Exhibit 10.20
AMENDMENT TO AGREEMENT AND PLAN OF ORGANIZATION
THIS AMENDMENT (the "Amendment") to the Agreement and Plan of
Organization, dated as of June 2, 1999 (the "Agreement"), by and among Luminant
Worldwide Corporation, a Delaware corporation (f/k/a Clarant, Inc. and referred
to herein as "Luminant"), Free Range Media Acquisition Corp., a Washington
Corporation ("Newco"), Free Range Media Inc., a Washington Corporation (the
"Company"), and Xxxx X. Xxxxxx, Xxxx X. Xxxxxx, and Xxxxxx X. Xxx and (the
"Stockholders"), is made and entered into as of September 2, 1999.
RECITALS
A. Luminant, Newco, the Company and the Stockholders have determined that it is
in their best interests to revise the Agreement.
B. Luminant, Newco, the Company and the Stockholders desire to amend the
Agreement on the terms and subject to the conditions set forth herein.
C. All of the Other Founding Companies have simultaneously agreed to amend the
Other Agreements.
NOW, THEREFORE, in consideration of the premises, the mutual agreements
set forth herein, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follows:
1. Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Agreement. The term "Shares" means shares of
Luminant Common Stock. The term "Initial Holdings" means, with respect to each
Accredited Stockholder, the number of Shares issued to the Accredited
Stockholder at the Closing. All defined terms in the Agreement using the word
"Clarant" are hereby revised to use the word "Luminant." All references to the
term "Redemption" in the Agreement are hereby deleted.
2. The Agreement is amended to provide that the references in the
Agreement to "this Agreement" or "the Agreement" (including indirect references
such as "hereunder," "hereby," "herein" and "hereof") shall be deemed to be
references to the
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Agreement as amended hereby. To the extent that any provisions of the Agreement
as in effect prior to the effectiveness of this Amendment conflict with or
contradict the provisions of this Amendment, the provisions of this Amendment
shall control and shall supersede such inconsistent provisions.
3. EXHIBIT 2.1(a) of the Agreement is deleted in its entirety and
replaced with the EXHIBIT 2.1(a) attached hereto.
4. EXHIBIT 2.1(e) of the Agreement is deleted in its entirety and
replaced with the EXHIBIT 2.1(e) attached hereto.
5. Section 2.1(e) of the Agreement is hereby deleted in its entirety
and replaced with the following:
(e) At the Closing, Clarant shall withhold from Cash
Consideration payable to the Accredited Stockholders and
Non-Accredited Stockholders as follows:
(i) The amount of set forth on EXHIBIT 2.1(e)
necessary to satisfy in full the broker fee obligation
("Broker Fee") set forth on SCHEDULE 5.33;
(ii) The amount of cash the Preferred Stockholder
(the sole holder of preferred stock of the Company of record
as of the date hereof) is entitled to receive for dividends
declared and accrued with respect to his preferred stock of
the Company in accordance with the Charter Documents as of the
date of the Conversion ("Accrued Dividends") pursuant to the
terms set forth on EXHIBIT 2.1(e);
(iii) The amount of cash the Lender is entitled to
receive immediately prior to the Effective Time, as determined
according to the formula set forth on EXHIBIT 2.1(e), in
satisfaction of all interest accrued as of the Closing Date
("Accrued Interest") owed to the Lender pursuant to that
certain Master Borrowing Agreement by and between Free Range
Media, Inc. and Xxxx X. Xxxxxx (the "Lender") dated March 4,
1997 (the "Promissory Note").
The Broker Fee, Accrued Dividends, and Accrued Interest are
referred to collectively as the "Payment Obligations". At or
prior to the Closing, the Company may reallocate the amounts
withheld from the Cash Consideration among the categories
specified in clauses (i) - (iii) of this Section 2.1(e) as
necessary; PROVIDED, HOWEVER, that the Broker Fee and the
Accrued Interest shall be paid in full; PROVIDED FURTHER,
HOWEVER, that in no event shall any changes to the application
of the Cash Consideration increase the amount of the Cash
Consideration.
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6. The chapeau of Section 3.1 is deleted in its entirety and replaced
with the following:
3.1 MERGER CONSIDERATION; TENDER. At the Closing, Luminant
shall deliver to the stockholders of the Company and holders
of Options of the Company the considertion (the "Merger
Consideration") in accordance with EXHIBIT 2.1(a), less the
amount of cash to be withheld in satisfaction of the Payment
Obligations in accordance with the formulas set forth on
EXHIBIT 2.1(e) as follows:
7. EXHIBIT 3.3 is deleted in its entirety and replaced with the
EXHIBIT 3.3 attached hereto.
8. Section 3.4 is deleted in its entirety and replaced with the
following:
3.4 SATISFACTION OF THE PAYMENT OBLIGATIONS. The Payment
Obligations shall be paid by the Surviving Corporation
immediately after the Effective Time by wire transfer to the
Preferred Stockholder, the Lender, and the Broker respectively
pursuant to wire instructions to be provided to Luminant no
later than fifteen (15) days before the Closing. Upon receipt
of funds in satisification of the obligation to pay the
Accrued Dividends, the Preferred Stockholder shall deliver to
the Surviving Corporation, with a copy to Luminant, the
acknowledgement referred to in Section 7.14. Upon receipt of
funds in satisfaction of the obligation to pay the Accrued
Interest, the Lender shall deliver to the Surviving
Corporation, with a copy to Luminant, a written release of any
and all obligations with respect to the Accrued Interest. The
Stockholders shall cause the Broker, upon receipt of funds in
satisfication of the Broker Fee, to deliver to the Surviving
Corporation, with a copy to Luminant, a written release of any
and all obligations under the Broker Agreement. In the event
that the Cash Consideration is not sufficient to satisfy in
full the Payment Obligations, the Stockholders shall pay any
and all remaining amounts owed under such Payment Obligations.
9. Section 7.14 is deleted in its entirety and replaced with the
following:
7.14 CONVERSION OF PREFERRED STOCK. Prior to the Pre-Closing
Date, the Company shall convert, and the Stockholders shall
cause to be converted, all issued and outstanding preferred
stock of the Company before the Pre-Closing Date into an equal
number of common stock of the Company (the "Conversion"). Such
Conversion shall be in accordance with the Charter Documents
of the Company. The Preferred Stockholder shall execute and
deliver (i) all proper documents to cause such Conversion in
accordance with the Charter Documents and (ii) a full waiver
of any of his rights under the Charter Documents of the
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Company or other instruments or agreements relating to his
preferred stock of the Company. As of the date of the
Conversion, the Preferred Stockholder shall cease to accrue
dividends or hold any other rights associated with the
preferred stock and the Preferred Stockholder shall only be
entitled to receive shares of common stock of the Company in
accordance with the conversion formulas set forth in the
Charter Documents, such conversion shall be one share of
common stock of the Company in exchange for each share of
preferred stock of the Company. The Preferred Stockholder
and the Company shall execute a written acknowledgement of
the Conversion which (A) sets forth the specified number of
shares of preferred stock of the Company converted to a
specified number common stock of the Company, (B)
acknowledges the cancellation and extinguishment thereby of
all issued and outstanding shares of preferred stock, and
(C) sets forth the amount of any Accrued Dividends as of the
date of Conversion and acknowledge and agree that such
Accrued Dividends will be payable by the Surviving
Corporation immediately after the Closing in accordance with
the terms of EXHIBIT 2.1(e). Upon the Conversion of the
preferred stock of the Company, (1) the preferred stock
shall thereby be automatically cancelled and extinguished
and no longer deemed outstanding for any purpose, and (2)
there shall be no other issued and outstanding capital stock
of the Company other than the common stock of the Company.
10. Article 7 is hereby amended by adding the following new
section 7.17:
7.17 EXERCISE OF OPTIONS BEFORE IPO. The Stockholders agree to
use their commercially reasonable best efforts to cause
holders of Options, Convertible Securities and participation
rights, if any, that are currently exercisable or that will
become exercisable prior to Closing to refrain from exercising
such Options and Convertible Securities prior to the Closing.
11. Article 7 is hereby amended by adding the following new
section 7.18:
7.18 LOAN AGREEMENT. Prior to the Closing, the Company,
Lender, and Luminant shall enter into a loan agreement (the
"Loan Agreement") to modify the Promissory Note substantially
in accordance with the term sheet attached hereto as EXHIBIT
7.18. Simultaneous with the execution and delivery of such
Loan Agreement, Company shall issue to Lender a promissory
note in connection with such Loan Agreement. The obligations
of the Company under Loan Agreement and related documents
shall be assumed by the Surviving Corporation and survive the
Closing.
12. Section 9.19 is deleted in its entirety and replaced with the
following:
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9.19 CONVERSION OF PREFERRED STOCK AND CONTRIBUTIONS OF
CAPITAL. The Company shall deliver to Luminant (i) evidence of
the Conversion in accordance with Section 7.14; (ii) written
acknowledgement by the Preferred Stockholder of the Conversion
and cancelation and waiver in full of his rights as a
preferred stockholder of the Company in accordance with
Section 7.14; and (iii) evidence of the contribution to the
capital of the Company made by the Lender, if any, in
accordance with EXHIBIT 2.1(e).
13. Section 10.8 is deleted in its entirety and replaced with the
following:
10.8 SATISFACTION OF CERTAIN PAYMENT OBLIGATIONS. Immediately
after the Effective Time, the Surviving Corporation shall pay
in full, pursuant to Section 3.4, the amount set forth on
EXHIBIT 2.1(e) in satisfaction of the Accrued Dividends,
Accrued Interest and the Broker Fee. All obligations of the
Company with respect to the Accrued Dividends shall be
released in full by the Preferred Stockholder upon receipt of
such payment. The Preferred Stockholder upon receipt of such
payment shall immediately deliver to the Surviving
Corporation, with a copy to Luminant, a written release of all
obligations of the Company with respect to such Accrued
Dividends. All obligations of the Company with respect to the
Accrued Interest shall be released in full by the Lender upon
receipt of such payment. The Lender upon receipt of such
payment shall immediately deliver to the Surviving
Corporation, with a copy to Luminant, a written release of all
obligations of the Company with respect to Accrued Interest.
All obligations of the Company under the Broker Agreement
described on SCHEDULE 5.33 shall be released in full by the
Broker upon receipt of such payment. The Stockholders shall
cause the Broker, upon receipt of his respective payment, to
immediately deliver to the Surviving Corporation, with a copy
to Luminant, a written release of all obligations of the
Company under the Broker Agreement.
14. Article 10 is hereby amended by adding the following new
Section 10.9:
10.9 FORM S-8 FILING. Within thirty (30) days after the
Closing, Luminant agrees to file a registration statement on
Form S-8 pursuant to which eligible Persons holding options to
purchase Shares will be permitted to sell Shares to the
public. Persons holding the "Vested Options" in Luminant
identified on EXHIBIT 2.1(a) shall be prohibited from
exercising the Vested Options for a period of thirty (30) days
following the Closing.
15. Article 17 is hereby amended by adding the following new
Section 17.6:
17.6 SALE IN OVER-ALLOTMENT. The managing underwriter of the
IPO has requested an over-allotment option relating to the IPO
(the "Green Shoe").
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Luminant will provide the opportunity to each of the
Accredited Stockholders to sell up to fifteen percent (15%)
of the Stockholder's Initial Holdings pursuant to the Green
Shoe; provided however that Luminant may reduce pro rata the
number of Shares to be sold by the Accredited Stockholder,
the other Accredited Stockholders and the other members
and stockholders of the Other Founding Companies pursuant to
the Green Shoe if (a) Luminant determines that the inclusion
of all or any portion of the Accredited Stockholder's Shares
or the aggregate number of Shares proposed to be sold pursuant
to the Green Shoe by all members and stockholders of the
Founding Companies could adversely affect the "tax free"
status of the transactions contemplated in the Agreement and
the Luminant Plan of Organization; or (b) in the aggregate
stockholders and members of the respective Founding Companies
have subscribed to sell more Shares pursuant to the Green Shoe
than the total number of Shares that may be sold pursuant to
the Green Shoe. Any Accredited Stockholder desiring to sell
Shares pursuant to the Green Shoe must execute the
underwriting agreement relating to the IPO and otherwise
comply with customary procedures for selling shareholders.
Luminant agrees to pay the underwriting commisions and
discounts payable in respect of Shares sold pursuant to the
Green Shoe by the stockholders.
16. The third sentence of Section 17.1 is hereby deleted in its
entirety and replaced with the following: "In addition, if Luminant is advised
in writing in good faith by any managing underwriter of an underwritten offering
of the securities being offered pursuant to any registration statement under
this Section 17.1 that the number of Shares offered by any Persons (including
Luminant) is greater than the number of Shares that can be offered without
adversely affecting the offering, Luminant may reduce the number of Shares to be
offered by first reducing the number of Shares to be offered by Persons other
than Luminant, the Accredited Stockholders and the members and stockholders of
the Other Founding Companies, and second by reducing pro rata the number of
Shares to be offered by Luminant, the Accredited Stockholders and the members
and stockholders of the Other Founding Companies; provided however that in no
event shall the Shares to be offered by Luminant be reduced to less than fifty
percent (50%) of the offering; further provided that if the number of Shares to
be offered by Luminant is already less than or equal to fifty percent (50%) of
the offering, then the number of Shares to be offered by Luminant shall not be
reduced. Subject to the foregoing, the reduction in the Shares offered by
Luminant and the Accredited Stockholders and the stockholders and members of the
Other Founding Companies shall be effected on a pro rata basis; provided that to
the extent that a member or stockholder of a Founding Company has sold (in that
or a previous offering), or is being provided the right to sell, fifteen percent
(15%) or more of his or her Initial Holdings pursuant to any registration under
this Section 17.1, such holder's rights to be included in the offering shall be
subordinate to the rights of Luminant and the other members
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and stockholders of the Founding Companies."
17. Resolutions of the Board of the Company and the resolutions of the
stockholders of the Company approving this Amendment shall be adopted
substantially the form attached hereto as EXHIBIT 17 as soon as practicable
after the date hereof.
18. Section 12.1(b) is hereby amended by deleting "December 31, 1999"
on the 6th line, and inserting "October 15, 1999."
19. Except as herein provided, the Agreement shall remain unchanged and
in full force and effect.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized officers or representatives, as of
the date first above written.
LUMINANT WORLDWIDE CORPORATION
By: ____________________________
Name: ____________________________
Title: ____________________________
FREE RANGE MEDIA ACQUISITION CORP.
By: ____________________________
Name: ____________________________
Title: ____________________________
FREE RANGE MEDIA, INC.
By: ____________________________
Name: ____________________________
Title: ____________________________
STOCKHOLDERS:
___________________________________
Xxxx X. Xxxxxx
___________________________________
Xxxx X. Xxxxxx
___________________________________
Xxxxxx X. Xxx
