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EXHIBIT 10.31
AMENDED AND RESTATED RELEASE AND REDEMPTION AGREEMENT
This AMENDED AND RESTATED RELEASE AND REDEMPTION AGREEMENT (this
"Agreement") is made and entered into as of this ____ day of October, 1997, by
and between 800 TRAVEL SYSTEMS, INC., a Delaware corporation with an address at
Xxxxx 000, 0000 Xxxx Xxxxxxx, Xxxxx, Xxxxxxx 00000 (the "Company"), and XXXXXXX
XXXXXX, an individual with an address at 0000 Xxxxx Xxxxx Xxxxxxxxx, Xxxxxxxxx,
Xxxxxxx 00000 (the "Shareholder").
R E C I T A L S
WHEREAS, the Shareholder is currently the beneficial and record holder
of 481,609 shares (the "Shares") of the Company's common stock, par value $.01
per share (the "Common Stock");
WHEREAS, the Company is contemplating a public offering of shares of
the Common Stock (the "IPO");
WHEREAS, the Company and the Shareholder entered into a Release and
Redemption Agreement dated as of September 4, 1997 (the "Amended Agreement"),
which amended and superseded a Stock Redemption Agreement by and between the
parties dated as of July 18, 1997 (the "Original Agreement") and, among other
things, resolved the then existing dispute between the parties regarding the
Shareholder's claim that he would be entitled to receive additional shares of
Common Stock upon completion of the IPO;
WHEREAS, the Company and the Shareholder mutually desire to amend and
restate the Amended Agreement in its entirety.
NOW, THEREFORE, in consideration of the premises and of the mutual
promises and other good and valuable considerations hereinafter contained, the
parties hereto agree to amend and restate the Amended Agreement in its entirety
upon the following terms and conditions:
1. No Redemption. Notwithstanding anything to the contrary set
forth in the Amended Agreement (or in the Original Agreement), the Company
shall not be obligated to redeem, at the present time or at any time hereafter,
any shares of Common Stock from the Shareholder.
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2. Registration of the Shares. In connection with the IPO, the
Company shall cause the Shares to be registered for sale pursuant to the
Registration Statement which has been filed by the Company in connection with
the IPO; and only if NASDAQ refuses to list the Company's securities because of
such registration will the Company be permitted not to register the Shares. If
the Shares are not registered in connection with the IPO as a result of
NASDAQ's decision, the Company will use its best efforts and will direct its
counsel to use its best efforts to ensure that Shareholder is able to sell the
Shares pursuant to Rule 144 and pursuant to paragraph 3 hereof.
3. Lock-up of the Shares. The Shareholder agrees that he will
not, directly or indirectly, offer to sell, sell, grant an option for the sale
of, assign, transfer, pledge, hypothecate or otherwise encumber or dispose of,
or dispose of any beneficial interest in (collectively, "Sell"), any of the
Shares from the date hereof until ninety (90) days after the closing of the
IPO, including pursuant to Rule 144 under the Securities Act of 1933, as
amended. Thereafter, the Shareholder shall be permitted to Sell up to
twenty-five percent (25%) of the Shares during each 3-month period following
the IPO (with unsold amounts being carried forward to future periods). For
example: if Shareholder does not sell any Shares in the first available
quarter, he will be able to sell all or any part of the Shares he was allowed
to sell in the first available quarter in any subsequent quarter(s). The
Shareholder can be released from the foregoing lock-up at any time at the
discretion of the Representative of the Underwriters of the IPO.
4. Representation and Warranties.
(a) The Company represents and warrants to the
Shareholder that:
(i) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware;
(ii) The Company has full corporate power and
authority and has taken all corporate action necessary to authorize, execute
and deliver this Agreement and to consummate the transaction contemplated
hereby; and this Agreement has been duly executed and delivered by the Company
and is a valid and binding obligation of the Company enforceable in accordance
with its terms, except as may be limited by bankruptcy, insolvency, moratorium
and similar laws affecting the enforcement of creditors' rights generally and
subject to the qualification that the availability of equitable remedies is
subject to the discretion of the court before which any proceeding therefor may
be brought; and
(iii) Neither the execution and delivery of this
Agreement, nor the consummation of the transaction contemplated hereby, does or
will violate any provision of the Company's Certificate of Incorporation or By-
laws, or violate or result in the breach of any agreement or any federal or
state law, rule, regulation, judgment, decree or order of any governmental
authority or court to which the Company is subject or by which it is bound.
(b) The Shareholder represents and warrants to the
Company that:
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(i) Neither the execution and delivery of this
Agreement nor the consummation of the transaction contemplated hereby does or
will violate or result in the breach of any agreement or any federal or state
law, rule, regulation, judgment, order or decree of any governmental authority
or court to which the Shareholder is subject or by which he is bound;
(ii) This Agreement has been duly executed and
delivered by the Shareholder and is a valid and binding obligation of the
Shareholder enforceable in accordance with its terms, except as may be limited
by bankruptcy, insolvency, moratorium and similar laws affecting the
enforcement of creditors' rights generally and subject to the qualification
that the availability of equitable remedies is subject to the discretion of the
court before which any proceeding therefor may be brought.
5. Termination. Anything contained in this Agreement to the
contrary notwithstanding, in the event the IPO has not been consummated and
closed on or before March 31, 1998, then either party may, upon not less than
two (2) weeks' prior written notice, terminate this Agreement.
6. Notices. Any notice given or required to be given pursuant to
this Agreement shall be in writing and shall be deemed given three (3) days
after being deposited in the U.S. Mail, by postage prepaid certified mail,
return- receipt requested, addressed to the parties at the respective address
first above written or such other address as may be established by written
notice given in accordance with the provisions of this paragraph 6, with copies
if to Shareholder, to:
Singer & Xxxxxxxx LLP
00 Xxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
and to:
Xxxxxx Xxxxxx, Esq.
x/x xxx Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxxx
Xxxxx 0
0000 Xxxxx 00 Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
and, if to the Company, to:
Xxxxxxxx Xxxxx Xxxxxxxx Xxxx & Ballon LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. XxXxxx, Esq.
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7. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the
entire agreement of the parties with respect to the subject matter hereof,
supersedes all prior such agreements whether written or oral, and may not be
amended or otherwise modified except by a subsequent written instrument duly
executed by the parties hereto. Without limiting the generality of the
foregoing this Agreement supersedes the Amended Agreement and the Original
Agreement. In addition, the letter agreement dated July 22, 1997 by and among
the Company, the Shareholder and Xxxx Xxxxx is hereby declared null and void
and of no further force or effect, the provisions thereof being no longer
relevant to the transactions being entered into between the parties hereto.
(b) No Waiver. No delay or failure by either party to
exercise any right hereunder, and no partial or single exercise of any such
right, shall constitute a waiver of that right or any other right, unless
expressly waived in writing.
(c) Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of New York, without
giving effect to the conflict of laws provisions thereof.
(d) Binding Effect. The provisions of this Agreement
shall be binding upon and shall inure to the benefit of the parties and their
respective successors, representatives and assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
800 TRAVEL SYSTEMS, INC.
By:
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XXXXXXX XXXXXX
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