1
EXHIBIT 10.6
PROCEEDS AGREEMENT
The undersigned parties to the Merger Agreement and Plan of
Reorganization dated as of May 17, 2000 (the "Merger Agreement") hereby agree
as follows (any capitalized terms not defined herein having the meanings given
them in the Merger Agreement):
1. Guaranty. Until May 17, 2004 (the "Payoff Date"), Buyer guaranties
to Sellers the receipt of not less than an average price of $5.00 per Share
upon the sale or other disposition in an arm's length transaction of the Stock
Consideration (subject to appropriate adjustment in the event of any stock
split, reverse stock split, dividend of Shares or reclassification of the
Shares). The foregoing guaranty shall also apply to any Shares redeemed by
Buyer in satisfaction of Sellers' obligations to Buyer under certain Promissory
Notes dated the date hereof (the "Notes").
2. Deemed Sales. For purposes hereof, if Sellers fail to (I) elect to
receive cash in any merger or other event involving the Buyer in which a cash
election is offered to Sellers at $5.00 or more per Share, (II) elect to
include Shares in a registered public offering or private offering in which the
Buyer offers to include the Stock Consideration for sale at $5.00 or more per
Share and such offering is effected at $5.00 per Share (in all such cases the
amount being received being calculated before selling commissions and expenses)
(each such event or circumstance in clauses I-II being a "Sale Opportunity" and
the price which would have been received being the "Sale Opportunity Price"),
then Sellers shall have been deemed to have sold the Shares that would have
been eligible for sale in each such Sale Opportunity at the Sale Opportunity
Price, allocating such Shares among such Sale Opportunities in a manner that
yields the greatest aggregate deemed sales proceeds. In the event a Seller
delivers Shares in repayment of the Note after the Payoff Date ("Note
Payments"), such Share payments shall be included as Deemed Sales for purposes
of calculating the payments due under Sections 4 and 5, with the Shares being
valued for purposes thereof as provided in Section 4.
For purposes hereof, "Buyer" shall include any entity into which Buyer
is combined and "Shares" shall mean shares of stock of the combining entity
given Sellers as consideration in such combination.
3. Sales. Sellers shall give the Buyer notice of their sales as
requested by Buyer from time-to-time, and shall give Buyer no less than 15
days' prior notice of any proposed sale or series of sales of Shares in excess
of 100,000 Shares.
4. Shortfall Payment. If on the Payoff Date a Seller's average sales
price for dispositions to which the guaranteed price in Section 1 applies and
Deemed Sales (the "Average Price") are less than $5.00 per Share, the Buyer
shall pay to such Seller an amount (the "Shortfall Payment") in cash equal to
the difference between (I) the product of $5.00 times the number of Shares sold
subject to the Guaranty and (II) the product of the Average Price times the
number of such Shares. Such payment shall be made within 90 days after
determination of the Shortfall Payment.
2
5. Excess Payment. If the Average Price (excluding Deemed Sales other
than Note Payments) for any Seller is greater than $5.00, then such Seller
shall pay to Buyer an amount equal to one-half of the difference between: (I)
the product of $5.00 times the number of Shares sold subject to the Guaranty,
and (II) the product of the Average Price times the number of such Shares. Such
payment shall be in cash and/or Shares (at the election of such Seller) within
90 days after determination of the Excess Payment amount.
6. Pledge of Shares. The parties shall enter into and deliver their
respective Pledge Agreements dated the date hereof to secure their obligations
hereunder.
IN WITNESS WHEREOF, Buyer and Sellers have duly executed and delivered
this Agreement as of the date first above written.
Dated: As of May 17, 2000
PROFESSIONAL TRANSPORTATION GROUP LTD., INC.
BY: /s/ Xxxxxx X. Xxxxx
--------------------------------------
Xxxxxx X. Xxxxx, President
-----------------------------------------
SERRA/XXXXXX LIVING TRUST
/s/ Xxxxxx Xxxxx
-----------------------------------------
Trustee
/s/ Xxxxx Xxxxxx
-----------------------------------------
Trustee
/s/ Xxxx Xxxxxx
-----------------------------------------
Xxxx Xxxxxx
