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EXHIBIT 10.70
THE OFFER AND SALE OF THE SECURITIES REFERRED TO IN THIS AGREEMENT (THE
"OFFERING") HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS AND SUCH SHARES ARE
BEING OFFERED AND SOLD IN RELIANCE ON THE EXEMPTION FROM THE SECURITIES
REGISTRATION AND QUALIFICATION REQUIREMENTS OF THE ACT AND SUCH LAWS OFFERED BY
REGULATION S (PROMULGATED UNDER THE ACT). ACCORDINGLY, THE SECURITIES MAY NOT BE
TRANSFERRED OR RESOLD WITHOUT REGISTRATION AND QUALIFICATION UNDER THE ACT AND
APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM SUCH REGISTRATION AND
QUALIFICATION UNDER THE ACT AND SUCH LAWS IS THEN AVAILABLE. THE OFFER AND SALE
OF THE SECURITIES EFFECTED HEREBY HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER
REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR
ENDORSED THE MERITS OF THE OFFERING.
COMMITMENT FEE AGREEMENT
THIS COMMITMENT FEE AGREEMENT ("Agreement") effective as of December 31,
1998 between CONSOLIDATED CAPITAL OF NORTH AMERICA, INC., a Colorado corporation
(the "Company") and the entities set forth on Schedule I hereto (each, a
"Lender" and collectively the "Lenders").
RECITAL
WHEREAS, the Lenders provided a standby commitment of $1,000,000 to the
Company (the "Commitment"); and
WHEREAS, the Company has agreed to reimburse the Lenders for the expenses
of the Lender relating to the Commitment and to pay a commitment fee on the
terms set forth in this Agreement;
NOW, THEREFORE, in consideration of the foregoing and of the terms and
conditions contained in this Agreement, the Company and the Lenders agree as
follows:
1. COMMITMENT FEE. In consideration of providing the Commitment, the
Company shall issue to the Lenders set forth on Schedule I hereto and in the
denominations set forth on Schedule I hereto (a) Warrants to purchase 1,000,000
shares of the Company's Common Stock par value $.0001 per share (the "Common
Stock") having the terms set forth in Exhibit A attached hereto
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(the "Exhibit A Warrants") and (b) Warrants to purchase 1,000,000 shares of
Common Stock having the terms set forth in Exhibit B attached herein (the
"Exhibit B Warrants"). The Exhibit A Warrants and the Exhibit B Warrants are
collectively referred to herein as the "Warrants."
2. EXPENSE REIMBURSEMENT. The Company shall compensate the Lenders for
expenses relating to the Commitment by (a) providing a credit in the amount of
$75,000 (the "Warrant Exercise Credit") which may be used by the holder of the
Exhibit A Warrant solely as the consideration for purchasing Warrant Shares (as
such terms is defined in Section 3.1 (d)) as set forth in the Exhibit A Warrant
and (b) 250,000 shares of Common Stock of the Company (the "Compensation
Shares").
3. REPRESENTATIONS AND WARRANTIES.
3.1 Representations and Warranties of the Company. The Company represents
and warrants that:
(a) Existence. The Company is a corporation duly organized and in good
standing under the laws of the State of Colorado and is duly qualified to
do business and is in good standing in all states where such qualification
is necessary, except for those jurisdictions in which the failure to
qualify would not, in the aggregate, have a material adverse effect on the
Company's financial condition, results of operations or business.
(b) Authority. The execution and delivery by the Company of this
Agreement and the Warrants (i) are within the Company's corporate powers;
(ii) are duly authorized by the Company's board of directors; (iii) are not
in contravention of the terms of the Company's certificate of incorporation
or bylaws; (iv) are not in contravention of any law or laws; (v) do not
require any governmental consent, registration or approval; (vi) do not
contravene any contractual or governmental restriction binding upon the
Company; and (vii) will not result in the imposition of any lien, charge,
security interest or encumbrance upon any property of the Company under any
existing indenture, mortgage, deed of trust, loan or credit agreement or
other material agreement or instrument to which the Company is a party or
by which the Company or any of the Company's property may be bound or
affected.
(c) Binding Effect. This Agreement and the Warrants have been duly
authorized, executed and delivered by the Company and constitute the valid
and legally binding obligation of the Company, enforceable in accordance
with their respective terms, subject to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(d) Capitalization. The authorized capital stock of the Company as of
December 28, 1998 consists of 200,000,000 shares of Common Stock, par value
$.0001 per share, 47,984,384 shares of which were issued and outstanding on
December 28, 1998 and 10,000,000 shares of Preferred Stock, par value $.01
per share, of which the following Preferred Shares were authorized, issued
and outstanding on December 28, 1998; Series A Preferred Shares, par value
$1.00 per share, authorized 1,000,000 shares, 744,000
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shares issued and outstanding; Series B Preferred Shares, par value $1.00
per share, authorized 1,000,000 shares, 449,000 shares issued and
outstanding; Series C Preferred Shares, stated value $10,000 per share,
authorized 200 shares, 0 shares issued and outstanding; Series D Preferred
Shares, stated value of $10,000 per share, authorized 350 shares, 0 shares
issued and outstanding; and Series E Preferred Shares, stated value $10,000
per share, authorized 140 shares, 0 shares issued and outstanding. The
shares of Common Stock issuable upon exercise of the Warrants (the "Warrant
Shares") and the Compensation Shares are not subject to preemption rights
and have been duly and validly authorized and reserved for issuance and,
when issued and delivered in accordance with the terms of this Agreement,
will be duly and validly issued, fully paid and non-assessable and shall be
free of any and all encumbrances, claims, security interests or any other
rights or interests of third parties whatsoever. The Company shall at all
times have authorized, reserved and set aside a sufficient number of shares
of Common Stock for the exercise of the Warrants. The Compensation Shares
and the Warrant Shares are sometimes collectively referred to herein as the
"Shares". The Warrants and the Shares are sometimes collectively referred
to herein as the "Securities."
(e) SEC Documents. The Company has furnished the Lender with a true
and complete copy of the Company's Report on Form 8-K filed on January 27,
1998, as amended on January 29, 1998 and March 27, 1998, Report on Form 8-K
filed on January 28, 1998 as amended on January 29, 1998, Report on Form
8-K filed on March 18, 1998, Report on Form 8-K filed on May 1, 1998,
Report on Form 8-K filed on August 5, 1998, Report on Form 8-K filed on
September 18, 1998, Report on Form 8-K filed on January 27, 1999, the
Company's Form 10-KSB for the fiscal year ended December 31, 1997, Form
10-QSB for the quarterly period ended March 31, 1998, Form 10-QSB for the
quarterly period ended June 30, 1998, Form 10-QSB for the quarter ended
September 30, 1998 and the Registration Statement on Form SB-2 (No.
333-60761) and the Proxy Statement dated October 16, 1998 (the "Disclosure
Documents"). Except as disclosed in the Disclosure Documents, and except in
connection with the acquisition of Toledo Pickling Steel and Sales, Inc.,
since December 31, 1997 the Company has not incurred any material liability
except in the ordinary course of its business consistent with past
practice, and there has not been any change in the business, financial
condition or results of operations of the Company which has had a material
adverse effect on the Company. Since January 1, 1997, the Company has filed
with the Securities and Exchange Commission (the "SEC") all documents
required to be filed pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations promulgated
thereunder. As of their respective filing dates, the Disclosure Documents
complied in all material respects with the requirements of the Exchange
Act, and the rules and regulations of the SEC thereunder applicable to such
Disclosure Documents, and the Disclosure Documents did not contain any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
The financial statements of the Company included in the Disclosure
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published
rules and regulations of the SEC with respect thereto. The Financial
Statements are accurate, complete and have been prepared in accordance with
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the books and records of the Company and in accordance with generally
accepted accounting principles applied on a consistent basis during the
periods involved (except as may be indicated in the notes thereto and
fairly present (subject, in the case of the unaudited statements, to
normal, recurring audit adjustments that are not material) the consolidated
financial position of the Company as at the dates thereof and the
consolidated results of its operations and cash flows for the periods then
ended.
(f) Litigation. There is neither pending nor, to the Company's
knowledge and belief, threatened any action, suit, proceeding or claim, or
any basis therefor, to which the Company is or may be named as a party or
its property is or may be subject other than routine litigation in the
ordinary course of business or which calls into question any of the
transactions contemplated by this Agreement.
(g) Conflict with Other Agreements; Approvals. The execution and
delivery of this Agreement does not, and the consummation of the
transactions contemplated hereby will not, conflict with or (i) result in
any violation of, or default (with or without notice of lapse of time, or
both) under, or giver rise to a right of termination, cancellation or
acceleration of any obligation or the loss of a material benefit under, or
the creation of a lien, pledge, security interest or other encumbrance on
assets (any such conflict, violation, default, right of termination,
cancellation or acceleration, loss or creation, a "Violation") pursuant to
any provision of the Articles of Incorporation or By-laws or any
organizational document of the Company or (ii) result in any Violation of
any loan or credit agreement, note, mortgage, indenture, lease benefit plan
or other agreement, obligation, instrument, permit, concession, franchise,
license, judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to the Company or its properties or assets. No
consent, approval, order or authorization of, or registration, declaration
or filing with, any court, administrative agency or commission or other
governmental authority or instrumentality, domestic or foreign (a
"Governmental Entity") or any other third party is required by or with
respect to the Company in connection with the execution and delivery of
this Agreement by the Company or the consummation by the Company of the
transactions contemplated hereby.
(h) Securities Matters. (i) Subject to the accuracy of the
representations of the Lender set forth in Section 3.2 hereof, the offer,
sale and issuance of the Securities as contemplated by this Agreement are
exempt from the registration requirements of the Securities Act of 1933 as
amended (the "Securities Act") pursuant to Regulation S as promulgated
under the Securities Act.
(ii) The Company is a "Domestic Issuer" and a "Reporting Issuer,"
as such terms are defined by Rule 902 of Regulation S. The Company has
registered its Common Stock pursuant to Section 12(b) or (g) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")
requirements of either Section 13(a) or 15(d) of the Exchange Act. The
Company's Common Stock trades on the OTC Bulletin Board under the
symbol CDNO.
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(iii) The Company has not offered the Securities to any person in
the United States, any identifiable group of U.S. citizens abroad, or
to any U.S. Person.
(iv) At the time the buy order was originated, the Company and/or
its agents reasonably believed Lender was outside the United States
and was not a U.S. Person.
(v) The Company and/or its agents reasonably believe that the
sale of the Securities has not been prearranged with a Lender in the
United States.
(vi) The Company has not conducted any "directed selling efforts"
with respect to the Securities nor has Lender conducted any general
solicitation (as that term is used in Regulation D under the
Securities Act) with respect to the Securities.
(vii) The Company will issue one or more Certificates
representing the Securities in the name of Company with the following
restrictive legend set forth below (the "Restrictive Legend") in such
denominations to be specified by the Lender:
"The Securities represented by this Certificate have not
been registered under the United States Securities Act of
1933 (the "Act") and may not be sold, transferred, pledged
or otherwise hypothecated by the original holder of the
Securities or any subsequent holder unless (a) they are
covered by a registration statement or a post-effective
amendment thereto under the Act, (b) they are covered by an
exemption available under Regulation S promulgated under the
Act, or (c) in the opinion of counsel for Company, which
opinion shall be reasonably acceptable to the Company, such
sale, transfer, pledge or hypothecation is otherwise exempt
from the provisions of Section 5 of the Act."
3.2 Representations and Warranties of each Lender . Each Lender represents
and warrants that:
(a) Authorization. This Agreement constitutes a valid and legally
binding obligation of the Lender.
(b) Investment Representations (i) The Lender is not a "U.S.
Person" as defined by Rule 902 of Regulation S, was not organized
under the laws of any U.S. jurisdiction, and was not formed for the
purpose of investing in securities not registered under the Securities
Act.
(ii) The Lender is not a "distributor" as defined by Rule 902 of
Regulation S.
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(iii) At the time the purchase order for this transaction was
originated, the Lender was physically outside of the United States and
such purchase order was not the result of directed selling efforts by
the Company in the United States.
(iv) No offer to purchase the Securities was made by the Lender
while in the United States.
(v) The Lender is purchasing the Securities for its own account
for investment purposes and not with a view towards distribution.
(vi) The Lender acknowledges and agrees that the offer and sale
of the Securities by the Company has not been registered under the
Securities Act and agrees that all subsequent offers and sales of the
Securities will be made (i) outside the United States in compliance
with Rule 903 or Rule 904 of Regulations S, (ii) pursuant to
registration of the Securities under the Securities Act, or (iii)
pursuant to an exemption from such registration. The Lender
understands the conditions of the exemption from registration afforded
by Regulation S and Section 4(1) of the Securities Act and
acknowledges that there can be no assurance that it will be able to
rely on either exemption. Furthermore, the Lender will not resell the
Securities to U.S. Persons or within the United States until after the
end of the applicable restricted period under Regulation S or any the
applicable restricted period under the Securities Act (the "Restricted
Period") other than pursuant to registration of the Securities under
the Securities Act or pursuant to an exemption from such registration.
(vii) The Lender agrees that, at all times after the execution of
this Agreement by the Lender and prior to the expiration of the
Restricted Period, it will keep its purchase of the Securities
confidential, except as required by law and except as necessary in the
ordinary course of Lender's business.
(viii) The Lender understands that the Securities are being
offered and sold to it in reliance on specific provisions of United
States Federal and States securities laws and that the Company is
relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgments and understandings of the
Lender set forth herein in order to determine the applicability of
such provisions. Accordingly, the Lender agrees to notify the Company
of any events which would cause the representations and warranties of
the Lender to be untrue or breached at any time after the execution of
this Agreement by the Lender and prior to the expiration of the
Restricted Period.
(ix) All offering documents received by the Lender include
statements to the effect that the Securities have not been registered
under the Securities Act and may not be offered or sold in the United
States or to U.S. Persons during the Restricted Period unless pursuant
to registration of the Securities under the Securities Act or pursuant
to an exemption from such registration.
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(x) The Company did not attempt to, and did not induce Lender to
purchase the Securities.
(xi) The Lender agrees to hold the Company and its directors,
officers and controlling persons and their respective heirs,
representatives, successors and assigns harmless and to indemnify them
against all liabilities, costs and expenses incurred by them as a
result of any misrepresentation made by the Lender contained herein or
any sale or distribution of the Securities by the Lender in violation
of applicable federal and state securities laws. This indemnification
agreement shall survive the closing of this transaction.
(xii) The Lender has received and reviewed the Company's
Disclosure Documents and the Lender or the Lender's designated
representatives have concluded a satisfactory due diligence
investigation of the Company and have had an opportunity to review the
documents provided by the Company and to have all of their questions
related thereto satisfactorily answered.
(xiii) The Lender acknowledges that the Securities are
speculative and involve a high degree of risk and the Lender
represents that it is able to sustain the loss of the entire amount of
its investment.
(xiv) The Lender (or its members and/or officers) has previously
invested in unregistered securities and has sufficient financial and
investing expertise to evaluate and understand the risks of the
Securities.
(xv) The Lender has received from the Company, and is relying on,
no representations (except as set forth in this Agreement) or
projections with respect to the Company's business and prospects.
(xvi) The Lender acknowledges and agrees not to engage in any
hedging transactions involving the Securities unless such transactions
comply with the Securities Act.
4. Registration under the Securities Act of 1933.
4.1 Registration of Shares. The Company shall promptly prepare and file
with the SEC a registration statement on or before March 31, 1999, which
registration statement shall include the Shares, and shall thereafter use its
best efforts to have such registration statement declared effective as soon as
possible and shall ensure that such registration statement remains effective
until the earlier of the date on which all the Shares are sold or three years
after the initial effective date (the "Effective Period"). The Company shall
prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be
necessary to keep such registration statement effective throughout the Effective
Period and to comply with the provisions of the Securities Act with respect to
the sale or other disposition of the Shares whenever the Lender shall desire to
sell or otherwise dispose of the same in whole or in part.
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4.2 Participation in Registered Offerings ("Piggyback Rights" for Shares).
If the Company at any time after the date of this Agreement and prior to the
third anniversary of the date of this Agreement proposes or is required to
register any of its shares or other equity securities for public sale for cash
under the Securities Act (other than on Forms S-4 or S-8), it will at each such
time or times give written notice to each Lender of its intention to do so. Upon
the written request of any Lender given within twenty (20) days after receipt of
any such notice, the Company shall use its best efforts to cause to be included
in such registration any Shares held by such Lender or Shares obtainable upon
conversion of the Warrants and requested to be registered under the Securities
Act and any applicable state securities laws; provided, that if the managing
underwriter (if any) advises that less than all of the shares to be registered
should be offered for sale so as not materially and adversely to affect the
price or salability of the offering being registered by the Company, the Lender
(but not the Company to the extent it desires to include shares for its own
account) shall reduce the number of its shares to be included in the
registration statement as required by the underwriter to the extent requisite to
permit the sale or other disposition (in accordance with the intended method of
disposition thereof as aforesaid) by the prospective seller or sellers of the
securities so registered. The registration requested pursuant to this Section
4.2 is referred to herein as the "Piggyback Registration". The Lenders
registration rights more fully set forth in subsection 4.1 hereof are in
addition to their "Piggyback Registration" rights. Nothing in this subsection
will provide any underwriter of the Company's Common Stock with any veto or
other rights under subsection 4.1 hereof.
4.3 Obligations of each Lender. It shall be a condition precedent to the
obligation of the Company to register any Shares pursuant to this Section 4 that
each Lender shall furnish to the Company such information regarding the Shares
held and the intended method of disposition thereof and any other information
concerning the Lender as the Company shall reasonably request and as shall be
required in connection with the registration statement to be filed by the
Company. If after a registration statement becomes effective the Company advises
the Lenders that the Company considers it appropriate to amend or supplement the
applicable registration statement, each Lender shall suspend further sales of
the Shares until the Company advises such Lender that such registration
statement has been amended or supplemented.
4.4 Registration Proceedings. Whenever the Company is required by the
provisions of this Section 4 to effect the registration of the Shares under the
Securities Act, the Company shall:
(i) Prepare and file with the SEC a registration statement with
respect to such securities and use its best efforts to cause such
registration statement to become and remain effective;
(ii) Prepare and file with the SEC such amendments to such
registration statement and supplements to the prospectus contained
therein as may be necessary to keep such registration statement
effective;
(iii) Furnish to each Lender and to the underwriters of the
securities being registered such reasonable number of copies of the
registration statement, preliminary
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prospectus, final prospectus and such other documents as such
underwriters may reasonably request in order to facilitate the public
offering of such securities;
(iv) Use its best efforts to register or qualify the securities
covered by such registration statement under such state securities or
Blue Sky Laws of such jurisdictions as each Lender may reasonably
request within twenty (20) days following the original filing of such
registration statement, except that the Company shall not for any
purpose be required to execute a general consent to service of process
or to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified;
(v) Notify each Lender, promptly after it shall receive notice
thereof, of the time when such registration statement has become
effective or a supplement to any prospectus forming a part of such
registration statement has been filed;
(vi) Notify each Lender promptly of any request by the SEC for
the amending or supplementing of such registration statement or
prospectus or for additional information; and
(vii) Prepare and promptly file with the SEC and promptly notify
each Lender of the filing of such amendment or supplement to such
registration statement or prospectus as may be necessary to correct
any statements or omissions if, at the time when a prospectus relating
to such securities is required to be delivered under the Securities
Act, any event shall have occurred as the result of which any such
prospectus or any other prospectus as then in effect would include an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading. Notwithstanding
any provision herein to the contrary, the Company shall not be
required to amend, supplement, or update a prospectus contained in any
registration statement if to do so would result in an unduly
burdensome expense to the Company.
4.5 Expenses. With respect to the inclusion of the Shares in a
registration statement pursuant to this Section 4, all registration expenses,
fees, costs and expenses of and incidental to such registration, inclusion and
public offering in connection therewith shall be borne by the Company; provided,
however, that each Lender shall bear its own professional fees and pro rata
share of the underwriting discount and commissions (if such Shares are included
in an underwritten offering). The fees, costs and expenses of registration to be
borne by the Company shall include, without limitation, all registration,
filing, printing expenses, fees and disbursements of counsel and accountants for
the Company, fees and disbursements of counsel for the underwriter or
underwriters of such securities (if the Company and/or selling security holders
are required to bear such fees and disbursements), and all legal fees and
disbursements and other expenses of complying with state securities or Blue Sky
Laws of any jurisdiction in which the securities to be offered are to be
registered or qualified.
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4.6 Indemnification of the Lender. Subject to the conditions set forth
below, in connection with any registration of the Shares pursuant to this
Section 4, the Company agrees to indemnify and hold harmless each Lender, any
underwriter for the Company or acting on behalf of the Company and each person,
if any, who controls such Lender, within the meaning of Section 15 of the
Securities Act, as follows:
(i) Against any and all loss, claim, damage and expense
whatsoever arising out of, based upon or resulting from (including,
but not limited to, any and all expense whatsoever reasonably incurred
in investigating, preparing or defending any litigation, commenced or
threatened, or any claim whatsoever based upon) any untrue or alleged
untrue statement of a material fact contained in any preliminary
prospectus (if used prior to the effective date of the registration
statement), the registration statement or the prospectus (as from time
to time amended and supplemented), or in any application or other
document executed by the Company or based upon written information
furnished by the Company filed in any jurisdiction in order to qualify
the Company's securities under the securities laws thereof, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading, or any other violation of applicable federal or state
statutory or regulatory requirements or limitations relating to action
or inaction by the Company in the course of preparing, filing, or
implementing such registered offering; provided, however, that the
indemnity agreement contained in this section shall not apply to any
loss, claim, damage, liability or action arising out of or based upon
any untrue or alleged untrue statement or omission made in reliance
upon and in conformity with any information furnished in writing to
the Company by or on behalf of the Lender expressly for use in
connection therewith or arising out of any action or inaction of the
Lender ;
(ii) Subject to the proviso contained in Subsection (i) above,
against any and all loss, liability, claim, damage and expense
whatsoever to the extent of the aggregate amount paid in settlement of
any litigation, commenced or threatened, or of any claim whatsoever
based upon any untrue statement or omission (including, but not
limited to, any and all expense whatsoever reasonably incurred in
investigating, preparing or defending against any such litigation or
claim) if such settlement is effected with the written consent of the
Company; and
(iii) In no case shall the Company be liable under this indemnity
agreement with respect to any claim made against such seller,
underwriter or any such controlling person unless the Company shall be
notified, by letter or by facsimile confirmed by letter, of any action
commenced against such persons, promptly after such person shall have
been served with the summons or other legal process giving information
as to the nature and basis of the claim. The failure to so notify the
Company, if prejudicial in any material respect to the Company's
ability to defend such claim, shall relieve the Company from its
liability to the indemnified person under this Section 4, but only to
the extent that the Company was prejudiced. The failure to so notify
the Company shall not relieve the Company from any liability which it
may have
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otherwise than on account of this indemnity agreement. The Company
shall be entitled to participate at its own expense in the defense of
any suit brought to enforce any such claim, but if the Company elects
to assume the defense, such defense shall be conducted by counsel
chosen by it, provided such counsel is reasonably satisfactory to the
sellers or controlling persons, defendants in any suit so brought. In
the event the Company elects to assume the defense of any such suit
and retain such counsel, the sellers, underwriter or controlling
persons, defendants in the suit, shall, after the date they are
notified of such election, bear the fees and expenses of any counsel
thereafter retained by them, as well as any other expenses thereafter
incurred by them in connection with the defense thereof; provided,
however, that if the sellers, underwriter or controlling persons
reasonably believe that there may be available to them any defense or
counterclaim different than those available to the Company or that
representation of such sellers, underwriters or controlling persons by
counsel for the Company presents a conflict of interest for such
counsel, then such sellers, underwriter and controlling person shall
be entitled to defend such suit with counsel of their own choosing and
the Company shall bear the fees, expenses and other costs of such
separate counsel.
5. MISCELLANEOUS.
5.1 Assignability; Successors. The provisions of this Agreement shall
inure to the benefit of and be binding upon the permitted successors and assigns
of the parties hereto.
5.2 Survival. All agreements, covenants, representations and warranties
made by the Company or by the Lender herein shall survive the execution and
delivery of this Agreement.
5.3 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED ACCORDING TO THE LAWS
OF THE STATE OF COLORADO WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
RELATING TO CONFLICTS OF LAWS.
5.4 Counterparts: Headings. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but such counterparts
shall together constitute but one and the same agreement. The descriptive
headings in this Agreement are inserted for convenience of reference only and
shall not affect the construction of this Agreement.
5.5 Entire Agreement, Amendments. This Agreement and the Exhibits contain
the entire understanding of the parties with respect to the subject matter
hereof, and supersede all other representations and understandings, oral or
written, with respect to the subject matter hereof. No amendment, modification,
alteration, or waiver of the terms of this Agreement or consent required under
the terms of this Agreement shall be effective unless made in a writing, which
makes specific reference to this Agreement and which has been signed by the
Company and the Lender. Any such amendment, modification, alteration, waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
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5.6 Notices. All communications or notices required or permitted by this
Agreement shall be in writing and shall be deemed to have been given or made
when delivered in hand, deposited in the mail, or sent by facsimile, with
confirmation (if sent by facsimile on a non-business day, receipt shall be
deemed to have occurred on the next succeeding business day). Communications or
notices shall be delivered personally or by certified or registered mail,
postage, or by facsimile and addressed as follows, unless and until either of
such parties notifies the other in accordance with this Section of a change of
address:
if to the Company Consolidated Capital of North America, Inc.
000 00xx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Att: Secretary
Tel: (000) 000-0000
Fax: (000) 000-0000
with copies to: Xxxxxxxxx, Xxxxxx & Xxxxxx
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxx Xxxxxx 00000
Att: Xxxxxx X. Xxxxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
if to the Lender: c/o Jones, Day, Xxxxxx & Xxxxx
000 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Att: Xxxxxxx X. Xxxxxx, Esq.
Tel: 000-000-0000
Fax: 000-000-0000
5.7 Severability. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and
year first above written.
CONSOLIDATED CAPITAL
OF NORTH AMERICA, INC.
By: /s/ Xxxxxxx Xxxxxx
--------------------------------------
Xxxxxxx Xxxxxx
President and Chief Operating Officer
INNOVEST HOLDINGS, LTD.
By:
--------------------------------------
Name:
Title:
ACCPAC HOLDINGS, LTD.
By:
--------------------------------------
Name:
Title:
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Schedule I
Lender Warrants to be Issued
------ ---------------------
Innovest Holdings, Ltd. 1,000,000 - Exhibit A Warrants
Accpac Holdings, Ltd. 1,000,000 - Exhibit B Warrants
Lender Shares to be Issued
------ -------------------
Innovest Holdings, Ltd. 250,000
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