AMENDMENT NO. 1 TO THE STOCKHOLDERS AGREEMENT
This AMENDMENT NO. 1 TO THE STOCKHOLDERS AGREEMENT (this "Amendment") is
dated as of September 5, 2001, and entered into by and among XXXX XXXXX, Xxxxx
XxxxxxXx Investment Management, Inc. and ATHANOR HOLDINGS, LLC ("Athanor").
RECITALS
WHEREAS, Xxxx Xxxxx, Xxxxx Xxxxxxxx Investment Management, and Athanor have
entered into that certain Stockholders Agreement dated as of August 15, 2001
(the "Stockholders Agreement"), pursuant to which they entered into a voting
agreement with respect to certain matters related to The Right Start, Inc.
("Right Start") and covenanted to perform or to cause to be performed certain
actions for the benefit of the other;
WHEREAS, Right Start and Athanor have amended the Investment Agreement (as
defined in the Stockholders Agreement) to provide for certain changes to the
securities issued thereunder;
WHEREAS, Xxxx Xxxxx and Xxxxx Xxxxxxxx Investment Management, as an
inducement to Athanor in respect of the foregoing, and Athanor have decided to
amend the Stockholders Agreement to reflect the changes in their obligations as
a result of such amendment to the Investment Agreement;
NOW, THEREFORE, in consideration of these premises, the agreements,
provisions and covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto hereby agree as follows:
AGREEMENT
1. Defined Terms. Capitalized terms used but not otherwise defined herein
shall have the meanings given in the Stockholders Agreement or the Investment
Agreement, as amended.
2. Covenant to vote to approve the convertibility feature of the
Convertible Note and of sufficient shares of Common Stock: Xxxx Xxxxx and Xxxxx
Xxxxxxxx Investment Management each severally agree with Athanor that he/it will
vote all securities of Right Start held by them which are entitled to vote
thereon in favor of all matters necessary to approve the conversion feature of
the Convertible Note and any PIK Notes issued pursuant thereto.
3. Representation and Warranty regarding share ownership and covenant to
cause approval of the issuance of shares and of the conversion feature of the
Convertible Note: Xxxx Xxxxx and Xxxxx Xxxxxxxx Investment Management represent
and warrant to Athanor that they jointly own sufficient shares of Right Start to
cause, and will cause, on the terms and conditions set forth in the Investment
Agreement, the shareholders of Right Start to approve the conversion feature of
the Convertible Note (and any PIK Notes issued pursuant thereto) and the
authorization by Right Start's shareholders of sufficient additional Common
Stock to permit the conversion of the Convertible Note and of the maximum number
of PIK Notes issuable pursuant to the Convertible Note.
4. Calculation of Ownership Percentage. Notwithstanding anything to the
contrary in this Agreement, determination of Athanor's percentage ownership of
the outstanding Common Stock shall, for all purposes under the Stockholders
Agreement, be calculated on the basis that all securities convertible into
Common Stock (including any PIK Notes) of Xxxx Xxxxx, Xxxxx Xxxxxxxx Investment
Management and Athanor have been converted in full.
5. Effect of Amendment; Ratification. From and after the date of this
Amendment, all references in the Stockholders Agreement to the Stockholders
Agreement shall mean the Stockholders Agreement as amended hereby. The terms and
provisions set forth in this Amendment are in addition to and supplemental to
the terms and provisions set forth in the Stockholders Agreement and the terms
and provisions of the Stockholders Agreement are hereby ratified and confirmed,
together with the terms and provisions set forth in this Amendment, and are and
shall continue in full force and effect.
6. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. Delivery via facsimile of an executed counterpart of a
signature page of this Amendment shall be effective as delivery of a
manually-executed counterpart of this Amendment.
7. Governing Law. This Amendment shall be governed by, and shall be
construed and enforced in accordance with, the internal laws of the State of
California, without regard to conflicts of laws principles.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to the Stockholders Agreement to be duly executed by a duly authorized officer
as of the date first above written.
/s/ Xxxx Xxxxx
Xxxx Xxxxx
Xxxxx Xxxxxxxx Investment Management, Inc.
By: /s/ Xxxxx Shladowsky
Name: Xxxxx Shladowsky
Its: General Counsel
ATHANOR HOLDINGS, LLC
By: /s/ Xxxxxxx Xxxxxxx
Name: Xxxxxxx Xxxxxxx
Title: Manager
By: /s/ Xxxxxxx Xxxxx
Name: Xxxxxxx Xxxxx
Title: Manager
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