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EXHIBIT 99.1
STOCKHOLDERS AGREEMENT
August 15, 2001
In connection with Investment Agreement dated as of even date herewith (the
"Investment Agreement"), between Athanor Holdings, LLC ("Athanor") and The Right
Start, Inc. ("Right Start"), and as an inducement to Athanor to enter into the
Investment Agreement Xxxx Xxxxx and Xxxxx Xxxxxxxx Investment Management, Inc.
each severally agree with Athanor that he/it will (i) convert the convertible
securities of Right Start (other than employee or director options) held by them
not later than the date that the Convertible Preferred Stock is converted and
(ii) vote all securities of Right Start held by them which are entitled to vote
thereon (A) in favor of all matters necessary to approve the conversion of the
Convertible Preferred Stock (including a vote to approve making the Convertible
Preferred Stock pari passu with the Series A Convertible Preferred Stock, the
Series B Convertible Preferred Stock and the Series C Convertible Preferred
Stock) and, (B) in favor of the election of 3 directors designated by Athanor at
each election of directors hereafter until such time as Athanor holds less than
20% of the outstanding Common Stock, 2 directors until such time as Athanor
holds less than 15% and 1 director until such time as Athanor holds less than
10% (calculated in each case on the basis that the Convertible Preferred Stock
has been converted).
Athanor agrees that it will vote the shares held by it in favor of (i) the
election of 3 directors designated jointly by Xxxxx Xxxxxxxx Investment
Management and Xxxx Xxxxx until such time as such parties hold less than 20% of
the outstanding Common Stock, 2 directors until such time as such parties hold
less than 15% and 1 director until such time as such parties hold less than 10%
and (ii) the election of the Chief Executive Officer as a director.
Xxxx Xxxxx and Xxxxx Xxxxxxxx Investment Management represent and warrant
to Athanor that they jointly own sufficient shares of Right Start to cause, and
will cause, on the terms and conditions set forth in the Investment Agreement,
the shareholders of Right Start to approve the conversion feature of the
Convertible Preferred Stock and the authorization of a sufficient number of
shares of Common Stock into which all of the Convertible Preferred Stock is
convertible and all of the Warrants are exercisable.
[Remainder of Page Intentionally Left Blank] Xxxx Xxxxx and Xxxxx Xxxxxxxx
Investment Management will be obligated to perform their obligations under this
agreement (other than ii(B) above) only if Athanor has performed or
simultaneously will perform its obligations under the Investment Agreement. The
provisions with respect to voting for directors will become effective only after
Athanor has purchased and The Right Start, Inc. has sold the securities
referenced in the Investment Agreement.
/s/ Xxxx Xxxxx
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Xxxx Xxxxx
XXXXX XXXXXXXX INVESTMENT MANAGEMENT, INC.
By: /s/ Xxxxx X. Xxxxxxxxxx
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Name: Xxxxx X. Xxxxxxxxxx
Its: General Counsel & Secretary
ATHANOR HOLDINGS, LLC
By: /s/ Xxx Xxxxxxx
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Name: Xxx Xxxxxxx
Title: Manager
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Member
