ANNULMENT AND AMENDING AGREEMENT
THIS ANNULMENT AND AMENDING AGREEMENT (the "Amending
Agreement") is made and entered into as of the 2nd day of May,
2003, by and between the following:
XXXXXXX X. XXXXXXXX, an individual, and XXXXXXXX XXXXX, an
individual; and
PARAMCO FINANCIAL GROUP, INC., a Delaware corporation.
W I T N E S S E T H
WHEREAS, the parties hereto entered into that certain
Purchase Agreement, dated as of January 31, 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
WOODLANDS S.A. FINANCIAL SERVICES, INC., a Texas corporation;
WHEREAS, in Section 4.4(b) of the Purchase Agreement,
Sellers represented and warranted to Paramco that:
Woodlands' 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 January 31, 2003 (the "January 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 May 20, 2003;
WHEREAS, Paramco and Sellers deem it desirable and in the
best interests of Paramco that the January Closing be annulled
and that the Purchase Agreement be amended to provide for a
closing date not later than August 28, 2003, 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:
PAGE -1-
SECTION 1
DEFINITIONS
1.1 "Amending Agreement", "Purchase Agreement", "Financial
Statements", and "January 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
January Closing is hereby annulled and, in accordance therewith,
(a) Sellers hereby tender to Paramco certificate nos. P/C-01 and
P/C-02, each representing 75,000 shares of Paramco's Series C
Convertible Preferred Stock, in a form enabling Paramco, then and
there, to cancel said shares, and (b) Paramco hereby tenders to
Sellers certificate no. 7, representing all of the issued and
outstanding capital stock (2,000 shares of common stock) of
Woodlands, 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,
August 28, 2003, at Denver, Colorado, the date on which
the parties hereto shall close the transactions
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. 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
not later than the Closing Date.
PAGE -2-
SECTION 3
REPRESENTATIONS AND WARRANTIES OF PARAMCO
Paramco, in order to induce each of Sellers to execute this
Amending Agreement and to consummate the transactions
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
Each of Sellers, jointly and severally, in order to induce
Paramco to execute this Amending Agreement and to consummate the
transactions contemplated herein, represents and warrants to
Paramco as follows:
4.1 Authorization and Validity. Each Seller has the
requisite power and is 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 Woodlands. From and after the January
Closing through and including the date hereof, Sellers have been
fully responsible for the management, directions, operations, and
planning in respect of Woodlands, and Sellers acknowledge that
Paramco has not made any representation or warranty as to the
status of Woodlands as of the date hereof or any change to such
status during the period from and after the January Closing
through and including the date hereof.
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 Woodlands 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.
PAGE -3-
SECTION 5
PRESS RELEASE
5.1 Press Release. Sellers acknowledge that Paramco shall
promptly 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 or May 1, 2005, whichever is longer.
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: Xxxxxxx X. Xxxxxxxx
Xxxxxxxx Xxxxx
0000 X.X. Xxxx 000
Xxxxx 000
Xxx Xxxxxxx, Xxxxx 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 address 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.
PAGE -4-
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.
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.
PAGE -5-
IN WITNESS WHEREOF, the parties hereto have executed this
Amending Agreement as of the day and year first above written.
PARAMCO FINANCIAL GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxx
---------------------------
Xxxxxxx X. Xxxxx
Chief Executive Officer
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------
XXXXXXX X. XXXXXXXX
/s/ Xxxxxxxx Xxxxx
--------------------------
XXXXXXXX XXXXX
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