EXHIBIT 10.46
AGREEMENT
THIS AGREEMENT is dated this 30th day of June, 1997, by and between GFL
Ultra Fund, Ltd. ("Ultra"), a British Virgin Islands corporation, and
LS Capital Corporation ("LS"), a Delaware corporation.
I.
PURPOSE OF AGREEMENT
The purpose of this Agreement is (1) to settle and resolve all disputes
between the parties, including but not limited to, those allegations
raised in the litigation entitled GFL Ultra Fund v. Lone Star Casino
Corporation, Cause No. H-96-1423 presently pending in the United States
District Court for the Southern District of Texas, Houston Division
(the "Litigation") and (2) to establish a procedure by which Ultra will
convert the preferred shares it presently holds in LS.
II.
SETTLEMENT OF LITIGATION
LS agrees to pay Ultra $100,000, $25,000 of which is to be paid on or before
July 15, 1997, $50,000 of which is to be paid on or before September 30, 1997,
and $25,000 of which is to be paid on or before December 31, 1997. If all
payments are made on or before the described date, there will be no interest
owed on the payments. The payments will be secured by an Agreed Judgment, a copy
of which is attached hereto as Exhibit A, which LS will execute at the time of
the signing of this Agreement. Ultra hereby covenants not to execute on the
Agreed Judgment so long as payments are made timely. If any payment is
not
made timely, GFL will immediately execute on the Agreed Judgment after giving
5-days' notice to L-S. Notice shall be sent to 00000 Xxxx Xxxxxxx #000, Xxxxxxx,
Xxxxx 00000 and shall be deemed received by LS 3 days after said notice was
deposited by Ultra in the U.S. mails, first class, postage prepaid. Any
execution on the Agreed Judgment entered shall give credit for all amounts paid
by LS prior to the entry of the Agreed Judgment. However, Ultra shall be
entitled to its costs and attorneys' fees in the event execution on the Agreed
Judgment becomes necessary, as well as interest at the rate of 18% per annum on
any late payments.
III.
CONVERSION PROCEDURE
3.1 Simultaneously with the execution of this Agreement, Ultra agrees
to provide a legal opinion to the Escrow Agent and LS that the Escrowed
Shares can be resold under the securities laws of the United States.
The parties hereby agree that at the time of execution of
this Agreement, Ultra will convert its remaining Preferred shares in return for
600,000 shares of common stock of LS, which shall be deposited in escrow with an
escrow agent mutually agreed to by the parties (the "Escrowed Shares"). Escrow
fees shall be borne by Ultra. Attached hereto as Exhibit B are the form of
Escrow Instructions which will be provided to the Escrow Agent regarding the
Escrowed Shares. On or before June 30, 1997, LS shall prepare and execute any
and all other documents necessary to effectuate the transfer of the common
shares to Ultra, including but not limited to the following document Letter of
Instruction. The common shares deposited shall be in 25 certificates of 24,000
shares each for a total of 600,000 shares. Ultra shall be entitled to sell the
remaining shares, 24,000 per month for the next 24 months. All shares shall be
unlegended and shall not be subject to any stop-transfer restriction.
3.2 Dividend and Shares: if LS distributes shares of any other publicly
traded company to its shareholders, the shares received by Ultra shall be held
by the Escrow Agent and can only be sold in monthly amounts equal to the total
number of shares received divided by the number of months remaining on this
Agreement.
3.3 Ultra agrees to provide the Escrow Agent and LS with
confirmations of sales of the Escrowed Shares at least once
each month. Once Ultra receives $600,000 in proceeds net of
commissions from the sale of the Escrowed Shares, the escrow
agent shall return the balance of the Escrowed Shares to LS.
IV.
MUTUAL RELEASES
With the exception of the obligations undertaken in this
Agreement and in the document necessary to effectuate the
transfer of the common shares to Ultra, the parties agree to
release and discharge the other from any and all claims,
demands or suits, known or unknown, fixed or contingent,
liquidated or unliquidated, whether or not asserted in this
Litigation, as of this date, arising from or relating to the
events and transactions which are the subject matter to the
Litigation. This Mutual Release runs to the benefit of all
attorneys, agents, employees, officers, directors,
shareholders, parents, affiliates, and partners of the
parties. Ultra acknowledges that LS is not guaranteeing that
Ultra will receive $600,000 for the sale of the 600,000
shares,
V.
MISCELLANEOUS
5.1 Each party agrees that the terms of this settlement are to be held
confidential and not to be disclosed to any third party unless the
other party hereto consent in writing or unless ordered to do so by a
court of competent jurisdiction.
5.2 Each signatory hereto warrants and represents that he or
she has authority to bind the party for whom that signature
purports to act and that the claims, suits, right and/or
interest which are the subject matter hereto are owned by the
party asserting same, have not been assigned, transferred or
sold, and are free of encumbrance.
5.3 This agreement is made and performable in Xxxxxx
County, Texas and shall be construed in accordance with the
laws of the State of Texas as they presently exist.
5.4 Each Signatory to this settlement has entered
into the same freely without duress, having consulted with
professionals of his/her choice.
5.5 The parties agree that this Agreement is made pursuant to Section 154-071 of
the Civil Practice and Remedies Code and is not subject to revocation.
5.6 This Agreement represents the entire agreement of the par-ties hereto and
may not be changed orally, but only in writing,
LS CAPITAL CORPORATION
By: s/s Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx, President
GFL ULTRA FUND. LTD,
By: s/s X.X. xxXxxxx
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X.X. xxXxxxx, President
