HOMEGOLD FINANCIAL, INC.
VOTING AGREEMENT WITH ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
This VOTING AGREEMENT (this "Agreement") is made and entered into this
31st day of December, 2002 by and among HOMEGOLD FINANCIAL, INC., a South
Carolina corporation (the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (the
"Shareholder").
W I T N E S S E T H:
WHEREAS, the Shareholder is the principal shareholder of the Company
and owns approximately 35% of the outstanding shares of Common Stock of the
Company; and
WHEREAS, the Company as sole shareholder of HomeGold, Inc. ("HGI") has
been requested by the Shareholder to approve the sale of certain assets of the
retail mortgage loan division of HGI to an affiliate of the Shareholder pursuant
to the terms and conditions of that certain Amended and Restated Asset Purchase
Agreement dated as of the date hereof (the "Transaction"); and
WHEREAS, the Company is willing to approve the Transaction on the
condition that the Shareholder agree to certain provisions respecting his Common
Stock as set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and as an inducement to the Company to approve the Transaction, the
Shareholder agrees as follows:
DEFINITIONS
"Articles" means the Articles of Incorporation of the Company, as
amended, filed with the Office of the Secretary of State of South Carolina, on
the date of this Agreement.
"Board" means the Board of Directors of the Company.
"Common Stock" means the Common Stock, $.001 par value per share, of
the Company and any other stock of the Company entitled to vote along with the
Common Stock as a single class in the election of directors.
ARTICLE I
CORPORATE GOVERNANCE
1.1 Board Composition. The Shareholder agrees to vote his shares of
Common Stock for the size of the Board and the nominees as Directors recommended
by a majority of the then current members of the Board.
1.2 Other Shareholder Votes. The Shareholder agrees to vote his shares
of Common Stock on all matters presented to the shareholders of the Company as
recommended by a majority of the then current members of the Board.
1.3. Termination of Voting Agreement dated May 9, 2000. The Shareholder
hereby waives his rights under and agrees that the Voting Agreement among the
Company, the Shareholder, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and Sterling Family Limited
Partnership shall be terminated and have no further force or effect as of the
date hereof.
1.4 Further Assurances. The Shareholder shall vote all of his Common
Stock, shall execute and deliver such further documents, shall take such further
action, and shall use his best efforts to cause the Board to vote in such a
manner as may be necessary or desirable to carry out the purposes and intent of
this Agreement.
ARTICLE II
STOCK CERTIFICATES
Stock Certificates. The Shareholder agrees that the stock certificate
or certificates from time to time representing his shares of Common Stock shall
be registered in the individual name of such Holder and shall bear, in addition
to any other legend required to be placed thereon, a legend in substantially the
following form:
"THIS SECURITY IS SUBJECT TO THE TERMS OF THE VOTING AGREEMENT DATED DECEMBER
31, 2002, AND ANY AMENDMENTS THERETO, COPIES OF WHICH ARE ON FILE AT THE
PRINCIPAL OFFICE OF THE COMPANY. ANY ATTEMPTED SALE, PLEDGE, BEQUEST, TRANSFER,
ASSIGNMENT OR ANY OTHER DISPOSITION OR ENCUMBRANCE OF THIS SECURITY OTHERWISE
THAN AS EXPRESSLY PERMITTED BY SAID AGREEMENT IS INVALID."
ARTICLE III
TRANSFER RIGHTS AND RESTRICTIONS
General Restriction. The Shareholder may not sell, exchange, give,
devise, pledge, encumber or otherwise dispose of, either voluntarily or
involuntarily or by operation of law (including a transfer pursuant to equitable
distribution proceedings), any of the Common Stock, or any rights or interest
related thereto, whether now owned or hereafter acquired, unless (i) such
transfer will not jeopardize the net operating loss carry forward of the company
and (ii) the transferee shall have been approved by the Board, and until the
transferee has agreed, in a writing delivered to the Company, to be bound by all
of the terms and conditions of this Agreement.
ARTICLE IV
MISCELLANEOUS
4.1 Binding Effect. Subject to the limitations on transfer set forth
herein, this Agreement and all the provisions hereof shall be binding upon and
shall inure to the benefit of the Shareholder and his heirs, successors and
assigns.
4.2 Termination. This Agreement shall terminate and have no further
force or effect upon the earlier of (i) ten (10) years from the date hereof,
(ii) the written consent of the Company and the Shareholder, or (iii) the
completion of any distribution requirements of the Operating Agreement of Emmco,
LLC to holders of non-voting units of economic interest and to holders preferred
capital interests.
4.3 Governing Law. The interpretation, validity and performance of the
terms of this Agreement shall be governed by the laws of the State of South
Carolina, regardless of the law that might be applied under principles of
conflicts of law.
4.4 Notices. All communications under this Agreement shall be in
writing and (i) sent by facsimile transmission and by certified or registered
mail, return receipt requested, courier or overnight mail, or (ii) sent by
certified or registered mail, return receipt requested, courier or overnight
mail, (1) if to a Holder, to such address as such Holder may have furnished to
the other parties hereto in writing and (2) if to the Company then to the
following address or such other address as the Company may provide to the other
parties hereto by notice given in compliance with the provisions of this Section
4.4.
HomeGold Financial, Inc.
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▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Any written communication so addressed, sent by facsimile transmission or
certified or registered mail, return receipt requested, courier or overnight
mail, shall be deemed to have been given when sent via facsimile or mailed. All
other written communications shall be deemed to have been given upon receipt
thereof.
4.5 Headings. The section and other headings contained in this
Agreement are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
4.6 Counterparts. This Agreement may be executed and delivered in two
or more counterparts, each of which shall be deemed to be an original and all of
which together shall be deemed to be one and the same agreement.
4.7 Specific Performance. The parties hereto acknowledge that payment
of monetary damages may not be sufficient to adequately remedy a breach or
prospective breach of the terms and provisions of this Agreement and, therefore,
the parties hereto consent to the application of equitable remedies, including,
without limitation, specific performance, to enforce the terms and provisions of
this Agreement.
IN WITNESS WHEREOF, the Company and each of the Shareholder have
executed this Voting Agreement as of the date first above written.
HOMEGOLD FINANCIAL, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Title: CEO
SHAREHOLDER:
6,072,370 Shares of Common Stock /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (signature)
