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EXHIBIT 10.30.1
AGREEMENT
This Agreement is made as of this 11th day of October, 1996 by and among
Cyrk, Inc., a Delaware corporation ("Cyrk"), Grant & Partners Limited
Partnership, a Massachusetts limited partnership ("GPLP"), Grant & Partners,
Inc., a Massachusetts corporation ("GPI"), and Xxxx Xxxxx, an individual
("Grant").
WHEREAS, Cyrk and GPI are parties to a First Amended and Restated
Agreement of Limited Partnership of Grant & Partners Limited Partnership dated
March 28, 1995 (the "Partnership
Agreement");
WHEREAS, Cyrk, GPLP and Grant are parties to a Contribution Agreement
dated as of March 28, 1995 (the "Contribution Agreement");
WHEREAS, Cyrk, GPI and Grant are parties to a Stock Restriction and
Governance Agreement dated as of March 28, 1995 (the "Stock Restriction and
Governance Agreement");
WHEREAS, Cyrk and Grant are parties to two separate Non- Qualified Stock
Option Agreements, one dated February 10, 1995 ("Option No. 1") and the other
dated March 28, 1995 ("Option No.
2");
WHEREAS, GPLP and Grant are parties to an Employment Agreement dated March
28, 1995 (the "Grant Employment Agreement");
WHEREAS, Cyrk and GPLP are parties to a Consulting Agreement dated March
28, 1995 (the "Consulting Agreement");
WHEREAS, Cyrk and GPLP are parties to a Revolving Credit Agreement dated
as of March 28, 1995 (the "Credit Agreement"); and
WHEREAS, the parties hereto wish to amend the Partnership Agreement, the
Contribution Agreement, the Stock Restriction and Governance Agreement, Option
Xx. 0, Xxxxxx Xx. 0, the Grant Employment Agreement, the Consulting Agreement
and the Credit Agreement (collectively, the "Original Agreements") as
hereinafter set forth.
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NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Section 12 of the Partnership Agreement will be amended to (i) delete
all references to the Performance Bonus Plan and (ii) provide that 100% of any
distributions made by GPLP will be allocated to Cyrk until such time as Cyrk
shall have received cumulative distributions in an amount (the "Cyrk Preference
Amount")equal to $3 million plus an amount equal to 20% per annum of the
unreturned portion of such $3 million (commencing April 1, 1995). The next $3
million in distributions will be allocated 100% to G&P. Thereafter,
distributions will be allocated in accordance with the respective percentage
interests of the partners.
2. Section 15 of the Partnership Agreement will be further amended to
provide that no equity interests in the Partnership may be granted without
Cyrk's consent.
The Partnership Agreement will be further amended to prohibit the
Partnership from making equity distributions at any time when (i) the
Partnership is indebted to Grant for money borrowed and (ii) Cyrk has not
received cumulative distributions from the Partnership equal to the Cyrk
Preference Amount.
3. The Credit Agreement will be amended to prohibit any distributions by
GPLP without Cyrk's consent at any time when there are outstanding borrowings
thereunder.
4. The Stock Restriction and Governance Agreement will be amended to
provide that Cyrk shall have the right to designate a majority of the directors
of G&P. The original agreement, insofar as it relates to the composition of the
G&P board, will be reinstated when (i) all borrowings under the Credit Agreement
have been repaid and (ii) Cyrk has received cumulative distributions from GPLP
equal to the Cyrk Preference Amount.
5. Section 4 of the Stock Restriction and Governance Agreement will be
amended to delete the requirement that the consent of one Grant board designee
is necessary to (i) sell GPLP, (ii) grant any equity interest in GPLP or (iii)
cause GPLP to distribute assets. Section 4 of the original agreement will be
reinstated when all borrowings under the Credit Agreement have been repaid and
(ii) Cyrk has received cumulative distributions from GPLP equal to the Cyrk
Preference Amount. Grant will have a right of first refusal with respect to any
proposed sale of GPLP or of any subsidiary.
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6. Section 6 of the Stock Restriction and Governance Agreement (which
restricts the activities of Cyrk and GPLP) will be deleted.
7. Option No. 1 and Option No. 2 will be cancelled.
8. Cyrk will reserve for issuance to employees of GPLP and its
subsidiaries options exercisable for an aggregate of 125,000 shares of Cyrk
stock. The exercise price of such options will be no less than the fair market
value of Cyrk stock on the date of grant. The persons to whom these options will
be granted (and the number of options each will receive) will be determined
jointly by Cyrk and Grant. Grant will be eligible for option grants from this
pool but any decision to make such a grant to him will be in the sole discretion
of Cyrk.
9. The Grant Employment Agreement will be terminated, except that the
non-competition and confidentiality provisions will survive in a separate
agreement. Grant will continue to serve as CEO of GPLP, subject to the
discretion of the G&P board. Grant's salary will be $300,000 per year, subject
to such increases as Cyrk may approve. Grant's salary will not be subject to
offset in the event of a breach of the Consulting Agreement. Grant will be
eligible for discretionary performance bonuses approved by the G&P board.
Grant's non-compete will be revised to provide that (i) if he is terminated
without cause he will be subject to the two-year non-compete but only if GPLP
continues to pay him at his then current salary level (which shall be at least
$300,000 per year), and (ii) if his responsibilities are substantially reduced
so as not to involve senior level strategic consulting, business development or
intellectual property creation, it will be deemed a "termination without cause".
10. The 3/29/1995 Performance Bonus Plan referenced in the Grant
Employment Agreement will be terminated.
11. The Credit Agreement will be amended as follows: (i) the expiration
date will be 3/28/1998, subject to automatic 1 year extensions thereafter unless
either party gives notice of termination, (ii) credit extensions will be fully
discretionary by Cyrk, (iii) credit limit will be $5 million, (iv) all interests
in the GPLP subsidiaries will be pledged to secure the credit line and (v) the
guaranty of each subsidiary will be capped at the amount of its borrowings from
GPLP.
12. Grant will loan GPLP an aggregate of $1 million, the repayment of
which will be subordinated to the Cyrk line of credit per the existing affiliate
subordination agreement. The terms of the Grant loan shall provide that in no
event shall it be payable before such time as Cyrk has received cumulative
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distributions from GPLP of at least $3 million. The Grant loan will be secured
by all assets of GPLP. The Grant loan may consist of (i) cash advances, (ii)
foregone salary accrued since 4/1/95 (assuming for purposes hereof that since
such date he was entitled to salary at the rate of $300,000 per year) and (iii)
previously made loans.
13. Section 5 of the Contribution Agreement (relating to Grant's
contingent repayment obligation with respect to the $3 million) will be deleted.
14. GPLP will pay the fees and disbursements of Xxxxxx, Xxxx & Xxxxxxx
relating to the reorganization of GPLP. Cyrk will pay the fees and disbursements
of Xxxxxx, Hall & Xxxxxxx relating to the amendment of the Original Agreements.
15. Each party agrees to execute any and all further agreements and
instruments as may be reasonably necessary to implement and formalize the
foregoing provisions.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
CYRK, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, President
GRANT & PARTNERS LIMITED
PARTNERSHIP
By: Grant & Partners, Inc., its
general partner
By: /s/ Xxxx X.X. Xxxxx
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Xxxx Xxxxx, President
GRANT & PARTNERS, INC.
By: /s/ Xxxx X.X. Xxxxx
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Xxxx Xxxxx, President
/s/ Xxxx X.X. Xxxxx
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Xxxx Xxxxx
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