EXHIBIT 10.4
STOCK PURCHASE AND PARTIAL BUSINESS SEPARATION AGREEMENT
This Stock Purchase and Partial Business Separation Agreement (this
"Agreement") is made and entered into as of November 2, 2001, by and between
MAII Holdings, Inc., a Texas corporation ("MAII"), and GenesisIntermedia, Inc.,
a Delaware corporation ("GENI"), Car Rental Direct, Inc., a Nevada corporation
("CRD"), f.k.a. MAII Acquisition. MAII, GENI and CRD are sometimes each referred
to herein as a "Party", and collectively as the "Parties".
WITNESSETH:
WHEREAS, MAII acquired CRD from GENI pursuant to an Agreement and Plan
of Merger, dated as of August 16, 2001, by and among MAII, GENI and CRD (the
"Merger Agreement"); and
WHEREAS, GENI currently owns 752,000 shares of the common stock, par
value $0.002 per share, of MAII (the "Shares"), including 148,027 shares of
common stock of MAII currently in MAII's possession; and
WHEREAS, MAII and GENI desire to redefine their business relationship
to the extent provided herein;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:
1. Purchase of Stock. On the date hereof, MAII hereby agrees to
purchase from GENI, and GENI hereby agrees to sell to MAII, the Shares, at an
aggregate purchase price of $985,000 (the "Share Purchase Price"), which Share
Purchase Price shall be payable as provided in Section 4 below.
2. Assignment and Closing of Ajax Transaction. GENI has informed MAII
that GENI is unable to complete its acquisition (the "Acquisition") of all of
the capital stock of Ajax Rent-A-Car, Inc., a California corporation ("Ajax"),
and all related assets of the Ajax Rent-A-Car business previously conducted by
Xxxxxx Oh (the "Business"). Simultaneously with the execution and delivery of
this Agreement by the Parties, GENI, MAII, Ajax and Mr. Oh will execute and
deliver a Xxxx of Sale and Assignment Agreement, in substantially the form of
Exhibit A attached hereto, and CRD hereby agrees to cause the Acquisition to
close (the "Assignment Agreement").
3. Settlement of Certain Claims. In connection with the merger
undertaken pursuant to the Merger Agreement and the representation, warranties,
covenants and agreements contained in the Merger Agreement, MAII has made
certain claims against GENI for breaches of certain representations, warranties,
covenants and agreements and claims under certain indemnification side letters,
which claims are described in Exhibit B attached hereto (the "Claims"). The
Parties hereto agree to settle the Claims by a payment by GENI to MAII of
$1,000,000 (the "Claims Settlement Amount"). The Claims Settlement Amount shall
be paid by the issuance and delivery to MAII by GENI of a promissory note,
substantially in the form of Exhibit C attached hereto. In addition,
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GENI and MAII hereby agree that the provisions of Section 4.9 of the Merger
Agreement are hereby terminated in their entirety.
4. Payments. The Share Purchase Price shall be payable as follows: (i)
$800,000 shall be payable by wire transfer to GENI (the "GENI Wire"); and (ii)
the remaining $185,000 shall be payable to Xxxxxx Oh pursuant to the Assignment
Agreement. The GENI Wire shall be to GENI's brokerage account which holds the
Shares, instructions for which shall be delivered in writing by GENI to MAII.
Upon GENI's confirmation that the GENI Wire has been wired into GENI's account,
GENI shall immediately cause the Shares to be transferred by GENI to MAII
through the Depository Trust Company to MAII's account at Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx, Inc., DTC No 5198, for Acct. No. 542-07J81. Immediately after
receiving notification that MAII has received the Shares in its account at
Xxxxxxx Xxxxx, MAII shall send written confirmation of the receipt of the Shares
to GENI. GENI agrees not to withdraw, transfer, spend or otherwise dissipate the
Wired Payment funds until GENI has received written confirmation from MAII or
independent verification from Xxxxxxx Xxxxx that the Shares have been received
by MAII.
5. Releases.
(a) Release by GENI. GENI, on its own behalf and on behalf of
its directors, officers, agents, employees, and the respective successors, and
assigns of each of the foregoing (collectively, the "GENI Releasors") agree to
release and do hereby release, acquit and forever discharge MAII and its
directors, officers, agents, employees and the respective successors and assigns
of each of the foregoing (collectively, the "MAII Releasees") from, and
extinguishes, any and all claims, demands, debts, damages, costs, losses,
expenses, commissions, actions, causes of action, rights, liabilities,
obligations and choses in action of whatever nature or type which any of the
GENI Releasors have, or may have, or which have been, or could have been, or in
the future otherwise might have been asserted in connection with the Claims
and/or the sale of the Shares to MAII (the "GENI Claims"), except that in no
event shall this paragraph operate to release any of the MAII Releasees from any
claims or liability resulting from a breach of the representations, warranties,
covenants and agreements of MAII contained in this Agreement.
(b) Release by MAII. MAII, on its own behalf and on behalf of
its directors, officers, agents, employees, and the respective successors, and
assigns of each of the foregoing (collectively, the "MAII Releasors") agree to
release and do hereby release, acquit and forever discharge GENI and its
directors, officers, agents, employees and the respective successors and assigns
of each of the foregoing (collectively, the "GENI Releasees") from, and
extinguishes, any and all claims, demands, debts, damages, costs, losses,
expenses, commissions, actions, causes of action, rights, liabilities,
obligations and choses in action of whatever nature or type which any of the
MAII Releasors have, or may have, or which have been, or could have been, or in
the future otherwise might have been asserted in connection with the Claims
and/or the sale of the Shares to MAII (the "MAII Claims"), except that in no
event shall this paragraph operate to release any of the GENI Releasees from any
claims or liability resulting from a breach of the representations, warranties,
covenants and agreements of GENI contained in this Agreement.
(c) Other Agreements and Arrangements. The releases set forth
in this Section 5 are only as to the matters set forth therein, and do not in
any way effect any other agreements, arrangements or understandings of the
Parties, nor do they affect any other representations,
warranties, covenants or agreements which the Parties have given under the
Merger Agreement and related documents, instruments and agreements.
6. Representations and Warranties of GENI. GENI hereby represents and
warrants that the following are true and correct as of the date hereof:
(a) GENI is a corporation validly existing and in good
standing under the laws of the State of Delaware. GENI has the corporate power
and authority to execute, deliver and perform its obligations under this
Agreement, and the execution, delivery and performance by it of this Agreement
has been duly authorized by all necessary action, and this Agreement constitutes
the valid and binding obligation of GENI, enforceable against it in accordance
with the terms hereof.
(b) GENI owns the Shares free and clear of liens, security
interests and other encumbrances and/or claims of any kinds, and will transfer
the Shares to MAII hereunder free and clear of any liens, security interests and
other encumbrances and claims of any kind.
(c) None of the GENI Releasors have assigned, sold, conveyed
or otherwise transferred all or any portion of the GENI Claims.
7. Representations and Warranties of MAII. MAII hereby represents and
warrants that the following are true and correct as of the date hereof:
(a) MAII is a corporation validly existing and in good
standing under the laws of the State of Texas. MAII has the corporate power and
authority to execute, deliver and perform its obligations under this Agreement,
and the execution, delivery and performance by it of this Agreement has been
duly authorized by all necessary action, and this Agreement constitutes the
valid and binding obligation of MAII, enforceable against it in accordance with
the terms hereof.
(b) None of the MAII Releasors have assigned, sold, conveyed
or otherwise transferred all or any portion of the MAII Claims.
8. Amendment and Assignment. This Agreement may be amended, modified or
supplemented only by an instrument in writing executed by all the parties
hereto. This Agreement shall extend to and be binding upon each of the parties
and their respective successors and assigns, and any corporation or other entity
into or with which any party hereto may merge or consolidate.
9. Notice. Any notice or communication must be in writing and given by
depositing the same in the United States mail, addressed to the party to be
notified, postage prepaid and registered or certified with return receipt
requested, or by delivering the same in person or by facsimile. Any such notice
or communication shall be deemed received, if not earlier received, on the third
business day following the date on which it is mailed, or on the day on which it
is hand delivered or delivered by facsimile, as the case may be.
10. Disclosure. The parties hereto acknowledge and agree that both
parties will be required to disclose the transactions contemplated hereunder
pursuant to United States securities laws, and that MAII intends, and shall be
permitted, to issue a press release and/or file a Form 8-K describing the
transactions contemplated herein.
11. Entire Agreement. This Agreement contains the entire agreement of
the parties hereto with respect to the subject matter hereof, and supersedes all
prior agreements and understandings, oral or written, between the parties hereto
relating to the subject matter hereof.
12. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable by a court of competent jurisdiction, such
provisions shall be deemed severable and this Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable provisions did not
comprise a part hereof unless the loss of such provision causes this Agreement
to fail of its essential purpose; and the remaining provisions hereof shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance herefrom except as
aforesaid. Furthermore, in lieu of such illegal, invalid or unenforceable
provision, the parties agree to meet to determine in good faith, or will ask the
court to determine, a provision as similar in its terms to such illegal, invalid
or unenforceable provision as may be possible and be legal, valid and
enforceable and such provision so determined shall then be added as part of this
Agreement.
13. Governing Law. This Agreement and the rights and obligations of the
parties hereto, shall be governed, construed and enforced in accordance with the
laws of the State of California.
14. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, and all of which together shall constitute
one and the same document.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
MAII HOLDINGS, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Xxxxxxxx X. Xxxxx,
Chief Executive Officer
CAR RENTAL DIRECT, INC.
By: /s/ Xxxxxxxx X. Xxxxx
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Xxxxxxxx X. Xxxxx,
Chief Executive Officer
GENESISINTERMEDIA, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Chief Executive Officer
