AGREEMENT FOR SALE OF DEBENTURES OF
NAL FINANCIAL GROUP, INC.
This Agreement is made and entered into by and between the undersigned
selling debenture holder ("Seller") and Conseco, Inc. ("Buyer").
RECITALS
A. The Seller is the present holder of certain convertible debentures
of NAL Financial Group, Inc. (the "Company") in the face amount of $2,750,000
(the "Debentures").
B. Seller desires to sell, and the Buyer desires to purchase, the
Debentures subject to the terms, provisions and conditions as hereinafter
provided.
AGREEMENT
NOW, THEREFORE, in consideration of the above Recitals and the mutual
covenants contained herein, and each act pursuant thereto the parties agree as
follows:
1. On the fifth business day immediately following the expiration of
the waiting period under the Xxxx-Xxxxx-Xxxxxx Act (the "Closing Date"), with
respect to a filing made by Buyer or its affiliates in connection with this
proposed transaction (the "Filing Approval"), the Seller shall sell and the
Buyer shall purchase all of the Debentures subject to the conditions hereinafter
stated.
2. This transaction is subject and conditioned upon obtaining the
Filing Approval no later than October 23, 1997. In the event such Filing
Approval is not obtained by October 23, 1997, the obligation of the Buyer and
the Seller hereunder shall terminate without any need for further act by the
parties. In addition, the following conditions must be satisfied prior to the
Closing Date, unless waived by Buyer:
(a) There shall have been no material adverse change in
Company's business as of August 19, 1997 and the Company shall not have
filed for bankruptcy protection under the United States Bankruptcy
Code.
(b) The Buyer shall obtain agreements of the other holders of
the Company's outstanding convertible debt to sell to the Buyer such
convertible debt.
(c) The Buyer shall have obtained any required approval of the
transfer of the Debentures from the Company, and any other party whose
approval is required to preclude the acceleration of indebtedness of
the Company.
3. The purchase price ("Purchase Price") for the Debenture shall be
$2,200,000, notwithstanding the face amount or principal and interest balance
thereof.. The Closing shall take place at the offices of counsel to the Company,
Xxxxxxxx Ingersoll, in Philadelphia on the Closing Date ("Closing"). The Buyer
shall provide the Seller prior written notice of the Closing Date of at least
five (5) business days prior to the Closing Date. At Closing, Seller shall
deliver to the Buyer the original Debentures, duly endorsed by an assignment
without recourse and such other instruments, in form and substance satisfactory
to the Seller, as the Buyer shall deem necessary to transfer such ownership of
the Debentures. On the Closing Date, Buyer shall deliver to Seller by wire
transfer in immediately available funds the full amount of the Purchase Price in
accordance with the payment instruction provided by Seller to Buyer.
4. The following shall be conditions to Seller's obligations to sell
hereunder:
(a) At Closing, the Company amend those certain warrants dated
September 12, 1996, issued to Xxxx & Co., as nominee for Xxxxxxx Xxxxx
Convertible Fund, Inc., in the amount of 34,375 shares of common stock
of the Company, and issued to Bridge Rope & Co., as nominee for Xxxxxxx
Xxxxx World Income Fund, Inc., in the amount of 28,125 shares of Common
Stock of the Company, so as to provide a strike price being adjusted to
one hundred percent (100%) of the closing bid price of the Company's
common stock, as reported on the principal exchange or automated
quotation system upon which the Company's common stock trades, on the
day of the Filing Approval, to comply with, and in lieu of, any further
adjustment right in Section 11.5 of the Warrants; and
(b) At Closing, the Company shall provide any required consent
to the transfer
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of the Debenture and waive any requirement for an opinion of counsel to
be provided of Seller (unless Buyer or Company provides such opinion).
5. Seller represents and warrants on the date hereon and as of Closing,
as follows:
(a) Seller will be the sole owner of the Debentures, which
shall not be converted prior to Closing on the date hereof and as of
Closing, and each of such Debentures shall be free and clear of the
liens, encumbrances, claims of others and transfer restrictions of any
kind;
(b) Seller has full power and authority to sell the Debentures
to the Buyer in accordance with the provisions hereof;
(c) This Agreement is a valid and binding obligation of the
Seller, enforceable in accordance with its terms, and the execution and
performance of this Agreement by the Seller will not result in any
violation of or be in conflict or constitute a default under any
contract, agreement, instrument, judgment, decree or other indenture to
which Seller is a party or by which Seller otherwise is bound;
(d) No persons, corporations or other entity has, nor as a
result of the transactions contemplated hereby will have, any right,
interest, or valid claim against the Seller, the Buyer or the Company
for the commission, fee or other compensation as a finder or broker or
any similar capacity arising out of any action taken by Seller; and
(e) The Seller is a sophisticated seller with respect to the
Debentures, has adequate information concerning the business and
financial condition of the Company to make an informed decision
regarding the sale of the Debentures, and has independently, without
reliance upon the Buyer, and based upon such information as it deemed
appropriate, made its own analysis and decision to enter into this
Agreement, and the Seller acknowledges and agrees that the Buyer may
possess material information with respect to the Company not known to
the Seller (the "Buyer Information"), that the Seller has not requested
the Buyer Information and the Buyer shall have no liability to the
Seller with respect to the non-disclosure of the Buyer Information.
6. The Buyer hereby represents and warrants as follows on the date
hereof and as of the Closing:
(a) This Agreement is a valid and binding obligation of the
Buyer, enforceable in accordance with its terms, and the execution and
performance of this Agreement by the Buyer will not result in any
violation of or be in conflict with or constitute a default under any
contract, agreement, instrument, judgment, decree or other indenture to
which the Buyer is a party or by which the Buyer
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otherwise is bound;
(b) No person, corporation or other entity has, nor as a
result of the transactions contemplated hereby will have, any right,
interest or valid claim against the Seller, the Buyer or the Company
for any commission, fee or any other compensation as a finder or broker
or in any similar capacity arising out of any action taken by the
Buyer;
(c) The Buyer has the power and legal right to buy the
Debentures from the Seller in accordance with the provisions hereof;
(d) To the Buyer's actual knowledge, no proceedings are
pending against the Buyer before any court, arbitrator, or
administrative or governmental body, which would have a material
adverse effect on any action taken or to be taken by the Buyer under
this Agreement;
(e) The Buyer is a sophisticated buyer and an accredited
investor within the meaning of Rule 501 of the Securities Act of 1933
with respect to the Debentures, has adequate information concerning the
business and financial condition of the Company to make an informed
decision regarding the purchase of the Debentures, and has
independently, without reliance upon the Seller, and based upon such
information as it deemed appropriate, made it own analysis and decision
to enter into this Agreement, and the Buyer acknowledges and agrees
that the Seller may possess material information with respect to the
Company not known to the Buyer (the "Seller Information"), that the
Buyer has not requested the Seller Information and the Seller shall
have no liability to the Buyer with respect to the non-disclosure of
the Seller Information;
(f) The Buyer has made such examinations, reviews and
investigations of the facts and circumstances necessary to evaluate the
purchase of the Debentures as the Buyer has deemed necessary or
appropriate;
(g) The Buyer has made its own credit determination and
analysis based upon such information as the Buyer deemed sufficient to
enter into this Agreement and not based on any statements or
representations by the Seller, except for those statements and
representations expressly set forth herein;
(h) The sale of the Debentures hereunder is made without
recourse, representation or warranty of any kind, except for those
representations and warranties expressly set forth herein;
(i) No "Benefit Plan", as such is defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended, is
purchasing any interest in the Debentures;
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(j) No consents, notices filings, approvals or authorizations
on behalf of the Buyer are required to be made to or with or received
from any person or governmental body for the sale of the Debentures and
the consummation of the transactions contemplated by this Agreement
except as may be referenced in the conditions of this Agreement; and
(k) The Buyer is purchasing the Debentures for its own account
and the Buyer is not purchasing the Debentures for resale in a manner
that violate applicable securities laws, provided that this subsection
6(k) shall not limit the ability of the Buyer to sell, assign or
transfer the Debentures, in whole or in part, in accordance with
applicable law, the Debentures and this Agreement.
7. Each of the Seller and the Buyer acknowledge and represent and
warrant to each other that (a) neither party has made any representation or
warranty, either express or implied, of any character, except for those
representations and warranties expressly set forth herein, and (b) upon Closing
the sale of the Debentures to the Buyer is irrevocable.
8. This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes and merges all prior
understandings and agreements concerning the subject matter hereof. This
Agreement may only be modified or amended in writing.
9. This Agreement may be executed in counterparts, each one of which
shall constitute one and the same agreement and each one of which shall be
deemed an original. This Agreement may be executed and delivered via facsimile.
10. Each of the Seller and the Buyer shall bear its own costs and
expenses in connection with the closing of the transactions contemplated by this
Agreement.
11. Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law.
If any provision contained in this Agreement is held to be prohibited by or
invalid under applicable law, such provision shall be
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ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
12. Neither the Seller nor the Buyer may assign this Agreement or any
of their rights or obligations under this Agreement without the prior written
consent of the other party, which consent shall be given in the sole discretion
of such party; provided, however, that Buyer may transfer this Agreement to any
of its wholly owned subsidiaries provided that such transferee assumes all
obligations, representations and warranties herein, and provides Seller with
reasonable evidence that transferee complies with all representations and
warranties in Section 6 hereof.
13. This Agreement shall be construed in accordance with and be
governed by the law of the State of New York. Each of the Seller and the Buyer
hereby irrevocably consents to the nonexclusive jurisdiction of the United
States Court for the Southern District of New York and the courts of the State
of New York located in the City of New York in any action to enforce, interpret
or construe any provision of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
CONSECO, INC.
By: /s/ XXXXXX X. XXXXX
_________________________________
Printed: Xxxxxx X. Xxxxx
Title: Executive Vice President
"BUYER"
XXXXXXX XXXXX CONVERTIBLE
FUND, INC.
By: /s/ XXXXXX XXXXXXXXX
__________________________________
Printed: Xxxxxx Xxxxxxxxx
Title: Vice President
