this Agreement and the Releases (and each of such other
agreements) constitutes the valid and legally binding obligations of LP Owner,
Consultant and Zises, enforceable against them in accordance with their
respective terms, subject to applicable bankruptcy, insolvency, moratorium or
other similar laws relating to creditors' rights and general principles of
equity.
Section 3.2 NO VIOLATION. Neither the execution and delivery by LP
Owner, Consultants and Zises of this Agreement or the Releases, nor the
consummation by any of them of the transactions contemplated hereby or thereby
in accordance with the terms hereof or thereof, will (a) conflict with or result
in a breach of any provisions of the agreement of limited partnership,
Certificate of Incorporation or Bylaws of LP Owner or Consultant or their
respective general partners; (b) violate, conflict with, result in a breach of
any provision of, constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, result in the termination,
or in a right of termination or cancellation of, accelerate the performance
required by, result in the triggering of any payment or other material
obligations pursuant to, result in the creation of any lien, security interest,
charge or encumbrance upon any of the material properties of LP Owner,
Consultant or Zises under, or result in being declared void, voidable, or
without further binding effect, any of the terms, conditions or provisions of
any note, bond, mortgage, indenture, deed of trust or any material license,
franchise, permit, lease, contract, agreement or other instrument, commitment or
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obligation to which any of them is a party, or by which any of them or their
properties is bound or affected; (c) contravene or conflict with or constitute a
violation of any provisions of any law, regulation, judgment, injunction, order
or decree binding upon or applicable to any of them; or (d) require any consent,
approval or authorization of, or declaration, of or registration with, any
domestic governmental or regulatory authority.
Section 3.3 THE INTEREST. The Interest in LP represents all of the
outstanding limited partnership interests in LP and is free and clear of any
liens, claims, encumbrances, options, security interests or other limitations or
restrictions. Xxxxxxxx Investment Chicago Limited Partnership has no interest in
LP.
Section 3.4 THE OPTION. The Option is free and clear of any liens,
claims, encumbrances, options, security interests or other limitations or
restrictions.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF XXXX AND LOVE
Xxxx and Love, jointly and severally, hereby represent to Xxxxxxxx,
Sub, Consultant, LP Owner, Zises, Xxxxxxx and Xxxxxxxxxx as follows:
Section 4.1 AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. Xxxx has
the requisite corporate power and authority to execute and deliver this
Agreement, the Releases and all agreements and documents to be executed and
delivered in connection herewith. The execution and delivery of this Agreement,
the Releases (and the agreements contemplated hereby) and the consummation by
Xxxx of the transactions contemplated hereby has been duly authorized by all
requisite corporate action. Each of this Agreement and the Releases has been
duly executed by Xxxx and Love. Each of this Agreement and the Releases
constitutes the valid and legally binding obligations of Xxxx and Love,
enforceable against them in accordance with their respective terms, subject to
applicable bankruptcy, insolvency, moratorium or other similar laws relating to
creditors' rights and general principles of equity.
Section 4.2 NO VIOLATION. Neither the execution and delivery by Xxxx
and Love of this Agreement or the Releases, nor the consummation by them of the
transactions contemplated hereby or thereby in accordance with the terms hereof
or thereof, will (a) conflict with or result in a breach of any provisions of
the Certificate of Incorporation or Bylaws of Xxxx; (b) violate, conflict with,
result in a breach of any provision of, constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default) under, result
in the termination, or in a right of termination or cancellation of, accelerate
the performance required by, result in the triggering of any payment or other
material obligations pursuant to, result in the creation of any lien, security
interest, charge or encumbrance upon any of the material properties of Xxxx or
Love under, or result in being declared void, voidable, or without further
binding effect, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, deed of trust or any material license, franchise, permit,
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lease, contract, agreement or other instrument, commitment or obligation to
which any of them is a party, or by which either of them or their properties is
bound or affected; (c) contravene or conflict with or constitute a violation of
any provisions of any law, regulation, judgment, injunction, order or decree
binding upon or applicable to Xxxx or Love; or (d) require any consent, approval
or authorization of, or declaration, of or registration with, any domestic
governmental or regulatory authority.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF GREENFIELD AND LOVE
Greenfield and Xxxxxxx, jointly and severally, hereby represent to
Xxxxxxxx, Sub, Consultant, LP Owner, Xxxxx, Xxxx and Love as follows:
Section 4.1 AUTHORIZATION, VALIDITY AND EFFECT OF AGREEMENTS. Each of
this Agreement and the Releases has been duly executed by Greenfield and
Xxxxxxx. Each of this Agreement and the Releases constitutes the valid and
legally binding obligations of Greenfield and Xxxxxxx, enforceable against them
in accordance with their respective terms, subject to applicable bankruptcy,
insolvency, moratorium or other similar laws relating to creditors' rights and
general principles of equity.
Section 4.2 NO VIOLATION. Neither the execution and delivery by
Greenfield and Xxxxxxx of this Agreement or the Releases, nor the consummation
by them of the transactions contemplated hereby or thereby in accordance with
the terms hereof or thereof, will (a) violate, conflict with, result in a breach
of any provision of, constitute a default (or an event which, with notice or
lapse of time or both, would constitute a default) under, result in the
termination, or in a right of termination or cancellation of, accelerate the
performance required by, result in the triggering of any payment or other
material obligations pursuant to, result in the creation of any lien, security
interest, charge or encumbrance upon any of the material properties of
Greenfield or Xxxxxxx under, or result in being declared void, voidable, or
without further binding effect, any of the terms, conditions or provisions of
any note, bond, mortgage, indenture, deed of trust or any material license,
franchise, permit, lease, contract, agreement or other instrument, commitment or
obligation to which any of them is a party, or by which either of them or their
properties is bound or affected; (b) contravene or conflict with or constitute a
violation of any provisions of any law, regulation, judgment, injunction, order
or decree binding upon or applicable to Greenfield or Xxxxxxx; or (c) require
any consent, approval or authorization of, or declaration, of or registration
with, any domestic governmental or regulatory authority.
ARTICLE VI
COVENANTS
Section 6.1 OTHER ACTION.
Subject to the terms and conditions herein provided, the parties shall
use all reasonable efforts to take, or cause to be taken, all action and do, or
cause to be done, all things necessary, proper or appropriate to consummate and
make effective the transactions contemplated by this Agreement and the Releases.
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If, at any time after the closing of the transactions contemplated hereby, any
further reasonable action is necessary or desirable to carry out the purpose of
this Agreement or the Releases, the parties shall take all such necessary
action. Each party hereto shall perform such further acts and execute such
documents as may be reasonably required to effect the transactions contemplated
hereby.
Section 6.2 EXPENSES. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall, except as
otherwise provided herein, be paid by the party which incurs them.
Section 6.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Notwithstanding
any right of a party to investigate the accuracy of the representations and
warranties and notwithstanding any knowledge of facts determined or determinable
by such party pursuant to such investigation or right of investigation, such
party has the right to rely fully upon the representations, warranties,
covenants and agreement of the other parties contained in this Agreement. All
such representations, warranties, covenants and agreements shall survive the
execution and delivery hereof and the closing hereunder.
Section 6.4 STANDSTILL. From and after the date hereof, until December
31, 2010, Xxxxx Xxxxx and Xxx Xxxxx shall not acquire, and shall cause their
immediate family members and their affiliates not to acquire, any beneficial
interest in the common stock of Xxxxxxxx.
ARTICLE VII
INDEMNIFICATION
Section 7.1 OBLIGATION OF CONSULTANT, LP OWNER AND ZISES TO INDEMNIFY.
Consultant, LP Owner and Zises shall, jointly and severally, indemnify, defend
and hold harmless each of the other parties hereto and their respective assigns
from and against Losses arising out of or due to a breach of any representation,
warranty, covenant or agreement of Consultant, LP Owner and Zises contained in
this Agreement or the Releases. In addition, Consultant, LP Owner and Zises
hereby, jointly and severally, indemnify, defend and hold harmless each of the
other parties hereto and the Releasees (as defined in the Release given by
Consultant, LP Owner and Zises), against any claims made by any relative,
associate or affiliate of any of them (including without limitation Xxxxx X.
Xxxxx and Xxxxxxxx Chicago Investment Limited Partnership) against the Releasees
as to any subject matter as to which such Release constitutes a release by
Consultant, Owner or Zises.
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Section 7.2 OBLIGATION OF XXXXXXXX TO INDEMNIFY. Xxxxxxxx shall
indemnify, defend and hold harmless Consultant, LP Owner and Zises from and
against any Losses arising out of or due to a breach of any representation,
warranty, covenant or agreement of Xxxxxxxx or Sub contained in this Agreement,
the Note or the Releases.
Section 7.3 OBLIGATION OF XXXX, LOVE, GREENFIELD AND XXXXXXX TO
INDEMNIFY. Xxxx, Love, Greenfield and Xxxxxxx shall indemnify, defend and hold
harmless each of the other parties hereto and their respective assigns from and
against Losses arising out of or due to a breach of any representation,
warranty, covenant or agreement of such party contained in this Agreement or the
Releases.
Section 7.4 NOTICE AND OPPORTUNITY TO DEFEND. If any party (the
"Indemnitee") receives notice of any claim or the commencement of any action or
proceeding with respect to which any other party (or parties ) is obligated to
provide indemnification (the "Indemnifying Party"), the Indemnitee shall
promptly give the Indemnifying Party notice thereof; PROVIDED, HOWEVER, that
failure to give such notification shall not affect the indemnification provided
hereunder except to the extent the Indemnifying Party shall have been actually
and materially prejudiced as a result of such failure. The Indemnified Party
shall have the right to retain counsel of its own choice to represent it, and
the Indemnifying Party shall pay the fees, expenses and disbursements of such
counsel; and such counsel shall, to the extent consistent with its professional
responsibilities, cooperate with the Indemnifying Party and any counsel
designated by the Indemnifying Party. The Indemnifying Party shall be liable for
any settlement of any claim against the Indemnified Party made with the
Indemnifying Party's written consent, which consent shall not be unreasonably
withheld. The Indemnifying Party shall not, without the prior written consent of
the Indemnified Party, settle or compromise any claim, or permit a default or
consent to the entry of any judgment in respect thereof, unless such settlement,
compromise or consent includes, as an unconditional term thereof, the giving by
the claimant to the Indemnified Party of an unconditional release from all
liability in respect of such claim.
ARTICLE VIII
GENERAL PROVISIONS
Section 8.1 NOTICES. Any notice required to be given hereunder shall be
sufficient if in writing, and sent by facsimile transmission or by courier
service (with proof of service), hand delivery or certified or registered mail
(return receipt requested and first-class postage prepaid), addressed as
follows:
If to Xxxxxxxx, Sub, If to Consultant, LP Owner If to Xxxx or Love:
Greenfield or Xxxxxxx: or Zises:
Xxxxxxxx Convertibles, Inc.
000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxxxx,
President
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With copies to: With copies to:
Squadron, Ellenoff, Plesent,
& Xxxxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attn: Xxxxxxx X. Xxxx
or to such other address as any party shall specify by written notice so given,
and such notice shall be deemed to have been delivered as of the date so
telecommunicated, personally delivered or mailed.
Section 8.2 ASSIGNMENT, BINDING EFFECT. Neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any of
the parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties. Subject to the preceding sentence, this
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective permitted successors and assigns.
Section 8.3 ENTIRE AGREEMENT. This Agreement and any documents
delivered by the parties in connection herewith constitute the entire agreement
among the parties with respect to the subject matter hereof and supersede all
prior agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement shall be binding
upon any party hereto unless made in writing and signed by all parties hereto.
Section 8.4 AMENDMENT. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
Section 8.5 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
its rules of conflict of laws.
Section 8.6 COUNTERPARTS. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute one
and the same instrument.
Section 8.7 HEADINGS. Headings of the Articles and Sections of this
Agreement are for the convenience of the parties only and shall be given no
substantive or interpretive effect whatsoever.
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Section 8.8 INTERPRETATION. In this Agreement, unless the context
otherwise requires, words describing the singular number shall include the
plural and vice versa, and words denoting any gender shall include all genders
and words denoting natural persons shall include corporations and partnerships
and vice versa.
Section 8.9 WAIVERS. Except as provided in this Agreement, no action
taken pursuant to this Agreement, including, without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representations,
warranties, covenants or agreements contained in this Agreement. The waiver by
any party hereto of a breach of any provision hereunder shall not operate or be
construed as a waiver of any prior or subsequent breach of the same or any other
provision hereunder.
Section 8.10 SEVERABILITY. Any term or provision of this Agreement
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
Section 8.11 ENFORCEMENT OF AGREEMENT. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that the parties shall be entitled
to seek an injunction or injunctions to prevent breaches of this Agreement and
to enforce specifically the terms and provisions hereof, this being in addition
to any other remedy to which they are entitled at law or in equity.
IN WITNESS WHEREOF, the parties have executed this Agreement and caused
the same to be duly delivered on their behalf on the day and year first written
above.
XXXXXXXX CONVERTIBLES, INC.
By: /s/ XXXXXX X. XXXXXXXXXX
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
XXXXXXXX CHICAGO, LTD.
By: /s/ XXXXXX X. XXXXXXXXXX
-----------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
JCI CONSULTANT LP
By: JCI CONSULTANT CORP.
(Its General Partner)
By: /s/ XXXXX XXXXX
-----------------------------------
Name: Xxxxx Xxxxx
Title: Presdent
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XXXXX PARTNERS, L.P.
By: M.P. (XXXXX) PARTNERS, L.P.
(Its General Partner)
By: XXXXX ACQUISITION CORP.
(Its General Partner)
By: /s/ XXXXX XXXXX
-----------------------------------
Name: Xxxxx Xxxxx,
Title: President
/s/ XXXXX XXXXX
-----------------------------------
Xxxxx Xxxxx
/s/ XXX XXXXX
-----------------------------------
Xxx Xxxxx
/s/ XXXXXX X. XXXXXXXXXX
-----------------------------------
Xxxxxx X. Xxxxxxxxxx
/s/ XXXXXX X. XXXXXXX
-----------------------------------
Xxxxxx X. Xxxxxxx
/s/ XXXX X. LOVE
-----------------------------------
Xxxx X. Love
XXXX ENTERPRISES, INC.
By: /s/ XXXX X. LOVE
-----------------------------------
Xxxx X. Love, President
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