STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (hereinafter referred to as the
"Agreement") is entered into this ____ day of March, 1999 by and among ▇▇▇▇ ▇.
▇▇▇▇▇▇▇ an individual with an address of ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ with an address of ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇.▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ with an address of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇ ▇▇. ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇ with an address of ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to collectively as the
"Sellers"), J.S. Transportation, Inc., a New Jersey corporation, located at ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to as the
"Company") and New York Regional Rail Corporation, a Delaware corporation,
located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (hereinafter referred to as
"Buyer").
WITNESSETH:
WHEREAS, Sellers are the owners of all of the issued and outstanding
capital stock of the Company;
WHEREAS, on February 25, 1999 the Company purchased from ▇▇▇▇▇▇ ▇. ▇▇▇▇
all of the issued and outstanding capital stock of a trucking company known as
GM Trucking & Associates, Inc.;
WHEREAS, on February 25, 1999 the Company purchased from ▇▇▇▇▇▇ ▇. ▇▇▇▇
the equipment utilized by GM Trucking & Associates, Inc. in the ordinary course
of its business;
WHEREAS, effective February 25, 1999 the Company began operating GM
Trucking & Associates, Inc.;
WHEREAS, Buyer desires to diversify its business operations by
acquiring an ownership interest in a trucking operation; WHEREAS,
Sellers desire to transfer fifty one percent (51%) of the issued and
outstanding corporate stock of the Company
and forty nine percent (49%) of the voting interest in the Company and Buyer
desires to acquire fifty one percent (51%) of the issued and outstanding
corporate stock of the Company and forty nine percent (49%) of the voting
interest in the Company.
NOW, THEREFORE, in consideration of the premises and of the mutual
promises, covenants, representations and warranties herein contained, the
parties hereto, intending to be legally bound by the terms hereof, covenant and
agree as follows:
1. Sale and Purchase of Stock. Subject to the terms and conditions
contained herein, on the Closing Date (as hereinafter defined) Sellers
in reliance upon the representations and warranties of Buyer contained
herein, shall sell to Buyer, and Buyer in reliance upon the
representations and warranties of Seller contained herein, shall
purchase from Sellers, fifty one percent (51%) of the issued and
outstanding capital stock of the Company and forty nine percent (49%)
of the voting interest in the Company.
2. Consideration. On the Closing Date, Buyer shall transfer to Sellers
five million (5,000,000) unregistered shares of the class "A" common
stock of New York Regional Rail Corporation (hereinafter referred to as
the "Shares"). The Shares shall be restricted for a period of one year
from the Closing Date. The Shares shall be registered with the
Securities Exchange Commission (hereinafter referred to as the "SEC")
when Buyer files its next Common Stock registration with the SEC or
files to become a fully reporting company. On the Closing Date Buyer
shall also transfer to the Company one hundred and fifty thousand
dollars ($150,000) to be used only to reduce the debt of GM
Transportation. In lieu of a cash transfer Seller has agreed to accept
registered and unrestricted shares of Class "A" common stock of New
York Regional Railroad valued at $150,000. The per share value shall
be computed based upon the average closing price per share for the ten
trading days prior to the Closing Date with a minimum per share value
of fifteen cents ($ .15). Additionally, if during the period beginning
March 1, 1999 through April 18, 1999 the Company produces
transportation revenues in an amount equal to $90,000 or more during
any 7 day period beginning on a Sunday through a Saturday Sellers are
entitled to receive an additional two million (2,000,000) unregistered
shares of the class "A" common stock of New York Regional Rail
Corporation (hereinafter referred to as the "Bonus Shares").
Transportation Revenues shall be defined as those revenues less
"tipping fees", if the "tipping fees" are not a straight pass through
than the net difference shall be considered revenue for purposes of
this section 2. The Bonus shares shall be transferred to Sellers
within seven days of Sellers entitlement to the Bonus Shares. The Bonus
Shares shall be restricted for a period of one year from the transfer
date. The Bonus Shares shall be registered with the SEC when Buyer
files its next Common Stock registration with the SEC or files to
become a fully reporting company.
3. Representations, Warranties and Covenants of Sellers. Sellers
represent, warrant and covenant to Buyer that:
(a) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Delaware; has full corporate power and authority to carry on
its business as it is now being conducted and to own and operate the
properties and assets now owned or operated by it; is duly qualified to
do business and is in good standing in each jurisdiction where, in the
good faith judgment of the management of the Company, the conduct of
its business or the ownership of its property and assets requires such
qualification. A complete and correct copy of the Articles of
Incorporation of The Company together with all amendments thereto,
certified by the Secretary of State of Delaware, a complete and correct
copy of the By-Laws of the Company together with all amendments thereto
have been delivered to Buyer.
(b) The authorized capital stock of the Company consists
solely of 2500 shares of Class A, no par, Common Stock. At Closing
there will be 1000 shares in the aggregate issued, outstanding and
owned by Sellers (hereinafter referred to as the "Sellers' Stock"). At
Closing, all issued and outstanding shares will be fully paid and
non-assessable and will have been issued in compliance with all
applicable federal and state securities laws.
(c) On the Closing Date Sellers will be the sole registered,
legal and beneficial owners of the Sellers' Stock and will have good
and marketable title to the Sellers' Stock, free and clear of any
pledges, claims, liens, assessments, encumbrances or restrictions of
any nature whatsoever, including, without limitation, existing
agreements, subscriptions, options, warrants, calls, commitments or
rights of any nature granting to any party an interest in or right to
acquire any of the outstanding capital stock of the Company now or at
the Closing Date owned by Sellers.
(d) There are no outstanding securities of the Company which
are convertible into shares of the Company and there exist no
agreements, subscriptions, options, warrants, calls, commitments or
rights to purchase shares of the Company or any such securities
convertible into shares of the Company.
(e) Sellers have full power and authority or will obtain all
approvals necessary for them to enter into this Agreement and to
transfer 51% of Sellers' Stock to Buyer upon the terms and conditions
set forth herein and to vest good and marketable title to 51% of the
Sellers' Stock in Buyer and upon the sale and delivery of 51% of the
Sellers' Stock on the Closing Date good and marketable title thereof,
free and clear of any pledges, claims, liens, assessments, encumbrances
or restrictions of any nature whatsoever, shall pass to and vest in
Buyer.
(f) Sellers have delivered to Buyer copies of:
(i) a copy of the Stock Purchase Agreement, with
all exhibits appended thereto, between the
Company and ▇▇▇▇▇▇ ▇. ▇▇▇▇ dated February
25, 1999.
(ii) a copy of the Installment Sale Agreement,
with all exhibits appended thereto, between
the Company and ▇▇▇▇▇▇ ▇. ▇▇▇▇ dated
February 25, 1999.
(iii) a copy of the Escrow Agreement, with all
exhibits appended thereto, between the
Company and ▇▇▇▇▇▇ ▇. ▇▇▇▇ dated February
25, 1999.
(m) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby in the manner
herein provided will:
(i) contravene any provision of the Articles of Incorporation or By-Laws of
the Company;
(ii) violate, be in conflict with, constitute a default under, cause the
acceleration of any payments pursuant to or otherwise impair the good
standing, validity and effectiveness of any agreement, contract,
indenture, lease or mortgage, or subject any properties or assets of
the Company to any indenture, mortgage, contract, commitment or
agreement (other than the present Agreement) to which Sellers or the
Company is a party or to which Sellers or the Company is subject; or
(iii) violate any provision of law, rule, regulation, order, permit or
license to which the Company is subject or pursuant to which the
Company conducts its business.
(n) Neither Sellers nor the Company has offered, paid or
agreed to pay, directly or indirectly, any money or anything of value
to any individual who is an official or employee of any governmental
agency, either federal or state, or any agency or instrumentality for
the purpose of inducing that individual to use his or her influence to
obtain or maintain business or any other benefit of the Company, nor
has the Company made any political payment or contribution in
contravention of law.
(o) Sellers represent that they will make available to the
Company working loan capital in the amount of One Hundred Thousand
Dollars ($100,000). These funds may be reduced by Seller by all funds
contributed to the Company or GM Trucking from the date beginning March
1, 1999.
4. Representations and Warranties of Buyer. Buyer represents and warrants
to Sellers that:
(a) Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has
full corporate power and authority to carry on its business as it is
now being conducted and to own and operate the properties and assets
now owned or operated by it.
(b) Buyer has full corporate power and authority to enter into
this agreement and to purchase and take title to 51% of the Sellers'
Stock upon the terms and conditions set forth herein and to purchase
49% of the voting interest in the Company.
(c) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby in the manner
herein provided will:
(i) contravene any provision of the Articles
of Incorporation or By-Laws of Buyer,
(ii) violate, be in conflict with,
constitute a default under, cause the
acceleration of any payments pursuant to or
otherwise impair the good standing, validity
and effectiveness of any lease, license,
permit, authorization or approval applicable
to Buyer; or
(iii) violate any provision of law, rule,
regulation, order, or permit to which Buyer
is subject or pursuant to which Buyer
conducts its business.
(d) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been
duly approved by all necessary corporate action on the part of
Buyer. (e) The Shares to be issued to Seller hereunder are
duly authorized and, when issued to Seller in accordance with
the terms of this Agreement, will be validly issued, fully
paid and nonassessable.
5. Conduct of Business of the Company Pending the Closing. Sellers
represent, warrant, and covenant that from and after the date hereof to
the Closing Date, except as otherwise contemplated by this Agreement,
the Company will conduct its business solely in the ordinary course
(including regular employee bonus programs) and will:
(a) not amend its Articles of Incorporation or By-Laws except
as may be necessary to carry out this Agreement or as required
by law;
(b) not issue any capital stock or other securities, enter
into any contract, commitment or agreement to issue any
capital stock or other securities of the Company or issue any
warrants, rights or options to purchase or otherwise acquire
any capital stock of the Company;
(c) not declare, authorize or make any distribution or
dividend of cash, property or securities to any of its
shareholders, directly or indirectly;
(d) not merge or consolidate with any other corporation or
entity; sell, transfer or otherwise dispose of any priority or
assets other than in the ordinary course of business; or
acquire or agree to acquire or be acquired by any corporation,
association, partnership, joint venture or other entity;
(e) not enter into any agreement not in the ordinary course of
business or, without the prior written consent of Buyer, any
agreement for the acquisition of additional operating
authorities;
(f) not create, incur, assume or guarantee any indebtedness
for money borrowed or create or suffer to exist any mortgage,
lien or other encumbrance on any of its property or assets,
real or personal, other than encumbrances on property and
assets created in the ordinary course;
(g) not pay, discharge, compromise or otherwise satisfy any
liability or obligation of the Company other than in the
ordinary course of business and otherwise in accordance with
this Agreement;
(h) not cancel, waive or modify any debts, claims or other
rights owned by, or running in favor of, the Company;
(i) not make any capital expenditures or capital additions or
betterments except such as may be involved in ordinary
repairs, maintenance, and replacements; or
(j) not change any accounting principle or practice or the
method of applying any such principle or practice.
(k) maintain the Company facilities, assets and properties in
good operating repair, order and condition, reasonable wear
and tear excepted;
(l)maintain in full force and effect insurance coverage of the
types and in the amounts currently carried by the Company;
(m)maintain in full force and effect all agreements, contracts
leases, licenses, permits, authorizations or approvals
necessary for or related to the operation of the business of
the Company and the truck-related business of GM Trucking &
Associates, Inc. in all respects and places as such businesses
are now conducted;
(n) use its best efforts to preserve the Company's business
organization intact;
(o) provide Buyer the opportunity to be kept apprised of the
activities of the management of the Company, and during normal
business hours, with full access to all books, records,
equipment, real estate, contracts and other assets of the
Company and, insofar as the same are relevant to its truck-
related assets, of GM Trucking & Associates, Inc.; make
available to Buyer all such documents, copies of documents and
records and information with respect to the affairs of the
Company and the truck-related business of GM Trucking
& Associates, Inc. as Buyer may request and furnish to Buyer
and Buyer's representatives copies of any working papers
relating to such documents and records as Buyer shall from
time to time request.
6. Board of Directors. The Board of Directors of the Company shall
initially consist of five members. Sellers shall be entitled to
designate three of the initial Directors and Buyer shall be entitled to
designate two of the initial Directors.
7. The Closing. The Closing Date shall be not later than March 13,
1999 at 10:00am at the offices of ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ located at ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇.
8. Brokerage; Expenses. The Sellers and the Buyer represent,
warrant and covenant that all negotiations relative to this
Agreement have been carried on by them directly without the
intervention of any other person and Sellers will indemnify Buyer
and/or the Company and hold each of them harmless against and in
respect of any claim for brokerage or other fees or commissions
relative to this Agreement or the transactions contemplated hereby.
The Buyer agrees similarly to indemnify the Sellers as to any such
claims made by any person, firm or corporation claiming through
Buyer. Except as otherwise expressly provided in this Agreement,
Seller and the Buyer agree to bear their respective expenses
individually, each in respect of all expenses of any character incurred
by it in connection with this Agreement or the transactions
contemplated hereby.
9. Contents of Agreement. This Agreement sets forth the entire
understanding of the parties hereto with respect to the transactions
contemplated hereby and shall not be amended or terminated except by
written instrument duly executed by each of the parties hereto. Any and
all previous agreements or understandings between the parties regarding
the subject matter hereof are superseded in their entirety by this
Agreement.
10. Binding Effect and Assignees. All terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be
enforceable by each of the parties and their respective heirs, personal
representatives, successors and assigns. Neither Buyer nor Sellers
shall assign their respective rights nor delegate their respective
obligations hereunder to any person without the prior written consent
of the other party hereto.
11. Notices. All notices, requests, demands, waivers, consents,
approvals, or other communications which are required or permitted
hereunder shall be in writing and delivered personally or by
register or certified mail, postage prepaid, as follows:
If to Buyer:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Sellers:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Or at such other address as the party entitled to receive such notice
may, from time to time, specify.
12. Shareholder Distributions. Shareholder distributions will be
made in accordance with the Monthly Profit Distribution
Agreement a copy of which is appended hereto as Exhibit "A".
13. New Jersey Law to Govern. This Agreement shall be governed as to its
validity, interpretation and effect by the laws of the State of New
Jersey.
14. Section Headings. All section headings herein have been inserted for
convenience of reference only and shall in no way modify or restrict
any of the terms or provisions hereof.
15. Exhibits. All Exhibits referred to in this Agreement are
intended to be and are hereby specifically incorporated by
reference herein.
16. Further Actions and Assurances. The parties hereto shall execute and
deliver such additional documents and shall cause such further and
additional action to be taken, either before or after the Closing Date,
which may be required or, in the judgment of the parties, necessary or
desirable to effect or evidence the provisions of this Agreement and
the transactions contemplated hereby.
17. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of
such counterparts together shall constitute but one and the same
instrument. It shall not be necessary in making proof of this
Agreement or any counterpart hereof to produce or account for any of
the other counterparts.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
SELLERS
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BUYER
New York Regional Rail Corporation
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Acting President