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Exhibit 10.22
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is dated as of June
28, 2000, by and among American Homestar Corporation, a Texas corporation
("Seller"), XXI Holding Co. Inc., a Delaware corporation ("Buyer") and 21st
Century Mortgage Corporation, a Delaware corporation (the "Company").
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Buyer desires to purchase from Seller and Seller desires to sell to
Buyer 2,500,000 shares of the common stock (the "Shares") of the Company, which
shares constitute 50% of the issued and outstanding shares of capital stock of
the Company, upon the terms and subject to the conditions hereinafter set forth.
Accordingly, intending to be legally bound, the parties hereto hereby
agree as follows:
ARTICLE I.
PURCHASE AND SALE OF THE SHARES; CLOSING
1.1 Purchase and Sale of the Shares. On the terms and subject to the
conditions of this Agreement, Seller hereby agrees to sell, transfer and deliver
to Buyer, and Buyer hereby agrees to purchase from Seller, the Shares for an
aggregate purchase price of Six Million Three Hundred Thousand Dollars
($6,300,000) (the "Purchase Price").
1.2 Payment of Purchase Price. The Purchase Price shall be paid in cash
at Closing (as defined below).
1.3 Closing. The closing of the transaction contemplated hereby (the
"Closing") shall occur on the date hereof, at the offices of Buyer or at such
other time and location as determined by the parties. At Closing, Seller shall
deliver to Buyer all certificates representing the Shares, properly endorsed to
Buyer.
ARTICLE II.
OTHER CLOSING DELIVERIES
2.1 Other Closing Deliveries. As a condition to the Closing, at the
Closing, the parties shall deliver, or cause to be delivered, to each other, the
following:
(a) Seller and the Company shall enter into a Limited
Liability Company Agreement, in the form of which is attached hereto as
Exhibit A, and Seller shall make a $2,400,000 capital contribution to
the LLC (as defined below) in cash from the proceeds of the sale of the
Shares, and the Company shall make a $2,400,000 capital contribution to
the LLC in cash.
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(b) The Company and Homestar 21, LLC (the "LLC") shall execute
and deliver the June 2000 Revenue Sharing Agreement, in the form
attached hereto as Exhibit B.
(c) The Seller and the Company shall execute and deliver the
Manufactured Home Dealer Agreement of even date herewith, in the form
attached hereto as Exhibit C.
(d) Seller shall deposit with the Company $1,000,000 cash from
the proceeds of the sale of Shares as required in Section 4.2 below.
(e) The parties to the Security Holders Agreement of the
Company, dated as of September 14, 1995 (the "Securityholders
Agreement"), shall have executed and delivered to each other an
amendment, the form of which is attached hereto as Exhibit D.
(f) Seller shall deliver to the Company resignation letters
for each director of the Company designated by Seller.
(g) The Company will pay to Seller in cash the amounts listed
on Exhibit E attached hereto. ---------
(h) The Company and Vanderbilt Mortgage and Finance, Inc.
shall have executed and delivered the Sales and Servicing Agreement the
form of which is attached hereto as Exhibit F. ---------
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of Seller. Seller hereby represents
and warrants to Buyer as follows:
(a) Authority. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Texas.
Seller has all requisite corporate power and authority to enter into
this Agreement and the other agreements, documents and instruments
described in Article II above (collectively with the Agreement, the
"Transaction Documents") and to consummate the transactions
contemplated in the Transaction Documents. All corporate acts and other
proceedings required to be taken by Seller to authorize the execution,
delivery and performance of the Transaction Documents and the
consummation of the transactions contemplated thereby have been duly
and properly taken. The Transactions Documents have been duly executed
and delivered by Seller and constitute valid and binding obligations of
Seller, enforceable against Seller in accordance with their respective
terms. The execution and delivery of the Transaction Documents do not,
and the consummation of the transactions contemplated thereby and
compliance with the terms thereof will not result in any violation of
or default, except for violations or defaults which would not,
individually or in the aggregate, have a material adverse effect, under
(i) any provision of the Certificate of Incorporation or By-laws of
Seller, (ii) any note, bond, mortgage, indenture, deed of trust,
license, lease, contract, commitment or agreement to which Seller is a
party or (iii) any judgment, order or decree, or statute, law
ordinance, rule or regulation applicable to
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Seller or to the property or assets of Seller. No consent is required
to be obtained or made by or with respect to Seller in connection with
the execution and delivery of the Transaction Documents or the
consummation by Seller of the transactions contemplated thereby, other
than (A) compliance with applicable securities laws, (B) those consents
previously obtained by Seller, and (C) those consents the failure to
obtain which would not, individually or in the aggregate, have a
material adverse effect on the business of Seller.
(b) The Shares. Seller owns of record and beneficially
2,500,000 Shares of the Company. Seller owns the Shares free and clear
of any claims, liens, encumbrances, security interests, options,
charges or restrictions whatsoever except as set forth in the
Securityholders Agreement ("Encumbrances").
(c) Litigation. To Seller's knowledge and belief, as of the
date of this Agreement, there are no lawsuits, claims, proceedings or
investigations pending or threatened by or against or affecting
Seller's or any of its properties, assets, operations or business,
including the Shares, that do or would have a material effect on
Seller's operations.
3.2 Representations and Warranties of Buyer. Buyer hereby represents
and warrants to Seller as follows:
(a) Authority. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
Buyer has all requisite corporate power and authority to enter into the
Transaction Documents and to consummate the transactions contemplated
thereby. All corporate acts and other proceedings required to be taken
by Buyer to authorize the execution, delivery and performance of the
Transaction Documents and the consummation of the transactions
contemplated thereby have been duly and properly taken. The Transaction
Documents have been duly executed and delivered by Buyer and constitute
valid and binding obligations of Buyer, enforceable against Buyer in
accordance with their respective terms. The execution and delivery of
the Transaction Documents do not, and the consummation of the
transactions contemplated thereby and compliance with the terms thereof
will not result in any violation of or default, except for violations
or defaults which would not, individually or in the aggregate, have a
material adverse effect, under (i) any provision of the Certificate of
Incorporation or By-laws of Buyer, (ii) any note, bond, mortgage,
indenture, deed of trust, license, lease, contract, commitment or
agreement to which Buyer is a party or (iii) any judgment, order or
decree, or statute, law ordinance, rule or regulation applicable to
Buyer or to the property or assets of Buyer. No consent is required to
be obtained or made by or with respect to Buyer in connection with the
execution and delivery of the Transaction Documents or the consummation
by Buyer of the transactions contemplated thereby, other than (A)
compliance with applicable securities laws, (B) those consents
previously obtained by Buyer, and (C) those consents the failure to
obtain which would not, individually or in the aggregate, have a
material adverse effect on the business of Buyer.
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(b) To Buyer's knowledge and belief, as of the date of this
Agreement, there are no lawsuits, claims, proceedings or investigations
pending or threatened by or against or affecting Buyer or any of its
properties, assets, operations or business, including the Shares, that
do or would have a material effect on Buyer's operations.
(c) If Buyer or the Company or any shareholder of either the
Buyer or the Company, within 180 days of the Closing, sells or agrees
to sell any shares of the Company at a price greater than $2.52 per
share, Buyer will promptly thereafter pay to Seller an amount equal to
the product of the difference between such share sales price and $2.52
multiplied by 2,500,000.
(d) To Buyer's knowledge and belief, as of the date of this
Agreement, there is no material information relating to the Company or
its prospects that has not been disclosed to or is not otherwise known
to Seller (including, without limitation, any possible investments,
joint ventures or similar transactions by the Company).
3.3 Representations and Warranties of the Company. The Company hereby
represents and warrants to Seller as follows:
(a) Authority. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Delaware. The Company has all requisite corporate power and authority
to enter into the Transaction Documents and to consummate the
transactions contemplated thereby. All corporate acts and other
proceedings required to be taken by the Company to authorize the
execution, delivery and performance of the Transaction Documents and
the consummation of the transactions contemplated thereby have been
duly and properly taken. The Transaction Documents have been duly
executed and delivered by the Company and constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their respective terms. The execution and delivery of
the Transaction Documents do not, and the consummation of the
transactions contemplated thereby and compliance with the terms hereof
will not result in any violation of or default, except for violations
or defaults which would not, individually or in the aggregate, have a
material adverse effect, under (i) any provision of the Certificate of
Incorporation or By-laws of the Company, (ii) any note, bond, mortgage,
indenture, deed of trust, license, lease, contract, commitment or
agreement to which the Company is a party or (iii) any judgment, order
or decree, or statute, law ordinance, rule or regulation applicable to
the Company or to the property or assets of the Company. No consent is
required to be obtained or made by or with respect to the Company in
connection with the execution and delivery of the Transaction Documents
or the consummation by the Company of the transactions contemplated
thereby, other than (A) compliance with applicable securities laws, (B)
those consents previously obtained by the Company, and (C) those
consents the failure to obtain which would not, individually or in the
aggregate, have a material adverse effect on the business of the
Company.
(b) To the Company's knowledge and belief, as of the date of
this Agreement, there are no lawsuits, claims, proceedings or
investigations pending or threatened by or
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against or affecting the Company or any of its properties, assets,
operations or business that do or would have a material effect on the
Company's operations.
(c) To the Company's knowledge and belief, as of the date of
this Agreement, there is no material information relating to the
Company or its prospects that has not been disclosed to or is not
otherwise known to Seller (including, without limitation, any possible
investments, joint ventures or similar transactions by the Company).
ARTICLE IV.
OTHER AGREEMENTS
4.1 From time to time, as and when requested by any party hereto, the
other parties shall execute and deliver, or cause to be executed and delivered,
all such documents and instruments and shall take, or cause to be taken, all
such further or other actions as may reasonably be necessary or desirable to
consummate the transactions contemplated by this Agreement
4.2 Required Guaranty Deposit for the Obligation of Seller Under the
1995 Dealer Agreement.
(a) Notwithstanding anything herein or any other agreement or
document by and between Seller and the Company, the agreements between
the parties relating to the sale, handling and financing of
repossessions under the Manufactured Home Dealer Agreement, dated
November 21, 1995, and all subsequent amendments thereto, by and
between the Company and Seller shall be exclusively as provided in
Exhibit G attached hereto.
(b) In order to establish a short term credit facility
(hereinafter the "Repo Line") to be used by the Company and Seller to
meet their obligations to payoff repossessions of Contracts (as that
term is defined in Exhibit G hereto) sold to Investors (as that term is
defined in Exhibit G hereto), Seller will deposit with the Company
$1,000,000 in cash from the proceeds of the sale of the Shares. The
Company shall hold the deposit in an interest bearing account for the
benefit of Seller and may pledge the deposit as required by any
financial institution, including the Company that provides the Repo
Line.
Until the later of August 31, 2000, or until such time as the Company
can secure a bank line, the Repo Line provided by the Company shall be
in the amount of $2,000,000, utilizing the $1,000,000 Seller deposit as
collateral. The Company shall attempt to secure a bank line in the
amount of $2,000,000 utilizing the $1,000,000 Seller deposit as
collateral.
4.3 Until August 1, 2001, as long as Associates Housing Finance, LLC
("AHF") continues to conduct business with the Company in a manner substantially
consistent with its conduct and practices prior to the Closing, the Company will
continue to operate with AHF as the Company did prior to the Closing. In the
event AHF changes its conduct and practices with the Company in such a manner
that has a material adverse impact on the Company, the Company will notify
Seller of such changes, and 20 days after giving such notice if AHF and the
Company
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have not resolved the change that caused the material adverse impact or, if
after working with AHF, Seller has not reasonably resolved the change that
caused the material adverse impact or agreed to mitigate such material adverse
impact, the Company may exercise all the options available to it in the
agreement between AHF and the Company.
ARTICLE V.
INDEMNIFICATION
5.1 Indemnification by Seller. Seller hereby agrees to indemnify Buyer
and its affiliates and their respective officers, directors and shareholders
against and hold them harmless from any loss, liability, claim, damage or
expense (including reasonable legal fees and expenses) (a "Loss") suffered or
incurred by any such indemnified party as a consequence of any inaccuracy or
breach of, or nonfulfillment of, any representation, warranty, agreement or
covenant of Seller under this Agreement or any exhibit, certificate, document or
instrument required to be delivered pursuant hereto.
5.2 Indemnification by Buyer. Buyer hereby agrees to indemnify Seller
and its affiliates and their respective officers, directors and shareholders
against and hold them harmless from any loss, liability, claim, damage or
expense (including reasonable legal fees and expenses) (a "Loss") suffered or
incurred by any such indemnified party as a consequence of any inaccuracy or
breach of, or nonfulfillment of, any representation, warranty, agreement or
covenant of Buyer under this Agreement or any exhibit, certificate, document or
instrument required to be delivered pursuant hereto.
ARTICLE VI.
MISCELLANEOUS
6.1 Assignment. This Agreement and the rights hereunder shall not be
assignable or transferable by Buyer or Seller without the prior written consent
of the other party hereto. This Agreement shall inure to the benefit of, and be
binding upon and enforceable against, the successors and permitted assigns of
the respective parties hereto.
6.2 No Third-Party Beneficiaries. Except as otherwise specifically
provided in this Agreement, this Agreement is for the sole benefit of the
parties hereto and their permitted assigns and nothing herein expressed or
implied shall give or be construed to give to any person or entity, other than
the parties hereto and such assigns, any legal or equitable rights hereunder.
6.3 Survival of Representations. The representations, warranties and
indemnities in this Agreement shall survive the Closing and shall remain
enforceable to the extent provided herein for a period of one year unless
written notice of a breach of a representation or warranty or a claim for
indemnification is received by any party to this Agreement prior to the end of
such one year period, in which event the indemnification responsibility for such
claim shall survive until settled or finally determined. The one year limitation
in this Section shall not apply to Section 4.2 of this Agreement.
6.4 Expenses. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs or expenses,
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except as may otherwise be expressly provided in this Agreement. Any costs of
litigation required to enforce this Agreement will be borne by the losing party.
6.5 Amendments. No amendment to or modification of this Agreement shall
be effective unless it shall be in writing and signed by each of the parties
hereto.
6.6 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given (a) on the date of delivery if delivered
personally; (b) on the date of transmission if sent via facsimile transmission
to the facsimile number given below, and telephonic confirmation of receipt is
obtained promptly after completion of transmission; (c) on the date after
delivery to a reputable nationally recognized overnight courier service or (d)
three days after being mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
If to Buyer or the Company:
XXI Holding Co., Inc.
Suite 500, 607 Market Street
Knoxville, TN 37902
ATTN: Tim Williams
with copies to:
CMH Capital, Inc.
5000 Clayton Road
Maryville, Tennessee 37804
ATTN: Kevin Clayton
and
James W. Parris, Esq.
Bernstein, Stair & McAdams
Suite 600, 530 S. Gay Street
Knoxville, Tennessee 37902
If to Seller:
American Homestar Corporation
2450 South Shore Boulevard, Suite 300
League City, TX 77573
Attention: Executive Vice President and
Chief Financial Officer
and
American Homestar Corporation
2221 E. Lamar Blvd., Suite 790
Arlington, TX 76006
Attention: Chief Executive Officer
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with a copy to:
Richard F. Dahlson, Esq.
Jackson Walker L.L.P.
Suite 6000, 901 Main Street
Dallas, TX 75202
Such addresses may be changed from time to time by means of a notice given in
the manner provided in this Section (provided that no such notice shall be
effective until it is received by the other parties hereto).
6.7 Severability. If any provision of this Agreement or the application
of any such provision to any person or circumstance shall be held invalid,
illegal or unenforceable in any respect by a court of competent jurisdiction,
such invalidity, illegality or unenforceability shall not affect any other
provision hereof.
6.8 Interpretation. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. The parties acknowledge and agree that (i)
each party and its counsel have reviewed and negotiated the terms and provisions
of this Agreement and have contributed to its revision, (ii) the normal rule of
construction, to the effect that any ambiguities are resolved against the
drafting party, shall not be employed in the interpretation of it, and (iii) the
terms and provisions of this Agreement shall be constructed fairly as to all
parties hereto and not in favor of or against any party, regardless of which
party was generally responsible for the preparation of this Agreement.
6.9 Waiver. Waiver of any term or condition of this Agreement by any
party shall be effective if in writing and shall not be construed as a waiver of
any subsequent breach or failure of the same term or condition, or a waiver of
any other term of this Agreement. No failure or delay by any party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
6.10 Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to the other parties.
6.11 Entire Agreement. This Agreement, including the Exhibits hereto,
contain the entire agreement and understanding between the parties hereto with
respect to the subject matter hereof and supersede all prior and contemporaneous
agreements, negotiations, correspondence, undertakings and understandings, oral
or written, relating to such subject matter.
6.12 Public Disclosure of Terms. Buyer and Seller will mutually agree
on a press release announcing this transaction. Thereafter, disclosures will be
made as required by law.
6.13 Governing Law. This Agreement shall be governed in all respects by
the laws of the State of Delaware.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date set forth above.
AMERICAN HOMESTAR CORPORATION
By: /s/ LAURENCE A. DAWSON JR.
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Title: President
XXI HOLDING CO., INC.
By: /s/ TIM WILLIAMS
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Title: President
21st CENTURY MORTGAGE CORPORATION
By: /s/ TIM WILLIAMS
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Title: President
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LIST OF EXHIBITS
Exhibit A - Limited Liability Company Agreement
Exhibit B - Revenue Sharing Agreement
Exhibit C - June 2000 Manufactured Home Dealer Agreement
Exhibit D - Amendment to Securityholders Agreement
Exhibit E - Settlement Statement
Schedule 1 - List of Unpaid obligations of Buyer to Seller
Schedule 2 - List of Repossessions to be Placed on Repo Line
Schedule 3 - List of Unpaid Obligations of Seller to Buyer
Exhibit F - Sales and Servicing Agreement
Exhibit G - 1995 Dealer Agreement Repossession Procedures
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EXHIBIT E
SETTLEMENT STATEMENT
FOR THE
PURCHASE OF 2,500,000 SHARES OF COMMON STOCK OF 21ST CENTURY
MORTGAGE CORPORATION
FROM
AMERICAN HOMESTAR CORPORATION
By
XXI HOLDING CO., INC.
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Purchase Price due Seller $ 6,300,000.00
ADJUSTMENTS:
Deduct from Proceeds Due Seller -
Investment in Homestar 21 JV, LLC (2,400,000.00)
Guaranty Deposit to 21st Century Mortgage
Corporation in accordance with Section 4.2(b) (1,000,000.00)
NET PROCEEDS DUE AMERICAN HOMESTAR CORPORATION $2,900,000.00
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