THIRD CAPITAL, LLC
NINTH FLOOR
000 XXXXXX XXXXXX
XXXXXXXXX, XXXXXXXXX 00000
FAX: 000.000.0000
000.000.0000
OPTION TO PURCHASE 760,000 COMMON SHARES
OF
TIS MORTGAGE INVESTMENT COMPANY
This Agreement entered into on March 16, 1998, is executed by and between Third
Capital, LLC ("Third Capital") and Turkey Vulture Fund XIII, Ltd. (the "Fund")
regarding certain shares of stock the Fund owns in TIS Mortgage Investment
Company ("TIS" or the "Company").
NOW THEREFORE, in consideration of good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties agree as follows:
1. The Fund owns a minimum of 760,000 shares of common stock of TIS (the
"Shares").
2. The Fund hereby grants Third Capital the option to purchase the Shares
at any time prior to March 31, 1999. If this option is exercised prior to
August 1, 1998, the exercise price shall be equal to the greater of $2.00
per common share or the then "current market price". If this option is
exercised thereafter during the option term (as defined in paragraph 7
hereof), the exercise price shall be equal to the greater of $2.25 per
common share or the then "current market price". Third Capital shall notify
the Fund in writing of its exercise of the option granted herein and
payment for the Shares shall be due in cash or wire transfer at closing.
"Current market price" shall mean the average of the last reported sale
price of TIS common stock on the ten trading days prior to the exercise of
the option.
3. The Fund hereby agrees that it will not sell, gift or otherwise transfer
the Shares (or any rights related thereto) so long as the option rights set
forth above shall remain outstanding.
4. The Fund hereby agrees to execute the Irrevocable Proxy attached hereto
as Exhibit A, which grants Xxxxxxxxxxx X. Xxxxxxx the right to vote the
Shares for the election of Directors at the Company's next annual meeting.
5. Representations and Warranties of Third Capital.
A. Organization, Power and Good Standing. Third Capital is a limited
liability company duly organized, validly existing and in good standing
under the laws of the State of Tennessee, and has all requisite power and
authority to carry on its business as now conducted.
B. Authority. Third Capital has all necessary power and authority,
corporate and otherwise, to make, execute and deliver this Agreement and
all other agreements and documents to be executed and delivered by it
pursuant to this Agreement; and Third Capital has taken all necessary
actions required to be taken to authorize it to execute and deliver this
Agreement and such other agreements, and to perform all of its obligations,
undertakings and agreements
to be observed and performed by it under this Agreement. This Agreement has
been duly executed and delivered by Third Capital, and constitutes the
valid and binding agreement of Third Capital enforceable against Third
Capital in accordance with its terms.
C. No Violation. The execution and delivery of this Agreement and the
consummation of the transaction contemplated by this Agreement will not
constitute a violation of, or be in conflict with, or result in a
cancellation of, or constitute a default under: (i) any term or provision
of the articles of organization or operating agreement (or other
organizational documents) of Third Capital; (ii) any judgment, decree,
order, regulation or rule of any court or governmental authority; (iii) any
statute or law; (iv) any contract, agreement, indenture, lease or other
commitment to which Third Capital is a party or by which it is bound; or
(v) cause any material change in the rights or obligations of any party
under any such contract, agreement, indenture, lease or commitment.
D. Material Facts. Representatives of Third Capital have disclosed to
representatives of the Fund all material facts regarding the Company, and
no such disclosure contains any untrue statement of a material fact or
omits to state a material fact necessary to make the statements therein not
misleading.
6. Representations and Warranties of the Fund.
A. Organization, Power and Good Standing. The Fund is a limited liability
company duly organized, validly existing and in good standing under the
laws of the State of Ohio, and has all requisite power and authority to
carry on its business as now conducted.
B. Authority. The Fund has all necessary power and authority, corporate and
otherwise, to make, execute and deliver this Agreement and all other
agreements and documents to be executed and delivered by it pursuant to
this Agreement; and the Fund has taken all necessary actions required to be
taken to authorize it to execute and deliver this Agreement and such other
agreements, and to perform all of its obligations, undertakings and
agreements to be observed and performed by it under this Agreement. This
Agreement has been duly executed and delivered by the Fund, and constitutes
the valid and binding agreement of the Fund enforceable against the Fund in
accordance with its terms.
C. No Violation. The execution and delivery of this Agreement and the
consummation of the transaction contemplated by this Agreement will not
constitute a violation of, or be in conflict with, or result in a
cancellation of, or constitute a default under: (i) any term or provision
of the articles of organization or operating agreement (or other
organizational documents) of Third Capital; (ii) any judgment, decree,
order, regulation or rule of any court or governmental authority; (iii) any
statute or law; (iv) any contract, agreement, indenture, lease or other
commitment to which Third Capital is a party or by which it is bound; or
(v) cause any material change in the rights or obligations of any party
under any such contract, agreement, indenture, lease or commitment.
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7. This agreement shall expire on the earlier of: (i) March 31, 1999, or
(ii) 120 days following the Company's next annual meeting at which a
minimum of 3 directors are elected to serve on the Company's Board of
Directors; provided that if by September 1, 1998, (i) Third Capital has not
filed a Schedule 14A regarding the election such directors with the
Securities and Exchange Commission, (ii) Third Capital has not commenced
legal proceedings to cause the Company to hold a meeting for the election
of directors, or (iii) as determined by the Fund in its sole discretion,
Third Capital has not taken substantial steps to require the Company to
hold a meeting for the election of such directors, the term of this option
shall expire automatically on September 1, 1998.
8. The parties agree that the normal rules of construction interpreting
documents against the drafter thereof shall not apply to this agreement
since both parties have been represented by legal counsel with respect to
the negotiation and drafting of this Agreement.
9. This Agreement will be binding upon and inure to the benefit of and be
enforceable by the respective heirs, legal representatives, successors and
permitted assigns of the parities hereto; provided, however, that none of
the rights or obligations of Third Capital may be assigned without the
prior written consent of the Fund, which consent may be withheld in the
Fund's sole discretion.
10. If any provision contained in this Agreement is invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of such provision in every other respect and of the
remaining provisions of the Agreement will not be in any way impaired.
11. This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, but all of which together will constitute
one and the same instrument.
12. This Agreement will be governed, construed and enforced in accordance with
the internal laws of the State of Ohio, excluding any choice of law rules
which may direct the application of the laws of another jurisdiction.
IN WITNESS WHEREOF, the parties hereto have executed this agreement as of the
date first above written.
THIRD CAPITAL:
Third Capital, LLC
By: /s/ X. X. Xxxxxxx
------------------------------
X. X. Xxxxxxx, Chief Manager
FUND:
Turkey Vulture Fund XIII, Ltd.
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxx, Manager
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