Solicitation Agent Agreement

OH&S DRAFT 12/14/99


[FORM OF SOLICITATION AGENT AGREEMENT]


SOLICITATION AGENT AGREEMENT


January __, 2000


H.C. WAINWRIGHT & CO., INC., as Solicitation Agent 245 Park Avenue, 44th Floor New York, New York 10167


Ladies and Gentlemen:


Riddell Sports, Inc. (the "Company") plans to issue to holders of its common stock, par value $0.01 per share (the "Common Stock"), as of December __, 1999 (the "Record Date") rights (the "Rights") to purchase shares (the "Shares") of Common Stock and a common stock purchase warrant (the "Warrants") to purchase, if certain conditions are met, common stock from the Company of a new or existing subsidiary that conducts substantially all of the Company's Internet operations (the "Rights Offering"). The Rights Offering is being made upon the terms and subject to the conditions set forth in the Prospectus and the Subscription Certificate attached hereto as Exhibit A (collectively, the "Solicitation Documents"). The Shares and the Warrants are collectively sometimes referred to herein as the "Securities."


The Company hereby appoints H.C. Wainwright & Co., Inc. ("Wainwright") as solicitation agent (the "Solicitation Agent") in connection with the Rights Offering and authorizes the Solicitation Agent to act on its behalf in accordance with this agreement (the "Agreement") and the terms of the Solicitation Documents, which Solicitation Documents have been approved by the Company and which the Solicitation Agent is authorized to use in connection with the solicitation (the "Solicitation") to exercise the Rights. The Solicitation Agent agrees to furnish no written material to holders in connection with the Solicitation other than the Solicitation Documents.


1. Solicitation of Subscriptions.


(a) The Solicitation Agent will use its best efforts to solicit the exercise of the Rights. The Solicitation Agent shall have no liability to the Company hereunder or for any act or omission except for the gross negligence or willful misconduct of the Solicitation Agent.


(b) The Company will not use or publish any material in connection with the Solicitation, or refer to the Solicitation Agent in any such material, without first obtaining the written consent of the Solicitation Agent. The Company will promptly inform the Solicitation Agent of any events known to the Company that might require any change in the Solicitation Documents. The Company will promptly inform the Solicitation Agent of any litigation or administrative action known to the Company with respect to the Solicitation.


(c) The Company agrees to furnish to the Solicitation Agent, to the extent the same is available to the Company, the names and addresses of, and the number of shares of Common Stock held by, the registered holders and beneficial owners of the Common Stock or interests therein as of the Record Date. The Solicitation Agent will use such information only in connection with the Solicitation and will not furnish such information to any other person except in connection with the Solicitation.


2. Compensation and Expenses.


(a) The Company shall pay to Wainwright, as compensation for its services as Solicitation Agent, an advisory fee equal to three percent (3%) of the gross proceeds received by the Company upon exercise of the Rights (including, without limitaton, the exercise of rights from any standby group). Separately, Wainwright may receive, for its services as Underwriter pursuant to the Underwriting Agreement that may be executed between the parties on a separate date, certain additional compensation to be set forth therein.


(b) Whether or not any Securities are purchased pursuant to the Solicitation, the Company shall pay all expenses in connection with the Solicitation. Such expenses shall include, but not be limited to the following: the preparation, printing, duplicating, postage and mailing expenses related to the Solicitation Documents and otherwise; registrar, subscription, information and transfer agent fees; all filing fees for the Solicitation Documents; advertising costs and expenses; "road show" and information meetings and presentations; bound volumes and prospectus memorabilia costs; fees and expense of its own counsel and accountants; issue and transfer taxes, if any, and all other expenses in connection with the Solicitation. The expenses paid by the Company shall also include Wainwright's actual out-of-pocket expenses, legal fees (such legal fees not to exceed $75,000 taken together with such fees incurred in connection with the concurrent offering described in the Registration Statement (defined below)) and expenses of Wainwright's counsel and "Blue Sky" legal fees and expenses. Wainwright's counsel shall perform the required "Blue Sky" legal services for the Company's account. In this connection Blue Sky applications, to the extent required, shall be made in such states and jurisdictions as shall be requested by Wainwright.


3. Representations and Warranties of the Company.


The Company represents and warrants to the Solicitation Agent as follows:


(a) The Company is validly existing as a Delaware corporation in good standing under the laws of the State of Delaware.


(b) The Company has duly taken all necessary corporate action to authorize the making of the Solicitation and the execution, delivery and performance of this Agreement; and this Agreement has been duly executed and delivered by the Company.


(c) The Company has prepared and filed with the Securities and Exchange Commission (the "Commission") a registration statement, and amendments thereto, on Form S-1 (Registration No. 333-______________), including any related preliminary prospectus or prospectuses (each a "Preliminary Prospectus"), for the registration of the Securities, under the Securities Act of 1933, as amended (the "Securities Act"), which registration statement and


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amendment or amendments have been prepared by the Company in conformity with the requirements of the Securities Act, and the rules and regulations of the Commission under the Securities Act. The Company will not file any other amendment to such registration statement which the Underwriter shall have objected to in writing after having been furnished with a copy thereof. Except as the context may otherwise require, such registration statement, as amended, on file with the Commission at the time it becomes effective (including the prospectus, financial statements, schedules, exhibits and all other documents filed as a part thereof or incorporated therein (including, but not limited to, those documents or that information incorporated by reference therein) and all information deemed to be a part thereof as of such time pursuant to paragraph (b) of Rule 430A of the rules and regulations under the Securities Act), is hereinafter called the "Registration Statement," and the form of prospectus in the form first filed with the Commission pursuant to Rule 424(b) of the rules and regulations under the Securities Act is hereinafter called the "Prospectus." For purposes hereof, "Rules and Regulations" mean the rules and regulations adopted by the Commission under either the Act or the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as applicable


(d) Neither the Commission nor any state regulatory authority has issued any order preventing or suspending the use of any Preliminary Prospectus, the Registration Statement or the Prospectus or any part of any thereof and no proceedings for a stop order suspending the effectiveness of the Registration Statement or any of the Company's securities have been instituted or are pending or threatened. Each of the Preliminary Prospectus, the Registration Statement and the Prospectus, at the respective times of filing thereof, conformed with the requirements of the Act and the Rules and Regulations. The Solicitation Documents do not and (as amended or supplemented, if amended or supplemented) will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.


(e) The Company has a duly authorized, issued and outstanding capitalization as set forth in the Prospectus, under "Capitalization" and "Description of Securities" and will, at the time set forth therein, have the adjusted capitalization set forth therein based upon the assumptions set forth therein, and the Company is not a party to or bound by any instrument, agreement or other arrangement providing for it to issue any capital stock, rights, warrants, options or other securities, except for this Agreement as described in the Prospectus. The Securities and all other securities issued or issuable by the Company conform or, when issued and paid for, will conform, in all respects to all statements with respect thereto contained in the Registration Statement and the Prospectus. All issued and outstanding securities of the Company have been duly authorized and validly issued and are fully paid and non-assessable and the holders thereof have no rights of rescission with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities were issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. The Securities to be sold by the Company hereunder are not and will not be subject to any preemptive or other similar rights of any stockholder, have been duly authorized and, when issued, paid for and delivered in accordance with the terms hereof, will be validly issued, fully paid and non-assessable and will conform to the description thereof contained in the Prospectus; the holders thereof will not be subject to any liability solely as such holders; all corporate action required to be taken for the authorization, issue and sale of the


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Securities has been duly and validly taken; and the certificates representing the Securities will be in due and proper form.


(f) The making and consummation of the Solicitation and the execution, delivery and performance by the Compan ...