SHARE EXCHANGE AGREEMENT
THIS SHARE EXCHANGE AGREEMENT (this "Agreement') is entered into
effective as of the 17th day of February, 2000, by and among EMPIRE FINANCIAL
HOLDING COMPANY, a Florida corporation, with a principal address of 0000 Xxxx
Xxxxx Xxxx 000, Xxxxxxxx, Xxxxxxx 00000 (the "Company"), XXXXX X. XXXXX
("Xxxxx") and XXXXXXX X. XXXXX ("Xxxxx"), each an individual with an address c/o
of the Company (Xxxxx and Xxxxx are referred to individually as "Shareholder"
and collectively as "Shareholders").
Recitals:
A. Empire Financial Group, Inc., a Florida corporation
("Empire-Florida"), is authorized to issue 1,000 voting shares of common stock,
$10 par value per share, and 200,000 non-voting shares of common stock, $.001
par value per share. Empire-Florida has issued 100,500 shares to Xxxxx and
100,500 shares to Xxxxx, which collectively represents all of the issued and
outstanding shares of Empire-Florida (collectively, the "Empire-Florida
Shares").
B. Advantage Trading Group, Inc., a Florida corporation
("Advantage-Florida"), is authorized to issue 1,000 shares of common stock, $10
par value per share. Advantage-Florida has issued 500 shares to Xxxxx and 500
shares to Xxxxx, which collectively represent all of the issued and outstanding
shares of Advantage-Florida (collectively, the "Advantage-Florida Shares").
C. Empire Investment Advisors, Inc., a Florida corporation ("Investment
Advisors"), is authorized to issue 1,000 shares of common stock, $.01 par value
per share. Investment Advisors has issued 500 shares to Xxxxx and 500 shares to
Xxxxx, which collectively represent all of the issued and outstanding shares of
Investment Advisors (collectively, the "Investment Advisors Shares").
D. The Company is authorized to issue 100,000,000 shares of common
stock, $.01 par value per share ("Common Stock"), none of which are presently
issued and outstanding.
E. Each of the Shareholders desires to contribute all of his
Empire-Florida Shares, Advantage-Florida Shares and Investment Advisors Shares
to the Company in exchange for shares of Common Stock, in accordance with the
terms of this Agreement, in a tax-free transaction within the meaning of Section
351 of the Internal Revenue Code of 1986, as amended ("Section 351").
NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Exchange of Stock.
a. The Shareholders agree to contribute to the Company
pursuant to Section 351, and the Company agrees to accept from the
Shareholders, all of the Empire-Florida Shares.
b. The Shareholders agree to contribute to the Company
pursuant to Section 351, and the Company agrees to accept from the
Shareholders, all of the Advantage-Florida Shares.
c. The Shareholders agree to contribute to the Company
pursuant to Section 351, and the Company agrees to accept from the
Shareholders, all of the Investment Advisors Shares.
d. In exchange for the Empire-Florida Shares,
Advantage-Florida Shares and Investment Advisors Shares, the Company
agrees to issue and deliver to each of the Shareholders 4,000,000
shares of Common Stock, which will result in the Shareholders owning
100% of the issued and outstanding shares of capital stock of the
Company after said exchange. The Company acknowledges that the exchange
of the Empire-Florida Shares, Advantage-Florida Shares and Investment
Advisors Shares for shares of Common Stock is a tax free exchange
pursuant to Section 351.
2. Closing.
a. The Closing of the transactions contemplated hereby shall
take place in the offices of Xxxxxxxxx Traurig, P.A., 0000 Xxxxxxxx
Xxxxxx, Xxxxx, Xxxxxxx 00000 on February 17, 2000 or any other date
designated in writing by the Company. At the Closing:
i. The Shareholders shall deliver to the
Company the following:
(A) Stock certificates evidencing their
Empire-Florida Shares in proper form of transfer,
duly endorsed in blank or accompanied by an executed
stock power, with evidence of payment of any required
transfer taxes or documentary tax stamps; and
(B) All minute books, stock records and
other corporate records of Empire-Florida.
(C) Stock certificates evidencing their
Advantage-Florida Shares in proper form of transfer,
duly endorsed in blank or accompanied by an executed
stock power, with evidence of payment of any required
transfer taxes or documentary tax stamps; and
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(D) All minute books, stock records and
other corporate records of Advantage-Florida.
(E) Stock certificates evidencing their
Investment Advisors Shares in proper form of
transfer, duly endorsed in blank or accompanied by an
executed stock power, with evidence of payment of any
required transfer taxes or documentary tax stamps;
and
(F) All minute books, stock records and
other corporate records of Investment Advisors.
ii. The Company shall deliver to each Shareholder a
certificate or certificates evidencing 4,000,000
shares of Common Stock.
3. Representations and Warranties of Shareholders.
Each of the Shareholders jointly and severally represents and
warrants to the Company as of the date and time of the Closing, that:
a. Each Shareholder is the owner, beneficially and of record,
of those Empire-Florida Shares, Advantage-Florida Shares and Investment
Advisors Shares being exchanged hereby free and clear of any claims,
liens, options, charges, security interests, or encumbrances of any
nature (collectively, "Liens").
b. Upon delivery of all of the Empire-Florida Shares,
Advantage-Florida Shares and Investment Advisors Shares, the Company
shall acquire good and marketable title to such shares, free and clear
of all Liens, and shall be the holder of 100% of the issued and
outstanding capital stock of Empire-Florida, Advantage-Florida and
Investment Advisors.
c. There are no options, warrants or rights to acquire any of
the shares or any interest in Empire-Florida, Advantage-Florida or
Investment Advisors, and no claim by any person to any such rights.
d. Each Shareholder has full power and authority to contribute
his portion of Empire-Florida Shares, Advantage-Florida Shares or
Investment Advisors Shares to the Company and to consummate the
transactions contemplated by this Agreement. This Agreement and any
other documents or agreements related to this Agreement and executed by
either Shareholder constitute the valid and binding obligations of each
Shareholder, enforceable against the Shareholder in accordance with
their respective terms. Neither the execution and delivery of this
Agreement or the execution of any other documents or Agreements related
to this Agreement, nor the consummation of the transactions
contemplated by this Agreement violates any agreement to which such
Shareholder is a party or by which the Shareholder is bound, or
violates any law, order, decree or judgment applicable to such
Shareholder. No authorization, approval or
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consent of any third-party is required for lawful execution, delivery
and performance of this Agreement by each Shareholder.
e. Each Shareholder acknowledges that he is fully familiar
with the business, finances and operations of the Company. Each
Shareholder further acknowledges that the shares of the Common Stock
being issued to each Shareholder pursuant to this Agreement are being
issued without registration under the Securities Act of 1933, as
amended (the "Act"). The shares of the Common Stock may only be resold
if registered under the Act or pursuant to an exemption from the
registration provisions. Each Shareholder represents and warrants that
he is acquiring the shares of Common Stock for his own account for
investment and that the shares are not being required for resale in
connection with any distribution within the meaning of the Act. Each
Shareholder acknowledges that the certificates representing the shares
of Common Stock will bear a restrictive legend substantially as
follows:
"These shares have not been registered under the
Securities Act of 1933, as amended (the "Act"), and may not be
offered, sold, assigned, pledged, hypothecated or disposed of
except (i) pursuant to an effective registration statement
under the Act or (ii) upon the delivery by the holder of the
shares to the Company of an opinion of counsel, satisfactory
to the counsel for the Company, stating that an exemption from
registration under the Act is available."
4. Miscellaneous.
a. Survival. All representations, covenants, warranties and
agreements contained in this Agreement shall survive the Closing.
b. Waiver. Neither the failure nor any delay of any party to
exercise any right, remedy, power or privilege under this Agreement
shall operate as a waiver; nor shall any single or partial exercise of
any right, preclude further exercise of the same or of any other right;
nor shall any waiver of any right with regard to a specific occurrence
be construed as a waiver of that right with respect to any other
occurrence. No waiver shall be effective unless it is in writing and is
signed by the party granting the waiver.
c. Controlling Law. This Agreement and all questions relating
to its validity, interpretation, performance and enforcement (including
provisions concerning limitations of actions), shall be governed by the
laws of the State of Florida, and without the aid of any canon, custom
or rule of law requiring construction against the draftsman.
d. Notices. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in
writing and shall be deemed to have been received only when personally
delivered. Personal delivery is effectuated either two days following
the day when deposited with an overnight courier service, such as
Federal Express, for delivery to the intended addressee or two days
following the day
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when deposited in the United States mails, first class postage prepaid,
to the addresses set forth at the beginning of the Agreement. Any
person may alter the address to which communications or copies are to
be sent by giving notice of such change of address in conformity with
the provisions of this paragraph for the giving of notice.
e. Binding Nature of Agreement; No Assignment. This Agreement
shall be binding upon and inure to the benefit of the parties to the
Agreement, their respective heirs, personal representatives, successors
and assigns, except that no party may assign or transfer its rights
under this Agreement without the prior written consent of all parties.
f. Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an
original as against any party who signs the counterpart. All
counterparts together shall constitute one instrument. This Agreement
shall become binding when one or more counterparts, individually or
together, bears the signatures of all of the parties reflected as the
signatories.
g. Provisions Severable. The provisions of this Agreement are
independent of and severable from each other, and no provision shall be
affected or rendered invalid or unenforceable by virtue of the fact
that any other provision or provisions may be invalid or unenforceable
in whole or in part.
h. Paragraph Headings. The section headings in this Agreement
are for convenience only; they form no part of this Agreement and shall
not affect its interpretation.
i. Gender, Etc. Words used in this Agreement, regardless of
the number and gender specifically used, shall be construed to include
any other number, singular or plural, and any other gender, masculine,
feminine or neuter, as the context indicates is appropriate.
IN WITNESS HEREOF, the parties have executed and delivered this
Agreement on the date written above.
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SHAREHOLDERS:
/s/ Xxxxx X. Xxxxx
------------------
XXXXX X. XXXXX
/s/ Xxxxxxx X. Xxxxx
--------------------
XXXXXXX X. XXXXX
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COMPANY:
EMPIRE FINANCIAL HOLDING COMPANY
By: /s/ Xxxxx X. Xxxxx
----------------------
XXXXX X. XXXXX
Co-Chief Executive Officer
By: /s/ Xxxxxxx X. Xxxxx
------------------------
XXXXXXX X. XXXXX
Co-Chief Executive Officer
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