EXHIBIT 10.2
SERIES III CONVERTIBLE PREFERRED STOCK
MODIFICATION AGREEMENT
THIS SERIES III CONVERTIBLE PREFERRED STOCK MODIFICATION AGREEMENT
is entered into and shall be effective as of the 29th day of December, 1998, by
and between Telident, Inc., a Minnesota corporation (the "Company"), and Special
Situations Private Equity Fund, L.P. (the "Shareholder").
WHEREAS, the Shareholder currently holds 200,000 shares (the
"Preferred Stock") of the Series III Convertible Preferred Stock of the Company;
WHEREAS, the Preferred Stock is governed pursuant to that
Certificate of Designation of Series III Convertible Preferred Stock (the
"Certificate") which was filed with the Secretary of State of the State of
Minnesota on April 14, 1998, a copy of which is attached as Exhibit A hereto;
and
WHEREAS, the Company and the Shareholder desire to enter into this
Agreement to modify the rights and preferences of the Preferred Stock set forth
in the Certificate to redress alleged damages that the Shareholder has incurred
related to the registration of the common stock of the Company for resale upon
the conversion of the Series III Convertible Preferred Stock of the Company.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto hereby agree as follows:
1. Modification to Conversion Rights.
(a) The first sentence of Article I, Section C(2) of the Certificate
is hereby deemed to include the following at the end of the
sentence:
, however, that 80% of the Average Price shall
not be more than $ .785 until such time as the
closing bid price for the shares of Common
Stock (appropriately adjusted to reflect stock
splits, stock dividends, reorganizations,
consolidations and similar changes hereafter
effected) is greater than $1.75 on any ten
(10) consecutive trading days following
receipt by Shareholder of written notification
of the initial effective date of the
registration statement which registers for
resale the shares of Common Stock issuable
upon conversion of the Series III Preferred
Stock.
(b) Shareholder agrees not to convert any shares of Series III
Convertible Preferred Stock into Common Stock pursuant to the
conversion terms set forth in Section 1(a) (as opposed to the
conversion terms that exist in the Certificate) without first having
sold to an unrelated third party the Common Stock underlying such
Convertible Preferred Stock.
2. Release and Waiver. Shareholder releases the Corporation and its
employees, advisors, officers and directors, from any and all claims
or liability related to or arising out of the fact that a
registration statement covering the Preferred Stock was not filed
with the Securities and Exchange Commission within thirty days after
the closing of the purchase of the Preferred Stock.
3. Entire Agreement. This Agreement states the entire agreement of the
parties regarding the matters herein, merges all prior negotiations,
agreements, and understandings, if any there be, and states in full
all representations, warranties and undertakings that have induced
this Agreement, there being no representations, warranties or
undertakings other than those stated herein.
4. Amendment. This Agreement may be modified or amended only in a
writing duly executed by the parties hereto.
5. Assignment. The Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and successors
and assigns of the parties.
6. Governing Law. This Agreement shall be governed by the internal laws
of the State of Minnesota.
7. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original but
all of which together shall constitute but one agreement
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8. Cooperation. The parties agree to take any additional actions
necessary to carry out the intents and purposes of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
TELIDENT, INC.
By: /s/ W. Xxxxxx XxXxxxxxxx
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W. Xxxxxx XxXxxxxxxx
Its: President and Chief Financial Officer
SPECIAL SITUATIONS PRIVATE EQUITY
FUND, L.P.
By: /s/ Xxxxx Greenhouse
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Its: Executive Vice President
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