Fax: 719-590-4888
Exhibit
10.1
DTLL
March
19,
2006
Board
of
Directors
GLOBAL
CASINOS, INC
0000
Xxxxx Xxxx, Xxxxx X
Boulder,
CO 80301
Fax:
000-000-0000
RE:
Proposed Transaction
Dear
Members of the Board,
This
letter is to outline our intentions to enter into Share Exchange Agreements
(“Agreements”) with Global Casinos, Inc (“GCI”) shareholders as follows:
| (1) |
Pursuant
to the terms and conditions of the Agreement, the holders of common
shares
will exchange $2.50 per share of GCI common stock in exchange for
newly
authorized DTLL Series B GCI Preferred as per the attached term
sheet.
|
| (2) |
DTLL
is highly confident that it closes the transaction on or before April
30,
2006 subject to any required
approvals.
|
| (3) |
DTLL
will enter into two year management contracts with the designated
management team to implement the agreed upon business
plan.
|
We
look
forward to working with the company to close this transaction and agree to
keep
this offer open until 5 pm EST on Friday March 31, 2006.
Sincerely,
Dual
Xxxxxx
President
Destination
Travel Leisure International
0000
Xxxx 00xx
Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, XX 00000
This
Term
Sheet summarizes the principal terms of the purchase by DTLL, Inc., a Minnesota
corporation (the “Company”) of up to one hundred percent (100%) of the common
stock of Global Casinos, Inc, a Colorado corporation (“GCI”). Any purchase of
GCI’s common stock shall be made only pursuant to a mutually acceptable share
exchange agreement and related documentation executed by the Company, GCI and
the selling shareholders. It
is
expressly understood that no liability or obligation of any nature whatsoever
is
intended to be created by this Term Sheet between the parties signing below,
except
as
otherwise indicated herein. The
Company reserves the right in its sole discretion to accept or reject this
transaction. This
Term
Sheet does evidence the good faith intention of the parties signing below to
proceed with the proposed transaction on the conditions and terms described
herein, subject to customary conditions, including due diligence, legal review
and documentation that is satisfactory to the parties.
|
NON-BINDING
PROVISIONS
|
||
|
Issuer:
|
DTLL, Inc. | |
|
Securities
to be Issued by the Company:
|
The
Company will issue one share of its Series B Preferred Equity Redeemable
Convertible Stock, (“Series B Preferred”) for every ten (10) shares of GCI
common stock which are exchanged.
|
|
|
Minimum/Maximum
Offering:
|
The
minimum number of shares of common stock of GCI that the Company
will
purchase is fifty-one percent (51%) of its issued and outstanding
shares.
In the event that less than fifty-one percent (51%) of the shareholders
of
GCI elect to exchange their shares for the Series B Preferred, then
the
Company will not issue any Series A Preferred and this offering shall
terminate. The maximum number of shares that the Company will purchase
is
one hundred percent (100%) of the issued and outstanding shares of
common
stock of GCI. The Company reserves the right to lower the minimum
percentage in its sole discretion.
|
|
|
Closing:
|
The
closing (the “Closing”) shall occur on or before April 30, 2006 and at
such time and place as is mutually agreed upon by the
parties.
|
|
|
Dividends:
|
The
Series B Preferred will carry a 7% cumulative dividend compounded
annually, payable in cash or in kind, at the Company’s
option.
|
2
|
Liquidation
Preference:
|
Upon
liquidation, the holders of the Series A Preferred shall be entitled
to
receive, in preference to holders of other classes of common stock,
$50
per share plus accrued dividends. Thereafter, any proceeds available
for
distribution will be distributed pro rata to holders of common
stock.
|
|
|
Voting
Rights:
|
The
holders of Series B Preferred shares shall be entitled to one vote
per
share in all matters upon which shareholders of the Company are entitled
to vote.
|
|
|
Optional
Conversion:
|
The
Series B Preferred shall be convertible 1:1 to common stock of the
Company
at any time at option of holder, subject to adjustments for stock
dividends, splits, combinations and similar events. The conversion
price
shall be based on the average of the price of the Company's stock
in the
10 consecutive trading days immediately preceding the date that the
conversion notice is given by the holder.
|
|
|
Mandatory
conversion:
|
The
Company will have the ability to cause the Series B Preferred holders
to
convert their stock into common stock if (i) a registration statement
is
effective and available for use by the holders of the Series B Preferred
on the date the conversion notice is given by the Company, and (ii)
the
closing price of the common stock exceeded 125% of the conversion
price
subject to adjustment based on the average price of the Company's
stock in
the 10 consecutive trading days immediately preceding the date that
the
conversion notice is given by the Company.
|
|
|
Redemption
Rights:
|
The
Series B Preferred shall be redeemable from funds legally available
for
distribution at the option of holders of at least 51% of the Series A
Preferred commencing any time after the third anniversary of the
Closing
at a price of $35 per share of Series B Preferred, subject to adjustments.
Upon such a redemption request, the shares of the holders of the
Series A
Preferred shares that requested such a redemption shall be
redeemed.
|
|
|
Undertaking
to Register the Shares:
|
The
Company shall undertake and agree to use its best efforts to: (i)
file, as
soon as practicable the Closing, a registration statement with the
SEC in
order to register the shares of Common Stock issuable the upon the
conversion of the Series B Preferred shares; and (ii) to cause such
registration statement to become effective.
|
3
|
Representations
and Warranties:
|
Standard
representations and warranties by the Company, GCI and the shareholders
of
GCI shall be contained in the share exchange agreement and related
transaction documents.
|
|
|
Mandatory
Redemption Fund:
|
Within
a reasonable time period after the Closing, the Company shall fund
a
mandatory redemption fund pursuant to which the Company shall pay
the
Series B Preferred shareholders a fixed price per share which shall
increase on each anniversary of the Closing.
|
|
|
No
Partnership:
|
Nothing
contained herein will be deemed to or construed by the parties hereto
or
by any third person to create the relationship of principal and agent
or
partnership or joint venture.
|
|
|
Term
and Termination:
|
Unless
extended by mutual agreement in writing of the parties, or earlier
terminated by mutual agreement in writing of the parties, the term
of this
Term Sheet shall be from the date hereof until the earliest of: (i)
ten
days after written notice given by the Company, GCI or fifty percent
(50%)
or more of the shareholders of GCI; (ii) twenty-one (21) days from
the
date of this letter; or (iii) the date of execution by the parties
of a
definitive Securities Purchase Agreement (the “Term”). Upon any
termination or expiration of this Term Sheet, none of the Company,
GCI,
the shareholders of GCI or their affiliates shall have any obligation
or
liability to any other party under this Term Sheet, except with respect
to
breaches that occurred during the Term. Notwithstanding the foregoing,
the
provisions contained under the heading “Exclusivity” and "No Trading DTLL
Shares" shall survive any termination of this Term Sheet.
|
|
|
BINDING
PROVISIONS
|
||
|
Exclusivity:
|
Without
the prior approval of the Company, for a period of twenty-one (21)
days
from the date set forth below neither GCI nor any of GCI’s shareholders,
directors, principals, officers, employees, agents or representatives
will
solicit, knowingly encourage or entertain proposals from or enter
into
discussions or continue negotiations or discussions with or furnish
any
nonpublic information to any other person or entity regarding the
possible
sale of some or all of GCI's stock, including and without limitation,
the
fact that such discussions are taking place and the status thereof
and the
terms and conditions of any transaction under consideration, other
than as
required by law. If this exclusivity agreement is breached, in addition
to
any other compensation for damages, GCI and/or its shareholders,
jointly
and severally, shall promptly upon demand pay to the Company an amount
equal to all expenses incurred by the Company in connection with
this
proposed transaction, including the expenses of their agents, advisors,
bankers, investment partners, attorneys, accountants and other
representatives. For purposes of clarification, GCI and its shareholders
during the period outlined above, shall deal exclusively with the
Company
concerning the sale of the shares of common stock of GCI and discontinue
any discussions with respect to any previously received third party
proposals with respect to the sale of such shares.
|
|
|
No
Trading DTLL Shares:
|
GCI
and each GCI shareholder hereby acknowledge that they are in receipt
of
“inside information” as such term is defined by applicable securities laws
and agree that they will not, individually or collectively, buy,
sell or
trade any shares of DTLL during the
Term.
|
[SIGNATURES
ARE ON THE FOLLOWING PAGE]
4
|
Xxxxxx
and accepted this
|
Agreed and accepted this |
|
___
day of March, 2006
|
___ day of March, 2006 |
|
Global
Casinos, Inc
|
DTLL,
Inc.,
|
| a Colorado corporation | a Minnesota corporation |
| By: ____________________ | By: ______________________ |
|
Its:____________________
|
Its:_______________________ |
Shareholders
of Global Casinos, Inc
a
Colorado corporation
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
By:_________________________________
Printed
Name:________________________
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