Common Stock Purchase Agreement [Supplement] - Turnkey Computer Systems Inc., Stephen W. Myers, Don Flynt, Carey Coffman and eMerge Interactive Inc.
SUPPLEMENT TO
COMMON STOCK PURCHASE AGREEMENT
This Supplement to Common Stock Purchase Agreement (the "Supplement")
is made and entered into as of October 1, 2000, by and among Turnkey Computer
Systems, Inc., a Texas corporation (the "Company"), Stephen W. Myers ("Myers"),
Don Flynt ("Flynt"), Carey Coffman ("Coffman") (collectively, the
"Shareholders") and eMerge Interactive, Inc., a Delaware corporation (the
"Investor").
RECITALS
1. The Investor and the Company previously have entered into that
certain Common Stock Purchase Agreement dated as of August 16, 1999 (the
"Agreement").
2. Pursuant to the Agreement, the Investor has purchased an aggregate
of 16,506 shares of the Company's Common Stock for an aggregate purchase price
of $1,900,000 (which Shares represented 19% of the issued and outstanding shares
of the Company following such issuance).
3. The Investor and the Company now desire to supplement the Agreement
to provide for (a) the issuance and sale to the Investor of additional Shares,
where the terms and conditions of the issuance and sale shall be subject to the
terms of the Agreement as if part of the Agreement, except as modified by this
Supplement, and (b) the sale to the Investor by the Shareholders of shares of
Company Common Stock which will considered "Shares" for purposes of the
Agreement and will be pursuant to the terms of this Supplement and the
Agreement.
AGREEMENT
In consideration of the foregoing and the mutual agreements contained
in this Supplement, the parties agree to supplement and amend the Agreement as
follows:
1. ISSUANCE AND SALE OF ADDITIONAL SHARES.
A. Sale of Additional Shares by Company. Subject to the terms and
conditions of this Supplement and the Agreement, the Investor agrees to purchase
from the Company on the date of this Supplement (which date will be an
"Additional Closing" as set forth in the Agreement), and the Company agrees to
sell and issue to the Investor at the Additional Closing, an aggregate of 5,030
shares of the Company's Common Stock for an aggregate purchase price of
$575,000.00. The purchase price for the Shares purchased from the Company will
be paid at the Additional Closing by wire transfer in immediately available
funds. At the Additional Closing, the Company shall deliver to the Investor one
or more certificates, representing the aggregate number of Shares to be
purchased by the Investor.
B. Sale of Additional Shares by Shareholders. Subject to the
terms and conditions of this Supplement and the Agreement, the Investor agrees
to purchase from the Shareholders at the Additional Closing, and the
Shareholders agree to sell to the Investor at the Additional Closing, shares of
the Company's Common Stock as follows: (i) Myers agrees to sell 2,415 shares for
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aggregate purchase price of $275,527.32; (ii) Flynt agrees to sell 1,810 shares
for an aggregate purchase price of $207,236.34; and (iii) Coffman agrees to sell
1,810 shares for an aggregate purchase price of $207,236.34. The purchase price
for the Shares purchased from the Shareholders will be paid at the Additional
Closing by wire transfer in immediately available funds. At the Additional
Closing, each Shareholder shall deliver to the Investor one or more
certificates, representing the aggregate number of Shares to be purchased by the
Investor. Each certificate shall be accompanied by a stock power in blank,
executed by the Shareholder and dated as of the date of this Supplement.
C. Dilution Protection. The Company and the Shareholders
acknowledge and agree that the 11,065 Shares purchased from the Company and the
Shareholders under this Supplement, together with the 16,506 Shares currently
owned by the Investor, represent 30% of the issued and outstanding shares of the
Company following such issuance and will be "Shares" as set forth in the
Agreement. Accordingly, for purposes of Section 8.1 of the Agreement, the
parties acknowledge that the purchases made by Investor under the Agreement and
this Supplement constitutes an investment in 30% of the issued and outstanding
capital stock of the Company, and shall be subject to the provisions of that
Section.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND MYERS.
With respect to the Shares purchased by the Investor from the Company,
the Company and Myers jointly and severally represent and warrant to the
Investor as of the date of this Supplement as follows:
A. Corporate Power. The Company has all requisite legal and
corporate power and authority (i) to execute and deliver this Supplement and the
other agreements contemplated herein; (ii) to issue and sell the Shares; and
(iii) to carry out and perform its other obligations under the terms of this
Supplement and the other agreements contemplated herein.
B. Authorization. All corporate action on the part of the Company
and its directors, officers and shareholders necessary for the authorization,
execution, delivery and performance of all obligations of the Company under this
Supplement and the other agreements contemplated herein has been taken. This
Supplement and all documents executed pursuant to this Supplement constitute
valid, legal and binding obligations of the Company and are enforceable in
accordance with their respective terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization or other laws relating to or affecting
the enforcement of creditors' rights generally, and except that the availability
of the remedy of specific performance or other equitable relief is subject to
the discretion of the court before which any proceeding therefor may be brought.
C. Disclosure. No representation or warranty by the Company in
this Supplement or in any statement, business plan or certificate furnished or
to be furnished to the Investor pursuant to this Supplement or in connection
with the transactions contemplated by this Supplement, contains or will contain
any untrue statement of a material fact or omits or will omit to state a
material fact necessary to make the statements made not misleading in light of
the circumstances under which they were made.
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D. Governmental Consents, etc. No consent, approval, order or
authorization of, or registration, declaration, designation, qualification or
filing with, any governmental authority on the part of the Company is required
in connection with the valid execution and delivery of this Supplement, the
offer, sale or issuance of the Shares or the consummation of any other
transaction contemplated hereby, except for such filings as may be required
under applicable state securities laws. Based in part on the representations of
the Investor set forth in Section 4 of the Agreement, the offer, sale and
issuance of the Shares in conformity with the terms of this Supplement are
exempt from the registration and prospectus delivery requirements of the
Securities Act and all securities laws of the State of Texas.
E. Brokerage or Finder's Fees. The Company has not incurred any
obligation or liability for brokerage commissions, finder's fees or similar
compensation in connection with the transactions contemplated by this Supplement
based on any arrangement or agreement made by the Company.
F. Capitalization. Except for the Shares previously issued to the
Investor, the capitalization of the Company is as provided in the Agreement.
Following the transactions contemplated by this Supplement, all of the issued
and outstanding capital stock of the Company will be held as follows: (i) 60,917
shares by Myers; (ii) 27,571 shares by the Investor; (iii) 1,708 shares by
Flynt; and (iv) 1,708 shares by Coffman.
G. Representations and Warranties in Agreement. All of the
representations and warranties of the Company contained in the Agreement are
true and correct as though made as of the date of this Supplement, except as set
forth on the Disclosure Schedule attached to this Supplement, if any.
3. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS.
With respect to the Shares purchased by the Investor from the
Shareholders, each Shareholder severally, but not jointly, represents and
warrants to the Investor as of the date of this Supplement as follows:
A. Authorization; Enforceability. The Shareholder is authorized
to execute, deliver and perform of all of its obligations under this Supplement
and the other agreements contemplated herein. This Supplement and all documents
executed pursuant to this Supplement constitute valid, legal and binding
obligations of the Shareholder and are enforceable in accordance with their
respective terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or other laws relating to or affecting the
enforcement of creditors' rights generally, and except that the availability of
the remedy of specific performance or other equitable relief is subject to the
discretion of the court before which any proceeding therefor may be brought.
B. Title to Shares. The Shareholder has good and marketable title
to the Shares, free and clear of any liens, mortgages, pledges, security
interests, charges, encumbrances or contractual obligations of any kind, and the
Shares are not subject to any preemptive rights, rights of first refusal or
redemption rights.
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C. Brokerage or Finder's Fees. The Shareholder has not incurred
any obligation or liability for brokerage commissions, finder's fees or similar
compensation in connection with the transactions contemplated by this Agreement
based on any arrangement or agreement made by the Shareholder.
4. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.
The Investor represents and warrants to the Company as of the date of
this Supplement as follows:
A. Authorization. The Investor has requisite power and authority
to enter into this Supplement and all other agreements, documents or instruments
contemplated by this Supplement and this Supplement constitutes its valid, legal
and binding obligation, enforceable in accordance with its terms, except as may
be limited by bankruptcy, insolvency, reorganization or other laws of general
application relating to or affecting the enforcement of creditors' rights
generally, and except that the availability of the remedy of specific
performance or other equitable relief is subject to the discretion of the court
before which any proceeding therefor may be brought.
B. Corporate Power. The Investor has all requisite legal and
corporate power and authority (i) to execute and deliver this Supplement and the
other agreements contemplated herein; (ii) to issue and sell the Investor
Shares; and (iii) to carry out and perform its other obligations under the terms
of this Supplement and the other agreements contemplated herein.
C. Brokerage or Finder's Fees. The Investor has not incurred any
obligation or liability for brokerage commissions, finder's fees or similar
compensation in connection with the transactions contemplated by this Supplement
based on any arrangement or agreement made by the Investor.
5. MISCELLANEOUS.
A. Incorporation and Status of Agreement. Except as modified by
the terms of this Supplement, the terms of the Agreement are incorporated in
this Supplement in their entirety. To the extent of a conflict between the
provisions of this Supplement and the provisions of the Agreement, the
provisions of this Supplement will control. Except as expressly amended or
waived herein, all terms, covenants and provisions of the Agreement are and
shall remain in full force and effect. All capitalized terms used in this
Supplement but not defined herein shall have the meanings set forth in the
Agreement.
B. Survival. The representations and warranties of the parties
made herein shall survive the closing of the transactions contemplated hereby.
C. Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the permitted successors, assigns, heirs, executors and administrators of
the Investors.
D. Entire Agreement; Amendment. This Supplement, the Agreement
and the other documents delivered pursuant hereto and thereto constitute the
full and entire understanding and
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agreement among the parties with regard to the subjects hereof and thereof. This
Supplement may be amended, waived, discharged or terminated only with the
written consent of the parties.
E. Brokerage and Finder's Fees. Each party will be responsible
for, and will indemnify and hold harmless the other parties for, any brokerage
commissions, finder's fees or similar compensation incurred by such party in
connection with the transactions contemplated by this Supplement.
F. Notices, etc. All notices and other communications required or
permitted hereunder shall be given as set forth in the Agreement, except that
any notice required to be provided to a Shareholder will be delivered to the
Company.
G. Expense of Transaction. Each party will bear its own expenses
in connection with the transaction described herein.
H. Counterparts. This Supplement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
I. Timely Performance. Time is of the essence as to the
performance of the obligations required of the respective parties under this
Supplement.
J. Attorney's Fees. If any action at law or in equity (including
arbitration) is necessary to enforce or interpret the terms of this Supplement,
the prevailing party shall be entitled to reasonable attorney's fees, costs and
necessary disbursements in addition to any other relief to which such party may
be entitled.
K. Severability. If one or more provisions of this Supplement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a) such
provision shall be excluded from this Supplement, (b) the balance of this
Supplement shall be interpreted as if such provision were so excluded and (c)
the balance of this Supplement shall be enforceable in accordance with its
terms.
L. Delays or Omission. No delay or omission to exercise any
right, power or remedy accruing to any party, upon any breach or default of any
party under this Supplement, shall impair any such right, power or remedy of
such party, nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character of
any breach, condition or default under this Supplement must be in writing and
shall be effective only to the extent specifically set forth in such writing.
All remedies, either under this Supplement or by law or otherwise afforded to
any holder, shall be cumulative and not alternative.
M. Remedies. In addition to any remedies the parties may have at
law or in equity, the parties shall have the remedies specified in the
Agreement.
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IN WITNESS WHEREOF, the Company, the Shareholders and the Investor have
executed and delivered this Supplement as of the day and year first above
written.
THE COMPANY:
Turnkey Computer Systems, Inc.
801 South Pierce Street
Amarillo, Texas 79101
By: /s/ Stephen W. Myers
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Name: Stephen W. Myers
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Title: President
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THE INVESTOR:
eMerge Interactive, Inc.
10315 102nd Terrace
Sebastian, Florida 32958
By: /s/ T. Michael Janney
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Name: T. Michael Janney
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Title: Chief Financial Officer
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THE SHAREHOLDERS:
/s/ Stephen W. Myers
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Stephen W. Myers
/s/ Don Flynt
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Don Flynt
/s/ Carey Coffman
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Carey Coffman
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