-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LCLtiFrV0TKOLkbfoagHWEXrLem77dS2IGa2bK3bUs9u3K1n3tVGkwZ7b/XnnmH1 8PMDhL8EO0dPpb+vKcBDlw== /in/edgar/work/20000706/0001085037-00-000188/0001085037-00-000188.txt : 20000920 0001085037-00-000188.hdr.sgml : 20000920 ACCESSION NUMBER: 0001085037-00-000188 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20000622 ITEM INFORMATION: FILED AS OF DATE: 20000706 FILER: COMPANY DATA: COMPANY CONFORMED NAME: E FINANCIAL DEPOT COM CENTRAL INDEX KEY: 0001092310 STANDARD INDUSTRIAL CLASSIFICATION: [9995 ] IRS NUMBER: 330809711 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-26899 FILM NUMBER: 668438 BUSINESS ADDRESS: STREET 1: 1005-750 W PENDER CITY: VANCOUVER BC V6 2TB STATE: A1 BUSINESS PHONE: 6046816186 MAIL ADDRESS: STREET 1: 1875 CENTURY PARK EAST SUITE 150 CITY: CENTURY CITY STATE: CA ZIP: 90067 FORMER COMPANY: FORMER CONFORMED NAME: BALLYNAGEE ACQUISITION CORP DATE OF NAME CHANGE: 19990730 8-K 1 0001.txt OMB APPROVAL OMB Number: 3235-0060 Expires: May 31, 2000 Estimated average burden hours per response 5.00 -------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported) June 22, 2000 -------------- e-financial depot.com, Inc. ----------------------------- (Exact name of registrant as specified in its charter) Delaware 000-26899 33-0809711 - -------- --------- ---------- (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 150 - 1875 Century Park East, Century City, California 90067 - -------------------------------------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (877) 739-3812 --------------- (Former name or former address, if changed since last report.) ITEM 1. CHANGES IN CONTROL OF REGISTRANT. Not applicable. ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On June 22, 2000 the Registrant entered into an agreement (the "Share Purchase Agreement") with Westcor Mortgage Inc. ("Westcor") and Patricia Kirkham and Dennis Petersen, both business persons of Calgary, Alberta (the "Vendors") pursuant to which the Registrant acquired all of the issued common shares of Westcor (the "Vendors Shares"). Westcor is a private Alberta company which carries on the mortgage brokerage business. The assets of Westcor are primarily goodwill in the form of an operating brokerage which received commissions for placing approximately US$97 million in mortgages in 1999. The direct consideration for the purchase of the Vendors Shares (the "Transaction") was the payment of US$600,000 by the issue of two promissory notes totalling US$592,636 and a holdback retained by the Registrant of US$7,364. The promissory notes are secured by a pledge of the Vendors Shares in an agreement between the Vendors and the Registrant dated for reference February 29, 2000 (the "Hypothecation Agreement"). Prior to the acquisition of the Vendors Shares, Westcor issued to the Vendors 295520 Exchangeable shares of Westcor which are exchangeable into an equal number of common shares of the Registrant at a deemed price of US$4.25 per share. In addition, the Registrant issued 73880 common shares of the Registrant at the same deemed price to a financial intermediary, Oxford Capital Corp. ("Oxford"). Accordingly, the value of shares of the Registrant into which the Exchangeable shares may be exchanged was approximately US$1,255,960 and the total effective consideration for the Vendors Shares was US$2,169,950 of which US$313,990 in the form of common shares of the registrant was received by Oxford. All of the Exchangeable shares are held in escrow pending the completion of an audit of Westcor pursuant to an escrow agreement among the Registrant, the Vendors and Oxford dated for reference February 29 2000 (the "Escrow Agreement"). If the value of Westcor's assets as disclosed by the audit is less than that shown on Westcor's management prepared financial statements for the nine month period ending January 31, 2000, a proportionate number of Exchangeable shares will be cancelled prior to the release of Exchangeable shares from escrow. The consideration paid by the Registrant for the Vendors Shares was determined by negotiation with the Vendors. Prior to the closing of the Transaction the Vendors were completely at arms length from the Registrant and its affiliates. The Registrant intends to discharge its obligations under the promissory notes by carrying out one or more private placements of its common shares. In addition to the Share Purchase Agreement, the Hypothecation Agreement and the Escrow Agreement, the Registrant entered into two other agreements relating to the Transaction both dated for reference February 29, 2000. In an agreement with Westcor (the "Support Agreement") the Registrant agreed to refrain from making corporate distributions or alterations without protecting the holders of the Exchangeable shares by ensuring that they receive the equivalent value on any such distribution or alternation as they would have received if they had held common shares of the Registrant directly. The Registrant also agreed to ensure that Westcor is able to meet its obligation to deliver common shares of the Registrant on the exchange of the Exchangeable Shares. Pursuant to an agreement (the "Voting Trust and Exchange Agreement") with Westcor, the Vendors and Miller Thomson as trustee , the trustee will be issued one special voting share of the Registrant on behalf of the Vendors which will effectively allow the Vendors, as holders of Exchangeable Shares, to have one vote per each such share at general meetings of the Registrant. In addition, certain rights to exchange Exchangeable Shares for common stock of the Registrant are granted. The Voting Trust and Exchange Agreement also contains a grant by the Registrant to the Vendors of certain "piggy-back" rights to have the common shares of the Registrant which they receive on the exchange of their Exchangeable Shares registered concurrently with the registration of new issues of the Registrant's common stock. ITEM 3. BANKRUPTCY OR RECEIVERSHIP Not applicable. ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT Not applicable. ITEM 5. OTHER EVENTS Not applicable. ITEM 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS Not applicable. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (a) Financial Statements of Businesses Acquired It is not practicable to provide financial statements of the acquired companies prepared in accordance with the regulations on the date hereof. Accordingly, the required financial statements will be filed as an amendment to this Current Report on Form 8-K as soon as practicable, but not later than (60 days after this Current Report on Form 8-K must be filed). (b) Pro Forma Financial Information It is not practicable to provide the required pro forma financial statements on the date hereof. Accordingly, the pro forma financial statements will be filed as an amendment to this Current Report on Form 8-K as soon as practicable, but not later than (60 days after this Current Report on Form 8-K must be filed). (c) Exhibits (2) Plan of Acquisition, reorganization, arrangement, liquidation or succession 2.1 Share Purchase Agreement dated February 29, 2000 between Patricia Kirkham and Dennis Petersen and the Company 2.2 Support Agreement dated February 29, 2000 between the Registrant and Westcor Mortgage Inc. 2.3 Voting Trust and Exchange Agreement dated February 29, 2000 among the Registrant, Westcor Mortgage Inc., Miller Thomson, Patricia Kirkham and Dennis Petersen 2.4 Hypothecation Agreement dated February 29, 2000 among Patricia Kirkham, Dennis Petersen, Westcor Mortgage Inc., Miller Thomson and the Registrant 2.5 Escrow Agreement dated February 29, 2000 among the Registrant, Clark, Wilson, Patricia Kirkham, Dennis Petersen, Oxford Capital Corp. and Westcor Mortgage Inc. ITEM 8. CHANGE IN FISCAL YEAR Not applicable. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. E-FINANCIAL DEPOT.COM, INC. Date: June ______, 2000 /s/ John Huguet ----------------- John Huguet, President and CEO EX-2.1 2 0002.txt SHARE PURCHASE AGREEMENT SHARE PURCHASE AGREEMENT ------------------------ THIS is dated 29th day of February 2000. BETWEEN: PATRICIA KIRKHAM, businesswoman, c/o 204 - 1198 17th Avenue, S.W. Calgary, Alberta, T2T 5R9 and DENNIS PETERSEN, c/o 204 - 1198 17th Avenue, S.W. Calgary, Alberta, T2T 5R9; (herein "Vendors") AND: EFINANCIAL DEPOT.COM, INC., a company incorporated under the laws of Delaware with offices at 150-1875 Century Park East, Century City, California, U.S.A. 90067 (herein "Purchaser") A. The Vendors are the registered and beneficial owners of the Vendors' Voting Shares and the Vendors' Non-voting Shares of the Company; B. Pursuant to a Letter of Intent dated January 25, 2000, effective January 27, 2000, between the Company and the Purchaser, an agreement in principle was reached with respect to the purchase of the Vendors' Voting Shares and other matters; and C. Upon the terms and subject to the conditions set forth in this Agreement, the Vendors have agreed to sell to the Purchaser, and the Purchaser has agreed to purchase, the Vendors' Voting Shares, and the parties have agreed to enter into other related agreements dealing with exchangeable shares. THEREFORE in consideration of the premises and the mutual covenants and agreements herein set forth, the parties hereto covenant and agree each with the other as follows: 1. DEFINITIONS AND INTERPRETATION 1.1 In this Agreement: (a) "Accounts Payable" means all of the trade accounts and other debts and accrued charges owed by the Company as at the Statement Date (other than the Permitted Liens), and which are enumerated and described in the Financial Statements, together with those trade accounts reasonably incurred in the normal and ordinary course of the Business between the Statement Date and the Closing Date, whether the same are due or to become due at or after the Closing Date; (b) "Accounts Receivable" means all of the trade accounts, notes, and other debts arising out of the operation of the Company as at the Closing Date, whether due or to become due as at or after the Closing Date but does not include any amount due to the Company from any shareholder of the Company; (c) "Business Assets" means all of the real property, personal property, choses in action, intangible or intellectual property and all other assets of whatsoever nature owned or leased by the Company, or in which the Company has any right or interest or the right to acquire an interest, including the Accounts Receivable, the Contracts and the assets listed in Schedule "A"; (d) "Closing" means the completion of the transactions contemplated hereby in accordance with the terms hereof; (e) "Closing Date" means the later of the Execution Date and three business days following receipt of all necessary, regulatory approvals to the Closing, or such date as the parties hereto may agree to in writing; (f) "Company" means Westcor Mortgage Inc., a company incorporated under the laws of the Province of Alberta; (g) "Consents" means all the consents, approvals, waivers and other authorizations to the transactions contemplated by this Agreement, all of which are listed in Schedule "N" hereto; (h) "Contracts" means all of the commitments, agreements, contracts, instruments, leases and other documents entered into by the Company, by which the Company is bound or to which the Company or the Business Assets are subject (other than the Permitted Liens) and which are described in Schedule "B"; (i) "Deemed Share Price" shall mean U.S. $4.25; (j) "Escrow Agreement" means the escrow agreement among the Company, the Purchaser, Oxford Capital Corp., and the Purchaser's Solicitors (in their capacity as escrow agent), which is dated February 29, 2000; (k) "Exchangeable Shares" has the meaning ascribed to it in Schedule I attached to the Restated Articles and Articles of Amendment of Westcor Mortgage Inc. as filed with the Alberta Registrar of Corporations on the Closing Date; (l) "Execution Date" means the date of signing of this Agreement; (m) "Excluded Assets" are those assets described in Schedule "M" which the Company possesses or has the use of but does not own and that do not form part of the Business Assets; (n) "Financial Statements" means the audited financial statements of the Company as at its Statement Date, a copy of which is attached as Schedule "C"; (o) "Holdback" means the amount of U.S. $7363.60. (p) "Indebtedness" means any and all advances, debts, duties, endorsements, guarantees, liabilities, obligations, responsibilities and undertakings of a person assumed, created, incurred or made, whether voluntary or involuntary, however arising, whether due or not due, absolute, inchoate or contingent, liquidated or unliquidated, determined or undetermined, direct or indirect, express or implied, and whether such persons may be liable individually or jointly with others; (q) "Intellectual Property" means all, copyrights, copyright registrations and applications, trade names or brand names, Internet domain names, business names, trade-marks, trade-mark registrations and applications, service marks, service mark registrations and applications, trade secrets, proprietary programming information and know-how, patents and patent applications, and other patent rights, processes, technology, software (in both source code and object code format), documentation in relation to software, firmware and other intellectual property, together with all rights under licences, registered user agreements, technology transfer agreements, and other agreements or instruments relating to any of the foregoing, owned by the Company or otherwise used in connection with the Business, including the intellectual property described on Schedule "H"; (r) "Lien" means any mortgage, debenture, charge, hypothecation, pledge, lien, or other security interest or encumbrance of whatever kind or nature, regardless of form and whether consensual or arising by laws, statutory or otherwise that secures the payment of any Indebtedness or the performance of any obligation or creates in favour of or grants to any person any proprietary right; (s) "OTCBB" means the OTC Bulletin Board; (t) "Permitted Liens" means the liens described in Schedule "D". (u) "Purchase Price" means the sum of $600,000 payable in accordance with section 2.2 hereof; (v) "Purchaser's Solicitors" means Clark, Wilson, Barristers and Solicitors; (w) "Statement Date" means January 31, 2000; (x) "Vendors' Voting Shares" means all of the issued and outstanding voting shares in the capital of the Company being 100,000 Class A common shares; (y) "Vendors' Non-voting Shares" means all of the issued and outstanding non-voting shares in the capital of the Company being 360,374 Exchangeable Shares; and (z) "Vendors' Solicitor" means Miller Thomson, Barristers and Solicitors; 1.2 In this Agreement, except as otherwise expressly provided: (a) "Agreement" means this share purchase agreement, including the preamble and the Schedules hereto, as it may from time to time be supplemented or amended and in effect; (b) all references in this Agreement to a designated "Section" or other subdivision or to a Schedule is to the designated Section or other subdivision of, or Schedule to, this Agreement; (c) the words "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision or Schedule; (d) the headings are for convenience only and do not form a part of this Agreement and are not intended to interpret, define, or limit the scope, extent or intent of this Agreement or any provision hereof; (e) the singular of any term includes the plural, and vice versa; the use of any term is equally applicable to any gender and, where applicable, a body corporate; the word "or" is not exclusive; the word "including" means including without limitation or prejudice to the generality of any description, definition, term or phrase preceding that word, and the word "include" and its derivatives will be construed accordingly; the expression "to the knowledge of" or any similar expression as applied to a corporation or individual, refers to, (A) in the case of an individual, the knowledge as at the relevant date that such individual had or would have had had he exercised due diligence in making enquiries in relation to the matter in question from all sources of information likely to provide him with knowledge of same, and (B) in the case of a corporate person, the knowledge (as aforementioned) of a director or officer thereof as at the relevant date; (f) any accounting term not otherwise defined has the meanings assigned to it in accordance with generally accepted accounting principles applicable in Canada; (g) except as otherwise provided, any dollar amount referred to in this Agreement is in the currency of the United States of America; and (h) any other term defined within the text of this Agreement has the meaning so ascribed. 1.3 The following are the Schedules to this Agreement: SCHEDULE DESCRIPTION - -------- ----------- A Business Assets B Contracts C Financial Statements D Permitted Liens E Authorized and Issued Capital F Directors and Officers G Banking Arrangement H Intellectual Property I Contracts Relating to Intellectual Property J Employee List, Income and Benefit Plan K Pension Plan L Litigation M Excluded Assets N Consents O Promissory Note 2. PURCHASE AND SALE 2.1 Upon and subject to the terms and conditions of this Agreement, at the Closing, the Vendors will sell and transfer to the Purchaser, and the Purchaser will purchase from the Vendors all beneficial and legal interest in and to those Vendors' Voting Shares. 2.2 The Purchase Price will be paid on the Closing Date by the payment of an amount in cash equal to U.S. $100,000 and the issuance by the Purchaser of a Promissory Note in the amount of U.S. $492,636.40, substantially the same as the Promissory Note that appears in Schedule "O" (the "Promissory Note"). 2.3 Until the Promissory Note is paid in full, the Vendors' Voting Shares will be subject to a Hypothecation Agreement among the Vendors, the Purchaser and the Company dated February 29, 2000 (the "Hypothecation Agreement"). 2.4 On that date which is the first anniversary of the Closing Date, the Purchaser shall pay to the Vendors in cash or certified cheque, an amount equal to: (a) the Holdback; less (b) the total amount of the Accounts Receivable which have not been paid to the Company by such anniversary date. 3. OTHER AGREEMENTS 3.1 On or before the Execution Date the Vendors will enter into the Escrow Agreement, and the Purchaser will enter into the Escrow Agreement, and the Vendors will take all steps available to them to cause the Company to enter into the Escrow Agreement. 3.2 On or before the Execution Date the Vendors will enter into the Hypothecation Agreement, and the Purchaser will enter into the Hypothecation Agreement, and the Vendors will take all steps available to them to cause the Company to enter into the Hypothecation Agreement. 3.3 On or before the Execution Date the Vendors will take all steps available to them to cause the Company to enter into the following agreements, and the Purchaser will enter into the following agreements: (a) the Support Agreement between the Company and the Purchaser which is dated February 29, 2000; and (b) the Voting Trust and Exchange Agreement among the Company, the Purchaser and the Trustee, which is dated February 29, 2000. 4. ESCROW 4.1 The Vendors' Non-voting Shares will be escrowed in accordance with the terms of the Escrow Agreement. 5. CLOSING 5.1 The Closing will take place on the Closing Date by way of an exchange of documents between solicitors for the Vendors and the solicitors for the Purchaser, or on such other date or in such other manner as the parties agree upon. 6. VENDORS' WARRANTIES AND REPRESENTATIONS 6.1 Each of the Vendors warrants and represents to the Purchaser, with the intent that the Purchaser will rely thereon in entering into this Agreement and in concluding the purchase and sale contemplated herein, that: (a) such Vendor is and will be on the Execution Date, the registered holder and beneficial owner of all of the portion of the Vendors' Voting Shares and the Vendors' Non-voting Shares as follows: (i) Patricia Kirkham 50,000 Class A shares and 150,600 Exchangeable Shares; (ii) Dennis Petersen 50,000 Class A shares and 150,600 Exchangeable Shares; which shares are free and clear of all Liens and such Vendor has no interest, legal or beneficial, direct or indirect, in any shares of, or the assets or business of, the Company other than in the Vendors' Voting Shares and the Vendors' Non-voting Shares; (b) such Vendor has the power and capacity and good and sufficient right and authority to enter into this Agreement on the terms and conditions herein set forth and will on the Closing Date have the rights to transfer the legal and beneficial title and ownership of his or her portion of the Vendors' Voting Shares to the Purchaser; (c) such Vendor does not have any specific information relating to the Company which has not been disclosed to the Purchaser and which if known could reasonably be expected to have a materially adverse effect on the value of the Company, the Vendors' Voting Shares or the Vendors' Non-voting Shares. 6.2 The Vendors warrant and represent to the Purchaser with the intent that the Purchaser will rely thereon in entering into this Agreement and in concluding the purchase and sale contemplated herein, that: (a) the authorized and issued capital of the Company on the Closing Date will be as described in Schedule "E"; (b) no person has any agreement, right, option or privilege, consensual or arising by law, present or future, contingent or absolute, or capable of becoming an agreement, right or option: (i) to require the Company to issue any further or other shares in its capital or any other security convertible or exchangeable into shares in its capital or to convert or exchange any securities into or for shares in the capital of the Company; (ii) for the issue or allotment of any of the authorized but unissued shares in the capital of the Company; (iii) to require the Company to purchase, redeem or otherwise acquire any of the issued and outstanding shares in the capital of the Company; (iv) to purchase or otherwise acquire any shares in the capital of the Company; (v) which is capable of becoming an agreement for the acquisition of any of the Business Assets; (c) the Company is duly incorporated, validly existing and in good standing under the laws of Alberta and is not a reporting issuer in any jurisdiction in Canada; (d) the directors and officers of the Company are identified in Schedule "F"; (e) all alterations to the constating documents of the Company since its incorporation, have been duly approved by the shareholders of the Company properly filed and recorded; (f) the Company now is and has since its incorporation been a "Canadian controlled private corporation" within the meaning of the Income Tax Act (Canada); (g) the Company is duly registered to carry on business in all jurisdictions where its business is currently being conducted; (h) the Company has the power, authority and capacity to carry on the business as presently conducted by it; (i) the Company has the power, authority and capacity to own and use all of the Business Assets; (j) the Company has no bank, trust, savings, chequing or other accounts or deposits, safety deposit boxes or other depositaries except as set out in Schedule "G", which Schedule is a true and complete list showing the name of each bank, trust company or similar financial institution in which the Company has accounts, deposits or safety deposit boxes and the names of all persons authorized to draw thereon or have access thereto; (k) the Company does not own, possess or use any asset other than the Business Assets and does not have any interest in the assets or business of any other person, with the exception of the Excluded Assets; (l) the Company holds all licences and permits required for the conduct in the ordinary course of its business as currently conducted and for the uses to which the Business Assets have been or may be put and all such licences and permits are in good standing and the conduct and uses of the same by the Company is in compliance with all laws, zoning and other bylaws, building and other restrictions, rules, regulations and ordinances applicable to the Company, its business or the Business Assets, and neither the execution and delivery of this Agreement nor the completion of the purchase and sale hereby contemplated will give any person the right to terminate or cancel the said licences or permits or affect such compliance; (m) the making of this Agreement and the completion of the transactions contemplated hereby and the performance of and compliance with the terms hereof does not and will not: (i) conflict with or result in a breach of or violate any of the terms, conditions, or provisions of the constating documents of the Company; (ii) conflict with or result in a breach of or violate any of the terms, conditions or provisions of any law, judgment, order, injunction, decree, regulation or ruling of any court or governmental authority, domestic or foreign, to which the Company or the Vendors are subject or constitute or result in a default under any agreement, contract or commitment to which the Company or the Vendors are a party; (iii) subject to obtaining the Consents, give to any person any remedy, cause of action, right of termination, cancellation or acceleration in or with respect to any agreement, contract, or commitment to which the Company is a party including the Contracts and the Permitted Liens; (iv) give to any government or governmental authority of Canada or any Province of Canada or any regional district, district or municipality or any subdivision thereof, including any governmental department, commission, bureau, board, or administrative agency any right of termination, cancellation, or suspension of, or constitute a breach of or result in a default under any permit, license, control, or authority issued to the Company and which is necessary or desirable in connection with the conduct and operation of the Business and the ownership, leasing or use of the Business Assets; or (v) subject to obtaining the Consents, constitute a default by the Company or an event which, with the giving of notice or lapse of time or both, might constitute an event of default or non-observance under any agreement, contract, indenture or other instrument relating to any Indebtedness of the Company which would give any person the right to accelerate the maturity for the payment of any amount payable under that agreement, contract, indenture, or other instrument including the Contracts and the Permitted Liens; (n) the Financial Statements were prepared in accordance with generally accepted accounting principles applied on a basis consistent with prior reporting periods, are true and correct in every material respect and present fairly and accurately the financial condition and position of the Company as at the Statement Date and the results of the operations of the Company; (o) there is no Indebtedness of the Company which is not disclosed or reflected in the Financial Statements except Accounts Payable; (p) the Company is not subject to any assessment for federal and provincial income tax which has not been satisfied; (q) all tax returns and reports of the Company required by law to be filed prior to the Execution Date (including all federal and provincial income tax returns, Workers' Compensation Board returns, and corporation capital tax returns) have, or will have, as at Closing been filed and are true or will be, complete and correct, and all taxes and other government charges (including all income, excise, sales, business and property taxes and other rates, charges, assessment, levies, duties, taxes, contributions, fees and licenses) have been accrued in the Financial Statements; (r) adequate provision has been made for taxes payable by the Company for which tax returns are not yet required to be filed and there are no agreements, waivers or other arrangements providing for an extension of time with respect to the filing of any tax return by or payment of any tax, governmental charge or deficiency by the Company, and there are no contingent tax liabilities or any grounds which would prompt a re-assessment, including aggressive treatment of income and expenses in filing earlier tax returns; (s) the Company has made all elections required to be made under the Income Tax Act of Canada or other tax legislation in connection with any distributions by the Company and all such elections were true and correct and in the prescribed forms and were made within the prescribed time periods; (t) the Company has not, prior to the Execution Date: (i) made any election under Section 83 or 196 of the Income Tax Act of Canada with respect to payment out of the capital dividend account or life insurance capital dividend account of the Company; (ii) acquired or had the use of any property from a person with whom the Company was not dealing at arm's length, with the exception of Excluded Assets; (iii) disposed of anything to a person with whom the Company was not dealing at arm's length for proceeds less than or greater than the fair market value thereof; or (iv) discontinued carrying on any business in respect of which non-capital losses were incurred; (u) with respect to GST: (i) the Company is registered for GST purposes under the Excise Tax Act (Canada), Part IX; (ii) the Company does not have any deferred obligation or liability under any Section of the Excise Tax Act (Canada) except as described in the Financial Statements in Schedule "C" hereof; (iii) the Company has not, prior to the Execution Date: A. acquired or had the use of any property from a person with whom it was not dealing at arm's length which may give rise to liability to pay GST for which such GST was not paid; or B. disposed of anything to a person with whom the Company was not dealing at arm's length for proceeds less than the fair market value thereof, which may give rise to liability to pay GST; (iv) except as disclosed in the Financial Statements, as of the Execution Date, the Company has remitted to Revenue Canada Customs, Excise and Taxation when required by law to do so all amounts collected by it on account of GST; (v) no authorization, approval, order, license, permit or consent of any governmental authority, regulatory body or court, and no registration, declaration or filing by the Vendors or the Company with any such governmental authority, regulatory body or court is required in order for the Vendors to complete the contemplated purchase and sale, to duly perform and observe the terms and provisions of this Agreement, and to render this Agreement legal, valid, binding and enforceable in accordance with its terms; (w) to the Vendors' knowledge its business as currently conducted and the Business Assets comply with all applicable laws, judgments, decrees, orders, injunctions, rules, statutes and regulations of all courts, arbitrators or governmental authorities, including all environmental, health and safety statutes and regulations; (x) all material transactions of the Company have been promptly and properly recorded or filed in or with its respective books and records, and the minute book of the Company contains all records required to be kept at the "records office" of the Company, as required under applicable corporate law; (y) with respect to the Company's Intellectual Property: (i) Schedule "H" contains a complete and accurate list of all: A. patents and patent applications; B. trade-names, trade-marks and service marks; C. trade-mark applications and service mark applications; D. registered copyrights and copyright applications; E. Internet domain name registrations, owned, used, made or applied for by the Company setting out, in detail, the relevant dates, reference numbers and jurisdictions of each; (ii) the Company has not licensed any of its Intellectual Property to any third party; (iii) Schedule "I" contains a list of each Contract (and amendments thereto) that comprise or relate to the Intellectual Property, including all development agreements, consulting agreements, maintenance agreements, source code escrow agreements, licence agreements and distribution agreements relating thereto; (iv) no claim for release of technology has been made pursuant to any source code escrow agreement or other technology escrow agreement by any third party; (v) the Company is not a party to any technology licence agreement; (vi) the Company is not a party to any technology distribution agreement; (vii) neither the entering into of this Agreement nor the completion of the transactions contemplated hereby constitute or will constitute a breach of any agreement in respect of Intellectual Property; and (viii) no past or present employee, consultant or contractor of the Company has any right, title, or interest in or to any of any Intellectual Property, all such employees, consultants and contractors have or will as at Closing have assigned and waived in writing their rights (including moral rights) in and to the Intellectual Property, and all of the present employees of the Company have or will at Closing have executed and delivered to the Company confidentiality and non-competition agreements in relation to any information or data of the Company obtained in the course of his or her employment or other arrangement with the Company, copies of which agreements have been provided to the Purchaser prior to the Closing Date. (z) the Company is in full compliance with the rules and regulations of the applicable top level domain managers, including the domain managers of the .ca, .com, .net, .gov, and .org top level domains, to maintain its domain name registrations. To the Company's knowledge, there is currently no libelous, scandalous or illegal content in any of the websites maintained by the Company in respect of which any complaint has been received by the Company from any member of the public or from any government or authority or from any top level domain manager; (aa) the Company has not experienced nor, to the knowledge of the Company or the Vendors, has there been any occurrence or event which has had, or might reasonably be expected to have, a materially adverse effect on the Business or the result of its operations; (bb) the Company is not, nor is any employer which is associated, related to or otherwise connected to the Company, a party to any collective agreement relating to the Business with any union, association of employees or bargaining agent, and no part of the Business, or any associated, related or otherwise connected business or the Company, is bound by any such collective agreement or has been certified as a unit appropriate for collective bargaining and there are no proceedings under the Employment Standards Act (Alberta) or any similar legislation or applications for certification which are or could result in an obligation of or be binding upon the Company or any employer which is associated, related to or otherwise connected to the Company and there are no circumstances under which the provisions of the Employment Standards Act (Alberta) can apply to the transactions contemplated by this agreement; (cc) the name of each present employee of the Company, the duration of the employment of each such employee with the Company and the remuneration and benefit obligations of the Company in respect of each such employee is accurately set out in Schedule "J"; and any bonuses payable in the calendar year 1999 have been paid; (dd) the Vendors has not received notice of any complaints filed by any of the Company's employees against the Company and is not aware of any facts or circumstances that may give rise to any complaints claiming that the Company has violated any applicable employee or human rights or similar legislation in jurisdictions in which the business of the Company is conducted or any complaints or proceedings of any kind involving the Company. No levies, assessments and penalties have been made against the Company pursuant to applicable worker's compensation legislation; (ee) there are no pension, profit sharing, incentive, bonus, group insurance or similar plans or other compensation plans affecting the Company other than those described in Schedule "K" and the Company has no unfunded or unpaid liability in respect of any such plan; (ff) except for existing oral and written employment agreements with the individuals listed in Schedule "J", the Company does not have any contract, agreement, undertaking or arrangement, whether oral, written or implied, which cannot be terminated on not more than one month's notice and the Company has no outstanding agreement, contract or commitment (whether written or oral) whatsoever relating to or affecting the conduct of the business of the Company as currently conducted or any of the Business Assets or for the purchase, sale or lease of any of the Business Assets other than the Contracts and the Permitted Liens; (gg) to the best knowledge of the Vendors, there is no basis for and there are no actions, suits, judgments, investigations or proceedings outstanding or pending or to the knowledge of the Vendors threatened against or affecting the Company at law or in equity or before or by any court or federal, provincial, state, municipal or other governmental authority, department, commission, board, tribunal, bureau or agency and the Company is not a party to or threatened with any litigation, with the exception of the matters described in Schedule "L"; (hh) to the Vendors' knowledge the Company: (i) is not in breach of any of the terms, covenants, conditions, or provisions of, is not in default under, and has not done or omitted to do anything which, with the giving of notice or lapse of time or both, would constitute a breach of or a default under any Contract; (ii) is not in violation of nor is any present use by the Company of any Business Assets in violation of or contravention of any applicable law, statute, order, rule or regulation of Canada or any Province of Canada or any regional district, district or municipality or any subdivision thereof; and (iii) is not in breach or default under any judgment, injunction or other order or aware of any judicial, administration, governmental, or other authority or arbitrator by which the Company is bound or to which the Company or any Business Assets are subject; and the Company has not received notice that any default, breach, or violation is being alleged; (ii) the Company has not guaranteed, or agreed to guarantee, any Indebtedness or other obligation of any person except as described in the Financial Statements; (jj) reasonable wear and tear excepted, the Business Assets are in good working order and in a functional state of repair and to the knowledge of the Vendors, there are no latent defects; and (kk) since the applicable Statement Date: (i) no dividends of any kind or other distribution on any shares of the Company has been declared or paid by the Company; (ii) there has been no material adverse change in the financial condition or position of the Company and no damage, loss or destruction materially affecting the Business Assets or the right, capacity, or ability of the Company to carry on the business of the Company as currently conducted; (iii) the Company has not increased the pay of or paid or agreed to pay any pension, bonus, share of profits or other similar benefit to or for the benefit of any agent, employee, director, or officer of the Company, except increases in the normal course of business to employees other than officers and directors; (iv) the Company has conducted its business in the usual and normal manner and has maintained the Business Assets in as good condition as prevailed prior to the Statement Date and has made all necessary repairs and replacements thereto; (v) the Company has not waived or surrendered any right of material value. 7. PURCHASER'S WARRANTIES AND REPRESENTATIONS 7.1 The Purchaser warrants and represents to the Vendors, with the intent that the Vendors will rely thereon in entering into this Agreement and in concluding the purchase and sale contemplated herein that: (a) the Purchaser is a corporation duly incorporated, validly existing and in good standing under the laws of Delaware and has the power, authority and capacity to enter into this Agreement and to carry out its terms; (b) the execution and delivery of this Agreement and the completion of the transactions contemplated hereby has been duly and validly authorized by all necessary corporate action on the part of the Purchaser, and this Agreement constitutes a legal, valid and binding obligation of the Purchaser in accordance with its terms except as limited by laws of general application affecting the rights of creditors; (c) no consent, approval, order or authorization of, or registration, declaration or filing with, any governmental authority is required by or with respect to Purchaser in connection with the execution and delivery of this Agreement by the Purchaser or the consummation by the Purchaser of the transactions contemplated hereby, except for such consents, approvals, orders, authorizations, registrations, declarations, qualifications or filings as may be required by the OTC BB and under applicable federal and state securities laws in connection with the transactions set forth herein; (d) the authorized capital stock of the Purchaser is One Hundred Ten Million (110,000,000) common shares without par value, of which 13,010,000 common shares are issued and outstanding as of the date hereof, fully paid and non-assessable; (e) there is no litigation, proceeding or governmental investigation in progress, pending, threatened or contemplated against or relating to the Purchaser, the business of the Purchaser, or the transactions contemplated by this Agreement; (f) the following documents have been filed under the Purchaser's former name, Ballynagee Acquisition Corp., with the SEC under the Securities Exchange Act and the rules and regulations promulgated thereto: Schedule 14C Information Statement filed October 13, 1999, Form 8K dated September 20, 1999, Pre 14C filed October 1, 1999 and Form 10SB filed July 30, 1999. As of their respective filing dates, the Purchaser's SEC filings complied in all material respects with the Securities Exchange Act, as of their respective filing dates, the Purchaser's SEC filings did not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made therein, in light of the circumstances in which they were made, not misleading; (g) the Purchaser Shares to be issued to the Vendors hereunder on the Closing Date, will be validly issued, fully paid and non-assessable; (h) there are no orders ceasing or suspending trading in the securities of the Purchaser and to the best of the knowledge of the Purchaser, no proceedings for this purpose have been instituted or are pending, contemplated or threatened by any securities regulatory body; and (i) there is no basis for and there are no actions, suits, judgments, investigations or proceedings outstanding or pending or to the knowledge of the Purchaser threatened against or affecting the Purchaser at law or in equity or before or by any court or federal, provincial, state, municipal or other governmental authority, department, commission, board, tribunal, bureau or agency and the Purchaser is not a party to or threatened with any litigation. 8. COVENANTS 8.1 Between the Execution Date and the Closing, the Vendors: (a) will cause the Company to afford to the Purchaser and its authorized representatives access during normal business hours and with reasonable notice to all properties, books, contracts, commitments, records of the Company and furnish such copies (certified if requested) thereof and other information as the Purchaser may reasonably request, and to permit the Purchaser and its authorized representatives to make such audit of the books of account of the Company and physical verification of the Business Assets as the Purchaser may reasonably see fit; (b) will diligently take all reasonable steps to obtain, prior to the Closing, all consents and approvals required to complete the transactions contemplated herein in accordance with the terms and conditions hereof including the Consents; (c) will cause the Company to conduct its business and affairs diligently and only in the ordinary course, and preserve and maintain the goodwill of the Company, the Business Assets and the Company's business; (d) will not permit the Company to make or agree to make any payment to any director, officer, employee or agent of either of the Company except in the ordinary course of business and at the regular rates of salary and commission for such person or as reasonable reimbursement for expenses incurred by such person in connection with either of the Company. 9. NON-MERGER 9.1 The representations, warranties, covenants and agreements of the Vendors contained herein and those contained in the documents and instruments delivered pursuant hereto will be true at and as of the Closing as though made at the Closing and will survive the Closing Date for a period ending 12 months after Closing, and notwithstanding the completion of the transactions herein contemplated, the waiver of any condition contained herein (unless such waiver expressly releases the Vendors of such representation, warranty, covenant or agreement), or any investigation by the Purchaser, the same will remain in full force and effect for the said same 12 month period after Closing and, unless any claim is made by the Purchaser against the Vendors within such period, all liability of the Vendors pursuant to this Agreement will terminate as of the end of such 12 month period. 9.2 The representations, warranties, covenants and agreements of the Purchaser contained herein and those contained in the documents and instruments delivered pursuant hereto will be true at and as of the Closing as though made at the Closing and will survive the Closing Date, and notwithstanding the completion of the transactions herein contemplated, the waiver of any condition contained herein (unless such waiver expressly releases the Purchaser of such representation, warranty, covenant or agreement), or any investigation by the Vendors, the same will remain in full force and effect. 10. CONFIDENTIALITY 10.1 Each party agrees that all information provided to it by another party (collectively "Confidential Information") shall be held in complete confidence by it and by its advisors and representatives and shall not, without the prior written consent of that other party, be disclosed to any other person, nor used for any other purpose, other than in connection with the evaluation, negotiation and finalization of the transactions contemplated herein. However, a party's obligation does not apply to Confidential Information: (a) which is generally available to third parties (unless available as a result of a breach of this Agreement); (b) which is lawfully in the possession of a party and which was not acquired directly or indirectly from another party; or (c) the disclosure of which is required by any applicable law or by any supervisory or regulatory body to whose rules a party is subject. 11. CONDITIONS PRECEDENT 11.1 The obligations of the Purchaser to consummate the transactions herein contemplated are subject to the fulfilment of each of the following conditions at the times stipulated: (a) the representations and warranties of the Vendors contained herein are true and correct in all respects at and as of the Closing except as may be in writing disclosed to and approved by the Purchaser; (b) all covenants, agreements and obligations hereunder on the part of the Vendors to be performed or complied with at or prior to the Closing, including the Vendors' obligation to deliver the documents and instruments herein provided for, have been performed and complied with at and as of the Closing; (c) between the Execution Date and the Closing, the Company has not experienced any event, circumstance or condition or have taken any action or become subject to any action of any character adversely affecting either of the Company or its business or as would materially reduce the value of either of the Company, its business, the Vendors' Voting Shares or the Vendors' Non-voting Shares to the Purchaser; (d) the Business Assets have suffered no material adverse damage or change since the Execution Date and prior to the Closing which, in the sole opinion of the Purchaser acting reasonably, will materially and adversely affect the Business Assets, the Company's business as currently being conducted or the Company's operations, prospects or earnings; (e) on or before the Closing Date, no federal, provincial, regional or municipal government of any country applicable to the Company's business as currently carried on or any agency thereof will have enacted any statute or regulation, announced any policy or taken any action that will materially and adversely affect such business or the Business Assets or the right of the Purchaser to the full enjoyment thereof; 11.2 The conditions set forth in Section 11.1 are for the exclusive benefit of the Purchaser and may be waived by the Purchaser in writing in whole or in part at any time. 11.3 The obligations of the Vendors to consummate the transactions herein contemplated are subject to the fulfilment of each of the following conditions at the times stipulated, that: (a) the representations and warranties of the Purchaser contained herein are true and correct in all material respects at and as of the Closing except as may be in writing disclosed to and approved by the Vendors; (b) all covenants, agreements and obligations hereunder on the part of the Purchaser to be performed or complied with at or prior to the Closing, including in particular the Purchaser's obligations to deliver the documents and instruments herein provided for, have been performed and complied with as at the Closing; and (c) between the Execution Date and the Closing, the Purchaser has not experienced any event, circumstance or condition or have taken any action or become subject to any action of any character adversely affecting the Purchaser or as would materially reduce the value of either of the Purchaser, or the Share Consideration to the Vendors; and (d) on or before the Closing Date, no federal, provincial, regional or municipal government of any country applicable to the Purchaser's business or any agency thereof will have enacted any statute or regulation, announced any policy or taken any action that will materially and adversely affect the Purchaser, its business or its assets. 11.4 The conditions set forth in Section 11.3 are for the exclusive benefit of the Vendors and may be waived by the Vendors in whole or in part at any time. 11.5 The respective obligations of each party to this Agreement to consummate the transactions herein contemplated are subject to the satisfaction at or prior to the Closing of the following conditions: (a) all consents, approvals, authorizations, waivers and orders required or necessary or desirable for the completion of the transactions contemplated herein shall have been obtained or received from regulatory authorities or bodies having jurisdiction in the circumstances; (b) the Vendors shall have entered into employment contracts with the Purchaser on terms satisfactory to them and to Purchaser. 12. TRANSACTIONS OF THE VENDORS AT THE CLOSING 12.1 At the Closing, the Vendors will execute and deliver or cause to be executed and delivered all documents, instruments, resolutions and share certificates as are necessary to effectively implement this Agreement, including to transfer and assign the Vendors' Voting Shares to the Purchaser, free and clear of all Liens, including: (a) certified copies of resolutions of the directors of the Company authorizing the transfer of the Vendors' Voting Shares and the registration of the Vendors' Voting Shares in the name of the Purchaser and authorizing the issue of new share certificates representing the Vendors' Voting Shares in the name of the Purchaser; (b) share certificates representing the Vendors' Voting Shares in the name of the Vendors, duly endorsed for transfer to the Purchaser; (c) duly issued share certificates in the name of the Purchaser representing the Vendors' Voting Shares; (d) resignations in writing of any of the directors and officers and signing officers of the Company as may be requested by the Purchaser; (e) all corporate records and books of account of the Company including, minute books, share register books, share certificate books and annual reports; (f) releases, in form and substance satisfactory to the Purchaser, acting reasonably, executed by the Vendors in favour of the Company releasing the Company from any and all manner of actions, causes of action, suits, proceedings, debts, dues, profits, expenses, contracts, damages, claims, demands and liabilities whatsoever, in law or equity, which the Vendors ever had, now has, or may have against either of the Company for or by reason of any matter, cause or thing whatsoever done or omitted to be done by the Company up to the Closing other than in respect of obligations of the Company to the Vendors arising in respect of: (i) earned but unpaid salary and unpaid benefits for the then current pay period; and (ii) any obligations pursuant to indemnities granted to the Vendors by a Company in connection with their acts as directors of the Company provided that such indemnities shall be ineffective in respect of any act or omission which would constitute a default or breach pursuant to this Agreement or which render any representation or warranty given hereunder untrue or inaccurate; (g) a closing warranty and certificate from the Vendors confirming that the conditions to be satisfied by the Vendors, unless waived, set out in Section 11.1 have been satisfied at the Closing and that all representations and warranties of the Vendors contained in this Agreement are true at and as of the Closing; (h) a certificate from the Vendors confirming the amount of the Accounts Receivable; (i) an opinion of the Vendors' Solicitors addressed to the Purchaser and the Purchaser's Solicitors in a form reasonably satisfactory to the Purchaser's solicitors; (j) all such other documents and instruments as the Purchaser's Solicitors may reasonably require. 13. TRANSACTIONS OF THE PURCHASER AT THE CLOSING 13.1 The Purchaser will deliver the following at the Closing: (a) U.S. $100,000 in cash, certified cheque or solicitor's trust cheque; (b) The Promissory Note; (c) an opinion of the Purchaser's Solicitors addressed to the Vendors and the Vendors' Solicitors in a form reasonably satisfactory to the Vendors' solicitors; and (d) all such other documents and instruments as the Vendors' Solicitors may reasonably require. 14. POST CLOSING AGREEMENTS 14.1 Subject to Section 10.1 herein the Vendors will indemnify and hold harmless the Purchaser from and against: (a) any and all losses, damages or deficiencies resulting from any misrepresentation, breach of warranty or non-fulfilment of any covenant on the part of the Vendors under this Agreement or from any misrepresentation in or omission from any certificate or other instrument furnished or to be furnished to the Purchaser hereunder; (b) any and all actions, suits, proceedings, demands, assessments, judgments, costs and legal and other expenses incidental to any of the foregoing whose cause existed as of the Closing Date; and the Purchaser is hereby authorized to settle such claims and make any payment in relation thereto as the Purchaser reasonably sees fit after consulting and reasonably inquiring of the Vendors, and all moneys so paid or any losses, costs or expenses so incurred by the Purchaser will constitute indebtedness of the Vendors to the Purchaser hereunder. The Purchaser will be entitled to set off against sums owed by the Purchaser to the Vendors hereunder or under any documents delivered hereunder, any amounts owed by the Vendors to the Purchaser hereunder until the sums owed by the Vendors to the Purchaser hereunder are completely set off. 14.2 The Vendors will provide reasonable assistance in preparing and filing all financial statements, tax returns and other documents required by law in respect of any government charges or in respect of any domestic or foreign federal, provincial, municipal, state, territorial or other taxing statute for fiscal periods of the Company ending for tax purposes on or before the time of Closing. 15. TIME OF THE ESSENCE 15.1 Time is of the essence of this Agreement. 16. FURTHER ASSURANCES 16.1 The parties will execute and deliver all such further documents and instruments and do all such acts and things as may be reasonably necessary or required to carry out the full intent and meaning of this Agreement and to effect the transactions contemplated by this Agreement. 17. SUCCESSORS AND ASSIGNS 17.1 This Agreement will enure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and permitted assigns. This Agreement may not be assigned by a party hereto without the prior written consent of the other parties. 18. COUNTERPARTS 18.1 This Agreement may be executed in several counterparts and by fax transmission, each of which will be deemed to be an original and all of which will together constitute one and the same instrument. 19. NOTICE 19.1 Any notice required or permitted to be given under this Agreement will be validly given if in writing and delivered or sent by pre-paid registered mail, to the parties at their addresses first above written or to such other address as any party may specify in writing to the other parties. 19.2 Any notice delivered on a business day will be deemed conclusively to have been effectively given on the date notice was delivered. 19.3 Any notice sent by prepaid registered mail will be deemed conclusively to have been effectively given on the third business day after posting; but if at the time of posting or between the time of posting and the third business day thereafter there is a labour disturbance affecting postal service, then the notice will not be effectively given until actually delivered. 20. AGENTS 20.1 The Vendors covenants to the Purchaser that any compensation due to any agent or other intermediary engaged by the Vendors in connection with the purchase and sale herein contemplated, will be their sole responsibility and will indemnify and hold harmless Purchaser from any liabilities related to such agent or intermediary. 21. ENTIRE AGREEMENT 21.1 This Agreement contains the sole and entire agreement between the parties and any modifications must be in writing and signed by each party. The parties will in good faith investigate and negotiate the most tax effective method of carrying out the intentions of this Agreement. 22. CURRENCY 22.1 All references to monies herein are to United States currency. 23. TENDER 23.1 Tender may be made upon the Vendors or Purchaser or upon the Vendors' Solicitors or Purchaser's Solicitors and money may be tendered by cheque certified by a chartered bank. 24. PROPER LAW 24.1 This Agreement will be governed by and construed in accordance with the laws of Delaware and the parties will attorn to the jurisdictions of the Courts thereof. IN WITNESS WHEREOF the parties have caused this Agreement to be executed effective as of the date first written above. EFINANCIAL DEPOT.COM, INC., by its authorized signatory Per: /s/ John Huguet Name: John Huguet Title: President /s/ Patricia Kirkham PATRICIA KIRKHAM /s/ Dennis Petersen DENNIS PETERSEN SCHEDULE "A" BUSINESS ASSETS - -grey fabric guest chairs x 11 - -grey fabric guest chairs on wheels x 5 - -blue fabric guest chairs x 12 - -blue fabric guest chairs on wheels x 3 - -blue fabric high back executive chairs on wheels x 2 - -light oak wood credenza x 2 - -wood, black vinyl credenza x 1 - -executive oak & black vinyl credenza x 2 - -executive oak & black vinyl 2 pedestal desk x 2 - -light oak L shaped desk/workstation x 1 - -2 pedestal light oak desk x 1 - -1 pedestal light oak desk x 1 - -2 pedestal wood desk x 2 - -2 pedestal wood & metal desk x 1 - -1 pedestal wood & metal desk x 1 - -Large light oak conference room desk x 1 - -2 drawer oak file cabinet x 2 - -2 drawer wood filing cabinet x 1 - -wide 2 drawer black metal filing cabinet x 1 - -2 drawer grey metal filing cabinet x 1 - -wide 3 drawer cream metal filing cabinet x 4 - -wide 5 drawer cream metal filing cabinet x 1 - -2 tier wood shelf unit x 1 - -5 tier wood shelf unit x 1 - -2 tier metal shelf unit x 1 - -light oak end table x 1 - -pictures framed (various) x 25 - -plants hanging x 10 - -potted floor plants x 23 - -grey partition wall x 1 - -plastic trash cans x 11 - -bar fridge serial #CRM2674667 x 1 - -panasonic microwave oven serial #AW633700184 x 1 - -norstar feature set M7310 (telephones) x 9 - -AOC Display Monitor Serial #JCS63414204 x 1 - -Mitsumi keyboard Serial #KPQEA4ZAGA8H1425 x 1 - -PCX - PCU Serial #P6X1205M x 1 - -Hewlett Packard Laser Set Jet Series II printer Serial #2851J47446 x 1 - -IBM Power Typewriter Serial #4L113948 x 1 - -Fellowes paper shredder Serial #040970609A10700276762 x 1 SCHEDULE "B" CONTRACTS Morty Systems Inc. Computers Dated: Feb. 9, 2000 Licence Agreement Newcourt Financial Ltd. Photocopier Dated: July 1, 1999 Lease Agreement: Term 48 mths Quarterly payments of $924.48 Danka Fax machine Dated: Sept. 14, 1998 Lease Agreement: Term 36 mths. Quarterly payments of $315.58 GMAC (Auto) 1998 Cadillac Elderado Dated: Feb. 3, 1998 Lease Agreement: Term 36 mths. Monthly payments of $998.11 Arrowhead Spring Water Water Cooler Dated: Jan. 1994 Rental Agreement Annual payments of $105.93 SCHEDULE "C" FINANCIAL STATEMENTS FINANCIAL STATEMENTS WESTCOR MORTGAGE INC. January 31, 2000 and 1999 (unaudited) and April 30, 1999 (U.S. dollars) SCHEDULE "D" PERMITTED LIENS There is a General Security Agreement placing a charge on the assets of Westcor to secure a revolving operating loan at: Alberta Treasury Branch 239 - 8 Ave. SW Calgary, Alberta T2P 1B9 SCHEDULE "E" AUTHORIZED AND ISSUED CAPITAL Authorized Capital: Unlimited number of Class A shares, Class B shares, Class C shares, and Exchangeable Shares. Issued and Outstanding: 100,000 Class A shares 301,200 Exchangeable Shares SCHEDULE "F" DIRECTORS AND OFFICERS Patricia Kirkham, President and Director Dennis Petersen, Chief Financial Officer SCHEDULE "G" BANKING ARRANGEMENTS General Account is at: Alberta Treasury Branch 239 - 8 Ave SW Calgary, Alberta T2P 1B9 Transit #7609 Account #1046209-25 Trust Account is at: Alberta Treasury Branch 1110 - 17 Ave SW Calgary, Alberta T2T 0B4 Transit #7509 Account #1109456 SCHEDULE "H" INTELLECTUAL PROPERTY A) Patents and Patent Applications: Nil. B) Trade Application #1,033,061 Trade Mark - Westcor Mortgage. C) Service Marks Application dated 2/29/00. Dated: Feb. 29/00, Filed: Feb. 29/00. D) Registered Copyrights and Copyright Application: Nil. E) Internet Domain Registration westcormortgage.com/ Period covered: Dec. 4/98 to Dec. 4/2000. westcormortgage.net Period covered: Oct. 15/99 to Oct. 15/2001. SCHEDULE "I" CONTRACTS RELATING TO INTELLECTUAL PROPERTY Nil SCHEDULE "J" EMPLOYEE LIST AND INCOME Patricia Kirkham Dennis Petersen Position: President/Manager Position: CEO Employed since: April 1992 Employed since: Feb. 1978 Salary: $261,460.00 Salary: $91,000.00 Management Fees: $30,000.00 Ginette LaMarre Debbie Swan Position: Receptionist/Office Clerk Position: Bookkeeper Employed since: June 1994 Employed since: June 1994 Salary: $27,600.00 Salary: $9,499.40 Karen Smith Denise Slaunwhite Position: Funder Position: Funder Employed since: Dec. 1998 Employed since: April 1995 Salary: $36,000.00 Salary: $36,000.00 Bonus: $2,375.00 Bonus: $5,449.00 Carol Stephenson Terry Tessem Position: Sales Representative Position: Sales Representative Employed since: Aug. 1997 Employed since: July 1997 50% commission fees on Finders 50% commission fees on Finders Fees & Brokerage Fees Fees & Brokerage Fees Maxine Cooke Position: Sales Representative Employed since: Feb. 29/00 (previously with Westcor Mar. 1992 - June/97) 50% commission fees on Finders Fees & Brokerage Fees EMPLOYEE BENEFIT PLAN NIL SCHEDULE "K" PENSION PLAN Nil SCHEDULE "L" LITIGATION Nil SCHEDULE "M" EXCLUDED ASSETS Nil SCHEDULE "N" CONSENTS Nil SCHEDULE "O" PROMISSORY NOTE NON-NEGOTIABLE PROMISSORY NOTE For value received, EFinancial Depot.com, Inc. (the "Borrower"), a Delaware corporation, promises to pay to the order of Patricia Kirkham and Dennis Petersen (the "Lenders") at Calgary, Alberta, in lawful money of the United States of America, the principal amount of Four Hundred Ninety-Two Thousand Six Hundred Thirty-Six Dollars Forty Cents ($492,636.40). The Borrower promises to pay to the Lenders the principal amount in the amounts and at the times indicated in the following table: Date Payment Amount ---- -------------- July 1, 2000 $100,000.00 August 1, 2000 $100,000.00 September 1, 2000 $100,000.00 October 1, 2000 $100,000.00 November 1, 2000 $92,636.40 The Borrower shall be entitled to pay at any time the full amount outstanding, or any part thereof without notice, bonus or penalty. In case of default of payment, interest will accrue on the outstanding balance at the rate of 1% per month, and the Lender shall give the Borrower notice of default. The Borrower shall have 10 days from the date of receipt of the notice of default to rectify the default (the "Cure Period"). If the default has not been rectified within the Cure Period, then the entire balance then outstanding together with accrued interest shall, at the option of the Lender, become forthwith due and payable. DATED at ____________________, this _____ day of __________, 2000 EFINANCIAL DEPOT.COM, INC. Per: EX-2.2 3 0003.txt SUPPORT AGREEMENT SUPPORT AGREEMENT THIS AGREEMENT is dated for reference the 29th day of February 2000. BETWEEN: EFINANCIAL DEPOT.COM, INC. (A DELAWARE CORPORATION) 150-1875 Century Park East Century City, California, U.S.A. 90067 (hereinafter referred to as "Pubco") OF THE FIRST PART, - and - WESTCOR MORTGAGE INC. (AN ALBERTA CORPORATION) #204, 1109 - 17th Avenue SW Calgary, Alberta T2T 5R9 (hereinafter referred to as "Westcor") OF THE SECOND PART. WHEREAS pursuant to the provisions of a share purchase agreement between Pubco and the shareholders of Westcor dated for reference February 29, 2000, (hereinafter referred to as the "Share Purchase Agreement") the parties thereto agreed that Pubco and Westcor would deliver this Support Agreement; and, WHEREAS pursuant to the provisions of the Share Purchase Agreement, the shareholders of Westcor represented that the articles of Westcor would authorize an infinite number of Exchangeable Shares having the attributes as set out in the restated articles and articles of amendment of Westcor (the "Exchangeable Share Provisions"); and, WHEREAS the parties hereto wish to provide for and establish a procedure whereby Pubco will take certain actions and make certain payments and deliveries necessary to ensure that Westcor will be able to make certain payments and to deliver or cause to be delivered shares of Pubco Common Stock in satisfaction of the obligations of Westcor under the Exchangeable Share Provisions with respect to the payment and satisfaction of dividends, Liquidation Amounts, Retraction Prices, and Redemption Prices all in accordance with the Exchangeable Share Provisions; NOW THEREFORE in consideration of the respective covenants and agreements provided in this Agreement and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties agree as follows: 1. Definitions and Interpretation (1) Defined Terms. Each term denoted herein by initial capital letters and not otherwise defined herein shall have the meaning attributed thereto in the Exchangeable Share Provisions, unless the context requires otherwise. (2) Interpretation Not Affected by Headings, etc. The division of this Agreement into articles, sections and paragraphs and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Agreement. (3) Number, Gender, etc. Words importing the singular number only shall include the plural and vice versa. Words importing the use of any gender shall include all genders. (4) Date for any Action. If any date on which any action is required to be taken under this Agreement is not a Business Day, such action shall be required to be taken on the next succeeding Business Day. 2. Covenants of Pubco and Westcor (1) Covenants of Pubco Regarding Exchangeable Shares. Pubco covenants and agrees that so long as any Exchangeable Shares are outstanding, it will: (1) not declare or pay any dividend on Pubco Common Stock unless (A) Westcor will have sufficient assets, funds and other property available to enable the due declaration and the due and punctual payment in accordance with applicable law of an equivalent dividend on the Exchangeable Shares and Westcor does simultaneously declare or pay, as the case may be, an equivalent dividend on the Exchangeable Shares, in each case in accordance with the Exchangeable Share Provisions, or (B) it provides the holder of each Exchangeable Share with a benefit that in Pubco's reasonable opinion is equivalent to the dividend on each share of Pubco Common Stock, and it provides a description of this benefit to each holder of Exchangeable Shares 15 days prior to the declaration or payment of any dividend; (2) advise Westcor sufficiently in advance of the declaration by Pubco of any dividend on Pubco Common Stock and take all such other actions as are necessary, in cooperation with Westcor, to ensure that the respective declaration date, record date and payment date for a dividend on the Exchangeable Shares shall be the same as the record date, declaration date and payment date for the corresponding dividend on Pubco Common Stock; (3) ensure that the record date for any dividend declared on Pubco Common Stock is not less than 10 calendar days after the declaration date for such dividend; (4) take all such actions and do all such things as are necessary or desirable to enable and permit Westcor, in accordance with applicable law, to pay and otherwise perform its obligations with respect to the satisfaction of the Liquidation Amount in respect of each issued and outstanding Exchangeable Share upon the liquidation, dissolution or winding-up of Westcor, including without limitation all such actions and all such things as are necessary or desirable to enable and permit Westcor to cause to be delivered shares of Pubco Common Stock to the holders of Exchangeable Shares in accordance with the provisions of Article 3.6 of the Exchangeable Share Provisions; (5) take all such actions and do all such things as are necessary or desirable to enable and permit Westcor, in accordance with applicable law, to pay and otherwise perform its obligations with respect to the satisfaction of the Retraction Price and the Redemption Price, including without limitation all such actions and all such things as are necessary or desirable to enable and permit Westcor to cause to be delivered shares of Pubco Common Stock to the holders of Exchangeable Shares, upon the retraction or redemption of the Exchangeable Shares in accordance with the provisions of Article 3.7 or Article 3.8 of the Exchangeable Share Provisions, as the case may be; and (6) not exercise its vote as a direct or indirect shareholder to initiate the voluntary liquidation, dissolution or winding-up of Westcor nor take any action or omit to take any action that is designed to result in the liquidation, dissolution or winding-up of Westcor. (2) Reservation of Shares of Pubco Common Stock. Pubco hereby represents, warrants and covenants that it has irrevocably reserved for issuance and will at all times keep available, free from preemptive and other rights, out of its authorized and unissued capital stock such number of shares of Pubco Common Stock (or other shares or securities into which Pubco Common Stock may be reclassified or changed as contemplated by section 2(5) hereof) (i) as is equal to the sum of (A) the number of Exchangeable Shares issued and outstanding from time to time and (B) the number of Exchangeable Shares issuable upon the exercise of all rights to acquire Exchangeable Shares outstanding from time to time and (ii) as are now and may hereafter be required to enable and permit Westcor to meet its obligations hereunder, under the Voting Trust and Exchange Agreement, under the Exchangeable Share Provisions and under any other security or commitment pursuant to the Share Purchase Agreement with respect to which Pubco may now or hereafter be required to issue shares of Pubco Common Stock. (3) Notification of Certain Events. In order to assist Pubco to comply with its obligations hereunder, Westcor covenants and agrees to give Pubco notice of each of the following events at the time set forth below: (1) in the event of any determination by the Board of Directors of Westcor to institute voluntary liquidation, dissolution or winding-up proceedings with respect to Westcor or to effect any other distribution of the assets of Westcor among its shareholders for the purpose of winding-up its affairs, at least 60 days prior to the proposed effective date of such liquidation, dissolution, winding-up or other distribution; (2) immediately, upon the earlier of (A) receipt by Westcor of notice of, or (B) Westcor otherwise becoming aware of, any threatened or instituted claim, suit, petition or other proceedings with respect to the involuntary liquidation, dissolution or winding-up of Westcor or to effect any other distribution of the assets of Westcor among its shareholders for the purpose of winding-up its affairs; (3) Immediately, upon receipt by Westcor of a Retraction Request (as defined in the Exchangeable Share Provisions); and, (4) as soon as practicable upon the issuance by Westcor of any Exchangeable Shares or rights to acquire Exchangeable Shares. (4) Delivery of Shares of Pubco Common Stock. In furtherance of its obligations hereunder, upon notice of any event which requires Westcor to cause to be delivered shares of Pubco Common Stock to any holder of Exchangeable Shares, Pubco shall and covenants and agrees to forthwith issue and deliver the requisite shares of Pubco Common Stock to or to the order of the former holder of the surrendered Exchangeable Shares, as Westcor shall direct. All such shares of Pubco Common Stock shall be duly issued as fully paid and non-assessable and shall be free and clear of any lien, claim, encumbrance, security interest or adverse claim. (5) Equivalence. (1) Pubco covenants and agrees that it will not without the prior approval of Westcor and the prior approval of the holders of the Exchangeable Shares given in accordance with Section 3.10(b) of the Exchangeable Share Provisions: (1) issue or distribute shares of Pubco Common Stock (or securities exchangeable for or convertible into or carrying rights to acquire shares of Pubco Common Stock) to the holders of all or substantially all of the then outstanding Pubco Common Stock by way of stock dividend or other distribution; or (2) issue or distribute rights, options or warrants to the holders of all or substantially all of the then outstanding shares of Pubco Common Stock entitling them to subscribe for or to purchase shares of Pubco Common Stock (or securities exchangeable for or convertible into or carrying rights to acquire shares of Pubco Common Stock); or (3) issue or distribute to the holders of all or substantially all of the then outstanding shares of Pubco Common Stock (1) shares or securities of Pubco of any class other than Pubco Common Stock (other than shares convertible into or exchangeable for or carrying rights to acquire shares of Pubco Common Stock), (II) rights, options or warrants other than those referred to in subsection 2 (5) (1) (2) above, (III) evidences of indebtedness of Pubco or (IV) assets of Pubco; unless (4) Westcor is permitted under applicable law to issue or distribute the economic equivalent on a per share basis of such rights, options, securities, shares, evidences of indebtedness or other assets to holders of the Exchangeable Shares; and Westcor shall issue or distribute the economic equivalent on a per share basis of such rights, options, securities, shares, evidences of indebtedness or other assets simultaneously to holders of the Exchangeable Shares; or (5) doing so will not, in the reasonable opinion of Pubco, adversely affect the rights of any holder of Exchangeable Shares, and Pubco provides to each holder of Exchangeable Shares 15 days notice of such intended action. (2) Pubco will not without the prior approval of Westcor and the prior approval of the holders of the Exchangeable Shares given in accordance with Section 3.10(b) of the Exchangeable Share Provisions: (1) subdivide, divide or change the then outstanding shares of Pubco Common Stock into a greater number of shares of Pubco Common Stock; or (2) reduce, combine or consolidate or change the then outstanding shares of Pubco Common Stock into a lesser number of shares of Pubco Common Stock; or (3) reclassify or otherwise change the shares of Pubco Common Stock or effect an amalgamation, merger, reorganization or other transaction affecting the shares of Pubco Common Stock; unless (4) Westcor is permitted under applicable law to simultaneously make the same or an equivalent change to, or in the rights of holders of, the Exchangeable Shares, and the same or an equivalent change is made to, or in the rights of the holders of, the Exchangeable Shares; or (5) doing so will not, in the reasonable opinion of Pubco, adversely affect the rights of any holder of Exchangeable Shares, and Pubco provides to each holder of Exchangeable Shares 15 days notice of such intended action. (3) Pubco will ensure that the record date for any event referred to in section 2(5) (1) or 2 (5) (2) above, or (if no record date is applicable for such event) the effective date for any such event, is not less than 10 calendar days after the date on which such event is declared or announced by Pubco (with simultaneous notice thereof to be given by Pubco to Westcor). (6) Tender Offers, etc. In the event that a tender offer, share exchange offer, issuer bid, take-over bid or similar transaction with respect to Pubco Common Stock (an "Offer") is proposed by Pubco or is proposed to Pubco or its shareholders and is recommended by the Board of Directors of Pubco, or is otherwise effected or to be effected with the consent or approval of the Board of Directors of Pubco, Pubco shall take all such actions and do all such things as are necessary or desirable to enable and permit holders of Exchangeable Shares to participate in such Offer to the same extent and on an equivalent basis as the holders of shares of Pubco Common Stock, without discrimination, including, without limiting the generality of the foregoing, Pubco will use its good faith efforts expeditiously to (and shall, in the case of a transaction proposed by Pubco or where Pubco is a participant in the negotiation thereof) ensure that holders of Exchangeable Shares may participate in all such Offers without being required to retract Exchangeable Shares as against Westcor (or, if so required, to ensure that any such retraction shall be effective only upon, and shall be conditional upon, the closing of the Offer and only to the extent necessary to tender or deposit to the Offer). (7) Ownership of Outstanding Shares. Without the prior approval of Westcor and the prior approval of the holders of the Exchangeable Shares given in accordance with Section 3.10(b) of the Exchangeable Share Provisions, Pubco covenants and agrees in favour of Westcor that, as long as any outstanding Exchangeable Shares are owned by any person or entity other than Pubco or any of its Subsidiaries, Pubco will be and remain the direct or indirect beneficial owner of all issued and outstanding shares in the capital of Westcor and all outstanding securities of Westcor carrying or otherwise entitled to voting rights in any circumstances, in each case other than the Exchangeable Shares, unless not being and remaining so will not, in the reasonable opinion of Pubco, adversely affect the rights of any holder of Exchangeable Shares, and Pubco has provided to each holder of Exchangeable Shares 15 days notice of Pubco's intention to no longer be or remain the direct or indirect beneficial owner of all issued and outstanding shares in the capital of Westcor carrying and all outstanding securities of Westcor or otherwise entitled to voting rights in any circumstances, in each case other than the Exchangeable Shares. (8) Pubco Not to Vote Exchangeable Shares. Pubco covenants and agrees that it will appoint and cause to be appointed proxyholders with respect to all Exchangeable Shares held by Pubco and its Subsidiaries for the sole purpose of attending each meeting of holders of Exchangeable Shares in order to be counted as part of the quorum for each such meeting. Pubco further covenants and agrees that it will not, and will cause its Subsidiaries not to, exercise any voting rights which may be exercisable by holders of Exchangeable Shares from time to time pursuant to the Exchangeable Share Provisions or pursuant to the provisions of any corporate statute by which Westcor may be governed with respect to any Exchangeable Shares held by it or by its Subsidiaries in respect of any matter considered at any meeting of holders of Exchangeable Shares. (9) Due Performance. On and after the Effective Date, Pubco shall duly and timely perform all of its obligations provided for under the Share Purchase Agreement, this agreement and all of the agreements to which it is a party in connection with the transactions contemplated under the Share Purchase Agreement including any obligations that may arise upon the exercise of Pubco's rights under the Exchangeable Share Provisions. 3. General (1) Term. This Agreement shall come into force and be effective as of the date hereof and shall terminate and be of no further force and effect at such time as no Exchangeable Shares (or securities or rights convertible into or exchangeable for or carrying rights to acquire Exchangeable Shares) are held by any party other than Pubco and any of its Subsidiaries. (2) Changes in Capital of Pubco and Westcor. Notwithstanding the provisions of section 3 (4) hereof, at all times after the occurrence of any event effected pursuant to section 2 (5) or 2 (6) hereof, as a result of which either Pubco Common Stock or the Exchangeable Shares or both are in any way changed, this Agreement shall forthwith be amended and modified as necessary in order that it shall apply with full force and effect, mutatis mutandis, to all new securities into which Pubco Common Stock or the Exchangeable Shares or both are so changed and the parties hereto shall execute and deliver an agreement in writing giving effect to and evidencing such necessary amendments and modifications. (3) Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality or enforceability of the remainder of this Agreement shall not in any way be affected or impaired thereby and this Agreement shall be carried out as nearly as possible in accordance with its original terms and conditions. (4) Amendments, Modifications, etc. This Agreement may not be amended or modified except by an agreement in writing executed by Westcor and Pubco and approved by the holders of the Exchangeable Shares in accordance with Section 3.10(b) of the Exchangeable Share Provisions. (5) Ministerial Amendments. Notwithstanding the provisions of section 3(4), the parties to this Agreement may in writing, at any time and from time to time, without the approval of the holders of the Exchangeable Shares, amend or modify this Agreement for the purposes of. (1) adding to the covenants of either or both parties for the protection of the holders of the Exchangeable Shares; (2) making such amendments or modifications not inconsistent with this Agreement as may be necessary or desirable with respect to matters or questions which, in the opinion of the board of directors of each of Westcor and Pubco, it may be expedient to make, provided that each such board of directors shall be of the opinion that such amendments or modifications will not be prejudicial to the interests of the holders of the Exchangeable Shares; or (3) making such changes or corrections which, on the advice of counsel to Westcor and Pubco, are required for the purpose of curing or correcting any ambiguity or defect or inconsistent provision or clerical omission or mistake or manifest error, provided that the boards of directors of each of Westcor and Pubco shall be of the opinion that such changes or corrections will not be prejudicial to the interests of the holders of the Exchangeable Shares. (6) Meeting to Consider Amendments. Westcor, at the request of Pubco, shall call a meeting or meetings of the holders of the Exchangeable Shares for the purpose of considering any proposed amendment or modification requiring approval of such shareholders. Any such meeting or meetings shall be called and held in accordance with the by-laws of Westcor, the Exchangeable Share Provisions and all applicable laws. (7) Amendments Only in Writing. No amendment to or modification or waiver of any of the provisions of this Agreement otherwise permitted hereunder shall be effective unless made in writing and signed by both of the parties hereto. (8) Enurement. This Agreement shall be binding upon and enure to the benefit of the parties hereto and the holders, from time to time, of Exchangeable Shares and each of their respective heirs, successors and assigns. (9) Notices to Parties. All notices and other communications between the parties shall be in writing and shall be deemed to have been given if delivered personally or by confirmed telecopy to the parties at the following addresses (or at such other address for either such party as shall be specified in like notice): (1) if to Pubco at: EFinancial Depot.com, Inc. (a Delaware corporation) 150-1875 Century Park East Century City, California, U.S.A. 90067 Attention: President Fax: 604-681-3652 (2) if to Westcor at: Westcor Mortgage Inc. #204, 1109 - 17th Avenue SW Calgary, Alberta T2T 5R9 Attention: President Fax: 403.228.7101 Any notice or other communication given personally shall be deemed to have been given and received upon delivery thereof and if given by telecopy shall be deemed to have been given and received on the date of confirmed receipt thereof unless such day is not a Business Day in which case it shall be deemed to have been given and received upon the immediately following Business Day. (10) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument. (11) Jurisdiction. This Agreement shall be construed and enforced in accordance with the laws of the Province of Alberta and the laws of Canada applicable therein. (12) Recitals. The recitals form part of this agreement. (13) Attornment. Pubco agrees that any action or proceeding arising out of or relating to this Agreement may be instituted in the courts of Alberta, waives any objection which it may have now or hereafter to the venue of any such action or proceeding, irrevocably submits to the jurisdiction of the said courts in any such action or proceeding, agrees to be bound by any judgment of the said courts and not to seek, and hereby waives, any review of the merits of any such judgment by the courts of any other jurisdiction and hereby appoints Westcor at its registered office in the Province of Alberta as Pubco's attorney for service of process. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to take effect as of the date first above written. E-FINANCIAL DEPOT.COM, INC. (A DELAWARE CORPORATION) Per: /s/ John Huguet WESTCOR MORTGAGE INC. Per: /s/ Patricia Kirkham EX-2.3 4 0004.txt VOTING TRUST AND EXCHANGE AGREEMENT VOTING TRUST AND EXCHANGE AGREEMENT THIS AGREEMENT is dated for reference the 29th day of February 2000. AMONG: EFINANCIAL DEPOT.COM, INC. 150-1875 Century Park East Century City, California, U.S.A. 90067 (hereinafter referred to as "Pubco") OF THE FIRST PART WESTCOR MORTGAGE INC. #204, 1109 - 17th Avenue, S.W. Calgary, Alberta T2T 5R9 (hereinafter referred to as "Westcor'') OF THE SECOND PART MILLER THOMSON Barristers and Solicitors 3000, 700-9th Avenue S.W. Calgary, Alberta T2P 3V4 (hereinafter referred to as the "Trustee'') OF THE THIRD PART PATRICIA KIRKHAM c/o #204, 1109 - 17th Avenue, S.W., Calgary, Alberta, T2T 5R9 and DENNIS PETERSEN c/o #204, 1109 - 17th Avenue, S.W., Calgary, Alberta, T2T 5R9 (hereinafter referred to as the "Vendors'') OF THE FOURTH PART WHEREAS pursuant to the provisions of a share purchase agreement between Pubco and the shareholders of Westcor dated for reference February 29, 2000 (hereinafter referred to as the "Share Purchase Agreement") the parties thereto agree that Pubco and Westcor would enter into this Voting Trust and Exchange Agreement; and WHEREAS pursuant to the provisions of the Share Purchase Agreement the shareholders of Westcor represented that the articles of Westcor will authorize an unlimited number of Exchangeable Shares having the attributes as set out in the Restated Articles and Articles of Amendment of Westcor (the "Exchangeable Share Provisions"); and WHEREAS Pubco agreed to provide voting rights in Pubco to each holder (other than Pubco and its Subsidiaries) from time to time of Exchangeable Shares, such voting rights per Exchangeable Share to be equivalent to the voting rights per share of Pubco Common Stock (the "Pubco Common Stock''); and WHEREAS Pubco is to grant to and in favour of the holders (other than Pubco and its Subsidiaries) from time to time of Exchangeable Shares the right, in the circumstances set forth herein, to require Pubco to purchase from each such holder all or any part of the Exchangeable Shares held by the holder; and WHEREAS the parties desire to make appropriate provision and to establish a procedure whereby voting rights in Pubco shall be exercisable by holders (other than Pubco and its Subsidiaries) from time to time of Exchangeable Shares by and through the Trustee, which will hold legal title to one (1) share of Pubco Special Preferred Voting Stock (the "Pubco Special Voting Stock") to which voting rights attach for the benefit of such holders and whereby the rights to require Pubco to purchase Exchangeable Shares from the holders thereof (other than Pubco and its Subsidiaries) shall be exercisable by such holders from time to time of Exchangeable Shares by and through the Trustee, which will hold legal title to such rights for the benefit of such holders; and WHEREAS these recitals and any statements of fact in this Agreement are made by Pubco and Westcor and not by the Trustee; NOW THEREFORE in consideration of the respective covenants and agreements provided in this Agreement and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties agree as follows: 1. DEFINITIONS AND INTERPRETATION (a) Definitions. In this Agreement, the following terms shall have the following meanings: "Aggregate Equivalent Vote Amount" means, with respect to any matter, proposition or question on which holders of Pubco Common Stock are entitled to vote, consent or otherwise act, the product of (i) the number of shares of Exchangeable Shares issued and outstanding and held by Holders multiplied by (ii) the Equivalent Vote Amount. "Automatic Exchange Rights" means the benefit of the obligation of Pubco to effect the automatic exchange of shares of Pubco Common Stock for Exchangeable Shares pursuant to Section 5 (k) hereof. "Board of Directors" means the Board of Directors of Westcor. "Business Day" has the meaning attributed thereto in the Exchangeable Share Provisions. "Equivalent Vote Amount" means, with respect to any matter, proposition or question on which holders of Pubco Common Stock are entitled to vote, consent or otherwise act, the number of votes to which a holder of one share of Pubco Common Stock is entitled with respect to such matter, proposition or question. "Exchange Right" has the meaning attributed thereto in Article 5 hereof. "Exchangeable Share Consideration" has the meaning attributed thereto in the Exchangeable Share Provisions. "Exchangeable Share Price" has the meaning attributed thereto in the Exchangeable Share Provisions. "Exchangeable Share Provisions" has the meaning attributed thereto in the recitals hereto. "Exchangeable Shares" has the meaning attributed thereto in the recitals hereto. "Holder Votes" has the meaning attributed thereto in Section 4(b) hereof. "Holders" means the registered holders from time to time of Exchangeable Shares, other than Pubco and its Subsidiaries. "Insolvency Event" means the institution by Westcor of any proceeding to be adjudicated a bankrupt or insolvent or to be dissolved or wound-up, or the consent of Westcor to the institution of bankruptcy, insolvency, dissolution or winding-up proceedings against it, or the filing of a petition, answer or consent seeking dissolution or winding-up under any bankruptcy, insolvency or analogous laws, including without limitation the Companies' Creditors' Arrangement Act (Canada) and the Bankruptcy and Insolvency Act (Canada), and the failure by Westcor to contest in good faith any such proceedings commenced in respect of Westcor within 15 days of becoming aware thereof, or the consent by Westcor to the filing of any such petition or to the appointment of a receiver, or the making by Westcor of a general assignment for the benefit of creditors, or the admission in writing by Westcor of its inability to pay its debts generally as they become due, or Westcor not being permitted, pursuant to liquidity or solvency requirements of applicable law, to redeem any Retracted Shares pursuant to Section 3.7(f) of the Exchangeable Share Provisions. "Liquidation Call Right" has the meaning attributed thereto in the Exchangeable Share Provisions. "Liquidation Event" has the meaning attributed thereto in subsection 5(k)(ii) hereof. "Liquidation Event Effective Time" has the meaning attributed thereto in subsection 5 (k) (iii) hereof. "List" has the meaning attributed thereto in Section 4(f) hereof. "Officers' Certificate" means, with respect to Pubco or Westcor, as the case may be, a certificate signed by any two of the Chairman of the Board, the Vice-Chairman of the Board, the President, any Vice-President or any other senior officer of Pubco or Westcor, as the case may be. "Person" includes an individual, partnership, corporation, company, unincorporated syndicate or organization, trust, trustee, executor, administrator and other legal representative. "Pubco Common Stock" has the meaning attributed thereto in the recitals hereto. "Pubco Consent" has the meaning attributed thereto in Section 4(b) hereof. "Pubco Meeting" has the meaning attributed thereto in Section 4(b) hereof. "Pubco Special Voting Stock" has the meaning attributed thereto in the recitals hereto. "Pubco Successor" has the meaning attributed thereto in subsection 11 (a) hereof. "Redemption Call Right" has the meaning attributed thereto in the Exchangeable Share Provisions. "Retracted Shares" has the meaning attributed thereto in Section 5(g) hereof. "Retraction Call Right" has the meaning attributed thereto in the Exchangeable Share Provisions. "Share Purchase Agreement" has the meaning attributed thereto in the recitals hereof. "Subsidiary" has the meaning attributed thereto in the Exchangeable Share Provisions. "Support Agreement" means that certain support agreement made as of even date hereof between Westcor and Pubco. "Trust" means the trust created by this Agreement. "Trust Estate" means the Voting Share, any other securities, the Exchange Right, the Automatic Exchange Rights and any money or other property which may be held by the Trustee from time to time pursuant to this Agreement. "Trustee" means Miller Thomson and, subject to the provisions of Article 10 hereof, includes any successor trustee or permitted assigns. "Voting Rights" means the voting rights attached to the Voting Share. "Voting Share" means the one (1) share of Pubco Special Voting Stock, U.S. $1.00 par value, issued by Pubco to and deposited with the Trustee, which entitles the holder of record to a number of votes at meetings of holders of Pubco Common Stock equal to the Aggregate Equivalent Vote Amount. (b) Interpretation Not Affected by Headings, etc. The division of this Agreement into articles, sections and paragraphs and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Agreement. (c) Number, Gender, etc. Words importing the singular number only shall include the plural and vice versa. Words importing the use of any gender shall include all genders. (d) Date for any Action. If any date on which any action is required to be taken under this Agreement is not a Business Day, such action shall be required to be taken on the next succeeding Business Day. 2. PURPOSE OF AGREEMENT The purpose of this Agreement is to create the Trust for the benefit of the Holders, as herein provided. The Trustee will hold the Voting Share in order to enable the Trustee to exercise the Voting Rights and will hold the Exchange Right and the Automatic Exchange Rights in order to enable the Trustee to exercise such rights, in each case as Trustee for and on behalf of the Holders as provided in this Agreement. The Trust is hereby constituted on February 29, 2000, by the granting of the Exchange Rights and Automatic Exchange Rights to the Trustee notwithstanding that the Voting Share entitling the Trustee to Voting Rights is delivered after the date hereof. 3. VOTING SHARE (a) Issuance and Ownership of the Voting Share. Immediately following approval by the Shareholders of the creation and issuance of the Voting Share, Pubco shall issue to and deposit with the Trustee the Voting Share to be hereafter held of record by the Trustee as trustee for and on behalf of, and for the use and benefit of the Holders and in accordance with the provisions of this Agreement in consideration for the payment by the Trustee of $1.00 (the receipt and sufficiency of which is hereby acknowledged) for and on behalf of the Holders. During the term of the Trust and subject to the terms and conditions of this Agreement, the Trustee shall possess and be vested with full legal ownership of the Voting Share and shall be entitled to exercise all of the rights and powers of an owner with respect to the Voting Share, provided that the Trustee shall: (i) hold the Voting Share and the legal title thereto as trustee solely for the use and benefit of the Holders in accordance with the provisions of this Agreement; and (ii) except as specifically authorized by this Agreement, have no power or authority to sell, transfer, vote or otherwise deal in or with the Voting Share and the Voting Share shall not be used or disposed of by the Trustee for any purpose other than the purposes for which this Trust is created pursuant to this Agreement. (b) Legended Share Certificates. Westcor will cause each certificate representing Exchangeable Shares to bear an appropriate legend notifying the Holders of their right to instruct the Trustee with respect to the exercise of the Voting Rights with respect to the Exchangeable Shares held by a Holder. (c) Safe Keeping of Certificate. The certificate representing the Voting Share shall at all times be held in safe keeping by the Trustee or its agent. 4. EXERCISE OF VOTING RIGHTS (a) Voting Rights. The Trustee, as the holder of record of the Voting Share, shall be entitled to all of the Voting Rights, including the right to consent to or to vote in person or by proxy the Voting Share, on any matter, question or proposition whatsoever that may properly come before the stockholders of Pubco at a Pubco Meeting or in connection with a Pubco Consent (in each case, as hereinafter defined). The Voting Rights shall be and remain vested in and exercised by the Trustee. Subject to Section 7(m) hereof, the Trustee shall exercise the Voting Rights only on the basis of instructions received pursuant to this Article 4 from Holders entitled to instruct the Trustee as to the voting thereof at the time at which a Pubco Consent is sought or a Pubco Meeting is held. To the extent that no instructions are received from a Holder with respect to the Voting Rights to which such Holder is entitled, the Trustee shall not exercise or permit the exercise of such Holder's Vote. (b) Number of Votes. With respect to all meetings of stockholders of Pubco at which holders of shares of Pubco Common Stock are entitled to vote (a "Pubco Meeting") and with respect to all written consents sought by Pubco from its stockholders including the holders of shares of Pubco Common Stock (a "Pubco Consent"), each Holder shall be entitled to instruct the Trustee to cast and exercise, in the manner instructed, a number of votes equal to the Equivalent Vote Amount for each Exchangeable Share owned of record by such Holder on the record date established by Pubco or by applicable law for such Pubco Meeting or Pubco Consent, as the case may be (the "Holder Votes" ) in respect of each matter, question or proposition to be voted on at such Pubco Meeting or to be consented to in connection with such Pubco Consent. (c) Mailings to Shareholders. With respect to each Pubco Meeting and Pubco Consent, the Trustee will mail or cause to be mailed (or otherwise communicate in the same manner as Pubco utilizes in communications to holders of Pubco Common Stock, subject to the Trustee's ability to provide this method of communication and upon being advised in writing of such method) to each of the Holders named in the List on the same day as the initial mailing or notice (or other communication) with respect thereto is given by Pubco to its stockholders: (i) a copy of such notice, together with any proxy or information statement and related materials to be provided to stockholders of Pubco; (ii) a statement that such Holder is entitled to instruct the Trustee as to the exercise of the Holder Votes with respect to such Pubco Meeting or Pubco Consent, as the case may be, or, pursuant to Section 4(g) hereof, to attend such Pubco Meeting and to exercise personally the Holder Votes thereat; (iii) a statement as to the manner in which such instructions may be given to the Trustee, including an express indication that instructions may be given to the Trustee to give: (A) a proxy to such Holder or his designee to exercise personally the Holder Votes; or (B) a proxy to a designated agent or other representative of the management of Pubco to exercise such Holder Votes; (iv) a statement that if no such instructions are received from the Holder, the Holder Votes to which such Holder is entitled will not be exercised; (v) a form of direction whereby the Holder may so direct and instruct the Trustee as contemplated herein; and (vi) a statement of (A) the time and date by which such instructions must be received by the Trustee in order to be binding upon it, which in the case of a Pubco Meeting shall not be later than the close of business on the Business Day prior to such meeting, and (B) the method for revoking or amending such instructions. The materials referred to above are to be provided by Pubco to the Trustee, but shall be subject to review and comment by the Trustee. For the purpose of determining Holder Votes to which a Holder is entitled in respect of any such Pubco Meeting or Pubco Consent, the number of Exchangeable Shares owned of record by the Holder shall be determined at the close of business on the record date established by Pubco or by applicable law for purposes of determining stockholders entitled to vote at such Pubco Meeting or to give written consent in connection with such Pubco Consent. Pubco will notify the Trustee in writing of any decision of the board of directors of Pubco with respect to the calling of any such Pubco Meeting or the seeking of any such Pubco Consent and shall provide all necessary information and materials to the Trustee in each case promptly and in any event in sufficient time to enable the Trustee to perform its obligations contemplated by this Section 4(c). (d) Copies of Stockholder Information. Pubco will deliver to the Trustee copies of all proxy materials (including notices of Pubco Meetings but excluding proxies to vote shares of Pubco Common Stock), information statements, reports (including without limitation all interim and annual financial statements) and other written communications that are to be distributed from time to time to holders of Pubco Common Stock in sufficient quantities and in sufficient time so as to enable the Trustee to send those materials to each Holder at the same time as such materials are first sent to holders of Pubco Common Stock. The Trustee will mail or otherwise send to each Holder, at the expense of Pubco, copies of all such materials (and all materials specifically directed to the Holders or to the Trustee for the benefit of the Holders by Pubco) received by the Trustee from Pubco at the same time as such materials are first sent to holders of Pubco Common Stock. The Trustee will make copies of all such materials available for inspection by any Holder at the office of the Trustee in the city of Calgary. (e) Other Materials. Immediately after receipt by Pubco or any stockholder of Pubco of any material sent or given generally to the holders of Pubco Common Stock by or on behalf of a third party, including without limitation dissident proxy and information circulars (and related information and material) and tender and exchange offer circulars (and related information and material), Pubco shall use its best efforts to obtain and deliver to the Trustee copies thereof in sufficient quantities so as to enable the Trustee to forward such material (unless the same has been provided directly to Holders by such third party) to each Holder as soon as possible thereafter. As soon as practicable after receipt thereof, the Trustee will mail or otherwise send to each Holder, at the expense of Pubco, copies of all such materials received by the Trustee from Pubco. The Trustee will also make copies of all such materials available for inspection by any Holder at the office of the Trustee in the city of Edmonton. (f) List of Persons Entitled to Vote. Westcor shall, (i) prior to each annual, general and special Pubco Meeting or the seeking of any Pubco Consent and (ii) forthwith upon each request made at any time by the Trustee in writing, prepare or cause to be prepared a list (a "List") of the names and addresses of the Holders arranged in alphabetical order and showing the number of Exchangeable Shares held of record by each such Holder, in each case at the close of business on the date specified by the Trustee in such request or, in the case of a List prepared in connection with a Pubco Meeting or a Pubco Consent, at the close of business on the record date established by Pubco or pursuant to applicable law for determining the holders of Pubco Common Stock entitled to receive notice of and/or to vote at such Pubco Meeting or to give consent in connection with such Pubco Consent. Each such List shall be delivered to the Trustee promptly after receipt by Westcor of such request or the record date for such meeting or seeking of consent, as the case may be, and in any event within sufficient time as to enable the Trustee to perform its obligations under this Agreement. Pubco agrees to give Westcor written notice (with a copy to the Trustee) of the calling of any Pubco Meeting or the seeking of any Pubco Consent together with the record dates therefor, sufficiently prior to the date of the calling of such meeting or seeking of such consent so as to enable Westcor to perform its obligations under this Section 4(f). (g) Entitlement to Direct Votes. Any Holder named in a List prepared in connection with any Pubco Meeting or any Pubco Consent will be entitled (i) to instruct the Trustee in the manner described in Section 4(c) hereof with respect to the exercise of the Holder Votes to which such Holder is entitled or (ii) to attend such meeting and personally to exercise thereat (or to exercise with respect to any written consent), as the proxy of the Trustee, the Holder Votes to which such Holder is entitled. (h) Stockholder Proposals. The Trustee shall forthwith submit to Pubco any stockholder proposal (within the meaning of the United States Securities Exchange Act of 1934) received by the Trustee from a Holder. Such stockholder proposal may be considered at any meeting of Pubco at which the holders of Pubco Common Stock are entitled to submit stockholder proposals. Pubco agrees to receive all stockholder proposals submitted by the Trustee that are received by Pubco within the applicable time limitation under the United States Securities Exchange Act of 1934, provided that not more than one proposal is submitted on behalf of any one Holder. (i) Voting by Trustee, and Attendance of Trustee Representative, at Meeting. (ii) In connection with each Pubco Meeting and Pubco Consent, the Trustee shall exercise, either in person or by proxy, in accordance with the instructions received from a Holder pursuant to Section 4(c) hereof, the Holder Votes as to which such Holder is entitled to direct the vote (or any lesser number thereof as may be set forth in the instructions); provided, however, that such written instructions are received by the Trustee from the Holder prior to the time and date fixed by it for receipt of such instructions in the notice given by the Trustee to the Holder pursuant to Section 4(c) hereof. (iii) The Trustee shall cause such representatives as are empowered by it to sign and deliver, on behalf of the Trustee, proxies for Voting Rights to attend each Pubco Meeting. Upon submission by a Holder (or its designee) of identification satisfactory to the Trustee's representatives, and at the Holder's request, such representatives shall sign and deliver to such Holder (or its designee) a proxy to exercise personally the Holder Votes as to which such Holder is otherwise entitled hereunder to direct the vote, if such Holder either (A) has not previously given the Trustee instructions pursuant to Section 4(c) hereof in respect of such meeting, or (B) submits to the Trustee's representatives written revocation of any such previous instructions. At such meeting, the Holder exercising such Holder Votes shall have the same rights as the Trustee to speak at the meeting in respect of any matter, question or proposition, to vote by way of ballot at the meeting in respect of any matter, question or proposition and to vote at such meeting by way of a show of hands in respect of any matter, question or proposition. (i) Distribution of Written Materials. Any written materials to be distributed by the Trustee to the Holders pursuant to this Agreement shall be delivered or sent by mail (or otherwise communicated in the same manner as Pubco utilizes in communications to holders of Pubco Common Stock) to each Holder at its address as shown on the books of Westcor. Westcor shall provide or cause to be provided to the Trustee for this purpose, on a timely basis and without charge or other expense: (A) current lists of the Holders; and (B) upon the request of the Trustee, mailing labels to enable the Trustee to carry out its duties under this Agreement. The materials referred to above are to be provided by Pubco to the Trustee, but shall be subject to review and comment by the Trustee. (j) Termination of Voting Right. Except as otherwise provided herein or in the Exchangeable Share Provisions, all of the rights of a Holder with respect to the Holder Votes exercisable in respect of the Exchangeable Shares held by such Holder, including the right to instruct the Trustee as to the voting of or to vote personally such Holder Votes and including the right to submit a stockholder proposal to the Trustee in accordance with Section 4(h) hereof, shall be deemed to be surrendered by the Holder to Pubco and such Holder Votes and the Voting Rights represented thereby shall cease immediately upon the delivery by such Holder to the Trustee of the certificates representing such Exchangeable Shares in connection with the exercise by the Holder of the Exchange Right or the occurrence of the automatic exchange of Exchangeable Shares for shares of Pubco Common Stock, as specified in Article 5 hereof (unless in either case Pubco shall not have delivered the Exchangeable Share Consideration deliverable in exchange therefor to the Trustee for delivery to the Holders), or upon the redemption of Exchangeable Shares pursuant to Article 3.7 or Article 3.8 of the Exchangeable Share Provisions, or upon the effective date of the liquidation, dissolution or winding-up of Westcor pursuant to Article 3.6 of the Exchangeable Share Provisions, or upon the purchase of Exchangeable Shares from the holder thereof by Pubco pursuant to the exercise by Pubco of the Retraction Call Right, the Redemption Call Right or the Liquidation Call Right. 5. EXCHANGE RIGHT AND AUTOMATIC EXCHANGE (a) Grant and Ownership of the Exchange Right. Pubco hereby grants to the Trustee as trustee for and on behalf of, and for the use and benefit of, the Holders (i) the right (the "Exchange Right"), upon the occurrence and during the continuance of an Insolvency Event, to require Pubco to purchase from each or any Holder all or any part of the Exchangeable Shares held by such Holders, and (ii) the Automatic Exchange Rights, all in accordance with the provisions of this Agreement. Pubco hereby acknowledges receipt from the Trustee as trustee for and on behalf of the Holders of good and valuable consideration (and the adequacy thereof) for the grant of the Exchange Right and the Automatic Exchange Rights by Pubco to the Trustee. During the term of the Trust and subject to the terms and conditions of this Agreement, the Trustee shall possess and be vested with full legal ownership of the Exchange Right and the Automatic Exchange Rights and shall be entitled to exercise all of the rights and powers of an owner with respect to the Exchange Right and the Automatic Exchange Rights, provided that the Trustee shall: (i) hold the Exchange Right and the Automatic Exchange Rights and the legal title thereto as trustee solely for the use and benefit of the Holders in accordance with the provisions of this Agreement; and (ii) except as specifically authorized by this Agreement, have no power or authority to exercise or otherwise deal in or with the Exchange Right or the Automatic Exchange Rights, and the Trustee shall not exercise any such rights for any purpose other than the purposes for which this Trust is created pursuant to this Agreement. (b) Legended Share Certificates. Westcor will cause each certificate representing Exchangeable Shares to bear an appropriate legend notifying the Holders of: (i) their right to instruct the Trustee with respect to the exercise of the Exchange Right in respect of the Exchangeable Shares held by a Holder; and (ii) the Automatic Exchange Rights. (c) General Exercise of Exchange Right. The Exchange Right shall be and remain vested in and exercised by the Trustee. Subject to Section 7(m) hereof, the Trustee shall exercise the Exchange Right only on the basis of instructions received pursuant to this Article 5 from Holders entitled to instruct the Trustee as to the exercise thereof. To the extent that no instructions are received from a Holder with respect to the Exchange Right, the Trustee shall not exercise or permit the exercise of the Exchange Right. (d) Purchase Price. The purchase price payable by Pubco for each Exchangeable Share to be purchased by Pubco under the Exchange Right shall be an amount equal to the Exchangeable Share Price on the last Business Day prior to the day of closing of the purchase and sale of such Exchangeable Share under the Exchange Right. In connection with each exercise of the Exchange Right, Pubco will provide to the Trustee an Officer's Certificate setting forth the calculation of the Exchangeable Share Price for each Exchangeable Share. The Exchangeable Share Price for each such Exchangeable Share so purchased may be satisfied only by Pubco issuing and delivering or causing to be delivered to the Trustee, on behalf of the relevant Holder, the Exchangeable Share Consideration representing the total Exchangeable Share Price. (e) Exercise Instructions. Subject to the terms and conditions herein set forth, a Holder shall be entitled, upon the occurrence and during the continuance of an Insolvency Event, to instruct the Trustee to exercise the Exchange Right with respect to all or any part of the Exchangeable Shares registered in the name of such Holder. To cause the exercise of the Exchange Right by the Trustee, the Holder shall deliver to the Trustee, in person or by certified or registered mail, at its principal offices in Calgary, Alberta or at such other places in Canada as the Trustee may from time to time designate by written notice to the Holders, the certificates representing the Exchangeable Shares which such Holder desires Pubco to purchase, duly endorsed in blank, and accompanied by such other documents and instruments as may be required to effect a transfer of Exchangeable Shares under applicable law and the by-laws of Westcor and such additional documents and instruments as the Trustee may reasonably require together with (i) a duly completed form of notice of exercise of the Exchange Right, contained on the reverse of or attached to the Exchangeable Share certificates, stating (A) that the Holder thereby instructs the Trustee to exercise the Exchange Right so as to require Pubco to purchase from the Holder the number of Exchangeable Shares specified therein, (B) that such Holder has good title to and owns all such Exchangea-ble Shares to be acquired by Pubco free and clear of all liens, claims and encumbrances, (C) the names in which the certificates representing Pubco Common Stock issuable in connection with the exercise of the Exchange Right are to be issued and (D) the names and addresses of the persons to whom the Exchangeable Share Consideration should be delivered and (ii) payment (or evidence satisfactory to the Trustee, Westcor and Pubco of payment) of the taxes (if any) payable as contemplated by Section 5(h) of this Agreement. If only a part of the Exchangeable Shares represented by any certificate or certificates delivered to the Trustee are to be purchased by Pubco under the Exchange Right, a new certificate for the balance of such Exchangeable Shares shall be issued to the Holder at the expense of Westcor. (f) Delivery of Exchangeable Share Consideration; Effect of Exercise. Promptly after receipt of the certificates representing the Exchangeable Shares which the Holder desires Pubco to purchase under the Exchange Right (together with such documents and instruments of transfer and a duly completed form of notice of exercise of the Exchange Right), duly endorsed for transfer to Pubco the Trustee shall notify Pubco and Westcor of its receipt of the same, which notice to Pubco and Westcor shall constitute exercise of the Exchange Right by the Trustee on behalf of the Holder of such Exchangeable Shares, and Pubco shall immediately thereafter deliver or cause to be delivered to the Trustee, for delivery to the Holder of such Exchangeable Shares (or to such other persons, if any, properly designated by such Holder), the Exchangea-ble Share Consideration deliverable in connection with the exercise of the Exchange Right; provided, however, that no such delivery shall be made unless and until the Holder requesting the same shall have paid (or provided evidence satisfactory to the Trustee, Westcor and Pubco of the payment of) the taxes (if any) payable as contemplated by Section 5(h) of this Agreement. Immediately upon the giving of notice by the Trustee to Pubco and Westcor of the exercise of the Exchange Right, as provided in this Section 5 (f), the closing of the transaction of purchase and sale contemplated by the Exchange Right shall be deemed to have occurred, and the Holder of such Exchangeable Shares shall be deemed to have transferred to Pubco all of its right, title and interest in and to such Exchangeable Shares and in the related interest in the Trust Estate and shall cease to be a holder of such Exchangeable Shares and shall not be entitled to exercise any of the rights of a holder in respect thereof, other than the right to receive his proportionate part of the total purchase price therefor, unless such Exchangeable Share Consideration is not delivered by Pubco to the Trustee, for delivery to such Holder (or to such other persons, if any, properly designated by such Holder), within three Business Days of the date of the giving of such notice by the Trustee, in which case the rights of the Holder shall remain unaffected until such Exchangeable Share Consideration is delivered by Pubco and any cheque included therein is paid. Concurrently with such Holder ceasing to be a holder of Exchangeable Shares, the Holder shall be considered and deemed for all purposes to be the holder of the shares of Pubco Common Stock delivered to it pursuant to the Exchange Right. (g) Exercise of Exchange Right Subsequent to Retraction. In the event that a Holder has exercised its right under Article 3.7 of the Exchangeable Share Provisions to require Westcor to redeem any or all of the Exchangeable Shares held by the Holder (the "Retracted Shares") and is notified by Westcor pursuant to Section 3.7(f) of the Exchangeable Share Provisions that Westcor will not be permitted as a result of liquidity or solvency requirements of applicable law to redeem all such Retracted Shares, subject to receipt by the Trustee of written notice to that effect from Westcor and provided that Pubco shall not have exercised the Retraction Call Right with respect to the Retracted Shares and that the Holder has not revoked the retraction request delivered by the Holder to Westcor pursuant to Section 3.7(a) of the Exchangeable Share Provisions, the retraction request will constitute and will be deemed to constitute notice from the Holder to the Trustee instructing the Trustee to exercise the Exchange Right with respect to those Retracted Shares which Westcor is unable to redeem. In any such event, Westcor hereby agrees with the Trustee and in favour of the Holder immediately to notify the Trustee of such prohibition against Westcor redeeming all of the Retracted Shares and immediately to forward or cause to be forwarded to the Trustee all relevant materials delivered by the Holder to Westcor (including without limitation a copy of the retraction request delivered pursuant to Section 3.7(a) of the Exchangeable Share Provisions) in connection with such proposed redemption of the Retracted Shares and the Trustee will thereupon exercise the Exchange Right with respect to the Retracted Shares that Westcor is not permitted to redeem and will require Pubco to purchase such shares in accordance with the provisions of this Article 5. (h) Stamp or Other Transfer Taxes. Upon any sale of Exchangeable Shares to Pubco pursuant to the Exchange Right or the Automatic Exchange Rights, the share certificate or certificates representing Pubco Common Stock to be delivered in connection with the payment of the total purchase price therefor shall be issued in the name of the Holder of the Exchangeable Shares so sold or in such names as such Holder may otherwise direct in writing without charge to the holder of the Exchangeable Shares so sold, provided, however, that such Holder (i) shall pay (and neither Pubco, Westcor nor the Trustee shall be required to pay) any documentary, stamp, transfer or other similar taxes that may be payable in respect of any transfer involved in the issuance or delivery of such shares to a person other than such Holder or (ii) shall have established to the satisfaction of the Trustee, Pubco and Westcor that such taxes, if any, have been paid. (i) Notice of Insolvency Event. Immediately upon the occurrence of an Insolvency Event or any event which with the giving of notice or the passage of time or both would be an Insolvency Event Westcor and Pubco shall give written notice thereof to the Trustee. As soon as practicable after receiving notice from Westcor and Pubco or from any other Person of the occurrence of an Insolvency Event, the Trustee will mail to each Holder, at the expense of Pubco, a notice of such Insolvency Event in the form provided by Pubco, which notice shall contain a brief statement of the right of the Holders with respect to the Exchange Right. (j) Reservation of Shares of Pubco Common Stock. Pubco hereby represents, warrants and covenants that it has irrevocably reserved for issuance and will at all times keep available, free from pre-emptive and other rights, out of its authorized and unissued capital stock such number of shares of Pubco Common Stock (i) as is equal to the sum of (A) the number of Exchangeable Shares issued and outstanding from time to time and (B) the number of Exchangeable Shares issuable upon the exercise of all rights to acquire Exchangeable Shares outstanding from time to time and (ii) as are now and may hereafter be required to enable and permit Westcor and Pubco to meet their respective obligations hereunder, under the Support Agreement, under the Exchangeable Share Provisions and under any other security or commitment pursuant to the Share Purchase Agreement with respect to which Pubco may now or hereafter be required to issue shares of Pubco Common Stock. (k) Automatic Exchange on Liquidation of Pubco (i) Pubco will give the Trustee written notice of each of the following events at the time set forth below: (A) in the event of any determination by the board of directors of Pubco to institute voluntary liquidation, dissolution or winding-up proceedings with respect to Pubco or to effect any other distribution of assets of Pubco among its stockholders for the purpose of winding-up its affairs, at least 60 days prior to the proposed effective date of such liquidation, dissolution, winding-up or other distribution; and (B) immediately, upon the earlier of (I) receipt by Pubco of notice of and (II) Pubco otherwise becoming aware of any threatened or instituted claim, suit, petition or other proceedings with respect to the involuntary liquidation, dissolution or winding-up of Pubco or to effect any other distribution of assets of Pubco among its stockholders for the purpose of winding-up its affairs. (ii) Immediately following receipt by the Trustee from Pubco of notice of any event (a "Liquidation Event") contemplated by Section 5 (k) (i) above, the Trustee will give notice thereof to the Holders. Such notice will be provided by Pubco to the Trustee and shall include a brief description of the automatic exchange of Exchangeable Shares for shares of Pubco Common Stock provided for in Section 5(k) (iii) below. (iii) In order that the Holders will be able to participate on a PRO RATA basis with the holders of Pubco Common Stock in the distribution of assets of Pubco in connection with a Liquidation Event, immediately prior to the effective time (the "Liquidation Event Effective Time") of a Liquidation Event all of the then outstanding Exchangeable Shares shall be automatically exchanged for shares of Pubco Common Stock. To effect such automatic exchange, Pubco shall be deemed to have purchased each Exchangeable Share outstanding immediately prior to the Liquidation Event Effective Time and held by Holders, and each Holder shall be deemed to have sold the Exchangeable Shares held by it at such time, for a purchase price per share equal to the Exchangeable Share Price applicable at such time. In connection with such automatic exchange, Pubco shall provide to the Trustee an Officers' Certificate setting forth the calculation of the purchase price for each Exchangeable Share. (iv) The closing of the transaction of purchase and sale contemplated by Section 5(k)(iii) above shall be deemed to have occurred immediately prior to the Liquidation Event Effective Time, and each Holder of Exchangeable Shares shall be deemed to have transferred to Pubco all of the Holder's right, title and interest in and to such Exchangeable Shares and the related interest in the Trust Estate and shall cease to be a holder of such Exchangeable Shares and Pubco shall deliver to the Holder the Exchangeable Share Consideration deliverable upon the automatic exchange of Exchangeable Shares. Concurrently with such Holder ceasing to be a holder of Exchangeable Shares, the Holder shall be considered and deemed for all purposes to be the holder of the shares of Pubco Common Stock issued to it pursuant to the automatic exchange of Exchangeable Shares for Pubco Common Stock and the certificates held by the Holder previously representing the Exchangeable Shares exchanged by the Holder with Pubco pursuant to such automatic exchange shall thereafter be deemed to represent the shares of Pubco Common Stock issued to the Holder by Pubco pursuant to such automatic exchange. Upon the request of a Holder and the surrender by the Holder of Exchangeable Share certificates deemed to represent shares of Pubco Common Stock, duly endorsed in blank and accompanied by such instruments of transfer as Pubco may reasonably require, Pubco shall deliver or cause to be delivered to the Holder certificates representing the shares of Pubco Common Stock of which the Holder is the holder. 6. RESTRICTIONS ON ISSUANCE OF PUBCO SPECIAL VOTING STOCK During the term of this Agreement, Pubco will not issue any shares of Pubco Special Voting Stock in addition to the Voting Share. 7. CONCERNING THE TRUSTEE (a) Powers and Duties of the Trustee. The rights, powers and authorities of the Trustee under this Agreement, in its capacity as trustee of the Trust, shall include: (i) receipt and deposit of the Voting Share from Pubco as trustee for and on behalf of the Holders in accordance with the provisions of this Agreement; (ii) granting proxies and distributing materials to Holders as provided in this Agreement; (iii) voting the Holder Votes in accordance with the provisions of this Agreement; (iv) receiving the grant of the Exchange Right and the Automatic Exchange Rights from Pubco as trustee for and on behalf of the Holders in accordance with the provisions of this Agreement; (v) exercising the Exchange Right and enforcing the benefit of the Automatic Exchange Rights, in each case in accordance with the provisions of this Agreement, and in connection therewith receiving from Holders Exchangeable Shares and other requisite documents and distributing to such Holders the shares of Pubco Common Stock and cheques, if any, to which such Holders are entitled upon the exercise of the Exchange Right or pursuant to the Automatic Exchange Rights, as the case may be; (vi) holding title to the Trust Estate; (vii) investing any monies forming, from time to time, a part of the Trust Estate as provided in this Agreement; (viii) taking action at the direction of a Holder or Holders to enforce the obligations of Pubco under this Agreement; and (ix) taking such other actions and doing such other things as are specifically provided in this Agreement. In the exercise of such rights, powers and authorities the Trustee shall have (and is granted) such incidental and additional rights, powers and authority not in conflict with any of the provisions of this Agreement as the Trustee, acting in good faith and in the reasonable exercise of its discretion, may deem necessary, appropriate or desirable to effect the purpose of the Trust. Any exercise of such discretionary rights, powers and authorities by the Trustee shall be final, conclusive and binding upon all persons. For greater certainty, the Trustee shall have only those duties as are set out specifically in this Agreement. The Trustee shall not be bound to give any notice or do or take any act, action or proceeding by virtue of the powers conferred on it hereby unless and until it shall be specifically required to do so under the terms hereof; nor shall the Trustee be required to take any notice of, or to do or to take any act, action or proceeding as a result of any default or breach of any provision hereunder, unless and until notified in writing of such default or breach, which notices shall distinctly specify the default or breach desired to be brought to the attention of the Trustee and in the absence of such notice the Trustee may for all purposes of this Agreement conclusively assume that no default or breach has been made in the observance or performance of any of the representations, warranties, covenants, agreements or conditions contained herein. (b) None of the provisions contained in this Agreement shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the exercise of any of its rights, powers, duties or authorities unless funded, given funds, security and indemnified; such costs and expenses shall be paid for by Pubco. The Trustees shall not be required to take any action until it has received reasonable funding, security and indemnity against the costs, expenses and liabilities which may be incurred by the Trustee. (c) Dealings with Transfer Agents, Registrars, etc. Pubco irrevocably authorizes the Trustee, from time to time, to: (i) consult, communicate and otherwise deal with the respective registrars and transfer agents, and with any such subsequent registrar or transfer agent, of the Pubco Common Stock; and (ii) requisition (A) from any such registrar or transfer agent any information readily available from the records maintained by it which the Trustee may reasonably require for the discharge of its duties and responsibilities under this Agreement and (B) from the transfer agent of Pubco Common Stock, and any subsequent transfer agent of such shares, the share certificates issuable upon the exercise from time to time of the Exchange Right and pursuant to the Automatic Exchange Rights in the manner specified in Article 5 hereof. Pubco irrevocably authorizes and agrees to direct its registrars and transfer agents to comply with all such requests. Pubco covenants that it will supply its transfer agent with duly executed share certificates for the purpose of completing the exercise from time to time of the Exchange Right and the Automatic Exchange Rights, in each case pursuant to Article 5 hereof. (d) Books and Records. The Trustee shall keep available for inspection by Pubco and Westcor, at the Trustee's principal office in Edmonton, Alberta, correct and complete books and records of account relating to the Trustee's actions under this Agreement, including without limitation all information relating to mailings and instructions to and from Holders and all transactions pursuant to the Voting Rights, the Exchange Right and the Automatic Exchange Rights for the term of this Agreement. On or before April 30, 2001, and on or before April 30 in every year thereafter, so long as the Voting Share is on deposit with the Trustee, the Trustee shall transmit to Pubco and Westcor a brief report with respect to: (i) the property and funds comprising the Trust Estate as of that date; (ii) the number of exercises of the Exchange Right, if any, and the aggregate number of Exchangeable Shares received by the Trustee on behalf of Holders in consideration of the issue and delivery by Pubco of shares of Pubco Common Stock in connection with the Exchange Right, during the calendar year ended on such date; and (iii) all other actions taken by the Trustee in the performance of its duties at the expense of Pubco under this Agreement which it had not previously reported. (e) Income Tax Returns and Reports. The Trustee shall, to the extent necessary, prepare and file or cause to be prepared and filed on behalf of the Trust appropriate United States and Canadian income tax returns and any other returns or reports as may be required by applicable law, may obtain the advice and assistance of such experts as the Trustee may consider necessary or advisable. If requested by the Trustee, Pubco shall retain such experts for purposes of providing such advice and assistance. (f) Actions by Holders. Neither of the Vendors, as long as they are Holders, shall have the right to institute any action, suit or proceeding or to exercise any other remedy authorized by this Agreement for the purpose of enforcing any of its rights or for the execution of any trust or power hereunder unless the Holder has requested the Trustee to take or institute such action, suit or proceeding and furnished the Trustee with the funding, security and indemnity referred to in Section 7(b) hereof and the Trustee shall have failed to act within a reasonable time thereafter. In such case, but not otherwise, the Holder shall be entitled to take proceedings in any court of competent jurisdiction such as the Trustee might have taken; it being understood and intended that no one or more Holders shall have any right in any manner whatsoever to affect, disturb or prejudice the rights hereby created by any such action, or to enforce any right hereunder or under the Voting Rights, the Exchange Right or the Automatic Exchange Rights, except subject to the conditions and in the manner herein provided, and that all powers and trusts hereunder shall be exercised and all proceedings at law shall be instituted, had and maintained by the Trustee, except only as herein provided, and in any event for the equal benefit of all Holders. (g) Reliance upon Declarations. The Trustee shall not be considered to be in contravention of any of its rights, powers, duties and authorities hereunder if, when required, it acts and relies in good faith upon lists, mailing labels, notices, statutory declarations, certificates, opinions, reports or other papers or documents furnished pursuant to the provisions hereof or required by the Trustee to be furnished to it in the exercise of its rights, powers, duties and authorities hereunder and such lists, mailing labels, notices, statutory declarations, certificates, opinions, reports or other papers or documents comply with the provisions of Section 7(i) hereof, if applicable, and with any other applicable provisions of this Agreement. (h) Evidence and Authority to Trustee. Westcor and/or Pubco shall furnish to the Trustee evidence of compliance with the conditions provided for in this Agreement relating to any action or step required or permitted to be taken by Westcor and/or Pubco or the Trustee under this Agreement or as a result of any obligation imposed under this Agreement, including, without limitation, in respect of the Voting Rights or the Exchange Right or the Automatic Exchange Rights and the taking of any other action to be taken by the Trustee at the request of or on the application of Westcor and/or Pubco forthwith if and when: (i) such evidence is required by any other section of this Agreement to be furnished to the Trustee in accordance with the terms of this Section 7(h); or (ii) the Trustee, in the exercise of its rights, powers, duties and authorities under this Agreement, gives Westcor and/or Pubco written notice requiring it to furnish such evidence in relation to any particular action or obligation specified in such notice. Such evidence shall consist of an Officers' Certificate of Westcor and/or Pubco or a statutory declaration or a certificate made by persons entitled to sign an Officer's Certificate stating that any such condition has been complied with in accordance with the terms of this Agreement. Whenever such evidence relates to a matter other than the Voting Rights or the Exchange Right or the Automatic Exchange Rights, and except as otherwise specifically provided herein, such evidence may consist of a report or opinion of any solicitor, auditor, accountant, appraiser, valuer, engineer or other expert or any other person whose qualifications give authority to a statement made by him provided that if such report or opinion is furnished by a director, officer or employee of Westcor and/or Pubco it shall be in the form of an Officers' Certificate or a statutory declaration. Each statutory declaration, certificate, opinion or report furnished to the Trustee as evidence of compliance with a condition provided for in this Agreement shall include a statement by the person giving the evidence: (iii) declaring that he has read and understands the provisions of this Agreement relating to the condition in question; (iv) describing the nature and scope of the examination or investigation upon which he based the statutory declaration, certificate, statement or opinion; and (v) declaring that he has made such examination or investigation as he believes is necessary to enable him to make the statements or give the opinions contained or expressed therein. (i) Experts, Advisors and Agents. The Trustee may: (i) in relation to these presents act and rely on the opinion or advice of or information obtained from or prepared by any solicitor, auditor, accountant, appraiser, valuer, engineer or other expert, whether retained by the Trustee or by Westcor and/or Pubco or otherwise, and may employ such assistants as may be necessary to the proper determination and discharge of its powers and duties and determination of its rights hereunder and may pay proper and reasonable compensation for all such legal and other advice or assistance as aforesaid; and (ii) employ such agents and other assistants as it may reasonably require for the proper determina-tion and discharge of its powers and duties hereunder, and may pay reasonable remuneration for all services performed for it (and shall be entitled to receive reasonable remuneration for all services performed by it) in the discharge of the trusts hereof and compensation for all disbursements, costs and expenses made or incurred by it in the determination and discharge of its duties hereunder and in the management of the Trust. (j) Investment of Monies Held by Trustee. Unless otherwise provided in this Agreement, any monies held by or on behalf of the Trustee which under the terms of this Agreement may or ought to be invested or which may be on deposit with the Trustee or which may be in the hands of the Trustee may be invested and reinvested in the name or under the control of the Trustee in securities in which, under the laws of the Province of Alberta trustees are authorized to invest trust unit monies, provided that such securities are stated to mature within two years after their purchase by the Trustee, and the Trustee shall so invest such monies on the written direction of Westcor. Pending the investment of any monies as hereinbefore provided, such monies may be deposited in the name of the Trustee in any chartered bank in Canada or, with the consent of Westcor, in the deposit department of the Trustee or any other loan or company authorized to accept deposits under the laws of Canada or any province thereof at the rate of interest then current on similar deposits. (k) Trustee Not Required to Give Security. The Trustee shall not be required to give any bond or security in respect of the execution of the trusts, rights, duties, powers and authorities of this Agreement or otherwise in respect of the premises. (l) Trustee Not Bound to Act on Request. Except as in this Agreement otherwise specifically provided, the Trustee shall not be bound to act in accordance with any direction or request of Westcor and/or Pubco or of the directors thereof until a duly authenticated copy of the instrument or resolution containing such direction or request shall have been delivered to the Trustee, and the Trustee shall be empowered to act and rely upon any such copy purporting to be authenticated and believed by the Trustee to be genuine. (m) Conflicting Claims. If conflicting claims or demands are made or asserted with respect to any interest of any Holder in any Exchangeable Shares, including any disagreement between the heirs, representatives, successors or assigns succeeding to all or any part of the interest of any Holder in any Exchangeable Shares resulting in conflicting claims or demands being made in connection with such interest, then the Trustee shall be entitled, at its sole discretion, to refuse to recognize or to comply with any such claim or demand. In so refusing, the Trustee may elect not to exercise any Voting Rights, Exchange Right or Automatic Exchange Rights subject to such conflicting claims or demands and, in so doing, the Trustee shall not be or become liable to any person on account of such election or its failure or refusal to comply with any such conflicting claims or demands. The Trustee shall be entitled to continue to refrain from acting and to refuse to act until: (i) the rights of all adverse claimants with respect to the Voting Rights, Exchange Right or Automatic Exchange Rights subject to such conflicting claims or demands have been adjudicated by a final judgment of a court of competent jurisdiction; or (ii) all differences with respect to the Voting Rights, Exchange Right or Automatic Exchange Right subject to such conflicting claims or demands have been conclusively settled by a valid written agreement binding on 'all such adverse claimants, and the Trustee shall have been furnished with an executed copy of such agreement. If the Trustee elects to recognize any claim or comply with any demand made by any such adverse claimant, it may in its discretion require such claimant to furnish such surety bond or other security satisfactory to the Trustee as it shall deem appropriate fully to indemnify it as between all conflicting claims or demands. (n) Acceptance of Trust. The Trustee hereby accepts the Trust created and provided for by and in this Agreement and agrees to perform the same upon the terms and conditions herein set forth and to hold all rights, privileges and benefits conferred hereby and by law in trust for the various persons who shall from time to time be Holders, subject to all the terms and conditions herein set forth. 8. COMPENSATION The Vendors jointly and severally agree to pay to the Trustee reasonable compensation for all of the services rendered by it under this Agreement and will reimburse the Trustee for all reasonable expenses (including but not limited to taxes, compensation paid to experts, agents and advisors and travel expenses) and disbursements, including the cost and expense of any suit or litigation of any character and any proceedings before any governmental agency reasonably incurred by the Trustee in connection with its rights and duties under this Agreement; provided that the Vendors shall have no obligation to reimburse the Trustee for any expenses or disbursements paid, incurred or suffered by the Trustee in any suit or litigation in which the Trustee is determined to have acted with gross negligence or willful misconduct. 9. INDEMNIFICATION AND LIMITATION OF LIABILITY (a) Indemnification of the Trustee. Subject to paragraph 8 above, the Vendors, Pubco and Westcor jointly and severally agree to indemnify and hold harmless the Trustee, its partners, employees, agents, successors and assigns (collectively, the "Indemnified Parties") against all claims, losses, damages, costs, penalties, and fines (including reasonable expenses of the legal counsel on a solicitor-and-his-own-client basis) which, without gross negligence or willful misconduct on the part of such Indemnified Party, may be paid, incurred or suffered by the indemnified Party by reason of or as a result of the Trustee's acceptance or administration of the Trust, its compliance with its duties set forth in this Agreement, or any written or oral instructions delivered to the Trustee by the Vendors, Pubco or Westcor pursuant hereto. In no case shall either of the Vendors, Pubco or Westcor be liable under this indemnity for any claim against any of the Indemnified Parties unless the Vendors, Pubco and Westcor shall be notified by the Trustee of the written assertion of a claim or of any action commenced against the Indemnified Parties, promptly after any of the Indemnified Parties shall have received any such written assertion of a claim or shall have been served with a summons or other first legal process giving information as to the nature and basis of the claim. Subject to (ii), below, the Vendors, Pubco and Westcor shall be entitled to participate at their own expense in the defence and, if the Vendors, Pubco or Westcor so elect at any time after receipt of such notice, either of them may assume the defence of any suit brought to enforce any such claim. The Trustee shall have the right to employ separate counsel in any such suit and participate in the defence thereof but the fees and expenses of such counsel shall be at the expense of the Trustee unless: (i) the employment of such counsel has been authorized by the Vendors, Pubco or Westcor, such authorization not to be unreasonably withheld; or (ii) the named parties to any such suit include both the Trustee and at least one of the Vendors, Pubco or Westcor and the Trustee shall have been advised by counsel acceptable to the Vendors, Pubco or Westcor that there may be one or more legal defences available to the Trustee that are different from or in addition to those available to the Vendors, Pubco or Westcor and that an actual or potential conflict exists (in which case the Vendors, Pubco and Westcor shall not have the right to assume the defense of such suit on behalf of the Trustee but shall be liable to pay the reasonable fees and expenses of counsel for the Trustee). (b) Limitation of Liability. The Trustee shall not be held liable for any loss which may occur by reason of depreciation of the value of any part of the Trust Estate or any loss incurred on any investment of funds pursuant to this Agreement except to the extent that such loss is attributable to the gross negligence or willful misconduct on the part of the Trustee. 10. CHANGE OF TRUSTEE (a) Resignation. The Trustee, or any trustee hereafter appointed, may at any time resign by giving written notice of such resignation to Pubco and Westcor specifying the date on which it desires to resign, provided that such notice shall not be given less than 30 days before such desired resignation date unless Pubco and Westcor otherwise agree. Upon receiving such notice of resignation, Pubco and Westcor shall promptly appoint a successor trustee by written instrument in duplicate, one copy of which shall be delivered to the resigning trustee and one copy to the successor trustee. Failing acceptance by a successor trustee, a successor trustee may be appointed by an order of the Alberta Court of Queen's Bench upon application of one or more of the parties hereto. (b) Removal. The Trustee, or any Trustee hereafter appointed, may be removed with or without cause, at any time on 30 days prior notice by written instrument executed by Pubco and Westcor, in duplicate, one copy of which shall be delivered to the trustee so removed and one copy to the successor trustee, provided that, in connection with such removal, provision is made for a replacement trustee similar to that contemplated in Section 10(a). (c) Successor Trustee. Any successor trustee appointed as provided under this Agreement shall execute, acknowledge and deliver to Pubco and Westcor and to its predecessor trustee an instrument accepting such appointment. Thereupon the resignation or removal of the predecessor trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, duties and obligations of its predecessor under this Agreement, with like effect as if originally named as trustee in this Agreement. However, on the written request of Pubco and Westcor or of the successor trustee, the trustee ceasing to act shall, upon payment of any amounts then due it pursuant to the provisions of this Agreement, execute and deliver an instrument transferring to such successor trustee all the rights and powers of the trustee so ceasing to act. Upon the request of any such successor trustee, Pubco, Westcor and such predecessor trustee shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. (d) Notice of Successor Trustee. Upon acceptance of appointment by a successor trustee as provided herein, Pubco and Westcor shall cause to be mailed notice of the succession of such trustee hereunder to each Holder specified in a List. If Pubco or Westcor shall fail to cause such notice to be mailed within 10 days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be mailed at the expense of Pubco and Westcor. 11. PUBCO SUCCESSORS (a) Certain Requirements in Respect of Combination, etc. Pubco shall not enter into any transaction (whether by way of reconstruction, reorganization, consolidation, merger, transfer, sale, lease or otherwise) whereby all or substantially all of its undertaking, property and assets would become the property of any other Person or, in the case of a merger, of the continuing corporation resulting therefrom unless: (i) such other Person or continuing corporation (the "Pubco Successor"), by operation of law, becomes, without further action, bound by the terms and provisions of this Agreement or, if not so bound, executes, prior to or contemporaneously with the consummation of such transaction an agreement supplemental hereto and such other instruments (if any) as are necessary or advisable to evidence the assumption by the Pubco Successor of liability for all monies payable and property deliverable hereunder and the covenant of such Pubco Successor to pay and deliver or cause to be delivered the same and its agreement to observe and perform all the covenants and obligations of Pubco under this Agreement; and such transaction shall be upon such terms as substantially to preserve and not to impair in any material respect any of the rights, duties, powers and authorities of the Trustee or of the Holders hereunder; or (ii) doing so will not, in the reasonable opinion of Pubco, adversely affect the rights of any holder of Exchangeable Shares, and Pubco provides to each holder of Exchangeable Shares 15 days notice of such intended action. (b) Vesting of Powers in Successor. Whenever the conditions of Section 11 (a) hereof have been duly observed and performed, the Trustee, if required, by Section 11 (a) hereof, the Pubco Successor and Westcor shall execute and deliver the supplemental agreement provided for in Article 12 hereof and thereupon the Pubco Successor shall possess and from time to time may exercise each and every right and power of Pubco under this Agreement in the name of Pubco or otherwise and any act or proceeding by any provision of this Agreement required to be done or performed by the board of directors of Pubco or any officers of Pubco may be done and performed with like force and effect by the directors or officers of such Pubco Successor. (c) Wholly-Owned Subsidiaries. Nothing herein shall be construed as preventing the amalgamation or merger of any wholly-owned subsidiary of Pubco with or into Pubco or the winding-up, liquidation or dissolution of any wholly-owned subsidiary of Pubco provided that all of the assets of such subsidiary are transferred to Pubco or another wholly-owned subsidiary of Pubco, and any such transactions are expressly permitted by this Article 11. 12. AMENDMENTS AND SUPPLEMENTAL AGREEMENTS (a) Amendments, Modifications, etc. This Agreement may not be amended or modified except by an agreement in writing executed by Westcor, Pubco and the Trustee and approved by the Holders in accordance with Section 3.10(b) of the Exchangeable Share Provisions. (b) Ministerial Amendments. Notwithstanding the provisions of Section 12(a) hereof, the parties to this Agreement may in writing, at any time and from time to time, without the approval of the Holders, amend or modify this Agreement for the purposes of: (i) adding to the covenants of any or all of the parties hereto for the protection of the Holders hereunder; (ii) making such amendments or modifications not inconsistent with this Agreement as may be necessary or desirable with respect to matters or questions which, in the opinion of the board of directors of each of Pubco and Westcor and in the opinion of the Trustee and its counsel having in mind the best interests of the Holders as a whole, it may be expedient to make, provided that such boards of directors and the Trustee and its counsel shall be of the opinion that such amendments and modifications will not be prejudicial to the interests of the Holders as a whole; or (iii) making such changes or corrections which, on the advice of counsel to Westcor, Pubco and the Trustee, are required for the purpose of curing or correcting any ambiguity or defect or inconsistent provision or clerical omission or mistake or manifest error, provided that the Trustee and its counsel and the board of directors of each of Westcor and Pubco shall be of the opinion that such changes or corrections will not be prejudicial to the interests of the Holders as a whole. (c) Meeting to Consider Amendments. Westcor, at the request of Pubco, shall call a meeting or meetings of the Holders for the purpose of considering any proposed amendment or modification requiring approval pursuant hereto. Any such meeting or meetings shall be called and held in accordance with the by-laws of Westcor, the Exchangeable Share Provisions and all applicable laws. (d) Changes in Capital of Pubco and Westcor. At all times after the occurrence of any event effected pursuant to Section 2(5) or Section 2(6) of the Support Agreement, as a result of which either Pubco Common Stock or the Exchangeable Shares or both are in any way changed, this Agreement shall forthwith be amended and modified as necessary in order that it shall apply with full force and effect, mutatis mutandis, to all new securities into which Pubco Common Stock or the Exchangeable Shares or both are so changed and the parties hereto shall execute and deliver a supplemental agreement giving effect to and evidencing such necessary amendments and modifications. (e) Execution of Supplemental Agreements. No amendment to or modification or waiver of any of the provisions of this Agreement otherwise permitted hereunder shall be effective unless made in writing and signed by all of the parties hereto. From time to time Westcor (when authorized by a resolution of its Board of Directors), Pubco (when authorized by a resolution of its board of directors) and the Trustee may, subject to the provisions of these presents, and they shall, when so directed by these presents, execute and deliver by their proper officers, agreements or other instruments supplemental hereto, which thereafter shall form part hereof, for any one or more of the following purposes: (i) evidencing the succession of any Pubco Successors to Pubco and the covenants of and obligations assumed by each such Pubco Successors in accordance with the provisions of Article 11, and the successor of any successor trustee in accordance with the provisions of Article 10; (ii) making any additions to, deletions from or alterations of the provisions of this Agreement or the Voting Rights, the Exchange Right or the Automatic Exchange Rights which, in the opinion of the Trustee and its counsel, will not be prejudicial to the interests of the Holders as a whole or are in the opinion of counsel to the Trustee necessary or advisable in order to incorporate, reflect or comply with any legislation the provisions of which apply to Pubco, Westcor, the Trustee or this Agreement; and (iii) for any other purposes not inconsistent with the provisions of this Agreement, including without limitation to make or evidence any amendment or modification to this Agreement as contem-plated hereby, provided that, in the opinion of the Trustee and its counsel, the rights of the Trustee and the Holders as a whole will not be prejudiced thereby. 13. TERMINATION (a) Term. The Trust created by this Agreement shall continue until the earliest to occur of the following events: (i) no outstanding Exchangeable Shares are held by a Holder; (ii) each of Westcor and Pubco elects in writing to terminate the Trust and such termination is approved by the Holders of the Exchangeable Shares in accordance with Section 3.10(b) Exchangeable Share Provisions; and (iii) twenty-one (21) years after the death of the last survivor of the descendants of His Majesty King George VI of the United Kingdom of Great Britain and Northern Ireland living on the date of the creation of the Trust. (b) Survival of Agreement. This Agreement shall survive any termination of the Trust and shall continue until there are no Exchangeable Shares outstanding held by a Holder, provided, however, that the provisions of Articles 8 and 9 hereof shall survive any such termination of this Agreement. 14. PIGGYBACK RIGHT Pubco agrees that it shall provide a written notice (the "Pubco Notice") to each of the Vendors at least 30 days prior to taking any steps to file with any securities regulators any documents necessary to qualify for sale any of the Pubco Common Stock for public distribution in any jurisdiction in Canada or the United States of America. Thereafter, should either or both of the Vendors provide written notice to Pubco within 20 days of receiving the Pubco Notice requesting that any Exchangeable Share Consideration already received or which may be received by the Vendor, be qualified in addition to the securities proposed to be qualified by Pubco, Pubco shall take all steps necessary to qualify the Exchangeable Share Consideration for distribution. Should the Vendors choose to have their Exchangeable Share Consideration qualified for sale, they shall pay their proportionate share of any applicable sales commission and shall pay the reasonable incremental costs which may be incurred in preparation of the documents necessary to qualify their securities for public distribution. 15. GENERAL (a) Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality or enforceability of the remainder of this Agreement shall not in any way be affected or impaired thereby and the agreement shall be carried out as nearly as possible in accordance with its original terms and conditions. (b) Enurement. This Agreement shall be binding upon and enure to the benefit of the parties hereto and their respective successors and permitted assigns and to the benefit of the Holders. (c) Notices to Parties. All notices and other communications between the parties hereunder shall be in writing and shall be deemed to have been given if delivered personally or by confirmed telecopy to the parties at the following addresses (or at such other address for such party as shall be specified in like notice): (i) if to Pubco at: 150-1875 Century Park East Century City, California, U.S.A. 90067 Attention: President Fax: 604.681.3652 (ii) if to Westcor at: #204, 1109 - 17th Avenue, S.W. Calgary, Alberta T2T 5R9 Attention: President Fax: 403 228.7101 (iii) if to the Trustee at: Miller Thomson Barristers and Solicitors 3000, 700-9th Avenue S.W. Calgary, Alberta T2P 3V4 Attention: Mike Hayduk Q.C. Fax: 403.262.0007 Any notice or other communication given personally shall be deemed to have been given and received upon delivery thereof and if given by telecopy shall be deemed to have been given and received on the date of receipt thereof unless such day is not a Business Day in which case it shall be deemed to have been given and received upon the immediately following Business Day. (d) Notice of Holders. Any and all notices to be given and any documents to be sent to any Holders may be given or sent to the address of such Holder shown on the register of Holders of Exchangeable Shares in any manner permitted by the Exchangeable Share Provisions and shall be deemed to be received (if given or sent in such manner) at the time specified in such Exchangeable Share Provisions, the provisions of which the Exchangeable Share Provisions shall apply mutatis mutandis to notices or documents as aforesaid sent to such Holders. (e) Risk of Payments by Post. Whenever payments are to be made or documents are to be sent to any Holder by the Trustee, by Westcor or by Pubco or by such Holder to the Trustee or to Pubco or Westcor, the making of such payment or sending of such document sent through the post shall be at the risk of Westcor or Pubco, in the case of payments made or documents sent by the Trustee or Westcor or Pubco, and the Holder, in the case of payments made or documents sent by the Holder. (f) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. (g) Jurisdiction. This Agreement shall be construed and enforced in accordance with the laws of the Province of Alberta and the laws of Canada applicable therein; (h) Attornment. Pubco agrees that any action or proceeding arising out of or relating to this Agreement may be instituted in the courts of Alberta, waives any objection which it may have now or hereafter to the venue of any such action or proceeding, irrevocably submits to the jurisdiction of the said courts in any such action or proceeding, agrees to be bound by any judgment of the said courts and agrees not to seek, and hereby waives, any review of the merits of any such judgment by the courts of any other jurisdiction and hereby appoints Westcor at its registered office in the Province of Alberta as Pubco's attorney for service of process. (i) Recitals. The recitals form part of this agreement. IN WITNESS WHEREOF, the parties hereby have caused this Agreement to be duly executed as of the date first above written. E-FINANCIAL DEPOT.COM, INC. (A DELAWARE CORPORATION) Per: /s/ John Huguet WESTCOR MORTGAGE INC. (AN ALBERTA CORPORATION) Per: /s/ Patricia Kirkham MILLER THOMSON (TRUSTEE) Per: /s/ signed Per: /s/ signed /s/ signed /s/ Patricia Kirkham Witness PATRICIA KIRKHAM /s/ signed /s/ Dennis Petersen Witness DENNIS PETERSEN EX-2.4 5 0005.txt HYPOTHECATION AGREEMENT THIS AGREEMENT made effective the 29th day of February, 2000. AMONG: PATRICIA KIRKHAM AND DENNIS PETERSEN, (the "VENDORS") - and - EFINANCIAL DEPOT.COM, INC., (the "PURCHASER") - and - WESTCOR MORTGAGE INC., (the "CORPORATION") - and - MILLER THOMSON, Barristers and Solicitors (the "TRUSTEE") HYPOTHECATION AGREEMENT ------------------------ WHEREAS: A. Pursuant to the SHARE PURCHASE AGREEMENT, the VENDORS have agreed to sell to the PURCHASER the SHARES; B. Pursuant to the SHARE PURCHASE AGREEMENT, the PURCHASER is indebted to the VENDORS on account of the purchase price of the SHARES; C. Pursuant to Section 3.2 of the SHARE PURCHASE AGREEMENT, the PURCHASER has agreed to enter into this Hypothecation Agreement; NOW THEREFORE THIS AGREEMENT WITNESSETH that, in consideration of the sum of One ($1.00) Dollar now paid each to the other (the receipt and sufficiency of which is hereby acknowledged) and of the agreements herein contained, the parties do hereby mutually agree as follows: ARTICLE1 - -------- 1.1 Definitions ----------- In this AGREEMENT the following expressions will have the meanings herein set forth: (a) ACT OF DEFAULT means the acts of default specified in Section 4.1 herein; (b) AGREEMENT, "herein" and "hereof" means this Hypothecation Agreement; (c) INDEBTEDNESS means the amount owing from time to time by the PURCHASER to the VENDORS on account of the purchase price of the SHARES or interest thereon in accordance with the provisions of the SHARE PURCHASE AGREEMENT, together with any legal fees, on a solicitor-and-his-own-client basis, incurred by the VENDORS in connection with enforcing the payment and satisfaction of such indebtedness; (d) SHARE CERTIFICATE means share certificate 6A issued to the PURCHASER evidencing the PURCHASER's ownership of the SHARES; (e) SHARE PURCHASE AGREEMENT means that certain SHARE PURCHASE AGREEMENT in writing effective the 29th day of February, 2000, and made between VENDORS and the PURCHASER; (f) SHARES means one hundred thousand (100,000) Class "A" shares in the share capital of the CORPORATION purchased by the PURCHASER pursuant to the SHARE PURCHASE AGREEMENT and represented by the SHARE CERTIFICATE. 1.2 Preamble Incorporation ----------------------- The parties hereby confirm and ratify the matters contained and referred to in the preamble to this AGREEMENT and agree that same are expressly incorporated into this AGREEMENT. ARTICLE 2 - --------- 2.1 TRUSTEE ------- The TRUSTEE and its successors and assigns is hereby appointed to act as escrow agent for the purposes of this Hypothecation Agreement and the TRUSTEE hereby agrees to act as escrow agent in accordance with the terms and conditions of this AGREEMENT. 2.2 Hypothecation ------------- As security pursuant to and not in payment of the INDEBTEDNESS, the PURCHASER does hereby pledge and hypothecate all its legal and beneficial interest in the SHARES to the VENDORS all on the terms and conditions set out in this AGREEMENT. 2.3 Transfer of SECURITY SHARES ------------------------------ For the purposes hereof, the PURCHASER hereby agrees that the SHARE CERTIFICATE together with a transfer of same in favour of the VENDORS as of the date hereof shall be delivered forthwith to the TRUSTEE with the executed copies of this AGREEMENT. 2.4 Directors Resolutions ---------------------- The PURCHASER agrees to deliver forthwith to the TRUSTEE a resolution in writing of the directors of the CORPORATION approving the transfer of the SHARES from the PURCHASER to the VENDORS. ARTICLE 3 - --------- 3.1 Voting Rights -------------- The parties agree that the PURCHASER shall be entitled to exercise all voting rights in respect of the SHARES unless and until there shall be an ACT OF DEFAULT. 3.2 Shares To Be Property of PURCHASER --------------------------------------- The SHARES shall remain the property of the PURCHASER and the PURCHASER shall be entitled to all benefits pertaining to the SHARES including, without limitation, any dividends declared thereon unless and until the PURCHASER fails to cure an ACT OF DEFAULT pursuant to a notice received from the TRUSTEE under Section 5.1 herein. 3.3 Payment ------- (a) In the event that the PURCHASER has made all payments required pursuant to the SHARE PURCHASE AGREEMENT, the TRUSTEE shall, subject to the provisions of paragraph 3.3(b) herein, forthwith redeliver to the PURCHASER, the SHARE CERTIFICATES then held by it, the transfer referred to in Section 2.3 and the directors resolution referred to in Section 2.4 herein; and (b) As evidence that the payments referred to in paragraph 3.3(a) have been made by the PURCHASER to the VENDORS, the PURCHASER shall forward to the TRUSTEE a sworn statutory declaration to that effect. Thereupon, the TRUSTEE shall give notice to the VENDORS that such declaration has been received and, if the VENDORS do not within fifteen (15) days advise the TRUSTEE that the payments referred to in such declaration have not been made, the TRUSTEE shall deliver the applicable SHARE CERTIFICATE representing such number of SHARES as are then releasable by the TRUSTEE to the PURCHASER. In the event that the VENDORS advise the TRUSTEE that the payments referred to in the above-noted statutory declaration have not been made, then the TRUSTEE shall not be required to deliver any share certificates without a written direction signed by both the VENDORS and the PURCHASER or an appropriate order of a court of competent jurisdiction. ARTICLE 4 - --------- 4.1 Security Enforceable --------------------- The security hereby constituted shall become enforceable: (a) if an Order is made or an effective resolution is passed for winding up the CORPORATION, unless such winding up is effected pursuant to a merger or amalgamation of the CORPORATION with any other corporation and is made with the prior written consent of the VENDORS, such consent to not be withheld unless such act would in the reasonable opinion of the VENDORS have a material adverse impact upon the value of the SHARES or the security granted herein; (b) if the PURCHASER, or the CORPORATION makes an assignment for the benefit of creditors or is declared bankrupt or if a receiver is appointed under the terms of the Bankruptcy and Insolvency Act (Canada), or if an execution or judgment against the property of the PURCHASER, or the CORPORATION or any part thereof remains after all appeals unsatisfied for a period of fifteen (15) days following notice from the VENDORS to the PURCHASER to satisfy same or if a receiver of all or any of the assets of the PURCHASER, or the CORPORATION is appointed; (c) if an effective resolution is passed for the sale by either the PURCHASER, or the CORPORATION of all or substantially all of its assets; (d) if the PURCHASER fails to make any payment on the INDEBTEDNESS within thirty (30) days of the date on which such payment is due pursuant to the SHARE PURCHASE AGREEMENT; (e) if the PURCHASER attempts to sell or entertain an offer to sell the SHARES without first obtaining the written consent of the VENDORS; or (f) if the PURCHASER or the CORPORATION commits any material breach pursuant to the SHARE PURCHASE AGREEMENT, or this AGREEMENT, and such breach continues for fifteen (15) days after written notice from the VENDORS to the PURCHASER specifying such breach or requiring the same to be remedied. ARTICLE 5 - --------- 5.1 Realization Against SHARES ---------------------------- The VENDORS may, at any time after an ACT OF DEFAULT and in addition to (and not in substitution for) all other rights and remedies available to the VENDORS, give notice to the TRUSTEE of default by the PURCHASER. Thereupon, the TRUSTEE shall give notice to the PURCHASER that such notice has been received and, if the PURCHASER does not within one hundred eighty (180) days cure such default, then the TRUSTEE shall deliver to the VENDORS the SHARE CERTIFICATE together with the transfer of same in favour of the VENDORS referred to in Section 2.3 and the resolutions of the directors referred to in Section 2.4 hereof, whereupon: (a) the VENDORS may forthwith without notice, without demand for payment, without advertisement and without any other formality, all of which are hereby waived by the PURCHASER, sell the SHARES by public or private sale using best efforts to obtain the maximum sum reasonably obtainable for the SHARES on the basis of a forced sale. Any such sale of all or any part of the SHARES shall be a sale either en bloc or in such part or parts and either by public auction or private contract and with or without any special condition as to upset price, reserve bid, title or evidence of title or other matter and from time to time as the VENDORS in their discretion determine, with power to vary or rescind any such contract or sale or buy in any such auction and resell without being answerable for any loss. The VENDORS may at any sale of the SHARES, or any part thereof, sell for a purchase consideration payable in cash or by instalments either with or without taking security for the second and subsequent instalments and may make delivery to the purchaser of good and sufficient deeds, assurances and conveyances of the SHARES and give receipts for the purchase price and any such sale shall be a perpetual bar, both at law and in equity, against the PURCHASER and all those claiming assets sold or any part thereof by, from, or under the PURCHASER. All costs and expenses incurred by the VENDORS in respect of the sale of all or any part of the SHARES shall be added to the obligations and liabilities of the PURCHASER to the VENDORS and shall be a first charge upon the monies received by the VENDORS as a result of any such sale or other dealing with all or any part of the SHARES. The proceeds realized from the sale of all or any part of the SHARES shall be applied by the VENDORS in respect of the INDEBTEDNESS without first making demand or taking any action whatsoever against the PURCHASER. If the proceeds are insufficient to satisfy in full the principal and interest due and payable to the VENDORS (including the costs and expenses of the sale of any SHARES), the unpaid balance shall be forgiven by the VENDORS. Any monies remaining after satisfaction in full of the INDEBTEDNESS and the obligations of the PURCHASER to the VENDORS pursuant to this AGREEMENT shall be paid by the VENDORS to the PURCHASER; (b) the VENDORS shall not be bound to sell or otherwise deal with all or any part of the SHARES or otherwise to realize any proceeds therefrom and shall not be responsible for any loss occasioned by any sale or other dealing with or any failure to sell or otherwise deal with all or any part of the SHARES; (c) at the sole and entire option of the VENDORS to be exercised by notice in writing to the PURCHASER at any time after delivery to the VENDORS of the SHARE CERTIFICATE, the VENDORS may accept the SHARES in full satisfaction of the INDEBTEDNESS; provided however where the VENDORS provide notice to the PURCHASER in accordance with this subsection 5.1 (c), the PURCHASER shall have 90 days from the date of receipt of such notice to redeem the SHARES by payment in full within that time of the INDEBTEDNESS; (d) the VENDORS may grant extensions, give up any or all of the SHARES, accept compositions, grant releases and discharges and otherwise deal with the SHARES, or any of them, and all parties hereto as they think fit without affecting the obligations and liability of the PURCHASER to the VENDORS under the SHARE PURCHASE AGREEMENT and under this AGREEMENT, without prejudice to any other rights which the VENDORS may have or may be entitled to take against the PURCHASER; (e) for the purposes of this Section 5.1 the VENDORS may have all or any of the SHARES registered in their names or in the name of their nominee and shall be entitled, but not bound or required, to vote the SHARES at any meeting at which the holder thereof is entitled to vote and, generally, to exercise any of the rights which the holder of the SHARES may, at any time, have including election of directors of the CORPORATION; but the VENDORS shall not be responsible for any loss occasioned by the exercise of any such rights or by the failure to exercise the same within the time limited for the exercise thereof; (f) the PURCHASER hereby irrevocably constitutes and appoints the VENDORS its true and lawful attorneys and agents-in-fact to do all acts and execute and deliver all such agreements, instruments and documents as the VENDORS may deem necessary and desirable to realize upon the security of the SHARES and agrees to ratify and confirm all such proper acts of the VENDORS as its attorney and to indemnify and save harmless the VENDORS from all claims, loss or damage suffered in so doing. 5.2 Other Legal Action -------------------- Nothing herein contained shall prevent or be construed as preventing the VENDORS from taking any legal action against the PURCHASER for collection of the amount due to the VENDORS pursuant to the SHARE PURCHASE AGREEMENT or for enforcing any other security given to the VENDORS under the SHARE PURCHASE AGREEMENT. 5.3 Reorganization -------------- If the SHARES or any of them are part of an amalgamation or are changed, classified or reclassified, subdivided, consolidated or converted into a different number or class of shares or otherwise, the shares or other securities resulting from such amalgamation, change, classification, reclassification, subdivision or conversion shall be delivered to and held by the VENDORS in place of the SHARES and the provisions hereof shall apply thereto. 5.4 Consent and Waiver -------------------- The CORPORATION hereby consents to the Hypothecation herein contained and agrees that it shall, upon receiving the SHARE CERTIFICATE from the VENDORS along with written instruction from the VENDORS, register the SHARES in the name of such transferee as shall be instructed by the VENDORS. The CORPORATION also agrees that any such transfer shall operate as a waiver of any lien on shares that the CORPORATION may have against the PURCHASER with respect to the SHARES. ARTICLE 6 - --------- 6.1 TRUSTEE's Fees --------------- The fees and expenses of the TRUSTEE for acting hereunder shall be borne by the PURCHASER provided that the TRUSTEE agrees not to charge a general administration fee for holding the SHARES but shall only charge fees for actual time expended whether a default has occurred or not. 6.2 TRUSTEE's Acceptance --------------------- The acceptance by the TRUSTEE for its duties and obligations under this Agreement is subject to the following terms and conditions which the parties to this Agreement hereby agree shall govern and control with respect to its rights, duties, liabilities and immunities: (a) the TRUSTEE shall not be responsible or liable in any manner whatever for the sufficiency, correctness, genuineness or validity or any security deposited with it; (b) the TRUSTEE shall be protected in acting upon any written notice, request, waiver, consent, receipt, statutory declaration or other paper or document furnished to it and signed by the PURCHASER or the VENDORS not only as to its execution and the validity and effectiveness of its provisions but also as to the truth and acceptability of any information therein contained, which it in good faith believes to be genuine; (c) except for acts of gross negligence or willful misconduct, the TRUSTEE shall not be liable for any act done or step taken or omitted by it, or for any mistake of fact or law, and the PURCHASER and the VENDORS jointly and severally indemnify the TRUSTEE in respect of all losses, costs, expenses or damages suffered by the TRUSTEE in connection with its duties hereunder; (d) the TRUSTEE may consult with and obtain advice from outside legal counsel or direction by a Court of competent jurisdiction in the event of any question as to any of the provisions hereof or its duties hereunder, and it shall incur no liability and shall be fully protected in acting in good faith in accordance with the opinion and instructions of such counsel. The cost of obtaining such services or directions shall be added to and be a part of the TRUSTEE's fee hereunder; (e) the TRUSTEE shall have no duties except those which are expressly set forth herein, and it shall not be bound by any notice of a claim or demand with respect thereto, or any waiver, modification, amendment, termination or rescission of this Hypothecation Agreement, unless received by it in writing and signed by the PURCHASER and the VENDORS and, if its duties herein are affected, unless it shall have given its prior written consent thereto; and (f) the TRUSTEE may resign as escrow agent by giving sixty (60) days written notice of such resignation to all other parties to this Agreement and arranging for the SHARE CERTIFICATES to be delivered to a successor escrow agent agreed upon by all of the other parties to this Agreement. ARTICLE 7 - --------- 7.1 Notices ------- Any notice required to be given hereunder by any party shall be deemed to have been well and sufficiently given if: (a) personally delivered to the party to whom it is intended or if such party is a corporation to an officer of that corporation; or (b) if mailed by prepaid registered mail, to the address of the party to whom it is intended hereinafter set forth. (i) if to the VENDORS: Patricia Kirkham and Dennis Petersen c/o #204, 1109 - 17th Avenue S.W. Calgary, Alberta, T2T 5R9 (ii) if to the PURCHASER: EFinancial Depot.com, Inc. 150-1875 Century Park East Century City, California, U.S.A. 90067 (iii) if to the CORPORATION: Westcor Mortgage Inc. #204, 1109 - 17th Avenue S.W. Calgary, Alberta T2T 5R9 (iv) if to the TRUSTEE: Miller Thomson 3000, 700 - 9th Avenue S.W. Calgary, Alberta T2P 3V4 ATTENTION: Michael F. Hayduk, Q.C. or to such other address as a party may from time to time direct in writing. Any notice delivered as aforesaid shall be deemed to have been received on the date of delivery and any notice mailed shall be deemed to have been received seventy-two (72) hours after the time of mailing. If normal mail service is interrupted by strike, slow-down, force majeure or other cause after the notice has been sent the notice will not be deemed to be received until actually received. In the event normal mail service is impaired -at the time of sending the notice, then personal delivery only shall be effective. 7.2 Headings -------- The headings are inserted for the purpose of convenience only and do not form part of this Agreement. 7.3 Enurement --------- This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns. 7.4 Further Assurances ------------------- The parties hereto and each of them do hereby covenant and agree to do such things and execute such further documents, agreements and assurances as may be necessary or advisable from time to time in order to carry out the terms and conditions of this Agreement in accordance with their true intent. 7.5 Execution --------- This Agreement may be executed in several parts of the same form and the parts as so executed shall together constitute one original agreement, and the parts, if more than one, shall be read together and construed as if all the signing parties hereto had executed one copy of this Agreement IN WITNESS WHEREOF the parties hereto have executed these presents on the day and year first above written. /s/ signed /s/ Patricia Kirkham Witness PATRICIA KIRKHAM /s/ signed /s/ Dennis Petersen Witness DENNIS PETERSEN EFINANCIAL DEPOT.COM, INC. Per: /s/ John Huguet WESTCOR MORTGAGE INC. Per: /s/ Patricia Kirkham MILLER THOMSON Per: /s/ signed Per: /s/ signed EX-2.5 6 0006.txt ESCROW AGREEMENT [NOTE: RISK TO SECURITYHOLDERS OF SHAREHOLDERS VOTE, LIQUIDATION, DIVIDEND PAYMENTS, ETC., DURING THE ESCROW PERIOD]. THIS AGREEMENT is dated for reference the 29th day of February 2000. AMONG: EFINANCIAL DEPOT.COM, INC., (herein called the "Issuer") - and - CLARK, WILSON, (herein called the "Escrow Agent") - and - PATRICIA KIRKHAM AND DENNIS PETERSEN, (herein called the "Securityholders") - and - OXFORD CAPITAL CORP., (herein called "Oxford") - and - WESTCOR MORTGAGE INC., (herein called "Westcor") WHEREAS the Securityholders and the Issuer entered into a Share Purchase Agreement dated for reference on February 29, 2000 (the "Share Purchase Agreement") whereby the Securityholders agreed to sell certain Class A shares of Westcor Mortgage Inc. to the Issuer and to enter into other related agreements dealing with certain Westcor exchangeable shares (the "Exchangeable Shares"). AND WHEREAS Oxford and Westcor entered into a Consulting Agreement dated February 28, 2000, whereby, among other things, Oxford is to receive shares of the Issuer ("Oxford's Shares"). AND WHEREAS the number of Exchangeable Shares which should be issued by Westcor will be unknown at the time that they are to be issued, but it is intended to be a number of Exchangeable Shares equal to 295,520 less [80% of any adjustment to the stockholders' equity between the January 31, 2000, unaudited, management-prepared financial statements of Westcor (the "January Financial Statements") and the audited financial statements of Westcor as at February 29, 2000, which are yet to be prepared (the "Audited Financial Statements") divided by the Deemed Share Price (as defined in the Share Purchase Agreement)]. AND WHEREAS the number of Oxford's Shares which should be issued by the Issuer will be unknown at the time that they are to be issued, but it is intended to be a number of common shares of the Issuer equal to 73,880 less [20% of any adjustment to the stockholders' equity between the January Financial Statements and the Audited Financial Statements divided by the Deemed Share Price (as defined in the Share Purchase Agreement)]. AND WHEREAS the number of Exchangeable Shares to be issued by Westcor (pending adjustment) and the names of the Securityholders intended to receive such securities are more particularly described in Schedule "A" attached to and forming part of this Agreement, and Oxford's Shares (pending adjustment) are more particularly described in Schedule "B" attached to and forming part of this Agreement; AND WHEREAS the Escrow Agent has agreed to undertake and perform its duties according to the terms and conditions hereof; NOW THEREFORE this Agreement witnesses that, in consideration of the sum of One ($1.00) Dollar paid by the parties to each other, and other good and valuable consideration, receipt of which is acknowledged by each of the parties, the parties covenant and agree with each other as follows: 1. Upon execution of this Escrow Agreement, the Issuer will issue to Oxford 73,880 Common Stock shares in EFinancial Depot.com, Inc. Oxford's Shares will be these 73,880 Common Stock shares pending adjustment pursuant to this Agreement. 2. Each of the Securityholders and Oxford (collectively the "Depositors") hereby place and deposit in escrow with the Escrow Agent the Exchangeable Shares and Oxford's Shares, respectively, which are represented by the certificates described in Schedule "A" and Schedule "B", respectively, (the "Escrowed Securities") and the Escrow Agent hereby acknowledges receipt of the Escrowed Securities. The Depositors further undertake and agree to deliver to the Escrow Agent immediately on receipt thereof the certificates (if any) for any further securities and any replacement certificates which may at any time be issued for any of the Escrowed Securities. 3. Each of the Depositors shall be entitled to a receipt from the Escrow Agent stating the type and number of securities held for that Depositor by the Escrow Agent subject to the terms of this Agreement. It is expressly understood and agreed by the parties hereto that such receipt shall not be assignable or transferrable. 4. The Parties hereby agree that the Escrowed Securities and the beneficial ownership of or any interest in them and the certificates representing them (including any replacement securities or certificates) shall remain in escrow and shall be released only in accordance with the terms hereof. 5. The Depositors direct the Escrow Agent to retain their respective securities and the certificates (including any replacement securities or certificates) representing them and not to do or cause anything to be done to release them from escrow or to allow any transfer, hypothecation or alienation thereof, without the written consent of the Issuer and the Depositors. 6. The Issuer shall cause Westcor to complete the Audited Financial Statements as soon as is practical and, in any event, on or before June 30, 2000, and the Securityholders agree to co-operate in the completion of such audit. 7. The Audited Financial Statements shall be prepared and audited by Ernst & Young (or some other accounting firm acceptable to the Issuer and the Securityholders) (the "Auditors") on a basis consistent with the January Financial Statements. 8. Westcor shall provide the Audited Financial Statements to the Issuer and to the Depositors as soon as they are available. Thereafter the Issuer and the Securityholders shall meet and determine the net difference, if any, in the assets and liabilities of Westcor between the January Financial Statements and the Audited Financial Statements. The comparison of the difference between the assets, liabilities and stockholders' equity of these two financial statements shall exclude, for both sets of financial statements, any sums shown as due to Westcor from the Securityholders. 9. Should this comparison show a reduction in the stockholders' equity between the January Financial Statements and the Audited Financial Statements, then some of the Exchangeable Shares issued to the Securityholders shall be returned to Westcor for cancellation, and some of Oxford's Shares will be returned to the Issuer for cancellation. The number of Escrowed Securities to be returned for cancellation shall be calculated as follows: absolute value of (A-B) ----------------------- P = X where: "A" means the stockholders' equity in the January Financial Statements; "B" means the stockholders' equity in the Audited Financial Statements; "P" means the Deemed Share Price (as defined in the Share Purchase Agreement); "X" means the number of Escrowed Securities to be returned for cancellation, 80% of X is the number of Exchangeable Shares to be returned to Westcor by the Securityholders, and 20% of X is the number of Oxford's Shares to be returned to the Issuer by Oxford. 10. The Issuer and the Securityholders shall review and discuss the Audited Financial Statements and shall settle the number of Escrowed Securities to be cancelled, if any, as soon as is practical and, in any event, on or before July 15, 2000. Should the Issuer and the Securityholders agree on the number of Escrowed Securities to be cancelled, if any, then they shall provide a written direction to the Escrow Agent signed by each of the Depositors instructing the Escrow Agent to return to Westcor and the Issuer for cancellation the agreed upon number of Escrowed Securities, if any, and to immediately release to the Depositors the balance of the Escrowed Securities. Oxford agrees to sign such a written direction. Westcor agrees to cancel the shares returned to it for cancellation and to issue to the Securityholders new share certificates for the remaining Exchangeable Shares. Any shares to be returned to treasury shall be returned in equal number from the holdings of each of the Securityholders. The Issuer agrees to cancel the shares returned to it for cancellation and to issue to Oxford a new share certificate for the remaining Oxford's Shares. 11. Should the Issuer and both the Securityholders not be able to agree on the number of Escrowed Securities to be cancelled, then any of them may request the auditor that performed the audit of the Audited Financial Statements to calculate the difference in the manner set out in this Agreement, acting reasonably, and such calculation shall be final and binding upon the parties. Such calculation shall be completed on or before August 15, 2000, and the results provided to the Issuer, the Depositors and the Escrow Agent. 12. No fractional shares shall be cancelled. Any shares which the above calculation may require be cancelled shall be rounded down to the next lowest whole share and those whole shares only shall be cancelled. 13. In the event of bankruptcy or death of a Depositor, the Escrow Agent, upon receipt of written notification by the Issuer, may transmit that Depositor's securities by operation of law to the trustee in bankruptcy, personal representative or surviving joint tenant as the case may be, but, notwithstanding such transmission, the securities shall remain subject to the terms of this Agreement. 14. Notwithstanding any other terms of this Agreement, any Escrowed Securities not released from escrow in accordance with the terms of this Agreement before August 15, 2000, shall be released to the Depositors forthwith thereafter, and the Issuer and the Escrow Agent hereby undertake and agree to take all actions as may be necessary to expeditiously effect such release. 15. For the purposes of effecting a cancellation of Escrowed Securities pursuant to paragraphs 10 or 11 the Depositors hereby irrevocably appoint the Escrow Agent as their attorney for the purposes of cancelling the Escrowed Securities, with authority to substitute one or more persons or entities with like powers. 16. All voting rights attached to the Escrowed Securities shall at all times be exercised by the respective registered owners thereof. 17. The Depositors agree that, while any of their securities are held in escrow under this Agreement, they will not vote any of their securities (whether escrowed or not) in support of any arrangement that would result in a repayment of capital being made on the Escrowed Securities prior to the commencement of any winding up of Westcor. 18. Compensation & Indemnification (a) The Issuer agrees to pay to the Escrow Agent reasonable compensation for all of the services rendered by it under this Agreement and will reimburse the Escrow Agent for all reasonable expenses (including but not limited to taxes, compensation paid to experts, agents, advisors, and travel expenses) and disbursements, including the cost and expense of any suit or litigation of any character and any proceedings before any governmental agency reasonably incurred by the Escrow Agent in connection with its rights and duties under this Agreement; provided that the Issuer shall have no obligation to reimburse the Escrow Agent for any expenses or disbursements paid, incurred or suffered by the Escrow Agent in any suit or litigation in which the Escrow Agent is determined to have acted with gross negligence or wilful misconduct. (b) Indemnification of the Escrow Agent. Subject to paragraph 18(a) above, the Issuer and the Securityholders jointly and severally agree to indemnify and hold harmless the Escrow Agent, its partners, employees, agents, successors and assigns (collectively, the "Indemnified Parties") against all claims, losses, damages, costs, penalties, and fines (including reasonable expenses of the legal counsel on a solicitor-and-his-own-client basis) which, without gross negligence or willful misconduct on the part of such Indemnified Party, may be paid, incurred or suffered by the indemnified Party by reason of or as a result of the Escrow Agent's acceptance or administration of the Trust, its compliance with its duties set forth in this Agreement, or any written or oral instructions delivered to the Issuer and the Securityholders pursuant hereto. In no case shall either of the Securityholders or the Issuer be liable under this indemnity for any claim against any of the Indemnified Parties unless the Issuer and the Securityholders shall be notified by the Escrow Agent of the written assertion of a claim or of any action commenced against the Indemnified Parties, promptly after any of the Indemnified Parties shall have received any such written assertion of a claim or shall have been served with a summons or other first legal process giving information as to the nature and basis of the claim. Subject to (ii), below, the Issuer and the Securityholders shall be entitled to participate at their own expense in the defence and, if the Issuer and the Securityholders so elect at any time after receipt of such notice, either of them may assume the defence of any suit brought to enforce any such claim. The Escrow Agent shall have the right to employ separate counsel in any such suit and participate in the defence thereof but the fees and expenses of such counsel shall be at the expense of the Escrow Agent unless: (i) the employment of such counsel has been authorized by the Issuer and the Securityholders, such authorization not to be unreasonably withheld; or (ii) the named parties to any such suit include both the Escrow Agent and at least one of the Issuer and the Securityholders and the Escrow Agent shall have been advised by counsel acceptable to the Issuer and the Securityholders that there may be one or more legal defences available to the Escrow Agent that are different from or in addition to those available to the Issuer and the Securityholders and that an actual or potential conflict exists (in which case the Issuer and the Securityholders shall not have the right to assume the defense of such suit on behalf of the Escrow Agent but shall be liable to pay the reasonable fees and expenses of counsel for the Escrow Agent). (c) Limitation of Liability. The Escrow Agent shall not be held liable for any loss which may occur by reason of depreciation of the value of any part of the Escrowed Securities or any loss incurred on any investment of funds pursuant to this Agreement except to the extent that such loss is attributable to the gross negligence or willful misconduct on the part of the Escrow Agent. 19. The Escrow Agent accepts the responsibilities placed on it by this Agreement and agrees to perform them in accordance with the terms of this Agreement and the written consents or directions of the Issuer and the Depositors. 20. The Issuer hereby acknowledges the terms and conditions of this Agreement and agrees to take all reasonable steps to facilitate its performance and to pay the Escrow Agent's proper charges for its services under this Agreement. 21. In the event the Escrow Agent wishes to resign, retire or otherwise terminate its obligations pursuant to this Agreement, it shall be required to provide at least thirty (30) days written notice to the Issuer. Upon receipt of such notice the Issuer may, with the written consent of the Depositors, by writing, appoint another Escrow Agent in its place and the new Escrow Agent shall assume and be bound by the obligations of the Escrow Agent hereunder. 22. This Agreement may be executed in several parts of the same form and the parts as so executed shall together constitute one original agreement, and the parts, if more than one, shall be read together and construed as if all the signing parties hereto had executed one copy of this Agreement. 23. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision (whether similar or not), nor shall any waiver constitute a continuing waiver, unless expressly provided. 24. This Agreement shall be interpreted in accordance with and governed in all respects by the laws of the Province of Alberta. The courts of Alberta shall have non-exclusive jurisdiction to entertain any action or proceeding brought by or against any of the parties hereto in connection with this Agreement or any alleged breach thereof and the parties hereby expressly agree to attorn to the jurisdiction of such courts for that purpose. 25. This Agreement shall be read with all changes in gender or number as the context may require, and the word "person" or "persons" as used in this Agreement shall be deemed to include firms, partnerships, corporations and associations as well as natural persons. Further, the term "Depositors" shall include any permitted transferees within escrow and any person to whom the interest of a Depositor may be transmitted by operation of law as provided herein, and the term "Escrow Agent" shall include a new Escrow Agent appointed under this Agreement, and whenever the singular or masculine is used, the same shall be construed to include the plural, feminine, neuter, or a corporate or other entity where the context so requires. 26. Any provision or any portion of any provision or provisions of this Agreement determined by a court of competent jurisdiction to be invalid, illegal or unenforceable shall be deemed stricken to the extent necessary to eliminate any invalidity, illegality or unenforceability and the rest of the Agreement and all other provisions and parts thereof shall remain in full force and effect and be binding upon the parties hereto as though the said illegal or unenforceable provision or provisions or part or parts thereof had never been included in this Agreement. 27. The parties hereby confirm and ratify the matters contained and referred to in the preamble to this Agreement and agree that same are expressly incorporated into and form part of this Agreement. 28. This Agreement shall enure to the benefit of and be binding on the parties to this Agreement and each of their heirs, executors, administrators, successors, and assigns. IN WITNESS WHEREOF the Issuer, the parties have executed this Agreement effective as of February 29, 2000. EFINANCIAL DEPOT.COM, INC. Per: /s/ John Huguet CLARK WILSON Per: /s/ signed Per: OXFORD CAPITAL CORP. Per: /s/ signed WESTCOR MORTGAGE INC. Per: /s/ Patricia Kirkham WITNESSES SECURITYHOLDERS /s/ signed /s/ Patricia Kirkham PATRICIA KIRKHAM /s/ signed /s/ Dennis Petersen DENNIS PETERSEN SCHEDULE "A" TO THE ESCROW AGREEMENT DATED FOR REFERENCE THE 29TH DAY OF FEBRUARY 2000. NAMES OF TYPE OF NUMBER OF SHARE CERT- DEPOSITOR SECURITIES SECURITIES IFICATE NUMBER --------- ---------- ---------- ------------------------ Patricia Kirkham Exchangeable Shares of Westcor 147,760 3ES - ----------------- --------------------------------- ------- --- Dennis Petersen Exchangeable Shares of Westcor 147,760 4ES ================ ================================= ======= === SCHEDULE "B" TO THE ESCROW AGREEMENT DATED FOR REFERENCE THE 29TH DAY OF FEBRUARY 2000. NAMES OF TYPE OF NUMBER OF SHARE CERT- DEPOSITOR SECURITIES SECURITIES IFICATE NUMBER --------- ---------- ---------- ------------------------ EFinancial Depot.com, Inc. Oxford Common Stock shares 73,880 # ______ - ------ --------------------- ------ ------------ -----END PRIVACY-ENHANCED MESSAGE-----