AMENDMENT TO STOCKHOLDERS AGREEMENT BY AND
BETWEEN RBCJJ ASSOCIATES, LLC AND SEL-LEB
MARKETING, INC. DATED OCTOBER 31, 1997
AS OF APRIL 12, 1999
AMENDMENT made this 12th day of April, 1999, by and between RBCJJ
ASSOCIATES, LLC ("LLC"), a New York limited liability company, with offices at
00 Xxxxxx Xxxxxx, Xxxxx Xxxxxxxxxx, Xxx Xxxx 00000, and SEL-LEB MARKETING, INC.
("SEL-LEB") with offices at 000 Xxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxxxx 00000
(hereinafter called the "Shareholders"), and ALES SIGNATURE LTD. ("ALES") with
offices at 000 Xxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxxxx 00000 (hereinafter called the
"Corporation").
WHEREAS, the Shareholders entered into a Stockholders
Agreement on the 31st day of October, 1997; and
WHEREAS, the parties to said Agreement have reviewed certain
of the financial matters concerning the acquisition of Signature
Beauty Care Corp. (hereinafter "SBC"); and
WHEREAS, the parties are now in agreement as to the
capitalization and value of the ALES no par common stock; and
WHEREAS, the parties desire to amend the October 31, 1997 Agreement
to reflect accurately their understanding of the values attributable to the
stock.
NOW, THEREFORE, in consideration of mutual promises and
other valuable considerations, the Shareholders and the Corporation agree with
each other as follows:
1. Paragraph numbered "2" of the Agreement entitled
"Contributions to Capital of the Corporation" as amended shall read
as follows:
"The Shareholders will simultaneously herewith initially commit to
fund the Corporation with such amounts as may be necessary to
purchase the Signature Beauty Care assets in accordance with the
terms of the Asset Purchase Agreement on a 90%/10% basis, with
SEL-LEB contributing 90% and LLC 10% and such further and other
amounts as may be necessary for working capital in the same ratio.
The working capital contribution shall not exceed Three Hundred
Thousand ($300,000.00) Dollars in the aggregate. The capital
contribution made by the parties on a 90%/10% basis is in the
amount of $671,796.00".
2. Paragraph numbered "7" of the Agreement entitled "Valuation of
No Par Value Common Shares" as amended shall read as follows:
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The parties acknowledge and agree that the value of the no par
common shares upon full contribution of capital as provided for in
Paragraph "2" is $6,718.00 per share and that LLC is the holder of
twenty (20) shares and that SEL-LEB is the owner of eighty (80)
shares.
3. Paragraph numbered "12" of the Agreement entitled "LLC's
Rights to Purchase Additional Stock of ALES" as amended shall read as follows:
In accordance with the terms and conditions hereinafter set forth,
LLC shall have the unqualified right to acquire from SEL-LEB an
additional twenty-nine (29) shares of no par value common stock,
which equates to a forty-nine (49%) percent ownership of the
Corporation:
(a) In the event that at any time following the execution
of this Agreement, the Corporation elects to sell or merge the
Corporation with another entity, LLC may, at its option, notify
SEL-LEB in writing of its intent to purchase twenty-nine (29)
shares of SEL-LEB's no par value common
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stock at a price of $10,077.00 per share, payable upon such terms
as may be mutually agreed; or
(b) In the event that at any time following the execution
of this Agreement, the Corporation receives a letter of intent from
an underwriter for an initial public offering, LLC may, at its
option, notify SEL-LEB in writing prior to registration with the
Securities and Exchange Commission of its intent to purchase
twenty-nine (29) shares of SEL-LEB's no par value common stock at a
price of $13,436.00 per share, payable upon such terms as may be
mutually agreed; or
(c) In the event that neither of the events described in
subparagraphs (a) and (b) above occur, at the end of a two-year
period following the date ALES first ships Signature product, LLC
may, at its option, within six months thereafter, purchase
twenty-nine (29) shares at the original price of $6,718.00 per
share, payable under such terms as may be mutually agreed. As a
condition to the purchase and simultaneously therewith, SEL-LEB
will
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cause its banking institution to release the assets of ALES which
are presently the subject of cross-collateralization pursuant to
SEL-LEB's credit agreement with the banking institution.
(i) Upon LLC exercising its option, the net worth
of the Corporation shall be determined as of the close of the
preceding quarter; and
(ii) The net worth shall be distributed to the
respective Shareholders, eighty (80%) percent to SEL-LEB and twenty
(20%) percent to LLC. In the event that there is insufficient cash
to distribute the net worth, then the available cash shall be
distributed in accordance with the percentages stated above and the
balance in the same percentages shall be entered upon the books of
the Corporation as loans by the Shareholders to the Corporation
payable with interest upon such terms as may be mutually agreed.
4. That other than the foregoing amendments contained in paragraphs
"2", "7" and "12", the Agreement of October 31, 1997 shall remain without change
and with the same force and effect as
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originally stated.
IN WITNESS WHEREOF, the Shareholders have signed this Agreement on
the day and year first above written.
RBCJJ ASSOCIATES, LLC SEL-LEB MARKETING, INC.
By: By:
----------------------- ------------------------
Xxxx Xxxxxxxxxx, Member Xxx Xxxxxx, Executive
Vice President-Finance
ALES SIGNATURE LTD.
By:
------------------------
Xxxx Xxxxxx
Chief Executive Officer/
Chairman of the Board
Attest:
-----------------------
Secretary
STATE OF NEW YORK )
) ss.:
COUNTY OF NASSAU )
On the 12th day of April, 1999, before me personally came XXXX
XXXXXXXXXX, to me known, who, being by me duly sworn, did depose and say that he
is a member of RBCJJ ASSOCIATES, LLC, a New York limited liability company
described in and which executed the foregoing instrument; that he knows the seal
of said LLC; that the seal affixed to said instrument is such LLC seal; that it
was so
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affixed by order of the board of directors of said LLC, and that he signed his
name thereto by like order.
------------------------
Notary Public
STATE OF )
) ss.:
COUNTY OF )
On the 12th day of April, 1999, before me personally came XXX
XXXXXX, to me known, who, being by me duly sworn, did depose and say that he is
the Executive Vice President-Finance of SEL-LEB MARKETING, INC., the Corporation
described in and which executed the foregoing instrument; that he knows the seal
of said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by order of the board of directors of said
corporation, and that he signed his name thereto by like order.
------------------------
Notary Public
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STATE OF )
) ss.:
COUNTY OF )
On the 12th day of April, 1999, before me personally came XXXX
XXXXXX, to me known, who, being by me duly sworn, did depose and say that he is
the Chief Executive Officer and Chairman of the Board of ALES SIGNATURE LTD.,
the Corporation described in and which executed the foregoing instrument; that
he knows the seal of said corporation; that the seal affixed to said instrument
is such corporate seal; that it was so affixed by order of the board of
directors of said corporation, and that he signed his name thereto by like
order.
------------------------
Notary Public
-------------------------
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