WARRANT AND STOCK PURCHASE AGREEMENT
This Warrant and Stock Purchase Agreement (this "Agreement") is made and
entered into as of the ____ day of _________________, 1999, by and between ZEVEX
International, Inc., a Delaware corporation ("Purchaser"), ▇▇▇▇ ▇▇▇▇▇▇, an
individual resident in the State of Utah, ▇▇▇▇ ▇. ▇▇▇▇▇▇, an individual resident
in the State of Nevada, and ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLC, a Utah limited liability
company (each a "Seller" and collectively, the "Sellers"). All of the foregoing
collectively referred to as the "Parties."
WITNESSETH:
WHEREAS, each Seller owns a warrant or warrants (each a "Warrant" and
collectively, the "Warrants") entitling such Seller to purchase that number
shares of Common Stock of the Purchaser, set forth opposite such Seller's name
in Exhibit A (collectively, the "Warrant Stock");
WHEREAS, Sellers own that number of shams of Common Stock of the Company
set forth opposite such Seller's name in Exhibit A (collectively, the "Shares");
WHEREAS, Sellers desire to sell the Warrants to the Purchaser, and for the
Purchaser to introduce third parties to purchase the Shares from the Sellers,
pursuant to the terms and conditions contained herein;
WHEREAS, the purchase price for the Warrants will be based on the number of
Shares purchasable thereunder multiplied by $2.50 (that being the difference
between the exercise price of $3.50 under the Warrants and $6.00, the "Warrant
Purchase Price"), and the purchase price for the Shares will be $6 per share
(the "Share Purchase Price"), as more fully described in Exhibit A
(collectively, the "Purchase Price");
NOW THEREFORE, in consideration of the mutual covenants, agreements,
conditions, representations, and warranties contained in this Agreement, the
Purchaser and each Seller hereby agree as follows:
1. PURCHASE AND SALE OF WARRANTS AND SHARES.
1.1 PURCHASE AND SALE OF WARRANTS.
(a) Subject to the terms and conditions of this Agreement, at the
first Closing (as defined below), each Seller hereby agrees to sell to Purchaser
and the Purchaser hereby agrees to purchase from each Seller, all right, title
and interest in and to the Warrants in consideration for the Warrant Purchase
Price.
(b) Subject to all the terms and conditions of this Agreement, in
payment for the Warrants, Purchaser shall deliver to each Seller at the First
Closing, by means of a bank wire transfer, cashier's check, or other immediately
available funds, the amount indicated on Exhibit A set opposite the name of each
Seller. This consideration shall be payment in full for all of the Warrants.
(c) The Purchase and sale of the Warrants shall be held at the offices
of the Purchaser within two business days of the execution hereof, or at such
other place, time, and date as Sellers and Purchaser shall mutually agree (this
event is hereafter referred to as the "First Closing" and the date of the
Closing is hereafter referred to as the "First Closing Date"). At the First
Closing, the
Sellers shall deliver to Purchaser, the certificates representing the Warrants,
and Purchaser shall deliver to the Sellers the Warrant Purchase Price.
1.2 PURCHASE OF ADDITIONAL WARRANTS. Within ten (10) days following the
execution of this Agreement, the Purchaser shall make a tender offer to all
holders of warrants of Common Stock in the Purchaser who are not parties to this
Agreement. The offer shall be to purchase all such warrants at the Warrant
Purchase Price, with a closing thereon to occur within 14 calendar days of the
execution hereof.
1.3 PURCHASE AND SALE OF SHARES. For a period of 21 days from the execution
hereof the Purchaser shall use its reasonable best efforts to identify
prospective purchasers for the cash purchase of the Shares (the "Share
Purchasers") at the Share Purchase Price. In the event that Share Purchasers are
identified who are prepared to purchase less than all of the Shares, then each
Seller shall have the right to sell its pro rata portion of the Shares to such
Share Purchasers. Each Seller covenants and agrees that it shall sell its Shares
(or pro rata portion thereof) in the event that a Share Purchaser or Share
Purchasers are prepared to purchase such Shares (or portion thereof) at the
Share Purchase Price. The Sellers and the Share Purchasers shall enter into a
definitive purchase agreement for the purchase of the Shares, which agreement
shall be in form and Substance satisfactory to the Purchaser and each Seller.
Consummation of the purchase of the Shares shall occur on one or more occasions
between the date of execution hereof and that date which is 21 calendar days
from the date of execution hereof (the "Subsequent Closing").
2. REPRESENTATIONS AND WARRANTIES OF THE SELLER.
Each of the Sellers hereby represents and warrants to the Purchaser that
the statements contained in this Section 2 are correct and complete as of the
date of this Agreement and shall be correct and complete as of the First Closing
Date and as of the Subsequent Closing with respect to himself or itself, as
follows:
2.1 AUTHORIZATION OF TRANSACTIONS. Seller has full power and authority to
execute and deliver this Agreement and to perform his or her obligations
hereunder. This Agreement constitutes the valid and legally binding obligation
of the Seller, enforceable in accordance with its terms and conditions. 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.
2.2 NONCONTRAVENTION. 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, (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 he
or she is bound or to which any of his or her assets is subject.
2.3 WARRANTS AND SHARES. The Seller holds of record and owns beneficially
the Warrants for the number of shares of common stock purchasable under the
Warrants, and the number of Shares, set forth opposite such Seller's name in
Exhibit A, free and clear of any restrictions on transfer (other than
restrictions under the Securities Act and state securities laws), taxes,
security interests, purchase rights, contracts, commitments, equities, claims,
liens, charges, pledges, encumbrances and demands of any kind or nature
whatsoever. The Seller is not a party to any option, warrant, purchase right, or
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other contract or commitment that could require the Seller to sell, transfer, or
otherwise dispose of the Warrants and/or the common stock purchasable under the
Warrants and/or the Shares (other than this Agreement).
3. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.
The Purchaser represents and warrants to the Sellers that the, statements
contained in this Section 3 are correct and complete as of the date hereof and
will be correct and complete as of the First Closing Date and the Subsequent
Closing, as follows:
3.1 AUTHORITY. The Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
Purchaser has all requisite corporate power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby and thereby.
All corporate acts and other proceedings required to be taken by the Purchaser
to authorize the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby and thereby have been duly
and properly taken. This Agreement has been duly executed and delivered by the
Purchaser and constitutes a valid and binding obligation of the Purchaser,
enforceable against the Purchaser in accordance with its terms.
3.2 NONCONTRAVENTION. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
(a) violate any constitution, regulation, rule, injunction, judgment, order,
decree, ruling, charge, or other restriction of any government, governmental
agency, or court to which the Purchaser is subject 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 Purchaser is a party or by which it is bound or
to which any of its assets is subject.
4. CONDITIONS OF FIRST CLOSING.
4.1 The following shall be conditions precedent to the Purchaser's
obligations hereunder, and shall be accomplished at or before the first Closing:
(a) the representations and warranties set forth in Section 2 above
shall be true and correct in all material respects at and as of the First
Closing Date;
(b) Sellers shall have Performed and complied with all of their
covenants hereunder in all material respects through the First Closing; and
(c) execution and delivery of this Agreement by the Sellers.
4.2 The following shall be conditions precedent to the Sellers obligations
hereunder, and shall be accomplished on or before the First Closing:
(a) the representations and warranties set forth in Section 3 above
shall be true and correct in all material respects at and as of the First
Closing Date; and
(b) execution and delivery of this Agreement by the Purchaser; and
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(c) payment of the Warrant Purchase Price to the sellers by the
Purchaser.
4.3 Each Party may waive any condition for its benefit specified in this
Section 4 by written waiver executed so stating at or prior to the Closing.
5. COVENANTS OF THE SELLERS.
From and after the date of execution hereof, each Seller covenants and
agrees on behalf of itself and any and all Affiliates (as defined below) of the
Seller, regardless of whether any such Affiliate was an Affiliate at the date of
execution hereof, that it shall not:
(a) acquire or attempt to acquire any security of the Purchaser, or
any Affiliate of the Purchaser, or any interest therein, including, without
limitation, any share of stock, warrant, option, debenture, or instrument
convertible into any of the foregoing, provided that the parties acknowledge
that as of the date hereof the Sellers own those Shares set forth on Exhibit A;
(b) make or participate in any solicitation of proxies without the
consent of the Purchaser, seek to advise or influence any person with respect to
the voting of any voting securities of the Purchaser, or continue with any proxy
solicitation that it, or any Affiliate of it, may have commenced prior to the
date of execution hereof;
(c) form, join or in any way participate in a "group" within the
meaning of Section 13(d)(3) of the Securities and Exchange Act of 1934 with
respect to the voting securities of the Purchaser;
(d) induce or attempt to induce or give encouragement to any other
person to initiate any proposal or tender or exchange offer for any securities
or change of control of the Purchaser, or
(e) otherwise act, alone or in concert with others to seek to control
or influence the management, board of directors or policies of the Purchaser.
For purposes of this Agreement, an "Affiliate" shall mean with respect to a
person, any person that directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
such person.
6. POST-CLOSING COVENANTS.
6.1 ▇▇. ▇▇▇▇▇▇ hereby agrees that within five (5) days of the Sellers
collectively owning less than 3% of the issued and outstanding shares of Common
Stock of the Company (or shares convertible into Common Stock), that Mr, ▇▇▇▇▇▇
will resign as a director of the Purchaser effective within such period,
provided that if ▇▇. ▇▇▇▇▇▇ fails to resign within such period then ▇▇. ▇▇▇▇▇▇
shall be deemed to have resigned at the end of the such five (5) day period,
6.2 In the event that the Sellers collectively own less than 3% of the
issued and outstanding shares of Common Stock of the Company (Or shares
convertible into Common Stock) then the demand registration rights of ▇▇. ▇▇▇▇▇▇
and ▇▇. ▇▇▇▇▇▇ (together with any transferee or assignee of such rights) set
forth in Section 2 of that certain Registration Rights Agreement between the
Company and Messrs. ▇▇▇▇▇▇ and ▇▇▇▇▇▇, dated as of February 1, 1998, shall
immediately terminate without further action of the parties thereto.
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6.3 Each of the sellers hereby agrees to abstain from voting any of their
shares of common stock of the Company at the Annual Meeting of Shareholders,
scheduled for June 2, 1999, and any adjournment thereof.
7. RELEASE OF CLAIMS.
From and after the date of execution hereof:
7.1 Sellers, on behalf of themselves and each of their partners,
affiliates, associates, agents, representatives, predecessors, successors, and
assigns, past, present, and future, hereby release and forever discharge the
Purchaser and each of their respective Affiliates, directors, officers,
employees, associates, attorneys, accountants, agents, representatives,
successors, and assigns, past, present, and future, from any and all legal
claims, demands, liens, agreements, contracts, covenants, actions, suits, causes
of action, obligations, controversies, debts, costs, expenses, damages,
judgments, orders, and liabilities of whatever kind or nature in law, equity, or
otherwise, whether now known or unknown, suspected or unsuspected, concealed or
hidden, of any kind or nature whatsoever.
7.2 Purchaser, on behalf of itself and each of its partners, affiliates,
associates, agents, representatives, predecessors, successors, and assigns,
past, present, and future, hereby releases and forever discharges Sellers and
each of their respective affiliates, associates, attorneys, accountants, agents,
representatives, successors, and assigns, past, present, and future, from any
and all legal claims, demands, liens, agreements, contracts, covenants, actions,
suits, causes of action, obligations, controversies, debts, costs, expenses,
damages, judgments, orders, and liabilities of whatever kind or nature in law,
equity, or otherwise, whether now known or unknown, suspected or unsuspected,
concealed or hidden, of any kind or nature whatsoever.
8. MISCELLANEOUS PROVISIONS.
8.1 WAIVER OF NOTICE OF BOARD MEETING. ▇▇. ▇▇▇▇▇▇ hereby waives notice of
the board of directors meeting of the Purchaser held on May 24, 1999.
8.2 MODIFICATIONS AND WAIVERS. This Agreement may not be amended or
modified, not may the rights of any party hereunder be waived, except by a
written document that is executed by the Parties.
8.3 ASSIGNMENT. This Agreement is and shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns;
provided, however, that no Purchaser may assign the Agreement to any third party
without the prior written consent of the other Party.
8.4 RIGHTS AND OBLIGATIONS OF THIRD PARTIES. Nothing in this Agreement,
whether express or implied, is intended to confer any rights or remedies under
or by reason of this Agreement on any persons other than the parties to it and
their respective successors and permitted assigns, nor is anything in this
Agreement intended to relieve or discharge the obligation or liability of any
third parties to any party to this Agreement, nor shall any provision give any
third party any right of subrogation or action against any party to this
Agreement.
8.5 NOTICES. Any notice, request, consent, or other communication hereunder
shall be in writing, and shall be sent by one of the following means: (i) by
registered or certified first class mail, postage prepaid; (ii) by facsimile
transmission; (iii) by reputable overnight courier service; or (iv) by personal
delivery, and shall be properly addressed as follows:
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If to the Purchaser, to: ZEVEX International, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Chief Executive
Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: Jones, Waldo, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Post ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Sellers, to: To each Seller as set forth on Exhibit A
or to such other address or addresses as the Sellers or Purchasers shall
hereafter designate to the other party in writing. Notices sent by mail or by
courier shall be effective three (3) days and one (1) day, respectively, after
they are sent, and notices delivered Personally or by facsimile shall be
effective at the time of delivery thereof.
8.6 ENTIRE AGREEMENT. This Agreement, including the Exhibits hereto,
constitutes the entire agreement between the parties hereto in relation to the
matters contemplated hereby. Any prior written or oral negotiations,
correspondence, or understandings relating to the matters contemplated hereby
shall be superseded by this Agreement and shall have no force or effect.
8.7 FURTHER ASSURANCES. Each Party hereby agrees to take all actions, and
execute all documents and instruments as either Party deems reasonably necessary
or appropriate to give effect to this Agreement.
8.8 SEVERABILITY. If any provision which is not essential to the
effectuation of the basic purpose of this Agreement is determined by a court of
competent jurisdiction to be invalid and contrary to any existing or future law,
such invalidity shall not impair the operation of the remaining provisions of
this Agreement.
8.9 HEADINGS. The headings of the Sections of this Agreement are inserted
for convenience of reference only and shall not affect the construction or
interpretation of any provisions hereof.
8.10 ARBITRATION. All disputes hereunder shall be resolved by mediation,
and if resolution is not reached by the patties, then the dispute will be
submitted to binding arbitration before a single arbitrator in Salt Lake City,
Utah, in accordance with the applicable Arbitration Rules of the American
Arbitration Association then in effect. Judgment rendered by the arbitrator may
be entered in any court having jurisdiction over the party.
8.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when executed and delivered shall be an original,
but all of which together shall constitute one and the same instrument.
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8.12 GOVERNING LAW. This Agreement shall be construed in accordance with
and governed by the laws of the State of Utah without regard to the law of
conflict of laws.
IN WITNESS WHEREOF, the Company and the Purchasers each have caused this
Agreement to be executed by their duly authorized representative as of the day
and year first above written.
ZEVEX International, Inc. Sellers
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------- -----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
Chief Executive Officer
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLC
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
--------------------------
▇▇▇▇ ▇▇▇▇▇▇, Manager
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Print Name/Title
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EXHIBIT A
Shares of
Name Warrant Stock Purchase Price Warrant Shares
---- ------------- -------------- --------------
▇▇▇▇ ▇▇▇▇▇▇ 175,000 $437,500 125,000
▇▇▇▇ ▇. ▇▇▇▇▇▇ 175,000 $437,500 125,000
▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLC. 250,000
Addresses for Notices:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLC ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
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