EXHIBIT 10.23
ACQUISITION AGREEMENT
BY AND BETWEEN
BRIGHT FINANCIAL CORPORATION
AND
MAXAMERICA FINANCIAL SERVICES, INC.
ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT ("Agreement"), dated as of August _____ 1999, is by
and between Bright Financial Corporation ("BRIGHT") Xxxxxx Xxxxxx ("Xxxxxx"), an
Individual, Xxxxxx Xxxxxx ("Elliot") an individual, and MaxAmerica Financial
Services, Inc., a California corporation ("MAXAMERICA"). Xxxxxx and Xxxxxx will
sometimes be referred to collectively as "Shareholders."
RECITALS
A. Shareholders own 100% of the issued and outstanding capital stock of
BRIGHT (the "Bright Shares").
B. Upon the terms and conditions set forth below, Shareholders desire to
sell to MAXAMERICA, and MAXAMERICA is willing to purchase from Shareholders, 60%
of the BRIGHT Shares, such that following such transaction, BRIGHT will be a
subsidiary of MAXAMERICA.
C. MAXAMERICA is a wholly owned subsidiary of HomeLife, Inc. a Nevada
corporation ("HomeLife").
D BRIGHT is doing business as Vintage Funding, Inc and Best Mortgage.
The operations of both dba's shall be included in this acquisition.
NOW, THEREFORE, in consideration of the mutual covenants, agreements,
representations and warranties contained in this Agreement, the parties hereto
agree as follows:
ARTICLE I
SALE AND ISSUANCE OF SHARES AND OTHER TERMS
1.1 PURCHASE PRICE. The purchase price shall be $600,000, paid for with
one-thousand-two-hundred (1,200) shares of Class AAA Preferred Stock of
HomeLife, Inc. These shares of Class AAA Preferred Stock shall have a face value
of $500 per share and be convertible into one-hundred-twenty-thousand (120,000)
shares of the common stock of HomeLife, Inc. after a period of 36 months form
the date of issue.
1.2 GUARANTEE OF VALUE. After conversion of the Class AA Preferred Stock
to common stock, HomeLIfe, Inc. will guarantee the value of the common shares at
a price of five dollars ($5.00) per share. If the market price per share of
HomeLIfe, Inc.'s common stock is less than five dollars ($5.00) per share upon
the sale of the stock by Shareholders, HomeLife, Inc. shall promptly issue to
Shareholders such additional shares of HomeLife Inc.'s common stock which
together with the initial shares shall have an aggregate market value equal to
five dollars ($5.00) times the amount of the initial shares.
1.3 CONVERSION OF PREFERRED STOCK. The value of each share of HomeLife,
Inc.'s common stock, for the purposes of conversion as described in paragraphs
1.1 and 1.2, shall be the average of the bid and ask price for the thirty days
prior to conversion.
1.4 ORDERLY SALE OF SHARES. After conversion of Preferred Stock to Common
Stock, Shareholders agree that collectively that Shareholders will not sell,
transfer, or dispose of more than twenty thousand (15,000) shares of common
stock within any 30 day period. Shareholders further agree that Buyer will be
first offered such shares for purchase, and in the event that Buyer does not
desire to purchase same, will allow Buyer to assist appropriately in the orderly
marketing, placement, re-registration, or sale of such stock.
1.5 CONVEYANCE OF BRIGHT SHARES. At Closing of this Agreement,
Shareholders will sell, assign, transfer and convey their respective right,
title and interest in 3,000 Bright Shares to MAXAMERICA, and MAXAMERICA shall
acquire 3,000 Bright Shares from the Shareholders. These 3,000 Bright Shares
represent 60% of the outstanding and issued shares of BRIGHT as of the date of
this Agreement.
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1.6 GUARANTEE OF PROFITS. Shareholders will guarantee that the net profit
of BRIGHT will be a minimum of $70,000 per year for the next three years. If the
net profit is less than $70,000 per year in any year for the next three years,
the purchase price will be reduced and recalculated according to the following
formula: ($600,000 / 3 x net profit / $70,000) for each year in which the net
profit is less than $70,000.
1.7 EMPLOYMENT AGREEMENT. MAXAMERICA will enter into employment agreement
with Xxxxxx and Elliot in the form attached hereto as Exhibit "B" ("Employment
Agreement").
1.8 EXCLUSIVE GEOGRAPHICAL RIGHTS. BRIGHT shall the exclusive right of
first refusal to underwrite any mortgage loan referred to MAXAMERICA from its
franchise operations or any other source in Southern California, defined as the
area south of San Xxxx Xxxxxx, California. MAXAMERICA and HomeLife, Inc., or any
of its subsidiary companies, agree not to purchase a loan brokerage company in
Southern California without the express written permission of Shareholders.
1.9 RIGHT OF FIRST REFUSAL. MAXAMERICA shall be offered the fight of first
refusal to purchase any or all of the remaining common stock of BRIGHT if this
stock is offered for sale by Shareholders to any third party.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS - Except as
disclosed in a document referring specifically to the representations and
warranties in this Agreement that identifies by section number the section and
subsection to which such disclosure relates and is delivered by Shareholders to
MAXAMERICA prior to the execution of this Agreement Exhibit "C" (the "BRIGHT
Disclosure Schedule"), the Shareholders each represent and warrant to
MAXAMERICA, as of the date hereof and as of the Closing, as follows:
2.1.1 ORGANIZATION. STANDING. POWER. BRIGHT is a corporation duly
organized, validly existing and in good standing under the laws of the State of
California. It has all requisite corporate power, franchises, licenses, permits
and authority to own its properties and assets and to carry on its business as
it has been and is being conducted. BRIGHT is duly qualified and in good
standing to do business in each jurisdiction in which a failure to so qualify
would have a Material Adverse Effect (as defined below) on BRIGHT. For purposes
of this Agreement, the term "Material Adverse Effect" means any change or effect
that, individually or when taken together with all other such changes or effects
which have occurred prior to the date of determination of the occurrence of the
Material Adverse Effect, is or is reasonably likely to be materially adverse to
the business, assets (including intangible assets), financial condition or
results of operations of the entity.
2.1.2 AUTHORITY. Shareholders have all requisite power and authority
to enter into this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery by Shareholders of this Agreement and the
consummation of the transactions contemplated hereby have been duly authorized
by all necessary action on the part of Shareholders, including the approval of
the Board of Directors of BRIGHT. This Agreement has been duly executed and
delivered by Shareholders and constitutes a valid and binding obligation of the
Shareholders enforceable in accordance with its terms, except that such
enforceability may be subject to (i) bankruptcy, insolvency, reorganization or
other similar laws relating to enforcement of creditors' rights generally, and
(ii) general equitable principles. Subject to the satisfaction of the conditions
set forth in Article 3 below, the execution and delivery of this Agreement do
not, and the consummation of the transactions contemplated hereby will not,
conflict with or result in any violation of, or default (with or without notice
or lapse of time, or both) under, or give rise to a right of termination,
cancellation or acceleration of any obligation or to loss of a material benefit
under, or the creation of a lien, pledge, security interest, charge or other
encumbrance on any assets of BRIGHT or any Shareholder (any such conflict,
violation, default, right, loss or creation being referred to herein as a
"Violation") pursuant to (i) any provision of the organization documents of any
Shareholder, or (ii) any loan or credit agreement, note, bond, mortgage,
indenture, contract, lease, or other agreement or instrument, permit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to or Shareholders' respective
properties or assets, other than, in the case of (ii), any such Violation which
individually or in the aggregate would not have a Material Adverse Effect on
Shareholders.
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2.1.3 CAPITALIZATION OF BRIGHT.
(a) The authorized equity securities of BRIGHT consists of
one-hundred-thousand (100,000) authorized shares and five-thousand (5,000)
issued and outstanding shares of BRIGHT common stock The issued and
outstanding shares of which are held by the Shareholders in the amounts as
specified on the BRIGHT Disclosure Schedule.
(b) All of the issued and outstanding Bright Shares have been duly and
validly issued, are fully paid and non-assessable, and were issued in accordance
with the registration or qualification provisions of the Securities Act of 1933,
as amended (the "Securities Act"), and any relevant state securities laws or
pursuant to valid exemptions therefrom. The Bright Shares are free of
restrictions on transfer other than restrictions on transfer as set forth in the
BRIGHT Disclosure Schedule and under applicable state and federal securities
laws.
(c) Except as set forth on the BRIGHT Disclosure Schedule, there are
no options, warrants, rights, calls, commitments, plans, contracts or other
agreements of any character granted or issued by BRIGHT which provide for the
purchase, issuance or transfer of any additional shares of the capital stock of
BRIGHT nor are there any outstanding securities granted or issued by BRIGHT that
are convertible into any shares of the equity securities of BRIGHT, and none is
authorized. BRIGHT does not have outstanding any bonds, debentures, notes or
other indebtedness the holders of which have the right to vote (or convertible
or exercisable into securities having the right to vote) with holders of BRIGHT
capital stock on any matter.
(d) Except as set forth on the BRIGHT Disclosure Schedule, BRIGHT is
not a party or subject to any agreement or understanding, and, to the best of
BRIGHT's knowledge, there is no agreement or understanding between any persons
and/or entities, which affects or relates to the voting or giving of written
consents with respect to any security or by a director of BRIGHT.
(e) Except as set forth on the BRIGHT Disclosure Schedule, BRIGHT has
not granted or agreed to grant any registration rights, including piggyback
rights, to any person or entity.
2.1.4 NO DEFAULTS. BRIGHT is not, and has not received notice that it
would be with the passage of time, in default or violation of any term,
condition or provision of (i) the Articles of Incorporation or Bylaws of BRIGHT,
(ii) any judgment, decree or order applicable to BRIGHT, or (iii) any loan or
credit agreement, note, bond, mortgage, indenture, contract, agreement, lease,
license, or other instrument to which BRIGHT is now a party or by which it or
any of its properties or assets may be bound, except for defaults and violations
which, individually or in the aggregate, would not have a Material Adverse
Effect on BRIGHT.
2.1.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of or registration, qualification, designation, declaration or
filing with or exemption by (collectively "Consents"), any court, administrative
agency or commission or other federal, state or local governmental authority or
instrumentality, whether domestic or foreign (each a "Governmental Entity"), is
required by or with respect to BRIGHT in connection with the execution and
delivery of this Agreement or the consummation by BRIGHT of the transactions
contemplated hereby, except for such Consents which if not obtained or made
would not have a Material Adverse Effect on BRIGHT or the transactions
contemplated by this Agreement.
2.1.6 FINANCIAL STATEMENTS. BRIGHT has furnished MAXAMERICA with a
true and complete copy of its audited financial statements for the period ending
December 31, 1998 (the "BRIGHT Financial Statements"), which comply as to form
in all material respects with all applicable accounting requirements with
respect thereto and have been prepared internally and fairly present the
financial position of BRIGHT as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
audited statements, to normal, recurring audit adjustments not material in scope
or amount). There has been no change in BRIGHT's accounting policies or the
methods of making accounting estimates or changes in estimates that are material
to BRIGHT Financial Statements, except as described in the notes thereto. BRIGHT
will also provide to MAXAMERICA a HUD (Department of Housing and Urban
Development) audit for the period ending December 31, 1998 and December 31,
1997.
2.1.7 ABSENCE OF UNDISCLOSED LIABILITIES. BRIGHT has no liabilities or
obligations (whether absolute, accrued or contingent) except (i) liabilities
that are accrued or reserved against in the BRIGHT Financial
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Statements as of December 31, 1998 or reflected in the notes thereto or (ii)
additional liabilities reserved against since December 31, 1998 that have
arisen in the ordinary course of business; are accrued or reserved against on
the books and records of BRIGHT; and amount in the aggregate to less than
$10,000.
2.1.8 ABSENCE OF CHANGES. Since December 31, 1998 and until closing of
this agreement, BRIGHT has conducted its business in the ordinary course and
there has not been: (i) any Material Adverse Effect on the business, financial
condition, liabilities, or assets of BRIGHT or any development or combination of
developments of which management of BRIGHT has knowledge which is reasonably
likely to result in such an effect; (ii) any damage, destruction or loss,
whether or not covered by insurance, having a Material Adverse Effect on BRIGHT;
(iii) any declaration, setting aside or payment of any dividend or other
distribution (whether in cash, stock, or property) with respect to the capital
stock of BRIGHT; (iv) any increase or change in the compensation or benefits
payable or to become payable by BRIGHT to any of its employees, except in the
ordinary course of business consistent with past practice; (v) any sale, lease,
assignment, disposition, or abandonment of a material amount of property of
BRIGHT, except in the ordinary course of business; (vi) any increase or
modification in any bonus, pension, insurance or other employee benefit plan,
payment or arrangement made to, for, or with any of its employees; (vii) the
granting of stock options, restricted stock awards, stock bonuses, stock
appreciation rights and similar equity based awards; (viii) any resignation or
termination of employment of any officer of BRIGHT; and BRIGHT, to the best of
its knowledge, does not know of the impending resignation or termination of
employment of any such officer; (ix) any merger or consolidation with another
entity, or acquisition of assets from another entity except in the ordinary
course of business; (x) any loan or advance by BRIGHT to any person or entity,
or guaranty by BRIGHT of any loan or advance; (xi) any amendment or termination
of any contract, agreement, or license to which BRIGHT is a party, except in the
ordinary course of business; (xii) any mortgage, pledge, or other encumbrance of
any asset of BRIGHT; (xiii) any waiver or release of any right or claim of
BRIGHT, except in the ordinary course of business; (xiv) any write off as
uncollectible any note or account receivable or portion thereof-, or (xv) any
agreement by BRIGHT to do any of the things described in this Section.
2.1.9 PATENTS AND TRADEMARKS. BRIGHT has sufficient title and
ownership of all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information, proprietary rights and processes (collectively,
"Intellectual Property"), if any, necessary for its business as now conducted
without any conflict with or infringement of the rights of others. The
Intellectual Property owned by BRIGHT is listed in the BRIGHT Disclosure
Schedule. There are no outstanding options, licenses, or agreements of any
kind relating to the Intellectual Property, nor is BRIGHT bound by or a party
to any options, licenses or agreements of any kind with respect to the
Intellectual Property of any other person or entity. BRIGHT has not received
any communications alleging that BRIGHT has violated or, by conducting its
business as proposed, would violate any of the Intellectual Property of any
other person or entity. BRIGHT is not aware that any of its employees is
obligated under any contract (including licenses, covenants or commitments of
any nature) or other agreement, or subject to any judgment, decree or order
of any court or administrative agency, that would interfere with the use of
his or her best efforts to promote the interests of BRIGHT or that would
conflict with BRIGHT's business as proposed to be conducted. Neither the
execution or delivery of this Agreement, nor the carrying on of BRIGHT's
business by the employees of BRIGHT, nor the conduct of BRIGHT's business as
proposed, will, to the best of BRIGHT's knowledge, conflict with or result in
a breach of the terms, conditions or provisions of, or constitute a default
under, any contract, covenant or instrument under which any of such employees
is now obligated. BRIGHT does not believe it is or will be necessary to
utilize any inventions of any of its employees (or people it currently
intends to hire) made prior to their employment by BRIGHT.
2.1.10 EMPLOYEE BENEFIT PLANS. All employee benefit plans (including
without limitation all plans which authorize the granting of stock options,
restricted stock, stock bonuses or other equity based awards) covering active,
former or returned employees of BRIGHT are listed in the BRIGHT Disclosure
Schedule.
2.1.11 OTHER PERSONAL PROPERTY. The books and records of BRIGHT
contain a complete and accurate description, and specify the location, of all
trucks, automobiles, machinery, equipment, furniture, supplies and other
tangible personal property owned by, in the possession of, or used by BRIGHT in
connection with its business. Except as set forth in the BRIGHT Disclosure
Schedule, no personal property used by BRIGHT in connection with its business is
held under any lease, security agreement, conditional sales contract, or other
title retention or security arrangement.
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2.1.12 MAJOR CONTRACTS. Except as otherwise disclosed in the BRIGHT
Disclosure Schedule, BRIGHT is not a party or subject to:
(a) Any union contract, or any employment contract or arrangement
providing for future compensation, written or oral, with any officer,
consultant, director or employee which is not terminable by BRIGHT on 30 days'
notice or less without penalty or obligations to make payments related to such
termination;
(b) Any joint venture contract, partnership agreement or arrangement
or any other agreement which has involved or is expected to involve a sharing of
revenues with other persons or a joint development of products with other
persons;
(c) Any production, distribution, sales, franchise, marketing or
license agreement or arrangement by which products or services of BRIGHT are
developed, sold or distributed;
(d) Any material agreement, license, franchise, permit, indenture or
authorization which has not been terminated or performed in its entirety and not
renewed which may be, by its terms, accelerated, terminated, impaired or
adversely affected by reason of the execution of this Agreement, or the
consummation of the transactions contemplated hereby or thereby;
(e) Any material agreement, contract or commitment that requires the
consent of another person for BRIGHT; to enter into or consummate the
transactions contemplated by this Agreement;
(f) Any contract containing covenants purporting to materially limit
BRIGHT' freedom to compete in any line of business in any geographic area.
2.1.13 LEASES IN EFFECT. All real property leases and subleases and
any amendments or modifications thereof (each a "Lease" and, collectively, the
"Leases") as to which BRIGHT is a party are listed in the BRIGHT Disclosure
Schedule and are valid, in full force and effect and enforceable, and there are
no existing defaults on the part of BRIGHT, and BRIGHT has not received nor
given notice of default or claimed default with respect to any Lease, nor is
there any event that with notice or lapse of time, or both, would constitute a
default thereunder. Except as set forth on the BRIGHT Disclosure Schedule, no
consent is required from any party under any Lease in connection with the
completion of the transactions contemplated by this Agreement, and BRIGHT has
not received notice that any party to any Lease intends to cancel, terminate, or
refuse to renew the same or to exercise any option or other right thereunder,
except where the failure to receive such consent, or where such cancellation,
termination or refusal, would not have a Material Adverse Effect on BRIGHT.
2.1.14 TAXES. Except as set forth elsewhere in this Agreement or in
the BRIGHT; Disclosure.
(a) All taxes, assessments, fees, penalties, interest and other
governmental charges with respect to BRIGHT which have become due and payable as
of the date of Closing will be paid in full or adequately reserved against by
BRIGHT, and all taxes, assessments, fees, penalties, interest and other
governmental charges which have become due and payable subsequent to the date of
Closing have been paid in full or adequately reserved against on its books of
account and such books are sufficient for the payment of all unpaid federal,
state, local, foreign and other taxes, fees and assessments (including without
limitation, income, property, sales, use, franchise, capital stock, excise,
added value, employees' income withholding, social security and unemployment
taxes), and all interest and penalties thereon with respect to the periods then
ended and for all periods prior thereto;
(b) There are no agreements, waivers or other arrangements providing
for an extension of time with respect to the assessment of any tax or deficiency
against BRIGHT, nor are there any actions, suits, proceedings, investigations or
claims now pending against BRIGHT in respect of any tax or assessment, or any
matters under discussion with any federal, state, local or foreign authority
relating to any taxes or assessments, or any claims for additional taxes or
assessments asserted by any such authority; and
(c) There are no liens for taxes upon the assets of BRIGHT except for
taxes that are not yet payable. BRIGHT has withheld all taxes required to be
withheld in respect of wages, salaries and other payments to all employees,
officers and directors and timely paid all such amounts withheld to the proper
taxing authority.
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2.1.15 DISPUTES AND LITIGATION. Except as disclosed in the BRIGHT
Disclosure Schedule, there is no suit, claim, action, litigation, or proceeding
pending or, to the knowledge of BRIGHT, threatened against or affecting BRIGHT
or any of its properties, assets or business or to which BRIGHT is a party, in
any court or before any arbitrator of any kind or before or by any Governmental
Entity, which would, if adversely determined, individually or in the aggregate,
have a Material Adverse Effect on BRIGHT, nor is there any judgment, decree,
injunction, rule or order of any Governmental Entity or arbitrator outstanding
against BRIGHT having, or which, insofar as reasonably can be foreseen, in the
future could have, any such effect. To the knowledge of BRIGHT, there is no
investigation pending or threatened against BRIGHT before any foreign, federal,
state, municipal or other governmental department, commission, board, bureau,
agency, instrumentality or other Governmental Entity.
2.1.16 COMPLIANCE WITH LAWS. Except as set forth in the BRIGHT
Disclosure Schedule, BRIGHT's business is not being conducted in violation of,
or in a manner which could cause liability under any applicable law, rule or
regulation, judgment, decree or order of any Governmental Entity, except for any
violations or practices, which, individually or in the aggregate, have not had
and will not have a Material Adverse Effect on BRIGHT. BRIGHT has all
franchises, permits, licenses, and any similar authority necessary for the
conduct of its business as now being conducted by it, the lack of which could
materially and adversely affect the business, properties, prospects, or
financial condition of BRIGHT, and the believes it can obtain, without undue
burden or expense, any similar authority for the conduct of its business as it
is planned to be conducted. BRIGHT is not in default in any material respect
under any of such franchises, permits, licenses or other similar authority. A
true and complete list of all such franchises, permits, and licenses held by
BRIGHT is set forth in the BRIGHT Disclosure Schedule.
2.1.17 RELATED PARTY TRANSACTIONS. No employee, officer, or director
of BRIGHT or member of his or her immediate family is indebted to BRIGHT, nor is
BRIGHT indebted (or committed to make loans or extend or guarantee credit) to
any of them except as disclosed in the BRIGHT Disclosure Schedule. To the best
of BRIGHT's knowledge, none of such persons has any direct or indirect ownership
interest in any firm or corporation with which BRIGHT; is affiliated or with
which BRIGHT has a business relationship, or any firm or corporation that
competes with BRIGHT, except that employees, officers or directors of BRIGHT and
members of their immediate families may own stock in publicly traded companies
that may compete with BRIGHT. To BRIGHT's knowledge, no member of the immediate
family of any officer or director of BRIGHT is directly or indirectly interested
in any material contract with BRIGHT.
2.1.18 INSURANCE. The BRIGHT Disclosure Schedule sets forth a true and
complete list of all insurance policies maintained by BRIGHT concerning its
business and properties. BRIGHT has in full force and effect fire and casualty
insurance policies, with extended coverage, sufficient in amount (subject to
reasonable deductibles) to allow it to replace any of its properties that might
be damaged or destroyed.
2.1.19 MINUTE BOOKS. The minute books of BRIGHT provided to MAXAMERICA
contain a complete summary of all meetings of directors and shareholders since
the time of incorporation and reflect all transactions referred to in such
minutes accurately in all material respects.
2.1.20 DISCLOSURE. No representation or warranty made by BRIGHT in
this Agreement, nor any document, written information, statement, financial
statement, certificate or exhibit prepared and furnished or to be prepared and
furnished by BRIGHT or their representatives pursuant hereto or in connection
with the transactions contemplated hereby, when taken together, contains any
untrue statement of a material fact, or omits to state a material fact necessary
to make the statements or facts contained herein or therein not misleading in
light of the circumstances under which they were furnished.
2.1.21 RELIANCE. The foregoing representations and warranties are made
by BRIGHT with the knowledge and expectation that MAXAMERICA is placing reliance
thereon.
2.2 REPRESENTATIONS AND WARRANTIES OF MAXAMERICA. Except as disclosed
in a document referring specifically to the representations and warranties in
this Agreement that identifies by section number the section and subsection to
which such disclosure relates and is delivered by MAXAMERICA to Shareholders
prior to the execution of this Agreement as shown in Exhibit "C" (the
"MAXAMERICA Disclosure Schedule"), MAXAMERICA represents and warrants to
Shareholders, as of the date hereof and as of the Closing, as follows:
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2.2.1 ORGANIZATION. STANDING. POWER. MAXAMERICA is a corporation duly
organized, validly existing and in good standing under the laws of the State of
California. It has all requisite corporate power, franchises, licenses, permits
and authority to own its properties and assets and to carry on its business as
it has been and is being conducted. MAXAMERICA is duly qualified and in good
standing to do business in each jurisdiction in which it operates.
2.2.2 AUTHORITY. MAXAMERICA has all requisite corporate power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery by MAXAMERICA of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized by all necessary corporate action on the part of MAXAMERICA,
including the approval of the Board of Directors and the stockholders of
MAXAMERICA. This Agreement has been duly executed and delivered by MAXAMERICA
and constitutes a valid and binding obligation of MAXAMERICA enforceable in
accordance with its terms, except that such enforceability may be subject to (i)
bankruptcy, insolvency, reorganization or other similar laws relating to
enforcement of creditors' rights generally, and (ii) general equitable
principles. Subject to the satisfaction of the conditions set forth in Article
3, the execution and delivery of this Agreement do not, and the consummation of
the transactions contemplated hereby will not, conflict with or result in any
Violation pursuant to (i) any provision of the Articles of Incorporation or
Bylaws of MAXAMERICA or (ii) any loan or credit agreement, note, bond, mortgage,
indenture, contract, lease, or other agreement or instrument, pen-nit,
concession, franchise, license, judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to MAXAMERICA or its properties or
assets, other than, in the case of (ii), any such Violation which individually
or in the aggregate would not have a Material Adverse Effect on MAXAMERICA.
2.2.3 CAPITALIZATION OF MAXAMERICA.
(a) The authorized equity securities of MAXAMERICA consists of
1,000,000 shares of MAXAMERICA common stock, par value $.001, of which 10,000
are issued and outstanding as of May 31, 1999.
(b) All of the issued and outstanding shares of MAXAMERICA capital
stock have been duly and validly issued, are fully paid and non-assessable, and
were issued in accordance with the registration or qualification provisions of
the Securities Act and any relevant state securities laws or pursuant to valid
exemptions therefrom. The MAXAMERICA Shares are free of restrictions on transfer
other than restrictions on transfer as set forth in the MAXAMERICA Disclosure
Schedule and under applicable state and federal securities laws.
(c) Except as set forth on the MAXAMERICA Disclosure Schedule, there
are no options, warrants, rights, calls, commitments, plans, contracts or other
agreements of any character granted or issued by MAXAMERICA which provide for
the purchase, issuance or transfer of any additional shares of the capital stock
of MAXAMERICA nor are there any outstanding securities granted or issued by
MAXAMERICA that are convertible into any shares of the equity securities of
MAXAMERICA, and none is authorized. MAXAMERICA does not have outstanding any
bonds, debentures, notes or other indebtedness the holders of which have the
right to vote (or convertible or exercisable into securities having the right to
vote) with holders of MAXAMERICA capital stock on any matter.
(d) Except as set forth on the MAXAMERICA Disclosure Schedule,
MAXAMERICA is not a party or subject to any agreement or understanding, and, to
the best of MAXAMERICA's knowledge, there is no agreement or understanding
between any persons and/or entities, which affects or relates to the voting or
giving of written consents with respect to any security or by a director of
MAXAMERICA.
(e) Except as set forth on the MAXAMERICA Disclosure Schedule,
MAXAMERICA has not granted or agreed to grant any registration rights, including
piggyback rights, to any person or entity.
2.2.4 NO DEFAULTS. MAXAMERICA is not, and has not received notice that
it would be with the passage of time, in default or violation of any term,
condition or provision of (i) the Articles of Incorporation or Bylaws of
MAXAMERICA, (ii) any judgment, decree or order applicable to MAXAMERICA, or
(iii) any loan or credit agreement, note, bond, mortgage, indenture, contract,
agreement, lease, license, or other instrument to which MAXAMERICA is now a
party or by which it or any of its properties or assets may be bound, except for
defaults and violations which, individually or in the aggregate, would not have
a Material Adverse Effect on MAXAMERICA.
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2.2.5 GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of or registration, qualification, designation, declaration or
filing with or exemption by (collectively "Consents"), any court, administrative
agency or commission or other federal, state or local governmental authority or
instrumentality, whether domestic or foreign (each a "Governmental Entity"), is
required by or with respect to MAXAMERICA in connection with the execution and
delivery of this Agreement or the consummation by MAXAMERICA of the transactions
contemplated hereby, except for such Consents which if not obtained or made
would not have a Material Adverse Effect on MAXAMERICA or the transactions
contemplated by this Agreement.
2.2.6 FINANCIAL STATEMENTS. MAXAMERICA has furnished BRIGHT with a
true and complete copy of its audited financial statements for the period ending
May 30, 1998 (the "MAXAMERICA Financial Statements"), which comply as to form in
all material respects with all applicable accounting requirements with respect
thereto and have been prepared internally and fairly present the financial
position of MAXAMERICA as at the dates thereof and the results of its operations
and cash flows for the periods then ended (subject, in the case of audited
statements, to normal, recurring audit adjustments not material in scope or
amount). There has been no change in MAXAMERICA's accounting policies or the
methods of making accounting estimates or changes in estimates that are material
to MAXAMERICA Financial Statements, except as described in the notes thereto.
2.2.7 ABSENCE OF UNDISCLOSED LIABILITIES. MAXAMERICA has no
liabilities or obligations (whether absolute, accrued or contingent) except (i)
liabilities that are accrued or reserved against in the MAXAMERICA Financial
Statements as of May 30, 1998, or reflected in the notes thereto or (ii)
additional liabilities reserved against since May 30, 1998 that have arisen in
the ordinary course of business; are accrued or reserved against on the books
and records of MAXAMERICA; and amount in the aggregate to less than $25,000.
2.2.8 PATENTS AND TRADEMARKS. MAXAMERICA has sufficient title and
ownership of all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information, proprietary rights and processes (collectively,
"Intellectual Property") necessary for its business as now conducted without any
conflict with or infringement of the rights of others. The Intellectual Property
owned by MAXAMERICA is listed in the MAXAMERICA Disclosure Schedule. There are
no outstanding options, licenses, or agreements of any kind relating to the
Intellectual Property, nor is MAXAMERICA bound by or a party to any options,
licenses or agreements of any kind with respect to the Intellectual Property of
any other person or entity. MAXAMERICA has not received any communications
alleging that MAXAMERICA has violated or, by conducting its business as
proposed, would violate any of the Intellectual Property of any other person or
entity. MAXAMERICA is not aware that any of its employees is obligated under any
contract (including licenses, covenants or commitments of any nature) or other
agreement, or subject to any judgment, decree or order of any court or
administrative agency, that would interfere with the use of his or her best
efforts to promote the interests of MAXAMERICA or that would conflict with
MAXAMERICA's business as proposed to be conducted. Neither the execution or
delivery of this Agreement, nor the carrying on of MAXAMERICA's business by the
employees of MAXAMERICA, nor the conduct of MAXAMERICA's business as proposed,
will, to the best of MAXAMERICA's knowledge, conflict with or result in a breach
of the terms, conditions or provisions of, or constitute a default under, any
contract, covenant or instrument under which any of such employees is now
obligated. MAXAMERICA does not believe it is or will be necessary to utilize any
inventions of any of its employees (or people it currently intends to hire) made
prior to their employment by MAXAMERICA.
2.2.9 EMPLOYEE BENEFIT PLANS. All employee benefit plans (including
without limitation all plans which authorize the granting of stock options,
restricted stock, stock bonuses or other equity based awards) covering active,
former or returned employees of MAXAMERICA are listed in the MAXAMERICA
Disclosure Schedule.
2.2.10 MAJOR CONTRACTS. Except as otherwise disclosed in the
MAXAMERICA Disclosure Schedule, MAXAMERICA is not a party or subject to:
(a) Any union contract, or any employment contract or arrangement
providing for future compensation, written or oral, with any officer,
consultant, director or employee which is not terminable by MAXAMERICA on 30
days' notice or less without penalty or obligations to make payments related to
such termination;
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(b) Any joint venture contract, partnership agreement or arrangement
or any other agreement which has involved or is expected to involve a sharing of
revenues with other persons or a joint development of products with other
persons;
(c) Any production, distribution, sales, franchise, marketing or
license agreement or arrangement by which products or services of MAXAMERICA are
developed, sold or distributed;
(d) Any material agreement, license, franchise, permit, indenture or
authorization which has not been terminated or performed in its entirety and not
renewed which may be, by its terms, accelerated, terminated, impaired or
adversely affected by reason of the execution of this Agreement, or the
consummation of the transactions contemplated hereby or thereby;
(e) Any material agreement, contract or commitment that requires the
consent of another person for MAXAMERICA to enter into or consummate the
transactions contemplated by this Agreement;
(f) Any contract containing covenants purporting to materially limit
MAXAMERICA's freedom to compete in any line of business in any geographic area.
2.2.11 LEASES IN EFFECT . All Leases as to which MAXAMERICA is a party
are listed in the MAXAMERICA Disclosure Schedule and are valid, in full force
and effect and enforceable, and there are no existing defaults on the part of
MAXAMERICA, and MAXAMERICA has not received nor given notice of default or
claimed default with respect to any Lease, nor is there any event that with
notice or lapse of time, or both, would constitute a default thereunder. Except
as set forth on the MAXAMERICA Disclosure Schedule, no consent is required from
any party under any Lease in connection with the completion of the transactions
contemplated by this Agreement, and MAXAMERICA has not received notice that any
party to any Lease intends to cancel, terminate, or refuse to renew the same or
to exercise any option or other right thereunder, except where the failure to
receive such consent, or where such cancellation, termination or refusal, would
not have a Material Adverse Effect on MAXAMERICA.
2.2.12 TAXES. Except as set forth elsewhere in this Agreement or in
the MAXAMERICA Disclosure.
(a) All taxes, assessments, fees, penalties, interest and other
governmental charges with respect to MAXAMERICA which have become due and
payable as of the date of Closing have been paid in full or adequately reserved
against by MAXAMERICA, and all taxes, assessments, fees, penalties, interest and
other governmental charges which have become due and payable subsequent to the
date of Closing have been paid in full or adequately reserved against on its
books of account and such books are sufficient for the payment of all unpaid
federal, state, local, foreign and other taxes, fees and assessments (including
without limitation, income, property, sales, use, franchise, capital stock,
excise, added value, employees' income withholding, social security and
unemployment taxes), and all interest and penalties thereon with respect to the
periods then ended and for all periods prior thereto;
(b) There are no agreements, waivers or other arrangements providing
for an extension of time with respect to the assessment of any tax or deficiency
against MAXAMERICA, nor are there any actions, suits, proceedings,
investigations or claims now pending against MAXAMERICA in respect of any tax or
assessment, or any matters under discussion with any federal, state, local or
foreign authority relating to any taxes or assessments, or any claims for
additional taxes or assessments asserted by any such authority; and
(c) There are no liens for taxes upon the assets of MAXAMERICA except
for taxes that are not yet payable. MAXAMERICA has withheld all taxes required
to be withheld in respect of wages, salaries and other payments to all
employees, officers and directors and timely paid all such amounts withheld to
the proper taxing authority.
2.2.13 DISPUTES AND LITIGATION. Except as disclosed in the MAXAMERICA
Disclosure Schedule, there is no suit, claim, action, litigation, or proceeding
pending or, to the knowledge of MAXAMERICA, threatened against or affecting
MAXAMERICA or any of its properties, assets or business or to which MAXAMERICA
is a party, in any court or before any arbitrator of any kind or before or by
any Governmental Entity, which would, if adversely determined, individually or
in the aggregate, have a Material Adverse Effect on MAXAMERICA, nor is there any
judgment, decree, injunction, rule or order of any Governmental Entity or
arbitrator outstanding against
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MAXAMERICA having, or which, insofar as reasonably can be foreseen, in the
future could have, any such effect. To the knowledge of MAXAMERICA, there is
no investigation pending or threatened against MAXAMERICA before any foreign,
federal, state, municipal or other governmental department, commission,
board, bureau, agency, instrumentality or other Governmental Entity.
2.2.14 COMPLIANCE WITH LAWS. Except as set forth in the MAXAMERICA
Disclosure Schedule, MAXAMERICA's business is not being conducted in violation
of, or in a manner which could cause liability under any applicable law, rule or
regulation, judgment, decree or order of any Governmental Entity, except for any
violations or practices, which, individually or in the aggregate, have not had
and will not have a Material Adverse Effect on MAXAMERICA. MAXAMERICA has all
franchises, permits, licenses, and any similar authority necessary for the
conduct of its business as now being conducted by it, the lack of which could
materially and adversely affect the business, properties, prospects, or
financial condition of MAXAMERICA, and the believes it can obtain, without undue
burden or expense, any similar authority for the conduct of its business as it
is planned to be conducted. MAXAMERICA is not in default in any material respect
under any of such franchises, permits, licenses or other similar authority. A
true and complete list of all such franchises, permits, and licenses held by
MAXAMERICA is set forth in the MAXAMERICA Disclosure Schedule.
2.2.15 INSURANCE. The MAXAMERICA Disclosure Schedule sets forth a true
and complete list of all insurance policies maintained by MAXAMERICA concerning
its business and properties. MAXAMERICA has in full force and effect fire and
casualty insurance policies, with extended coverage, sufficient in amount
(subject to reasonable deductibles) to allow it to replace any of its properties
that might be damaged or destroyed.
2.2.16 MINUTE BOOKS. The minute books of MAXAMERICA provided to BRIGHT
contain a complete summary of all meetings of directors and shareholders since
the time of incorporation and reflect all transactions referred to in such
minutes accurately in all material respects.
2.2.17 DISCLOSURE. No representation or warranty made by MAXAMERICA in
this Agreement, nor any document, written information, statement, financial
statement, certificate or exhibit prepared and furnished or to be prepared and
furnished by MAXAMERICA or their representatives pursuant hereto or in
connection with the transactions contemplated hereby, when taken together,
contains any untrue statement of a material fact, or omits to state a material
fact necessary to make the statements or facts contained herein or therein not
misleading in light of the circumstances under which they were furnished.
2.2.18 RELIANCE. The foregoing representations and warranties are made
by MAXAMERICA with the knowledge and expectation that MAXAMERICA is placing
reliance thereon.
ARTICLE 3
CONDITIONS PRECEDENT
3.1 CONDITIONS TO EACH PARTY'S OBLIGATIONS. The respective obligations of
each party hereunder shall be subject to the satisfaction prior to or at the
Closing of the following conditions:
(a) NO RESTRAINTS. No statute, rule, regulation, order, decree or
injunction shall have been enacted, entered, promulgated or enforced by any
court or Governmental Entity of competent jurisdiction which enjoins or
prohibits the consummation of this Agreement and shall be in effect.
(b) LEGAL ACTION. There shall not be pending or threatened in writing
any action, proceeding or other application before any court or Governmental
Entity challenging or seeking to restrain or prohibit the consummation of the
transactions contemplated by this Agreement, or seeking to obtain any material
damages.
3.2 CONDITIONS TO SHAREHOLDERS' OBLIGATIONS. The respective obligations of
the Shareholders shall be subject to the satisfaction prior to or at the Closing
of the following conditions unless waived by the Shareholders:
(a) REPRESENTATIONS AND WARRANTIES OF MAXAMERICA. The representations
and warranties of MAXAMERICA set forth in this Agreement shall be true and
correct as of the date of this Agreement and as of the Closing as though made on
and as of the Closing, except: (i) as otherwise contemplated by this Agreement,
or (ii) in
11
respects that do not have a Material Adverse Effect on MAXAMERICA or on the
benefits of the transactions provided for in this Agreement. Shareholders
shall have received a certificate signed on behalf of MAXAMERICA by the chief
executive officer and the chief financial officer of MAXAMERICA to such
effect on the Closing.
(b) PERFORMANCE OF OBLIGATIONS OF MAXAMERICA. MAXAMERICA shall have
performed all agreements and covenants required to be performed by it under this
Agreement prior to the Closing, except for breaches that do not have a Material
Adverse Effect on MAXAMERICA or on the benefits of the transactions provided for
in this Agreement. Shareholders shall have received a certificate signed on
behalf of MAXAMERICA by the chief executive officer of MAXAMERICA to such effect
on the Closing.
(c) GOVERNMENTAL APPROVALS. All Consents of Governmental Entities
legally required by BRIGHT for the transactions contemplated by this Agreement
shall have been filed, occurred, or been obtained, other than such Consents, the
failure of which to obtain would not have a Material Adverse Effect on the
consummation of the transactions contemplated by this Agreement.
(d) CONSENTS OF OTHER THIRD PARTIES. MAXAMERICA shall have received
and delivered to Shareholders all requisite consents and approvals of all
lenders, lessors, and other third parties whose consent or approval is required
in order for MAXAMERICA to consummate the transactions contemplated by this
Agreement, or in order to permit the continuation after the Closing of the
business activities of MAXAMERICA in the manner such business is presently
carried on by MAXAMERICA.
(e) MATERIAL ADVERSE CHANGE. Since the date hereof and through
Closing, there shall not have occurred any change, occurrence or circumstance in
MAXAMERICA having or reasonably likely to have, individually or in the
aggregate, in the reasonable judgment of Shareholders, Material Adverse Effect
on MAXAMERICA.
(f) FINANCING. The Shareholders shall have obtained a loan sufficient
to pay off the existing federal and state tax liabilities of BRIGHT.
3.3 CONDITIONS TO MAXAMERICA'S OBLIGATIONS. The obligations of MAXAMERICA
shall be subject to the satisfaction prior to or at the Closing of the following
conditions unless waived by MAXAMERICA:
(a) REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. The
representations and warranties of Shareholders set forth in this Agreement shall
be true and correct as of the date of this Agreement and as of the Closing as
though made on and as of the Closing, except: (i) as otherwise contemplated by
this Agreement, or (ii) in respects that do not have a Material Adverse Effect
on Shareholders or on the benefits of the transactions provided for in this
Agreement. MAXAMERICA shall have received a certificate signed by or on behalf
of Shareholders to such effect on the Closing.
(b) PERFORMANCE OF OBLIGATIONS OF SHAREHOLDERS. Shareholders shall
have performed all agreements and covenants required to be performed by it under
this Agreement prior to the Closing, except for breaches that do not have a
Material Adverse Effect on Shareholders or on the benefits of the transactions
provided for in this Agreement. MAXAMERICA shall have received a certificate
signed by or on behalf of Shareholders to such effect on the Closing.
(c) GOVERNMENTAL APPROVALS. All Consents of Governmental Entities
legally required by BRIGHT for the transactions contemplated by this Agreement
shall have been filed, occurred, or been obtained, other than such Consents, the
failure of which to obtain would not have a Material Adverse Effect on the
consummation of the transactions contemplated by this Agreement.
(d) CONSENTS OF OTHER THIRD PARTIES. Shareholders shall have received
and delivered to MAXAMERICA all requisite consents and approvals of all lenders,
lessors, and other third parties whose consent or approval is required in order
for Shareholders to consummate the transactions contemplated by this Agreement,
or in order to permit the continuation after the Closing of the business
activities of BRIGHT in the manner such business is presently carried on by
BRIGHT.
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(e) MATERIAL ADVERSE CHANGE. Since the date hereof and through
Closing, there shall not have occurred any change, occurrence or circumstance in
BRIGHT; having or reasonably likely to have, individually or in the aggregate,
in the reasonable judgment of MAXAMERICA, a Material Adverse Effect on BRIGHT.
(f) NO LIENS. The assets of BRIGHT shall be free and clear from any
material liens or encumbrances, except for the liens encumbering certain real
property owned by BRIGHT as disclosed in the BRIGHT Disclosure Schedule.
(g) OPERATION OF BRIGHT. In the thirty (30) days prior to Closing, the
operations of BRIGHT shall have generated no net losses.
(h) EQUITY. BRIGHT shall have equity in its assets and properties,
including without limitation, real property and furniture, fixtures and
equipment, equal to or greater than $300,000 as reflected in BRIGHT's Financial
Statements.
(i) NO DEBT. BRIGHT shall have no material debt, liabilities or
obligations except those that have arisen in the ordinary course of business, or
as disclosed in the BRIGHT Disclosure Schedule.
ARTICLE 4
CONVENANTS
4.1 CONFIDENTIALITY. Each party hereto will hold and will cause its
consultants and advisors to hold in strict confidence, unless compelled to
disclose by judicial or administrative process or, in the opinion of its
counsel, by other requirements of law, all documents and information concerning
the other party furnished it by such other party or its representatives in
connection with the transactions contemplated by this Agreement (except to the
extent that such information can be shown to have been (i) previously known by
the party to which it was furnished, (ii) in the public domain through no fault
of such party, or (iii) later lawfully acquired from other sources by the party
to which it was furnished), and each party will not release or disclose such
information to any other person, except its auditors, attorneys, financial
advisors, bankers and other consultants and advisors in connection with this
Agreement. Each party shall be deemed to have satisfied its obligations to hold
confidential information concerning or supplied by the other party if it
exercises the same care as it takes to preserve confidentiality for its own
similar information. In the event of termination of this Agreement, each party
shall use its best efforts to return to the other party all documents and copies
thereof received from the other party that contain information subject to the
confidentiality requirements of this Section. Notwithstanding the foregoing, the
Shareholders acknowledge and agree that following Closing, MAXAMERICA will be
issuing a press release regarding the closing of the transactions contemplated
hereunder.
4.2 FURTHER ASSURANCES. Each party agrees that upon the request of any
other they will, from time to time, without further consideration, execute and
deliver to such other all such instruments and documents of further assurance or
otherwise, wand will do any and all such acts and things as may be reasonable
required, to carry out the obligations of such party hereunder and to consummate
the transactions contemplate hereby.
ARTICLE 5
THE CLOSING
5.1 TIME AND PLACE. The purchase and sale of BRIGHT Shares shall take
place at the offices of MAXAMERICA, 0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxxx
Xxxxx, XX 00000, on or before September 30, 1999, or at such other time and
place as the parties mutually agree upon in writing (which time and place are
hereafter referred to as the "Closing").
5.2 DELIVERIES BY MAXAMERICA. MAXAMERICA shall make the following
Deliveries:
(a) At Closing, to Shareholders, an Employment Agreement.
13
(b) At Closing, to Shareholders, a certificate executed by MAXAMERICA
certifying that all MAXAMERICA's representations and warranties under this
Agreement are true as of the Closing, as though each of those representations
and warranties had been made on that date;
(c) At Closing, to Shareholders, certified resolutions of the Board of
Directors and shareholders of MAXAMERICA, in form satisfactory to counsel for
Shareholders, authorizing the execution and performance of this Agreement; and
5.3 DELIVERIES BY SHAREHOLDERS. At Closing, Shareholders shall make the
following deliveries to MAXAMERICA:
(a) A certificate or certificates representing the BRIGHT Shares, duly
endorsed by Shareholders for transfer or accompanied by an assignment of the
BRIGHT Shares duly executed by Shareholders in form reasonably satisfactory to
counsel for MAXAMERICA;
(b) The Employment Agreement, each duly executed by the appropriate
Shareholder;
(c) A certificate executed by Shareholders certifying that the
Shareholders' respective representations and warranties under this Agreement are
true as of the Closing, as though each of those representations and warranties
had been made on that date;
(d) Certified resolutions of the Board of Directors and Shareholders
of BRIGHT, in a form satisfactory to counsel for MAXAMERICA, authorizing the
execution and performance of this Agreement; and
(e) The stock books, stock ledgers, minute books, corporate seals, and
all other corporate
5.4 BOARD OF DIRECTORS CONSENT. This Agreement is contingent on the
unanimous written consent of HomeLife's Board of Directors to approve this
agreement, and consent to the issuing of its common shares to Shareholders under
the terms of this Agreement.
ARTICLE 6
INDEMNIFICATION
6.1 SHAREHOLDERS' INDEMNITY.
(a) Upon receipt of notice thereof, Shareholders shall, jointly and
severally, indemnify, defend, and hold harmless MAXAMERICA from any and all
claims, demands, liabilities, damages, deficiencies, losses, obligations, costs
and expenses, including attorney fees and any costs of investigation that
MAXAMERICA shall incur or suffer, that arise, result from or relate to (i) any
breach of, or failure by Shareholders to perform, any of their representations,
warranties, covenants, or agreements in this Agreement or in any schedule,
certificate, exhibit, or other instrument furnished or to be furnished by
Shareholders under this Agreement, and (ii) the employment of any of BRIGHT'
employees, including the employee set forth in the BRIGHT Disclosure Schedule,
which is in violation of any law, regulation, or ordinance of any Governmental
Entity.
(b) MAXAMERICA shall notify promptly Shareholders of the existence of
any claim, demand or other matter to which Shareholders' indemnification
obligations would apply, and shall give them a reasonable opportunity to defend
the same at their own expense and with counsel of their own selection, provided
that MAXAMERICA shall at all times also have the right to fully participate in
the defense. If Shareholders, within a reasonable time after this notice, fails
to defend, MAXAMERICA shall have the right, but not the obligation, to undertake
the defense of, and, with the written consent of the Shareholders, to compromise
or settle the claim the claim or other matter on behalf, for the account, and at
the risk, of Shareholders.
6.2 MAXAMERICA'S INDEMNITY.
(a) Upon receipt of notice thereof, MAXAMERICA shall indemnify,
defend, and hold harmless Shareholders from any and all claims, demands,
liabilities, damages, deficiencies, losses, obligations, costs and
14
expenses, including attorney fees and any costs of investigation that
Shareholders shall incur or suffer, that arise, result from or relate to any
breach of, or failure by MAXAMERICA to perform, any of its representations,
warranties, covenants, or agreements in this Agreement or in any schedule,
certificate, exhibit, or other instrument furnished or to be furnished by
MAXAMERICA under this Agreement.
(b) Shareholders shall notify promptly MAXAMERICA of the existence of
any claim, demand or other matter to which MAXAMERICA's indemnification
obligations would apply, and shall give it a reasonable opportunity to defend
the same at its own expense and with counsel of its own selection, provided that
Shareholders shall at all times also have the right to fully participate in the
defense. If MAXAMERICA, within a reasonable time after this notice, fails to
defend, Shareholders shall have the right, but not the obligation, to undertake
the defense of, and, with the written consent of MAXAMERICA, to compromise or
settle the claim or other matter on behalf, for the account, and at the risk, of
MAXAMERICA.
ARTICLE 7
DEFAULT, AMENDMENT AND WAIVER
7.1 DEFAULT. Upon a breach or default under this Agreement by any of the
parties (following the cure period provided herein), the non-defaulting party
shall have all rights and remedies given hereunder or now or hereafter existing
at law or in equity or by statute or otherwise. Notwithstanding the foregoing,
in the event of a breach or default by any party hereto in the observance or in
the timely performance of any of its obligations hereunder which is not waived
by the non-defaulting party, such defaulting party shall have the right to cure
such default within fifteen (15) days after receipt of notice in writing of such
breach or default.
7.2 WAIVER AND AMENDMENT. Any term, provision, covenant, representation,
warranty or condition of this Agreement may be waived, but only by a written
instrument signed by the party entitled to the benefits thereof. The failure or
delay of any party at any time or times to require performance of any provision
hereof or to exercise its rights with respect to any provision hereof shall in
no manner operate as a waiver of or affect such party's right at a later time to
enforce the same. No waiver by any party of any condition, or of the breach of
any term, provision, covenant, representation or warranty contained in this
Agreement, in any one or more instances, shall be deemed to be or construed as a
further or continuing waiver of any such condition or breach or waiver of any
other condition or of the breach of any other term, provision, covenant,
representation or warranty. No modification or amendment of this Agreement shall
be valid and binding unless it be in writing and signed by all parties hereto.
ARTICLE 8
MISCELLANEOUS
8.1 EXPENSES. Whether or not the transactions contemplated hereby are
consummated, each of the parties hereto shall bear all taxes of any nature
(including, without limitation, income, franchise, transfer and sales taxes) and
all fees and expenses relating to or arising from its compliance with the
various provisions of this Agreement and such party's covenants to be performed
hereunder, and except as otherwise specifically provided for herein, each of the
parties hereto agrees to pay all of its own expenses (including, without
limitation, attorneys and accountants' fees and printing expenses) incurred in
connection with this Agreement, the transactions contemplated hereby, the
negotiations leading to the same and the preparations made for carrying the same
into effect, and all such taxes, fees and expenses of the parties hereto shall
be paid prior to Closing.
8.2 NOTICES. Any notice, request, instruction or other document required
by the terms of this Agreement, or deemed by any of the parties hereto to be
desirable, to be given to any other party hereto shall be in writing and shall
be given by prepaid telegram or delivered or mailed by registered or certified
mail, postage prepaid, with return receipt requested, to the following
addresses:
TO BRIGHT FINANCIAL CORPORATION:
BRIGHT Financial Corporation
00000 Xxxxxx Xxxx. Xxxxx 000
Xxxxxx, XX 00000
Attn: Xx. Xxxxxx Xxxxxx
15
TO MAXAMERICA:
MAXAMERICA, Inc.
0000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attn: Xx. Xxxxxx Xxxxxxxx
The persons and addresses set forth above may be changed from time to time by a
notice sent as aforesaid. If notice is given by delivery in accordance with the
provisions of this Section, said notice shall be conclusively deemed given at
the time of such delivery. If notice is given by mail in accordance with the
provisions of this Section, such notice shall be conclusively deemed given
forty-eight (48) hours after deposit thereof in the United States mail. If
notice is given by telegraph in accordance with the provisions of this Section,
such notice shall be conclusively deemed given at the time that the telegraphic
agency shall confirm delivery thereof to the addressee.
8.3 ENTIRE AGREEMENT. This Agreement, together with the Schedule and
exhibits hereto, sets forth the entire agreement and understanding of the
parties hereto with respect to the transactions contemplated hereby, and
supersedes all prior agreements, arrangements and understandings related to the
subject matter hereof. No understanding, promise, inducement, statement of
intention, representation, warranty, covenant or condition, written or oral,
express or implied, whether by statute or otherwise, has been made by any party
hereto which is not embodied in this Agreement, or in the schedules or exhibits
hereto or the written statements, certificates, or other documents delivered
pursuant hereto or in connection with the transactions contemplated hereby, and
no party hereto shall be bound by or liable for any alleged understanding,
promise, inducement, statement, representation, warranty, covenant or condition
not so set forth.
8.4 SURVIVAL OF REPRESENTATIONS. All statements of fact (including
financial statements) contained in the Schedule, the exhibits, the certificates
or any other instrument delivered by or on behalf of the parties hereto, or in
connection with the transactions contemplated hereby, shall be deemed
representations and warranties by the respective party hereunder. All
representation, warranties agreements and covenants hereunder shall survive the
Closing and remain effective regardless of any investigation or audit at any
time made by or on behalf of the parties or of any information a party may have
in respect hereto. Consummation of the transactions contemplated hereby shall
not be deemed or construed to be a waiver of any right or remedy possessed by
any party hereto, notwithstanding that such party knew or should have known at
the time of Closing that such right or remedy existed.
8.5 INCORPORATED BY REFERENCE. The schedules, exhibits and all documents
(including, without limitation, all financial statements) delivered as part
hereof or incident hereto are incorporated as a part of this Agreement by
reference.
8.6 REMEDIES CUMULATIVE. No remedy herein conferred upon the parties is
intended to be exclusive of any other remedy and each and every such remedy
shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.
8.7 EXECUTION OF ADDITIONAL DOCUMENTS. Each party hereto shall make,
execute, acknowledge and deliver such other instruments and documents, and take
all such other actions as may be reasonably required in order to effectuate the
purposes of this Agreement and to consummate the transactions contemplated
hereby.
8.8 FINDERS' AND RELATED FEES. Each of the parties hereto is responsible
for, and shall indemnify the other against, any claim by any third party to a
fee, commission, bonus or other remuneration arising by reason of any services
alleged to have been rendered to or at the instance of said party to this
Agreement with respect to this Agreement or to any of the transactions
contemplated hereby.
8.9 GOVERNING LAW. This Agreement has been negotiated and executed in the
State of California and shall be construed and enforced in accordance with the
laws of such state.
16
8.10 FORUM. Each of the parties hereto agrees that any action or suit which
may be brought by any party hereto against any other party hereto in connection
with this Agreement or the transactions contemplated hereby may be brought only
in a federal or state court in Orange County, California.
8.11 BINDING EFFECT AND ASSIGNMENT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
executors, administrators, legal representatives and assigns.
8.12 COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument. In making proof of this Agreement, it shall not be
necessary to produce or account for more than one such counterpart.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on the day and year first above written.
BRIGHT FINANCIAL CORPORATION
a California corporation
By ______________________________
Name: ___________________________
Its: ____________________________
SHAREHOLDERS
_________________________________
Xxxxxx Xxxxxx
_________________________________
Xxxxxx Xxxxxx
MAXAMERICA, INC.
A California Corporation
By ______________________________
Name: ___________________________
Its: ____________________________
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EXHIBIT A
ACTION BY UNANIMOUS WRITTEN CONSENT
OF THE BOARD OF DIRECTORS OF
HOMELIFE, INC.
A Nevada Corporation
The undersigned constituting the entire Board of Director of HOMELIFE, Inc.
a Nevada corporation (the "Corporation"), in accordance with code section 78.315
of the Nevada Revised Statutes, without the formality of convening a meeting, do
hereby consent to and adopt the following resolutions.
ACQUISITION OF BRIGHT FINANCIAL CORPORATION
WHEREAS, the President of the Corporation has been in discussions with the
principals of BRIGHT Financial Corporation about the purchase of stock in their
company in consideration of the common stock of HomeLife, and;
WHEREAS, the Shareholders of BRIGHT Mortgage Corporation have agreed to
sell their shares to MAXAMERICA Financial Services, Inc.
NOW, THEREFORE IT IS HEREBY RESOLVED, that the President of the Corporation
will have the approval of the Board of Directors to sell sufficient shares of
the common stock of the Corporation to satisfy the terms of the Acquisition
Agreement between BRIGHT Financial Corporation and MAXAMERICA Financial Services
dated ______, 1999.
The undersigned constituting all of the Directors of the Corporations, by
affixing their signature below do hereby approve the resolution set forth above.
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IN WITNESS WHEREOF, the undersigned Directors constituting all of the
Directors of the Corporation have executed this Unanimous Written Consent in
Lieu of Meeting as of this ______ day of August, 1999.
___________________
Xxxxxx Xxxxxxxx
____________________
Xxxxxx X. Xxxxxxx
____________________
Xxxxx X. Xxxxx
____________________
X. Xxxxxx Farrill
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EXHIBIT B
EMPLOYMENT AGREEMENT
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EXHIBIT C
BRIGHT DISCLOSURE SCHEDULE
The items set forth below are exceptions to the representations and warranties
of Shareholders set forth in Section 2.1 of this Agreement. Any matter set forth
herein as an exception to a section of the Agreement shall be deemed to
constitute and exception to all other applicable sections of this Agreement.
Capitalized terms not otherwise defined herein shall have the meaning ascribed
to them in this Agreement.
Section Exception
2.1.1 Organization. Standing. Power.
2.1.2 Authority
2.1.3 Capitalization of BRIGHT
2.1.4 No Defaults
2.1.5 Governmental Consents
2.1.6 Financial Statements
2.1.7 Absence of Undisclosed Liabilities
2.1.8 Absence of Changes
2.1.9 Patents and Trademarks
2.1.10 Employee Benefit Plans
2.1.11 Other Personal Property
2.1.12 Major Contracts
2.1.13 Leases in Effect
2.1.14 Taxes
2.1.15 Disputes and Litigation
2.1.16 Compliance with Laws
2.1.17 Related Party Transactions
2.1.18 Insurance
2.1.19 Minute Books
2.1.20 Disclosure
2.1.21 Reliance
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EXHIBIT D
MAXAMERICA DISCLOSURE SCHEDULE
The items set forth below are exceptions to the representations and warranties
of Shareholders set forth in Section 2.1 of this Agreement. Any matter set forth
herein as an exception to a section of the Agreement shall be deemed to
constitute and exception to all other applicable sections of this Agreement.
Capitalized terms not otherwise defined herein shall have the meaning ascribed
to them in this Agreement.
Section Exception
2.2.1 Organization. Standing. Power.
2.2.2 Authority
2.2.3 Capitalization of MAXAMERICA
2.2.4 No Defaults
2.2.5 Governmental Consents
2.2.6 Financial Statements
2.2.7 Absence of Undisclosed Liabilities
2.2.8 Patents and Trademarks
2.2.9 Employee Benefit Plans
2.2.10 Major Contracts
2.2.11 Leases in Effect
2.2.12 Taxes
2.2.13 Disputes and Litigation
2.2.14 Compliance with Laws
2.2.15 Insurance
2.2.16 Minute Books
2.2.17 Disclosure
2.2.18 Reliance
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