AGREEMENT
This AGREEMENT (this "Agreement") is made as
of October 16, 1997 by and between THE AEGIS CONSUMER
FUNDING GROUP, INC. (the "Company"), III FINANCE
LTD. ("III") and THE HIGH RISK OPPORTUNITIES HUB
FUND LTD. ("Hub," and along with III the "Purchasers").
Capitalized terms used but not defined herein shall have the
respective meanings ascribed to them in the Indenture (as defined
below).
WHEREAS, Aegis Auto Finance, Inc. ("AAF")
and Norwest Bank Minnesota, National Association, as trustee,
have heretofore entered into an Indenture, dated as of April 30,
1997 (the "Indenture"), in connection with $21,333,333 principal
amount at maturity of AAF's 12% Exchangeable Subordinated
Notes due April 30, 2004 (the "Notes");
WHEREAS, the Purchasers purchased the Notes
pursuant to a Note Purchase Agreement dated as of April 30,
1997 by and among AAF, the Company and the Purchasers and
are the sole holders of the Notes;
WHEREAS, the Purchasers desire to exchange the
Notes held by them for shares of Class D Redeemable Preferred
Stock (the "Preferred Stock"), subject to the modifications
described in the Certificate of Amendment to Certificate of
Designation for the Preferred Stock set forth as Exhibit A hereto
(the "Certificate of Amendment"); and
WHEREAS, the Purchasers and the Company
desire to so modify the terms of the Preferred Stock;
NOW, THEREFORE, in consideration of the
foregoing premises and other good and valuable consideration,
the receipt of which is duly acknowledged, the parties hereto
hereby agree as follows:
1. The Company shall cause the Certificate of
Amendment as set forth in Exhibit A annexed hereto to be filed
with the Secretary of State of the State of Delaware.
2. Immediately upon filing of the Certificate
of Amendment with the Secretary of State of the State of
Delaware, the Purchasers shall exchange with the Company the
Notes held by such Purchasers, having an aggregate principal
amount at maturity of $21,333,333, for shares of Preferred Stock
having an aggregate Stated Value of $21,106,780, such exchange
to be evidenced by, among other things, the execution and
delivery of cross-receipts in the form annexed hereto as Exhibit
B and the deliveries contemplated thereby.
3. The Company agrees that it will resolve to
amend (the "Amendment") its Certificate of Incorporation, as
described below, and will thereafter use its best efforts to
obtain
the requisite approval of the Amendment by its stockholders (the
"Stockholder Approval") at a meeting of stockholders to be held
as soon as practicable after the date hereof, so that the Company
may cause the Amendment to be filed with the Secretary of State
of the State of Delaware and to become effective. It shall be a
condition to the effectiveness of this Agreement that ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, shall
have delivered to the Purchasers proxies, in the form annexed
hereto as Exhibit C, in favor of the Amendment. The Company
represents and warrants that the aggregate number of shares of
Common Stock (as hereinafter defined), covered by the foregoing
proxies represent approximately 36.4% of the outstanding shares
of Common Stock as of the date hereof. The Amendment shall
increase the authorized issuance of the common stock, par value
$.01 per share (the "Common Stock"), of the Company, so that
the Company shall have authorized a sufficient number of shares
of Common Stock to be able to effect a redemption of all shares
of Preferred Stock that are to be issued and outstanding upon the
consummation of this Agreement.
4. Within 5 days of obtaining Stockholder
Approval, the Company shall cause the Amendment to be filed
with the Secretary of State of the State of Delaware.
5. Subject to Sections 3 and 4 hereof, the
Company shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock solely for the
purpose of effecting the redemption of the Preferred Stock, such
number of shares of its Common Stock as shall from time to
time be sufficient to effect a redemption of all shares of
Preferred Stock that are issued and outstanding, and if at any
time the number of authorized but unissued shares of Common
Stock shall not be sufficient to effect the redemption of all
shares
of Preferred Stock outstanding, the Company shall promptly seek
such corporate action (including, without limitation, obtaining
any
requisite approval of its stockholders) as may be necessary to
increase its authorized but unissued shares of Common Stock to
such number of shares as shall be sufficient for such purpose.
In the event of the consolidation or merger of the Company with
another corporation where the Company is not the surviving
corporation, effective provisions shall be made in the
certificate
or articles of incorporation, merger or consolidation, or
otherwise, of the surviving corporation to reserve and keep
available sufficient number of shares of common stock or other
securities or property to provide for the redemption of the
Preferred Stock in accordance with the provisions of this Section
5.
6. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York
as applied to contracts made and to be performed within the
State of New York, including Section 5-1401 of the General
Obligations Law but otherwise without regard to principles of
conflict of laws.
7. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an
original, but all of which taken together shall constitute but
one
and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed, and their respective
corporate seals to be hereunto affixed and attested, all as of
the
day and year first above written.
THE AEGIS
CONSUMER FUNDING
GROUP, INC.
By:
Name:
Title:
III FINANCE LTD.
By:
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: Director
THE HIGH RISK
OPPORTUNITIES HUB
FUND LTD.
By:
Name: ▇▇▇▇▇
▇▇▇▇▇▇
Title: Director
F:\ATTORNEY\BOMRIND\AEGIS\AEGSNEW2.AGR
