EXHIBIT 10.1
AGREEMENT
This Agreement (the "Agreement"), effective as of the 31st day of
March, 2001, is executed by and among CTN Media Group, Inc., a Delaware
corporation (the "Company"), and U-C Holdings, L.L.C., a Delaware limited
liability company (the "Stockholder"), the sole holder of the Series A
Convertible Preferred Stock, $.001 par value per share, of the Company (the
"Series A Stock").
WHEREAS, the Stockholder and the Company are parties to that certain
Purchase Agreement, dated as of July 23, 1999, and that certain Amended and
Restated Purchase Agreement, dated as of October 18, 1999 (collectively, the
"Purchase Agreements"), pursuant to which the Stockholder purchased in multiple
closings an aggregate of 2,176,664 shares of Series A Stock;
WHEREAS, the rights and preferences of the Series A Stock are
designated in the Amended Second Certificate of Designation, Powers, Preferences
and Rights of the Series A Convertible Preferred Stock of CTN Media Group, Inc.
(the "Certificate of Designation") which forms a part of the Amended and
Restated Certificate of Incorporation, as amended, of the Company (the
"Certificate of Incorporation");
WHEREAS, the Certificate of Designation provides in Section 4 that at
the election of the holders of the majority of the outstanding shares of Series
A Stock, the Company shall redeem all outstanding shares of Series A Stock on
July 23, 2006, and provides certain procedures in the case of such a redemption;
WHEREAS, the Certificate of Designation provides in Section 2 that at
the election of the holders of the majority of the outstanding shares of Series
A Stock, any consolidation or merger of the Company or any sale or transfer by
the Company of all or any part of its assets shall be deemed to be a
liquidation, dissolution of winding up of the Company;
WHEREAS, the Certificate of Designation provides in Section 6 for
certain treatment of the Series A Stock in the event of a reorganization,
reclassification, consolidation, merger or sale of all or substantially all of
the Company's assets;
WHEREAS, the Company's common stock, $.005 par value per share (the
"Common Stock"), is currently approved for listing on the Nasdaq SmallCap Market
under the symbol "UCTN;"
WHEREAS, the Company is required to meet certain listing requirements
pursuant to the NASD Marketplace Rules (the "Listing Requirements") in order to
maintain its listing on the Nasdaq SmallCap Market;
WHEREAS, the Listing Requirements require that the Company maintain Net
Tangible Assets (as defined in Rule 4200 of the NASD Marketplace Rules) of at
least $2 million;
WHEREAS, due to the redemption rights of the Series A Stock, including
the redemption provisions contained in Section 4 of the Certificate of
Designation and the provisions regarding possible treatment of certain corporate
transactions as a liquidation contained in Sections 2 and 6 of the Certificate
of Designation, the Company may not meet the Listing Requirements;
WHEREAS, the listing of the Common Stock on the Nasdaq SmallCap Market
provides the company with statutory, regulatory and business advantages in
connection with being a publicly-traded company and a reporting company under
the Securities Exchange Act of 1934;
WHEREAS, the Company has determined that it is in the best interest of
the Company to maintain its listing on the Nasdaq SmallCap Market;
WHEREAS, the Stockholder has determined that it is in the best interest
of the Company and the Stockholder for the Company to maintain its listing on
the Nasdaq SmallCap Market;
WHEREAS, the Company and the Stockholder desire to amend the
Certificate of Designation to, among other things, eliminate redemption rights
as set forth in EXHIBIT A hereto (the "AMENDMENT");
WHEREAS, until the effectiveness of such amendment to the Certificate
of Designation, the Stockholder desires to waive the redemption rights in the
Certificate of Designation as set forth in EXHIBIT A hereto;
WHEREAS, the Certificate of Designation provides in Section 13 that no
amendment, modification or waiver shall be binding or effective with respect to
any provision of Sections 1 to 14 without the prior written consent of the
holders of a majority of the Series A Stock outstanding at the time such action
is taken and the General Corporation Law of Delaware requires the consent of the
holders of the Company's common stock to amend the certificate of incorporation
of the Company;
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. WAIVER. Notwithstanding anything to the contrary contained in the Certificate
of Designation, the Stockholder hereby agrees to waive the redemption rights in
the Certificate of Designation as set forth in EXHIBIT A hereto until the
effectiveness of the Amendment.
2. REMOVAL OF REDEMPTION RIGHTS. The Stockholder, being the holder of all the
outstanding shares of Series A Stock, hereby approves the removal of the
redemption provisions contained in Section 4 of the Certificate of Designation
and the amendment of Sections 2 and 6 of the Certificate of Designation as set
forth in EXHIBIT A attached hereto, and agrees to approve the Amendment as set
forth in EXHIBIT A hereto, in accordance with the provisions of Section 13 of
the Certificate of Designation and the General Corporation Law of Delaware, as
further
evidenced by the Stockholder's agreement to execute the Consent Action Taken by
Written Consent in Lieu of a Meeting attached hereto as EXHIBIT B to be executed
by the Stockholder.
3. VOTING AGREEMENT. The Stockholder hereby covenants and agrees, at every
meeting of stockholders of the Company called with respect to any of the
foregoing, and on every action or approval by written consent of the
stockholders of the Company with respect to any of the foregoing, to vote all
shares of Series A Stock, Common Stock, and any other shares of capital stock of
the Company held by the Stockholder, in favor of approval of the Amendment.
4. BINDING EFFECT ON TRANSFEREE. The Stockholder agrees that until such time as
the Amendment has been filed with the Secretary of State of the State of
Delaware, the Stockholder shall not sell, assign, transfer, pledge, hypothecate,
mortgage or dispose of, by gift or otherwise, or in any way encumber, all or any
part of the Series A Shares except to a transferee which agrees to be bound by
the terms of this Agreement by signing a Joinder to this Agreement, in
substantially the form attached hereto as EXHIBIT C.
5. A copy of this Agreement will be included in the books and records of the
Company.
6. This Agreement shall be governed by the laws of the State of Delaware,
without regard to its conflicts of laws principles, and may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
7. The Stockholder hereby agrees to waive the right to recognize the
effectiveness of the terms until after the amendment to the Certificate of
Designation, as set forth in Exhibit A hereto, has become effective in
accordance with the General Corporation Law of Delaware and rules of the
Securities and Exchange Commission.
8. This Agreement shall terminate immediately upon the effectiveness of the
amendment to the Certificate of Designation as set forth in EXHIBIT A hereto.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
CTN MEDIA GROUP, INC.
By: /s/ Xxxx X. Xxxxxxx
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Its: TREASURER
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U-C HOLDINGS, L.L.C.
By: Xxxxxx Xxxxx & Partners, L.P.
Its: General Partner
By: /s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
Its: Managing Director
EXHIBIT A
FORM OF
SECOND AMENDED SECOND CERTIFICATE OF DESIGNATION, POWERS,
PREFERENCES AND RIGHTS
OF THE
SERIES A CONVERTIBLE PREFERRED STOCK OF CTN MEDIA GROUP, INC.
[Attached]
EXHIBIT B
CONSENT ACTION OF THE MAJORITY STOCKHOLDER
AND THE SOLE SERIES A CONVERTIBLE PREFERRED STOCKHOLDER OF
CTN MEDIA GROUP, INC.,
TAKEN BY WRITTEN CONSENT IN LIEU OF A MEETING
[Attached]
EXHIBIT C
FORM OF
JOINDER AGREEMENT
This Joinder Agreement, dated as of ________, ____ (this "Joinder"), is
entered into by and among __________________ (the "Transferee") and CTN Media
Group, Inc., a Delaware corporation (the "Company"), pursuant to the terms of
that certain Agreement the ("Agreement"), dated as of _________, 2001, by and
among the Company and U-C Holdings, L.L.C., a Delaware limited liability company
("Holdings").
WITNESSETH
WHEREAS, the Company and Holdings are parties to the Agreement;
WHEREAS, the Transferee desires to purchase shares of Series A Stock
from Holdings;
WHEREAS, this Joinder is entered into pursuant to and in accordance
with the Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
1. Terms defined in the Agreement and used herein shall have the meanings given
them in the Agreement.
2. Transferee hereby acknowledges that it has received and reviewed a copy of
the Agreement, and acknowledges, agrees and confirms that, by its execution of
this Joinder, the Transferee will be deemed to be a party to the Agreement and
shall have all of the rights and obligations of the Stockholder thereunder as if
it had executed the Agreement. Transferee hereby ratifies, as of the date
hereof, and agrees to be bound by, all of the terms, provisions and conditions
contained in the Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Joinder as of
the date first written above.
CTN MEDIA GROUP, INC.
By:
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Its:
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TRANSFEREE
By:
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Its:
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