STOCK PURCHASE AGREEMENT
This Agreement dated as of January 8, 1999 is by and between ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, ▇▇. ("Seller"), and HIGH RIVER LIMITED PARTNERSHIP, a Delaware
limited partnership ("Purchaser").
WHEREAS, Seller is the owner of 1,554,921 shares of Common Stock, $.01 par
value per share ("Panaco Common Stock"), of Panaco, Inc., a Delaware corporation
("Panaco");
WHEREAS, Seller desires to sell 1,554,921 shares of Panaco Common Stock
(the "Panaco Shares") to Purchaser and Purchaser desires to purchase the Panaco
Shares from Seller, subject to the provisions contained herein;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, and intending to be legally bound by the terms and
conditions of this Agreement, the parties hereto hereby agree as follows:
1. SALE OF PANACO SHARES TO PURCHASER.
1.1. SALE AND PURCHASE OF PANACO SHARES. Subject to the terms
and conditions of this Agreement, at the Closing, Seller shall sell, transfer,
assign, convey and deliver to Purchaser and Purchaser shall purchase, accept and
acquire from Seller, the Panaco Shares, in consideration of the payment by
Purchaser to Seller of an aggregate purchase price of $1,554,921.00 (the
"Purchase Price"), payable as set forth in Section 2 of this Agreement.
2. THE CLOSING.
2.1. THE CLOSING. The closing of the transactions contemplated
by this Agreement (the "Closing") shall take place at the offices of ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ P.C., Houston, Texas, at 10:00 a.m. on January 8, 1999 (the
"Closing Date"), or at such other time, date, and place as are mutually
agreeable to Seller and Purchaser. At the Closing, (A) Seller will deliver to
Purchaser the certificates representing the Panaco Shares accompanied by stock
transfer powers duly endorsed in blank and (B) Purchaser shall make payment of
the Purchase Price to Seller. The Purchase Price shall be paid by Purchaser to
Seller by wire transfer.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. In connection with the
purchase of the Panaco Shares, Seller hereby represents and warrants to
Purchaser as follows:
3.1. TITLE TO PANACO SHARES. Seller has good legal title to
the Panaco Shares, and has the full legal right, power and authority to sell,
assign and transfer complete ownership in the Panaco Shares to Purchaser, free
and clear of all liens, claims, restrictions, encumbrances, charges, options or
rights of third parties with respect thereto. The Panaco Shares are all of the
shares of Panaco Common Stock owned by Seller.
3.2 COMMUNITY PROPERTY. Seller (i) is not married on the date
hereof, (ii) was not married when he acquired the Panaco Shares and (iii) was
not married at any time between the date he acquired the Panaco Shares and the
date hereof.
3.3 BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon any arrangement
made by or on behalf of Seller.
4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser represents and warrants to Seller as follows:
4.1 AUTHORITY, ETC. Purchaser has the legal capacity to enter
into and perform this Agreement. This Agreement constitutes the valid and
binding obligation of Purchaser enforceable in accordance with its terms.
Purchaser is not currently insolvent nor will the acquisition of the Panaco
Shares in the manner contemplated herein render Purchaser insolvent. All
consents, authorizations and approvals (if any) required to be obtained in order
to enable Purchaser to execute, deliver and perform this Agreement have been
duly obtained. The execution, delivery and performance of this Agreement by
Purchaser will not violate or be in conflict with any provision of its
organizational documents, any material agreement or instrument to which it is a
party of by which it is bound or any judgment, decree, order, statute, rule or
regulation applicable to it.
4.2 INDEPENDENT DUE DILIGENCE INVESTIGATION. Purchaser has
relied solely upon the independent investigations made by it and its
representatives in making a decision to purchase the Panaco Shares and has a
full understanding and appreciation of the risks inherent in such a highly
speculative investment. In connection with such investigation, Purchaser and its
representatives and advisers, if any, (i) have been given an opportunity to ask,
and have to the extent Purchaser considered necessary, asked questions of, and
have received answers from, officers of Panaco concerning the Panaco Shares and
the affairs of Panaco and (ii) have been given or afforded access to all
documents, records, books and additional information which Purchaser has
requested regarding such matters.
4.3 INVESTMENT INTENT. Purchaser recognizes that the Panaco
Shares are restricted shares. Purchaser is acquiring the Panaco Shares solely
for its own account for investment and not with a view to, or for offer or
resale in connection with, a distribution thereof in violation of any applicable
federal or state securities laws.
4.4 STATUS OF PURCHASER. Purchaser represents and warrants to
Seller that it has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of an investment in
the Panaco Shares; it is an "accredited investor" as defined in Rule 501 of
Regulation D under the Securities Act of 1933, as amended (the "Securities
Act"); and it understands that the Panaco Shares are being sold to it in a
transaction that is intended to qualify for an exemption from the registration
requirements of the Securities Act which depends upon Purchaser's investment
intent in purchasing the Panaco Shares. Purchaser is not aware of any facts
or circumstances that would cause the sale of Panaco Shares contemplated by this
Agreement to fail to be exempt from registration under the Securities Act.
4.5 BROKERS. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon any arrangement
made by or on behalf of Purchaser.
5. CONDITIONS TO THE OBLIGATIONS OF SELLER.
The obligations of Seller under this Agreement are subject to
the fulfillment, or the advance waiver in writing by Seller, of the conditions
set forth in this Section 5 on or before the Closing Date.
5.1 OPINION OF COUNSEL OF PANACO. Counsel for Panaco shall
have delivered to Seller its opinion, in a form reasonably satisfactory to
Seller, that (i) the sale of the Panaco Shares to Purchaser pursuant to this
Agreement without compliance with Rule 144 promulgated under the Securities Act
does not violate any applicable securities laws and (ii) the shares of Panaco
Stock represented by Certificate Number 04929 dated December 1, 1998 were issued
to Seller in a transaction exempt from Section 16(b) ("Section 16(b)") of the
Securities Exchange Act of 1934, as amended, so that such issuance is not a
purchase or sale by Seller, within the meaning of Section 16(b), within six
months of the sale of the Panaco Shares contemplated by this Agreement.
6. CONDITIONS TO THE OBLIGATIONS OF PURCHASER.
The obligations of Purchaser under this Agreement are subject
to the fulfillment, or the waiver in writing by Purchaser, of the conditions set
forth in this Section 5 on or before the Closing Date.
6.1 RESIGNATION OF SELLER. Seller shall have resigned
from the Board of Directors of Panaco.
6.2 ELECTION OF PURCHASER DESIGNEE. A person recommended by
Purchaser shall have been elected to the Board of Directors of Panaco to fill
the seat vacated by Seller.
6.3 ASSIGNMENT OF REGISTRATION RIGHTS AGREEMENT. Panaco shall
have acknowledged in writing the assignment by Seller to Purchaser of all of
Seller's rights under that certain Registration Rights Agreement dated as of
July 30, 1997, by and between Panaco, Seller and ▇▇▇▇ ▇. ▇▇▇▇▇▇ (the
"Registration Rights Agreement").
6.4 BOARD APPROVAL. The Board of Directors of Panaco shall
have approved the: (i) purchase of the Panaco Shares by Purchaser in accordance
with the provisions of Section 203(a)(1) of the General Corporation Law of the
State of Delaware; and (ii) assignment by Seller to Purchaser of all of Seller's
rights under the Registration Rights Agreement.
7. GENERAL RELEASE.
7.1 RELEASE OF PURCHASER. Seller, for good and valuable
consideration, receipt of which is hereby acknowledged, hereby releases and
discharges Purchaser and ▇▇▇▇ ▇. Icahn (collectively, the "Purchaser Releasees")
and their respective heirs, executors, administrators, successors and assigns
from all actions, causes of action, suits, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialities, covenants, contracts, controversies,
agreements, promises, variances, trespasses, damages, judgments, extents,
executions, claims, and demands whatsoever, in law, admiralty or equity, known
or unknown, which Seller or Seller's successors and assigns ever had, now have
or hereafter can, shall or may have against any of the Purchaser Releasees for,
upon, or by reason of any matter, cause or thing whatsoever from the beginning
of the world to the date of this Agreement other than for a breach of this
Agreement.
7.2 RELEASE OF SELLER. Purchaser and ▇▇▇▇ ▇. Icahn, for good
and valuable consideration, receipt of which is hereby acknowledged, each hereby
release and discharge Seller and his heirs, executors, administrators,
successors and assigns from all actions, causes of action, suits, debts, dues,
sums of money, accounts, reckonings, bonds, bills, specialities, covenants,
contracts, controversies, agreements, promises, variances, trespasses, damages,
judgments, extents, executions, claims, and demands whatsoever, in law,
admiralty or equity, known or unknown, which Purchaser or ▇▇▇▇ ▇. Icahn or
either of their successors and assigns ever had, now have or hereafter can,
shall or may have against Seller for, upon, or by reason of any matter, cause or
thing whatsoever from the beginning of the world to the date of this Agreement
(including the transfer of the Panaco Shares as contemplated by this Agreement
without compliance with Rule 144 promulgated under the Securities Act) other
than for a breach of this Agreement.
8. INDEMNITY.
8.1 Purchaser shall defend, indemnify and save and hold
harmless Seller from and against all liabilities, losses, claims, demands,
suits, costs, expenses and damages of every kind and character, including,
without limitation, attorneys' fees, court costs, and costs of investigation,
which arise from or in connection with in any way a breach by Purchaser of its
representations and warranties contained in this Agreement or other breach of
this Agreement by Purchaser.
8.2 Seller shall defend, indemnify and save and hold harmless
Purchaser from and against all liabilities, losses, claims, demands, suits,
costs, expenses and damages of every kind and character, including, without
limitation, attorneys' fees, court costs, and costs of investigation, which
arise from or in connection with in any way a breach by Seller of its
representations and warranties contained in this Agreement or other breach of
this Agreement by Seller.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
9.1 ASSIGNMENT. For good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, effective as of the
date hereof, Seller hereby assigns, delivers and sets over unto Purchaser (to
the extent permitted under the Registration Rights Agreement) all of Seller's
rights under the Registration Rights Agreement.
9.2 FURTHER ASSURANCES. Seller hereby agrees to take such
further action and execute and deliver such further documents and instruments as
may be reasonably required to perfect the assignment referred to in this Section
9.
10. MISCELLANEOUS.
10.1 ASSIGNMENT; SUCCESSORS AND ASSIGNS. The provisions of
this Agreement shall be binding upon, and inure to the benefit of, the
respective successors, assigns, heirs, executors and administrators of the
parties hereto. This Agreement shall not be assignable, by operation of law or
otherwise, by any party without the prior written consent of the other parties
to this Agreement.
10.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
indemnities, covenants, representations and warranties contained herein shall
survive the execution and delivery of this Agreement and the Closing of the
transactions contemplated hereby.
10.3 EXPENSES. Except as otherwise expressly provided for
herein, each party to this Agreement shall bear its own costs and expenses,
including, but not limited to, attorneys' fees and expenses, in connection with
the closing of the transactions contemplated hereby.
10.4 NOTICES. All notices, requests, consents and other
communications under this Agreement shall be in writing and shall be delivered
by hand, by telecopier, by overnight mail or mailed by first class certified or
registered mail, return receipt requested, postage prepaid:
(a) If to Seller:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(or such other address as may have been furnished in writing by Seller to
Purchaser)
with a copy to:
▇▇▇▇▇▇, Arata, McCollam, ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(b) If to Purchaser:
High River Limited Partnership
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. Icahn
(or at such other address or addresses as may have been furnished to Seller in
writing by Purchaser)
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ Butowsky ▇▇▇▇▇▇▇ Shalov & ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Notices provided in accordance with this Section
8.4 shall be deemed delivered upon personal delivery, receipt by telecopy or
overnight mail, or 48 hours after deposit in the mail in accordance with the
above.
10.5 ENTIRE AGREEMENT. This Agreement, together with the
instruments and other documents contemplated to be executed and delivered in
connection herewith, contains the entire agreement and understanding of the
parties hereto, and supersedes any prior agreements or understandings between or
among them, with respect to the subject matter hereof.
10.6 AMENDMENTS AND WAIVERS. This Agreement may not be amended
or waived (either generally or in a particular instance and either retroactively
or prospectively) except by a written instrument signed by the party against
whom enforcement of such amendment, modification or waiver is sought. No waivers
of or exceptions to any term, condition or provision of this Agreement, in any
one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such term, condition or provision.
10.7 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.8 CAPTIONS. The captions of the sections, subsections and
paragraphs of this Agreement have been added for convenience only and shall not
be deemed to be a part of this Agreement.
10.9 GOVERNING LAW. This Agreement shall be governed by
and interpreted and construed in accordance with the laws of the State of
New York.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as an instrument as of the date first above written.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
_________________________
HIGH RIVER LIMITED PARTNERSHIP
By: Riverdale LLC, its general partner
By: _______________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Manager
ACKNOWLEDGED:
Panaco, Inc. ("Panaco") hereby: (i) acknowledges the
assignment by ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. ("▇▇▇▇▇▇▇▇▇") to High River Limited
Partnership ("High River") of all of Tallerine's rights under that certain
Registration Rights Agreement dated as of July 15, 1997 (the "Registration
Rights Agreement"), by and between Panaco, Tallerine and ▇▇▇▇ ▇. ▇▇▇▇▇▇
("▇▇▇▇▇▇"), as provided in Section 9 hereof; (ii) confirms that the Registration
Rights Agreement is valid and in effect as of the date hereof; (iii) agrees
that, notwithstanding any provision to the contrary contained in Section 2(a) of
the Registration Rights Agreement, any request by ▇▇▇▇▇▇ for a Demand
Registration (as defined in the Registration Rights Agreement) shall not subject
High River to the one-year waiting period provided for in said Section 2(a),
but, rather, High River shall only be subject to such one-year waiting period in
the event that a request for a Demand Registration is made by High River; (iv)
acknowledges that the sale by Tallerine to High River of the shares of Panaco
stock owned by Tallerine pursuant to the foregoing Agreement is in compliance
with all applicable securities laws and will not violate any provisions of that
certain Restated Merger Agreement dated as of July 1, 1997, by, between and
among Panaco, The Union Companies, Inc., Tallerine and ▇▇▇▇▇▇; and (v) agrees to
instruct its transfer agent to transfer to High River the shares of Panaco stock
owned by Tallerine in accordance with the foregoing agreement.
PANACO, INC.
By: ______________________________
Name:
Title:
[Signature Page to Stock Purchase Agreement]