RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT ("Agreement") is made and entered
into as of August 8, 1997, by and among Midwest Facility Investments, Inc., a
Florida corporation ("Facility"), Penske Motorsports, Inc., a Delaware
corporation ("PMI") (collectively, Facility and PMI shall be referred to as the
"Purchasers"), and each of the individuals listed on Schedule I hereto
(individually a "Shareholder" and collectively the "Shareholders").
RECITALS
A. This Agreement is entered into in connection with (i) that certain
Stock Purchase Agreement, dated as of August 8, 1997 (the "Stock Purchase
Agreement"), between Facility and Grand Prix Association of Long Beach, Inc., a
California corporation (the "Corporation"), pursuant to which Facility is
contemporaneously acquiring 315,000 shares of common stock, no par value
("Common Stock"), of the Corporation (together with any and all other shares of
the Corporation's Common Stock that may be acquired by Facility in the future,
the "Facility Shares") and (ii) that certain Stock Purchase Agreement, dated as
of August 8, 1997, between PMI and the Corporation (the "PMI Stock Purchase
Agreement") (collectively, the Facility Stock Purchase Agreement and the PMI
Stock Purchase Agreement shall be referred to as the "Stock Purchase
Agreements"), pursuant to which PMI is contemporaneously acquiring 315,000
shares of Common Stock of the Corporation (together with any and all other
shares of the Corporation's Common Stock that may be acquired by PMI in the
future, the "PMI Shares") (collectively, the Facility Shares and the PMI Shares
shall be referred to as the "Purchased Shares").
B. The Shareholders own collectively 1,403,632 shares of common stock
of the Corporation as of the date hereof (together with any and all other shares
of the Corporation's capital stock that may be acquired by any of the
Shareholders in the future, the "Shareholder Shares").
C. Following consummation of the transactions contemplated by Stock
Purchase Agreements, Facility will own 7.2 percent of the issued and outstanding
shares of the Corporation Common Stock, PMI will own 7.2 percent of the issued
and outstanding shares of the Corporation Common Stock and the Shareholders will
own collectively 37.2 percent of the issued and outstanding shares of the
Corporation Common Stock.
D. As a condition to the willingness of Facility, PMI and the
Corporation to enter into the Stock Purchase Agreements, Facility, PMI and the
Corporation have each requested that the Shareholders agree, and in order to
induce Facility, PMI and the Corporation to enter into the Stock Purchase
Agreements, the Shareholders, Facility and PMI have agreed to place certain
restrictions upon the right of transfer of their respective interests in the
Corporation.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth in this Agreement and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, Facility, PMI and each
Shareholder agree as follows:
ARTICLE ONE
REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS
Each Shareholder hereby severally represents and warrants to the
Purchasers as follows (as to such Shareholder only):
(a) AUTHORITY. Such Shareholder has the power and authority to execute
this Agreement and perform such Shareholder's obligations hereunder. This
Agreement has been duly
executed and delivered by such Shareholder and (assuming the due execution and
delivery hereof by the Purchasers) constitutes a valid and binding obligation of
such Shareholder enforceable against such Shareholder in accordance with its
terms, except to the extent that its enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other laws affecting the enforcement
of creditors' rights generally or by general equitable principles.
(b) NO BREACH. The execution, delivery and performance by such
Shareholder and the consummation of the transactions contemplated hereby and
thereby: (i) do not and will not violate or conflict with any provision of law
or regulation, or any writ, order, judgment or decree of any court or
governmental or regulatory authority specifically naming such Shareholder; and
(ii) do not and will not, with or without the passage of time or the giving of
notice, result in the breach of, or constitute a default, cause the acceleration
of performance, permit the unilateral modification or termination of, or require
any consent under, or result in the creation of any lien, charge or encumbrance
upon any property or assets of such Shareholder pursuant to, any material
instrument or agreement to which such Shareholder is a party or by which such
Shareholder may be bound or affected, except in each case where the violation,
breach, default, modification, termination, absence of consent or lien could not
reasonably be expected to impair such Shareholder's timely and complete
performance of his obligations hereunder.
(c) OWNERSHIP. The Shareholder Shares set forth opposite such
Shareholder's name on SCHEDULE 1, hereto are owned by such Shareholder, free and
clear of any liens, encumbrances, security interests, options or claims,
including, without limitation, claims or rights under "buy-sell" or other
shareholder agreements (other than this Agreement and other liens heretofore
disclosed in writing to Purchasers).
ARTICLE TWO
RESTRICTIONS IMPOSED UPON THE
TRANSFER OF STOCK BY THE SHAREHOLDERS
2.1 GENERAL PROHIBITION ON TRANSFERS. Except as is specifically
permitted by the provisions of this ARTICLE TWO, the sale, assignment, pledge,
gift, transfer or other disposition of any of Shareholder's "Stock" (as defined
in Section 6.13 hereof), either directly or indirectly, to any person or entity,
is prohibited.
2.2 PERMITTED TRANSFERS. The following transfers of Stock shall be
permitted transfers which do not require the giving of a Notice of Right of
First Refusal under Section 2.3 of this ARTICLE TWO.
(a) TRANSFERS WITH CONSENT. Notwithstanding the provisions of Section
2.1, a transfer or disposition of any kind or character otherwise prohibited by
this ARTICLE TWO may be permitted if approved by each of the Purchasers.
(b) TRANSFERS TO FAMILY MEMBERS. Notwithstanding the provisions of
Section 2.1, each Shareholder shall be permitted to transfer (whether by
purchase, assignment, gift, bequest, devise, levy, execution or other means of
transfer) all or any portion of his or her Stock to (i) his or her spouse or any
family members, (ii) any custodian, guardian or other representative for a
spouse or family members, and/or (iii) the trustee of any trust created for the
benefit of the Shareholder, his or her spouse and/or family members
(collectively the "Permitted Family Transferees") provided that each and every
such Permitted Family Transferee executes a written acknowledgment that (i) all
Stock held by the Permitted Family Transferee will, notwithstanding the transfer
to such Permitted Family Transferee, be deemed for all purposes of this
Agreement to be owned by the transferring Shareholder, and (ii) the Permitted
Family Trustee is to be bound by all of the terms of this Agreement as if a
signatory "Shareholder" hereto.
(c) BONA FIDE PLEDGE. Notwithstanding the provisions of Section 2.1, a
Shareholder shall be entitled to make a bona fide pledge of his or her stock to
a financial institution or broker in
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connection with borrowing transactions (each a "Lender"); provided, however,
that, as contemplated by Section 2.4 hereof, any transfer of Stock to the Lender
pursuant to such arrangement, upon foreclosure or otherwise, shall be subject to
the "Right of First Refusal" provisions of Sections 2.3 and 2.4 hereof.
(d) TRANSFER OF WARRANT. Notwithstanding the provisions of Section 2.1,
L.H. Friend, Weinress, Xxxxxxxx & Xxxxxxx, Inc. (the "Firm") shall be permitted
to assign its warrant to purchase 31,250 shares of the Corporation's common
stock to one or more officers and directors of the Firm ("Permitted
Transferees") in the percentages the Firm shall deem fit, provided, however,
that (i) notwithstanding such assignment, the warrant shall be deemed for
purposes of this Agreement to be owned by the Firm, and (ii) each such Permitted
Transferee agrees to be bound by the terms of this Agreement as if a signatory
hereto.
2.3 TRANSFERS TO THIRD PARTIES.
(a) NOTICE OF RIGHT OF FIRST REFUSAL. Notwithstanding the provisions of
Section 2.1, and absent the right to make a transfer of Stock pursuant to
Section 2.2, each Shareholder may transfer all or a portion of his or her Stock,
subject in all respects to the following "right of first refusal" provisions of
this Section 2.3. If any Shareholder (the "Selling Shareholder") desires to sell
Stock on the market in a "broker's transaction" or to a party unrelated to the
Selling Shareholder, the Selling Shareholder shall, not less than five (5)
business days prior to the date of the proposed sale, assignment, transfer or
other disposition, deliver a Notice of Right of First Refusal to (x) the
"Shareholders Representatives" (which shall mean Xxxxxxxxxxx X. Xxxx and/or Xxx
Xxxxxxxxxx, acting in such capacity, and/or their assigns, as applicable), and
(y) each of the Purchasers, containing the following information:
(i) the number of shares of Stock proposed to be so transferred (the
"Offered Stock");
(ii) the terms and conditions of the proposed transfer, including the
identity of the proposed transferee(s), if not a "market transaction" and the
cash consideration to be received therefor (the "Offered Terms"); and
(iii) an affirmative offer made by the Selling Shareholder to transfer
the Offered Stock to the Shareholders Representatives and the Purchasers at a
price (the "Offer Price") equal to the total cash price in the proposed transfer
for the Offered Stock as indicated in the Notice of Right of First Refusal
(I.E., the number of shares multiplied by the per share-cash price, to be
received for the shares of Stock to be transferred), it being agreed that, (x)
without the prior written approval of each of the Purchasers, all transfers
permitted by this Section 2.3 must be solely for consideration consisting of
cash, and (y) the Offer Price for all broker's transactions shall be the
weighted average sales price for the Common Stock on the date of delivery of the
Notice of Right of First Refusal.
The date that the Notice of Right of First Refusal is delivered to the
Shareholders Representatives and the Purchasers shall constitute the First
Refusal Notice Date.
(b) PRIMARY RIGHT OF FIRST REFUSAL BY THE SHAREHOLDERS REPRESENTATIVES.
Each of the Shareholders Representatives shall have the sole and exclusive
option to acquire all or any specified portion of the shares of Stock offered
for transfer in accordance with the provisions of the Notice of Right of First
Refusal for a period of two (2) business days from the First Refusal Notice Date
(the "Shareholder Exclusive Option Period"). The Shareholders Representatives
may exercise such option by giving written notice of exercise to the Selling
Shareholder and the Purchasers prior to the termination of the Shareholder
Exclusive Option Period. Such notice of exercise shall refer to the Notice of
Right of First Refusal and shall set forth the number of shares to be acquired
by the Shareholders Representatives. The Shareholders Representative may assign
their purchase rights under this Section 2.3 to any of the other Shareholders or
to any other then current executive officer or director of
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the Company who agrees in writing (in form reasonably acceptable to Purchasers)
to be subject to and bound by the terms of this Agreement.
(c) SECONDARY RIGHT OF FIRST REFUSAL BY THE PURCHASERS. In the event
the Shareholders Representatives do not collectively elect to acquire all of the
Offered Stock, the Purchasers shall have an exclusive option for three (3)
business days after the expiration of the Shareholder Exclusive Option Period to
acquire all or any portion of the Offered Stock not acquired by the Shareholders
Representatives. The Purchasers may, by agreement, allocate between themselves
the right to acquire such part of the Offered Stock that will not be acquired by
the Shareholders Representatives.
In the absence of such an agreement, each Purchaser will be entitled to
give written notice to the Selling Shareholder (the "Purchase Notice"), within
such three business day period, of such Purchaser's election to acquire all or
any part of such Offered Stock that is not being acquired by the Other
Shareholders ("Excess Offered Stock"). If the Purchasers' offers to purchase
exceed the amount of Excess Offered Stock, the option to acquire such Stock
shall be allocated between the Purchasers as follows:
(i) Each Purchaser shall be absolutely entitled to acquire the
number of shares of Excess Offered Stock that is equal to or less than
its proportionate part of such Excess Offered Stock, based upon the
number of shares owned by each Purchaser;
(ii) Each Purchaser electing to acquire more than its
proportionate part of the Excess Offered Stock under the previous
allocation step may acquire the remainder of the Excess Offered Stock
which is not previously allocated to the other Purchaser (I.E., because
the other Purchaser did not elect to acquire its entire ratable portion
under the preceding allocation step);
(d) REQUIREMENT TO PURCHASE ALL OFFERED STOCK. Notwithstanding the
provisions of the Section 2.3(b), the option to purchase shares of Stock
described in a Notice of Right of First Refusal that describes a proposed
non-market transaction may be exercised and the Closing (as hereinafter defined)
consummated only if the Shareholders Representatives and the Purchasers
collectively agree to purchase all of the shares of the Offered Stock.
(e) CLOSING AND TENDER REQUIREMENTS. The consummation of any transfer
required pursuant to an exercise of option rights created by this ARTICLE TWO
shall constitute the "Closing", and the time and date of such Closing shall
constitute the "Closing Date." The Closing shall be held at the principal office
of the Corporation, at 10:00 a.m. on or before the 25th day subsequent to the
delivery of the final Purchase Notice, and if the Closing Date falls on a
Saturday, Sunday or legal holiday, the Closing Date shall be postponed to the
next succeeding regular business day following such Saturday, Sunday or legal
holiday. At the Closing, the Selling Shareholder shall present to the acquiring
Shareholders and/or Purchaser(s), or cause the Transfer Agent to, or the
Corporation, as the case may be, all share certificates for Stock required to be
sold in proper form for transfer. Such Stock shall be transferred free of all
liens and encumbrances or adverse claims of any kind or character created by the
Selling Shareholder. At the Closing, the acquiring Shareholders and/or
Purchaser(s), upon receipt of proper tender of the Stock, shall tender full
payment of the Offer Price in conformity with the Offered Terms as set forth in
the Notice of Right of First Refusal.
(f) PERMITTED TRANSFER FOLLOWING RIGHT OF FIRST REFUSAL. If all of the
Stock identified in the Notice of Right of First Refusal is not elected to be
purchased in the five business day time period specified above or, if so
elected, is not purchased as required on or prior to the 25th day subsequent to
the delivery of the final Purchase Notice (it being agreed that the Purchasers
shall be entitled to purchase all of the remaining Offered Shares to be acquired
by the Shareholders Representatives if and to the extent that Purchasers are not
provided, at least three business days prior to the Closing Date, with
reasonable evidence that the Shareholders Representatives have deposited in
escrow the full cash purchase price the Common Stock to be acquired by them or
otherwise established a reasonably
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acceptable guarantee of payment therefor), then all of such Stock (including any
Stock for which a proper tender was made) may be transferred by the Selling
Shareholder at any time during the ensuing 30 days (10 days in the case of a
market transaction) at any price (in the case of a market transaction) or, in
the case of a non-market transaction, in strict conformity with the Offered
Terms (or on terms more favorable to the Selling Shareholder) set forth in the
Notice of Right of First Refusal (it being agreed that the identity of any
purchaser in a non-market transaction may not be changed without submission of a
new Notice of Right of First Refusal). Nothing herein shall limit the rights of
any Selling Shareholder, the Shareholders Representatives or either Purchaser
relating to any breach by any other party hereto.
2.4 TRANSFERS INCLUDE FORECLOSURE. For purposes of this ARTICLE TWO,
a transfer of Stock by a Shareholder shall be deemed to include, but shall not
be limited to, any transfer of legal or beneficial ownership by reason of
foreclosure under any pledge, hypothecation or similar credit transactions (in
which case the 25 day closing period contemplated by Section 2.3(e) shall be
reduced to ten (10) business days).
2.5 COMPLIANCE. Absent the right to make a transfer of Stock pursuant
to Section 2.2 or 2.3 hereof, any transfer described in this ARTICLE TWO of a
Shareholder's Stock without complying with the giving of a Notice of Right of
First Refusal shall be void, and the Corporation shall have the right to issue a
Notice of Right of First Refusal upon discovery of such transfer, a copy of
which shall be sent to the person making such transfer and his or her
transferee. Upon the giving of the Notice of Right of First Refusal, the time
periods for the exercise of the options specified in Section 2.3 shall commence
running.
ARTICLE THREE
RESTRICTIONS IMPOSED UPON THE
TRANSFER OF STOCK BY FACILITY AND PMI
3.1 GENERAL PROHIBITION ON TRANSFERS. Except as is specifically
permitted by the provisions of this ARTICLE THREE, the sale, assignment, pledge,
gift, transfer or other disposition of any of the Purchased Shares, either
directly or indirectly, to any person or entity, is prohibited.
3.2 PERMITTED TRANSFERS. The following transfers of the Purchased
Shares shall be permitted transfers which do not require the giving of a Notice
of Right of First Refusal under Section 3.3 of this ARTICLE THREE.
(a) TRANSFERS WITH CONSENT. Notwithstanding the provisions of Section
3.1, a transfer or disposition of any kind or character otherwise prohibited by
this ARTICLE THREE may be permitted if approved by the Shareholders
Representatives.
(b) TRANSFERS TO AFFILIATES. Notwithstanding the provisions of Section
3.1, each of the Purchasers shall be permitted to transfer (whether by purchase,
assignment, gift, bequest, devise, levy, execution or other means of transfer)
all or any portion of the Purchased Shares to its affiliate (as defined within
the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") provided that each and every such affiliate
executes a written acknowledgment that (i) all Purchased Shares held by such
affiliate will, notwithstanding the transfer to such, be deemed for all purposes
of this Agreement to be owned by the transferring Purchaser, and (ii) that such
affiliate agrees in writing to be bound by all of the terms of this Agreement.
3.3 TRANSFERS TO THIRD PARTIES.
(a) NOTICE OF RIGHT OF FIRST REFUSAL. Notwithstanding the provisions of
Section 3.1, and absent the right to make a transfer of the Purchased Shares
pursuant to Section 3.2, either of the Purchasers may also transfer all or a
portion of the Purchased Shares, subject in all respects to the following "right
of first refusal" provisions of this Section 3.3. If either of the Purchasers
(the "Selling
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Purchaser") desires to sell Purchased Shares on the market or to a party
unrelated to such Purchaser in a "non-market" sale, the Selling Purchaser shall
not less than five (5) business days prior to the date of the proposed sale,
assignment, transfer or other disposition, deliver to the Other Purchaser and
the Corporation a "Purchaser Notice of Right of First Refusal" containing the
following information:
(i) the number of shares of Purchased Shares proposed to be so
transferred (the "Purchaser Offered Stock");
(ii) the terms and conditions of the proposed transfer, including the
identity of the proposed transferee(s) and the per share price to be charged (if
any) for the Purchased Shares to be transferred and the cash consideration to be
received therefor (the "Purchaser Offered Terms"); and
(iii) an affirmative offer made by the Selling Purchaser to transfer
the Offered Stock to the Other Purchaser and, after the Exclusive Option Period
(as hereinafter defined), to the Corporation at a price (the "Purchaser Offer
Price") equal to the total cash price in the proposed transfer for the Purchaser
Offered Stock as indicated in the Purchaser Notice of Right of First Refusal
(I.E., the number of shares multiplied by the per share price, if any, to be
charged for the shares of Stock to be transferred), it being agreed that, (x)
without the prior written approval of the Other Purchaser all transfers
permitted by this Section 3.3 must be solely for consideration consisting of
cash or cash equivalents, and (y) the Purchase Offer Price for all broker's
transactions shall be the weighted average sales price for the Common Stock on
the date of delivery of the Purchaser Notice of Right of First Refusal.
The date that the Purchaser Notice of Right of First Refusal is
delivered to the Purchasers Representatives and the Corporation shall constitute
the Purchaser First Refusal Notice Date.
(b) PRIMARY RIGHT OF FIRST REFUSAL BY THE PURCHASERS REPRESENTATIVES.
The Other Purchaser shall have the sole and exclusive option to acquire all or
any portion of the Purchased Shares offered by the Selling Shareholder for
transfer in accordance with the provisions of the Purchaser Notice of Right of
First Refusal for a period of five (5) business days from the Purchaser First
Refusal Notice Date (the "Purchaser Exclusive Option Period"). The Other
Purchaser may exercise such option by giving written notice of exercise to the
Selling Purchaser prior to the termination of its Exclusive Option Period. Such
notice of exercise shall refer to the Purchaser Notice of Right of First Refusal
and shall set forth the number of Purchased Shares to be acquired by the Other
Purchaser.
(c) SECONDARY RIGHT OF FIRST REFUSAL BY THE CORPORATION. The
Corporation shall have an exclusive option for two (2) business days after the
expiration of the Purchaser Exclusive Option Period to acquire all of the
Offered Stock that will not be acquired by the Other Purchaser. The Corporation
may assign its purchase rights under this Section 3.3 to any or all of the
Shareholders or to any other current executive officer or director of the
Company who agrees in writing (in form reasonably acceptable to Purchasers) to
be subject to and bound by the terms of this Agreement).
(d) REQUIREMENT TO PURCHASE ALL OFFERED STOCK. Notwithstanding the
provisions of the Section 3.3(b), the option to purchase the Purchased Shares
described in a Purchaser Notice of Right of First Refusal that describes a
proposed non-market transaction may be exercised and the Purchaser Closing (as
hereinafter defined) consummated only if the Corporation and/or the Other
Purchaser collectively agree to purchase all of the shares of the Purchaser
Offered Stock.
(e) CLOSING AND TENDER REQUIREMENTS. The consummation of any transfer
required pursuant to an exercise of option rights created by this ARTICLE THREE
shall constitute the "Purchaser Closing", and the time and date of such Closing
shall constitute the "Purchaser Closing Date." The Purchase Closing shall be
held at the principal office of the Corporation, at 10:00 a.m. on or before the
25th day subsequent to the expiration of the Purchaser Exclusive Option Period
and if the Closing Date falls on a Saturday, Sunday or legal holiday, the
Purchase Closing Date shall be postponed to the next succeeding regular business
day following such Saturday, Sunday or legal holiday. At the Purchaser
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Closing, the Selling Purchaser shall present to the Corporation and/or the Other
Purchaser, as the case may be, all share certificates for the Purchased Shares
required to be sold in proper form for transfer. Such Purchased Shares shall be
transferred free of all liens and encumbrances or adverse claims of any kind or
character. At the Purchaser Closing, the Corporation and/or the Other Purchaser,
as the case may be, upon receipt of proper tender of the Purchased Shares, shall
tender full payment of the Purchaser Offer Price in conformity with the
Purchaser Offered Terms as set forth in the Purchaser Notice of Right of First
Refusal.
(f) PERMITTED TRANSFER FOLLOWING RIGHT OF FIRST REFUSAL. If all of the
Purchased Shares identified in the Purchaser Notice of Right of First Refusal
are not purchased by the Corporation and/or the Other Purchaser prior to the
25th day subsequent to the expiration of the Purchaser Exclusive Option Period,
then all of such Purchased Shares (including any shares for which a proper
tender was made) may be transferred by the Selling Purchaser at any time during
the ensuing 30 days (10 days in the case of a market transaction) at any price
(in the case of a market transaction) or, in the case of a non-market
transaction, in strict conformity with the Purchaser Offered Terms (or on terms
more favorable to the Selling Purchaser) set forth in the Purchaser Notice of
Right of First Refusal.
ARTICLE FOUR
THE GIVING OF NOTICES REQUIRED BY THIS AGREEMENT
4.1 ADDRESSES. Any notices, requests, demands and other communications
required or permitted to be given hereunder must be in writing and, except as
otherwise specified in writing, will be deemed to have been duly given when
personally delivered, telexed or facsimile transmitted, or three days after
deposit in the United States mail, by certified mail, postage prepaid, return
receipt requested, as follows. The addresses of the Corporation, Facility, PMI
and the Shareholders, which shall be considered to be their last known addresses
unless subsequently changed in accordance with the provisions of this Agreement,
are as follows:
IF TO THE CORPORATION: Grand Prix Association of Long Beach, Inc.
0000 Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
IF TO FACILITY: Midwest Facility Investments, Inc.
0000 Xxxx Xxxxxxxxxxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
Attention: H. Xxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
IF TO PMI: Penske Motorsports, Inc.
0000 X. Xxx Xxxxxx Xxxx, Xxxxx 000
Xxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Xx.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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IF TO ANY SHAREHOLDER: at the address reflected opposite
the Shareholder's name on
Schedule 1 hereto
IF TO EITHER SHAREHOLDER
REPRESENTATIVE: Xxxxxxxxxxx X. Xxxx or Xxx Xxxxxxxxxx
Grand Prix Association of Long Beach, Inc
0000 Xxxxxxx Xxxxxx
Xxxx Xxxxx, XX 00000
Attention: Xxxxxxxxxxx X. Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Any party may change its address for the purposes of this Agreement by giving
notice of such change of address to the other parties in the manner herein
provided for giving notice.
4.2 FORM OF NOTICE. Any notice or communication hereunder must be in
writing, and may be personally delivered or given by registered or certified
mail, return receipt requested, and if given by registered or certified mail,
shall be deemed to have been given and received forty-eight hours after deposit
in the United States mail of a registered or certified letter, return receipt
requested, containing such notice, properly addressed, with postage prepaid; and
if given otherwise than by registered or certified mail, it shall be deemed to
have been given when received by the party to whom it is addressed at the time
received.
4.3 FAILURE TO NOTIFY OF CHANGED ADDRESS. It shall be the
responsibility of each of the parties to this Agreement to notify all other
parties of their respective addresses and any changes thereof, and any
objections to the performance of any act required hereunder based upon a failure
to receive a notice mailed in conformity with the provisions of this Agreement
shall be meritless.
ARTICLE FIVE
ELECTION OF DIRECTORS
During the term of this Agreement, each of the Shareholders and
Purchasers agrees to vote all shares of Corporation Common Stock owned by such
party to elect as directors of the Corporation (x) those designees of Facility
and/or PMI that such Purchaser(s) then has (have) the right to designate as
director nominees pursuant to the Stock Purchase Agreements, and (y) such other
nominees for election as are proposed from time to time by the Corporation's
Board of Directors or appropriate nominating committee thereof.
ARTICLE SIX
MISCELLANEOUS
6.1 CUSTODY. In connection with and to facilitate the terms of this
Agreement, the Shareholders, Facility, PMI and the Corporation hereby appoint
L.H. Friend, Weinress, Xxxxxxxx & Xxxxxxx, Inc. as custodian (the "Custodian")
and herewith deposit with the Custodian certificates representing the
Shareholder Shares currently held by the Shareholders listed on Schedule I
hereto, together with certificates representing the Facility Shares and the PMI
Shares. Each such certificate so deposited is in negotiable and proper
deliverable form endorsed in blank with the signature of the Shareholder thereon
guaranteed by a commercial bank or trust company in the United States or by a
member firm of the New York Stock Exchange, or is accompanied by a duly executed
stock power or powers in blank, bearing the signature of the Selling Shareholder
so guaranteed. The Custodian is hereby authorized and directed to hold in
custody the certificate or certificates delivered herewith. The Shareholders,
Facility and PMI understand that the certificates evidencing such party's Common
Stock will bear a restrictive legend prohibiting transfer thereof except in
compliance with (i) applicable state and federal securities laws and may not be
transferred of record except in compliance therewith, and (ii) the
8
terms of this Agreement. The Shareholders and Purchasers agree to promptly make
such deliveries and to execute any additional agreement required to accomplish
the deposit with the Custodian of all certificates evidencing Common Stock now
owned or that may be acquired in the future.
6.2 TERMINATION. This Agreement shall terminate upon the earlier of
(i) six years from the date hereof, (ii) with respect to Facility's rights
hereunder, the date Facility ceases to own at least 80% of the shares of Common
Stock acquired by Facility pursuant to the Facility Stock Purchase Agreement,
and (iii) with respect to PMI's rights hereunder, the date PMI ceases to own at
least 80% of the shares of Common Stock acquired by PMI pursuant to the PMI
Stock Purchase Agreement. This Agreement shall terminate as to any specific
Shareholder upon the date such Shareholder ceases to own any Stock.
6.3 MODIFICATION. This Agreement may only be amended, terminated or
modified by the written consent of the Corporation and the Shareholder or
Shareholders to be bound by such modification.
6.4 SUCCESSORS. This Agreement shall be binding upon the parties
hereto, their heirs, administrators, successors, executors and assigns, and the
parties hereto do covenant and agree that they themselves and their respective
heirs, executors, successors, administrators and assigns will execute any and
all instruments, releases, assignments and consents that may be reasonably
required of them to more fully execute the provisions of this Agreement.
6.5 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall serve as an original for all purposes, but all
copies of which shall constitute but one and the same Agreement.
6.6 HEADINGS. All headings set forth in this Agreement are intended
for convenience only and shall not control or affect the meaning, construction
or effect of this Agreement or of any of the provisions thereof.
6.7 GOVERNING LAW. This Agreement shall be governed by and shall be
construed and enforced in accordance with the laws of the State of Florida.
6.8 WAIVER. The waiver by any party hereto of a breach of any
provision of this Agreement must be in writing and shall not operate or be
construed as a waiver of any subsequent breach by any party.
6.9 ENTIRE AGREEMENT. This Agreement, together with the Stock
Purchase Agreements and "Registration Rights Agreements" executed in connection
therewith, constitute the entire agreement of the parties hereto with respect to
the transactions contemplated hereby, and it is hereby agreed that any prior
oral or written agreements concerning the sale or disposition of Stock shall be
null and void.
6.10 SEVERABILITY. If any provision of this Agreement shall be held
to be illegal or unenforceable, such illegality or unenforceability shall extend
to that provision solely, and the remainder of this Agreement shall be enforced
as if such illegal or unenforceable provision were not incorporated herein.
6.11 SPECIFIC PERFORMANCE. The right to own and vote capital stock
of the Corporation is hereby declared by the parties hereto to be a unique
right, the loss of which is not susceptible to monetary quantification.
Consequently, the parties hereto agree that an action for specific performance
of the purchase and sale obligations created by this Agreement is a proper
remedy for the breach of its provisions. If any party(ies) to this Agreement
institute legal proceedings in connection with this Agreement, the prevailing
party(ies) shall be entitled to recover their reasonable attorneys' fees and
court costs.
9
6.12 BUSINESS DAYS. References to "Business Days" or "Business Day"
shall mean any day in which The Nasdaq Stock Market is open for business.
Whenever the terms of this Agreement call for the performance of a specific act
on a specified date, which date falls on a Saturday, Sunday or legal holiday,
the date for the performance of such act shall be postponed to the next
succeeding regular business day following such Saturday, Sunday or legal
holiday.
6.13 STOCK REFERENCES. References to "Stock" herein shall mean (i)
each Shareholder's Shares and any capital stock of the Corporation purchased or
otherwise acquired, as of the date hereof or subsequent thereto, by any
Shareholder, and the 31,250 Shares issuable upon exercise of the L.H. Friend,
Weinress, Xxxxxxxx & Xxxxxxx, Inc. Warrant, dated as of June 24, 1996 (ii) any
equity securities issued or issuable, as of the date hereof or subsequent
thereto, directly or indirectly with respect to the Stock referred to in clause
(i) above by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization, and (iii) any other shares of any class or series of capital
stock of the Corporation held by a Shareholder.
6.14 FAILURE TO DELIVER STOCK. If a Purchaser or a Shareholder (or
any personal representative or other representative of a Shareholder) who has
become obligated to sell stock of the Corporation hereunder shall fail to
deliver such stock on the terms and in accordance with this Agreement, the
party(ies) having the right to purchase such stock, in addition to all other
remedies they may have, may send to the such obligated party by registered mail,
return receipt requested, the purchase price for such Stock on the terms
provided for in this Agreement. Thereupon, the Corporation, upon written notice
to such obligated Purchaser or Shareholder, shall cause the cancellation on its
books or cause the Transfer Agent to cancel the certificates representing the
stock to be sold; and thereupon, all of the obligated Purchaser's or
Shareholder's rights in and to such Stock shall terminate.
10
IN WITNESS WHEREOF, the parties to this Agreement have hereunto set
their names as of the date first above written.
MIDWEST FACILITY INVESTMENTS, INC.
By: /s/ H. XXX XXXXX
-----------------------------------------
H. Xxx Xxxxx
PENSKE MOTORSPORTS, INC.
By: /s/ XXXXXXX X. XXXXXX
-----------------------------------------
Xxxxxxx X. Xxxxxx
GRAND PRIX ASSOCIATION OF LONG BEACH, INC.
SHAREHOLDERS:
/s/ XXXXXXXXXXX X. XXXX
-----------------------------------------
Xxxxxxxxxxx X. Xxxx
/s/ XXXXX X. XXXXXXXXXX
-----------------------------------------
Xxxxx X. Xxxxxxxxxx
/s/ XXXXXX X. XXXXXX
-----------------------------------------
Xxxxxx X. Xxxxxx
/s/ XXXXXXX X. XXXXX
-----------------------------------------
Xxxxxxx X. Xxxxx
/s/ XXXXXXX XXXXX
-----------------------------------------
Xxxxxxx Xxxxx
/s/ XXXXX X. XXXXXX
-----------------------------------------
Xxxxx X. Xxxxxx
/s/ XXXX XXXXXXX
-----------------------------------------
Xxxx Xxxxxxx
/s/ XXX XXXXXX
-----------------------------------------
Xxx Xxxxxx
/s/ XXXXX XXXXXXXX
-----------------------------------------
Xxxxx Xxxxxxxx, Trustee of the S.R.E.
Industries Pension Plan & Trust and
individually
/s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx Xxxx, Trustee of the Xxxxx X. Xxxx
Living Trust dated 10/24/89 and
individually
/s/ XXXXXX X. XXXXXX
-----------------------------------------
Xxxxxx X. Xxxxxx, Trustee under the Xxxxxx
Family Trust and Individually
/s/ XXXX X. XXXXX, III
-----------------------------------------
Xxxx X. Xxxxx, III
/s/ XXXXXX XXXXXX
-----------------------------------------
Xxxxxx Xxxxxx
11
GRAND PRIX ASSOCIATION OF LONG BEACH, INC.
SHAREHOLDERS:
/s/ XXXXX X. XXXX
-----------------------------------------
Xxxxx X. Xxxx
/s/ XXX XXXXXX
-----------------------------------------
Xxx Xxxxxx
/s/ XXX XXXXXX
-----------------------------------------
Xxx Xxxxxx Trustee
under the Xxxxxx Family Trust
/s/ XXXXXXX X. XXXXX
-----------------------------------------
Xxxxxxx X. Xxxxx, Trustee of the
Xxxxxxx-Xxxxx Trust dated 12-6-91
/s/ XXXX XXX XXXXXXX FRIES
-----------------------------------------
Xxxx Xxx Xxxxxxx Fries, Trustee of
the Xxxxxxx-Xxxxx Trust dated 12-5-91
/s/ XXXXXX XXXXXX
-----------------------------------------
Xxxxxx Xxxxxx
/s/ XXXXX XXXXX
-----------------------------------------
Xxxxx Xxxxx
/s/ XXXXXXXX XXXXXXX
-----------------------------------------
Xxxxxxxx Xxxxxxx
/s/ XXXXXX XXXXX
-----------------------------------------
Xxxxxx Xxxxx, Trustee of the Ainge
Family Trust dated 11-21-96
and individually
MATLINS FINANCIAL CONSULTING, INCN.
PROFIT SHARING PLAN
/s/ XXXX XXXXXXX
-----------------------------------------
Xxxx Xxxxxxx, Trustee
THE LINCOLN FUND, LP
/s/ XXXX XXXXXXX
-----------------------------------------
12
THE LINCOLN FUND TAX
ADVANTAGED, LP
/s/ XXXX XXXXXXX
-----------------------------------------
THE XXXXXX FUND, LP
/s/ XXXX XXXXXXX
-----------------------------------------
/s/ J. XXXXXX XXXXX
-----------------------------------------
J. Xxxxxx Xxxxx Trustee
of the Xxxxxx Xxxxx Trust dated 12-15-93
/s/ XXXX XXX XXXXX
-----------------------------------------
Xxxx Xxx Xxxxx Trustee
of the Xxxxxx Xxxxx Trust dated 12-15-93
/s/ XXXXX XXXXXXXX
-----------------------------------------
Xxxxx Xxxxxxxx
/s/ XXXXX XXXXXXXX
-----------------------------------------
Xxxxx Xxxxxxxx Trustee of the S.R.E.
Industries Pension Plan & Trust
/s/ XXXXXXXXX XXXXX
-----------------------------------------
Xxxxxxxxx Xxxxx, Trustee of the Ainge
Family Trust dated 11-21-96
/s/ XXXXXX XXXXXX
-----------------------------------------
Xxxxxx Xxxxxx
13
/s/ XXXXX XXXXXXX
-----------------------------------------
Xxxxx Xxxxxxx, Trustee of the Xxxxxxx
Family Trust dated 11-13-95
/s/ XXXXXXX XXXXXXX
-----------------------------------------
Xxxxxxx Xxxxxxx, Trustee of the Xxxxxxx
Family Trust dated 11-13-95
EDMARJON-RONBREWDAVE, LLC*
A Tennessee limited liability company
/s/ XX X. XXXXXX
-----------------------------------------
Xx X. Xxxxxx, CEO
L.H. FRIEND, WEINRESS, FRANKSON,
PRESSON, INC.
By:/S/ XXXXXXX X. XXXXXXX
-------------------------------------
Xxxxxxx X. Xxxxxxx
President
-------------------------------------
/s/ XXXX XXXXX
-----------------------------------------
Xxxx Xxxxx
/s/ XXXX X. XXXXX, XX.
-----------------------------------------
Xxxx X. Xxxxx, Xx.
/s/ XXXXXX XXXXX
-----------------------------------------
Xxxxxx Xxxxx
* Only 45,000 shares of EDMARJON-RONBREWDAVE, LLC is subject to the Right of
First Refusal Agreement.
14
/s/ XXXXXXXX XXXXX
---------------------------------
Xxxxxxxx Xxxxx
SCHEDULE I TO RIGHT OF FIRST REFUSAL AGREEMENT
NAME SHARES 1993 OPTIONS
---- ------ ------------
Xxxxxxxxxxx X. Xxxx 310,207(8) 174,435
Xxxxxxxxxxx X. Xxxx 72,341(9)
Xxxxx X. Xxxx 65,804
Xxxxx X. Xxxxxxxxxx 176,499(12) 108,702
Xxxxxx Xxxxxx
and Xxxxxx Xxxxxx 55,204(6) 20,830
Xxxxxxx X. Xxxxx 32,190(5) 12,691
Xxxx Xxxxx 31,728
Xxxxx Xxxxxx 9,064
Xxxxx Xxxxxx
and Xxxxxx Xxxxxx 23,049(7)
Xxxx Xxxxxxx
and Xxxxxxxx Xxxxxxx 1,400
Xxx Xxxxxx 500
Xxxxx Xxxxxxxx 7,114 14,939
Xxxxx Xxxxxxxx 7,114
Xxxxx Xxxxxxxx and
Xxxxx Xxxxxxxx Trustees
under the S.R.E. Industries
Penion Plan & Trust 41,799
Xxxxx Xxxx 11,952
Xxxxx Xxxx Trustee of
the Xxxxx X. Xxxx Living
Trust dated 10/24/89 49,014
Xxxxxx X. Xxxxxx 11,952
Xxxxxx X. Xxxxxx and
Xxx Xxxxxx Trustees of
the Xxxxxx Family Trust 70,841(1)
Xxx Xxxxxx 2,987
Xxxx Xxxxx, III 36,570(3)
Xxxxxx Xxxxxx 59,195(2) 14,939
Xxxxxx Xxxxx 14,939
Xxxxxx Xxxxx and
Xxxxxxxxx Xxxxx, Trustees
of the Ainge Family Trust
dated 11/21/96 46,027
NAME
----
Xxxxxxx X. Xxxxx and
Xxxx Xxx Xxxxxxx Fries,
Trustees of The Xxxxxxx-Xxxxx
Trust dated 12-5-91 35,000(4)
The Lincoln Fund, LP 66,600
The Lincoln Fund Tax
Advantaged, LP 18,750
The Xxxxxx Fund, LP 15,625
Matlins Financial Consulting,
Inc. Profit Sharing Plan 6,250
Xxx Xxxxx and Xxxxx Xxxxx 37,508(11)
J. Xxxxxx Xxxxx and
Xxxx Xxx Xxxxx Trustees
of the Xxxxxx Xxxxx Trust
dated 12/15/93 23,120
Xxxxx Xxxxxxx and
Xxxxxxx Xxxxxxx Trustees
of the Xxxxxxx Family Trust
dated 11/13/95 35,570
Xxxx Xxxxx 38,557 11,952
Xxxx X. Xxxxx, Xx. and
Xxxxxxxx Xxxxx 81,910(1) 11,952
Xxxxxx Xxxxx 14,228
EDMARJON-RONBREWDAVE, LLC
A Tennessee limited liability
company (successor in interest
to Memphis International
Motorsports Corporation) 45,000(1)
L.H. Friend, Weinress,
Xxxxxxxx & Xxxxxxx, Inc. Warrant to purchase 31,250
(1) 16,148 pledged to secure $12,485 note to GPALB.
(2) 18,148 subject to $44,500.42 margin balance with Evern Securities.
(3) Shares in a Mortgage Pledge Account at Xxxxxxx Xxxxx will be released
within 10 days.
(4) Subject to $105,677 margin balance account with Xxxxxxxxxxx Xxxx & Co.
(5) Pledged to secure $24,887.50 note to GPALB.
(6) Pledged to secure $42,679 note to GPALB.
(7) Pledged to secure $17,820 note to GPALB.
(8) Subject to $342,731 margin balance with Bear Xxxxxxx.
(9) Shares and options owned by Xxx Mierabile subject to right of first
refusal agreement with dated 8-8-97 in favor of Xxxxxxxxxxx X. Xxxx
(10,457 of Xx. Xxxxxxxx'x shares are pledged to secure $8,085 note to
GPALB.)
(10) intentionally ommitted.
(11) 10,457 pledged to secure $8,085 note to GPALB.
(12) 114,997 pledged to secure $88,907.50 note to GPALB.
(13) Part of total 250,000 series B convertible preferred shares which are
held by First Commercial Bank of Memphis to secure a $1,500,000 note.
