AGREEMENT
Exhibit 10.4
This agreement (“Agreement”) is made as of this 4th day of October, 2006 between PawnMart,
Inc. (“PawnMart”) and Integrity Mutual Funds, Inc. (“Integrity”). Sometimes PawnMart and Integrity
are referred to herein individually as a “party” and collectively as the “parties.”
WHEREAS, PawnMart owns 3,050,000 Series A Convertible Preferred Shares (the “Shares”) of
Integrity, which Shares are convertible on a one-for-one basis into shares of common shares of
Integrity (the “Common Shares”); and
WHEREAS, the parties desire to place certain restrictions on the conversion of the Shares.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. On or before the earlier to occur of (a) September 30, 2008 or (b) a Sale of Integrity
(defined herein) PawnMart agrees that it will not convert such number of Shares that, combined with
PawnMart’s and its affiliates’ then holdings of Common Shares, will cause PawnMart and its
affiliates to own more than twenty-five percent (25%) of the outstanding Common Shares.
2. Following the earlier to occur of (i) September 30, 2008 or (ii) a Sale of Integrity,
PawnMart can convert Shares free and clear of any restrictions imposed by this Agreement.
3. For purposes of this Agreement, a “Sale of Integrity” means the occurrence of any one of
the following events: (i) the sale or other transfer of fifty percent (50%) or more of the Common
Shares; (ii) the sale of all or substantially all of the assets of Integrity; (iii) the merger,
consolidation or other reorganization of Integrity with and into another entity, whether or not
Integrity is the surviving entity, in which the Common Shares are converted into shares of the
successor entity or a holding company thereof (representing fifty percent (50%) or less of the
voting power of all capital shares thereof immediately after the merger or consolidation); or (iv)
the approval of a plan of complete liquidation of Integrity.
IN WITNESS WHEREOF, the parties hereto have duly caused this Agreement to be executed in
multiple counterparts as of the day and year first above written.
PAWNMART: | PAWNMART, INC. | |||||
By: | /s/ Xxxxxx X. Xxxxxx | |||||
Xxxxxx X. Xxxxxx, Executive Vice President | ||||||
INTEGRITY: | INTEGRITY MUTUAL FUNDS, INC. | |||||
By: | /s/ Xxxxxx X. Xxxxxxx | |||||
Xxxxxx X. Xxxxxxx, | ||||||
Chief Executive Officer |