XXXXXXX 0
XXXXXXXXX XX. 0 TO THE
REGISTRATION RIGHTS AGREEMENT
THIS AMENDMENT NO. 1 TO THE REGISTRATION RIGHTS AGREEMENT (this
"Amendment") is made as of October 18, 1999 to the Registration Rights Agreement
dated May 28, 1999 (the "ORIGINAL AGREEMENT") among Successories, Inc., an
Illinois corporation (the "COMPANY"), and the holders of Series A Convertible
Preferred Stock of the Company (the "SERIES A PREFERRED STOCK"). This Amendment
is entered into by and among the Company and all of the holders of the Series A
Preferred Stock and Series B Preferred Stock (as defined herein).
W I T N E S S E T H:
WHEREAS, the Company previously granted to the holders of Series A
Preferred Stock of the Company, pursuant to the Original Agreement, certain
rights to register for sale the shares of Common Stock issuable to such holders
upon conversion of the Series A Preferred Stock or issued as dividends on or
otherwise in respect of the Series A Preferred Stock;
WHEREAS, the Company is issuing and selling 101,667 shares of Series B
Convertible Preferred Stock, par value $.01 per share, of the Company (the
"SERIES B PREFERRED STOCK") and desires to grant to the purchasers thereof the
same rights to register their shares that previously has been granted to the
holders of Series A Preferred Stock pursuant to the Original Agreement; and
WHEREAS, the Company and the holders of the Series A Preferred Stock
and Series B Preferred Stock desire to amend the Original Agreement to set forth
the terms and conditions on which the Company may be obligated to register for
sale the shares of Common Stock issuable to the Stockholders (as defined herein)
upon conversion of the Series A Preferred Stock and Series B Preferred Stock or
issued as dividends on or otherwise in respect of such shares, according to the
terms thereof.
NOW, THEREFORE, in consideration of the foregoing, and for other good
and valuable consideration, the receipt, sufficiency and adequacy of which are
hereby acknowledged, the parties hereto, intending legally to be bound, hereby
agree as follows:
1. DEFINITIONS. All capitalized terms used in this Amendment and
not otherwise defined herein shall have the meanings ascribed to such terms in
the Original Agreement. The following terms defined in the Original Agreement
are hereby amended, to the extent set forth below:
"STOCKHOLDERS" means, collectively, the holders of the
Preferred Stock and, individually, any holder of Preferred Stock, who
or which is a signatory to this Amendment.
"PREFERRED STOCK" means the 503,092 shares of Series A
Convertible Preferred Stock, par value $.01 per share, of the Company
and the 101,667 shares of Series B Convertible Preferred Stock, par
value $.01 per share, of the Company.
By virtue of these amended definitions, it is the intention of the parties
hereto that the term "Holders" as used in the Original Agreement include the
holders of Series A Preferred Stock and the holders of Series B Preferred Stock
and that the term "Registrable Securities" include all shares of Common Stock
issuable upon conversion of the Series A Preferred Stock and Series B Preferred
Stock, or issued as dividends on or otherwise in respect of such shares.
2. RIGHT TO ELECT DIRECTORS. Section 15(a) of the Original
Agreement is hereby amended and restated in its entirety to read:
(a) BOARD NOMINEES. For so long as any shares of Preferred
Stock remain outstanding, the Company (i) shall use its best efforts to
nominate three (3) persons designated by the Holders of a majority of
the Preferred Stock, voting together as a single class, for election to
the Board of Directors of the Company and to the classes of director
(Class I, II or III) designated by such Holders, and (ii) shall take
all actions necessary and use all reasonable endeavors (including
obtaining the consent of the officers, directors, significant
stockholders and affiliates of the Company) to ensure the election of
such three (3) persons to the Board of Directors.
3. VOTING MECHANICS. Whenever the request, consent or approval of
the Holders of a majority or other specified percentage of the Preferred Stock
is required under the Original Agreement, the presence or absence of request,
consent or approval shall be determined based upon the vote of the Holders of
the Preferred Stock voting together as a single class.
4. WAIVER AND CONSENT OF SERIES A HOLDERS. Each party to this
Amendment who or which owns Series A Preferred Stock hereby:
(a) acknowledges receipt of written notice of the
proposed issuance and sale of 101,667 shares of Series B Preferred
Stock in consideration for an aggregate purchase price of $1,525,005.00
(the "OFFERING");
(b) acknowledges that, upon completion of the Offering,
the Series B Preferred Stock will have the rights and privileges set
forth in the Amended and Restated Certificate of Designation of Series
A and Series B Convertible Preferred Stock of the Company, in
substantially the form attached hereto as EXHIBIT A, which rights are
equal or superior to the rights and preferences of the Series A
Preferred Stock;
(c) waives its or his preemptive rights, pursuant to
Section 6 of the Certificate of Designation of Series A Preferred Stock
of the Company as in effect
-2-
immediately prior to the Offering (the "CURRENT CERTIFICATE"), to
purchase shares of Series B Preferred Stock of the Company in
connection with, or otherwise to participate in, the Offering;
PROVIDED, HOWEVER, that this waiver is effective only with respect to
the Offering and such party does not waive any preemptive rights it or
he may have with respect to any future offering or sale of preferred
stock or other securities of the Company;
(d) waives its or his rights, pursuant to Section 4(e) of
the Current Certificate, to require the Company to reduce the
Conversion Price of the Series A Preferred Stock to reflect the
issuance and sale of the Series B Preferred Stock in the Offering; and
(e) pursuant to Section 5(c) of the Current Certificate,
consents to and approves of the filing by the Company of the Amended
and Restated Certificate of Designation, with substantially the terms
attached hereto as EXHIBIT A, the creation of the Series B Preferred
Stock and consummation of the Offering.
5. RATIFICATION OF ORIGINAL AGREEMENT. Except to the extent that
the Original Agreement is modified or amended by this Amendment, the terms and
provisions of the Original Agreement are hereby ratified and confirmed for all
purposes and in all respects. The holders of the Series B Preferred Stock agree
to be bound by the terms and conditions of the Original Agreement, as amended
hereby, and are entitled to all of the rights and benefits thereof.
6. GOVERNING LAW. This Amendment shall be governed by, and
construed in accordance with, the internal laws of the State of Illinois,
without regard to its principals regarding conflicts of law.
7. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
8. SEVERABILITY. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any law or public policy,
such provision shall be severed and the remaining provisions hereof shall be
enforced to the extent possible or modified in such a way as to make it
enforceable, and the invalidity, illegality or unenforceability thereof shall
not affect the validity, legality or enforceability of the remaining provisions
of this Agreement.
-3-
9. ASSIGNMENT. This Amendment and all the terms and provisions
hereof shall be binding upon and shall inure to the benefit of the parties
hereto, and their respective heirs, legal representatives, permitted successors
and permitted assigns. Except as expressly provided herein, no party may assign
its rights or obligations under this Amendment without the prior written consent
of the other party.
[Signature Page Follows]
-4-
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 to
the Registration Rights Agreement as of the date first above written.
THE COMPANY:
SUCCESSORIES, INC.
By: /S/ XXXXXX X. XXXXXXX
------------------------------------------
Xxxxxx X. Xxxxxxx,
Senior Vice President and Chief Financial
Officer
STOCKHOLDERS:
XXXXXX X. XXXXXX REVOCABLE TRUST
DATED JANUARY 21, 1983
By: /S/ XXXXXX XXXXXX
------------------------------------------
Xxxxxx X. Xxxxxx, not individually but
solely as trustee
XXXX XXXXXX FAMILY LIMITED
PARTNERSHIP #1
By: Xxxx Xxxxxx Trust Dated January 18, 1984,
its general partner
By: /S/ XXXX XXXXXX
------------------------------------------
Xxxx Xxxxxx, not individually but solely as
trustee of the general partner
[Signature Page to Amendment No. 1 to Registration Rights Agreement]
/S/ XXXX XXXXXXXX
----------------------------------------------
Xxxx X. Xxxxxxxx
XXXXXX X. XXXXXXXXX DECLARATION OF
TRUST DATED APRIL 28, 1987
By: /S/ XXXXXX XXXXXXXXX
----------------------------------------------
Xxxxxx X. Xxxxxxxxx, trustee
/S/ XXXX XXXXXXXX
----------------------------------------------
Xxxx Xxxxxxxx
[Signature Page to Amendment No. 1 to Registration Rights Agreement]
