CONTRIBUTION AGREEMENT
This Contribution Agreement (this "Agreement"), dated as of January 31,
1998, is entered into by Xxxxx Xxxxxxxxx ("Stockholder"), and Commercial Assets,
Inc., a Maryland corporation (the "Company"). The Stockholder and the Company
are collectively referred to in this Agreement as the "Parties", and each a
"Party."
WHEREAS, Stockholder owns free and clear an aggregate of ______ shares of
Common Stock, par value $0.01 per share (the "Shares"), of CAII Holdings, Inc.,
a Delaware corporation (the "Entity"); and
WHEREAS, Stockholder and Company intend for this Agreement to set forth the
terms and conditions upon which Stockholder is agreeing to contribute and
deliver to Company, and Company is agreeing to acquire from Stockholder, the
Shares, free and clear of all liabilities, obligations, claims, liens, options,
charges, encumbrances and restrictions of any kind whatsoever, except that the
Company agrees that upon the satisfaction of certain conditions to distribute
the Shares to the stockholders of the Company;
NOWTHEREFORE, in consideration of the covenants, representations,
warranties and agreements contained herein and intending to be legally bound
hereby, the Parties hereto agree as follows:
I. CONTRIBUTION OF SHARES
1.1. SHARES TO BE CONTRIBUTED. Upon the terms and subject to the
conditions of this Agreement, at the Closing provided for in Section 1.3
hereof (the "Closing"), Stockholder will assign and deliver to Company, and
Company will acquire from Stockholder, good, valid and marketable title to
the Shares, free and clear of all liabilities, obligations, claims, liens,
options, charges, encumbrances and restrictions of any kind whatsoever,
except for the restrictions set forth herein and the restrictions which will
be set forth in the Dividend Agreement. On the Closing Date, Stockholder will
deliver to Company a stock certificate or certificates representing the
Shares, duly endorsed or accompanied by stock powers duly executed in blank,
and otherwise in proper form for transfer on the books of the Entity,
together with stamps or other evidence for any applicable stock transfer tax
or provision for payment thereof, all in a form satisfactory to Company.
1.2. CONSIDERATION. Upon the terms and subject to the conditions of
this
Agreement, in reliance on the representations, warranties and agreements of
Stockholder contained herein, and in full consideration of the aforesaid
assignment and delivery of the Shares, the Company shall (i) deliver or cause to
be delivered to Stockholder at the Closing cash of $1.00 and (ii) shall enter
into an agreement with Stockholder satisfactory to Stockholder (the "Dividend
Agreement") providing for the distribution of the Shares to the stockholders of
the Company within six months following the Closing Date.
1.3. CLOSING. The Closing of the transactions contemplated by this
Agreement shall take place on March 16, 1998 or such other date as mutually
agreed by the Parties. The date on which the Closing actually occurs is
hereinafter referred to as the "Closing Date."
1.4. DELIVERY BY STOCKHOLDER. At the Closing, Stockholder will
deliver to Company the following:
(a) Certificates representing the Shares, in proper form for transfer in
accordance with Section 1.1 hereof;
(b) Evidence of payment of the securities transfer tax due in respect of
the Shares; and
(c) All other previously undelivered documents, instruments and writings
required to be delivered by Stockholder to Company pursuant to this
Agreement or otherwise required in connection herewith.
1.5. DELIVERY BY COMPANY. At the Closing, Company will deliver to
Stockholder (i) cash in amount of $1.00 and (ii) the Dividend Agreement, in form
and on terms satisfactory to the Stockholder.
II. REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS
Stockholder hereby represents and warrants to Company as follows:
2.1. OWNERSHIP OF SHARES. Stockholder owns and has the complete and
unrestricted power and the unqualified right to assign, transfer and deliver to
Company at the Closing, and Company is acquiring at the Closing, good, valid and
marketable title to the Shares, free and clear of all liabilities, obligations,
claims, liens, options, charges, encumbrances and restrictions of any kind
whatsoever, except for those restrictions set forth in this Agreement or in the
Dividend Agreement. There are no outstanding options,
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warrants, or rights to purchase or acquire any of the Shares or any other
securities of the Entity.
2.2. CAPITALIZATION OF THE ENTITY. As of the date of this Agreement,
the authorized capital stock of the Entity consists of 1,000 shares of common
stock, par value $0.01 per share, of which ________ shares are issued and
outstanding, there are no other outstanding securities which represent an
equity interest in the Entity. All of the Shares are owned by Stockholder free
and clear of all liabilities, obligations, claims, liens, options, charges,
encumbrances, and restrictions of any kind whatsoever.
2.3. CONSENTS AND APPROVALS. Except as otherwise contemplated by
this Agreement, no consent, approval, license, permit or authorization of, or
declaration, filing or registration with, any third party or any public body or
authority is required in connection with (a) Stockholder's execution and
delivery of this Agreement, or (b) the consummation of the transactions
contemplated hereby by Stockholder.
III. REPRESENTATIONS AND WARRANTIES OF COMPANY
Company hereby represents and warrants to Stockholder as follows:
3.1. AUTHORIZATION. Company has the full corporate power and
authority to enter into, execute and consummate the transactions contemplated by
this Agreement. Company has taken all action required by law and its
Certificate of Incorporation and By-Laws or otherwise to authorize the execution
and delivery of this Agreement and the transactions contemplated hereby.
3.2. CONSENTS AND APPROVALS. Except as otherwise contemplated by
this Agreement, no consent, approval, license, permit or authorization of, or
declaration, filing or registration with, any third party or any public body or
authority is required in connection with (a) Company's execution and delivery of
this Agreement, or (b) the consummation of the transactions contemplated hereby
by Company.
IV. OTHER OBLIGATIONS OF THE PARTIES
4.1. RESTRICTIONS PENDING THE CLOSING. Without the prior written
consent of Company, Stockholder agrees that from the date hereof until the
Closing, Stockholder will not directly or indirectly enter into any agreement,
offer of enter into any agreement, or encourage or participate with any third
party in any agreement concerning the acquisitions of the Shares of any similar
arrangements or transactions.
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4.2. OTHER TRANSACTIONS. Stockholder shall not directly or
indirectly, encourage, initiate or engage in discussions or negotiations with,
or provide any information to, any corporation, partnership, person, or other
entity or group, other than Company, concerning any merger, sale of securities,
sale, lease or transfer of substantial assets or any other similar transactions
involving the Entity or the Shares.
4.3. BEST EFFORTS. The Parties will use their respective beat
efforts to satisfy all conditions precedent to the obligations of such other
Party, including, without limitation, obtaining prior to the Closing all
consents necessary, in the opinion of counsel for Company, to the consummation
of the transactions contemplated hereby. All such consents will be in writing
and in form and substance satisfactory to Company and executed counterparts
thereof will be delivered to Company promptly after receipt thereof by
Stockholder or the Entity but in no event later than the Closing.
4.4. DIVIDEND AGREEMENT. Prior to the Closing, the Stockholder
and the Company shall enter into the Dividend Agreement which shall provide,
among other things, that following Closing the Company (i) will use its best
efforts to contribute or cause to be contributed assets to the Entity which
would make the Entity a viable stand-alone entity which would meet the
eligibility requirements for listing on the New York Stock Exchange or the
NASDAQ National Market, (ii) following completion of the events in clause (i)
above, will cause the Entity to be listed on the New York Stock Exchange or
the NASDAQ National Market and will distribute the Shares and all other
equity securities in the Entity to the stockholders of the Company. If the
Company is unable to cause the Entity to be listed on the New York Stock
Exchange of the NASDAQ National Market within six months following Closing,
the Company shall, upon the six month anniversary of this Agreement, cause
payment to be made to the Stockholder in an amount necessary to reasonably
compensate the Stockholder for the value of the Shares on the date hereof.
V. CONDITIONS TO OBLIGATIONS OF COMPANY
The obligations of Company under this Agreement are subject to the
satisfaction at the Closing of each of the following conditions:
5.1. REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Stockholder contained herein and in any schedule, instrument,
list, certificate or writing delivered by Stockholder pursuant to this Agreement
shall be true, complete and accurate in all material respects as of the date
when made and at and as of the Closing Date as though such representations and
warranties were made at and as such date, except for any changes, contemplated
by the terms of this Agreement.
5.2. PERFORMANCE. Stockholder shall have performed and
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complied in all material respects with agreements, obligations and conditions
required by this Agreement to be so performed or complied with by it at or prior
to the Closing as set forth in Section 1.4 hereof.
5.3. NO INJUNCTION. On the Closing Date there shall be no effective
injunction, writ, preliminary restraining order or any order of any nature
issued by a court of competent jurisdiction imposing any conditions on the
commsummation of the transactions contemplated hereby which Company deems
unacceptable.
5.4. DOCUMENTS. All documents to be delivered by Stockholder to
Company at the Closing shall be in the form and substance reasonably
satisfactory to Company.
5.5. CONSENTS AND APPROVALS. All licenses, permits, consents,
approvals and authorizations of all third parties and governmental bodies and
agencies shall have been obtained which, in the judgment of Company, are
necessary in connection with the consummation of the purchase of the Shares.
VI. CONDITIONS TO OBLIGATIONS OF STOCKHOLDER
The obligations of Stockholder under this Agreement are subject to
the satisfaction at the Closing of each of the following conditions:
6.1. REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Company contained herein shall be true, complete and accurate as
of the date when made at and as of the Closing Date as though such
representations and warranties wore made at and as of such date, except for any
changes contemplated by the terms of this Agreement.
6.2. PERFORMANCE. Company shall have performed and complied with all
agreements, obligations and conditions required by this Agreement to be so
performed or complied with by it at or prior to the Closing.
VII. TERMINATION OF AGREEMENT
7.1 TERMINATION OF AGREEMENT. This Agreement may be terminated at
any time prior to the Closing:
(a) by mutual written agreement of Stockholder, the Company and the vote
of a majority of the outside directors of the Company; or
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(b) by Company, if the Closing Date has not occurred by September 30,
1998.
7.2. PROCEDURE UPON TERMINATION. In the event of termination by
Stockholder or by Company, written notice thereof shall forthwith be given to
the other Party and the transactions contemplated by this Agreement shall be
terminated, without further action by either Party. If the transactions
contemplated by this Agreement are terminated as provided herein:
(a) all confidential information received by Stockholder on the one hand
or Company on the other with respect to the business of the other Party
shall be returned; and
(b) such terminations shall not in any way limit or restrict the rights
and remedies of Stockholder on the one hand or Company on the other
against the other Party hereto which has violated or breached any of the
representations, warranties, agreements or other provisions of this
Agreement prior to termination hereof.
VII. MISCELLANEOUS
8.1. COMMISSIONS. Each of the Parties hereto represents and warrants
that, except as previously disclosed to the other in writing, no broker or
finder is entitled to any brokerage or finder's fee or other commission in
connection with transactions contemplated hereby. Each of the Parties hereto
will pay or discharge, and will indemnify and hold the other harmless from and
against any and all claims or liabilities for brokerage commissions or finder's
fees incurred by reason of any action taken by it.
8.2. EXPENSES; TAXES, ETC. Except as otherwise provided herein, each
Party hereto will pay all fees and expenses incurred by it in connection with
this Agreement; PROVIDED, HOWEVER, that all securities transfer taxes and other
fees will be paid by Company. All other taxes, including without limitation,
all sales and use taxes incurred in connection with this Agreement and the
transactions contemplated hereby will be borne solely by Company.
8.3. FURTHER ASSURANCES. From time to time, at Company's request and
without further consideration, Stockholder will execute and deliver to Company
such documents and take such other action as Company may reasonably request in
order to consummate more effectively the transactions contemplated hereby and to
vest in Company good, valid and marketable title to the Shares.
8.4. PART IN INTEREST; ASSIGNABILITY. This Agreement will be binding
upon,
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inure to the benefit of, and be enforceable by, the respective successors and
assigns of the Parties hereto; PROVIDED, HOWEVER, that the Parties may not
assign their respective rights and obligations hereunder without the prior
written consent thereto of the other Party; notwithstanding the foregoing,
Company may freely assign its rights and obligations hereunder to one or more of
its affiliates.
8.5. ENTIRE AGREEMENT; AMENDMENTS. This Agreement, the exhibits,
the schedules and other writings referred to herein or delivered pursuant
hereto which form a part hereof, contain the entire understanding of the
Parties with respect to its subject matter. This Agreement supersedes all
prior agreements and understandings between the Parties with respect to this
subject matter. This Agreement may be amended only by a written instrument
duly executed by the Parties and by a representative signing on behalf of a
majority of the outside directors of the Company. Any condition to a Party's
obligations hereunder may be waived in writing by such Party.
8.6. GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO ITS CHOICE OF LAW RULES.
8.7. THIRD PARTIES. Except as specifically set forth or referred to
herein, nothing herein expressed or implied is intended or shall be construed to
confer upon or give to any person other than the Parties hereto and their
successors or assigns, any rights or remedies under or by reason of this
Agreement.
* * * * *
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IN WITNESS WHEREOF, this Agreement has been duly executed, duly
authorized and delivered by Stockholder and Company on the date first above
written.
COMMERCIAL ASSETS, INC.
By:
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Name: Xxxxx Xxxxxxxxx
Its: Co-Chief Executive Officer
XXXXX XXXXXXXXX
Signed:
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