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EXHIBIT 10.17
RIGHT OF FIRST REFUSAL AGREEMENT
THIS RIGHT OF FIRST REFUSAL AGREEMENT (the "Agreement"), dated as of
August 14, 1996, by and among AGN Venturer L.L.C., a Delaware limited liability
company ("Venturer"), Multimedia Games, Inc., a Texas corporation ("MMG") and
the membership unit holders of Venturer which are signatory hereto (each a
"Member" and collectively, the "Members").
W I T N E S S E T H:
WHEREAS, pursuant to a certain Unit Purchase Agreement dated August 14,
1996, it is a condition precedent to the obligation of TV Games, Inc., a wholly
owned Delaware subsidiary of MMG, to sell its membership units in Venturer
(individually a "Unit" and collectively the "Units") that Venturer and MMG have
entered into this Agreement; and
WHEREAS, the parties wish to provide for certain "right of first
refusal" rights with respect to the Units of Venturer.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
Certain Definitions
1.1 Definitions. For the purposes of this Agreement the following terms
have the following meanings:
"Affiliate", with respect to any Person, means any other Person
directly or indirectly controlling, controlled by or under common
control with, such Person. For purposes of this definition, "control"
(including with correlative meanings, the terms "controlling",
"controlled by" or "under common control with"), as used with respect to
any Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by
contract or otherwise.
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"Business Day" shall mean any day other than a Saturday, Sunday,
Federal holiday or a day on which the banks in New York are required or
permitted by law to be closed.
"Debt" shall mean evidence of an installment purchase obligation
given or tendered by a Third Party (or by MMG) as consideration for all
or a portion of the Offered Units.
"Effective Date" shall mean the day and year first above written.
"Lien" shall mean any mortgage, pledge, security interest, lien,
charge, encumbrance, equity, claim, option, tenancy, right or
restriction on transfer of any nature whatsoever.
"Person" means an individual, a partnership, a joint venture, a
corporation, an association, a trust, an individual retirement account
or any other entity or organization, including a government or any
department or agency thereof.
"Permitted Encumbrance" means any lien, security interest, pledge
or similar claim given or granted by a Member to a bank or recognized
financial institution.
"Permitted Transfer" means (a) a Sale of Units between any Member
who is a natural person and such Member's spouse or children, or a trust
for the benefit of such Member, or such Member's spouse or children,
provided that with respect to any Sale to such a trust, the Member
retains, as trustee or by some other means, the sole authority to vote
such Units; (b) a Sale of Units between any Member who is a natural
person and such Member's guardian or conservator and, upon the death of
such Member, such Member's executor, administrator and heirs; (c) a Sale
of Units between any Member and an Affiliate of such Member; or (d) a
Permitted Encumbrance. No Permitted Transfer
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shall be effective unless and until the transferee of the Units so
transferred executes and delivers to MMG an executed counterpart of this
Agreement and agrees to be bound hereunder in the same manner and to the
same extent as the Member from whom the Units were transferred. From
and after the date on which a Permitted Transfer becomes effective, the
Permitted Transferee of the Units so transferred shall have the same
rights, and shall be bound by the same obligations, under this Agreement
as the transferor of such Units.
"Permitted Transferee" means any person or entity who shall have
acquired and who shall hold Units pursuant to a Permitted Transfer.
"Public Offering" means an underwritten public offering of equity
securities of Venturer pursuant to an effective registration statement
under the 1933 Act.
"Sale" means any sale, assignment, transfer, distribution
(whether by a partnership to any of its partners or otherwise) or other
disposition of Units or of a participation therein, whether or not for
value.
"Third Party" means any Person other than the Prospective Seller
(as defined herein) or MMG.
ARTICLE II
Restrictions on Transfer
2.1. Restrictions on Transfer. Each Member agrees that it will not,
directly or indirect, make any Sale or create or incur or assume any Lien with
respect to any Units held by such Member other than (a) any Sale to a Permitted
Transferee or (b) any Sale solely for cash and/or Debt that is made in
compliance with the procedures, and subject to the limitations set forth in
Article III herein.
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ARTICLE III
Right of First Refusal
3.1 Priority of Right of Refusal. The parties hereto agree that the
right of first refusal granted pursuant to this Agreement is the first right of
refusal for the sale of any Units and that this Agreement has priority over any
right of refusal found in the limited liability company agreement of Venturer
or in any other agreement to which Venturer or the Members are a party.
3.2 Right of First Refusal. (a) If any Member receives from or
otherwise negotiates with a Third Party a bona fide offer to purchase for cash
and/or Debt (an "Offer") any of the Units owned or held by such Member, and
such Member intends to pursue a Sale of such Units to such Third Party, such
Member (the "Prospective Seller") shall provide MMG written notice of such
Offer (an "Offer Notice"). The Offer Notice shall identify the Third Party
making the Offer, the number of Units with respect to which the Prospective
Seller has such an Offer (the "Offered Units"), the price per Unit, delineating
the amount of cash and/or Debt, at which a sale is proposed to be made (the
"Offer Price"), and all the other material terms and conditions of the Offer.
(b) The receipt of an Offer Notice by MMG from a Prospective Seller
shall constitute an offer by such Prospective Seller to sell to MMG the Offered
Units at the Offer Price for an equivalent amount in cash and/or Debt and
otherwise on terms and conditions no less favorable to the Prospective Seller
than as described in the Offer Notice. Such offer shall be irrevocable for 10
days after receipt of such Offer Notice by MMG (the "Acceptance Period").
During the Acceptance Period, MMG shall have the right to accept such offer as
to all of the Offered Units by giving a written notice of acceptance (the
"Notice of Acceptance") to the Prospective Seller prior to the expiration of
the Acceptance Period.
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(c) If MMG so accepts the Prospective Seller's offer, MMG will purchase
for cash and/or Debt from the Prospective Seller, and the Prospective Seller
will sell to MMG, the Offered Units. The price per Unit to be paid by MMG
shall be the Offer Price specified in the Offer Notice.
(d) The consummation of any such purchase by and sale to MMG shall take
place on such date, not later than 10 days after the Acceptance Period, as MMG
and the Prospective Seller shall select. Upon the consummation of such
purchase and sale, the Prospective Seller shall (i) deliver to MMG
certificates, if any, evidencing the Offered Units purchased and sold duly
endorsed in blank or accompanied by written instruments of transfer in form
reasonably satisfactory to MMG duly executed by the Prospective Seller and (ii)
assign all its rights under this Agreement with respect to the Offered Units
purchased and sold pursuant to an instrument of assignment reasonably
satisfactory to MMG.
(e) In the event that (i) the Prospective Seller shall not have
received the Notice of Acceptance for the Offered Units upon the expiration of
the Acceptance Period or (ii) MMG shall have given a Notice of Acceptance to
the Prospective Seller but shall have failed to consummate, other than as a
result solely of the fault of the Prospective Seller, a purchase of the Offered
Units with respect to which such Notice of Acceptance was given within the
Acceptance Period, such Prospective Seller shall have the right to reject any
or all Notices of Acceptance theretofore received from MMG, and nothing in this
Section 3.2 shall limit the right of the Prospective Seller to make a sale of
the Offered Units so long as all the Offered Units that are sold or otherwise
disposed of by the Prospective Seller (which number of Offered Units shall be
not less than the number of Offered Units specified in such Offer Notice) are
sold for cash and/or Debt (A) within 60 days after the date of receipt of such
Offer Notice by MMG, (B) at an amount not less than the Offer Price included in
such Offer Notice and (C) to the Third Party making the Offer on the material
economic terms set forth in the Offer.
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(f) In the event that the Prospective Seller shall not have sold the
Offered Units before the expiration of the 60-day period in accordance with
paragraph (e) above, then the provisions of this Section 3.2 shall be
reinstated as to the Offered Units as if an Offer Notice had not been
delivered.
(g) Offered Units sold in accordance with all the terms and
conditions of this Agreement shall continue to be subject to this Agreement and
MMG's right of first refusal, and, upon MMG's request, the Third Party who
purchases such Offered Units shall execute an acknowledgment to such effect.
(h) Anything in this Section 3.2 to the contrary notwithstanding, the
provisions of this Section 3.2 will not be applicable to sales of Units
pursuant to a Public Offering.
ARTICLE IV
Miscellaneous
4.1 Termination. This Agreement shall terminate on the earlier of (a)
the tenth anniversary of the execution and delivery hereof or (b) by mutual
written consent of all parties to the Agreement.
4.2 Representations. Each of the parties hereto represents that this
Agreement has been duly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms.
4.3 Certain Remedies. Without intending to limit the remedies
available to any of the parties hereto, each of the parties hereto agrees that
damages at law will be an insufficient remedy in the event such party violates
the terms hereof and each of the parties hereto further agrees that each of the
other parties hereto may apply for and have injunctive or other equitable
relief in any court of
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competent jurisdiction to restrain the breach or threatened breach of, or
otherwise specifically to enforce, any of such party's agreements set forth
herein.
4.4 Amendments and Waivers. Any term of this Agreement may be amended
and the observance of any such term may be waived (either generally or in a
particular instance and either retroactively or prospectively) only with the
written consent of all parties to the Agreement.
4.5 Notices. All notices and other communications provided for herein
shall be in writing and shall be delivered by telecopy, sent by reputable
overnight courier, by hand or sent by certified or registered mail, return
receipt requested, postage prepaid, addressed, if to any Member, to such Member
at its address set forth below its signature to this Agreement (or to such
other address as such Member shall have specified in writing to the party
giving any such notice or sending any such communication). All such notices
shall be conclusively deemed to be received and shall be effective, (i) if sent
by hand delivery, upon receipt, (ii) if sent by telecopy ,upon dispatch
thereof, answerback received or (iii) if sent by registered or certified mail,
on the third day after the day on which such notice is mailed or(iv) if sent by
overnight courier on the Next Business Day after the day on which such notice
was sent.
4.6 Benefit; Successors and Assigns. Except as otherwise provided
herein, this Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted assigns. This
Agreement may not be assigned without the prior written consent of the
nonassigning parties. Nothing in this Agreement either express or implied is
intended to confer on any person other than the parties hereto and their
respective successors and permitted assigns, any rights, remedies or
obligations under or by reason of this Agreement.
4.7 Miscellaneous. This Agreement sets forth the entire agreement and
understanding among the parties hereto, and supersedes
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all prior agreements and understandings, relating to the subject matter hereof.
All representations and warranties contained herein shall survive the execution
and delivery of this Agreement, regardless of any investigation made by any
party hereto or on such party's behalf. This Agreement shall be construed and
enforced in accordance with and governed by the law of the State of Delaware
without giving effect to principals of conflicts of laws. The headings in this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized signatories thereunto duly
authorized as of the day and year first above written.
MULTIMEDIA GAMES, INC.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
0000 Xxxxx Xxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx
Attn: Xxxxxx Xxxxxx
Fax: (000) 000-0000
AGN VENTURER L.L.C.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
0000 Xxxxx Xxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx
Attn: Xxxxxx Xxxxxx
Fax: (000) 000-0000
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"BUYERS"
OK Associates Pension Trust
By:
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Name:
---------------------------------
Title:
--------------------------------
Address:
000 Xxxxxxxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
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Name: Xxxxx Xxxxxx
Address:
G-V Capital Corp.
000 Xxxxxxxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
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Name: Xxxxxxx Xxxxxx
Address:
Gro-Vest Management, Inc.
000 Xxxxxxxxxx Xxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxx, Xxx Xxxx, 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
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Name: Xxxxxxx Xxxxxx
Address:
000 Xxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
---------------------------------------
Name: Xxxxxx Xxxxxx
Address:
Multimedia Games, Inc.
0000 Xxxxx Xxxxx
Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
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Alliance Capital Investment
Corp.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
0 Xxx Xxxxxx
Xxxxx Xxxxxx, XX 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
Attention: Xxx Xxxxxx
The Holding Company
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
0 Xxxxx XxXxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Fax: (000) 000-0000
Phone: (000) 000-0000
Attention: Xxxxxx X. Xxxxxx
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Xxxxxxx Xxxxxxx Xxxx.
By:
-----------------------------------
Name:
----------------------------------
Title:
--------------------------------
Address:
00 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
(000) 000-0000
Baystate Development Trust
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Address:
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
(000) 000-0000
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