Amendment No. 1 To Formation Agreement

Exhibit 10.2


AMENDMENT NO. 1 dated the 24th day of July, 1995 to the Formation Agreement dated January 10, 1994 by and between INSO Corporation (formerly InfoSoft International, Inc.), a Delaware corporation ("INSO"), and Houghton Mifflin Company, a Massachusetts corporation ("HMCo").


WHEREAS, INSO and HMCo are parties to an agreement dated January 10, 1994 (the "Formation Agreement") whereby HMCo transferred to INSO certain assets used by its Software Division in exchange for shares of INSO's Series A Convertible Preferred Stock;


WHEREAS, the Formation Agreement provided, among other things, for registration rights with respect to the Common Stock of INSO which HMCo would receive upon conversion of the Series A Convertible Preferred Stock;


WHEREAS, HMCo has exercised certain of its registration rights in connection with an offering of exchangeable notes and any related transactions entered into in connection therewith (the "SAILS Offering"); and


WHEREAS, the parties now wish to amend the registration rights contained in the Formation Agreement in certain respects;


NOW, THEREFORE, the parties hereby agree as follows:


1. All defined terms used herein without definition shall have the meanings ascribed to them in the Formation Agreement.


2. Subsections (a) and (b) of Section 3 of the Formation Agreement are hereby deleted in their entirety and replaced with the following:


"Section 3. Registration Rights.
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(a) OPTIONAL REGISTRATIONS. If at any time or times during the three-year period commencing on the third anniversary of the consummation of the SAILS Offering, INSO shall determine to register any of its Common Stock or securities convertible into or exchangeable or exercisable for Common Stock under the Securities Act of 1933, as amended (the " Securities Act") (whether in connection with a public offering of securities by INSO (a "primary offering"), a public offering thereof by stockholders (a "secondary offering"), or both, but not in connection with a registration effected on form S-8 or Form S-4 (or any successor forms) under the Securities Act ), INSO will promptly give written notice thereof to HMCo, and will use its best efforts to effect the registration under the Securities Act of all shares of Common Stock which HMCo may request in a


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writing delivered to INSO within fifteen (15) days after the notice given
by INSO; PROVIDED, HOWEVER, that in the case of the registration of Common
Stock by INSO in connection with an underwritten public offering, it shall
not be required to register Registrable Securities of HMCo in excess of the
amount, if any, of Common Stock which the principal underwriter of an
underwritten offering shall reasonably and in good faith agree in writing
to include in such offering. If INSO includes in such a registration any
securities to be offered by it, all expenses of registration and offering
shall be borne by INSO, except that HMCo shall bear the reasonable fees and
expenses of its independent counsel, underwriting commissions attributable
to its shares of Common Stock being registered and transfer taxes on shares
being sold by HMCo. If the registration under this Section 3(a) is
exclusively a secondary offering, as defined in this Section 3(a), HMCo
shall bear its proportionate share of the expenses of the registration and
offering, except expenses which INSO would have incurred whether or ...