CO-SALE AGREEMENT
this co-sale agreement (this 'agreement') is made and entered into as of _________,_________,_________(m/d/y) by and between aaa usa, inc., a _________(placename) corporation (the 'company'), (ii) bbb, inc. ('bbb') and (iii) ccc(sb) ('ccc(sb)').
a. concurrently herewith, bbb and the company are entering into that certain agreement, dated as of the date hereof (the 'principal agreement;' capitalized terms used herein and not otherwise defined shall have the meanings defined in the principal agreement), pursuant to which, among other things, bbb will acquire shares of common stock and warrants in consideration of the license by bbb of the bbb logos and the bbb content and provision by bbb of certain broadcast advertising and promotion.
b. to induce bbb to enter into the principal agreement, ccc(sb) has agreed to enter into this agreement and offer bbb the opportunity to participate in certain sales of his shares of common stock of the company.
now therefore, in consideration of the above recitals and the mutual covenants made herein, the parties hereby agree as follows:
1. right of co-sale.
1.1 notice of sales. in the event ccc(sb) proposes to accept one or more bona fide offers (collectively, the 'purchase offer') from any persons to purchase from him shares of the common stock of the company, he promptly shall give written notice (the 'notice') to bbb describing fully the purchase offer, including the number of shares of common stock proposed to be transferred (the 'shares'), the proposed bona fide transfer price and the name and address of the proposed transferee. the notice may be included as a part of any notice required to be given by ccc(sb) under article eight, section 1 of the company's bylaws.
1.2 participation right. to the extent that the company and other stockholders of the company have not exercised their respective rights of first refusal to purchase the shares in accordance with article eight of the company's bylaws, bbb shall have the right (the 'participation right') to participate in ccc(sb)'s sale of the shares under the terms and conditions specified in the purchase offer. to the extent bbb exercises its participation rights, the number of shares which ccc(sb) may sell pursuant to the purchase offer shall be correspondingly reduced. the participation right of bbb is subject to the following terms and conditions:
(a) number of shares. bbb may sell its pro rata share of the shares covered by the purchase offer. bbb's 'pro rata share' for purposes of this agreement is that number of shares of common stock equal to the product obtained by multiplying (i) the aggregate number of shares covered by the purchase offer, times (ii) a fraction, the numerator of which is the sum of the number of shares of common stock at the time owned by bbb and thedenominator of which is the aggregate number of shares of common stock at the time outstanding, assuming conversion of all outstanding preferred stock of the company and the exercise of all options and warrants then outstanding.