VOTING AND ROLLOVER AGREEMENT BETWEEN ELC HOLDINGS CORPORATION AND RONALD ELLIOTT DATED AS OF JULY 19, 2006
Execution Copy
Exhibit 99.3
BETWEEN
ELC HOLDINGS CORPORATION
AND
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
DATED AS OF JULY 19, 2006
This VOTING AND ROLLOVER AGREEMENT (this “Agreement”) is entered into as of July 19,
2006, by and between ELC Holdings Corporation, a Delaware corporation (“Parent”), and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the “Stockholder”).
W I T N E S S E T H:
WHEREAS, as of the date hereof, the Stockholder beneficially owns and is entitled to dispose
of (or to direct the disposition of) certain shares of Common Stock of (“Common Stock”) of
Excelligence Learning Corporation, a Delaware corporation (the “Company”);
WHEREAS, Parent and the Company propose to enter into an Agreement and Plan of Merger, dated
as of the date hereof, by and among the Company, ELC Acquisition Corporation, a Delaware
corporation (“Merger Sub”), and Parent (the “Merger Agreement”), pursuant to which,
subject to the terms and conditions of the Merger Agreement, Merger Sub will merge with and into
the Company with the Company being the surviving corporation; and
WHEREAS, concurrently with the execution and delivery of the Merger Agreement and as a
condition and inducement to Parent’s willingness to enter into the Merger Agreement, the
Stockholder is executing this Agreement whereby the Stockholder agrees to vote all of the
Stockholder’s Subject Common Shares (as defined below) pursuant to the terms and conditions of this
Agreement and to exchange a portion of the Subject Common Shares in shares of stock Parent.
NOW, THEREFORE, in consideration of the foregoing and the mutual promises, representations,
warranties, covenants and agreements contained herein, the parties hereto, intending to be legally
bound, hereby agree as follows:
ARTICLE I
DEFINITIONS; INTERPRETATION
DEFINITIONS; INTERPRETATION
Section 1.1 Capitalized Terms. For purposes of this Agreement, capitalized terms used
and not defined herein shall have the respective meanings ascribed to them in the Merger Agreement.
Section 1.2 Other Definition. For purposes of this Agreement,
(a) “Subject Common Shares” means, with respect to the Stockholder, the number of shares of
Common Stock set forth opposite the Stockholder’s name on Schedule I hereto, together with any
shares of Common Stock acquired by the Stockholder after the date hereof; provided,
however, that, notwithstanding anything to
the contrary in this Agreement, the Stockholder is in no way required by this Agreement to
exercise any options or warrants to purchase Common Stock.
(b) “Proxy Term” shall mean the period from the execution of this Agreement until the
termination of this Agreement in accordance with Section 7.1.
Section 1.3 Interpretation. The words “hereof,” “herein” and “hereunder” and words of
similar import when used in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement, and Section references are to this Agreement unless
otherwise specified. Whenever the words “include,” “includes” or “including” are used in this
Agreement, they shall be deemed to be followed by the words “without limitation.” The headings
contained in this Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. No provision of this Agreement shall be construed to
require Parent, the Stockholder or any of their respective Subsidiaries or Affiliates to take any
action that would violate any applicable Law.
ARTICLE II
VOTING
VOTING
Section 2.1 Agreement to Vote the Stockholder’s Subject Common Shares. During the
Proxy Term, the Stockholder agrees that at any annual, special or other meeting of the stockholders
of the Company called to vote upon the Merger and/or the Merger Agreement, and at any adjournment
or postponement thereof, and in connection with any action of the stockholders of the Company taken
by written consent to approve the Merger and approve and adopt the Merger Agreement, the
Stockholder will:
(a) appear in person or by proxy at each such meeting or otherwise cause the Stockholder’s
Subject Common Shares to be counted as present at such meeting for purposes of calculating a
quorum; and
(b) vote (or cause to be voted) all of the Stockholder’s Subject Common Shares (i) in favor of
the adoption of the Merger Agreement (including any amendments thereto) and the approval of the
Merger and the other transactions contemplated by the Merger Agreement and any actions required in
furtherance thereof and (ii) (other than the transactions contemplated by the Merger Agreement)
against any action, proposal, transaction or agreement that would reasonably be expected to (A)
result in a breach in any material respect of any covenant, representation or warranty or any other
obligation or agreement of the Company contained in the Merger Agreement or of the Stockholder
contained in this Agreement or (B) impede, interfere or be inconsistent with, delay, postpone,
discourage or adversely affect the transactions contemplated by the Merger Agreement or this
Agreement. Any such vote shall be cast or consent shall be given in accordance with such
procedures relating thereto so as to ensure that it is duly counted for purposes of determining
that a quorum is present and for purposes of recording the results of such vote or consent.
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(c) Notwithstanding any provision of this Agreement to the contrary, nothing in this Agreement
shall limit or restrict the Stockholder or any of his Representatives or Affiliates from acting in
such Person’s capacity as an officer or director of the Company (it being understood that this
Agreement shall apply to the Stockholder solely in the Stockholder’s capacity as a stockholder of
the Company) or voting in the Stockholder’s sole discretion on any matter other than those matters
referred to in subsection (b) above.
Section 2.2 Grant of Irrevocable Proxy. If requested by Parent, the Stockholder will
constitute and appoint Parent, or any nominee of Parent, or will cause Parent, or any nominee of
Parent, to be constituted or appointed, with full power of substitution and re-substitution, during
and for the Proxy Term, as the Stockholder’s true and lawful attorney in fact and irrevocable
proxy, for and in the Stockholder’s name, place and stead, to vote each of the Subject Common
Shares as the Stockholder’s proxy, at any annual, special or other meeting of the stockholders of
the Company called to vote upon the Merger and/or the Merger Agreement, and at any adjournment or
postponement thereof, and in connection with any action of the stockholders of the Company, taken
by written consent to approve the Merger and approve and adopt the Merger Agreement, or, as
applicable, to instruct and direct the Depository Trust & Clearing Corporation or any other holder
of record of such Subject Common Shares to vote such Subject Common Shares at any annual, special
or other meeting of the stockholders of the Company called to vote upon the Merger and/or the
Merger Agreement, and at any adjournment or postponement thereof, and in connection with any action
of the stockholders of the Company taken by written consent to approve the Merger and approve and
adopt the Merger Agreement, (i) in favor of the adoption of the Merger Agreement (including any
amendments thereto) and the approval of the Merger and the other transactions contemplated by the
Merger Agreement and any actions required in furtherance thereof and (ii) (other than as otherwise
contemplated by the Merger Agreement) against any action, proposal, transaction or agreement that
would reasonably be expected to (A) result in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement of the Company contained in the
Merger Agreement or (B) impede, interfere or be inconsistent with, delay, postpone, discourage or
adversely affect the transactions contemplated by the Merger Agreement or this Agreement.
Section 2.3 Nature of Irrevocable Proxy. ANY PROXY AND POWER OF ATTORNEY GRANTED
PURSUANT TO SECTION 2.2 BY THE STOCKHOLDER SHALL BE IRREVOCABLE DURING THE PROXY TERM, SHALL BE
DEEMED TO BE COUPLED WITH AN INTEREST SUFFICIENT IN LAW TO SUPPORT AN IRREVOCABLE PROXY AND SHALL
REVOKE ANY AND ALL PRIOR PROXIES GRANTED BY THE STOCKHOLDER. Any power of attorney granted by the
Stockholder pursuant to Section 2.2 shall be a durable power of attorney and shall survive the
dissolution, bankruptcy, death or incapacity of the Stockholder and any obligation of the
Stockholder under this Agreement and shall be binding upon the heirs, personal representatives,
successors and assigns of the Stockholder. The Stockholder hereby revokes all other proxies and
powers of attorney with respect to all of the Stockholder’s Subject Common Shares that may have
heretofore been appointed or granted to the extent that they conflict with the proxy and power of
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attorney granted herein, and, except as expressly contemplated by this Agreement, no subsequent
proxy or power of attorney shall be given (and if given, shall not be effective) by the Stockholder
with respect to any annual, special or other meeting of the stockholders of the Company called to
vote upon the Merger and/or the Merger Agreement, and at any adjournment or postponement thereof,
and in connection with any action of the stockholders of the Company taken by written consent to
approve the Merger and approve and adopt the Merger Agreement.
ARTICLE III
COVENANTS
COVENANTS
Section 3.1 Generally.
(a) The Stockholder agrees that, except as expressly contemplated by the terms of this
Agreement or the Merger Agreement, the Stockholder shall not (i) sell, transfer, tender, pledge,
give, encumber, assign, convert into another class of securities of the Company or otherwise
dispose of (collectively, a “Transfer”) or enter into any contract, option or other
agreement with respect to, or consent to, a Transfer of or grant a proxy or power of attorney,
deposit into any voting trust, enter into any voting agreement, or create or permit to exist any
Liens of any nature whatsoever with respect to, any or all of the Stockholder’s Subject Common
Shares or (ii) take any action that would reasonably be expected to have the effect of preventing,
impeding or materially and adversely affecting the Stockholder’s ability to perform the
Stockholder’s obligations under this Agreement. Notwithstanding the foregoing, the Stockholder may
make Transfers (A) by will or by operation of law, in which case this Agreement shall bind the
transferee, (B) to any other Person who shall have executed a counterpart or otherwise become party
to this Agreement (whether by joinder, an accession agreement, an amendment to this Agreement or
otherwise) and who is legally bound by the terms hereof and/or (C) as Parent may otherwise consent
in writing in its sole discretion (such consent not to be unreasonably withheld).
(b) The Stockholder agrees not to take any action that would reasonably be expected to (i)
make any representation or warranty of the Stockholder contained herein untrue or incorrect in any
material respect or (ii) have the effect of preventing or disabling the Stockholder from performing
the Stockholder’s obligations under this Agreement.
(c) In the event of a stock dividend or distribution, or any change in the Common Stock by
reason of any stock dividend or distribution, split-up, recapitalization, combination, exchange of
shares or the like, the term “Subject Common Shares”, when used with respect to the
Stockholder, shall be deemed to refer to and include the Stockholder’s then-existing Subject Common
Shares as well as all such stock dividends and distributions and any securities into which or for
which any or all of the Stockholder’s Subject Common Shares may be changed or exchanged or which
are received in such transaction.
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Section 3.2 Standstill Obligations of the Stockholder. The Stockholder covenants and
agrees with Parent that, during the Proxy Term:
(a) The Stockholder shall not, nor shall the Stockholder permit any Affiliate of the
Stockholder to, nor shall the Stockholder act in concert with or permit any Affiliate to act in
concert with any Person to make, or in any manner participate in, directly or indirectly, a
“solicitation” of “proxies” (as such terms are used in the rules of the SEC) or ▇▇▇▇▇ ▇▇▇▇▇▇ of
attorney or similar rights to vote, or seek to advise or influence any Person with respect to the
voting of, any shares of Common Stock in connection with any vote or other action on any matter, in
each case in a manner that would be inconsistent with the Stockholder’s obligations under this
Agreement (including without limitation, Article II hereof), other than to recommend that the
stockholders of the Company vote in favor of the Merger and the Merger Agreement.
(b) The Stockholder shall not, nor shall the Stockholder authorize any Affiliate of the
Stockholder to, nor shall the Stockholder act in concert with or permit any Affiliate to act in
concert with any Person to, deposit any shares of Common Stock in a voting trust or subject any
shares of Common Stock to any arrangement or agreement with any Person with respect to the voting
of such shares of Common Stock, in each case in a manner that would be inconsistent with the
Stockholder’s obligations under this Agreement (including without limitation, Article II hereof).
(c) The Stockholder shall not and shall cause its Affiliates and Representatives not to,
directly or indirectly, (i) initiate, solicit, induce or encourage, or take any action to
facilitate the making of, any inquiry, offer or proposal which constitutes, or could reasonably be
expected to lead to, an Acquisition Proposal; (ii) participate in any discussions or negotiations
regarding any Acquisition Proposal or furnish, or otherwise afford access, to any Person (other
than Parent and Merger Sub and their Representatives and lenders) any information or data with
respect to the Company or any of its Subsidiaries or otherwise relating to an Acquisition Proposal;
or (iii) enter into any agreement, agreement in principle or letter of intent with respect to any
Acquisition Proposal or approve or resolve to approve any Acquisition Proposal or any agreement,
agreement in principle or letter of intent relating to an Acquisition Proposal. Any violation of
the foregoing restrictions by any of the Representatives, whether or not such Representative is so
authorized and whether or not such Representative is purporting to act on behalf of the Stockholder
or otherwise, shall be deemed to be a breach of this Agreement by the Stockholder. The Stockholder
shall, and shall cause each of its Affiliates and Representatives to, immediately cease and cause
to be terminated all existing discussions, negotiations, and communications with any Persons with
respect to any existing or potential Acquisition Proposal.
(d) The Stockholder shall promptly (and in any event within twenty-four (24) hours) notify
Parent and Merger Sub in writing if any proposals or offers are received by, any information is
requested from, or any negotiations or discussions are sought to be initiated or continued with,
the Company or its Representatives, in each case in connection with any Acquisition Proposal or the
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possibility or consideration of making an Acquisition Proposal, and such notice shall indicate
the name of the Person initiating such discussions or negotiations or making such proposal, offer
or information request and the material terms and conditions of any proposals or offers (and, in
connection therewith, shall simultaneously provide to Parent copies of any written materials
(including e-mails or other electronic communications) received from or on behalf of such Person
relating to such proposal, offer, information request, negotiations or discussions).
(e) Notwithstanding any of the provisions of this Agreement, the Stockholder makes no
agreement or understanding herein as a director or officer of the Company. The Stockholder signs
this Agreement solely in the Stockholder’s capacity as a beneficial owner of the Stockholder’s
Subject Common Shares, and nothing herein shall limit or affect any action or inaction taken in the
Stockholder’s capacity as an officer or director of the Company.
Section 3.3 Exercise of Options. The Stockholder may (but is not hereby obligated to)
purchase or acquire any additional shares of Common Stock pursuant to the exercise of Company Stock
Options; provided, however, that any such shares of Common Stock received by the
Stockholder in respect thereof shall be deemed “Subject Common Shares” respectively for all
purposes of this Agreement without any action by any Person. Schedule II attached hereto sets
forth a list of all outstanding Company Stock Options held by the Stockholder, the vesting schedule
for each and the expiration or similar dates thereof.
Section 3.4 Public Disclosure. The Stockholder shall not issue or cause the
publication of any press release or other public announcement (to the extent not previously issued
or made in accordance with the Merger Agreement) with respect to this Agreement, the Merger
Agreement, the Merger or the other transactions contemplated by the Merger Agreement without the
prior consent of Parent.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER
The Stockholder hereby represents and warrants to Parent as follows:
Section 4.1 Authority. (a) The Stockholder has all necessary legal capacity, power
and authority to execute and deliver this Agreement and to consummate the transactions contemplated
hereby, (b) the execution and delivery of this Agreement by the Stockholder and the consummation by
the Stockholder of the transactions to be consummated by it as contemplated hereby have been duly
and validly authorized by the Stockholder, and no other proceedings on the part of the Stockholder
are necessary to authorize the execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby, and (c) this Agreement has been duly and validly executed and
delivered by the Stockholder and, assuming the due authorization, execution and delivery by Parent,
constitutes a valid and binding obligation of the Stockholder, enforceable against the Stockholder
in accordance with its terms, subject to the Bankruptcy Exceptions.
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Section 4.2 Ownership of Shares. As of the date hereof, the Stockholder is the lawful
record and/or beneficial owner of the shares of Common Stock denoted as being owned beneficially
and/or of record by the Stockholder on Schedule I and has the sole power to vote (or cause to be
voted) the Stockholder’s shares of Common Stock in accordance with the provisions of this Agreement
and the sole power of disposition with respect to such shares, with no restrictions, subject to
applicable federal securities laws. The Stockholder has good and valid title to the Common Stock
denoted as being owned by the Stockholder on Schedule I, free and clear of any Liens that would
adversely affect the ability of the Stockholder to carry out the terms of this Agreement. The
Stockholder has not appointed or granted any proxy which is still in effect with respect to any of
the Stockholder’s Subject Common Shares that will conflict with the proxy granted herein.
Section 4.3 Consents and Approvals. The execution and delivery of this Agreement by
the Stockholder does not, and the performance by the Stockholder of the Stockholder’s obligations
under this Agreement will not, require the Stockholder to obtain any consent, approval,
authorization or permit of, or to make any filing with or notification to, any Governmental
Authority based on the Law of any applicable Governmental Authority, except for (a) any filing(s)
(including amendments) that the Stockholder may be required to make pursuant to any applicable
provision of the Exchange Act and (b) such consents, approvals, authorizations or permits of,
filings with or notifications to any Governmental Authority that would not reasonably be expected
to adversely affect the ability of the Stockholder to carry out the terms of this Agreement.
Section 4.4 No Conflicts. Neither the execution and delivery of this Agreement by the
Stockholder, the consummation by the Stockholder of the transactions contemplated hereby nor
compliance by the Stockholder with any of the provisions hereof shall (a) result in, or give rise
to, a violation or breach of or a default (or an event that with notice or lapse of time or both
would become a default) under any of the terms of any contract, understanding, agreement or other
instrument or obligation to which any of the Stockholder’s Subject Common Shares or assets may be
bound or affected or (b) conflict with or violate any applicable Governmental Order or Law
applicable to the Stockholder, except in the case of clauses (a) and (b) for any such violations,
conflicts, breaches or defaults that would not reasonably be expected to adversely affect the
ability of such Stockholder to carry out the terms of this Agreement.
Section 4.5 Reliance by Parent. The Stockholder understands and acknowledges that
Parent is entering into the Merger Agreement in reliance upon the execution and delivery of this
Agreement by the Stockholder.
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT
Parent hereby represents and warrants to the Stockholder as follow:
Section 5.1 Authority. (a) Parent has all requisite corporate power and authority to
execute and deliver this Agreement and to consummate the transactions contemplated hereby, (b) the
execution and delivery of this Agreement by Parent and the consummation by Parent of the
transactions to be consummated by it as contemplated hereby have been duly and validly authorized
by Parent, and no other proceedings on the part of Parent are necessary to authorize the execution
and delivery of this Agreement or the consummation of the transactions contemplated hereby, and
(iii) this Agreement has been duly and validly executed and delivered by Parent and, assuming the
due authorization, execution and delivery by the Stockholder, constitutes a valid and binding
obligation of Parent, enforceable against Parent in accordance with its terms, subject to the
Bankruptcy Exceptions.
Section 5.2 Consents and Approvals. The execution and delivery of this Agreement by
Parent does not, and the performance by Parent of Parent’s obligations under this Agreement will
not, require Parent to obtain any consent, approval, authorization or permit of, or to make any
filing with or notification to, any Governmental Authority based on the Law of any applicable
Governmental Authority, except for (a) any filing(s) (including amendments) that Parent may be
required to make pursuant to any applicable provision of the Exchange Act and (b) such consents,
approvals, authorizations or permits of, filings with or notifications to any Governmental
Authority that would not reasonably be expected to adversely affect the ability of Parent to carry
out the terms of this Agreement.
Section 5.3 No Conflicts. Neither the execution and delivery of this Agreement by
Parent, the consummation by Parent of the transactions contemplated hereby nor compliance by Parent
with any of the provisions hereof shall (a) conflict with or violate the certificate of
incorporation or by-laws of Parent, (b) result in, or give rise to, a violation or breach of or a
default (or an event that with notice or lapse of time or both would become a default) under any of
the terms of any contract, understanding, agreement or other instrument or obligation to which
Parent is a party or by which Parent or any of Parent’s assets may be bound or affected or (c)
conflict with or violate any applicable Governmental Order or Law applicable to Parent, except in
the case of clauses (b) and (c) for any such violations, conflicts, breaches or defaults that would
not reasonably be expected to adversely affect the ability of Parent to carry out the terms of this
Agreement.
Section 5.4 Reliance by the Stockholder. Parent understands and acknowledges that the
Stockholder is entering into this Agreement in reliance upon, and agrees that the Stockholder is
entitled to rely upon, the execution, delivery and performance of the Merger Agreement by Parent
and Merger Sub.
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ARTICLE VI
ROLLOVER
ROLLOVER
Section 6.1 Rollover. Immediately prior to the Effective Time, the Stockholder agrees
to exchange seventy percent (70%) of his Subject Common Shares
(929,811 shares) for shares of
preferred and common stock of Parent (the “Rollover Shares”) in the same relative
proportion and based on the same per share value as the other stockholders of Parent acquiring both
the preferred and common stock in Parent immediately prior to the Effective Time. This rollover
transaction, together with certain contributions to Parent made in connection with the Merger, is
intended to come within the provisions of Section 351 of the Internal Revenue Code of 1986, as
amended.
Section 6.2 Equity Agreements. As a condition of Parent to effect the rollover
transaction contemplated in Section 6.1 and simultaneously with the issuance of the Rollover
Shares, the Stockholder agrees to enter into customary equity agreements in relation to the
Stockholder’s investment in the Parent including but not limited to an Equity Purchase Agreement,
Stockholders Agreement (which shall include among other things provisions relating to Board
composition, company reporting requirements, majority shareholder approval rights and pre-emptive
rights, restrictions on transfer of shares and tag-along and drag-along provisions) and a
Registration Rights Agreement.
ARTICLE VII
TERMINATION
TERMINATION
Section 7.1 Termination. This Agreement shall terminate, and neither the Parent nor
the Stockholder shall have any further rights or obligations hereunder, upon the earliest to occur
of (a) the mutual consent of Parent and the Stockholder, (b) the Effective Time and (c) the
termination of the Merger Agreement in accordance with its terms. Notwithstanding the foregoing,
this Section 7.1 and Article VIII of this Agreement shall survive the termination of this
Agreement.
ARTICLE VIII
MISCELLANEOUS
MISCELLANEOUS
Section 8.1 Appraisal Rights. The Stockholder hereby irrevocably and unconditionally
waives, and agrees to prevent the exercise of, any rights of appraisal, any dissenters’ rights and
any similar rights relating to the Merger or any related transaction that the Stockholder may
directly or indirectly have by virtue of the ownership of any Subject Common Shares.
Section 8.2 Publication. The Stockholder hereby permits Parent to publish and
disclose in any document and/or schedule filed by Parent or any of its Affiliates with the SEC the
Stockholder’s identity and ownership of shares of Common Stock and Company Stock Options and the
nature of the Stockholder’s commitments, arrangements and understandings pursuant to this
Agreement; subject to Parent
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(i) providing the Stockholder with a reasonable opportunity to review any such document and/or
schedule and (ii) accepting any comments or corrections reasonably suggested by the Stockholder to
any such document and/or schedule that are provided no later than three (3) Business Days after the
Stockholder’s receipt thereof .
Section 8.3 Further Actions. The Stockholder agrees that it will, upon the request of
Parent, execute and deliver such documents (the form and content of which to be reasonably
acceptable to the Stockholder) and take such actions as may be reasonably requested by Parent to
effectuate the purpose of this Agreement.
Section 8.4 Amendments, Waivers, etc. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified, except upon the execution and delivery of a written
agreement executed by each of the parties hereto. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in respect hereof at
law or in equity, or to insist upon compliance by any other party hereto with its obligations
hereunder, and any custom or practice of the parties at variance with the terms hereof shall not
constitute a waiver by such party of its right to exercise any such or other right, power or remedy
or to demand such compliance.
Section 8.5 Specific Performance. The parties hereto agree that if for any reason any
party hereto shall have failed to perform the Stockholder’s obligations under this Agreement, then
the party seeking to enforce this Agreement against such non-performing party shall be entitled to
specific performance and injunctive and other equitable relief. This provision is without
prejudice to any other rights or remedies, whether at law or in equity, that any party hereto may
have against any other party hereto for any failure to perform the Stockholder’s obligations under
this Agreement.
Section 8.6 Notices. All notices or other communications hereunder shall be deemed to
have been duly given and made if in writing and if served by personal delivery upon the party for
whom it is intended, if delivered by registered or certified mail, return receipt requested, or by
a national courier service, or if sent by facsimile or by e-mail transmission, in each case as set
forth below. Any such notice shall be deemed delivered (a) on the date delivered if by personal
delivery, (b) on the date upon which the return receipt is signed or delivery is refused or the
notice is designated by the postal authorities as not deliverable, as the case may be, if mailed by
registered or certified mail, (c) on the next succeeding Business Day if sent by national courier
service, or (d) on the date sent by facsimile if the appropriate facsimile confirmation is received
by the sender or (e) on the date sent if by e-mail.
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| If to Parent, addressed to it at: | ||||||
| ELC Holdings Corporation | ||||||
| c/o ▇▇▇▇▇ ▇▇▇▇▇▇▇ Equity Partners, Inc. | ||||||
| 9200 Sears Tower | ||||||
| ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ | ||||||
| ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ | ||||||
| Attention: | ▇▇▇▇ ▇. ▇▇▇▇▇, Managing Partner | |||||
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| with a copy to: | ||||||
| ▇▇▇▇▇▇▇ Procter LLP | ||||||
| ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇., ▇.▇. | ||||||
| ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||||
| Attention: | ▇. ▇▇▇▇▇ ▇▇▇▇, Esq. | |||||
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| and | ||||||
| ▇▇▇▇▇▇▇ Procter LLP | ||||||
| ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ | ||||||
| ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||||
| Attention: | ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq. | |||||
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| If to the Stockholder, addressed to him at: | ||||||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||||||
| ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ | ||||||
| ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||||
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| with a copy to: | ||||||
| ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq. | ||||||
| ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ | ||||||
| ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | ||||||
| Telephone: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
| Facsimile: | (▇▇▇) ▇▇▇-▇▇▇▇ | |||||
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Section 8.7 Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of this Agreement.
Section 8.8 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any applicable Law or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full force and effect so
long as the economic or legal substance of the transactions contemplated hereby is not affected in
any manner materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the parties as closely
as possible in an acceptable manner to the end that transactions contemplated hereby are fulfilled
to the extent possible.
Section 8.9 Entire Agreement. This Agreement (together with the Merger Agreement, to
the extent referred to herein) constitutes the entire agreement of the parties and supersedes all
prior agreements and undertakings, both written and oral, between the parties, or any of them, with
respect to the subject matter hereof.
Section 8.10 Assignment. This Agreement shall not be assigned by operation of law or
otherwise without the prior written consent of each of the parties, except that Parent may assign
and transfer its rights and obligations hereunder to any direct or indirect wholly owned subsidiary
of Parent.
Section 8.11 Parties in Interest. This Agreement shall be binding upon and inure
solely to the benefit of each party hereto and their respective successors and assigns, and nothing
in this Agreement, express or implied, is intended to or shall confer upon any other Person any
right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
Section 8.12 Governing Law; Consent to Jurisdiction; Waiver of Trial by Jury.
(a) This Agreement and the transactions contemplated hereby, and all disputes between the
parties under or related to the Agreement or the facts and circumstances leading to its execution,
whether in contract, tort or otherwise, shall be governed by and construed in accordance with the
Laws of the State of Delaware, without regard to the application of Delaware principles of
conflicts of laws.
(b) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and
its property, to the non-exclusive jurisdiction of any Delaware or California state court, or
federal court of the United States of America, sitting in Delaware or California, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Agreement or
the agreements delivered in connection herewith or the transactions contemplated hereby or thereby
or for recognition or enforcement of any judgment relating thereto, and each of the parties hereby
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irrevocably and unconditionally (i) agrees that any claim in respect of any such action or
proceeding may be heard and determined in any such Delaware or California state court or, to the
extent permitted by applicable Law, in any such federal court, (ii) waives, to the fullest extent
it may legally and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any such action or proceeding in any such Delaware or California state or
federal court, and (iii) waives, to the fullest extent permitted by applicable Law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in any such Delaware or
California state or federal court. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on
the judgment or in any other manner provided by applicable Law. Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices in Section 8.6.
Nothing in this Agreement shall affect the right of any party to this Agreement to serve process in
any other manner permitted by applicable Law.
(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS
AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE
AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE EITHER OF SUCH WAIVERS, (II) IT UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF SUCH WAIVERS, (III) IT MAKES SUCH WAIVERS VOLUNTARILY, AND (IV) IT HAS BEEN INDUCED
TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 8.12(c).
Section 8.13 Counterparts. This Agreement may be executed in two or more
counterparts, including facsimile counterparts, each of which when executed shall be deemed to be
an original but all of which taken together shall constitute one and the same agreement.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, Parent and the Stockholder have caused this Agreement to be duly executed
as of the day and year first above written.
| PARENT | ||||||
| ELC HOLDINGS CORPORATION | ||||||
| By: | /s/ ▇▇▇▇ ▇. ▇▇▇▇▇ | |||||
| Name: ▇▇▇▇ ▇. ▇▇▇▇▇ | ||||||
| Title: President | ||||||
| STOCKHOLDER | ||||||
| /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||||||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | ||||||
[Signature Page to Voting and Rollover Agreement]
Schedule I
Beneficial and Record Ownership of Common Stock
Beneficial and Record Ownership of Common Stock
| Number of Shares | Number of Shares | |||
| of Common Stock | of Common Stock | |||
| Name of Stockholder | Held Beneficially | Held of Record | ||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | 1,328,301 | 1,328,301 | ||
Schedule II
Stock Options
Stock Options
| Number of | ||||
| Outstanding | ||||
| Stock | ||||
| Name of Stockholder | Options | Vesting Date(s) | ||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | 180,000 | Fully Vested | ||
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