AMERICAN INFLATABLES, INC.
SHAREHOLDERS AGREEMENT
This American Inflatables, Inc. Shareholders Agreement (this
"Agreement") is entered into as of May 16, 2002, by and between William R.
Fairbanks, Red Oak Limited Partnership, a South Carolina limited partnership,
Douglas A. Brown (each of the foregoing, an "ASDG Shareholder"), the sole
shareholders of American Sports Development Group, Inc., a South Carolina
corporation formerly known as National Paintball Supply Company, Inc. ("ASDG"),
American Inflatables, Inc., a Delaware corporation ("Inflatables"), and the
Inflatables shareholders set forth in the table in Section 3 hereof (each an
"Inflatables Shareholder").
WHEREAS, the ASDG Shareholders and Inflatables have entered into a
Share Exchange Agreement dated May 16, 2002 (the "Share Exchange Agreement"),
providing for the issuance by Inflatables of securities of Inflatables having
83% of the voting and distribution rights of all security holders of Inflatables
on a fully-diluted basis after the issuance of such securities in exchange for
all of the issued and outstanding equity securities of ASDG (the "Share
Exchange"), which transaction is intended to be consummated no later than May
31, 2002;
WHEREAS, the Share Exchange Agreement replaces and supercedes that
certain Reorganization Agreement dated October 12, 2000, as amended by
Amendments No. 1, 2 and 3 thereto by and between ASDG and Inflatables (the
"Reorganization Agreement") that contemplated the merger of Inflatables with and
into a wholly-owned subsidiary of ASDG with the end result that Inflatables
would become a wholly-owned subsidiary of ASDG (the "Merger");
WHEREAS, each Inflatables Shareholder is the beneficial owner of
substantial amounts of the common stock, par value $0.001 per share, of
Inflatables (the "Inflatables Common Stock");
WHEREAS, a lawsuit brought by Inflatables Shareholders Universal
Consultants, Inc., a Nevada corporation ("UCI"), National Financial, Inc., a
Nevada corporation ("NFI"), and Mr. William Carroll against Gregg R. Mulholland,
a director and the President and Chief Executive Officer of Inflatables, and
David W. Ariss, Jr., a director of Inflatables, solely in their respective
individual capacities (the "Lawsuit"), prevented consummation of the Merger
prior to the date by which ASDG could terminate the Reorganization Agreement;
WHEREAS, the ASDG Shareholders, Inflatables and the Inflatables
Shareholders desire that the transactions contemplated in the Share Exchange
Agreement be consummated in replacement of the transactions contemplated in the
Reorganization Agreement; however, the ASDG Shareholders will not enter into the
Share Exchange Agreement or the transactions contemplated therein unless the
Inflatables Shareholders enter into this Agreement; and
WHEREAS, The Inflatables Shareholders desire to enter into this
Agreement to induce the ASDG Shareholders to enter into the Share Exchange
Agreement and the transactions contemplated therein and would not enter into
this Agreement but for the execution of the Share Exchange Agreement and its
full consummation;
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NOW THEREFORE, in order to induce the ASDG Shareholders to enter into
the Share Exchange Agreement and to consummate the transactions contemplated
therein, and in consideration for the mutual covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. DEFINITIONS. Capitalized terms used in this Agreement and not
defined in this Agreement have the meaning ascribed to such terms in the Share
Exchange Agreement.
2. EFFECTIVE DATE; CONDITIONS TO EFFECTIVENESS. This Agreement shall
only become effective if the Share Exchange is consummated, in which case this
Agreement shall become effective on the Closing Date. In the event of any
rescission of the Share Exchange as contemplated in the Share Exchange
Agreement, this Agreement shall be rescinded as well except that the Inflatables
Shareholders' obligations under Section 11 hereof and any related provisions of
Section 12 hereof shall remain in full force and effect and shall not be
rescinded.
3. REPRESENTATIONS AND WARRANTIES OF INFLATABLES SHAREHOLDERS. Each
Inflatables Shareholder hereby represents and warrants to the ASDG Shareholders
and Inflatables with respect to itself only:
(a) That the information set forth below is true, complete and
correct in all respects:
Number of Inflatables Percent
Name and Address Shares Beneficially of Class
of Inflatables Shareholder Owned (18)
----------------------------------- ------------------------ --------------
William Carroll 4,953,984 (1) 49.2%
13337 E. South St. #160
Ceritos, California 91101
National Financial, Inc. 1,500,000 (2) 17.2%
38855 Decautur Blvd., Suite 2010
Las Vegas, Nevada 89103
Yvonne M. Hines 1,575,700 (3) 18.0%
16429 Alora Ave.
Norwalk, California 90650
William J. Heldman 1,660,000 (4) 19.0%
1085 Acquiro St.
Corona, California 92879
Universal Consultants, Inc. 3,178,984 (5) 31.6%
221 E. Walnut St., Suite 2000
Pasadena, California 91101
James T. Calo 3,178,984 (6) 31.6%
221 E. Walnut St., Suite 2000
Pasadena, California 91101
Timothy N. Roberts 632,500 (7) 7.2%
130 McCormick Ave. #230
Costa Mesa, California 92626
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TNR Development Company 625,000 (8) 7.1%
130 McCormick Ave. #230
Costa Mesa, California 92626
Apex One, Inc. 25,000 (9) 0.3%
38855 Decatur Boulevard, Suite 2010
Las Vegas, Nevada 89103
Apollo One, Inc. 50,000 (10) 0.6%
38855 Decatur Boulevard, Suite 2010
Las Vegas, Nevada 89103
Certified One, Inc. 40,000 (11) 0.5%
38855 Decatur Boulevard, Suite 2010
Las Vegas, Nevada 89103
Dylan's Dance Hall, Inc. 415,000 (12) 4.7%
3333 Michelson Drive, Suite 800
Irvine, California 92612-1694
Prestige Financial, Inc. 100,000 (13) 1.1%
13337 E. South Street, # 160
Cerritos, California 90703
Silver County Financial, Inc. 60,000 (14) 0.7%
13337 E. South Street, # 160
Cerritos, California 90703
Gregg R. Mulholland (15) 3,053,984 34.9%
947 Newhall Street
Costa Mesa, California 92627
Fax: (949) 515-9765
Jeffrey Jacobson (16) 300,000 3.4%
947 Newhall Street
Costa Mesa, California 92627
Fax: (949) 515-9765
David W. Ariss, Sr. (17) 50,000 0.6%
947 Newhall Street
Costa Mesa, California 92627
Fax: (949) 515-9765
(1) Includes (a) 3,178,984 shares beneficially owned by UCI, of which Mr.
Carroll is a director and 50% shareholder, (b) 1,500,000 shares
beneficially owned by NFI, of which Mr. Carroll is a director and 25%
shareholder, (c) 100,000 shares beneficially owned by Prestige
Financial, Inc., (d) 60,000 shares beneficially owned by Silver County
Financial, (e) 25,000 shares beneficially owned by Apex One, Inc., (f)
50,000 shares beneficially owned by Apollo One, Inc. of which Mr.
Carroll is a President and (g) 40,000 shares beneficially owned by
Certified One, Inc.
(2) Includes 500,000 shares issuable upon exercise of an option for shares
owned by Gregg Mulholland, 250,000 shares owned directly by NFI and
750,000 shares of Mr. Mulholland's stock held in escrow distributable
to NFI pursuant to the Settlement Agreement (as defined below).
Pursuant to the Settlement Agreement, 1,250,000 of Mr. Mulholland's
shares are distributable to NFI in exchange for which the 500,000
share option would be cancelled.
(3) Includes 1,500,000 shares beneficially owned by NFI, of which Ms.
Hines is an officer, director and 50% shareholder, and 75,700 shares
held directly by Ms. Hines.
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(4) Includes (a) 1,500,000 shares beneficially owned by NFI, of which Mr.
Heldman is an officer, director and 25% shareholder, (b) 100,000
shares beneficially owned by Prestige Financial, Inc. of which Mr.
Heldman is President, and (c) 60,000 shares beneficially owned by
Silver County Financial of which Mr. Heldman is President.
(5) Includes 1,320,000 shares issuable upon exercise of a warrant, 55,000
shares held directly by UCI and 1,803,984 shares of Mr. Mulholland's
stock held in escrow distributable to UCI pursuant to the Settlement
Agreement (as defined below).
(6) Includes 3,178,984 shares beneficially owned by UCI, of which Mr. Calo
is a director and 50% shareholder.
(7) Includes 700,000 shares beneficially owned by TNR Development Company,
of which Mr. Roberts is an officer and director and the sole
shareholder, and 7,500 shares owned directly by Mr. Roberts.
(8) TNR Development Company ("TNR") acquired an option for 600,000 shares
with an exercise price of $1.00 per share from NFI on May 1, 2000 in a
private transaction. On May 8, 2000, TNR acquired 210,000 shares and
a warrant for 600,000 shares with an exercise price of $0.25 per
share from Inflatables in a private placement of units consisting of
thirty five (35) shares and a warrant to purchase one hundred (100)
shares for an aggregate purchase price of $25.00 per unit (the "May
2000 Private Placement"). The warrant for 600,000 shares with an
exercise price of $0.25 per share TNR acquired in the May 2000 Private
Placement replaced the option for 600,000 shares with an exercise
price of $1.00 per share that TNR acquired from NFI on May 1, 2000,
which option was thereafter null and void. On May 14, 2000, TNR
transferred 60,000, 50,000, 40,000 and 35,000 of the shares to Silver
County Financial, Inc., Apollo One, Inc., Certified One, Inc. and
UCI, respectively, in private transactions. TNR exercised the warrant
for 600,000 shares with an exercise price of $0.25 per share on
September 20, 2000 by delivery to Inflatables of the TNR Note (as
defined below).
(9) Apex One, Inc. acquired these shares from Dylan's Dance Hall, Inc. in
a private transaction on May 14, 2000.
(10) Apollo One, Inc. acquired these shares from TNR in a private
transaction on May 14, 2000.
(11) Certified One, Inc. acquired these shares from TNR in a private
transaction on May 14, 2000.
(12) Dylan's Dance Hall, Inc. ("Dylan's") acquired an option for 400,000
shares with an exercise price of $1.00 per share from NFI on May 1,
2000 in a private transaction. On May 8, 2000, Dylan's acquired
140,000 shares and a warrant for 400,000 shares with an exercise
price of $0.25 per share from Inflatables in the May 2000 Private
Placement. The warrant for 400,000 shares with an exercise price of
$0.25 per share Dylan's acquired in the May 2000 Private Placement
replaced the option for 400,000 shares with an exercise price of
$1.00 per share that Dylan's acquired from NFI on May 1, 2000, which
option was thereafter null and void. On May 14, 2000, Dylan's sold
100,000 and 25,000 of the shares to Prestige Financial, Inc. and
Apex One, Inc., respectively, in private transactions. Dylan's
exercised the warrant to acquire 400,000 shares with an exercise price
of $0.25 per share on September 20, 2000 by delivery to Inflatables
of the Dylan's Note (as defined below).
(13) Prestige Financial, Inc. acquired these shares from Dylan's in a
private transaction on May 14, 2000.
(14) Silver County Financial, Inc. acquired these shares from TNR in a
private transaction on May 14, 2000.
(15) Mr. Mulholland is the president, chief executive officer and a
director of Inflatables. See Notes (2) and (5).
(16) Mr. Jacobson is a senior vice president and a director of Inflatables.
(17) Mr. Ariss is a director of Inflatables.
(18) Based on 8,746,346 Inflatables shares issued and outstanding.
(b) That set forth below is a list of all of the agreements
(including without limitation all Rights and related documents) to which
Inflatables and any Inflatables Shareholder are parties with each other. There
are no other agreements (or Rights or related documents) between Inflatables and
any Inflatables Shareholder.
(1.1) Modified and Restated Option Agreement to Purchase Stock
dated February 7, 2000 by and between NFI, Inflatables and
Gregg Mulholland (the "February 2000 Option Agreement").
(1.2) Guaranty dated February 7, 2000 of David W. Ariss, Jr.
related to the February 2000 Option Agreement.
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(1.3) Deed of Trust with Assignment of Rents dated March 3, 2000 by
and between David W. Ariss, Jr., First American Title
Insurance Company, and NFI related to the February 2000
Option Agreement.
(2.1) Secured Promissory Note dated December 12, 2000, in the
principal amount of $330,000.00, with Inflatables as Maker
and UCI as Payee (the "UCI Secured Note").
(2.2) Security Agreement dated December 12, 2000 by and between
Inflatables and UCI related to the UCI Secured Note (the "UCI
Security Agreement").
(2.3) Guaranty dated December 12, 2000 by and between Gregg R.
Mulholland and UCI related to the UCI Secured Note.
(2.4) Warrant dated December 20, 2000 for 1,320,000 shares of
Inflatables common stock with exercise price of $0.25 per
share and an expiration date of December 31, 2003 issued by
Inflatables to UCI (the "UCI Warrant").
(3) Settlement Agreement by and between UCI, NFI, William
Carroll, Gregg R. Mulholland and David W. Ariss, Jr. filed
on or about December 31, 2001 with Permanent Protective Order
issued by the Superior Court of the State of California,
County of Orange in Case No. 01CC14645, including Exhibits
A - M thereto (the "Settlement Agreement").
(4.1) Secured Promissory Note dated September 20, 2000, $100,000 in
principal amount (the "Dylan's Note"), issued by Dylan's
Dance Hall, Inc., a Nevada corporation ("Dylan's Dance Hall")
to Inflatables secured by 400,000 shares of Inflatables
common stock pursuant to the Security Agreement dated
September 20, 2000 (the "Dylan's Security Agreement") by and
between Dylan's Dance Hall and Inflatables.
(4.2) Secured Promissory Note dated September 20, 2000, $150,000 in
principal amount (the "TNR Note"), issued by TNR Development,
Inc., a Nevada corporation ("TNR") to Inflatables secured by
600,000 shares of Inflatables common stock pursuant to the
Security Agreement dated September 20, 2000 (the "TNR
Security Agreement") by and between TNR and Inflatables.
(c) That the Settlement Agreement satisfies all claims
between each Inflatables Shareholder and Inflatables existing as of the date
hereof.
(d) That (1) such Inflatables Shareholder is not the
beneficial owner of any equity securities or securities convertible into or
exercisable for equity securities of Inflatables other than as disclosed in the
table and notes thereto set forth above in Section 3(a) of this Agreement (the
"Inflatables Shareholder Beneficial Ownership Table"), and (2) has never
transferred or granted to any party any equity securities or rights, warrants,
options or other securities convertible into or exercisable for equity
securities of Inflatables except for transfers of such securities to parties set
forth and reflected in the Inflatables Shareholder Beneficial Ownership Table.
4. CANCELLATION OF OTHER SECURITIES, WARRANTS AND OPTIONS. In the
event that any Inflatables Shareholder is the beneficial owner of any rights,
options, warrants or other securities exercisable for equity securities of
Inflatables that are not disclosed in the Inflatables Shareholder Beneficial
Ownership Table, such Inflatables Shareholder hereby agrees to the termination,
cancellation and expiration, without exercise or cost or penalty to Inflatables,
ASDG or any other party, of such rights, options, warrants or other securities,
effective as of the date hereof. In the event that any Inflatables Shareholder
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is the beneficial owner of any securities otherwise convertible into equity
securities of Inflatables, such Inflatables Shareholder hereby agrees that such
securities are hereby amended, effective as of the date hereof, to delete in
their entirety all provisions of such securities providing for or related to the
convertibility of such security into equity securities of Inflatables. Each
Inflatables Shareholder hereby represents and warrants that he, she or it has no
preemptive rights with respect to the issuance of any of the shares of
Inflatables Common Stock to be issued pursuant to the Share Exchange Agreement,
and in the event that despite such representation and warranty such Inflatables
Shareholder does have any preemptive rights with respect to the issuance of
shares of Inflatables Common Stock pursuant to the Share Exchange Agreement,
such Inflatables Shareholder waives any and all such preemptive rights.
5. RELEASE OF CLAIMS.
(a) Complete Release. Each Inflatables Shareholder hereby
for himself, herself or itself, his, her or its heirs, representatives,
executors, administrators, successors, and assigns, do hereby completely
release, acquit and forever discharge Inflatables, ASDG and their owners,
stockholders, predecessors, successors, assigns, agents, directors, officers,
employees, representatives, attorneys, subsidiaries, and affiliates
(collectively, "Releasees") from any and all charges, complaints, claims,
liabilities, obligations, promises, agreements, damages, actions, causes of
action, suits, rights, demands, costs, losses, debts, and expenses (including
attorney's fees and costs actually incurred), of any nature whatsoever, known or
unknown, which such Inflatables Shareholder now has, has ever had, or may in the
future have relating to circumstances existing as of the date hereof, involving
any Releasees, ("Claim" or "Claims"), including without limitation any Claim or
Claims relating to any agreement or instrument set forth in Section 3(b) hereof,
except for (1) Inflatables' obligation to issue shares of its common stock
pursuant to the UCI Warrant and (2) the obligations of Gregg R. Mulholland and
David W. Ariss, Jr. under the Settlement Agreement.
(b) No Actions Pending. Each Inflatables Shareholder hereby
represents that, other than claims or counterclaims filed in connection with the
Lawsuit, it has not filed any lawsuit, claim or complaint against any party
relating to any agreement to which Inflatables is a party or by which any of its
properties are bound, or against any officer, employee, affiliate or subsidiary
of Inflatables, in any state, federal or municipal court or other forum or with
any administrative agency or tribunal, and that it will not do so at any time
hereafter in respect to or arising out of any Claim or Claims released pursuant
to Section 5(a) of this Agreement.
(c) Voluntary and Informed Release. Each Inflatables
Shareholder hereby acknowledges and represents that he, she or it is effecting
this settlement and executing this Agreement after having received full legal
counsel from the attorney of his, her or its choice. In executing this Agreement
each Inflatables Shareholder understands that he, she or it is forever bound by
its terms and conditions.
(d) Release of Unknown Claims. Each Inflatables Shareholder
hereby acknowledges and agrees that this Agreement, to the extent permitted by
applicable law, constitutes a general release with respect to any real or
potential dispute arising out of or in any way related to any Claim. Each
Inflatables Shareholder further understands and expressly waives any and all
claims for damages, known, unknown, speculative, ascertained in the future, or
which he, she or it does not know of or suspect to exist, whether through
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ignorance, oversight, error, negligence, or otherwise, and which if known, would
materially affect his, her or its decision to execute this Agreement.
(e) Non-assignment of Claims. Each Inflatables Shareholder
hereby represents and warrants that no other person or entity has or had any
interest in any of the claims or counterclaims being released pursuant to this
Agreement; that he, she or it has the sole right and exclusive authority to
execute this Agreement and receive the consideration specified in it; and that
he, she or it has not sold, assigned, transferred, conveyed or otherwise
disposed of any such claims.
(f) No Reliance on Other Party's Representations. Each
Inflatables Shareholder hereby represents and warrants that in executing this
Agreement, he, she or it did not rely and has not relied upon any representation
or statement made by any of the other Releasees or by any of the other
Releasee's agents, representatives, or attorneys with regard to the subject
matter, basis or affect of this Agreement or otherwise.
6. ASSIGNMENT OF CLAIMS NOT RELEASED. To the extent any Inflatables
Shareholder has Claims against any Releasee that are not released by this
Agreement, such Inflatables Shareholder assigns such Claim(s) in full, and any
and all rights related thereto, to William R. Fairbanks and Douglas A. Brown in
proportion to their ownership of ASDG common stock as of the date hereof.
7. CHANGE OF INFLATABLES OFFICERS AND DIRECTORS AT CLOSING. At the
Closing, following the Share Exchange, (a) Mr. Gregg Mulholland, Mr. David W.
Ariss and Mr. Jeffrey Jacobson will resign from all positions, if any, that they
hold as officers of Inflatables, (b) then the Inflatables Board of Directors,
by unanimous written consent in form and substance acceptable to William R.
Fairbanks and Douglas A. Brown, shall (i) appoint Mr. Fairbanks and Mr. Brown to
the Inflatables Board of Directors, (ii) appoint Mr. Fairbanks Chairman,
President and Chief Executive Officer of Inflatables, (iii) appoint Mr. Brown
Vice President of Inflatables and (iv) appoint Mr. Jacobson Vice President
and Chief Operating Officer of Inflatables, and (c) then all directors of
Inflatables other than Mr. Fairbanks and Mr. Brown, including without limitation
Mr. Mulholland, Mr. Jacobson and Mr. Ariss, shall resign as directors of
Inflatables.
8. PREPAYMENT OF TNR AND DYLAN'S DANCE HALL NOTES. Each of TNR and
Dylan's Dance Hall hereby agree to pay in full all amounts owing by them under
the TNR Note and the Dylan's Note, respectively, within thirty (30) days of the
Closing Date. Upon such payment in full of each such note, that note shall be
cancelled and deemed null and void and of no further force and effect, any
security interest securing such note shall terminate and be null and void and of
no further force and effect and any pledged collateral subject to such security
interest shall be promptly returned to the pledgee.
9. EXERCISE OF UCI WARRANT AND EXTINGUISHMENT OF DEBT FOR PRINCIPAL
UNDER UCI SECURED NOTE. Immediately prior to the Closing, UCI shall exercise the
UCI Warrant in full and shall pay the exercise price thereunder ($0.25 per share
for an aggregate amount of $330,000) by forgiving all indebtedness for the
outstanding principal (but not interest) under the UCI Secured Note, and
Inflatables shall issue to UCI 1,320,000 shares of Inflatables Common Stock. As
a result thereof, (i) all obligations of Inflatables under the UCI Secured Note,
the UCI Security Agreement and the UCI Warrant will be satisfied in full, (ii)
the UCI Security Agreement and the UCI Warrant shall be null and void and of no
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further force and effect, (iii) the UCI Secured Note shall be null and void and
of no further force and effect with respect to Inflatables, and (iv) Gregg R.
Mulholland shall remain fully liable to UCI for all accrued and unpaid interest
with respect to the UCI Secured Note, and all interest that shall subsequently
accrue on such accrued and unpaid interest, until paid in full by Mr. Mulholland
as contemplated in the Settlement Agreement. In the event that the average
closing price of Inflatables Common Stock for the 20 trading days following
Closing (the "Inflatables Closing Price") is less than $0.275 per share, Mr.
Mulholland shall owe UCI an amount equal to the product of (a) the difference
between $0.275 and the Inflatables Closing Price and (b) 1,320,000, to be paid
by Mr. Mulholland to UCI out of the escrow contemplated in the Settlement
Agreement in accordance with the provisions thereof.
10. CONTRIBUTION TO INFLATABLES CAPITAL BY GREGG R. MULHOLLAND.
Immediately prior to the Closing, Gregg R. Mulholland shall forgive debts owed
by Inflatables to him to the extent necessary to reduce the Total Pro Forma
Closing Debt to $400,000. The debts forgiven by Mr. Mulholland shall include,
but not be limited to, the principal amounts of and accrued and unpaid interest
under all loans of any nature from Mr. Mulholland to Inflatables, and shall
constitute a contribution to the capital of Inflatables with respect to Mr.
Mulholland's Inflatables Common Stock.
11. INDEMNIFICATION. Each party to this Agreement hereby agrees to
defend, indemnify and hold harmless ASDG, Inflatables, each other party to this
Agreement and their respective directors, officers, shareholders, affiliates,
employees, agents and contractors from and against any and all losses, damages,
claims, obligations, fines, penalties and liabilities of any sort or kind
(including without limitation reasonable attorneys fees, pursuant to California
Code of Civil Procedure Section 1717, if applicable, and/or otherwise) arising
in connection with the breach by such party of any of his, her or its
representations, warranties and/or covenants set forth in this Agreement.
12. MISCELLANEOUS.
(a) Notices. All notices and communications provided for
in this Agreement shall be given in accordance with the terms of the notice
provisions contained in the Share Exchange Agreement. The address for notice
to each Inflatables Shareholder shall be the address set forth in the table in
Section 3 above, and a copy of any notice to any of Gregg R. Mulholland, Jeffrey
Jacobson or David W. Ariss, Sr. shall be sent to:
Warren J. Soloski, Esq.
11300 West Olympic Boulevard
West Los Angeles, California 90025
Facsimile: (310) 473-1470
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and a copy of notice to any other Inflatables Shareholder other than. shall be
sent to:
Meir J. Westreich, Esq.
221 East Walnut Ave., Suite 200
Pasadena, California 91101
Fax: (626) 440-9970
(b) Amendment, Waiver in Writing. No amendment of any
provision of this Agreement shall be effective unless it is in writing and
signed by the parties hereto, and no waiver of any provision of this Agreement,
and no consent to any departure by any Inflatables Shareholder therefrom, shall
be effective unless it is in writing and signed by Inflatables and the ASDG
Shareholders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.
(c) Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of such provisions or the remaining provisions of this Agreement.
(d) No Strict Construction. The language used in this
Agreement shall be deemed to be the language chosen by the parties to express
their mutual intent, and no rule of strict construction shall be applied
against any Person.
(e) Captions; Interpretation. The captions used in this
Agreement are for convenience of reference only and do not constitute a part of
this Agreement and shall not be deemed to limit, characterize or in any way
affect any provision of this Agreement, and all provisions of this Agreement
shall be enforced and construed as if no caption had been used in this
Agreement. In this Agreement (i) words denoting the singular include the plural
and vice versa, (ii) "it" or "its" or words denoting any gender include all
genders, and (iii) the word "including" shall mean "including without
limitation", whether or not expressed.
(f) Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instrument. Rebuttable proof of
execution of this Agreement by any party may be made by presentation of a copy
of this Agreement bearing a facsimile or photostatic copy of the signature of
the party whose execution is sought to be proved, and such copies shall be as
valid as the originals and as admissible as evidence of proof of the execution
and terms and provisions hereof as the originals.
(g) Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement shall be governed by and construed
in accordance with the domestic laws of the State of South Carolina, without
giving effect to any provision (whether of the State of South Carolina or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of South Carolina.
(h) Time is of the Essence. Each party hereto agrees and
stipulates that time is of the essence with regard to his performance of his
obligations under this Agreement.
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(i) Successors & Assigns. This Agreement shall be binding on
each Inflatables Shareholder and his, her or its successors and assigns, and
inure, together with all rights and remedies of Inflatables and ASDG, to the
benefit of Inflatables and ASDG and their successors, transferees and assigns.
SIGNATURES ON FOLLOWING PAGE
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
/s/ William R. Fairbanks /s/ William Carroll
- --------------------------------- ----------------------------
William R. Fairbanks William Carroll
/s/ Douglas A. Brown /s/ Yvonne M. Hines
- --------------------------------- -----------------------------
Douglas A. Brown Yvonne M. Hines
/s/ Gregg R. Mulholland /s/ William E. Heldman
- --------------------------------- -----------------------------
Gregg R. Mulholland William E. Heldman
/s/ Jeffrey Jacobson /s/ James T. Calo
- --------------------------------- -----------------------------
Jeffrey Jacobson James T. Calo
/s/ David W. Ariss /s/ Timothy N. Roberts
- --------------------------------- -----------------------------
David W. Ariss, Sr. Timothy N. Roberts
AMERICAN INFLATABLES, INC. TNR DEVELOPMENT CORPORATION
By: /s/ Gregg R. Mulholland By: /s/ Timothy N. Roberts
----------------------------- -----------------------------
Gregg R. Mulholland, President Name: Timothy N. Roberts
-----------------------------
Title: President
-----------------------------
UNIVERSAL CONSULTANTS, INC. NATIONAL FINANCIAL, INC.
By: /s/ James T. Calo By: /s/ Yvonne M. Hines
----------------------------- -----------------------------
Name: James T. Calo Name: Yvonne M. Hines
--------------------------- -----------------------------
Title: President Title: President
-------------------------- -----------------------------
APEX ONE, INC. APOLLO ONE, INC.
By: /s/ John Schmitt By: /s/ Charles W. Carroll
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Name: John Schmitt Name: Charles W. Carroll
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Title: President Title: President
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CERTIFIED ONE, INC. DYLAN'S DANCE HALL, INC.
By: /s/ James Trumbo By: /s/ Robert T. Lannon
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Name: James Trumbo Name: Robert T. Lannon
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Title: President Title: President
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PRESTIGE FINANCIAL, INC. SILVER COUNTY FINANCIAL
By: /s/ William E. Heldman By: /s/ William E. Heldman
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Name: William E. Heldman Name: William E. Heldman
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Title: President Title: President
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RED OAK LIMITED PARTNERSHIP
By: /s/ William R. Fairbanks
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William R. Fairbanks, General Partner