CONVERTIBLE DEBENTURE SUBSCRIPTION AGREEMENT
THIS CONVERTIBLE DEBENTURE SUBSCRIPTION AGREEMENT IS EXECUTED IN RELIANCE
UPON THE EXEMPTION PROVIDED BY SECTION 4(2) ("SECTION 4(2)") FOR TRANSACTIONS
NOT INVOLVING ANY PUBLIC OFFERING UNDER THE SECURITIES ACT OF 1993, AS AMENDED
(THE "SECURITIES ACT").
THE SUBSCRIPTION AGREEMENT (this "Agreement") has been executed by the
undersigned in connection with the private placement of up to a maximum of
$3,000,000 in aggregate principal amount of 12% Convertible Debentures Due July
13, 200 1 (hereinafter referred to as the "Convertible Debentures"), of TRIM
FAST GROUP, INC., a corporation organized under the laws of the State of
Delaware, Nasdaq OTC Market Symbol "TRIM") (hereinafter referred to as the
"Company"). The Convertible Debentures being sold pursuant to this Agreement
have not been registered under the Securities Act. In addition to such other
terms as are set forth in this Agreement; (i) the terms on which the Convertible
Debentures may he converted into shares of Common Stock, $.00 1 par value, of
the Company (the "Common Stock") and the other terms of the Convertible
Debentures are set forth in the Form of Convertible Debentures attached hereto
as ANNEX I (the "Form of Convertible Debenture");(ii) the collateral provided as
additional security and as an incentive for Purchaser to purchase the
Convertible Debentures is set forth in attached ANNEX II; and, (iii) the
Security Agreement which grants Purchaser a secured interest in the Security is
attached hereto as ANNEX III The offer of the Convertible Debentures and, if
this Subscription Agreement is accepted by the Company, the sale of Convertible
Debentures is being made in reliance upon Rule 506 of Regulation D promulgated
under Section 4(2). (All dollar amounts in this Agreement are expressed in U.S.
Dollars.)
The undersigned Purchaser
Name: GRIBALT U.S., INC., a Colorado corporation
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Address: 0000 X. Xxxxxxxx, Xxx. 0000, Xxxxxxxxx X.X. X0X0X0
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If applicable, a corporation organized under the laws of Pennsylvania,
hereinafter referred to as "Purchaser") hereby represents and warrants to, and
agrees with the Company as follows:
1. AGREEMENT TO SUBSCRIBE
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A. Subscription. The undersigned Purchaser hereby irrevocab1y
(subject to Paragraph 9 hereof) subscribes to purchase Five Hundred Thousand
($5OO,OOO) in aggregate principal amount of Convertible Debentures, having a
purchase price of 1OO%.
B. Form of Payment. Purchaser shall pay the purchase price for the
Convertible Debentures by delivering good funds in United States Dollars in
accordance with Paragraph 1(c) below, to the escrow agent (the "Escrow Agent")
identified in the Escrow Instructions attached hereto (the "Escrow Agreement")
and marked as Annex IV. The Company shall deliver one or more certificates for
the Convertible Debentures to the Escrow Agent, and upon payment by the
Purchaser of the purchase price for the Convertible Debentures, the Escrow Agent
shall cause the Convertible Debentures purchased thereby by the Purchaser to be
delivered to the Purchaser as set forth in paragraph 1(c) below. By signing this
Agreement, the Purchaser and the Company each agrees to all of the terms and
conditions of, and becomes a part to, the Escrow Instructions attached hereto,
all of the provisions of which are incorporated herein by this reference as if
set forth in full at this point.
C. Method of Payment. Payment of the purchase price for the
Convertible Debentures shall be made by wire transfer of funds to:
Account Name: Xxxxxxxxx, Comden & Xxxxxxxxx, L.L.P. Trust Account
Bank: Manufactures Bank
Los Angeles Main Branch
l35 Xxxx 0xx Xxxxxx
Xxx Xxxxxxx, Xxxxx. 00000
Account No: 00-000-000
Bank ABA No: 000000000
No later than five (5) calendar days after the Company accepts this
Agreement and all other subscription agreements for the Convertible Debentures
and delivers a signed counterpart of this Agreement to the Purchaser and
delivers the certificate(s) for the Convertible Debentures to the Escrow Agents,
the Purchaser shall deliver the escrow funds to the Escrow Agent and the Company
shall deliver the certificates for the Convertible Debentures to the Purchaser
(the "Closing Date"). Such delivery to the Purchaser shall be by hand delivery
or by overnight courier to such address as the Purchaser may direct.
2. PURCHASER REPRESENTATIONS; ACCESS TO
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INFORMATION: INDEPENDENT INVESTIGATION
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A. Purchaser Representations and Warranties. Purchaser represents
and warrants to the Company as follows:
(a) Purchaser is either a "sophisticated purchaser" because
he has such knowledge and experience in financial and business matters that he
is capable of evaluating the merits and risks of the prospective investment or
an "accredited Investor" because he meets one of the following requirements:
(i) He is a natural person whose individual net worth,
or joint net worth with his spouse, exceeds $1,000,000,and either he is ab1e to
bear the economic risk of investment in the Convertible Debentures investment or
this investment does not exceed 10% of his net worth or joint net worth with his
spouse;
(ii) He is a natural person who had individual income in
excess of $200,000 in each of the two most recent years, or joint income with
that person's spouse in excess of $300,000 in each of those years and reasonably
expects to reach the same income level in the current year, and either he is
able to bear the economic risk of investment in the Convertible Debentures or
this investment does not exceed 10% of his net worth or joint net worth with his
spouse; or
(iii) It is an organization described in section 501
(c)(3) of the Internal Revenue Code of 1986, as amended (i.e., tax exempt
entities), corporation, Massachusetts or similar business trust, or partnership,
not formed for the specific purpose of acquiring Units, with total assets in
excess of $5,000,000;
(iv) It is a trust, with total assets in excess of
$5,000,000, not formed for the specific purpose of acquiring Convertible
Debentures, whose purchases are directed by a sophisticated person as described
under the first alternative under Category A above;
(v) It is bank as defined in Section 3(a)(2) of the
Securities Act, or a savings and loan association or other institution as
defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its
individual or fiduciary capacity; a broker or dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934; an insurance company as
defined in Section 2(13) of the Securities Act; or an investment company
registered under the Investment Partnership Act Of 1940 or a business
development company as defined in section 2(a)(48) of that Act;
(vi) It is a Small Business Investment Partnership
licensed by the U.S. Small Business Administration under Section 301(c) or (d)
of the Small Business Investment Act of 1958; a private business development
company as defined in section 202(a)(22) of the Investment Advisers Act of 1940;
an employee benefit plan within the meaning of Title I of the Employee
Retirement Income Security Act of 1974, if the investment decision is made by a
plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank,
savings and loan association, insurance company, or registered investment
adviser, or if the employee benefit plan has total assets in excess of
$5,000,000 or, if a self-directed plan, with investment decisions made solely by
persons that are accredited investors as described above;
(vii) He is a director or executive officer of the
Company; or,
(viii) It is an entity in which all of the equity owners
are Accredited Investors.
(b) Purchaser is sufficiently experienced in financial and
business matters to be capable of evaluating the merits and risks of its
investments, and to make an informed decision relating thereto, and to protect
its own interests in connection with the transaction.
(c) Purchaser is purchasing the Convertible Debentures for
its own account or for the account of beneficiaries for whom the Purchaser has
full investment discretion, each of which beneficiaries is bound to all of the
terms and provisions hereof including all representations and warranties herein.
Purchaser is purchasing the Convertible Debentures for investment purposes only
and, not with an intent towards further sale or distribution thereof, and has
not prearranged any sale with any other purchaser.
(d) The Convertible Debentures have not been registered under
the Securities Act and may not be transferred, sold, assigned, hypothecated or
otherwise disposed of unless such transaction is the subject of a registration
statement filed with and declared effective by the Securities and Exchange
Commission (the "SEC") or unless an exemption from the registration requirements
under the Securities Act such as Rule 144 is available. Purchaser represents and
warrants and hereby agrees that all offers and sales of the Convertible
Debentures and the Common Stock issuable upon conversion thereof (collectively,
the "Securities") shall be made only pursuant to such registration or to such
exemption from registration which exemption the Company may require an opinion
letter from counsel which demonstrates the availability of the exemption from
registration before the Company will recognize any transfer of the Securities.
(e) Purchaser acknowledges that the purchase of the
Securities involves a high degree of risk, is aware of the risks and further
acknowledges that it can bear the economic risk of the Securities, including the
total loss of its investment.
(f) Purchaser understands that the Securities are being
offered and sold to it in reliance on an exemption from the registration
requirements of the Securities Act, and that the Company is relying upon truth
and accuracy of the representations, warranties, agreements, acknowledgments and
understanding of Purchaser set forth herein in order to determine the
applicability of such safe harbor and the suitability of Purchaser to acquire
the Securities.
(g) Purchaser is purchasing the Securities for its own
account or for the account of beneficiaries for whom Purchaser has full
investment discretion and not with a view to, or for sale in connection with,
any "distribution" (as such term is used in Section 2(11) of the Securities Act)
thereof.
(h) In evaluating its investment, Purchaser has consulted its
own investment and/or legal and/or tax advisors.
(i) Purchaser is not an underwriter or dealer in, the
Securities, Purchaser is not participating, pursuant to a contractual agreement,
in the distribution of the Securities.
B. Current Public Information. Purchaser acknowledges that
Purchaser has been furnished with or has acquired copies of the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1999 filed with the
Securities and Exchange Commission and the Forms 1O-QSB and 8-K filled
thereafter (collectively the "SEC Fillings").
C. Independent Investigation; Access. Purchaser acknowledges that
Purchaser, in making the decision to purchase the Convertible Debentures
subscribed for, has relied upon independent investigation made by it and its
purchaser representatives, if any,
and Purchaser and such representatives, if any, have prior to any sale to it,
been given access and the opportunity to examine all material contracts and
documents relating to this offering and an opportunity to ask questions of, and
to receive answers from, the Company or any person acting on its behalf
concerning the terms and conditions of this offering. Purchaser and its
advisors, if any, have been furnished with access to all publicly available
materials relating to the business, finances and operation of the Company and
materials relating to the offer and sale of the Securities which have been
requested. Purchaser and its advisors if any, have received complete and
satisfactory answers to any such inquiries.
D. No Government Recommendation or Approval. Purchaser understands
that no federal or state agency has passed on or made any recommendations or
endorsement of the Convertible Debentures.
E. Entity Purchasers. If Purchaser is a partnership, corporation
or trust, the person executing this Agreement on its behalf represents and
warrants that:
(a) He or she has made due inquiry to determine the
truthfulness of the representations and warranties made pursuant to this
Agreement.
(b) He or she is duly authorized (if the undersigned is a
trust, by the trust agreement) to make this investment and to enter into and
execute this Agreement on behalf of such entity.
(c) The entity was not formed for the purpose of investing in
the offered securities.
(d) In the case of a partnership, each person in the
partnership is an "accredited investor" or a "sophisticated purchaser" as
required for each Purchaser under Section 2(a)(i).
F. Non-Affiliate. Purchaser represents, warrants and covenants
that it is not affiliate of the Company.
3. ISSUER REPRESENTATIONS
-----------------------
A. Reporting Company Status. The Company is a "Reporting Issuer"
under the Exchange Act of 1934, as amended (the "Exchange Act"). The Company is
in full compliance, to the extent applicable, with all reporting obligations
under either Section 12(b), 12(g) 13(a) or 15(d) of the Exchange Act. The
Company has registered its Common Stock pursuant to Section 12(g) of the
Exchange Act, and the Common Stock is listed on the Nasdaq OTC Market, and the
Company has received no adverse notice, either oral or written, with respect to
its continued eligibility for such listing. The Company will take all such steps
as may be necessary for the additional listing of the Common Stock issuable upon
conversion of the Convertible Debentures on the Nasdaq OTC Market. The Company
has filed all materials required to be filed by it pursuant to all applicable
reporting obligations under Section 13(a) or 15(d) of the Exchange Act.
B. Terms of Convertible Debentures. The terms of the Convertible
Debentures shall be as set forth in the Form of Convertible Debenture delivered
to Purchaser as Annex I.
C. Legality. The Company has the requisite corporate power and
authority to enter into this Agreement and to issue, sell and deliver the
Securities; this Agreement and the issuance, sale and delivery of the Securities
hereunder and the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action by the Company; this Agreement and
the Securities have duly and validly executed and delivered by and on behalf of
the Company, and are valid and binding agreements of the Company, enforceable in
accordance with their respective terms, except as enforceability may be limited
by general equitable principles, bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, or other laws affecting creditors' rights generally.
The Convertible Debentures and common stock issueable upon conversion of the
convertible debentures will not subject the holders thereof to personal
liability by reason of being such holders.
D. Proper Organization. The company is a corporation duly
organized, validly existing and in good standing under the 1aws of its
jurisdiction of incorporation and is duly qualified as a foreign corporation in
all jurisdictions where the failure to be so qualified would have a materially
adverse effect on its business, taken as whole.
E. No Lega1 Proceedings. There is no action, suit or proceeding
before or by any court or any governmental agency or body, domestic or foreign,
now pending or, to the knowledge of the Company, threatened, against or
affecting the Company, or any of its properties or assets, which might result in
any material adverse change in the condition (financial or otherwise) or in the
earnings, business affairs or business prospects of the Company, or which might
materially and adverse1y affect the properties or assets thereof, except as
described in the SEC Filings.
F. Non-Default. The Company, except as described in the SEC
Filings, is not in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust or other material instrument or agreement to which it is
a party or by which it or its property may be bound.
G. No Misleading Statements. None of the SEC Filings, and as of
their respective dates, none of the Company's other filings with the SEC contain
any knowingly untrue statement of a material fact or known omission to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
H. No Adverse Change. There has been no material adverse change in
the financial condition, earnings, business affairs or business prospects of the
Company since the date of the Company's most recent Form 00-XXX xx 00-XXXX filed
pursuant to the Exchange Act.
I. Absence of Non-Disclosed Facts. There is no fact known to the
Company (other than general economic conditions known to the pub1ic generally)
that has not been disclosed in writing to the Purchaser that: (i)could
reasonably be expected to have a material adverse effect on the condition
(financial or otherwise)or in the earnings, business affairs, business
prospects, properties or assets of the Company; or (ii) could reasonably be
expected to materially and adversely affect the ability of the Company to
perform its obligations pursuant to this Agreement and the Convertible
Debentures, except as described in the SEC Filings.
J. Registration Transfer Restrictions. The Company has provided
its Transfer Agent with irrevocab1e instructions as attached here to as Annex V
(the "Irrevocab1e Instructions"), to issue one or more certificate(s)
representing the shares of Common Stock
to the holders of the Convertible Debentures upon the conversion of the
Convertible Debentures at any time after the Closing Date without any
restrictive legend or stop transfer instructions and without any further
instruction or opinion from the Company, provided that the Company is presented
with certificates representing shares of the Convertible Debentures to be
converted, together with an executed Conversion Certificate in the form of
Exhibit A attached to the Form of Convertible Debenture, and provided further
that the Common Stock is being sold pursuant to the registration statement on
Form S-2 or such other registration as set forth below. Upon compliance with the
foregoing upon issuance, such Common Stock shall be freely transferable on the
books and records of the Company.
No later than 45 days after the Closing Date, the Company shall
fi1e a registration statement on Form S-2 under the Securities Act and under all
applicab1e Blue Sky laws covering the Common Stock and shall have such
registration statement to be declared effective within 120 days of the Closing
Date, by the SEC, all at the Company's sole cost and expense. Company promptly
responding to all comments received by the SEC staff, upon written request
providing Purchaser or its counsel with contemporaneous copies of all written
communications from the SEC staff and promptly preparing and filing amendments
to such registration statement which are responsive to the comments received
from the SEC staff. Such registration statement shall name Purchaser as a
selling shareholder and shall provide for the sale of the Common Stock by
Purchaser from time to time directly to purchasers or in the over-the-counter
market through or to securities brokers or dealers that may receive compensation
in the form of discounts, concessions, or commissions. This obligation to
register the Common Stock is in addition to the Company's registration
obligation described in Section 10 hereunder. None of the foregoing shall in any
way limit Purchaser's rights to sell the Common Stuck issuable upon conversion
of the Convertible
Debentures in reliance on an exemption from the registration requirements under
the Securities Act in connection with a particular transaction.
In the event that the Company fails to register the resale of the
Common Stock issuable upon conversion of the Convertible Debentures within 120
days after the Closing Date, the Company will, upon the presentation of a
reasonably acceptable opinion of the Purchaser's counsel allow the Purchaser to
offer and sell the shares of Common Stock in reliance on the provisions of Rule
144 provided that the holding period and other requirements of such Rule 144 are
met. In the event the Company either (a) fails to file a registration statement
covering the Common Stock issuable upon conversion of the Convertible
Debentures, within 45 days of the first Closing Date or (b) fails to have such
registration statement declared effective by the Securities and Exchange
Commission within 120 days of the first Closing Date, Company shall
automatically be subjected to the penalties set forth in attached Annex I.
Regardless of whether the Company registers the resale of the
Common Stock issuable upon conversion of the Convertible Debentures, the Company
will, upon the presentation of an opinion of the Purchaser's counsel, allow the
Purchaser to offer and sell the shares of Common Stock in reliance on the
provisions of Rule 144, at the option of Purchaser.
K. Non-Contravention. The execution and delivery of this Agreement
and the consummation of the issuance of the Securities and the transactions
contemplated by this Agreement do not and wi11 not conflict with or result in a
breach by the Company of any of the terms or provisions of, or constitute a
default under the Articles of Incorporation or bylaws of the Company, or any
indenture, mortgage, deed of trust, or other material agreement or instrument
to which the Company is a party or by which it or any of its properties or
assets are bound, or any existing applicable Federal or State law, rule, or
regulation or any applicable decrees, judgment or order of any court, Federal or
State regulatory body, administrative agency or other domestic governmental
body having jurisdiction over the Company or any of its properties or assets.
L. Fillings. The Company undertakes and agrees pursuant to the
sale of its Securities hereunder to make all necessary filings in connection
with the sale of its Securities as required by the laws and regulations of all
appropriate jurisdictions and securities exchanges in the United States, if any.
4. COVENANTS OF THE COMPANY. For so long as any Convertib1e
---------------------------
Debentures held by the Purchaser shall remain outstanding, the Company covenants
and agrees with the Purchaser that:
A. It will at all times fully reserve from its authorized but
unissued shares of Common Stock such sufficient number of shares of Common Stock
to permit the conversion in full of the outstanding Convertib1e Debentures.
B. Upon receipt by the Company of confirmation of effectiveness of
the Registration Statement as provided in Section 10 the Company will not issue
stop transfer
instructions to its Transfer Agent with respect to, and will not place a
restrictive legend on, the certificates representing shares of Common Stock
issued or issuable upon conversion of the Convertible Debentures.
5. LEGEND
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A. On or prior to the Closing Date, the Company will prepare and
issue one or more certificates for the Convertib1e Debentures registered in such
name or names as specified by the Purchaser and cause the same to be delivered
to the Escrow Agent. Such certificate(s) and the certificates representing the
Common Stock shall bear a legend in substantially the following form:
These securities have been issued pursuant to the Section
4(2) exemption to the registration provisions under the
Securities Act of 1933, as amended. These securities cannot
be transferred, offered, or sold unless the securities are
registered under the Securities Act or an exemption from the
registration requirements of the Securities Act is available.
The Company has provided its Transfer Agent with the Irrevocable
Instructions and pursuant thereto the Company shall issue one or more
certificates representing shares of Common Stock upon the conversion of the
Convertible Debentures in accordance with the Form of Convertible Debentures.
The Company warrants that upon registration of the Common Stock
to be provided upon any conversion of the Convertible Debentures, no restriction
or instruction other than the foregoing instructions and a corresponding "stop
transfer" restriction on the Company's stock ledger will be imposed by the
Company or given by the Company to its Transfer Agent with respect to the Common
Stock and that, subject to the foregoing, the Common Stock issued and issuable
upon conversion of the Convertible Debentures shall otherwise be freely
transferable on the books and records of the Company. Nothing in this Section
shall affect in any way the Purchaser's obligations and agreement to comply with
all applicable securities laws upon resale of the Securities.
B. The Purchaser acknowledges that the Company is under no
obligation to register the Convertible Debentures or the Common Stock issuable
upon the conversion thereof under the Securities Act other than as set forth in
Section 10 or Section 3(j) hereunder.
6. EXEMPTION: RELIANCE ON SECTION 4(2). Purchaser understands that
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the offer and sale of the Convertible Debentures is not being registered under
the Securities Act based on the exemption from registration provided by Rule 506
promulgated under Section 4(2) of the Securities Act. The Company is relying on
such exemption.
7. CLOSING DATE AND ESCROW AGENT. Closing shall be effected through
---------------------------------
delivery of funds to the Company by the Escrow Agent, and delivery of
certificates evidencing the Convertible Debentures to the Purchaser by the
Escrow Agent. Each of the Company and the Purchaser agrees that the Escrow Agent
has no liability as a result of any fraudulent or unlawful conduct of any other
party, and agrees to held the Escrow Agent harmless except as to any loss,
claim, damage or liability arising out of or is based upon any action not taken
in good faith, on any action or omission that constitutes gross negligence or
willful misconduct by the Escrow Agent
8. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL. Purchaser
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understands that the Company's obligation to sell the Convertible Debentures is
conditioned upon:
A. The receipt and acceptance by the Company of this Agreement, as
evidence by execution of this Agreement by the President or any Vice President
or the Chief Financial Officer of the Company; and
B. Delivery to the Escrow Agent by Purchaser of good funds as
payment in full for the purchase of the Convertible Debentures; and
C. The accuracy as of the Closing Date of the representations and
warranties of the Purchaser contained in this Agreement, and performance by the
Purchaser of all covenants and agreements of the Purchaser required to be
performed on or before the Closing Date.
9. CONDITIONS TO PURCHASER'S OBLIGATION TO PURCHASE. The Company
-----------------------------------------------------
understands that Purchaser's obligation to purchase the Convertible Debentures
is conditioned upon:
A. Execution by Purchaser of this Agreement and the receipt of the
Company's acceptance of this Agreement as provided in Paragraph 3(a) above; and
B. Delivery of certificates evidencing the Convertible Debentures
to the Escrow Agent, as heretofore set forth, and by the Escrow Agent to
Purchaser; and
C. Acceptance by the Company of subscriptions from the Purchaser
and other subscribers and the sale by the Company pursuant thereto of a maximum
of $3,000,000 in principal amount of Convertible Debentures; and
D. The accuracy as of the Closing Date of the representations and
warranties of the Company contained in this Agreement and the performance by the
Company on or before the Closing Date of all covenants and agreement of the
Company required to be performed on or before the Closing Data.
10. REGISTRATION OF THE SECURITIES. In the event that the shares of
---------------------------------
Common Stock issuable upon conversion of the Convertible Debentures are not
subject to an effective Registration Statement on Form S-2 filed under the
Securities Act, the Company shall promptly and expeditiously file within 45 days
of the Closing Date, and cause to become effective within 120 days of the
Closing Date, a registration statement on Form S-2 under the Securities Act and
all applicable Blue Sky Laws covering the sale of the Common Stock. The Company
shall promptly respond to all comments received by the SEC staff upon written
request, providing Purchaser or its counsel on request with contemporaneous
copies of all written communications from SEC staff and promptly prepare and
file amendments to such registration statement which are responsive to the
comments received from the SEC staff. Any such registration statement shall name
Purchaser as a selling shareholder and shall provide from the sale of the Common
Stock from time to time directly to purchasers in the over-the-counter market,
or through or to securities broker-dealers that may receive compensation in the
form of discounts, concessions, or commissions. Any such registration statement
shall remain effective for up to 12 months or until all of the Common Stock,
whichever is earlier. The Company shall provide the Purchaser with such number
of copies of the prospectus as shall be reasonably requested to facilitate the
sale of the Common Stock. The Company shall bear and pay all expenses incurred
in connection with any such registration, excluding discounts and commissions.
The foregoing shall not in any way limit Purchaser's rights in connection with
the Common Stock from selling such Common Stock (i) pursuant to Rule 144 or (ii)
pursuant to any other exemption from registration under the Securities Act.
11. GOVERNING LAW. This Agreement shall be governed by and construed
--------------
under the laws of the State of Pennsylvania without regard to its choice of law
provision. A facsimile transmission of this signed Agreement shall be legal and
binding on all parties hereto.
12. SURVIVAL OF REPRESENTATIONS, WARRANTIES, AND COVENANTS.
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Each of the Company's and Purchaser's representations, warranties, and covenants
shall survive the execution and delivery of this Agreement and the delivery of
the certificates representing the Securities.
13. SUCCESSORS AND ASSIGNS. This Agreement shall inure the benefit of and be
-------------------------
binding on the respective successors and assigns of the parties hereto.
(BALANCE OF PAGE INTENTIONALLY LEFT BLANK)
SIGNATURE PAGE FOR ENTITIES
IN WITNESS WHEREOF, the undersigned represents that the foregoing statements are
true and that it has caused this Subscription Agreement to be duly executed on
its behalf on this 25th day of April, 2000.
GIBRALT U.S., INC., a Colorado corp.
---------------------------------------------
Printed Name of Subscriber
By: /s/ J Xxxxxx
---------------------------------------------
(Signature of Authorized Person)
Xxxx Xxxxxx - Treasurer
---------------------------------------------
(Printed Name and Title)
Accepted this 25th day of April, 2000:
TRIM FAST GROUP, INC.
By: Xxxxxxx Xxxxx
---------------
Title: C.E.O.
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Full Name and address of Purchaser for Registration Purposes:
NAME: GIBRALT U.S., INC. a Colorado corporation
ADDRESS: 0000 X. Xxxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxxxx, X.X. X0X0X0
TEL. NO. (000) 000-0000
FAX NO. (000) 000-0000
CONTACT NAME: Xxxx Xxxxxx
Delivery Instructions (if different form Registration Name):
NAME:
ADDRESS:
TEL. NO.:
FAX NO.:
CONTACT NAME:
INTERCREDITOR AGREEMENT
This Intercreditor Agreement is entered into by and between FAC
ENTERPRISES, INC. a Pennsylvania corporation ("FAC") and GRIBALT U.S., INC., a
Colorado corporation, ("GRIBALT") (collectively the "Purchasers"), with respect
to the following.
RECITALS
A. Purchasers have individually entered into a Convertible Debenture
Subscription Agreement (the "Convertible Debenture") of even date
herewith with TRIMFAST GROUP, INC., a Delaware corporation
(hereinafter the "Company").
B. As part of the Convertible Debenture, the Company granted the
PURCHASERS a security interest in certain real property and in
Five Hundred Thousand Shares (500,000) of common stock in Insider
Xxxxxx.xxx (collectively the "Security"), pursuant to a Security
Agreement of even date herewith (the Security Agreement").
C. Purchases wish to provide for their joint and equal protection,
in xxxx xxxxx, amongst each other with regard to the Security in
the event of a breach of or default under the Security Agreement,
or other related agreements, by the Company.
D. If, and only, the Company commits a breach of or a default under
the Convertible Debenture, the Security Agreement, or any other
contract or agreement executed by the Company with regard to the
transactions contemplated by the Convertible Debenture, each of
the Purchasers will have a mutual interest in the Security
granted to them pursuant to the Convertible Debenture and the
Security Agreement and they wish to enter into this agreement to
clarify their rights and obligation in the event of a such a
default.
NOW THEREFORE, in consideration of the mutual promises contained
herein, the parties agree as follows:
1. The Recitals are incorporated herein the same as if set
forth at this point.
2. If the Company fails to perform all of its obligation under
the Convertible Debenture, including all related contract
and agreements (all of which are collectively referred to as
the "Convertible Debenture"), or is otherwise in breach of
or default under the Convertible Debenture, then and one of
the Purchasers may declare that the Company is in breach and
/or default and shell immediately advise other party of said
default pursuant to the notice provision of this
Intercreditor Agreement.
3. Thereafter, any Purchaser may foreclose on the Security, the
proceeds of which shall be divided among the Purchasers in
direct proportion to their respective percentage ownership
of, /investment in purchase of the Convertible Debenture,
broken down to the nearest one hundredth of a point
percentage rate regardless of which of them may be in first
position pursuant to a any UCC filing, deed of trust or
other instrument which may provide one of the Purchasers a
priority over the others with respect to the Security. The
foreclosing party(ies) shall be a trustee on behalf of the
nonforeclosing party(ies) for the purpose of holding the
nonforeclosing party's(ies) interest in the collateral in
trust and thereafter distributing the property together with
an accounting to the nonforeclosing party.
4. If any Purchaser brings any legal action regarding any
provision of this Agreement, the prevailing party in the
litigation or arbitration shall be entitled to recover
reasonable attorney's fees and costs from the other party,
in addition to any other relief that may be granted.
5. Any notice required or permitted to be given under this
agreement shall be written, and may be given by personal
delivery or by registered or certified mail, first-class
postage prepaid, return receipt requested. Notice shall be
deemed given upon actual receipt in the case of personal
delivery, or if mailed upon mailing. Mailed notices shall be
addressed as follows, but each part may change his address
by written notice in accordance with paragraph:
If to FAC:
FAC ENTERPRISES, INC., a Pennsylvania corporation
GSB Building
0 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxxxx 00000
Telephone (000) 000-0000
Fax No.: (000) 000-0000
With a copy to:
L. Xxxxxxx Xxxxxxxx, Esq.
XXXXXXXXX COMDEN & XXXXXXXXX
0000 Xxxxxx Xxxx. Xxx. 000
Xxxxxxx, XX. 00000
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
If to GIBRALT:
GIBRALT U.S., INC., a Colorado corporation
Xxxxx 0000
0000 X. Xxxxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X0X0
Attention: Xxxx Xxxxxx
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
6. Neither party assign this Agreement without the prior
written consent of all the other parties.
7. This agreement shall be binding on and shall inure to the
benefit of the heirs, executors, administrators, successors,
and assigns of each of the parties hereto.
8. This agreement shall be governed by and construes in
accordance with the laws of California.
Dated:_________, 2000 FAC ENTERPRISES, INC., a corporation
By: /s/ Xxxxxx Xxxxx
----------------------------------------
Name: Xxxxxx Xxxxx
--------------------------------------
Title: President
-------------------------------------
And
By:_____________________________
Name:__________________________
Title:____________________________
Dated: April_____, 2000 GIBRALT U.S., INC., a Colorado corporation
By: /s/ X. Xxxxxx
----------------------------------------
Name: Xxxx Xxxxxx
--------------------------------------
Title: Treasurer
-------------------------------------
And By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
PLEDGE AND SECURITY AGREEMENT
This PLEDGE AND SECURITY AGREEMENT ("Security Agreement") is made this____ day
of April, 2000, by, between and among TRIM FAST GROUP, INC., a Nevada
corporation(the "Company", "Debtor" or "Pledgor"), on the one hand, and FAC
ENTERPRISES, INC. a corporation ("FAC") and GIBRALT U.S., INC., a Colorado
corporation ("GIBRALT") (FAC and GIBRALT are collectively hereinafter referred
to as "Secured Party" or "Secured Parties"), on the other hand, with respect to
the following.
RECITALS
A. concurrently herewith, Company sold and issued to the Secured Parties,
and the Secured Parties, as Purchaser, purchased from the Company
twelve percent (12%) Convertible Debentures ("Convertible
Debentures").
B. In order to induce the Secured Parties to purchase the convertible
Debentures, the Company desires and wishes to grant to the Purchasers
a secures interest in the real property described in Exhibit "A" and
the personal property described in attached Exhibit "B", both of which
are attached hereto and incorporated herein by this reference.
C. Debtor and Secures Parties now mutually desire Debtor to secure the
obligations under the Convertible Debenture to Secured Parties, which
obligation are evidence by the Convertible Debenture and this Security
Agreement (the "Obligation") in a principal amount of up to Three
Million Dollars ($3,000,000) and for Debtor to pledge the personal
property listed on attached Exhibits "A" and "B" as
security/collateral for the payments due under the Convertible
Debenture and to secure the performance of the Company under the
Convertible Debenture (the "Security") on the terms and conditions set
forth herein.
NOW, THEREFORE, in consideration of and reliance on the mutual convenants,
conditions, promises and representations contained herein, the parties hereto
agree as
follows:
1. Recitals. The recitals stated above are incorporated herein by this
--------
reference as if set forth in full.
2. Definitions. As used in this Security Agreement, the following terms
-----------
shall have the following meanings:
2.1 "Collateral" and "Security" mean the personal property set forth
and fully described on Exhibit "A" attached hereto.
2.2 "Debtor" or "Pledgor" shall mean the Company.
2.3 "Convertible Debenture" shall mean the Company's obligation
represented by the Convertible Debenture Subscription Agreement
and all documents and agreement related thereto and executed as a
part thereof.
2.4 "Lien" means any security interest, mortgage, pledge, lien,
attachment, claim, charge, encumbrance, agreement retaining
title, or other interests in, to or covering the Security.
2.5 "Obligation" mean any and all existing and future duties,
obligation, indebtedness and liabilities of the Company to
Secured Parties, including attorneys' fees, incurred in enforcing
this Security Agreement or collection payment due under the
Convertible Debenture.
2.6 "Breach" and "Default" mean an event or omission that is or would
be a breach or default under this Security Agreement or any other
document evidencing, creating or relating to the security for and
performance of the Obligations.
2.7 Terms defined in the California Uniform Commercial Code not
otherwise defined in this Security Agreement are used in this
Security Agreement as defined in that Code on the date of this
Security Agreement.
3. Grant of Security Interest and Pledge of Collateral. For the purpose
----------------------------------------------------
of providing Secured Parties with security for the Company's
performance under the Convertible Debenture, then the Company hereby
grants to Secured Parties a security interest in and to the Security,
which is more specifically described and set forth in attached
Exhibits "A" and "B" and which are incorporated herein by this
reference, and pledges one hundred percent (100%) of their interests
in and to Security to Secured Parties. Further, Debtor shall execute
any and all other documents necessary to grant, perfect and otherwise
effect notice that Secured Parties have a security interest also grant
Secured Parties the full power of attorney to sign such documents on
behalf of the Debtor in the event any of the Debtor is unable to or
refuse to sign such documents.
With regard to the stock pledged as Security, the Debtor pledges
all its right, title and interest in and to the stock to Secured
Parties, without any exception, qualification or reservation.
Debtor acknowledges that it is pledging the stock as security for
the Convertible Debenture and that upon any default or breach by
the Company of the Convertible Debenture or any of the related
agreements, the Secured Parties shall have the right and option
to foreclose upon the stock and assume ownership and control of
same.
Debtor also grants the Secured Parties the right and power to
endorse to stock certificates on behalf of and in their
respective names and to transfer ownership there of in the event
of a default which is not cured as provide herein.
4. Debtor's Convenants.
---------------------
Debtor shall"
4.1 Perform all promises and obligations owed by them to the Secured
Parties;
4.2 Pay all expenses, including attorney's fees, incurred by Secured
Parties in the perfection, preservation, realization, enforcement and
exercise of its rights under this Security Agreement;
4.3 Indemnify Secured parties against loss of any kind, including
reasonable attorney's fees, caused to Secured Parties by reason of its
interest in the Security;
4.4 Not sell, lease, transfer, or otherwise dispose of or hypothecate the
Security, without the express prior written consent of the Secured
Parties, which consent may be withheld or granted by Secured Parties
at their sole discretion;
4.5 Not permit any liens on the Security, except the lien by this Security
Agreement;
4.6 Not use the Security for any purpose or in any way that would void any
effective insurance;
4.7 Perform all acts necessary to maintain, preserve, and protect the
Security;
4.8 Notify Secured Parties promptly in writing of any default, potential
default, or any development that might have a material adverse effect
on the Security: and ,
4.9 Not issue any stock, stock rights, options , or other interest in the
Security which would have the effect of diluting the shares of common
stock pledged to Secured Parties as part of the Security.
5. Debtor's Representations and Warranties. Debtor covenants,
---------------------------------------------
warrants and represents as follows"
5.1 Debtor has the full capacity to understand and enter into this
Security Agreement and posses all the necessary authority and
power to conduct its business in the fashion now conducted and as
contemplated herein, wherever conducted;
5.2 The Security Agreement is a valid and binding obligation of
Debtor. This Security Agreement creates a perfected, first
priority security interest enforceable against the Security in
which Debtor's rights will be effected as this Security
Agreement, and creates a perfected, first priority interest for
the benefit of Secured Parties, which is enforceable against the
Security;
5.3 No default or potential default exists; and,
5.4 Debtor owns the Security, subject only to real property tax liens
placed against the real property for taxes which are not yet due.
No delinquent taxes or assessments are due. The shares of stock
are free and clear of any and all liens and encumbrances and are
not subject to any other agreement or arrangement effecting them,
they are fully paid, non-assessable and non-redeemable.
6. Termination. This Security Agreement shall continue in effect even
-----------
though from time-to-time there may be no outstanding obligation or
commitments under this Security Agreement and/or the NOTE. This
Security Agreement shall terminate when (a) Debtor completes
performance of all obligations to Secured Parties, including without
limitation the satisfaction of the Convertible Debenture.
7. Default. Debtor shall be in default under this Security Agreement
--------
("Event of Default") if:
7.1 The Company fails to perform under the Convertible Debenture;
7.2 The Company commits any breach of this Security Agreement, or any
future amendment to this Security Agreement, or any other
agreement between Debtor and Secured Parties: or,
7.3 Any warranty, representation or statement made by or on behalf of
Debtor in or with respect to the Security Agreement, is false.
8. Remedies.
---------
8.1 Upon an Event of Default, Secured Parties may, at its sole
option:
(a) Declare the Obligations immediately due and payable without
demand, presentment, protest or notice to Debtor;
(b) Terminate any obligations or to make advances, if any;
(c) Exercise all rights and remedies available to a secured creditor
after default, including but not limited to the rights of secured
creditors under the Uniform Commercial Code (the "UCC");
(d) Perform any of Debtor's Obligations under this Security Agreement
for Debtor's account; or,
(e) Take possession of the Security in satisfaction of the
Obligations and sell same in accordance with the public sale
provisions of the UCC.
8.2 upon notice of an Event of Default by the Secured Parties, Debtor
shall:
(a) Assemble the Security and make it and all records relating to it
available to Secured Parties as Secured Parties directs: and,
(b) Allow Secured parties, its representatives, and its agents to
enter the premises where all or any part of the Security, the
records, or both may be, and remove any or all of it.
9. Assignment. This Security Agreement shall bind and enure to the
-----------
benefit of the parties successors, heirs and assigns. However, Debtor
may not assign its rights, duties and obligation under this Security
Agreement or the Convertible Debenture without Secured Parties' prior
written consent. However, the Secured Parties has the unrestricted
right to assign its rights in and to the Convertible Debenture and
this Security Agreement, in whole and in part, at any time.
10. Notices. Any communication to be given to any party to this Security
--------
Agreement shall be in writing and delivered as provided in the
AGREEMENT.
11. Binding Effect. The parties hereto hereby represent and warrant, each
---------------
for themselves, that they have the capacity to and are authorized to
enter into this Security Agreement on behalf of their respective party
and that this Security Agreement, when duly executed, will constitute
a legal, valid, and binding agreement, enforceable against each of the
parties in accordance with the terms hereof.
12. Severability. In the event that any covenant, condition or other
------------
provision herein contained is held to be invalid, void, or illegal by
any court of competent jurisdiction, the same shall b deemed severable
from the remainder of this Security Agreement and shall in no way
affect, impair or invalidate any other covenant, condition or other
provision herein contained. If such condition, covenant or other
provision shall be deemed invalid due to its scope or breadth, such
covenant, condition, or other provision shall be deemed valid to the
extent of the scope or breadth permitted by law.
13. Waiver, Amendment and Modification, No breach of any provision hereof
------------------------------------
can be waived unless in writing. Waiver of any one breach of any
provision hereof shall not be deemed to be a waiver of any other
breach of the same or any other provision hereof. This Security
Agreement may only be amended or modified by an instrument in writing
executed by each of the parties hereto.
14. Construction. This Security Agreement shall not be construed against
-------------
the party preparing it, and shall be construes without regard to the
identity of the person who drafted it or the party who caused it to be
drafted and shall be construed as if all parties had jointly prepared
this Security Agreement and it shall be deemed their joint work
produce, and each and every provision of this Security Agreement shall
be construed as though all of the parties hereto participated equally
in the drafting hereto, and any uncertainty or ambiguity shall not be
interpreted against any one party. As a result of the foregoing, any
rule of construction that a document is to be construed against the
drafting party shall not be applicable.
15. Mandatory Arbitration, The parties will attempt through good faith
-----------------------
negotiation to resolve their disputes. The term "disputes" includes,
without limitation, any disagreements between the parties concerning
the existence, formation and interpretation of disputes by
negotiation, any controversy or claim between or among the parties
relating to this Security Agreement and any claim based on or arising
from an alleged or shall be, determined by arbitration, Either party
may commence the arbitration by sending a written notice of
arbitration to the other party. The arbitration shall be held in
Philadelphia, Pennsylvania, by the American Arbitration Association,
pursuant to the Commercial Arbitration Rules of the American
Arbitration Association then in effect. The Arbitrator shall be an
attorney or judge knowledgeable in the parties and judgment may be
entered upon such decision in accordance with applicable law in any
court having jurisdiction hereof. Notwithstanding anything contained
herein, the parties reserve the right to seek a judicial temporary
restraining order, preliminary injunction or other similar short term
equitable relief prior to the appointment of the arbitrator. The
Arbitral Tribunal will have the right to make a final determination of
the parties rights, including whether to make permanent, modify or
dissolve any such judicial order.
16. Attorneys' Fees, Subsequent Litigation. If any party to this Security
-----------------------------------------
Agreement shall institute an arbitration or any other action or
proceeding to interpret or enforce this Security Agreement, or to
obtain damages by reason of any alleged breach of this Security
Agreement, the prevailing party shall be entitled to recover costs of
suit or arbitration and a reasonable sum for attorneys fees, all of
which shall be deemed to have accrued upon the commencement of such
action and shall be paid whether or not such action is prosecuted to
award/judgment. The award/judgment costs incurred in enforcing such
award/judgment or order. For the purpose of this section, attorneys
fees shall include, without limitation, fees incurred in the
following: (a) Postjudgment motions; (b) Contempt proceedings; (c)
Garnishment levy and Debtor and third-party examinations; (d)
Discovery; and (e) Bankruptcy litigation.
17. Governing Law. This Security Agreement shall be governed in all
--------------
respects, including validity, interpretation, effect and enforcement,
by the laws of the State of Pennsylvania.
18. Counterparts. This Security Agreement may be executed in counterparts,
------------
each of which, when so executed and delivered, shall be an original;
however, such counterparts together shall constitute but one and the
same agreement.
(BALANCE OF PAGE INTENTIONALLY LEFT BLANK)
19. Headings. The headings used herein are for convenience of reference
---------
only and do not constitute a part of this Security Agreement and shall
not be deemed to limit or effect any of the provisions hereof.
IN WITNESS WHEROF, the parties hereto have executed this Security Agreement
effective as of the day and year above first written.
TRIM FAST GROUP, INC., a Nevada corporation
By:/s/ Xxxxxxx Xxxxx
--------------------
Name: Xxxxxxx Xxxxx
-----------------
Title: C.E.O.
---------
And
By:________________
Name:______________
Title:_____________
FAC ENTERPRISES, INC. a Pennsylvania corporation
By: /s/ Xxxxxx Xxxxx
------------------
Name: Xxxxxx Xxxxx
------------------
Title: President
---------------
And
By:________________
Name:______________
Title:_____________
GIBRALT U.S., INC., a Colorado corporation
By: /s/ X. Xxxxxx
-----------------
Name: Xxxx Xxxxxx
-----------------
Title: Treasurer
-----------------
And
By:________________
Name:______________
Title:_____________
ESCROW INSTRUCTIONS
Dated as of April 25, 2000
Xxxxxxxxx, Xxxxxx & Xxxxxxxxx L.L.P.
0000 Xxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Attention: L. Xxxxxxx Xxxxxxxx, Esq.
Dear Xx. Xxxxxxxx:
As escrow agent for Trim Fast Group, INC., a Nevada corporation (the
"Company"), and the purchaser (the "Purchaser") of its twelve percent (12%)
Convertible Debentures due July 13, 2001 (the "Debentures") of the Company, who
are named in the Subscription Agreements between the Company and each Purchaser
to which a copy of these Escrow Instructions is attached (the "Agreement"), you
(hereafter the "Escrow Agent") are hereby authorized and directed to hold the
documents and the funds from the Purchaser in payment for the purchase of the
Debentures (together with interest, if any, thereon), (the "Escrow Funds")
delivered to the Escrow Agent pursuant to the terms of paragraph 1 of the
Agreement and in accordance with the following instructions:
1. The Escrow Agent shall, as promptly as feasible, notify the Company
of receipt of the funds from the Purchaser in payment for the Debentures
subscribed for and notify the Purchaser (or such agent as the Purchaser may
designate in writing) of receipt of certificates for the Debentures (each a
"Certificate") and collectively the ("Certificates"). As promptly as feasible
upon receipt of notice (whether oral or in written form) from the Company and
the Purchaser that the respective conditions precedent to the purchase and sale
of the Debentures have been satisfied (which notice shall not be unreasonably
withheld and shall be deemed given if no notice to the contrary is received by
the Escrow Agent within two (2) business days after notice from the Escrow
Agent is sent to the Company and Purchaser, as discussed above), the Escrow
Agent shall, after reduction of the amounts referred to in the next succeeding
sentence of this paragraph, release the Escrow Funds to the Company and shall
release the Certificates to the Purchaser by hand or overnight courier. After
receipt of such notice, the Escrow Funds shall be released by the Escrow Agent
as follows: One percent (1%) of the Escrow Funds shall be paid to Escrow Agent
as its fee hereunder, and the remainder shall be released to the Company. If
such Certificates are not deposited with the Escrow Agent within five (5) days
after receipt by the Company of notice of receipt by the Escrow Agent of the
funds for the Purchaser, Escrow Agent shall notify the Purchaser and Purchaser
shall be entitled to cancel the subscription by written notice to the Escrow
Agent and demand repayment of funds. If the Company or the Purchaser notifies
the Escrow Agent in writing that on the Closing Date (as defined in the
Agreement) the conditions precedent to the obligations of the Company or the
Purchaser, as the case may be, under the Agreement were not satisfied or waived,
then the Escrow Agent shall return the Escrow Funds to the Purchaser and shall
return the Certificates to the Company. Prior to return of the Escrow Funds to
the Purchaser, the Purchaser shall furnish such tax reporting or other
information as shall be appropriate for the Escrow Agent to comply with
applicable United States laws. The Escrow Agent shall deposit all funds received
hereunder in the Escrow Agent's attorney/client trust account at Manufacturers
Bank. Any interest on the Escrow Funds shall be paid to the Company regardless
of whether the Purchaser's subscription funds are returned to the Purchaser.
2. The Escrow Agent's duties hereunder may be altered, amended,
modified, or revoked only by a single writing by the Company, the Purchaser, and
the Escrow Agent. The Escrow Agent shall be obligated only for the performance
of such duties as are specifically set forth and may rely and shall be protected
in relying or refraining from acting on any instrument whether a copy or an
original or a fax of an instrument reasonably believed by the Escrow Agent to be
genuine and to have been signed or presented by the proper party or parties. The
Escrow Agent shall not be personally liable for any act done or omitted by the
Escrow Agent and any such act shall be conclusive evidence of such good faith.
3. The Escrow Agent is expressly authorized to disregard any and all
warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law and is hereby
expressly authorized to comply with and obey orders, judgments, or decrees of
any court. In case the Escrow Agent obeys or complies with any such order,
judgment, or decree, the Escrow Agent shall not be liable to any of the parties
hereto or to any other person, firm or corporation by reason of such decree
subsequently reversed, modified, annulled, set aside, vacated, or found to have
been entered without jurisdiction.
4. The Escrow Agent shall not be liable in any respect on account of
the identity, authorities, or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement or any document or papers
deposited or called for hereunder.
5. The Escrow Agent shall be entitled to employ such legal counsel and
other experts as the Escrow Agent may deem necessary properly to advise the
Escrow Agent in connection with the Escrow Agent's duties hereunder, and rely
upon the advice of such counsel, and may pay such counsel reasonable
compensation therefore.
6. The Escrow Agent's responsibilities as Escrow Agent hereunder shall
terminate if the Escrow Agent shall resign by written notice to the Company and
the Purchaser's. In the event of any such resignation, the Purchaser and the
Company shall appoint a successor Escrow Agent.
7. If the Escrow Agent reasonably requires other or further instruments
in connection with these Escrow Instructions or obligations in respect hereto,
the necessary parties hereto shall join in furnishing such instruments.
8. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the
documents, Certificates, or Escrow Funds held by the Escrow Agent hereunder, the
Escrow Agent is authorized and directed in the Escrow Agent's sole discretion
(a) to retain in the Escrow Agent's possession without liability to anyone all
or any part of said documents, certificates, or Escrow Funds until such disputes
shall have been settled either by mutual written agreement of the parties
concerned or by a final order, decree, or judgment of a court of competent
jurisdiction after the time for appeal has expired and no appeal has been
perfected, but the Escrow Agent shall be under no duty whatsoever to institute
or defend any such proceedings or (b) to deliver the Escrow Funds and any other
property, Certificates and documents held by the Escrow Agent hereunder to a
state or federal court having competent subject matter jurisdiction and located
in the state of Pennsylvania in accordance with the applicable procedure
therefore.
9. The Company and the Purchaser agree jointly and severally to
indemnify and hold harmless the Escrow Agent from any and all claims,
liabilities, costs or expenses in any way arising from or relating to the duties
or performance of the Escrow Agent hereunder other than any such claim,
liability, cost, or expense to the extent to the extent that shall have been
determined by final, unappealable judgment of a court of competent jurisdiction
to have resulted from the gross negligence or willful misconduct of the Escrow
Agent.
10. Any notice required or permitted hereunder shall be given in
writing (unless otherwise specified herein) and shall be deemed effectively
given upon personal delivery on three (3) business days after deposit in the
United States mail, by registered or certified mail with postage and fees
prepaid, addressed to each of the other parties thereto entitled at the
following addresses, or at such addresses as a party may designate by ten (10)
days advance written notice to each of the other parties hereto.
If to the Company: TRIM FAST GROUP, INC.
000 X. Xxxxxxx Xxxxxx Xxxx., Xxxxx 000
Xxxxx, Xxxxxxx 00000
Telephone (000) 000-0000
Facsimile (000) 000-0000
If to the Purchaser: At the addresses set forth on the last page of
the Subscription Agreements and below with signatures
If to the Escrow Agent:
Xxxxxxxxx, Xxxxxx & Xxxxxxxxx, L.L.P.
0000 Xxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxxxx 00000
Attn.: L. Xxxxxxx Xxxxxxxx, Esq.
Facsimile (000) 000-0000
11. By signing these Escrow Instructions, the Escrow Agent becomes a
party hereto only for the purpose of these Escrow Instructions; the Escrow Agent
does not become a party to the Agreement. The Company and the Purchasers have
become parties by their execution and delivery of the agreement, as provided
therein.
12. This instrument shall be binding upon and inure to the benefit of
the parties hereto, and their respective successors and permitted assigns and
shall be governed by the laws of the State of Pennsylvania without giving effect
to principles governing the conflicts of laws. A facsimile transmission of these
instructions signed by the Escrow Agent shall be legal and binding on all
parties hereto.
13. Capitalized terms used herein and not otherwise defined herein
shall have the respective meanings provided in the Agreement.
TRIM FAST GROUP, INC.
By: /S/ Xxxxxxx Xxxxx
-------------------
Name: Xxxxxxx Xxxxx
---------------
Title: C.E.O.
-------
and
By: __________________________
Name: __________________________
Title: __________________________
ACCEPTED BY ESCROW AGENT:
XXXXXXXXX, XXXXXX & XXXXXXXXX, L.L.P.
By: _____________________________, authorized representative
(SIGNATURES OF PURCHASERS FOLLOW)
AGREED THIS 25TH DAY OF APRIL, 2000 BY:
PURCHASER:
FAC ENTERPRISES, INC., a corporation
GSB Building
0 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Fax No.: (000) 000-0000
By: /s/ Xxxxxx Xxxxx
--------------------
Name: Xxxxxx Xxxxx
------------------
Title: President
-----------------
and
By:_________________________________
Name:_______________________________
Title:______________________________
(SIGNATURES CONTINUE)
AGREED THIS 25TH DAY OF APRIL, 2000 BY:
PURCHASER:
GIBRALT U.S.,INC., a Colorado corporation
Xxxxx 0000
0000 X. Xxxxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X0X0
Phone No.: (000) 000-0000
Fax No.: (000) 000-0000
By: /S/ XXXX XXXXXX
------------------
Name: XXXX XXXXXX
--------------
Title: Treasurer
----------
and
By: /S/ XXXX XXXXXX
------------------
Name: XXXX XXXXXX
--------------
Title: Assistant Vice President
---------------------------
