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EXHIBIT 10.28
PARK 'N VIEW, INC.
AMENDMENT TO SECURITIES RESTRICTION AGREEMENT
THIS AMENDMENT (the "Amendment") is made as of the 22nd day of August,
1997, by and among Park 'N View, Inc., a Delaware corporation (the "Company"),
the investors set forth on Exhibit A attached hereto and made a part hereof (the
"Existing Investors"), the holders of Series B Preferred Stock set forth on
Exhibit B attached hereto and made a part hereof (the "Investors" or the "Series
B Holders"), the holders of shares of Series C Convertible Preferred Stock of
the Company set forth on Exhibit C attached hereto and made a part hereof (the
"Series C Holders") and Alex. Xxxxx & Sons Incorporated as the holder of a
warrant to purchase shares of the Company's Common Stock (the "Agent" and
together with the Existing Investors, the Investors and the Series C Holders,
the "Securityholders").
WHEREAS, the Existing Investors, the Investors and the Company are
parties to a Securities Restriction Agreement dated November 13, 1996 (the
"Securities Restriction Agreement");
WHEREAS, in connection with the Company's (i) offering of 7% Series C
Cumulative Convertible Preferred Stock (the "Series C Stock") and (ii) issuance
to the Agent of a warrant (the "Agent's Warrant") to purchase shares of the
Company's Common Stock, the Company has agreed to grant the Series C Holders and
the Agent co-sale rights with respect to shares of the Common Stock of the
Company issuable upon conversion of the Series C Stock and issuable upon
exercise of the Agent's Warrant and the Series C Holders and the Agent have
agreed to sell their shares under certain circumstances;
WHEREAS, in connection with the sale of the Series C Stock, all parties
to the Securities Restriction Agreement desire to amend the Securities
Restriction Agreement to include the Common Stock issuable upon the conversion
of the Series C Preferred Stock and upon exercise of the Agent's Warrant as
Securities thereunder and to amend certain portions of the Securities
Restriction Agreement to reflect the agreement concerning co-sale rights and
obligations to sell Securities in certain circumstances among the Series C
Holders, the Agent and the Company;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree to amend the
Securities Restriction Agreement as follows:
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1. Definitions.
(a) The first sentence of the Definitions Section shall
be deleted in its entirety.
(b) The following terms shall be added to the Definitions
Section of the Securities Restriction Agreement:
"Affiliate" includes a person or organization that, directly or
indirectly, through one or more intermediaries, controls, is controlled by or is
under common control with another person or organization.
"Holders" shall mean the Persons who shall, from time to time, own, of
record or beneficially, and Security. The term "Holder" shall mean any one of
the Holders.
"Person" means an individual, a corporation, a partnership, a trust, a
limited liability company, an unincorporated organization or a governmental
organization or any agency or political subdivision thereof.
"Series A Stock" shall mean the Preferred Stock of the Company
designated as Series A Preferred Stock, par value $.01 per share.
"Series B Qualified Sale" means a Sale or exchange of the then
outstanding Common Stock (except for shares of Common Stock issuable upon
conversion of the Series C Stock) and Series B Stock for cash or other
securities which is (a) approved by at least (x) 70% of the directors and (y)
two of the directors designated by the holders of the Series A Stock and the
Series B Stock and (b) the stated consideration is at least equal to an amount
which (i) would represent, on an as converted basis, a compound annual rate of
return of 35% to the Series B Holders based upon the original issuance price of
the Series B Stock, or (ii) is 200% of the then conversion price of the Series B
Stock.
"Series B Qualifying Offering" shall mean that (i) the Company shall
have consummated a firm commitment underwritten public offering of its Common
Stock by a nationally recognized investment banking firm pursuant to an
effective registration under the Securities Act of 1933, as amended, covering
the offering and sale of both primary and secondary shares of Common Stock which
results in gross proceeds of at least $20,000,000, (ii) the Common Stock is
quoted or listed on either The Nasdaq Stock Market (National Market), The New
York Stock Exchange or the American Stock Exchange, and (iii) the price at which
the Common Stock is sold in such offering is at least equal to an amount which
(x) is 200% of the then effective conversion price of the Series B Stock or (y)
would represent, on an as converted basis, a compound annual rate of return of
35% based upon the original issuance price of the Series B Stock.
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"Series B Stock" shall mean the Preferred Stock of the Company
designated as Series B 7% Cumulative Convertible Preferred Stock pursuant to the
Certificate of Designation for the Series B Stock.
"Series C Qualified Sale" means a Sale or exchange of the then
outstanding shares of Series c Stock and the shares of Common Stock issuable
upon conversion thereof for cash or other securities which is (a) approved by at
least (x) 70% of the directors and (y) the director designated by The Xxxxxxx
Company and (b) the stated consideration is at least equal to an amount which
(i) would represent, on an as converted basis, a compound annual rate of return
of 35% to the Series C Holders based upon the original issuance price of the
Series C Stock, or (ii) is 200% of the then conversion price of the Series C
Stock.
"Series C Qualifying Offering" shall mean that (i) the Company shall
have consummated a firm commitment underwritten public offering of its Common
Stock by a nationally recognized investment banking firm pursuant to an
effective registration under the Securities Act of 1933, as amended, covering
the offering and sale of both primary and secondary shares of Common Stock which
results in gross proceeds of at least $20,000,000, (ii) the Common Stock is
quoted or listed on either The Nasdaq Stock Market (National Market), The New
York Stock Exchange or the American Stock Exchange, (iii) the price at which the
Common Stock is sold in such offering is at least equal to an amount which (x)
is 200% of the then effective conversion price of the Series C Stock or (y)
would represent, on an as converted basis, a compound annual rate of return of
35% based upon the original issuance price of the Series C Stock and (iv) all
outstanding shares of the Company's Series B Stock shall have been converted
into shares of the Company's Common Stock in accordance with the Certificate of
Designation relating to the Series B Stock and all outstanding shares of the
Company's Series A Stock shall have been redeemed in accordance with the
Certificate of Designation relating to the Company's Series A Stock.
"Series C Securities Purchase Agreement" shall mean that certain Stock
Purchase Agreement, dated as of August 22, 1997, by and between the Company and
each of the Series C Holders.
"Series C Stock" shall mean the Preferred Stock of the Company
designated as Series C 7% Cumulative Convertible Preferred Stock pursuant to the
Certificate of Designation for the Series C Stock.
(c) The term "Qualified Sale" shall be deleted.
(d) The first clause of the term "Securities" shall be
amended as follows:
"Securities" shall mean at any time, the shares of then outstanding
Common Stock, Series B Stock and Series C Stock
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2. Rights of Co-Sale.
(a) The first sentence of Subsection (A) of Section 1
shall be amended to replace the term "Qualifying Offering" with "Series
B Qualifying Offering" delete the term "Investors" and replace such
term with "Series B Holders" and to insert the words "of record"
between the words "own" and "50%."
(b) Subsection (A) of Section 1 shall be amended to add
the following sentence as the second sentence of the first paragraph:
Prior to a Series C Qualifying Offering and for so long as the Series C
Holders and their Affiliates own of record 50% or more of the
Securities purchased pursuant to the Series C Securities Purchase
Agreement, in the event that a Selling Securityholder desires to sell
any or all of the shares of Common Stock (excluding shares of Common
Stock issuable upon conversion of Series C Stock) owned by such
Securityholder and receives a bona fide offer therefor, such Selling
Securityholder shall so notify the Series C Holders and the Agent in
writing.
(c) The parenthetical in the third sentence of the
second paragraph of Subsection (A) of Section 1 shall be replaced with
the following:
(or Series B Stock or Series C Stock convertible into such
number of shares of Common Stock)
3. Legend. The reference to the Securities Restriction Agreement
in the stock legend shall be amended as follows:
except as provided in that certain Securities Purchase
Agreement dated as of November 13, 1996 and amended on August
22, 1997.
4. Miscellaneous. Subsection (A) of Section 4 shall be amended to
replace the "and" immediately proceeding romanette (iv) with a comma and to add
romanette (v) as follows:
and (v) Securityholders owning 66 2/3% of the Series
C Stock.
5. Investor. Whenever referenced in Section 1 of the Securities
Restriction Agreement, the term "Investor" shall be deleted and replaced with
"Investor, Series C Holder and the Agent, as applicable" and the term
"Investors" shall be replaced with "Investors, the Series C Holders and the
Agent, as applicable."
6. Binding Agreement. The Registration Rights Agreement as
modified herein, shall remain in full force and effect as so modified.
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7. Counterparts. This Amendment may be executed simultaneously
in two or more counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument. The authentic
signature of any party received by facsimile transmission shall constitute a
valid and binding signature of such party.
[The Remainder of this Page is Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties have executed this Amendment as of the
__th day of ________________, 1997.
COMPANY Investors
/s/ Xxx Xxxxxxxx
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Park 'N View, Inc. The Existing Investors whose
By: Xxx Xxxxxxxx signatures appear on Exhibit A hereto,
President and Chief the Investors whose signatures
Executive Officer appear on Exhibit B hereto and the
Series C Holders whose signatures
appear on the respective Omnibus
Signature Pages
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EXHIBIT A
PARK 'N VIEW GENERAL PARTNER, INC.
By: /s/ Xxx Xxxxxxxx
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Name: Xxx Xxxxxxxx
Title: President
/s/ Xxx Xxxxxxxx /s/ Xxxx Xxxxxxxxx
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Xxx Xxxxxxxx Xxxx Xxxxxxxxx
/s/ Xxx Xxxxxxx /s/ Xxxxxxx Xxxxxxxxx
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Xxx Xxxxxxx Xxxxxxx Xxxxxxxxx
/s/ for MPN Partners, Ltd.
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MPN Partners, Ltd.
NELGO INVESTMENTS
By: /s/ Xxxxxx X'Xxxxxxx
-----------------------------------
Name: Xxxxxx X'Xxxxxxx
Title: General Partners
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APA EXCELSIOR IV, L.P.
By: APA EXCELSIOR IV PARTNERS, L.P.
(Its General Partner)
By: PATRICOF & CO. MANAGERS, INC.
(Its General Partner)
By: /s/ Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: X.X.
XXXXXX & CO. (CAYMAN) LTD., CUSTODIAN FOR
APA EXCELSIOR IV/OFFSHORE, L.P.
By: PATRICOF & CO. VENTURES, INC., INVESTMENT ADVISOR
By: /s/ Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: G.P.
THE P/A FUND, L.P.
By: APA PENNSYLVANIA PARTNERS, L.P.
(Its General Partner)
By: /s/ Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: G.P.
/s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
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EXHIBIT B
STATE OF MICHIGAN RETIREMENT SYSTEM
By: /s/ Xxxxx Xxxx
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Name: Xxxxx Xxxx
Title: Acting Administrator Alternative Investments Division
BENEFIT CAPITAL MANAGEMENT CORPORATION,
as Investment Manager for The Prudential Insurance Co.
of America, Separate Account No. VCA-GA-5298
By: /s/
--------------------------------
Name:
Title:
CSK VENTURE CAPITAL CO., LTD.
as Investment Manager for CSK-1(A), CSK(B), CSK-2 Investment Fund
By: /s/ Masahiro Aozono
--------------------------------
Name: Masahiro Aozono
Title: President
CREDIT SUISSE (GUERNSEY) LIMITED as
Trustee of Dynamic Growth Fund II
By: /s/ X. Xxxxxx-Xxxxxxx
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Name: B. Xxxxxx Xxxxxxx
Title: Member Senior Management
By: /s/ M E Zuning
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Name: M E Zuning
Title: Associate
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APA EXCELSIOR IV, L.P.
By: APA EXCELSIOR IV PARTNERS, L.P.
(Its General Partner)
By: PATRICOF & CO. MANAGERS, INC. (Its General Partner)
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: X.X.
XXXXXX & CO. (CAYMAN) LTD., CUSTODIAN FOR
APA EXCELSIOR IV/OFFSHORE, L.P.
By: PATRICOF & CO. VENTURES, INC.,
INVESTOR ADVISOR
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: G.P.
THE P/A FUND, L.P.
By: APA PENNSYLVANIA PARTNERS, L.P.
(Its General Partner)
By: /s/ Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
Title: G.P.
/s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
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EXHIBIT C
Holders of Shares of Series C Preferred Stock
Name Number of Shares
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Venhill Limited Partnership 187,500
Juliet Challenger, Inc. 625,000
Xxxxx X. Xxxxxxx, Xxxxx Xxxxxxxx Xxxxxxx and X.X.
Xxxxxxxxxxxx, Trustees of the Xxxxx X. Xxxxxxx
Trust U/A dated 11/18/85 187,500
X.X. Xxxxxxxxxxxx and Xxxxxx X. Xxxxxx, Trustees
U/A/T dated 8/28/68 for Juliet Xxx Xxxxxxx 62,500
X.X. Xxxxxxxxxxxx and Xxxxxx X. Xxxxxx, Trustees
U/A/T dated 8/28/68 for Xxxxxx Xxxxxxxx Xxxxxxx 62,500
X.X. Xxxxxxxxxxxx and Xxxxxx X. Xxxxxx, Trustees
U/A/T dated 8/28/68 for Xxxxx Xxx Xxxxxxx, Xx. 62,500
X.X. Xxxxxxxxxxxx and Xxxxxx X. Xxxxxx, Trustees
U/A/T dated 8/28/68 for Xxxxxxx Xxxxxxx Xxxxxxx 62,500
Winfield Capital Corp. 93,750
ABS Employees' Venture Fund Limited Partnership 17,662
Xxxxxxxx Xxxxxxx 15,750
Arundel Lumber Company, Inc. 15,625
E. Xxxx Xxxxxx 375
Xxxxx Xxxx Family Foundation 15,625
Xxxxxxx XxxXxxxx 12,500
Xxxx X. Xxxxxxxxx 12,500
Xxxxxxx X. Xxxx 3,125
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Xxxxxxx X. Xxxxxxxx Trust #2 12,500
Xxxxx X. Xxxxx 31,250
Xxxxxxx Xxxxxx 15,625
Xxxx Xxxxxx 16,000
Xxxxxx Xxxxx and/or Xxxxxx Xxxxx, as Tenants - by -
Entirety 16,250
Xxxxxx Xxxxxx & Xxxxx X. Xxxxxx, as Tenants - by -
Entirety 6,256
Xxxxx X. XxXxxxxx 12,500
Xxxx Xxxxxxx 37,500
Spiegel Enterprises 15,625
Tampsco Partnership XII 125,000
Foundation Partners Fund, G.P. 125,000
Tennyson Private Placement Fund, LLC 62,500
Xxxxx X. Xxxxxxxxx 25,000
Tri Ventures 15,625
Benefit Capital Management Corporation as
Investment Manager for The Prudential Insurance
Company of America, Separate Account No. VCA-GA-5298 125,000
State Treasurer of the State of Michigan, Custodian
of the Michigan Public School Employees' Retirement
System, State Employees' Retirement System,
Michigan State Police Retirement System, and
Michigan Judges Retirement System 125,000
APA Excelsior IV, L.P. 92,500
Xxxxxx & Co. (Cayman) LTD., Custodians for
APA/Excelsior IV/Offshore, L.P. 16,250
The P/A Fund, L.P. 16,250
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Total 2,328,543
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