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Exhibit 10.55
SECURITIES PURCHASE AGREEMENT
By and Among:
XXXXXX X. XXXXXXXXXX III (the "Seller"),
CRUTTENDEN XXXX INCORPORATED (the "Company"), and
FIDELITY NATIONAL FINANCIAL, INC. (the "Purchaser").
April 8, 1998
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TABLE OF CONTENTS
PAGE
1. DEFINITIONS..........................................................................1
2. PURCHASE AND SALE OF THE SHARES AND OPTION...........................................3
2.1 Authorization.................................................................3
2.2 Purchase of Securities; Purchase Price........................................3
3. CLOSING..............................................................................4
3.1 Time and Place................................................................4
3.2 Deliveries....................................................................4
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SELLER.............................4
4.1 Organization and Good Standing................................................4
4.2 Capitalization................................................................4
4.3 Authorization.................................................................5
4.4 Due Execution and Delivery; Binding Obligations...............................5
4.5 No Violation..................................................................5
4.6 Governmental Consents.........................................................5
4.7 Financial Statements..........................................................5
4.8 Material Liabilities..........................................................5
4.9 Changes.......................................................................5
4.10 Labor Agreements and Actions..................................................6
4.11 Employee Benefit Plans; ERISA.................................................6
4.12 Taxes.........................................................................6
4.13 Compliance with Charter, Applicable Laws and Material Contracts...............7
4.14 Litigation; Adverse Facts.....................................................7
4.15 Licenses, Permits and Authorizations..........................................7
4.16 Leases........................................................................7
4.17 Powers of Attorney............................................................8
4.18 Insurance.....................................................................8
4.19 Books and Records.............................................................8
4.20 Outstanding Indebtedness......................................................8
4.21 Employment and Agency Agreements..............................................8
4.22 Net Capital...................................................................8
4.23 Disclosure....................................................................9
5. REPRESENTATIONS AND WARRANTIES OF THE SELLER.........................................9
5.1 Ownership.....................................................................9
5.2 Authorization.................................................................9
5.3 Due Execution and Delivery; Binding Obligations...............................9
5.4 No Violation..................................................................9
5.5 Governmental Consents.........................................................9
5.6 Investment Representations....................................................9
5.7 Disclosure...................................................................11
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PAGE
6. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER.....................................11
6.1 Organization and Good Standing...............................................11
6.2 Authorization................................................................11
6.3 Due Execution and Delivery; Binding Obligations..............................11
6.4 No Violation.................................................................11
6.5 Investment Intent............................................................11
6.6 Accredited Investor Status; No Reliance......................................11
6.7 Governmental Consents........................................................12
6.8 Litigation; Adverse Facts....................................................12
6.9 Brokers......................................................................12
6.10 Issuance of Fidelity Shares..................................................12
6.11 Reports......................................................................12
6.12 Disclosure...................................................................12
7. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER......................................13
7.1 Representations and Warranties...............................................13
7.2 Purchase Permitted by Applicable Laws........................................13
7.3 No Material Adverse Changes..................................................13
7.4 No Material Judgment or Order................................................13
7.5 Securities...................................................................13
7.6 Shareholders' Agreement......................................................13
7.7 CRI Registration Rights Agreement............................................13
7.8 Payment of Taxes.............................................................14
7.9 Escrow Instructions..........................................................14
7.10 Financial Statements.........................................................14
7.11 Third Party Consents.........................................................14
8. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY AND THE SELLER.........................14
8.1 Representations and Warranties...............................................14
8.2 Purchase Permitted by Applicable Laws........................................14
8.3 No Material Judgment or Order................................................14
8.4 Third Party Consents.........................................................15
8.5 Fidelity Registration Rights Agreement.......................................15
8.6 Escrow Instructions..........................................................15
9. TERMINATION.........................................................................15
9.1 Failure of Condition.........................................................15
9.2 Effect of Termination........................................................15
10. POST-CLOSING OBLIGATIONS............................................................15
10.1 Use of Proceeds..............................................................15
10.2 Disclosure of Subsequent Events..............................................16
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PAGE
11. MISCELLANEOUS.......................................................................16
11.1 Indemnification..............................................................16
11.2 Attorneys' Fees..............................................................17
11.3 Entire Agreement.............................................................17
11.4 Headings.....................................................................17
11.5 Successors and Assigns.......................................................17
11.6 Parties in Interest..........................................................17
11.7 Amendments, Waivers and Consents.............................................17
11.8 Notice.......................................................................17
11.9 Transaction Fees and Expenses................................................18
11.10 Severability.................................................................19
11.11 Counterparts.................................................................19
11.12 Waiver of Jury Trial.........................................................19
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Exhibits PAGE
Exhibit A - Form of Option
Exhibit B - Form of Escrow Instructions
Exhibit C - Form of Shareholders' Agreement
Exhibit D - Form of CRI Registration Rights Agreement
Exhibit E - Form of Fidelity Registration Rights Agreement
Schedules
Schedule 4.2 - Capitalization
Schedule 4.9 - Changes
Schedule 4.13 - Compliance with Charters, Applicable Laws and Material Contracts
Schedule 4.14 - Litigation; Adverse Facts
Schedule 4.20 - Outstanding Indebtedness
Schedule 4.21 - Employment and Agency Agreements
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SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (the "Agreement") is made and entered
into this 8th day of April, 1998, by and among XXXXXX X. XXXXXXXXXX III (the
"Seller"), CRUTTENDEN XXXX INCORPORATED, a California corporation (the
"Company"), and FIDELITY NATIONAL FINANCIAL, INC., a Delaware corporation (the
"Purchaser").
R E C I T A L S
A. Seller owns and holds of record in excess of 750,000 shares of the
Company's Common Stock, no par value (the "Common Stock").
B. The Purchaser has agreed to purchase from Seller, and Seller has
agreed to offer for sale and sell to the Purchaser, on the terms set forth in
this Agreement, (i) an aggregate of 580,000 shares (the "Shares") of Common
Stock, (ii) an Option to purchase an aggregate of 170,000 shares of the Common
Stock, at an exercise price of Ten Dollars ($10.00) per share (subject to
adjustment as provided in the Option), which Option shall be in the form of
Exhibit A attached hereto (as it may be amended, modified, restated,
supplemented, extended or reduced, the "Option"), and (iii) the Common Stock
issuable upon exercise of the Option.
AGREEMENT
In consideration of the mutual covenants and agreements set forth
herein, and for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the following terms
shall have the meanings specified with respect thereto below:
"Applicable Laws" means any Federal, state or local statute, law, rule,
regulation or ordinance applicable to the Company or its business, including,
without limitation, the Securities Act of 1933, the Securities Exchange Act of
1934, the rules and regulations under those acts or of any self-regulatory
organization given regulatory authority under those acts, the California
Corporate Securities Law of 1968, Federal Reserve Board Regulation T and any
other laws or regulations applicable to the Company, including laws relating to
the operation of securities brokerages and laws relating to franchise, building,
zoning, health, sanitation, safety or labor relations, and any order, ruling,
judgment or decree of any court, governmental agency or authority or
self-regulatory agency which is binding on the Company or its properties.
"Board of Directors" means the board of directors of any Person.
"Business Day" means any day except Saturday, Sunday and any day which
either is a legal holiday under the laws of the State of California or is a day
on which banking institutions located in such state are authorized or required
by law or other governmental action to close.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder, all as the same
shall be in effect at the time.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder, all as the same
shall be in effect at the time.
"Financial Statements" shall have the meaning set forth in Section 4.7
below.
"GAAP" means generally accepted accounting principles and practices set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession that are applicable to the circumstances as of the
date hereof, applied on a consistent basis.
"Indebtedness" means (without duplication), when used with reference to
any Person, (i) any indebtedness, contingent or otherwise, in respect of
borrowed money (whether or not the recourse of the lender is to the whole of the
assets of such Person or only to a portion thereof), or evidenced by bonds,
note, debentures or similar instruments or letters of credit or representing the
unpaid balance of the purchase price of any property, but not including any
other indebtedness, amount or obligation incurred in the ordinary course of the
broker-dealer business consistent with past practice (e.g., unsettled trades),
(ii) the principal component of any capital lease obligations of such Person,
(iii) the maximum fixed repurchase price of any redeemable stock of such Person,
(iv) the maximum amount payable under any earnout agreement, contingent payment
obligation, deferred financing fee or similar deferred or contingent obligation,
and (v) obligations secured by a Lien to which any property or asset, including
leasehold interests and any other tangible or intangible property rights, owned
by such Person is subject, whether or not the obligations secured thereby have
been assumed by such Person.
"Licenses and Permits" means all licenses, franchises, certificates,
permits, consents, registrations, certificates, memberships and other approvals
of all governmental or regulatory agencies or self-regulatory organizations,
whether Federal, state or local, necessary to the conduct of its business,
including, without limitation, licenses or certificates issued under Sections
25210 and 25211 of the California Corporate Securities Law of 1968 or similar
laws in each of the states where the Company's activities would require such
licensing, compliance with all bonding requirements of any state or municipality
and any licenses, permits, registrations or approvals required to comply with or
obtain exemptions from the usury laws of any state.
"Lien" means any lien, pledge, mortgage, claim, covenant, restriction,
security interest, charge or encumbrance of any kind, including the interest of
a lessor under a capital lease obligation having substantially the same economic
effect.
"Material Adverse Effect" means, with respect to any Person, a material
adverse effect on the condition (financial or otherwise), business, results of
operations, prospects or properties of such Person.
"Net Capital" shall have the meaning assigned to that term in clause (c)
of Rule 15c3-1 under the Exchange Act.
"Person" means any individual, trustee, sole proprietorship,
partnership, joint venture, trust, unincorporated organization, association,
corporation, limited liability company, limited liability partnership, public
benefit corporation, institution, entity or government (whether Federal, state,
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county, city or otherwise, including without limitation, any instrumentality,
political subdivision, agency, body or department thereof).
"Related Agreements" means the Option, the Shareholders' Agreement, the
CRI Registration Rights Agreement, the Fidelity Registration Rights Agreement
and any and all other documents contemplated herein or therein.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder, all as the same shall
be in effect at the time.
"Taxes" means any income, excise, sales, use, stamp or franchise taxes
and any other taxes, fees, duties, levies, withholdings or other charges of any
nature whatsoever imposed by any taxing authority, whether Federal, state, local
or foreign, together with any interest and penalties and additions to tax.
"Transferee" means any direct or indirect transferee of all or any part
of the Option.
2. PURCHASE AND SALE OF THE SHARES AND OPTION.
2.1 Authorization. Seller is fully authorized and is not subject
to any restrictions effecting (i) the sale and transfer to the Purchaser of the
Shares, (ii) the sale and delivery to the Purchaser of the Option, and (iii) the
reservation for issuance of the Common Stock issuable upon exercise of the
Option. The Shares and the Option, and the certificates and other instruments
from time to time evidencing the same, are herein sometimes collectively
referred to as the "Securities."
2.2 Purchase of Securities; Purchase Price. Subject to the terms
and conditions contained herein, and in reliance upon the representations,
warranties and agreements contained herein, the Seller shall sell, transfer
and/or deliver to the Purchaser, the Securities. At the Closing (as defined
below), Purchaser shall pay Seller an aggregate combined purchase price for the
Securities equal to $5,800,000 (the "Purchase Price"), as follows: (i) an
aggregate of $2,050,000 shall be paid to Seller by delivery of cashier's
check(s) or wire transfer(s) to the accounts designated by Seller (the "Cash
Payment"), and (ii) an additional aggregate of $3,750,000 of the Purchase Price
shall be paid by delivery of certificate(s) in such name(s) designated by Seller
and representing an aggregate of One Hundred Seven Thousand One Hundred
Forty-Three (107,143) shares of Common Stock of the Purchaser ("Fidelity
Shares"), based on a per share value of $35.00.
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3. CLOSING.
3.1 Time and Place. The sale of the Securities shall be
consummated at a closing (the "Closing") to be held at the offices of Xxxxxxxxx
Xxxxx Xxxxxxx & Xxxxx (SYC&R), 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000, at 10:00 a.m. on the first business day immediately
following the waiver or satisfaction of all of the conditions precedent to the
obligations of the respective parties to the Agreement, or at such other time
and date as shall be agreed upon by the parties in writing (the "Closing Date").
3.2 Deliveries. At the Closing, Seller shall deliver (i) to the
Purchaser (A) his certificate or certificates representing the Shares, together
with a duly executed assignment separate from certificate with respect to each
such certificate, and (B) the Option, duly executed by Seller; and (ii) to
SYC&R, executed escrow instructions, substantially in the form of Exhibit B
hereto (the "Escrow Instructions"), appointing SYC&R as escrow agent with
respect to the Option, and his certificate representing the shares of Common
Stock initially issuable upon exercise of the Option, together with a duly
executed assignment separate from certificate with respect to such certificate.
At the Closing, the Purchaser shall deliver (i) to the Seller the Purchase Price
(in the manner set forth in Section 2 hereof); and (ii) to SYC&R, the Escrow
Instructions, duly executed by or on behalf of Purchaser. Thereafter, each
party, at the request of any other party, shall execute and deliver such
additional or confirmatory instruments, documents of conveyance, and
acknowledgements and shall take all such other actions and execute such other
documents as such requesting party may reasonably require to effect the
transactions contemplated hereunder.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND SELLER. The Company
and Seller, to his best knowledge, hereby jointly and severally represent and
warrant to the Purchaser that, except as set forth in the disclosure schedules
attached hereto (the "Disclosure Schedules"), the following statements are true
and correct as of the date hereof (it being understood that wherever, in this
Agreement, reference is made to a matter being to the "knowledge" of the
Company, the term "knowledge" shall mean that the officer(s) of the Company
negotiating and entering into this Agreement on its behalf actually knew or,
with reasonable inquiry, should have known, about the matter in question):
4.1 Organization and Good Standing. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated, and has all requisite corporate power
and authority to own (or hold under lease) and operate its properties, to carry
on its business as now conducted, to enter into this Agreement and each Related
Agreement, and to consummate the transactions contemplated hereby and thereby.
The Company is duly qualified as a foreign corporation to do business and is in
good standing wherever necessary to carry on its present business and
operations, except where the failure to so qualify would not have a Material
Adverse Effect.
4.2 Capitalization. The authorized capital stock of the Company
consists of 20,000,000 shares of Common Stock, par value no par value per share,
of which 2,933,372 shares are issued and outstanding, and 10,000,000 shares of
Preferred Stock, par value $10 per share, of which 79,630 shares are designated
Series C Preferred Stock, of which 79,630 shares are issued and outstanding. All
presently outstanding shares of the Company's capital stock are duly authorized,
validly issued and outstanding, fully paid and nonassessable, and are not
subject to any preemptive
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rights in respect thereof. Except for outstanding options to purchase 706,500
shares of Common Stock, there are no outstanding options, warrants, or other
rights to subscribe for or purchase, from the Company, any securities or
obligations that are convertible into or exchangeable for, or any contracts or
commitments providing for the issuance of or the granting of rights to acquire,
any Common Stock or any other capital stock, or other ownership interest, in the
Company. Schedule 4.2 attached hereto sets forth the names of the holders of the
Company's Common Stock, and the number of shares of Common Stock held by each
such holder.
4.3 Authorization. The execution, delivery and performance of
this Agreement and of each of the Related Agreements, and the consummation of
the transactions contemplated hereby and thereby have been duly authorized by
all necessary corporate action on the part of the Company.
4.4 Due Execution and Delivery; Binding Obligations. This
Agreement has been duly executed and delivered by the Company. This Agreement
is, and at the time of the Closing each of the Related Agreements will be,
legal, valid and binding obligations of the Company enforceable against the
Company in accordance with their respective terms except as enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or conveyance or similar law, relating to or limiting creditors' rights
generally or by equitable principles relating to enforceability and except as
rights of indemnity or contribution may be limited by Federal or state
securities or other law, or the public policy underlying such laws.
4.5 No Violation. The execution, delivery and performance by the
Company of this Agreement and of each of the Related Agreements, and the
consummation of the transactions contemplated hereby and thereby do not violate
(i) the charter or bylaws of the Company, (ii) to the knowledge of the Company,
any material law, rule, regulation or ordinance applicable to the Company, (iii)
any order, ruling, judgment or decree of any court or other governmental agency
binding on the Company, (iv) any material term of any indenture or mortgage to
which the Company is a party, or (v) any term of any material lease, agreement
or instrument to which the Company is a party.
4.6 Governmental Consents. The execution and delivery by the
Company of this Agreement and of each of the Related Agreements, and the
consummation of the transactions contemplated hereby and thereby, do not and
will not require as of the Closing any authorization, registration or filing
with, or consent or approval of, any Federal, state or other governmental
authority or regulatory body.
4.7 Financial Statements. The Company has delivered to the
Purchaser copies of (i) the audited balance sheets of the Company as of June 30,
1995, 1996 and 1997 and the related audited statements of operations,
shareholders' equity, and cash flows for the years ended June 30, 1995, 1996 and
1997, together with the unqualified report thereon of the Company's auditors and
(ii) the unaudited balance sheet of the Company as of December 31, 1997 and the
related unaudited income statements for the six-month period then ended
(collectively, the "Financial Statements"). The Financial Statements (i) were
prepared in accordance with the books and records of the Company, (ii) present
fairly the financial position of the Company as of the dates indicated and its
results of operations for the periods indicated, and (iii) have been prepared in
conformity with GAAP. Since June 30, 1997, there has been no material adverse
change in the financial condition, assets, liabilities, earnings, business or
prospects of the Company.
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4.8 Material Liabilities. The Company has no material liabilities
or obligations, absolute or contingent (individually or in the aggregate),
except (i) liabilities and obligations reflected in the Financial Statements and
the related Notes thereto, (ii) liabilities and obligations which have been
incurred subsequent to June 30, 1997 in the ordinary course of business and
(iii) liabilities and obligations which would not have a Material Adverse Effect
on the Company.
4.9 Changes. Except in the ordinary course of the Company's
business or as set forth on Schedule 4.9, since June 30, 1997 there has not been
(a) any material damage, destruction or loss to any material asset of the
Company, whether or not covered by insurance; (b) any waiver by the Company of a
valuable right or of a debt owed to it; (c) any satisfaction or discharge of any
Lien or payment of any material obligation by the Company; (d) any change or
amendment to any material contract or arrangement by which the Company or any of
its properties or assets is bound or subject; (e) any material adverse change in
the assets, liabilities, financial condition or operations of the Company; (f)
any declaration or payment of any dividend or other distribution of assets of
the Company to its shareholders as a group, or the adoption or consideration of
any plan or arrangement with respect thereto; (g) any resignation or termination
of employment of any director or key employee of the Company or any notice or
indication that any resignation or termination is anticipated; (h) any
investment by the Company in the capital stock of a Person, except as a result
of underwriting, investment banking and market making activities in the ordinary
course of business and consistent with past practice; (i) any offer, issuance or
sale of shares of capital stock; (j) any material change in the Company's
accounting methods, procedures or policies; (k) any incurrence of Indebtedness;
(l) any other event or condition of any character which has or could reasonably
be expected to have a Material Adverse Effect; or (m) any agreement or
commitment to do any of the foregoing.
4.10 Labor Agreements and Actions. The Company is not bound by or
subject to any written or oral, express or implied, contract, commitment or
arrangement with any labor union, and no labor union has requested or sought to
represent any of the employees, representatives or agents of the Company. There
is no strike or other labor dispute, including, but not limited to, any unfair
labor practice, charge or other proceeding before the National Labor Relations
Board, involving the Company pending or, to the Company's knowledge, threatened.
To the Company's knowledge, there is no labor organization activity involving
the employees of the Company and no officer or key employee, or any group of
officers or key employees, intends to terminate his or her or their employment
with the Company. Except as disclosed in Schedule 4.14, the Company is not aware
of any claims, actions, proceedings or threats relating to sexual harassment,
wrongful termination, discrimination or any other employment related matter. To
the Company's knowledge there is no fact or circumstance which is reasonably
expected to, with the passage of time or otherwise, cause this representation
and warranty to be no longer true and correct. To the Company's knowledge, the
Company is in compliance with all provisions of the Fair Labor Standards Act,
all state wage and hour laws and all workers' compensation laws.
4.11 Employee Benefit Plans; ERISA. All pension, retirement,
bonus, profit sharing, stock option, employee and other benefit or welfare plans
or arrangements maintained by the Company, or to which the Company contributes
or is required to contribute, to the extent required, materially comply with the
provisions of and have been administered and maintained in material compliance
with the provisions of ERISA and all other applicable laws. The Company does not
currently maintain any, nor in the past has ever maintained any, "employee
pension benefit plan" within the meaning of Section 3(2) of ERISA, and the
Company does not currently contributes to, nor
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in the past has ever contributed to, any "Multiemployer Plan," as defined in
Section 4001(a)(3) of ERISA. All unpaid liabilities of the Company with respect
to, and all unfunded benefits (whether vested or not) under, each employee
welfare benefit plan as defined in Section 3(1) of ERISA maintained by the
Company have been calculated and are reflected in the Company's financial
statements in accordance with GAAP, and any such liabilities incurred after the
date of such financial statements will be incurred in the ordinary course of
business, determined in a manner substantially similar to that used in such
financial statements.
4.12 Taxes. The Company has timely filed within required time
periods, including permitted extensions, all Federal, state and other Tax
returns required to have been filed and has paid all Taxes which have become due
and payable except (i) such as are being contested in good faith by appropriate
proceedings (to the extent that any such proceedings are required) and (ii) as
may be determined to be owed upon completion of any Tax return not yet filed
based upon an extension of time to file provided all periodic estimated Tax
payments have been made. The Company has withheld and paid all Taxes required to
be withheld and paid in connection with amounts paid or owing to any employee,
creditor, shareholder or other third party. The Company has not been advised
that any Tax returns, Federal, state or other, have been or are being audited.
There are no agreements, waivers or other arrangements providing for an
extension of time with respect to the assessment of any Taxes or deficiency
against the Company, nor are there any actions, suits, proceedings or claims now
pending against the Company in respect of any Taxes or assessments. There is no
pending or threatened investigation of the Company by any Federal, state,
foreign or local authority relating to any Taxes or assessments, or any claims
for additional taxes or assessments asserted by any such authority. The Company
is not a party to or bound by any tax sharing, tax indemnity or tax allocation
agreement or other similar arrangement.
4.13 Compliance with Charter, Applicable Laws and Material
Contracts. Except as set forth on Schedule 4.13, the Company has been, and is,
in compliance with, and is not in violation of the terms of: (i) its charter or
bylaws as in effect on the date hereof, (ii) to the Company's knowledge, any
Applicable Law, the noncompliance with which would have a Material Adverse
Effect on the Company, or (iii) any material indenture, mortgage, deed of trust,
bank loan, credit agreement, lease, agreement or instrument to which the Company
is a party and, in each case, there does not exist any event or circumstance,
that, individually or in the aggregate, with the giving of notice or the lapse
of time or both, would constitute any such noncompliance or violation and would
have a Material Adverse Effect.
4.14 Litigation; Adverse Facts. To the Company's knowledge,
except as set forth on Schedule 4.14 or disclosed in the Financial Statements
and the related Notes thereto, there are no actions, suits, proceedings or
investigations at law or in equity of which the Company has received notice or
otherwise has knowledge pending before or by any Federal, state, municipal,
governmental or self-regulatory department, court, board, bureau, agency,
instrumentality or organization or, to the Company's knowledge, threatened
against or affecting the Company, nor is there any judgment, decree, injunction,
ruling or order of any public body against the Company. To the Company's
knowledge, there is no fact or circumstance which could give rise to any action,
suit, proceeding or investigation which could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
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4.15 Licenses, Permits and Authorizations. The Company has all
Licenses and Permits necessary to the conduct of its business, except where the
failure to have such Licenses and Permits, individually or in the aggregate,
would not have a Material Adverse Effect. All such Licenses and Permits are in
full force and effect. The properties, assets, operations and business of the
Company are, and at all times have been maintained and conducted, in compliance
with all Licenses and Permits.
4.16 Leases. With respect to each lease and sublease necessary in
any material respect for the operation of the Company's business, (a) each such
lease or sublease is legal, valid, binding, enforceable and in full force and
effect; (b) to the Company's knowledge, no party to the lease or sublease is in
breach or default, and no event has occurred which, with notice or lapse of
time, would constitute a breach or default or permit termination, modification
or acceleration thereunder; (c) there are no disputes, oral agreements or
forbearance programs in effect as to the lease or sublease; (d) the Company has
not assigned, transferred, conveyed, mortgaged, deeded in trust or encumbered
any interest in the leasehold or subleasehold; and (e) there are no restrictions
in the lease or sublease which prohibit the sale, transfer and delivery of the
Securities, prohibit or restrict any merger, sale of assets or other event which
could cause a change in control of the Company, or otherwise restrict or
prohibit any other financings by the Company, including, without limitation, any
public or private debt or equity financings.
4.17 Powers of Attorney. There are no outstanding powers of
attorney executed on behalf of the Company.
4.18 Insurance. The Company is covered by insurance in scope and
amount customary and reasonable for the businesses in which it is engaged and
will be so covered after consummation of the transactions contemplated hereby.
All such policies are in full force and effect.
4.19 Books and Records. The minute books and other similar
records of the Company contain true and complete records, in all material
respects, of all actions taken at any meetings of its shareholders, Board of
Directors or any committees thereof and of all written consents executed in lieu
of the holding of any such meeting. The books and records of the Company
accurately reflect the assets, liabilities, business, financial condition and
results of operations of the Company, in all material respects, and have been
maintained in accordance with good business, accounting and bookkeeping
practices.
4.20 Outstanding Indebtedness. Except as otherwise disclosed on
Schedule 4.20, the Company is not in monetary or other material default in the
performance or observance of any of the terms, covenants or conditions contained
in any instrument or agreement evidencing the Indebtedness of the Company or
pursuant to which such Indebtedness was issued or secured and has not requested
any waiver in respect of any default and no event has occurred and is continuing
which, with notice or the lapse of time or both, would constitute such a
default.
4.21 Employment and Agency Agreements. Schedule 4.21 attached
hereto sets forth a summary description of the current terms of employment for
each of the Company's executive officers. To the Company's knowledge, each
material employment, agency, independent contractor and sales representative
agreement and each noncompetition, nondisclosure and confidentiality agreement
to which the Company is a party constitutes a valid and binding agreement
enforceable in accordance with its terms, and, to the Company's knowledge, no
party to any such agreement is in
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14
breach of, or in default with respect to, its obligations under such agreement
nor is the Company aware of any facts or circumstances which might reasonably be
expected to give rise to a breach or default thereunder.
4.22 Net Capital. The Company is now, and has at all times since
January 1, 1992 been, in compliance with applicable Net Capital and other
regulatory requirements as they pertain to the Company's operations.
4.23 Disclosure. No representation, warranty or other statement
of the Company to the Purchaser included in this Agreement or any Related
Agreement or in any Exhibit or other Schedule thereto is, or will be at the
Closing, untrue with respect to any material fact or omits, or will omit, to
state a material fact necessary in order to make the statement made herein or
therein in light of the circumstances in which such statement was made, not
misleading.
5. REPRESENTATIONS AND WARRANTIES OF THE SELLER. Seller hereby
represents and warrants to the Purchaser that the following statements are true
and correct as of the date hereof:
5.1 Ownership. Seller is the record and beneficial owner of the
Shares. All of such Shares and held free and clear of all liens, encumbrances,
claims, security interests, options and charges of any kind created by or under
the Seller. Upon the Closing, the Purchaser shall receive the Securities free
and clear of all liens, encumbrances, claims, security interests, options and
charges of any kind.
5.2 Authorization. Seller has the full right, power and authority
to sell, transfer and deliver the Securities and has duly authorized the
execution, delivery and performance of this Agreement and of each of the Related
Agreements, the sale, transfer and delivery of the Securities, and the
consummation of the transactions contemplated hereby and thereby.
5.3 Due Execution and Delivery; Binding Obligations. This
Agreement has been duly executed and delivered by Seller. This Agreement is, and
at the time of the Closing each of the Related Agreements will be, legal, valid
and binding obligations of Seller enforceable against Seller in accordance with
their respective terms except as enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or conveyance or
similar law, relating to or limiting creditors' rights generally or by equitable
principles relating to enforceability and except as rights of indemnity or
contribution may be limited by Federal or state securities or other law, or the
public policy underlying such laws.
5.4 No Violation. The execution, delivery and performance by
Seller of this Agreement and of each of the Related Agreements, the sale,
transfer and delivery of the Securities, and the consummation of the
transactions contemplated hereby and thereby do not violate (i) to the knowledge
of Seller, any material law, rule, regulation or ordinance applicable to Seller,
(ii) any order, ruling, judgment or decree of any court or other governmental
agency binding on Seller, (iii) any material term of any agreement or instrument
to which Seller is a party.
5.5 Governmental Consents. The execution and delivery by Seller
of this Agreement and of each of the Related Agreements, the sale, transfer and
delivery of the Securities, and the consummation of the transactions
contemplated hereby and thereby, do not and will not require as
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of the Closing any authorization, registration or filing with, or consent or
approval of, any Federal, state or other governmental authority or regulatory
body.
5.6 Investment Representations.
5.6.1 Seller is acquiring the Fidelity Shares for his own
account, not as nominee or agent, for investment and not with a view to, or for
resale in connection with, any distribution or public offering thereof within
the meaning of the Securities Act.
5.6.2 Seller understands that (A) the Fidelity Shares have
not been registered under the Securities Act by reason of a specific exemption
therefrom, that they must be held by it indefinitely, and that it must,
therefore, bear the economic risk of such investment indefinitely, unless a
subsequent disposition thereof is registered under the Securities Act or is
exempt from such registration; (B) each certificate representing the Fidelity
Shares will be endorsed with the following legend:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, (THE "SECURITIES ACT") AND
MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT COVERING
SUCH SECURITIES OR IF THE PURCHASER RECEIVES AN OPINION OF COUNSEL FOR
THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO PURCHASER,
STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT
FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE
SECURITIES ACT."
and (C) Purchaser will instruct any transfer agent not to register the transfer
of any of the Fidelity Shares unless the conditions specified in the foregoing
legend are satisfied; provided, however, that no such opinion of counsel shall
be necessary if the sale, transfer or assignment is made pursuant to Rule 144 of
the Securities Act and such Seller provides Purchaser with evidence reasonably
satisfactory to Purchaser and its counsel that the proposed transaction
satisfies the requirements of Rule 144. Purchaser agrees to remove the foregoing
legend from any securities if the requirements of Rule 144(k) of the Securities
Act (or any successor rule or regulation) apply with respect to such securities
and Purchaser and its counsel are provided with reasonably satisfactory evidence
that the requirements of Rule 144(k) apply.
5.6.3 Seller can bear the economic risk of its investment
and has such knowledge and experience in financial or business matters that it
is capable of evaluating the merits and risks of the investment in the Fidelity
Shares.
5.6.4 Seller is an "accredited investor" within the
meaning of Rule 501 of Regulation D of the Securities Act, as presently in
effect.
5.6.5 Seller understands that the Fidelity Shares are
characterized as "restricted securities" under the federal securities laws
inasmuch as they are being acquired from Purchaser in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act,
only in certain
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limited circumstances, and such Seller represents that he is familiar with Rule
144, as presently in effect, and understands the resale limitations imposed
thereby and by the Securities Act.
5.6.6 Seller's principal address is as set forth in
Section 11.8 hereof, and Seller does not reside in any state of the United
States other than the state specified in its address thereon.
5.7 Disclosure. No representation, warranty or other statement of
Seller included in this Agreement or any Related Agreement or in any Exhibit or
other Schedule thereto is, or will be at the Closing, untrue with respect to any
material fact or omits, or will omit, to state a material fact necessary in
order to make the statement made herein or therein in light of the circumstances
in which such statement was made, not misleading.
6. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The Purchaser hereby
represents and warrants to the Company and to Seller that the following
statements are true and correct as of the date hereof:
6.1 Organization and Good Standing. The Purchaser is a
corporation, duly organized, validly existing and in good standing under the
laws of the State of Delaware, and has all requisite power and authority to
enter into this Agreement and each Related Agreement to which it is a party and
to consummate the transactions contemplated hereby and thereby.
6.2 Authorization. The execution, delivery and performance of
this Agreement and of each of the Related Agreements to which the Purchaser is a
party, and the consummation of the transactions contemplated hereby and thereby,
have been duly authorized by all necessary action on the part of the Purchaser.
6.3 Due Execution and Delivery; Binding Obligations. This
Agreement has been duly executed and delivered by the Purchaser. This Agreement
is, and at the time of the Closing the Related Agreements to which the Purchaser
is a party will be, legal, valid and binding obligations of the Purchaser
enforceable against the Purchaser in accordance with their respective terms,
except as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or conveyance or similar laws relating to or
limiting creditors' rights generally or by equitable principles relating to
enforceability and except as rights of indemnity or contribution may be limited
to Federal or state securities or other laws or the public policy underlying
such laws.
6.4 No Violation. The execution, delivery and performance by the
Purchaser of this Agreement, and of each of the Related Agreements to which the
Purchaser is a party, and the consummation of the transactions contemplated
hereby and thereby do not violate (i) the charter and bylaws of the Purchaser as
in effect on the date hereof, (ii) any law, rule, regulation or ordinance
applicable to the Purchaser, (iii) any order, ruling, judgment or decree of any
court or other governmental agency binding on the Purchaser, or (iv) any term of
any material indenture, mortgage, lease, agreement or instrument to which the
Purchaser is a party.
6.5 Investment Intent. The Purchaser is acquiring the Securities
for its own account, for investment purposes, and not with a view to or for sale
in connection with any distribution thereof. The foregoing notwithstanding, the
disposition of the Securities shall at all times be and
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remain within the Purchaser's control, so long as such disposition complies with
applicable laws and regulations.
6.6 Accredited Investor Status; No Reliance. The Purchaser is an
"accredited investor" (as such term is defined in Rule 501 of Regulation D under
the Securities Act). By reason of its business and financial experience, the
Purchaser has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and risks of the
investment in the Securities and is able to bear the economic risk of such
investment. The Purchaser confirms that the Company has made available to the
Purchaser the opportunity to ask questions of the officers and management of the
Company and to acquire additional information about the business, assets and
financial condition of the Company. Notwithstanding the foregoing, the Purchaser
confirms that in entering into this Agreement and in consummating the
transactions contemplated hereby it has not relied upon any representation,
warranty or other statement, whether written or oral and whether included in any
materials, documents, instruments or financial or other projections provided to
the Purchaser, relating to the Company's business, financial condition or
results of operations, other than those representations and warranties expressly
made by the Company in this Agreement or any Related Agreement or in any Exhibit
or Schedule hereto or thereto.
6.7 Governmental Consents. The execution and delivery by the
Purchaser of this Agreement and each of the Related Agreements to which it is a
party, and the consummation of the transactions contemplated hereby, do not and
will not require any authorization, registration or filing with, or consent or
approval of, any Federal, state or other governmental authority or regulatory
body.
6.8 Litigation; Adverse Facts. There are no actions, suits,
proceedings or investigations at law or in equity pending before or by any
Federal, state, municipal, governmental or self regulatory department, court,
board, bureau, agency, instrumentality or organization threatened against or
affecting the Purchaser which could reasonably be expected to adversely affect
the Purchaser's ability to perform its obligations under this Agreement or
consummate any of the transactions contemplated hereby. The Purchaser is not
aware of any fact or circumstance which could give rise to any action, suit,
proceeding or investigation which could reasonably be expected to adversely
affect the Purchaser's ability to perform its obligations under this Agreement
or consummate any of the transactions contemplated hereby.
6.9 Brokers. The Purchaser has not paid or become obligated to
pay any fee or commission to any broker, finder, investment banker or other
intermediary in connection with this Agreement or any Related Agreement.
6.10 Issuance of Fidelity Shares. The Fidelity Shares will be
fully paid and non-assessable and issued to the Seller free and clear of all
liens, encumbrances, claims, security interests, options and charges of any
kind.
6.11 Reports. No reports, schedules, forms, statements, exhibits
and other documents filed by the Purchaser with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934, as amended (copies
of which have been made available by the Purchaser to the Seller prior to the
date hereof) contains any untrue statement of a material fact, nor omits nor
misstates any material fact, except as qualified or modified by subsequent
reports filed by the Purchaser with the Securities and Exchange Commission or by
other public disclosures.
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6.12 Disclosure. No representation, warranty or other statement
of the Purchaser to the Company included in this Agreement or any Related
Agreement or in any Exhibit or Schedule hereto or thereto or in any other
document or instrument delivered at any time prior to the Closing in connection
herewith or therewith is, or will be at the Closing, untrue with respect to any
material fact or omits, or will omit, to state a material fact necessary in
order to make the statement made herein or therein in light of the circumstances
in which such statement was made, not misleading.
7. CONDITIONS TO THE OBLIGATIONS OF THE PURCHASER. The obligation of the
Purchaser to consummate the transactions contemplated hereby is subject to the
satisfaction, prior to or at the Closing, of the following conditions; provided,
however, that any or all of the following conditions may be waived, in whole or
in part, by the Purchaser in its sole and absolute discretion:
7.1 Representations and Warranties. The representations and
warranties of the Company and the Seller, respectively, contained in this
Agreement and the Related Agreements shall be true and correct in all material
respects at and as of the Closing Date, as if made on and as of such date; the
Company and the Seller shall have performed or satisfied, in all material
respects, all of their respective covenants and agreements hereunder and
thereunder to be performed or satisfied on or prior to the Closing Date. The
Company and the Seller shall each have delivered to the Purchaser a certificate
signed, in the case of the Company, by the President and the Chief Financial
Officer of the Company, and, in the case of the Seller, by the Seller, each
dated the Closing Date, to such effect and to the effect that each of the
conditions set forth in Section 7 has been fulfilled.
7.2 Purchase Permitted by Applicable Laws. The consummation of
the transactions contemplated hereby and by the Related Agreements shall not be
prohibited by or violate any law, governmental or self-regulatory rule or
regulation or similar constraint and shall not subject any party to any Tax,
penalty or liability, under or pursuant to any, applicable law or governmental
regulation, and shall not be enjoined (temporarily or permanently) under, or
prohibited by or contrary to, any injunction, order or decree. Without limiting
the generality of the foregoing, the consummation of the transactions
contemplated hereby and by the Related Agreements shall otherwise comply with
all applicable requirements of Federal and state securities laws.
7.3 No Material Adverse Changes. There shall not have occurred
any material adverse change in the condition (financial or otherwise), business,
results of operations, prospects, assets or properties of the Company.
7.4 No Material Judgment or Order. There shall not be any
judgment or order of a court of competent jurisdiction or any ruling of any
agency of the Federal or any state or local government or self-regulatory
organization which, in the judgment of the Purchaser, would prohibit the
delivery of the Securities or subject the Purchaser to any penalty if the
Securities were to be delivered hereunder.
7.5 Securities. The Company shall have duly authorized, executed
and delivered to the Purchaser the Securities in favor of the Purchaser.
7.6 Shareholders' Agreement. The Company, the Purchaser and
certain other holders of the Company's Common Stock shall have duly entered into
the Shareholders' Agreement in substantially the form attached as Exhibit C
hereto (the "Shareholders' Agreement").
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7.7 CRI Registration Rights Agreement. The Company, the Purchaser
and certain other holders of the Company's Common Stock shall have duly entered
into the Cruttenden Xxxx Incorporated Registration Rights Agreement in
substantially the form attached as Exhibit D hereto (the "CRI Registration
Rights Agreement").
7.8 Payment of Taxes. The Company shall have paid all Taxes due
and payable by the Company prior to the Closing, except such as are being
contested in good faith by appropriate proceedings (to the extent that any such
proceedings are required) and such Taxes as the failure to pay would not have a
Material Adverse Effect.
7.9 Escrow Instructions. The Company shall have duly authorized,
executed and delivered to SYC&R the Escrow Instructions.
7.10 Financial Statements. The Company shall have furnished to
the Purchaser a copy of the Company's audited financial statements as of and for
the fiscal year ended June 30, 1997, accompanied by a copy of an unqualified
audit report of the Company's independent certified public accounts and a copy
of the Company's unaudited financial statements as of and for the six-month
period ended December 31, 1997.
7.11 Third Party Consents. The Company shall have obtained from
third parties such material consents, approvals and authorizations which the
Company is required to obtain under the provisions of any agreement, contract or
undertaking to which the Company is a party or by which its assets and
properties are bound in order to consummate each of the transactions
contemplated by this Agreement and the Related Agreements, including, without
limitation, appropriate waivers of all lessors under real property leases and
consents of lessors under personal property leases, to the extent required.
8. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY AND THE SELLER. The
respective obligations of the Company and the Seller to consummate the
transactions contemplated hereby is subject to the satisfaction, prior to or at
the Closing, of the following conditions; provided, however, that any or all of
the following conditions may be waived, in whole or in part, by the Company in
its sole and absolute discretion:
8.1 Representations and Warranties. The representations and
warranties of the Purchaser contained in this Agreement shall be true in all
material respects at and as of the Closing Date after giving effect to the
transactions contemplated by this Agreement, as if made on and as of such date,
and the Purchaser shall have performed or satisfied all of its covenants and
agreements hereunder to be performed or satisfied on or prior to the Closing
Date.
8.2 Purchase Permitted by Applicable Laws. The consummation of
the transaction contemplated hereby shall not be prohibited by or violate any
law, governmental regulation or similar constraint and shall not subject any
party to any Tax, penalty or liability, under or pursuant to any applicable law
or governmental regulation, and shall not be enjoined (temporarily or
permanently) under, or prohibited by or contrary to, any injunction, order or
decree. Without limiting the generality of the foregoing, the consummation of
the transactions contemplated hereby shall otherwise comply with all applicable
requirements of Federal and state securities laws.
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8.3 No Material Judgment or Order. There shall not be any
judgment or order of a court of competent jurisdiction or any ruling of any
agency of the Federal or any state or local government or self-regulatory
organization which, in the reasonable judgment of the Company, would prohibit
the delivery of the Securities or subject the Company to any material penalty if
the Securities were to be delivered hereunder.
8.4 Third Party Consents. The Purchaser shall have obtained from
third parties such material consents, approvals and authorizations which the
Purchaser is required to obtain under the provisions of any agreement, contract
or undertaking to which the Purchaser is a party or by which its assets and
properties are bound in order to consummate each of the transactions
contemplated by this Agreement and the Related Agreements, including, without
limitation, appropriate waivers of all lessors under real property leases and
consents of lessors under personal property leases, to the extent required.
8.5 Fidelity Registration Rights Agreement. The Purchaser and the
Seller shall have duly entered into the Fidelity National Financial, Inc.
Registration Rights Agreement in substantially the form attached as Exhibit E
hereto (the "Fidelity Registration Rights Agreement").
8.6 Escrow Instructions. The Purchaser shall have duly
authorized, executed and delivered to SYC&R the Escrow Instructions.
9. TERMINATION.
9.1 Failure of Condition. If any of the conditions precedent to
the parties respective obligations hereunder is not met and is not waived on or
prior to the Closing Date, the Purchaser or the Company and the Seller, as the
case may be, at their respective options, without prejudice to any rights they
may have to recover damages for breach of this Agreement, may terminate this
Agreement by delivering written notice of termination to the other party.
9.2 Effect of Termination. Upon the termination of this Agreement
pursuant to this Section 9, all further obligations of the parties to this
Agreement and the other agreements contemplated hereby shall terminate without
further liability of any party to any other party hereto, provided that (i)
termination of this Agreement shall not relieve any party of any liability for a
breach of this Agreement or for any intentional misrepresentation or intentional
failure to comply with any agreement or covenant hereunder, and (ii) such
termination shall not be deemed a waiver of any available remedy for any such
breach, intentional misrepresentation or intentional failure to comply with any
agreement or covenant.
10. POST-CLOSING OBLIGATIONS.
10.1 Use of Proceeds. Seller covenants that, as soon as
practicable after the Closing and receipt of the Purchase Price, Seller shall
disburse or cause to be disbursed to the Company from the proceeds of the sale
of Securities hereunder the following amounts:
10.1.1 approximately $93,000, to discharge Seller's
obligations for principal and interest due on the Promissory Note dated January
30, 1996 issued by Seller in favor of the Company;
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10.1.2 approximately $205,000, to discharge Seller's
obligations for the unpaid balance of the amount due under the Subscription and
Security Agreement dated March 29, 1996; and
10.1.3 approximately $563,500, representing the aggregate
purchase price in connection with the exercise by Seller of his outstanding
options (the "Outstanding Options") to acquire 230,000 shares of the Company's
Common Stock, in accordance with the terms and conditions applicable thereto, at
the original exercise price of $2.63 for 200,000 of the Outstanding Options and
$1.25 for 30,000 of the Outstanding Options, plus an amount equal to the
withholding taxes due on the 200,000 Outstanding Options constituting
nonqualified options under the Internal Revenue Code. The Company represents
that the Outstanding Options shall be fully vested at the Closing Date and, upon
exercise of the Outstanding Options and payment therefor by Seller, the Company
shall issue shares of Common Stock underlying the Outstanding Options to Seller,
all of which shares shall be duly and validly issued, fully paid and
nonassessable shares, free and clear of any claims, mortgages, pledges, liens,
charges or other encumbrances caused or created by the Company.
10.2 Disclosure of Subsequent Events. Subsequent to the execution
and delivery of this Agreement and prior to the exercise in full of the Option,
the Company shall notify the Purchaser in writing in the event that that any of
the representations and warranties contained in this Agreement or made in
connection herewith is no longer accurate or complete as a result of a new fact
or changed circumstance.
11. MISCELLANEOUS.
11.1 Indemnification. Each party hereto (the "Indemnifying Party"
herein) agrees to defend (with counsel reasonably satisfactory to such party),
protect, indemnify and hold harmless the other party, each affiliate or
subsidiary of such other party, and each of its respective officers, directors,
employees, attorneys and agents (each an "Indemnified Party" herein) from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any kind
or nature (including, without limitation, the disbursements and the reasonable
fees of counsel for each Indemnified Party in connection with any investigative,
administrative or judicial proceeding, whether or not the Indemnified Party
shall be designated a party thereto), which may be imposed on, incurred by, or
asserted against, any Indemnified Party (whether direct, indirect or
consequential and whether based on any federal, state or local laws or
regulations including, without limitation, securities, environmental and
commercial laws and regulations, under common law or in equity, or based on
contract or otherwise) in any manner relating to or arising out of this
Agreement, the Related Agreements, or any other agreement, act, event or
transaction related or attendant hereto or thereto; provided, however, that the
Indemnifying Party shall have no obligation hereunder to any Indemnified Party
with respect to matters caused by or resulting from the willful misconduct or
gross negligence of such Indemnified Party. To the extent that the undertaking
to indemnify set forth in the preceding sentence may be unenforceable because it
is violative of any law or public policy, the Indemnifying Party shall satisfy
such undertaking to the maximum extent permitted by applicable law. Any
liability, obligation, loss, damage, penalty, cost or expense covered by this
indemnity shall be paid to each Indemnified Party on demand, and, failing prompt
payment, shall accrue interest thereon from the date incurred by each
Indemnified Party until paid. The provisions of this Section 11.1 shall survive
the satisfaction of the other obligations herein and the termination of this
Agreement.
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11.2 Attorneys' Fees. In the event of any litigation between the
parties hereto arising out of or relating to this Agreement, or the breach
thereof, the prevailing party shall be entitled to recover from the other party,
in addition to whatever other remedies such prevailing party may be entitled,
reasonable attorneys' fees, expenses and costs.
11.3 Entire Agreement. Except as otherwise set forth herein, this
Agreement embodies the entire agreement and understanding of the parties hereto
with respect to the subject matter contained herein. There are no restrictions,
promises, warranties, covenants, or undertakings, other than those expressly set
forth or referred to herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
11.4 Headings. The subject headings of the sections and
subsections of this Agreement are included for purposes of convenience only and
shall not affect the construction or interpretation of any of its provisions.
11.5 Successors and Assigns. All covenants and agreements
contained in this Agreement by or on behalf of any of the parties hereto will
bind and inure to the benefit of the respective successors and assigns of the
parties hereto whether so expressed or not.
11.6 Parties in Interest. Nothing in this Agreement is intended
to confer any rights or remedies under or by reason of this Agreement on any
persons other than the parties to it and their respective successors and
permitted assigns. Nothing in this Agreement is intended to relieve or discharge
the obligation or liability of any third persons into any party to this
Agreement. No provision of this Agreement shall give any third person any right
of subrogation or action over or against any party to this Agreement.
11.7 Amendments, Waivers and Consents. This Agreement shall not
be amended except in a writing signed by the parties hereto. No waiver or
consent shall be binding except in a writing signed by the party making the
waiver or giving the consent. No waiver of any provision or consent of any
action shall constitute a waiver of any other provision or consent of any other
action, whether or not similar. No waiver or consent shall constitute a
continuing waiver or consent except to the extent specifically set forth in
writing.
11.8 Notice. Any notice, instruction or communication required or
permitted to be given under this Agreement to any party shall be in writing
(which may include telex, telegram, telecopier or other similar form of
reproduction) and shall be deemed given when actually received by the applicable
party at the addresses indicated below:
If to the Company:
Cruttenden Xxxx Incorporated
00000 Xxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxx, President
Telecopy: (000) 000-0000
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with a copy to:
Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
Telecopy: (000) 000-0000
If to the Seller:
Xxxxxx X. Xxxxxxxxxx III
0 Xxxxxx Xxx Xxxxx
Xxxxxx Xxx Xxx, Xxxxxxxxxx 00000
with a copy to:
Xxxxx X. Xxxxxxxx, Esq.
The Xxxxx Firm
0000 Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000
Telecopy: (000) 000-0000
If to the Purchaser:
Fidelity National Financial, Inc.
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx,
Executive Vice President
Telecopy: (000) 000-0000
with a copy to:
Xxxxxxxxx Xxxxx Xxxxxxx & Xxxxx
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: C. Xxxxx Xxxxxxx, Esq.
Telecopy: (000) 000-0000
A party may change his or its address for purposes of this
section by giving the other party written notice of the new address in the
manner set forth above.
11.9 Transaction Fees and Expenses. Except as stated herein, each
party hereto agrees to pay its own costs and expenses in connection with the
preparation, execution and delivery of this Agreement and the transactions
contemplated hereby. Notwithstanding the foregoing, the Company will pay
directly (in accordance with statements delivered on or prior to the Closing by
third party service providers who have represented the Sellers in connection
with this transaction) or reimburse the Sellers upon demand for all
out-of-pocket costs and expenses (including fees and expenses of counsel) in
connection with the preparation, execution and delivery of this Agreement and
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the consummation of the transactions contemplated hereby; provided that, the
amounts paid and reimbursed shall not, in the aggregate, exceed $5,000.
11.10 Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
11.11 Counterparts. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
11.12 Waiver of Jury Trial. BECAUSE DISPUTES ARISING IN
CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY
RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE
STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.
THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL
SYSTEM AND OF ARBITRATION AND UNDERSTANDING THEY ARE WAIVING A CONSTITUTIONAL
RIGHT, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT,
OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER IN CONTRACT, TORT OR
OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO, THIS
AGREEMENT, THE SECURITIES AND/OR ANY RELATED AGREEMENT OR THE TRANSACTIONS
COMPLETED HEREBY OR THEREBY.
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25
IN WITNESS WHEREOF, the parties to this Agreement have duly executed it
on the day and year first above written.
"SELLER"
/s/ Xxxxxx X. Xxxxxxxxxx III
-------------------------------------------
Xxxxxx X. Xxxxxxxxxx III
"COMPANY"
CRUTTENDEN XXXX, INCORPORATED,
a California corporation
By: /s/ Xxxxx X. Xxxx
--------------------------------------
Xxxxx X. Xxxx, President
"PURCHASER"
FIDELITY NATIONAL FINANCIAL, INC.
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Xxxxxx X. Xxxxxx,
Executive Vice President
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