Attached files
| file | filename |
|---|---|
| 8-K - Saint James CO | v165179_8k.htm |
| EX-2.1 - Saint James CO | v165179_ex2-1.htm |
| EX-10.5 - Saint James CO | v165179_ex10-5.htm |
| EX-10.2 - Saint James CO | v165179_ex10-2.htm |
| EX-99.1 - Saint James CO | v165179_ex99-1.htm |
| EX-10.8 - Saint James CO | v165179_ex10-8.htm |
| EX-10.6 - Saint James CO | v165179_ex10-6.htm |
| EX-10.9 - Saint James CO | v165179_ex10-9.htm |
| EX-99.2 - Saint James CO | v165179_ex99-2.htm |
| EX-10.1 - Saint James CO | v165179_ex10-1.htm |
| EX-10.4 - Saint James CO | v165179_ex10-4.htm |
| EX-10.3 - Saint James CO | v165179_ex10-3.htm |
LOCK-UP
AGREEMENT
THIS
LOCK-UP AGREEMENT (this “Agreement”) is made as of this
____ day of October, 2009 (the “Effective Date”), by and among
The Saint James Company, a North Carolina corporation (the “Company”), and the other
parties listed on the signature pages hereto (each such party, a “Shareholder” and,
collectively, the “Shareholders”).
Recitals
A. The
Company, its wholly-owned subsidiary, The Saint James Eos Wine Company, a
California corporation (“Saint
James Eos”), and one of the Shareholders, among other persons, are
parties to a series of agreements, certain provisions of which relate to the
issuance of two million two hundred twenty-five thousand shares (the “Transaction Shares”) of the
Company’s common stock, par value $0.001 per share (the “Common Stock”), all of which
Transaction Shares are certificated in the name of one of the Shareholders and
constitute “restricted securities” as that term is defined in Rule 144(a)(3) of
Regulation D, as promulgated by the Securities and Exchange Commission (the
“Commission”). In
addition to the Transaction Shares, one of the Shareholders is the holder of the
Company’s Secured Promissory Note (the “Note”), convertible, from
time-to-time at such Shareholder’s option, into additional shares of Common
Stock in amounts to be calculated as of the conversion dates thereof (the “Note Shares”). In
addition to the Transaction Share and Note Shares, the Company and Saint James
EOS have agreed, contingent upon the achievement of certain milestones, to issue
up to three hundred thousand additional shares of Common Stock (the “Earnout Shares”).
B. Without
violating the restrictions on transfer set forth in this Agreement, the
Shareholders may transfer some or all of the Transaction Shares to one or more
affiliated persons (the “Shareholder Affiliates”), each
of whom (i) is listed as a potential transferee of Transaction Shares on Exhibit A attached
hereto, (ii) must be an “accredited investor” (as that term is defined in Rule
501(a) of Regulation D) as of the date of such transfer, and (iii) must become a
party to this Agreement in connection with such transfer.
C. Each
of the Shareholders has agreed to the terms set forth in this Agreement in order
to induce the Company into issuing and certificating the Transaction Shares and
permitting the potential conversion of the Note, the resulting issuance and
certification of the Note Shares, and the contingent issuance and certification
of the Earnout Shares.
D. Each
of the Shareholders has agreed that the Transaction Shares, the Note Shares, and
the Earnout Shares shall be subject to the restrictions on transfer set forth
herein and to all of the provisions hereof. The Transaction Shares,
the Note Shares, and the Earnout Shares shall be collectively referred to herein
as the “Agreement
Shares”; the Transaction Shares, as certificated as of the date of this
Agreement, shall be referred to herein as the “Transaction Share
Certificates”; and the Transaction Shares, the Note Shares, and Earnout
Shares, if, when, and as issued and certificated, shall be collectively referred
to herein as the “Agreement
Share Certificates.”
NOW,
THEREFORE, in consideration of the foregoing and the mutual promises and
agreements hereinafter contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1
Agreement
1. Transfers
by a Shareholder. In respect of the
Transaction Shares and Earnout Shares, the period that commences on the SEC
Effectiveness Date (as that term is defined in Section 1.2, below) and concludes
on the Transaction Termination Date (as that term is defined in Section 4.1,
below) is referred to herein as the “Transaction Transfer Restriction
Period.” In respect of the Note Shares, the period that
commences on the SEC Effectiveness Date and concludes on the Note Termination
Date (as that term is defined in Section 4.1, below) is referred to herein as
the “Note Transfer Restriction
Period.”
1.1 Restrictions on
Transfer. During the Transaction Transfer Restriction Period
or the Note Transfer Restriction Period, as relevant, no Shareholder shall
offer, sell, contract to sell, encumber, pledge, assign (except in respect of an
assignment to a revocable trust of which the Shareholder is the primary
beneficiary and the trust has executed this Agreement to become a party hereto
or from a Shareholder to one of the Shareholder Affiliates), transfer,
hypothecate, grant any option to purchase, grant a security interest in,
otherwise directly or indirectly dispose of, or otherwise alienate or obtain any
economic value from, or give (whether or not for value) (each, a “Transfer”) any of the
Agreement Shares, unless (x) such Transfer consists solely of Transaction Shares
and is made solely to a Shareholder Affiliate who has executed a copy of this
Agreement or (y) such Transfer of Agreement Shares has been (1) made in
accordance with the terms set forth in Sections 1.2 or 1.3, below, or (2)
otherwise approved as an amendment to this Agreement in the manner set forth in
Section 4.6, below. Further, during the Transaction Transfer
Restriction Period or the Note Transfer Restriction Period, as relevant, any
Transfer attempted to be made, purported to be made, or otherwise not made in
full accordance with this Agreement (including the provisions set forth in
subsections (x) and (y), above), shall be void. Accordingly, the
Company shall not, and shall not be obligated to, treat any such attempted or
purported transferee in any such unapproved, void transaction as a shareholder
or creditor of, or as a contracting party with, the Company for any
purpose.
1.2 Permitted Transfers of
Transaction Shares. In respect of the Transaction Shares and
Earnout Shares, for each 12-month period (each, a “Transaction Lapse Year”)
commencing on the date on which a resale Registration Statement in respect of
the Agreement Shares has been declared effective by the Securities and Exchange
Commission (the “SEC
Effectiveness Date”), the restrictions on
Transfer, as set forth in Section 1.1, above, shall lapse in the manner set
forth in this Section 1.2 and, from and after the Transaction Termination Date,
all of such restrictions on Transfer shall lapse. Except as limited
hereinbelow, during each Transaction Lapse Year, the restrictions on Transfer in
the percentage amounts set forth below of each Shareholder’s (or Shareholder
Affiliate’s) Transaction Shares and Earnout Shares shall lapse:
|
First
Transaction Lapse Year
|
up
to 20%, ratably by Transaction Lapse Year Quarter;
|
|
Second
Transaction Lapse Year
|
up
to 30%, ratably by Transaction Lapse Year Quarter;
|
|
Third
Transaction Lapse Year
|
up
to 30%, ratably by Transaction Lapse Year Quarter;
|
|
Fourth
Transaction Lapse Year
|
up
to 20%, ratably by Transaction Lapse Year
Quarter.
|
2
Notwithstanding
the above, if, during any relevant Transaction Lapse Year Quarter (except for
such quarters in the First Transaction Lapse Year), the Common Stock is then
listed for trading on the NYSE or The NASDAQ Stock Market (a “Stock Exchange”),
then the number of Transaction Shares and Earnout Shares in respect of which the
restrictions on Transfer may lapse shall be the lesser of such percentage or a
number that is equivalent to the aggregate number of shares of Common Stock sold
during the immediately preceding Transaction Lapse Year Quarter, as reported by
such Stock Exchange (net of all Transfers of Transaction Shares and Earnout
Shares by such Shareholder or Shareholder Affiliate during such immediately
preceding Transaction Lapse Year Quarter). If, however, during any
relevant Transaction Lapse Year Quarter, the Common Stock is then quoted for
trading on the OTC Bulletin Board, the Pink OTC Markets Inc., or other
interdealer quotation system (each, an “OTC Market”), then the number of
Transaction Shares and Earnout Shares in respect of which the restrictions on
Transfer may lapse shall be the lesser of such percentage or 50% of the
aggregate number of shares of Common Stock reported as having been traded during
the immediately preceding Transaction Lapse Year Quarter, as reported by the
relevant OTC Market (net of all Transfers of Transaction Shares and Earnout
Shares during such immediately preceding Transaction Lapse Year
Quarter).
If, as of
the end of each Transaction Lapse Year, any Shareholder has not had the
opportunity to Transfer such Shareholder’s relevant percentage, as set forth
above, during such Transaction Lapse Year, then, during the next succeeding
Transaction Lapse Year, the restrictions on Transfer shall be deemed to have
been modified for such year to permit a lapse of restrictions on Transfer of
that number of additional Transaction Shares and Earnout Shares equivalent to
15% of the aggregate amount of such Shareholder’s initial Transaction Shares and
Earnout Shares (net of any Transaction Shares and Earnout Shares transferred to
the Shareholder Affiliates), less those Transaction Shares and Earnout Shares
Transferred during the previous Transaction Lapse Year (the “Additional Lapse Transaction and
Earnout Shares”), in addition to the lapse of restrictions on Transfer in
respect of any other Transaction Shares and Earnout Shares whose restrictions on
Transfer would lapse during such Transaction Lapse Year. The
restrictions on Transfer of such Additional Lapse Transaction and Earnout Shares
shall be ratable by Transaction Lapse Year Quarter during such Transaction Lapse
Year.
1.3 Permitted Transfers of Note
Shares. In respect of the Note Shares, for each 12-month
period (each, a “Note Lapse
Year”) commencing on the SEC Effectiveness Date, the restrictions on
Transfer, as set forth in Section 1.1, above, shall lapse in the manner set
forth in this Section 1.3 and, from and after the Note Termination Date, all of
such restrictions on Transfer shall lapse. Except as limited
hereinbelow, during each Note Lapse Year, the restrictions on Transfer in the
percentage amounts set forth below of each Shareholder’s (or Shareholder
Affiliate’s) Note Shares shall lapse:
|
First
Note Lapse Year
|
up
to 20%, ratably by Note Lapse Year Quarter;
|
|
Second
Note Lapse Year
|
up
to 30%, ratably by Note Lapse Year Quarter;
|
|
Third
Note Lapse Year
|
up
to 30%, ratably by Note Lapse Year Quarter;
|
|
Fourth
Note Lapse Year
|
up
to 20%, ratably by Note Lapse Year
Quarter.
|
3
Notwithstanding
the above, if, during any relevant Note Lapse Year Quarter (except for such
quarters in the First Note Lapse Year), the Common Stock is then listed for
trading on the NYSE or The NASDAQ Stock Market (a “Stock Exchange”), then the
number of Note Shares in respect of which the restrictions on Transfer may lapse
shall be the lesser of such percentage or a number that is equivalent to the
aggregate number of shares of Common Stock sold during the immediately preceding
Note Lapse Year Quarter as reported by such Stock Exchange (net of all Transfers
of Note Shares by such Shareholder or Shareholder Affiliate during such
immediately preceding Note Lapse Year Quarter). If, however, during
any relevant Note Lapse Year Quarter, the Common Stock is then quoted for
trading on the OTC Bulletin Board, the Pink OTC Markets Inc., or other
interdealer quotation system (each, an “OTC Market”), then the number of Note
Shares in respect of which the restrictions on Transfer may lapse shall be the
lesser of such percentage or 50% of the aggregate number of shares of Common
Stock reported as having been traded during the immediately preceding Note Lapse
Year Quarter as reported by the relevant OTC Market (net of all Transfers of
Note Shares during such immediately preceding Note Lapse Year
Quarter).
If, as of
the end of each Note Lapse Year, any Shareholder has not had the opportunity to
Transfer such Shareholder’s relevant percentage, as set forth above, during such
Note Lapse Year, then, during the next succeeding Note Lapse Year, the
restrictions on Transfer shall be deemed to have been modified for such year to
permit a lapse of restrictions on Transfer of that number of additional Note
Shares equivalent to 15% of such Shareholder’s initial Note Shares (net of any
Note Shares transferred to the Shareholder Affiliates), less those Note Shares
Transferred during the previous Note Lapse Year (the “Additional Lapse Note
Shares”), in addition to the lapse of restrictions on Transfer in respect
of any other Note Shares whose restrictions on Transfer would lapse during such
Note Lapse Year. The restrictions on Transfer of such Additional
Lapse Note Shares shall be ratable by Note Lapse Year Quarter during such Note
Lapse Year.
1.4 Audit
Rights. Any party to this Agreement shall have the right at
any time, and from time to time, after a Transfer (other than a Transfer in
respect of an assignment to a revocable trust of which the Shareholder is the
primary beneficiary and the trust has executed this Agreement to become a party
hereto or a Transfer to a Shareholder Affiliate) of any Agreement Shares by a
Shareholder or a Shareholder Affiliate (each, a “Transferring Shareholder”), to
require such Transferring Shareholder to, and the Transferring Shareholder
shall, provide such requesting party (an “Auditing Party”) with a copy
of all documents or other materials or written memoranda of verbal
communications, which documentation shall evidence the date and nature of a
Transfer of Agreement Shares.
2. The
Company and its Transfer Agent. The Company is hereby
authorized, empowered, and directed to disclose the existence of this Agreement
to its transfer agent, to provide a copy hereof to its transfer agent, and to
instruct its transfer agent to put “stop-transfer” instructions on its books and
records in respect of all extant and subsequently certificated Agreement Shares,
other than those certificates, which, in accordance with the provisions of
Sections 1.2 and 1.3, above, and the other terms hereof, are to be deposited
with The Depository Trust Company, or another recognized depositary, for
re-registration into the name of its nominee, CEDE & Co., or a nominee of
such other depositary and, if the Common Stock is so eligible, into The
Depository Trust Company Automated Securities Transfer Program for crediting to
such Shareholder’s account. The Company and its transfer agent are
hereby authorized, empowered, and instructed not to authorize or effectuate,
directly or indirectly, any Transfer if such Transfer would constitute a
violation or breach of this Agreement.
4
3. Legended
Agreement Share Certificates.
3.1 Legend
Imprinting. Each Agreement Share Certificate shall be
presented to the Company or its transfer agent (and thereafter to the Company’s
transfer agent) for the imprinting of the following legend on the face
thereof:
“THE
SALE, ENCUMBRANCE, PLEDGE, ASSIGNMENT, TRANSFER, HYPOTHECATION OF, OR THE GRANT
OF AN OPTION OR SECURITY INTEREST IN THE SECURITIES REPRESENTED BY THIS
CERTIFICATE IS SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN LOCK-UP
AGREEMENT BY AND AMONG THE SHAREHOLDER, THE COMPANY, AND CERTAIN OTHER HOLDERS
OF COMMON STOCK OF THE COMPANY. COPIES OF SUCH AGREEMENT MAY BE
OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.”
3.2 Legend
Removal. The Company agrees that it will, no later than seven
business days following the delivery by any Shareholder, Shareholder Affiliate,
or their respective transfer agent of a Agreement Share Certificate representing
shares for which the restrictions on Transfer have lapsed as set forth in
Section 1.2 or Section 1.3, deliver or cause to be delivered to such
Shareholder, Shareholder Affiliate, or their respective transfer agent, as
applicable, an Agreement Share Certificate representing such shares that is free
from all restrictive and other legends. Certificates for stock subject to
legend removal hereunder shall be transmitted by the transfer agent to such
Shareholder by crediting the account of such Shareholder’s prime broker with the
Depository Trust Company System.
4. Miscellaneous
Provisions.
4.1 Term. Unless
earlier terminated pursuant to an amendment hereof, in respect of the
Transaction Shares and Earnout Shares, this Agreement shall terminate upon the
conclusion of the fourth Transaction Lapse Year (the “Transaction Termination Date”)
and, in respect of the Note Shares, this Agreement shall terminate upon the
conclusion of the fourth Note Lapse Year (the “Note Termination
Date”).
4.2 Ownership. Each
Shareholder represents and warrants that such Shareholder is the sole record and
beneficial owner of the Agreement Shares (except for the Transaction Shares that
may be assigned by a Shareholder to a Shareholder Affiliate, in respect of which
such Shareholder represents and warrants that the Shareholder Affiliate is the
beneficial owner of certain Transaction Shares), that all such Transaction
Shares are represented by Transaction Share Certificates, that no Note Shares
are issued and outstanding, and that, except as otherwise referenced in this
Section 4.2, no other person has any interest (other than a community property
interest) therein.
4.3 Notices. Unless
otherwise provided, any notice required or permitted pursuant to this Agreement
shall be given in writing and shall be deemed effectively given (i) upon
personal delivery to the party to be notified, (ii) two (2) days after deposit
with an overnight delivery service, or (iii) five (5) business days after
deposit with the United States Post Office by certified mail, return receipt
requested, postage prepaid, and addressed to the party to be notified at the
address indicated for such party on the signature page hereof, or at such other
address as such party may designate by ten (10) days’ advance written notice to
the other parties.
5
4.4 Successors and
Assigns. This Agreement and the rights and obligations of the
parties hereunder shall inure to the benefit of, and be binding upon, their
respective successors, assigns, and legal representatives.
4.5 Severability. In
the event one or more of the provisions of this Agreement should, for any
reason, be held to be invalid, illegal, or unenforceable in any respect, such
invalidity, illegality, or unenforceability shall not affect any other
provisions of this Agreement, and this Agreement shall be construed as if such
invalid, illegal, or unenforceable provision had never been contained
herein.
4.6 Amendments. No
provision of this Agreement may be waived or amended other than by a written
instrument executed and delivered by the Company and that number of
Shareholders, who as of their execution and delivery of such written instrument,
then hold not less than seventy-five percent (75%) of the then-extant Agreement
Share Certificates. No such amendment shall be effective to the
extent that it applies to less than all of the Shareholders. No
consideration shall be offered or paid to any party to amend or consent to a
waiver or modification of any provision of this Agreement unless the same
consideration is also offered to all of the parties hereto.
4.7 Governing Law;
Arbitration. This Agreement shall be governed by and construed
under the laws of the State of California as applied to agreements among
California residents entered into and to be performed entirely within
California. This Agreement shall be construed and interpreted without
regard to any presumption against the party causing this Agreement to be
drafted. Any dispute, controversy, or claim arising out of or
relating to this Agreement shall be resolved by binding arbitration before a
retired judge at JAMS in San Francisco, California. Any interim or
final arbitration award by be enforced by any court of competent
jurisdiction.
4.8 Counterparts. This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument, and any party to this
Agreement may execute this Agreement by signing any such counterpart; signature
pages may be detached from multiple separate counterparts and attached to a
single counterpart so that all signatures are physically attached to the same
counterpart. Delivery of an executed counterpart of a signature page
to this Agreement by hand, fax, or portable document format (.pdf) shall be
effective as the delivery of a fully executed counterpart of this
Agreement.
4.9 Further
Assurances. At any time, and from time to time, each party
will execute such additional instruments and take such action as may be
reasonably requested by any other party to carry out the intent and purposes of
this Agreement.
[Signature
Pages Follow]
6
IN WITNESS WHEREOF, the
parties have executed this Lock-Up Agreement as of the date first above
written.
THE
SAINT JAMES COMPANY
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By:
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Name:
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Title:
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Address:
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SHAREHOLDERS:
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Saphire Advisors, LLC
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381 Mallory Station Road, Suite
211
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[name]
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[street]
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Franklin, Tennessee
37067
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||
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[Signature]
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[city,
state, postal code, country]
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|
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[number
of Transaction Shares owned]
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[facsimile
number]
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|
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[name]
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[street]
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|
|
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||
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[number
of Transaction Shares owned]
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[city,
state, postal code, country]
|
|
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[facsimile
number]
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7
EXHIBIT
A
The
following individuals or entities and their successors, affiliates, and
beneficiaries:
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1.
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Jeffrey
Hopmayer and trusts for the benefit of Mr. Hopmayer and his family,
including without limitation, the Ashley Hopmayer Trust and Brittany
Hopmayer Trust
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2.
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Fred
Read
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3.
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Rick
Hannasch
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4.
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John
Murray Blackshear 2005 Grantor Retained Annuity
Trust
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5.
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Faye
and Murray Blackshear
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6.
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Burt
Stein
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7.
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Corporate
Benefits, c/o Don Brain
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8.
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Jeff
Richardson
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9.
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The
David R Teckman Trust
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10.
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The
Cheikha Family Trust
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11.
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Jeff
& Stacy Rothenberger
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8