Exhibit 10.85
AMENDMENT NO. 2 TO SERIES C CONVERTIBLE
PREFERRED STOCK PURCHASE AGREEMENT
This Amendment No.2 (the "Amendment") dated as of September , 2004, is
made to that certain Series C Convertible Stock Purchase Agreement (the "Series
C Stock Purchase Agreement") dated as of September 4, 2003 and Amendment No. 1
as of December 31, 2003, by and between INSCI Corp., a Delaware corporation (the
"Company") and SCP Private Equity Partners II, L.P., a Delaware limited
partnership (the "Investor"), and is executed by the Company, the Investor and
CSSMK, LLC, a Massachusetts limited liability company with a principal place of
business located at 00 Xxxxxx Xxxx, Xxxxxxxx, XX 00000 ("CSSMK"). Capitalized
terms not otherwise defined in this Amendment shall have the same meaning as set
forth in the Series C Stock Purchase Agreement.
RECITALS
WHEREAS, the Company wishes to issue and sell additional shares of
Series C Preferred Stock and CSSMK wishes to purchase the shares (the
"Purchase"); and
WHEREAS, the Company and the Investor desire to amend the Series C
Stock Purchase Agreement to increase the total number of shares of Series C
Preferred Stock authorized to be sold to CSSMK, to include CSSMK as a party to
the Series C Stock Purchase Agreement, and to update certain other information;
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants hereinafter contained, the parties, agreeing to be
legally bound, hereto agree to the following:
1. AMENDMENTS. Effective as of the date hereof, the Series C
Stock Purchase Agreement shall be amended as follows:
1.1 DEFINITIONS. Together, the Investor and CSSMK shall be
referred to as the "Investors". Any reference to the "Investor" in Sections 2
(including Sections 2.1-2.28), 3.2, 3.3, 3.5, 3.6, 3.7, 7.1, 7.2 and 7.10 shall
be amended by deleting it and replacing it with the term "Investors". Annexed
hereto and made a part hereof is a true copy of the Agreement dated as of
September 4, 2003 and Amendment dated as of December 31, 2003.
1.2 A new Section 1.1 (d) is hereby added to the Agreement,
reading as follows: "Subject to the terms and conditions of this Agreement,
CSSMK agrees to purchase, and the Company agrees to sell and issue to the CSSMK,
51,557 shares of the Series C Preferred Stock at a price per share of $1.9396,
for an aggregate purchase price of $100,000 on September , 2004. The rights,
privileges and preferences of the Series C Preferred Stock shall be as stated in
the Designation."
1.3 Section 7.7 is amended to read in its entirety as follows:
NOTICES. "All notices and other communications hereunder shall be in writing and
shall be
deemed given if delivered personally or by commercial overnight courier (with
confirmation of receipt) or sent via facsimile (with confirmation of receipt),
(a) in case of the Company, to the Company at Xxx Xxxxxxxx Xxxxx, Xxxxx 000 X,
Xxxxxxxxxxx, XX 00000 (Fax No.: (000) 000-0000), Attention: President, with a
copy to Xxxxxxx & Xxxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000; (b) in the
case of SCP Private Equity Partners II, L.P., to SCP Private Equity Partners II,
L.P. at 0000 Xxxxxxx Xxxxx Xxxxx, Xxxxx 000; Xxxxx, Xxxxxxxxxxxx 00000 (Fax:
(000) 000-0000), Attention: General Counsel (or at such other address for a
party as shall be specified by like notice), with a copy to Xxxx Xxxxx LLP,
Centre Square West, 0000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxxxxx XX 00000-0000
(Fax: (000) 000-0000), Attention: Xxxxxxx X. Xxxx; in case of CSSMK, LLC, to 00
Xxxxxx Xxxx, Xxxxxxxx, XX 00000, Attention: Xxxxx X. Xxxxxx, (Fax: (508)
000-0000), with a copy to Xxxxxx & Roche, 00 XxXxxxx Xxxxxxx, Xxxxxx, XX 00000,
Attention: Xxxx Xxxxxx, (Fax: (000) 000-0000). Notice given by facsimile shall
be confirmed by appropriate answer back and shall be effective upon actual
receipt if received during the recipient's normal business hours, or at the
beginning of the recipient's next business day after receipt if not received
during the recipient's normal business hours. All notices by facsimile shall be
confirmed promptly after transmission in writing by certified mail or personal
delivery. Any party may change any address to which notice is to be given to it
by giving notice as provided above of such change of address."
2. Other Provisions.
2.1. CONSIDERATION. At the closing of the Purchase, the
Company shall deliver to CSSMK, a certificate representing 51,557 shares of the
Securities against payment of $100,000 by wire transfer or good check.
2.2 INVESTMENT EXPERIENCE. The Investor is an investor in
securities of companies in the development stage and acknowledges that it is
able to fend for itself, can bear the economic risk of its investment, and has
such knowledge and experience in financial or business matters that it is
capable of evaluating the merits and risks of the investment in the Securities.
The Investor also represents it has not been organized for the purpose of
acquiring the Securities. CSSMK acknowledges that it is an investment company,
and acknowledges that it is able to fend for itself, can bear the economic risk
of its investment, and has such knowledge and experience in financial or
business matters that it is capable of evaluating the merits and risks of the
investment in the Securities.
2.3 FURTHER LIMITATIONS ON DISPOSITION. Without in any way
limiting the representations made by them herein or heretofore, the Investor and
CSSMK each further agrees not to make any disposition of all or any portion of
the Securities or the Conversion Shares unless and until the transferee has
agreed in writing for the benefit of the Company to be bound by this Section and
the applicable provisions of the Amended and Restated Registration Rights
Agreement and:
(a) There is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(b) The party wishing to make the disposition shall have
notified the Company of the proposed disposition and shall have furnished the
Company with a detailed statement of the circumstances surrounding the proposed
disposition and, if requested by the Company, shall have furnished the Company
with an opinion of counsel, reasonably satisfactory to the Company that such
disposition will not require registration of such shares under the Act. It is
agreed that the Company will not require opinions of counsel for transactions
made pursuant to Rule 144 except in unusual circumstances or unless required by
a transfer agent.
Notwithstanding the provisions of subsections (a) and (b) above, no such
registration statement or opinion of counsel shall be necessary for a transfer
by the Investor to a partner of such partnership or a retired partner of such
partnership who retires after the date hereof, or to the estate of any such
partner or retired partner or the transfer by gift, will or intestate succession
of any partner to his or her spouse or to the siblings, lineal descendants or
ancestors of such partner or his or her spouse, if the transferee agrees in
writing to be subject to the terms hereof to the same extent as if he or she
were an original investor hereunder. Notwithstanding the foregoing, no such
registration statement or opinion of counsel shall be necessary for a transfer
by CSSMK to any of its Permitted Transferees (as defined under the Stockholders
Agreement dated as of December 31, 2003 by and among the Company, Investor. and
CSSMK).
(c) The Company represents to the Investor and CSSMK
that there have been no material adverse changes in the representations as set
forth in the September 4, 2003 Agreement and Amendment as of December 31, 2003,
and that the Independent Board of Directors of the Company has authorized and
approved the within sale of securities.
(d) CSSMK understands and agrees that the within
purchase transaction, will not cause an adjustment in the Series C Preferred
Stock Conversion Price under the Certificate of Designation with respect to such
series.
2.4 MISCELLANEOUS. Except as amended hereby, the Series C
Stock Purchase Agreement shall remain in full force and effect. This Amendment
shall be governed by the laws of the State of Delaware, and may be executed in
multiple counterparts, each of which shall be considered an original but all of
which shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have executed this Amendment to the
Series C Stock Purchase Agreement as of the date first above written.
COMPANY:
INSCI CORP.
By: /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
Title: CEO
INVESTOR:
SCP PRIVATE EQUITY PARTNERS II, L.P.
By: SCP Private Equity II General Partner,
L.P., its General Partner
By: SCP Private Equity II LLC
By: /s/ XXXXXXX XXXXXXXXX
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Name: Xxxxxxx Xxxxxxxxx
Title: a Manager
CSSMK:
CSSMK, LLC
By: /s/ XXXXX X. XXXXXX
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Name: Xxxxx X. Xxxxxx
Title: Manager
