EXHIBIT 10.25
MODIFICATION AGREEMENT, DATED JUNE 28, 1996,
BY AND BETWEEN THE COMPANY, TERENCE F. DAVIS AND MARIE BOULE
MODIFICATION AGREEMENT
THIS MODIFICATION AGREEMENT ("Agreement") is made this 28th day of June,
1996, by and among Janex International, Inc., a Colorado corporation ("Janex
International"), Terence F. Davis ("Davis") and Marie Boule ("Boule"), with
reference to the following facts:
A. On August 4, 1995, the parties, among others, entered into an
Agreement of Purchase and Sale of Stock ("Malibu Agreement"), whereby Davis and
Boule sold to Janex International, all of the stock of Malibu Fun Stuffed and
Malibu Fun Stuffed International Limited.
B. Paragraph 1.3 of the Malibu Agreement provides for certain Contingent
consideration to be paid to Davis and Boule, in shares of Common Stock of Janex
International.
C. Due to the corporate reorganization of Janex International and its
subsidiaries, it has become difficult, if not impossible, to measure the amount
of the Contingent consideration to be received by Davis and Boule.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises of the parties set forth below, the parties agree as follows:
14. Deletion of Contingent Consideration. Paragraph 1.3 of the Malibu
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Agreement is hereby deleted in its entirety.
15. Issuance of Shares of Janex International. For and in consideration
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of the deletion of the Contingent consideration set forth in the Malibu
Agreement and in lieu of said Contingent consideration, the parties agree that
Janex International shall issue: (a) Ninety Thousand (90,000) shares of Janex
International Common Stock (restricted) to Davis; and (b) Sixty Thousand
(60,000) shares of Janex International Common Stock (restricted) to Boule.
16. Representations and Warranties Concerning Securities. As an
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inducement to Janex International to issue the shares of Janex Stock to Davis
and Boule, each of Davis and Boule represent and warrant to Janex International,
which shall be continuing representations and warranties, the following:
(a) The shares of Janex International Common Stock to be acquired by
each of them hereunder will be acquired for each such person's own account and
not with a view to or for sale in connection with any distribution of such
shares.
(b) Each of them (1) has had the opportunity to discuss Janex
International's business, management and financial affairs with its Chief
Executive Officer, and (2) has reviewed Janex International's financial
statements, 1995 Annual Report
Form 10-KSB and Quarterly Reports Form 10-QSB filed since the date of the last
Form 10-KSB, and such other documents as each of them deemed important.
(c) Each of them has the requisite financial and/or business
experience necessary to evaluate the risks and rewards of investing in the
shares of Janex International Stock and each of them is capable of protecting
himself or herself in that regard.
(d) Davis is an employee and officer of Janex Corporation, as well as
Malibu Fun Stuffed, Inc. Boule is an employee of Malibu Fun Stuffed, Inc.
(e) All solicitations, negotiations, offers and acceptances pertaining
to the transactions contemplated by this Agreement have taken place in the State
of California. No commission or other remuneration is being paid by either of
them, directly or indirectly, with respect to any solicitation of either of them
in connection with this transaction.
(f) The shares of Janex International Stock that each of them will be
acquiring have not been registered under the Securities Act of 1933, as amended
(the "Act") by reason of their issuance in a transaction exempt from the
registration and prospectus delivery requirements of the Act pursuant to Section
4(2) thereof, and that they must be held indefinitely unless a subsequent
disposition thereof is registered under the Act, or is exempt from registration.
The shares of Janex International Stock that each of them will be acquiring,
will be "restricted securities" as that term is defined in Rule 144, promulgated
under the Act; that the exemption from registration under Rule 144 will not be
available in any event for at least two (2) years from the date of issuance, and
even then will not be available unless (1) a public trading market then exists
for the Janex International Stock, (2) adequate information concerning Janex
International is then available to the public, and (3) other terms and
conditions of Rule 144 are complied with; and that any sale of the Janex
International Stock may be made by each of them only in accordance with such
terms and conditions.
(g) Each of them understands and agrees that the certificates
representing the shares of Janex International Stock to be issued to each of
them will be stamped or otherwise imprinted with a legend, which provides
substantially as follows (but may also include references to state law):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 ("THE ACT") AND ARE "RESTRICTED SECURITIES" AS
THAT TERM IS DEFINED IN RULE 144 UNDER THE ACT. THE SHARES MAY NOT BE
OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN
EFFEC-
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TIVE REGISTRATION STATEMENT UNDER THE ACT, OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED
TO THE SATISFACTION OF THE COMPANY.
17. Entire Agreement. This agreement contains a complete statement of the
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arrangements between the parties with respect to its subject matter, supersedes
any previous agreement among them relating to the subject matter hereof, and
cannot be changed or terminated orally.
18. Headings. The paragraph headings of this Agreement are for reference
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purposes only and are to be given no effect in the construction or
interpretation of this Agreement.
19. Governing Law. This agreement shall be governed by and construed in
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accordance with the law of the State of California.
20. Counterparts. This Agreement may be executed in any number of
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counterparts, which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day and
year first above written.
JANEX INTERNATIONAL, INC.
By:/s/ SHELDON F. MORICK
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Sheldon F. Morick,
Chief Executive Officer
/s/ TERENCE F. DAVIS
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Terence F. Davis, an individual
/s/ MARIE BOULE
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Marie Boule, an individual
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CONSENT OF SPOUSE
I, the undersigned, agree and certify that:
1. I am married to Terence F. Davis, who signed the foregoing
Modification Agreement ("Agreement").
2. I have read and approve the provisions of said Agreement and agree to
be bound thereby.
3. In consenting hereto, I have either been advised by an attorney of
my own choosing, or personally decided not to seek such advice.
4. This Consent and the Agreement shall be interpreted and governed under
the laws of the State of California, and venue for any suit or proceeding shall
be limited solely to a court of competent jurisdiction located in the County of
Los Angeles, State of California.
Dated: June 28, 1996.
/s/ ELYSE DAVIS
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Elyse Davis
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