EXHIBIT 10.11
AMENDMENT TO
SUBSCRIPTION AGREEMENT
This Amendment to Subscription Agreement (this "AMENDMENT") is made and
effective as of March 2, 2005, by and among Franklin Capital Corporation, a
Delaware corporation (the "ISSUER"), and the persons and entities listed on
EXHIBIT A attached hereto who are the Holders of a majority of the Registrable
Securities (collectively, the "AMENDING INVESTORS"). Capitalized terms used but
not defined herein shall have the meanings given to them in the Subscription
Agreement (as defined below).
RECITALS
A. The Company and the Amending Investors are parties to that certain
Subscription Agreement, dated as of November 3, 2004 (the "SUBSCRIPTION
AGREEMENT"), by and among the Company and the Investors listed therein
(including, without limitation, the Amending Investors) and desire to amend the
Subscription Agreement as set forth in this Amendment.
B. Section 9.6 of the Subscription Agreement provides that the
Subscription Agreement or any provision thereof may be amended only by a written
instrument executed by the Issuer and the Holders of a majority of the
Registrable Securities.
AMENDMENT
In consideration of the mutual covenants contained herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. AMENDMENT TO SUBSCRIPTION AGREEMENT. The Subscription Agreement is hereby
amended as follows:
1.1 Section 6.2 of the Subscription Agreement is hereby amended and
restated in its entirety to read as follows:
"6.2 REQUIRED REGISTRATION. As promptly as practicable after the
Closing, but in no event later than one hundred eighty (180) days after
the date of the Closing, the Issuer agrees to file a Registration
Statement to register the resale of all the Shares and Warrant Shares
(which shall not include an underwritten offering) (a "REQUIRED
REGISTRATION"). Not less than two (2) days prior to the filing of the
Registration Statement, the Issuer shall provide each of the Investors
(or, if an Investor shall have so instructed the Issuer, the investment
adviser of such Investor) with a copy of the Registration Statement
proposed to be filed and shall consider all (but shall not be obligated to
give effect to any) appropriate comments that are timely provided by such
Investors with respect to the Registration Statement. The Issuer shall use
its reasonable best efforts to cause the SEC to declare the Registration
Statement effective no later than the ninetieth
(90th) day following the date the Registration Statement is filed with the
SEC. In the event that the Registration Statement has not been filed on or
prior to the one hundred eightieth (180th) day after the date of the
Closing (the "REGISTRATION DEADLINE"), then in addition to any other
rights the Holders may have hereunder or under applicable law, on each
monthly anniversary of such Registration Deadline until the date on which
the Registration Statement is first filed, the Issuer shall pay to each
Holder an amount in cash, as liquidated damages and not as a penalty,
equal to 1.0% of the aggregate Purchase Price originally paid in
connection with the acquisition pursuant to the terms of this Agreement of
the Registrable Securities then held by such Holder. Once the Registration
Statement has been declared effective, the Issuer shall thereafter
maintain the effectiveness of the Registration Statement until the earlier
of: (i) the date on which all the Shares and Warrant Shares have been sold
pursuant to the Registration Statement or Rule 144; or (ii) such time as
the Issuer reasonably determines, based on the advice of counsel, that
each Holder, acting independently of all other Holders, will be eligible
to sell under Rule 144 all the Shares and Warrant Shares then owned by
such Holder within the volume limitations imposed by paragraph (e) of Rule
144 in the three (3) month period immediately following the termination of
the effectiveness of the Registration Statement. Notwithstanding the
foregoing, the Issuer's obligations contained in this SECTION 6.2 shall
terminate on the second (2nd) anniversary of the date of the Closing."
2. MISCELLANEOUS.
2.1 NO OTHER AMENDMENT. Except as expressly set forth in this Amendment,
the terms and conditions of the Subscription Agreement shall remain unchanged
and in full force and effect.
2.2 COUNTERPARTS. This Amendment may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute a
single instrument. This Amendment may be executed and transmitted via facsimile
with the same validity as if it were an executed original document.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
2
IN WITNESS WHEREOF, the parties have executed this AMENDMENT TO
SUBSCRIPTION AGREEMENT as of the date first written above.
COMPANY:
FRANKLIN CAPITAL CORPORATION
By:____________________________________
MILTON "TODD" AULT III
Chairman and Chief Executive Officer
AMENDING INVESTORS:
Name of Amending Investor:
_______________________________________
By:____________________________________
Name:__________________________________
Title:_________________________________
[SIGNATURE PAGE TO AMENDMENT TO SUBSCRIPTION AGREEMENT]
EXHIBIT A
LIST OF AMENDING INVESTORS
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AMENDING INVESTOR NUMBER OF REGISTRABLE SECURITIES HELD
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Bodnar Capital Management, LLC 281,250
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Catalysis Partners, LLC 45,000
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Charles J. Kalina III 18,750
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Jean Cosby IRA R/O 18,750
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Daniel James Heckman II 14,062
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Sothi Thillairajah 7,500
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TOTAL: 385,312
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