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EXHIBIT 6.2
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CO-SALE AGREEMENT
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This Co-Sale Agreement is made as of the 19th day of October, 1998 by and among
LAS VEGAS DISCOUNT GOLF & TENNIS INC. (the "Company"), a Colorado corporation,
XXX XXXXXX, XXXX XXXXXX and XXXX XXXXXX (collectively the "Boretas") and BORETA
ENTERPRISES LTD. (the "Family Company"; the Family Company and the Boretas are
each a "Significant Shareholder," and collectively are the "Significant
Shareholders") and ASI GROUP, L.L.C., a Nevada limited liability company
("ASI").
In consideration of the mutual covenants set forth herein, the parties agree as
follows:
1. DEFINITIONS.
(a) "Stock" shall mean shares of the Company's Common and
Preferred Stock now owned beneficially or of record or
subsequently acquired beneficially or of record directly or
indirectly by the Significant Shareholders.
(b) "Preferred Stock" shall mean the Company's or LVDG&T's
outstanding Preferred Stock of any series or designation.
(c) "Common Stock" shall mean the Company's Common Stock and
shares of Common Stock issued or issuable upon conversion of
the Company's Preferred Stock.
2. SALE BY SIGNIFICANT SHAREHOLDERS.
(a) On each occasion that any Significant Shareholder proposes to
sell or transfer to any person any shares of Stock in one or
more related transactions, such Significant Shareholder shall
promptly give written notice (the "Notice") to ASI at least
twenty (20) days prior to the closing of such sale or
transfer. The Notice shall describe in reasonable detail the
proposed sale or transfer including, without limitation, the
number of shares of Stock to be sold or transferred, the
nature of such sale or transfer, the consideration to be paid,
and the name and address of each prospective purchaser or
transferee. In the event that the sale or transfer is being
made pursuant to the provisions of Section 3(a) or 3(b)
hereof, the Notice shall state under which Section the sale or
transfer is being made.
(b) ASI shall have the right, exercisable upon written notice to
such Significant Shareholder within fifteen (15) days after
receipt of the Notice, to participate in such sale of Stock on
the same terms and conditions. To the extent ASI exercises
such right of participation in accordance with the terms and
conditions set forth
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below, the number of shares of Stock that the Significant
Shareholder may sell in the transaction shall be
correspondingly reduced.
(c) ASI may sell all or any part of that number of shares of
Common Stock equal to the product obtained by multiplying (i)
the aggregate number of shares of Stock covered by the Notice
by (ii) a fraction the a numerator of which is the number of
shares of Common Stock owned by ASI at the time of the sale or
transfer and the denominator of which is the total number of
shares of Common Stock owned by the Significant Shareholders
and ASI at the time of the sale or transfer.
(d) ASI shall effect its participation in the sale by promptly
delivering to the Significant Shareholders for transfer to the
prospective purchaser one or more certificates, properly
endorsed for transfer, which represent:
(i) the type and number of shares of Common Stock which
ASI elects to sell; or
(ii) that number of shares of Series B Convertible
Preferred Stock which is at such time convertible
into the number of shares of Common Stock which ASI
elects to sell; provided, however, that if the
prospective purchaser objects to the delivery of
Series B Convertible Preferred Stock in lieu of
Common Stock, ASI shall convert such Preferred Stock
into Common Stock and deliver Common Stock as
provided in Section 2(d)(i) above. The Company agrees
to make any such conversion concurrent with the
actual transfer of such shares to the purchaser.
(e) The Stock certificate or certificates that ASI delivers to the
Significant Shareholders pursuant to Section 2(d) shall be
transferred to the prospective purchaser in consummation of
the sale of the Common Stock pursuant to the terms and
conditions specified in the Notice, and the Significant
Shareholders shall concurrently therewith remit to ASI that
portion of the sale proceeds to which ASI is entitled by
reason of its participation in such sale. To the extent that
any prospective purchaser or purchasers prohibits such
assignment or otherwise refuses to purchase shares or other
securities from ASI, the Significant Shareholders shall not
sell to such prospective purchaser or purchasers any Stock
unless and until, simultaneously with such sale, the
Significant Shareholders shall purchase such shares or other
securities from ASI.
(f) The exercise or non-exercise of the rights of ASI hereunder to
participate in one or more sales of Stock made by the
Significant Shareholders shall to adversely affect its rights
to participate in subsequent sales of Stock subject to Section
2(a).
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3. EXEMPT TRANSFERS.
Notwithstanding the foregoing, the co-sale rights of ASI shall not apply to (a)
any pledge of Stock made pursuant to a bona fide third party loan transaction
with a party not affiliated with or a stockholder of any significant shareholder
that creates a mere security interest; (b) any transfer to the ancestors,
descendants or spouse or to trusts for the benefit of such persons or a
Significant Shareholder; (c) any bona fide gift; or (d) any sale or sales of not
more than 25,000 shares of Common Stock individually or in the aggregate during
the term hereof (as adjusted for stock splits, reverse stock splits and the like
effected after the date of this Agreement); provided that (i) the transferring
Shareholder shall inform ASI of such pledge, transfer or gift prior to effecting
it and (ii) the pledgee, transferee or donee shall furnish ASI with a written
agreement to be bound by and comply with all provisions of Section 2. Such
transferred Stock shall remain "Stock: hereunder, and such pledge, transferee or
donee shall be treated as a "Shareholder" for purposes of this Agreement.
4. PROHIBITED TRANSFERS.
(a) In the event a Significant Shareholder should sell any Stock
in contravention of the co-sale rights of ASI under this
Agreement (a "Prohibited Transfer"), ASI, in addition to such
other remedies as may be available at law, in equity or
hereunder, shall have the put option provided below, and the
Significant Shareholders shall be bound by the applicable
provisions of such option.
(b) In the event of a Prohibited Transfer, ASI shall have the
right to sell to the Significant Shareholders the type and
number of shares of Common Stock equal to the number of shares
ASI would have been entitled to transfer to the purchaser had
the Prohibited Transfer under Section 2(c) hereof been
effected pursuant to and in compliance with the terms hereof.
Such sale shall be made on the following terms and conditions:
(i) The price per share at which the shares are to be
sold to the Significant Shareholders shall be equal
to the price per share paid by the purchaser to
Significant Shareholders in this Prohibited Transfer.
Significant Shareholders shall also reimburse ASI for
any and all fees and expenses, including legal fees
and expenses, incurred pursuant to the exercise or
the attempted exercise of ASI's rights under Section
2.
(ii) Within ninety (90) days after the later of the dates
on which ASI (A) received notice of the Prohibited
Transfer or (B) otherwise became aware of the
Prohibited Transfer, ASI shall, if exercising the
option created hereby, deliver to Significant
Shareholders the certificate or certificates
representing shares to be sold, each certificate to
be properly endorsed for transfer.
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(iii) Significant Shareholders shall, upon receipt of the
certificate or certificates for the shares to be sold
by ASI, pursuant to this Section 4(b), pay the
aggregate purchase price therefor and the amount of
reimbursable fees and expenses, as specified in
Section 5(b)(i), in cash or by other means acceptable
to ASI.
(iv) Notwithstanding the foregoing, any attempt by a
Significant Shareholder to transfer Stock in
violation of Section 2 hereof shall be void and the
Company agrees it will not effect such a transfer nor
will it treat any alleged transferee as the holder of
such shares without the written consent of ASI.
5. LEGEND.
(a) Each certificate representing shares of Stock now or hereafter
owned by the Significant Shareholder or issue to any person in
connection with a transfer pursuant to Sections(a) and 3(b)
hereof shall be endorsed with the following legend:
"THE SALE, PLEDGE, HYPOTHECATION OR TRANSFER OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT
TO THE TERMS AND CONDITIONS OF A CERTAIN CO-SALE
AGREEMENT AMONG THE INITIAL HOLDER OF THE SECURITIES,
THE COMPANY AND CERTAIN STOCKHOLDER(S) OF THE
COMPANY. COPIES OF SUCH AGREEMENT MAY BE OBTAINED
UPON WRITTEN REQUEST TO THE SECRETARY OF THE
COMPANY."
(b) Each Significant Shareholder agrees that the Company may
instruct its transfer agent to impose transfer restrictions on
the shares represented by certificates bearing the legend
referred to in Section 5(a) above to enforce the provisions of
this Agreement and the Company agrees to promptly do so. The
legend shall be removed upon termination of this Agreement.
6. MISCELLANEOUS.
6.1 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of Nevada.
6.2 AMENDMENT. Any provision may be amended and the observance thereof
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only by the written consent of the party or
parties affected thereby. Any amendment or waiver effected in accordance with
clauses (a), (b) and (c) of this Section shall be binding upon ASI, its
successors and assigns, the Company and Significant Shareholders in question.
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6.3 ASSIGNMENT OF RIGHTS. This Agreement and the rights and obligations
of the parties hereunder shall inure to the benefit of, and be binding upon,
their respective successors, assigns and legal representatives.
6.4 TERM. This Agreement shall terminate on the fifth anniversary
hereof.
6.5 OWNERSHIP. Each Significant Shareholder represents and warrants
that it/he is the sole legal and beneficial owner of the shares of stock subject
to this Agreement and that no other person has any interest (other than a
community property interest) in such shares.
6.6 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given upon personal delivery to the
party to be notified or five (5) days after deposit in the United States mail,
by registered or certified mail, postage prepaid and properly addressed to the
party to be notified as set forth on the signature page hereof or at such other
address as such party may designate by ten (10) days' advance written notice to
the other parties hereto.
6.7 SEVERABILITY. In the event one or more of the provisions of this
Agreement should, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Agreement, and this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein.
6.8 ATTORNEY FEES. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.9 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
The foregoing agreement is hereby executed as of the date first above written.
SAINT XXXXXXX GOLF
CORPORATION, a Nevada corporation ASI GROUP, L.L.C., a Nevada
limited liability company
By /s/ Xxx Xxxxxx By: Sunbelt Communications Company,
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Name: Xxx Xxxxxx a Member
Title: President
By /s/ Xxxxx Xxxx Xxxxxx
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Name: Xxxxx Xxxx Xxxxxx
Title: President
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LAS VEGAS DISCOUNT GOLF
& TENNIS INC.,
a Nevada corporation
By /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Title: President
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
/s/ Xxx Xxxxxx
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Xxx Xxxxxx
/s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
BORETA ENTERPRISES LTD.
By /s/ Xxx Xxxxxx
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Name: Xxx Xxxxxx
Title: General Partner
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CONSENT OF SPOUSE
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I acknowledge that I have read the foregoing Agreement and that I know its
contents. I am aware that by its provisions if I and/or my spouse agree to sell
all or part of the shares of the company held of record by either or both of us,
including my community property interest in such shares, if any, co-sale rights
(as described in the Agreement) must be granted to ASI by the seller. I hereby
agree that those shares and my interest in them, if any, are subject to the
provisions of the Agreement and that I will take no action at any time to hinder
operations of, or violate, the Agreement.
/s/ Xxxx Xxxxxx
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(Signature) Xxxx Xxxxxx
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CONSENT OF SPOUSE
I acknowledge that I have read the foregoing Agreement and that I know its
contents. I am aware that by its provisions if I and/or my spouse agree to sell
all or part of the shares of the company held of record by either or both of us,
including my community property interest in such shares, if any, co-sale rights
(as described in the Agreement) must be granted to ASI by the seller. I hereby
agree that those shares and my interest in them, if any, are subject to the
provisions of the Agreement and that I will take no action at any time to hinder
operations of, or violate, the Agreement.
/s/ Xxxxxx Xxxxxx
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(Signature) Xxxxxx Xxxxxx
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CONSENT OF SPOUSE
I acknowledge that I have read the foregoing Agreement and that I know its
contents. I am aware that by its provisions if I and/or my spouse agree to sell
all or part of the shares of the company held of record by either or both of us,
including my community property interest in such shares, if any, co-sale rights
(as described in the Agreement) must be granted to ASI by the seller. I hereby
agree that those shares and my interest in them, if any, are subject to the
provisions of the Agreement and that I will take no action at any time to hinder
operations of, or violate, the Agreement.
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(Signature)
