SERIES A AMENDMENT AGREEMENT AND CONSENT
EXHIBIT
4(e)
SERIES
A AMENDMENT AGREEMENT AND CONSENT
THIS
SERIES A AMENDMENT AGREEMENT AND CONSENT, dated
as
of June 6, 2007, by and among Knobias, Inc., a Delaware corporation (the
“Company”); and each of the undersigned (each, a “Stockholder” and collectively,
the “Stockholders”).
WHEREAS,
each
Stockholder is a holder of the number of shares of the Company’s Series A
Preferred Stock, par value $0.01 per share (the “Series A Preferred Stock”) set
forth on Exhibit A attached hereto; and
WHEREAS,
the
Company, certain of the Stockholders and certain other parties have entered
into
a Letter of Intent (the “Letter of Intent”) regarding a proposed restructuring
of the debt and equity capitalization, and the amendment of certain outstanding
agreements, of the Company (the "Restructuring"), which includes, among other
things: (i) the amendment of the Certificate of Designation of the Series A
Preferred Stock (the “Certificate of Designation”) in order to eliminate certain
rights, preferences and privileges of the Series A Preferred Stock; (ii) an
offer by the Company to the Stockholders to convert their Series A Preferred
Stock into shares of Common Stock, par value $0.01 per share (the “Common
Stock”) of the Company; and (iii) the conversion of certain outstanding
indebtedness of the Company into shares of Series B Senior Convertible Preferred
Stock, par value $0.01 per share (the “Series B Preferred Stock”) of the
Company; and
WHEREAS,
the
Company believes the Restructuring to be in the best interests of the Company
and its stockholders; and
WHEREAS,
the
Company has entered into a Securities Purchase Agreement dated as of May 31,
2007 (the “Securities Purchase Agreement”), pursuant to which the Company will
issue Senior Secured Promissory Notes due May __, 2010 (the “New Senior Notes”);
and
WHEREAS,
the
execution and delivery of this Agreement and the execution and filing of the
Certificate of Designation of the Rights, Preferences and Privileges of the
Series B Preferred Stock, in the form attached hereto as Exhibit B (the “Series
B Certificate of Designation”) are conditions to the issuance of the Series B
Preferred Stock and the New Senior Notes.
NOW,
THEREFORE,
in
consideration of the premises set forth above, the proposed Restructuring and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the undersigned hereby agree as follows:
1. Consent
of Stockholders.
Each
Stockholder hereby consents to (i) the Amended and Restated Certificate of
Designation of Series A Preferred Stock, in the form attached hereto as Exhibit
C (the “Amended Certificate of Designation”) and the modifications to the
rights, preferences and privileges of the Series A Preferred Stock which are
effected thereby; (ii) the execution and filing of the Amended Certificate
of
Designation by or on behalf of the Company with the Secretary of State of the
State of Delaware, once the Company has received all necessary stockholder
approval for the Amended Certificate of Designation; (iii) the Series B
Certificate of Designation and the rights, preferences and privileges of the
Series B Preferred Stock which are created thereby; and (iv) the execution
and
filing of the Series B Certificate of Designation by or on behalf of the Company
with the Secretary of State of the State of Delaware. Each Stockholder
acknowledges and agrees that the execution and delivery of this Agreement by
such Stockholder shall be treated for all purposes as a vote or action by
written consent of such Stockholder in lieu of any meeting required pursuant
to
the Delaware General Corporation Law (“DGCL”), and hereby waives all
requirements of notice pursuant to the DGCL, the Bylaws of the Company, the
Certificate of Designation or otherwise, and, in the case of the Amended
Certificate of Designation, each Stockholder further acknowledges and agrees
that it shall vote, at a stockholders meeting called, to approve the Amended
Certificate of Designation and to authorize the Company to file the Amended
Certificate of Designation with the Secretary of State of the State of
Delaware.
Exhibit
4(e) - Page
1
2. Waiver
of Anti-Dilution Rights.
In
connection with the transactions comprising the Restructuring, including the
issuance of the Series B Preferred Stock and the New Senior Notes, each
Stockholder hereby waives any adjustment to the number of shares of Common
Stock
to be issued to the holders of the Series A Preferred Stock pursuant to Section
9 of the Certificate of Designation.
3. Termination
of Registration Rights Agreement.
The
Registration Rights Agreement, dated as of November 15, 2004, by and among
the
Company and each of the Stockholders, shall be and the same hereby is
terminated.
4.
Conversion
to Common Stock.
(a)
Each
Stockholder electing to convert shares of Series A Preferred Stock held by
such
Stockholder (the “Electing Stockholder”) has executed the Election to Convert
attached hereto as Exhibit D. The execution and delivery of the Election to
Convert shall constitute an irrevocable election by the Electing Stockholder
to
convert such shares into Common Stock, and shall be effective at such time
as
the Company has (i) received all necessary stockholder approval for the proposed
Amendment to the Amended and Restated Certificate of Incorporation of the
Company (the “Amendment”) and (ii) filed the Amendment with the Secretary of
State of the State of Delaware. All shares of Series A Preferred Stock which
shall have been surrendered for conversion as herein provided shall no longer
be
deemed to be outstanding and all rights with respect to such shares, including
the rights, if any, to receive notices and to vote, shall immediately cease
and
terminate on the date hereof, except only the right of the holders thereof
to
receive shares of Common Stock in exchange therefor.
(b)
Each
Stockholder who has not elected to convert shares of Series A Preferred Stock
held by such Stockholder (the “Non-electing Stockholder”) shall be deemed to
have made an irrevocable election to retain the Series A Preferred Stock and
not
to convert such shares into Common Stock.
5. Effectiveness.
This
Agreement shall be deemed effective when executed and delivered to the Company
by the holders of at least 51% of the issued and outstanding shares of Series
A
Preferred Stock.
Exhibit
4(e) - Page
2
6. Binding
Effect.
This
Agreement shall be binding upon the heirs, executors, administrators, successors
and assigns of the parties hereto..
7. Governing
Law.
This
Agreement shall be governed by and construed in accordance with the law of
the
State of New York.
8. Amendment.
This
Agreement may be amended only by an agreement in writing signed by all of the
parties hereto.
9. Severability.
If any
provision of this Agreement is declared invalid or unenforceable by a court
of
competent jurisdiction, such invalidity or unenforceability shall not affect
the
remainder of this Agreement which shall remain in full force and
effect.
10. Counterparts.
This
Agreement may be executed in several counterparts and all so executed shall
constitute one Agreement, binding on all the parties hereto even though all
the
parties are not signatories to the original or the same counterpart. Execution
and delivery of this Agreement by exchange of facsimile copies bearing the
facsimile signature of a party hereto shall constitute a valid and binding
execution and delivery of this Agreement by such party. Such facsimile copies
shall constitute enforceable original documents.
[Signature
pages follow]
Exhibit
4(e) - Page
3
IN
WITNESS WHEREOF,
the
undersigned have caused this Agreement to be duly executed by their respective
authorized signatories as of the date first indicated above.
| KNOBIAS, INC. | ||
| |
|
|
| By: | ||
|
Name: |
||
| Title: | ||
Exhibit
4(e) - Page
4
[STOCKHOLDER
SIGNATURE PAGE TO SERIES A AMENDMENT
AGREEMENT
AND CONSENT]
IN
WITNESS WHEREOF,
the
undersigned have caused this Agreement to be duly executed by their respective
authorized signatories as of the date first indicated above.
Name
of
Stockholder:
________________________________________________________
Signature
of Authorized Signatory of Stockholder:
__________________________________
Name
of
Authorized Signatory:
_________________________________________________
Title
of
Authorized Signatory:
__________________________________________________
Email
Address of Authorized
Signatory:__________________________________________
Address
for Notice of Stockholder:
__________________________________________
__________________________________________
__________________________________________
Exhibit
4(e) - Page
5
ELECTION
TO CONVERT
The
undersigned holder of Series A Preferred Stock, par value $0.01 per share (the
“Series A Preferred Stock”) issued by Knobias, Inc., a Delaware corporation (the
“Company”), hereby elects to convert ____________ shares of Series A Preferred
Stock held by the undersigned into shares of Common Stock, par value $0.01
per
share (the “Common Stock”) of the Company at the ratio of 124.623 shares of
Common Stock for every share of Series A Preferred Stock. The original
certificate for shares of Series A Preferred Stock is being tendered herewith
(duly endorsed for transfer) for cancellation upon the issuance of Common Stock
to the undersigned. It is understood and agreed that this irrevocable election
shall be effective at such time as the Company has (i) received all necessary
stockholder approval for the proposed Amendment to the Amended and Restated
Certificate of Incorporation of the Company (the “Amendment”) and (ii) filed the
Amendment with the Secretary of State of the State of Delaware (the “Effective
Date”)
The
undersigned hereby tenders to the Company the shares of Series A Preferred
Stock
indicated above. The undersigned hereby, as of the Effective Date:
(1) irrevocably
sells, assigns and transfers to or upon the order of the Company or its nominee
all right, title and interest in and to, and any and all claims in respect
of or
arising or having arisen as a result of the undersigned status as a holder
of,
all shares of Series A Preferred Stock tendered hereby, such that thereafter
it
shall have no contractual or other rights or claims in law or equity against
the
Company or any fiduciary, trustee, fiscal agent or other person connected with
the Series A Preferred Stock arising under, from or in connection with such
Series A Preferred Stock;
(2) waives
any and all rights with respect to the Series A Preferred Stock tendered hereby,
including, without limitation, any existing or past defaults and their
consequences in respect of such Series A Preferred Stock; and
(3) releases
and discharges the Company from any and all claims that the undersigned may
have, now or in the future, arising out of or related to the Series A Preferred
Stock tendered hereby.
All
authority conferred or agreed to be conferred by this Election to Convert shall
not be affected by, and shall survive, the death or incapacity of the
undersigned, and any obligation of the undersigned hereunder shall be binding
upon the heirs, executors, administrators, trustees in bankruptcy, personal
and
legal representatives, successors and assigns of the undersigned.
The
undersigned hereby represents, warrants and agrees that:
(1) it
is the
beneficial owner of, or a duly authorized representative of one or more
beneficial owners of, the Series A Preferred Stock tendered hereby, and it
has
full power and authority to execute this Election to Convert (for purposes
of
this Election to Convert, the “beneficial owner” of any Series A Preferred Stock
means any holder that exercises investment discretion with respect to such
Series A Preferred Stock);
Exhibit
4(e) - Page
6
(2) the
shares of Series A Preferred Stock being tendered hereby were owned as of the
date of tender, free and clear of any liens, charges, claims, encumbrances,
interests and restrictions of any kind, and the Company will acquire good,
indefeasible and unencumbered title to such shares of Series A Preferred Stock,
free and clear of all liens, charges, claims, encumbrances, interests and
restrictions of any kind;
(3) in
evaluating the Company’s exchange offer and in making its decision whether to
participate therein by submitting this Election to Convert and tendering shares
of Series A Preferred Stock, the undersigned has made its own independent
appraisal of the Company and it is not relying on any statement, representation
or warranty, express or implied, made to such holder by the Company or any
other
person, other than those contained in written communications from the Company
or
its duly authorized representatives, as amended or supplemented through the
date
hereof;
(4)
the
undersigned understands that the shares of Common Stock have not been registered
under federal or any state securities laws, and could not be sold or offered
for
resale unless they were subsequently so registered or an exemption from such
registration is available. The undersigned hereby acknowledges that the Common
Stock will not be sold, pledged, transferred or otherwise disposed of unless
(a)
registered under the Securities Act of 1933 and other applicable state
securities laws, or (b) an exemption from such registration is available. The
undersigned understands that the Company is issuing the Common Stock to the
undersigned pursuant to an exemption from registration in reliance on the
representations made by the undersigned herein.
(5)
the
undersigned has knowledge and experience in financial and business matters,
is
capable of evaluating the merits and risks of an investment in the Company
and
its proposed activities, has carefully considered the suitability of an
investment in the Company for the undersigned’s particular financial and tax
situation, and has determined that the shares of Common Stock are a suitable
investment. The undersigned has adequate means of providing for its current
needs and possible contingencies, and the undersigned has no present intention
or need, and anticipates no need in the foreseeable future, to sell the shares
of Common Stock. The undersigned is an “accredited investor” within the meaning
of Regulation D promulgated by the Securities and Exchange Commission and a
“qualified purchaser” within the meaning of Section 2 of the Investment Company
Act of 1940.
(6)
the
undersigned has the full legal authority, capacity and power to enter into
this
Agreement, and is not precluded by law, contract or otherwise from acquiring
the
shares of Common Stock.
(7) the
execution and delivery of this Election to Convert shall constitute an
undertaking to execute any further documents and give any further assurances
that may be required in connection with any of the foregoing, in each case
on
and subject to the terms and conditions.
Exhibit
4(e) - Page
7
Dated:
May ___, 2007
Name
of
Stockholder:
________________________________________________________
Signature
of Authorized Signatory of Stockholder:
__________________________________
Name
of
Authorized Signatory:
_________________________________________________
Title
of
Authorized Signatory:
__________________________________________________
Email
Address of Authorized
Signatory:__________________________________________
If
the
stock certificates evidencing shares of Common Stock are to be issued in the
name of a person other than as indicated above, please fill in the space
below.
ISSUE
TO:
Name: __________________________________
Address:
__________________________________
__________________________________
Taxpayer
I.D. Number: __________________________________
If
stock
certificates evidencing shares of Common Stock are to be mailed to an address
other than as indicated above, please fill in the space below.
MAIL
TO:
Name:
__________________________________
Address: __________________________________
__________________________________
Exhibit
4(e) - Page
8
