ANNULMENT AND AMENDING AGREEMENT
THIS ANNULMENT AND AMENDING AGREEMENT (the "Amending Agreement")
is made and entered into as of the 31st day of December, 2003, by
and between the following:
XXXXXX X. XXXXXX, an individual, and XXXXXXXX X. XXXXXX, an
individual, (collectively, the "Sellers"; and
PARAMCO FINANCIAL GROUP, INC., a Delaware corporation
("Paramco").
WITNESSETH
WHEREAS, the parties hereto entered into that certain Purchase
Agreement, dated as of September 19, 2003 (the "Purchase
Agreement"), subject to the terms and conditions of which Paramco
and Sellers desired for Paramco to purchase from Sellers and for
Sellers to sell to Paramco all of the outstanding common stock of
ROYAL FEDERAL, INC., a Louisiana corporation;
WHEREAS, in Section 4.4(b) of the Purchase Agreement, Sellers
represented and warranted to Paramco that:
Royal Federal's Financial Statements are capable of being
examined and reported upon with an unqualified opinion
expressed by an independent public or certified public
accountant and will comply with the requirements and
standards set forth in Regulation S-X, as promulgated and
adopted by the Securities and Exchange Commission.
WHEREAS, in reliance on such representation and warranty, the
parties closed the transactions contemplated by the Purchase
Agreement on September 19, 2003 (the "September Closing");
WHEREAS, as of the date hereof an audit of such financial
statements (the "Financial Statements") has not been completed by
Paramco's independent accountant, who has stated that such audit
will not be completed until after the first quarter of 2004;
WHEREAS, Paramco and Sellers deem it desirable and in the best
interests of Paramco that the September Closing be annulled and
that the Purchase Agreement be amended to provide for a closing
date not later than September 30, 2004, subject to completion of
the audit of the Financial Statements; and
WHEREAS, Sellers and the Board of Directors of Paramco have
approved and adopted this Amending Agreement, subject to the
terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the parties hereto do
hereby agree as follows:
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SECTION 1
DEFINITIONS
1.1 "Amending Agreement", "Sellers", "Paramco", "Purchase
Agreement", "Financial Statements", and "September Closing",
respectively, shall have the meanings defined in the foregoing
preamble and recitals to this Amending Agreement.
1.2 All defined terms not otherwise defined herein shall have
the meanings ascribed to them in the Purchase Agreement.
SECTION 2
AGREEMENT FOR ANNULMENT OF CLOSING AND AMENDMENT OF CLOSING DATE
2.1 Annulment of Closing.
Effective as of the date of this Amending Agreement, the August
Closing is hereby annulled and, in accordance therewith, (a)
Sellers hereby tender to Paramco certificates representing
100,000 shares of Paramco's Common Stock, bearing the restrictive
legend 144 in a form enabling Paramco, then and there, to cancel
said shares, and (b) Paramco hereby tenders to Sellers Royal
Federal certificate, representing all of the issued and
outstanding capital stock (100,000 shares of common stock) of
Royal, in a form enabling Sellers, then and there, to become the
record and beneficial owners of said common stock.
2.2 Amendment of Closing Date.
The date referenced in the definition of "Closing Date" in the
Purchase Agreement is hereby changed, such that the definition of
"Closing Date" shall be amended in full to read as follows:
"Closing Date" shall mean 10:00 a.m., local time, September
30, 2004, at Denver, Colorado, the date on which the parties
hereto shall close the transaction contemplated herein;
provided that the parties can change the Closing Date and
place of Closing to such other time and place as the parties
shall mutually agree, in writing. As of the Closing Date,
all Exhibits to this Agreement shall be complete and
attached to this Agreement.
2.3 Addition of Section 8.3.
The following Section 8.3 shall be added to the Purchase
Agreement:
8.3 Audit of Financial Statements. The audit of the
Financial Statements by Paramco's independent accountant
shall be complete and delivered to Paramco no later than the
Closing Date.
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SECTION 3
REPRESENTATIONS AND WARRANTIES OF PARAMCO
Paramco, in order to induce Sellers to execute this Amending
Agreement and to consummate the transaction contemplated herein,
represents and warrants to Sellers, as follows:
3.1 Authorization and Validity. Paramco has the requisite power
and is duly authorized to execute and deliver and to carry out
the terms of this Amending Agreement. The board of directors and
stockholders of Paramco have taken all action required by law,
its Articles of Incorporation and Bylaws, both as amended, or
otherwise to authorize the execution and delivery of this
Amending Agreement and the consummation of the transactions
contemplated hereby. Assuming this Amending Agreement has been
approved by all action necessary on the part of Sellers, this
Amending Agreement is a valid and binding agreement of Paramco.
3.2 No Defaults. Neither the execution and delivery of this
Amending Agreement, nor the consummation of the transactions
contemplated herein, will conflict with or result in a breach of
or constitute a default under any of the foregoing or result in
the creation of any lien, mortgage, pledge, charge, or
encumbrance upon any asset of Paramco and no consents or waivers
thereunder are required to be obtained in connection therewith in
order to consummate the transactions contemplated by this
Amending Agreement.
SECTION 4
REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers, in order to induce Paramco to execute this Amending
Agreement and to consummate the transaction contemplated herein,
represent and warrant to Paramco as follows:
4.1 Authorization and Validity. Sellers have the requisite power
and are duly authorized to execute and deliver and to carry out
the terms of this Amending Agreement. Assuming this Amending
Agreement has been approved by all action necessary on the part
of Paramco, this Amending Agreement is a valid and binding
agreement of Sellers.
4.2 Status of Alliance Capital Group. From and after the
September Closing through and including the date hereof Sellers
have been fully responsible for the management, directions,
operations, and planning in respect of Royal Federal, and Sellers
acknowledge that Paramco has not made any representation or
warranty as to the status of Alliance as of the date hereof or
any change to such status during the period from and after the
September Closing through and including the date hereof.
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4.3 No Defaults. Neither the execution and delivery of this
Amending Agreement, nor the consummation of the transactions
contemplated herein, will conflict with or result in a breach of
or constitute a default under any of the foregoing or result in
the creation of any lien, mortgage, pledge, charge, or
encumbrance upon any asset of Alliance and no consents or waivers
thereunder are required to be obtained in connection therewith in
order to consummate the transaction contemplated by this Amending
Agreement.
SECTION 5
PRESS RELEASE
5.1 Press Release. Sellers acknowledge that Paramco may issue
its press release in respect of the transactions contemplated by
this Amending Agreement, and shall promptly file a Current Report
on Form 8-K in respect thereof, copies of each which documents
shall be provided to Sellers within two business days of their
issuance and filing, respectively.
SECTION 6
NATURE AND SURVIVAL OF REPRESENTATIONS, ETC.
6.1 All statements contained in any certificate or other
instrument delivered by or on behalf of Paramco or Sellers
pursuant to this Amending Agreement or in connection with the
transactions contemplated hereby shall be deemed representations
and warranties by such party. All representations and warranties
and agreements made by Paramco or Sellers in this Amending
Agreement or pursuant hereto shall survive the date hereof until
the Closing Date of September 30, 2004.
SECTION 7
MISCELLANEOUS
7.1 Notices. Any notices or other communications required or
permitted hereunder shall be sufficiently given if written and
delivered in person or sent by registered mail, postage prepaid,
addressed as follows:
To Sellers: Xxxxxx X. Xxxxxx
Royal Federal, Inc.
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
and
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Xxxxxxxx X. Xxxxxx
Royal Federal, Inc.
000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
To Paramco: Paramco Financial Group, Inc.
Attn: Xxxxxxx X. Xxxxx
0000 Xx. Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Copy to: Xxxxx Xxxx LLP
(which shall not Attn: Xxxxxxx X. Xxxx, Esq.
constitute notice) 0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
or such other addresses as shall be furnished in writing by the
appropriate person, and any such notice or communication shall be
deemed to have been given as of the date so mailed.
7.2 Time of the Essence. Time shall be of the essence of this
Amending Agreement.
7.3 Costs. Each party will bear the costs and expenses incurred
by it in connection with this Amending Agreement and the
transactions contemplated hereby.
7.4 Entire Agreement. This Amending Agreement and the documents
delivered concurrently herewith contain the entire agreement
between the parties hereto with respect to the transactions
contemplated this Amending Agreement and supersede all other
agreements, written or oral, with respect thereto. This Amending
Agreement may be amended or modified in whole or in part, and any
rights hereunder may be waived, only by an agreement in writing,
duly and validly executed in the same manner as this Amending
Agreement or by the party against whom the waiver would be
asserted. The waiver of any right hereunder shall be effective
only with respect to the matter specifically waived and shall not
act as a continuing waiver unless it so states by its terms.
7.5 Counterparts. This Amending Agreement may be executed in one
or more counterparts each of which shall be deemed to constitute
an original and shall become effective when one or more
counterparts have been signed by each party hereto and delivered
to the other party.
7.6 Governing Law. This Amending Agreement shall be governed by,
and construed and interpreted in accordance with, the laws of the
State of Colorado.
7.7 Attorneys' Fees and Costs. In the event any party to this
Amending Agreement shall be required to initiate legal
proceedings to enforce performance of any term or condition of
this Amending Agreement, including, but not limited to, the
interpretation of any term or provision hereof the payment of
moneys or the enjoining of any action prohibited hereunder, the
prevailing party shall be entitled to recover such sums, in
addition to any other damages or compensation received, as will
reimburse the prevailing party for reasonable attorneys' fees and
court costs incurred on account thereof (including, without
limitation, the costs of any appeal) notwithstanding the nature
of the claim or cause of action asserted by the prevailing party.
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7.8 Successors and Assigns. This Amending Agreement shall inure
to the benefit of and be binding upon the parties hereto and
their respective heirs, executors, personal representatives,
successors, and assigns, as the case may be.
7.9 Access to Counsel. Each party hereto acknowledges that each
has had access to legal counsel of her or its own choice and has
obtained such advice therefrom, if any, as such party has deemed
necessary and sufficient prior to the execution hereof Each party
hereto acknowledges that the drafting of this Amending Agreement
has been a joint effort and any ambiguities or interpretative
issues that may arise from and after the execution hereof shall
not be decided in favor or, or against, any party hereto because
the language reflecting any such ambiguities or issues may have
been drafted by any specific party or his or its counsel.
7.10 Captions. The captions appearing in this Amending
Agreement are inserted for convenience of reference only and
shall not affect the interpretation of this Amending Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
PARAMCO FINANCIAL GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------
Xxxxxxx X. Xxxxx
Chairman and Chief Executive Officer
SELLERS
By: /s/ Xxxxxx X. Xxxxxx
--------------------
Xxxxxx X. Xxxxxx
By: /s/ Xxxxxxxx X. Xxxxxx
-----------------------
Xxxxxxxx X. Xxxxxx
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