EXHIBIT 4.2
STOCK SUBSCRIPTION AGREEMENT
This Stock Subscription Agreement (the "Agreement") is entered into as
of October 1, 2002 by and between American Sports Development Group, Inc., a
Delaware corporation with its principal place of business in South Carolina (the
"Company") and Xxxxxx Xxxxx, an individual resident in the State of California
("Buyer").
WHEREAS, the Buyer wishes to purchase 680,000 shares (the "Shares") of
the Company's common stock, par value $.001 per share (the "Common Stock") to be
newly issued by the Company to the Buyer and the Company wishes to issue and
sell the Shares to Buyer, all in accordance with the terms and provisions of
this Agreement;
NOW THEREFORE, in consideration of the mutual covenants set forth
herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto hereby agree as follows:
1. SALE OF SHARES; PURCHASE PRICE. Effective as of the date hereof, the
Company hereby sells the Shares to Buyer and Buyer hereby purchases the Shares
from the Company for a cash purchase price of $0.25 per Share for an aggregate
purchase price of $170,000 (the "Purchase Price").
2. BUYER' REPRESENTATIONS AND WARRANTIES. In order to induce the
Company to issue and sell the Shares to Buyer, Buyer hereby represents and
warrants to the Company as follows:
2.1 PURCHASE FOR INVESTMENT. Buyer is acquiring the Shares
pursuant to this Agreement for her own account for investment purposes
and not with a view to or intention of distribution or resale except
as described in Paragraph 2.2 and Paragraph 3 herein, and Buyer will
not dispose of any of the Shares in contravention of the Securities
Act of 1933, as amended (the "Securities Act") or any applicable state
securities laws.
2.2 SALE AND PURCHASE NOT REGISTERED. Buyer is aware that she
is acquiring the Shares from the Company in a transaction that has not
been registered under the Securities Act or pursuant to the securities
laws and regulations of any State, and that as a consequence, the
Shares are "restricted securities" as defined in Rule 144 promulgated
under the Securities Act ("Rule 144") and may be resold only to the
extent permitted by Rule 144 or any subsequent registration of the
securities via a registration statement per Paragraph 3 herein, or
pursuant to a transaction that is registered under the Securities Act
and applicable state securities laws and regulations, or pursuant to a
transaction that is exempt from such registration.
2.3 ACCREDITED INVESTOR. Buyer is an accredited investor
as that term is defined under Rule 144. Buyer is familiar with the
provisions of Rule 144 and understands the definition of "accredited
investor."
2.4 ACCESS TO INFORMATION. Buyer has had an opportunity to
ask questions and receive answers concerning the Shares and the
business and financial condition of the Company and has had full
access to (A) such information concerning the Company as she has
requested and (B) such other information that Buyer deems necessary or
desirable to make an informed investment decisions regarding the
purchase of the Shares.
2.5 ABLE TO BEAR ECONOMIC RISK. Buyer is able to bear the
economic risk of her investment in the Shares for an indefinite period
of time and can afford a total loss of her investment in the Shares.
2.6 BINDING OBLIGATION. This Agreement constitutes the legal,
valid and binding obligation of the Buyer, enforceable against her
in accordance with its terms.
3. "PIGGY-BACK" REGISTRATION RIGHTS. Except as otherwise provided
herein, whenever the Company proposes to register any of its securities under
the Securities Act of 1933, as amended (the "Securities Act"), at any time but
no later than November 12, 2002, the registration form to be used shall be one
which may be used for the registration of resales by Buyer of the Shares (a
"Piggyback Registration"). The Company will include in the Piggyback
Registration, at no cost of any kind to Buyer, all of the Buyer's Shares. The
Company shall act with due diligence in the preparation of the registration
statement and the provision of all necessary follow-up responses to the SEC,
with a view toward expeditious completion of the registration process.
Notwithstanding the forgoing, the Company may file Registration Statements on
Form S-8 with respect to the registration of securities issued or to be issued
to any employee, director, officer, consultant or advisor of the Company without
registering the resale by Buyer of the Shares as provided herein.
4. AMENDMENT; BINDING EFFECT; WAIVER. This Agreement shall not be
modified or amended except by means of a writing signed by each party hereto.
This Agreement shall be binding upon the parties hereto and their respective
heirs, executors, administrators, successors, and permitted transferees and
assigns. Any waiver of a right under the terms of this Agreement must be in
writing and signed by the waiving party.
5. SEVERABILITY. Each provision of this Agreement shall be considered
separable, and if for any reason any provision or provisions herein are
determined to be invalid or contrary to existing or future law, such invalidity
shall not impair the operation of this Agreement or affect those portions of
this Agreement which are valid.
6. COMPLETE AGREEMENT. This Agreement contains the complete agreement
among the parties relating to the subject matter hereof and controls and
supersedes any prior understandings, agreements or representations by or among
the parties, written or oral, which conflicts with, or may have related to, the
subject matter hereof in any way.
7. APPLICABLE LAW; FORUM; INDEMNIFICATION; ATTORNEY'S FEES. This
Agreement shall be interpreted, according to the laws of the State of South
Carolina, without giving effect to any provision of South Carolina law that
would cause the laws of any other jurisdiction, except for non-waivable
provisions of U.S. federal law, to apply. Buyer hereby irrevocably consents to
the non-exclusive jurisdiction of any court of the State of South Carolina and
any U.S. federal court sitting in Greenville County, South Carolina for the
adjudication of any dispute relating to the subject matter of this Agreement and
waives any claims and the right to make any motions of forum non conveniens or
the like that would change the forum or venue of any dispute relating to the
subject matter of this Agreement from any such court.
8. HEADINGS; CONSTRUCTION. The headings contained in this Agreement
are for convenience of reference only and are not intended to have any
substantive significance in interpreting this Agreement. The parties hereto
hereby acknowledge and agree that this Agreement is the result of negotiations
between the parties and that there shall be no presumption that any provision of
this Agreement shall be construed against any party because that party was or is
deemed the drafter of such provision or this Agreement.
9. COUNTERPARTS; PROOF OF EXECUTION. This Agreement may be executed in
multiple counterparts, each bearing the signatures of one or more of parties
hereto and each of which shall constitute an original, but which together shall
constitute a single instrument. The parties hereto hereby agree that rebuttable
proof of execution of this Agreement by any party may be made by a copy of this
Agreement bearing the facsimile or other copy of the signature of such party.
IN WITNESS WHEREOF, the parties hereto have set their signatures below
as of the date first set forth above.
AMERICAN SPORTS DEVELOPMENT
WITNESS: GROUP, INC.:
/s/ Xxxxxxx X. Xxxxxxxxx
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[signature] By: Xxxxxxx X. Xxxxxxxxx, President
Name:
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WITNESSES: BUYER:
/s/ Xxxxxx Xxxxx
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[signature] Xxxxxx Xxxxx
Name:
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