EXCHANGE AGREEMENT
This Agreement is dated March 8, 2000, between North Lilly Mining Company,
a Utah corporation ("NLMC") and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, collectively the shareholders
(the "Shareholders") of Home ▇▇▇▇.▇▇▇, Inc., a Colorado corporation ("Loan").
Whenever both parties are collectively referred to in this Agreement, they shall
be designated as the "parties".
The parties wish to provide for the Shareholders's exchange of all of the
issued and outstanding shares of Loan which consist of 1,006 shares in exchange
for shares of NLMC according to the terms and conditions of this Agreement.
The parties agree as follows:
1. The Acquisition.
1.1 Purchase and Sale. Subject to the terms and conditions of this
Agreement, at the Closing to be held as provided in Section 1.3,
NLMC shall acquire all of the issued and outstanding shares of
Loan and as of the Closing, Loan shall own the Assets listed in
Exhibit A ("Assets") free and clear of all encumbrances except as
disclosed on Exhibit B ("Encumbrances").
1.2 Purchase Price. Shareholders will exchange their 1,006 shares in
Loan for 5,633,600 shares of common stock of NLMC ("Shares")
which shall be taken as restricted investment stock pursuant to
investment representations and restrictive legends under the
federal securities laws. Each share of Loan shall be exchanged
for 5,600 Shares of NLMC.
NLMC shall hold in escrow one million (1,000,000) of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇'▇ portion of the Shares which shall be deemed nonvoting
Shares until released. These shall be released not later than
September 30, 2000, provided that (a) NLMC has received at least
$250,000 in financing since signing this agreement at not less
than $0.40 per share, and (b) Loan's business has produced sales
for the two months ended August 31, 2000 averaging at least
$200,000 per month, with no less than break-even operating cash
flow after deduction of operating expenses (including all general
and administrative overhead expenses, but excluding outside costs
of advertising, expansion, acquisitions and web-site
development). It is understood that the parties will seek to
finance such outside costs of advertising, expansion,
acquisitions and web-site development primarily out of additional
equity funding. NLMC shall exert good faith best efforts to
achieve the above results with Loan, but shall cancel the one
million (1,000,000) Shares if said results are not achieved.
1.3 The Closing; Place and Time. The closing of the sale and purchase
of the Shares (the "Closing") shall take place at the offices of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq., Denver, Colorado, no later than the
close of business on March 10, 2000, or at such other place, date
and time as the parties may agree in writing.
1.4 Deliveries by Shareholders. At the Closing, the Shareholders
shall deliver the following to NLMC:
(a) The 1,006 common shares to be transferred hereunder, along
with any instruments required to be executed by the
Shareholders, so that the shares can be cancelled by NLMC.
(b) All other documents, instruments and writings required by
this Agreement to be delivered by Shareholders at the
Closing and any other documents or records relating to
Loan's business reasonably requested by NLMC in connection
with this Agreement.
1.5 Deliveries by NLMC. At the Closing, NLMC shall deliver the
following to Shareholders:
(a) The Shares as contemplated by Section 1.2 shall be issued
among the Shareholders as set forth in Exhibit C (or
irrevocable instructions shall be provided to NLMC's
transfer agent to issue said Shares).
(b) All other documents, instruments and writings required by
this Agreement to be delivered by NLMC at the Closing.
2. Conditions to NLMC's Obligations.
The obligations of NLMC to effect the Closing shall be subject to the
satisfaction at or prior to the Closing of the following conditions, any one or
more of which may be waived by NLMC:
2.1 Representations, Warranties and Agreements.
(a) The representations and warranties of Shareholders set forth
in this Agreement shall be true and complete in all material
respects as of the Closing Date as though made at such time.
(b) Shareholders shall have performed and complied in all
material respects with the covenants contained in this
Agreement required to be performed and complied with by it
at or prior to the Closing.
(c) Shareholders shall have put in place an improved team of
mortgage brokers, telemarketing, processing and closing
staff capable of at least equaling the production in the
financials statements within thirty (30) days, and then
growing same in the offices and on the internet.
(d) Shareholders shall deliver the contemplated stock redemption
agreements, releases and waivers satisfactory to NLMC and
duly executed by ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ and
▇▇▇▇▇ ▇▇▇▇▇▇.
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(e) Shareholders shall also deliver satisfactory releases from
its investors, and also from the investors affiliated with
Messrs. Bonn and ▇▇▇▇▇▇, in exchange for which NLMC shall
issue up to 26,000 additional shares of its stock to the
investors of Messrs. Bonn and ▇▇▇▇▇▇.
3. Conditions to Shareholders' Obligations.
The obligations of Shareholders to effect the Closing shall be subject to
the satisfaction at or prior to the Closing of the following conditions, any one
or more of which may be waived by Shareholders:
3.1 Representations, Warranties and Agreements.
(a) The representations and warranties of NLMC set forth in this
Agreement shall be true and complete in all material
respects as of the Closing Date as though made at such time.
(b) NLMC shall have performed and complied in all material
respects with the covenants contained in this Agreement
required to be performed and complied with by it prior to or
at the Closing.
4. Representations and Warranties of Shareholders.
Shareholders represent and warrant to NLMC as follows:
4.1 Organization of Loan; Authorization. Loan is a corporation duly
organized, validly existing and in good standing under the laws
of Colorado with full corporate power and authority to execute
and deliver this Agreement as it pertains to any representations
or undertakings of Loan. The execution, delivery and performance
of this Agreement has been duly authorized by all of the
Shareholders and constitutes a valid and binding obligation of
Shareholders, enforceable against each of them in accordance with
its terms.
4.2 Conflict as to Loan. Neither the execution and delivery of this
Agreement nor the performance of NLMC's obligations hereunder
will (a) violate any provision of any agreement or the
certificate of incorporation or by-laws of Loan or (b) violate
any statute or law or any judgement, decree, order, regulation or
rule of any court or other Governmental Body applicable to Loan.
4.3 Ownership of Assets. The delivery of certificates to Shareholders
in exchange for Shares in NLMC will result in NLMC's immediate
acquisition of 100% of Loan which has record and beneficial
ownership of the Assets, free and clear of all encumbrances
except as listed on Exhibit B. Loan's leases listed on Exhibit E
are in full force and effect and in good standing.
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Loan has the rights to the names Home ▇▇▇▇.▇▇▇, Inc. and Loan
▇▇▇▇▇▇.▇▇▇. Loan also owns the non-exclusive benefit of the Loan
▇▇▇▇▇▇.▇▇▇ web site development, the business plan for home
improvement financing, and the business model/implementation plan
for Loan ▇▇▇▇▇▇.▇▇▇.
4.4 Financial Statements and Ledgers. Shareholders have delivered to
NLMC consolidated balance sheets and income statements of
Shareholders through September 30, 1999 and ledgers thru January
31, 2000, which shall be reviewed in detail with NLMC prior to
Closing which shall be reviewed in detail with NLMC prior to
Closing. Attached as Exhibit G is a consolidated statement of
income and expenses through January 31, 2000. The above
financials fairly and accurately represent Loan's business,
operations and assets as of the date thereof and there has not
been any material adverse changes in the business, operations and
assets since the date thereof.
4.5 Equipment. The material items of equipment and other personal
property owned or leased by Loan or its subsidiaries are in good
operating condition and repair (ordinary wear and tear excepted)
and are adequate in all such respects for the purpose for which
they are being used.
4.6 Litigation. There is no action, suit, inquiry, proceeding or
investigation by or before any court of governmental body pending
or threatened in writing against or involving Loan or any of its
subsidiaries which is likely to have a material adverse effect on
the business or financial condition of Loan and its subsidiaries,
taken as a whole, or which would require a payment by
Shareholders or its subsidiaries in excess of $5,000 in the
aggregate or which questions or challenges the validity of this
Agreement. Neither Loan nor any of its subsidiaries is subject to
any judgment, order or decree that is likely to have a material
adverse effect on the business or financial condition of Loan and
its subsidiaries, taken as a whole, or which would require a
payment by Loan or its subsidiaries in excess of $5,000 in the
aggregate. Exhibit D contains the only action, suit, inquiry,
proceeding or investigation pending or threatened against or in
relation to Loan or any of its subsidiaries.
4.7 Agreements of Loan. Loan has no obligations, employment or
consulting arrangement or other agreements except as reflected on
Exhibit E attached hereto and incorporated herein.
4.8 Absence of Certain Changes. Since the date of the balance sheet,
neither Loan nor any of its subsidiaries has:
(a) Suffered the damage or destruction of any of its properties
or assets (whether or not covered by insurance) which is
materially adverse to the business or financial condition of
Loan and its subsidiaries, taken as a whole, or made any
disposition of any of its material properties or assets
other than in the ordinary course of business.
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(b) Made any change or amendment in its certificate of
incorporation or by-laws or other governing instruments.
(c) Issued or sold any equity securities or other securities
acquired, directly or indirectly, by redemption or
otherwise, any sch equity securities, reclassified, split-up
or otherwise changed any such equity security, or granted or
entered into any options, warrants, calls or commitments of
any kind with respect thereto.
(d) Borrowed any funds or incurred, or assumed or become subject
to, whether directly or by way of guarantee or otherwise,
any obligation or liability with respect to any such
indebtedness for borrowed money.
(e) Other than the ordinary course of business, incurred any
liability required by generally accepted accounting
principles to be reflected on a balance sheet and material
to the business or financial condition of Loan and its
subsidiaries taken as a whole.
(f) Incurred any obligation other than as clearly reflected and
identified between the parties hereto in the financial
statement and ledgers.
4.9 No Material Adverse Change. Since the date of the balance sheet,
there has not been any material adverse change in the business or
financial condition of Loan and its subsidiaries taken as whole,
other than changes resulting from economic conditions prevailing
in the United States.
4.10 Brokers or Finders. Shareholders have not employed any broker or
finder or incurred any liability for any brokerage or finder's
fees or commissions or similar payments in connection with the
exchange of the Shares with NLMC.
4.11 Transactions with Directors and Officers. Loan and its
subsidiaries do not engage in business with any person in which
any of Loan's directors or officers has a material equity
interest. No director or officer of Loan owns any property, asset
or right which is material to the business of Loan and its
subsidiaries, taken as a whole.
4.12 Borrowing and Guarantees. Except for items in the ordinary course
of its business, Loan and its subsidiaries (a) do not have any
indebtedness for borrowed money, (b) are not lending or committed
to lend any money (except for advances to employees in the
ordinary course of business), and (c) are not guarantors or
sureties with respect to the obligations of any person.
4.13 Shareholdings of Loan. Attached as Exhibit C is a list of all
shareholders of Loan and their shareholdings in Loan.
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4.14 Business Team. Shareholders have put in place an improved team of
mortgage brokers, telemarketing, processing and closing staff
capable of at least equaling the production in the financials
statements within thirty (30) days, and then expanding same in
the offices and on the internet.
4.15 Restricted Securities.
(a) (i) each Shareholder can bear the economic risk of losing each
Shareholder's entire investment in the Shares;
(ii) each Shareholder is acquiring the Shares for investment
purposes only and the Shares each Shareholder is acquiring
will be held by each Shareholder without sale, transfer or
other disposition for an indefinite period unless the
transfer of the Shares subsequently is registered under the
U.S. federal securities laws or unless exemptions from
registration are available;
(iii) each Shareholder's overall commitments to investments that
are not readily marketable is not disproportionate to each
Shareholder's net worth and each Shareholder's investment in
the Shares will not cause such overall commitments to become
excessive;
(iv) each Shareholder's financial condition is such that each
Shareholder is under no present or contemplated future need
to dispose of any portion of the Shares to satisfy any
existing or contemplated undertaking, need or indebtedness;
(v) each Shareholder has adequate means of providing for each
Shareholder's current needs and personal contingencies and
has no need for liquidity in each Shareholder's investment
in the Shares; and
(vi) each Shareholder has sufficient knowledge and experience in
business and financial matters to evaluate and has evaluated
the merits and risks of an investment in the Shares.
(b) Each Shareholder confirms that all documents, records and books
pertaining to an investment in the Shares that have been
requested by each Shareholder have been made available or
delivered to each Shareholder. As a result of its review of NLMC,
including the review of the materials provided to each
Shareholder, each Shareholder understands, among other things,
the following: NLMC has limited financial resources, has incurred
negative cash flow, and recently has not operated at a profit;
and NLMC has not concurrently, and may not in the future, receive
additional investment funds.
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Each Shareholder further represents that each Shareholder is
aware of the operations, financial condition and capitalization
of NLMC and has available full information concerning NLMC's
affairs to evaluate the merits and risks of the investment in the
Shares.
(c) Each Shareholder has had the opportunity to ask questions of, and
receive answers from, NLMC concerning the terms of an investment
in the Shares and to receive additional information necessary to
verify the accuracy of the information delivered to each
Shareholders.
(d) Each Shareholder understands that the issuance of the Shares has
not been registered under the U.S. Securities Act of 1933, as
amended (the "Act"), or any state securities laws in reliance on
an exemption for private offerings and no U.S. federal or state
agency has made any finding or determination as to the fairness
of this investment or any recommendation or endorsement of the
offering of the Shares.
(e) The Shares for which each Shareholder hereby subscribes are being
or will be acquired solely for each Shareholder's own account,
for investment, and is not being purchased with a view to or for
the resale, distribution, subdivision or fractionalization
thereof; each Shareholder has no agreement or arrangement for any
such resale, distribution, subdivision or fractionalization
thereof.
(f) Each Shareholder acknowledges that, in making the decision to
purchase the Shares, it has relied solely upon independent
investigations made by it.
(g) Each Shareholder represents that an investment in the Shares is a
suitable investment for each Shareholder.
(h) Each Shareholder acknowledges and is aware that the following
legend will be imprinted on the Shares subscribed to by each
Shareholder:
"THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED
WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"), AND ARE "RESTRICTED
SECURITIES" AS THAT TERM IS DEFINED IN
RULE 144 UNDER THE 1933 ACT. THE
SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT, OR
PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE 1933 ACT."
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(i) Each Shareholder acknowledges and is aware of the following, in
addition to other information included in the information
provided to each Shareholder:
(i) The Shares are a speculative investment and involve a high
degree of risk of loss by each Shareholder of each
Shareholder's total investment.
(ii) There are substantial restrictions on the transferability of
the Securities. The Shares can not be transferred, pledged,
hypothecated, sold or otherwise disposed of unless they are
registered under the Act of an exemption from such
registration is available and established to the
satisfaction of NLMC; except as provided in Section 5.5
below, the Shareholders have no rights to require that any
transfer of the Shares be registered under the Act; there
will be a limited public market for NLMC's Common Stock; and
accordingly, each Shareholder may have to hold the Shares
indefinitely; and it may not be possible for each
Shareholder to liquidate each Shareholder's investment in
NLMC.
5. Representations and Warranties of NLMC:
NLMC represents and warrants to Shareholders as follows:
5.1 Organization of NLMC; Authorization. NLMC is a corporation duly
organized, validly existing and in good standing under the laws
of Utah with full corporate power and authority to execute and
deliver this Agreement as it pertains to any representations or
undertakings of Shareholders. The execution, delivery and
performance of this Agreement has been duly authorized by all
necessary corporate actions of Loan and this Agreement
constitutes a valid and binding obligation of Loan, enforceable
against it in accordance with its terms.
5.2 NLMC Review of Records. NLMC is a sophisticated business entity
and an accredited investor and has been given an opportunity to
review provided corporate records and accountings for Loan and is
acquiring such assets of Loan after satisfaction of its own due
diligence standards.
5.3 Brokers and Finders. NLMC has not employed any broker or finder
or incurred any liability for any brokerage or finder's fees or
commission or similar payments in connection with any of the
transactions contemplated hereby.
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5.4 Conflict as to NLMC. Neither the execution and delivery of this
Agreement nor the performance of NLMC's obligations hereunder
will (a) violate any provision of the certificate of
incorporation or by-laws of NLMC or (b) violate any statute or
law or any judgment, decree, order regulation or rule of any
court or other governmental body applicable to NLMC.
5.5 Registration of Shares. NLMC shall file a Registration Statement
including the 5,633,600 Shares acquired by the Shareholders under
this Agreement (and the additional shares in 2.1 (e) above) as
soon as reasonably feasible within sixty (60) to one hundred
twenty (120) days from the date of Closing. Said Registration
Statement shall require the audited financials of Loan, the
completion of NLMC's Form 10K and 10Q filings with the Securities
and Exchange Commission, and legends on the certificates for the
5,633,600 Shares restricting sale of more than 5% per month per
Shareholder (for a period ending June 1, 2002) after
effectiveness of the Registration Statement for all owners of
more than 200,000 Shares of NLMC including current owners of said
Shares (said 5% per month based on the number of shares held at
Closing shall apply to each month and shall not be increased by
aggregation with months in which such sales do not occur).
5.6 Filings. Promptly after this Closing, NLMC shall cause to be
filed with the United States Securities and Exchange Commission,
if necessary, the event report on Form 8-K, which report shall
provide information relative to the consummation of the
transaction provided for in this Agreement.
5.7 Outstanding Shares. NLMC expects that certain existing debts,
described hereto on Exhibit F will be settled in exchange for
Shares and upon extinguishment (or partial extinguishment) of
said debts and subsequent to the issuance of the 5,633,600 Shares
to Shareholders, NLMC will have no more than 12,133,600 issued
and outstanding Shares, except for Shares issued pursuant to cash
financing received subsequent to February 1, 2000.
6. Conduct of Loan's Business Prior to the Closing.
6.1 Operation in Ordinary Course. Between February 1, 2000 and the
Closing date, Loan and its subsidiaries have and shall conduct
their businesses in all material respects in the ordinary course.
6.2 Business Organization. Between the date of this Agreement and the
Closing date, Shareholders shall use their reasonable efforts,
and shall cause Loan and each of its subsidiaries to use its
respective reasonable efforts, to (a) preserve substantially
intact the business organization of Loan and each of its
subsidiaries and keep available the services of the present
officers and employees of Loan and each of its subsidiaries, and
(b) preserve in all material respects the present business
relationships and good will of Loan and each of its subsidiaries.
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6.3 Corporate Organization. Between the date of this Agreement and
the Closing date, Shareholders shall not cause or permit Loan of
its subsidiaries to sell, lease, license or otherwise dispose of
any of its properties or assets (including, but not limited to,
rights with respect to patents and registered trademarks and
copyrights or other proprietary rights), in an amount which is
material to the business or financial condition of Loan and its
subsidiaries, taken as a whole, except in the ordinary course of
business.
7. Survival of Representations and Warranties; Indemnification.
7.1 Survival. Each representation, warranty and covenant contained in
this Agreement or in any certificate or document delivered
pursuant hereto shall survive the Closing (the Surviving
Representations, Warranties and Covenants").
7.2 Indemnification by Shareholders. Shareholders shall indemnify and
hold harmless NLMC, and shall reimburse NLMC for, any loss,
liability, damage or expense (including reasonable attorney's
fees) (collectively, "Damages") arising from or in connection
with (a) any inaccuracy in any of the Surviving Representations,
Warranties and Covenants of Shareholders in this Agreement or (b)
any failure by Shareholders to perform or comply with any
agreement in this Agreement.
7.3 NLMC shall indemnify and hold harmless Shareholders, and shall
reimburse Shareholders for, any damages arising from or in
connection with (a) any inaccuracy in any of the Surviving
Representations, Warranties and Covenants of NLMC in this
Agreement, (b) any failure by NLMC to perform or comply with any
agreement in this Agreement.
8. Termination.
8.1 Termination. This Agreement may be terminated before the Closing
occurs only as follows:
(i) By written agreement of all of the Shareholders and NLMC at
any time prior to Closing.
(ii) By Shareholders, by notice to NLMC at any time, if one or
more of the conditions specified in Section 3 is not
satisfied at the time at which the Closing (as it may be
deferred pursuant to Section 1.3) would otherwise occur or
if satisfaction of such a condition is or becomes
impossible.
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(iii) By NLMC, by notice to Shareholders at any time, if one or
more of the conditions specified in Section 2 is not
satisfied at the time at which the Closing (as it may be
deferred pursuant to Section 1.3), would otherwise occur of
if satisfaction of such a condition is or becomes
impossible.
8.2 Effect of Termination. If this Agreement is terminated pursuant
to Section 8.1, this Agreement shall terminate without any
liability or further obligation of any party to another.
9. Notices.
All notices, consents, assignments and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given when
(a) delivered by hand, (b) sent by telex or telecopier (with receipt confirmed),
provided that a copy is mailed by registered mail, return receipt requested, or
(c) received by the delivery service (receipt requested), in each case to the
appropriate addresses, telex numbers and telecopier numbers set forth below (or
to such other addresses, telex numbers and telecopier numbers as a party may
designate as to itself by notice to the other parties):
NLMC: Shareholders:
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇/▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ (▇▇▇) ▇▇▇-▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇ - fax (▇▇▇) ▇▇▇-▇▇▇▇ - fax
10. Miscellaneous.
10.1 Expenses. Each party shall bear its own expenses incident to the
preparation, negotiation, execution and delivery of this
Agreement and the performance of its obligations hereunder.
10.2 Captions. The captions in this Agreement are for convenience of
reference only and shall not be given any effect in the
interpretation of this Agreement.
10.3 No Waiver. The failure of a party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be
considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any other term of
this Agreement. Any waiver must be in writing.
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10.4 Exclusive Agreement; Amendment. This Agreement supersedes all
prior agreements among the parties with respect to its subject
matter and is intended (with the documents referred to herein) as
a complete and exclusive statement of the terms of the agreement
among the parties with respect thereto and cannot be changed or
terminated orally.
10.5 Type B Reorganization. The parties intend that the transaction
described in this Agreement will qualify as a reorganization
under Section 368(a)(1)(B) of the Internal Revenue Code of 1986,
as amended (the "Code") and that the result in exchange of Shares
will not result in recognition of any gain or loss to NLMC under
Section 1032(a) of the Code or to the Shareholders under Section
354(a)(1) of the Code and the provisions of this Agreement shall
be interpreted consistent with that purpose and any provision
inconsistent thereto shall be deemed null and void.
10.6 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be considered an original, but
all of which together shall be the complete and binding
Agreement, provided however, initially, NLMC is prepared to sign
the Agreement with ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, with
the remaining Shareholders to sign at or prior to Closing.
10.7 Governing Law. This Agreement and (unless otherwise provided) all
amendments hereof and waiver and consents hereunder shall be
governed by the internal law of the State of Colorado, without
regard to the conflicts of law principles thereof.
10.8 Binding Effect. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their respective
successors and assigns.
NORTH LILLY MINING COMPANY
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President
/s/ W. ▇▇▇▇ ▇▇▇▇
----------------------------
W. ▇▇▇▇ ▇▇▇▇
Executive Vice President/Secretary
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SHAREHOLDERS:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ and /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇ as Joint
Tenants with Rights of Survivorship
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
13
Index of Exchange Agreement Exhibits
Exhibit A- Assets
Exhibit B- Encumbrances
Exhibit C- Shareholding's
Exhibit D- Litigation
Exhibit E- Obligations
Exhibit F- NLMC Payables
Exhibit G- Statement of Income & Expenses
AGREEMENT
This Agreement dated March 8, 2000 is by and among North Lilly Mining
Company, a Utah corporation ("NLMC"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and Home ▇▇▇▇.▇▇▇, Inc., a
Colorado corporation ("Loan"). Whenever all three parties are collectively
referred to in this Agreement, they shall be designated as the "parties".
WHEREAS, concurrent with the execution of this Agreement, an Exchange
Agreement was entered into by and between NLMC and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
(collectively the "Shareholders"); and
WHEREAS, the Exchange Agreement provided that the Shareholders Loan
exchanged all of the outstanding and issued shares of Loan in exchange for
5,633,600 shares of NLMC; and
WHEREAS, as a result of the Exchange Agreement, Loan became a wholly owned
subsidiary of NLMC; and
WHEREAS, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ has advanced funds and provided other
consideration to Loan and is therefore a creditor of Loan; and
WHEREAS, the parties to this Agreement believe that it is in the best
interests of the parties that any and all amounts that are owed to ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ should be extinguished, canceled and terminated; and
WHEREAS, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ has agreed to accept shares of NLMC in exchange
for all amounts owed to her and NLMC is willing to satisfy the debt of its
wholly owned subsidiary in exchange for its shares.
THE PARTIES THEREFORE AGREE AS FOLLOWS:
1. NLMC shall cause to be issued 199,000 shares to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ in
exchange for any and all advances and other consideration provided by
her to Loan.
2. Upon receipt of the 199,000 shares of NLMC, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ hereby
agrees for herself and all persons or entities that could or might act
on her behalf to release and forever discharge Loan and NLMC from any
and all claims, causes of actions, demands, obligations, of every kind
and nature whatsoever, in law or equity, which she now has or may have
against Loan or NLMC.
3. This Agreement supersedes all prior agreements among the parties with
respect to its subject matter and is intended (with the documents
referred to herein) as a complete and exclusive statement of the terms
of the agreement among the parties with respect thereto and cannot be
changed or terminated orally.
4. This Agreement shall be governed by the internal law of the State of
Colorado, without regard to the conflicts of law principles thereof.
5. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns.
NORTH LILLY MINING COMPANY
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President
/s/ W. ▇▇▇▇ ▇▇▇▇
----------------------------
W. ▇▇▇▇ ▇▇▇▇
Executive Vice President/Secretary
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
HOME ▇▇▇▇.▇▇▇, INC.
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
2
