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Exhibit 4.02
QUOKKA SPORTS, INC.
AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
AS OF DECEMBER 23, 1998
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TABLE OF CONTENTS
PAGE
Section 1. GENERAL.......................................................................1
1.1 Definitions...................................................................1
Section 2. REGISTRATION; RESTRICTIONS ON TRANSFER........................................3
2.1 Restrictions on Transfer......................................................3
2.2 Demand Registration...........................................................5
2.3 Piggyback Registrations.......................................................6
2.4 Form S-3 Registration.........................................................7
2.5 Expenses of Registration......................................................8
2.6 Obligations of the Company....................................................8
2.7 Termination of Registration Rights...........................................10
2.8 Delay of Registration; Furnishing Information................................10
2.9 Indemnification..............................................................10
2.10 Assignment of Registration Rights............................................12
2.11 Amendment of Registration Rights.............................................12
2.12 Limitation on Subsequent Registration Rights.................................12
2.13 "Market Stand-Off" Agreement.................................................13
2.14 Rule 144 Reporting...........................................................13
Section 3. COVENANTS OF THE COMPANY.....................................................14
3.1 Basic Financial Information and Reporting....................................14
3.2 Wakefield Observer Rights....................................................14
3.3 Intel Observer Rights........................................................14
3.4 Accel Partners Observer Rights...............................................15
3.5 Media One Observer Rights....................................................15
3.6 Reservation of Voting Common Stock...........................................15
3.7 Termination of Covenants.....................................................15
Section 4. AFFIRMATIVE COVENANTS OF THE INVESTORS.......................................16
4.1 Confidential Information, etc................................................16
Section 5. RIGHT OF FIRST REFUSAL.......................................................16
5.1 Subsequent Offerings.........................................................16
5.2 Exercise of Rights...........................................................16
5.3 Issuance of Equity Securities To Other Persons...............................17
5.4. Termination of Rights of First Refusal. .....................................17
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TABLE OF CONTENTS (CONTINUED)
PAGE
5.5 Transfer of Rights of First Refusal..........................................17
5.6 Excluded Securities..........................................................17
Section 6. MISCELLANEOUS................................................................18
6.1 Governing Law................................................................18
6.2 Survival.....................................................................18
6.3 Successors and Assigns.......................................................18
6.4 Entire Agreement.............................................................18
6.5 Severability.................................................................18
6.6 Amendment and Waiver.........................................................18
6.7 Delays or Omissions..........................................................19
6.8 Notices......................................................................19
6.9 Attorneys' Fees..............................................................19
6.10 Titles and Subtitles.........................................................19
6.11 Counterparts.................................................................20
6.12 Protection of Confidential Information.......................................20
6.13 Disclosure of Terms: Press Releases.........................................20
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QUOKKA SPORTS, INC.
AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
THIS AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT (the "Agreement")
is entered into as of the 23rd day of December, 1998, by and among QUOKKA
SPORTS, INC., a Delaware corporation (the "Company") and the holders of the
Company's Common Stock, Warrants, Series A Preferred Stock, Series B Preferred
Stock and Series C Preferred Stock set forth on Exhibit A hereto (the
"Investors"). This Agreement amends, restates and supersedes in its entirety
that certain Amended and Restated Investors' Rights Agreement dated June 12,
1998 (the "Original Investors' Rights Agreement").
RECITALS
WHEREAS, the Company and certain of its current stockholders and warrant
holders entered into the Original Investors' Rights Agreement; and
WHEREAS, the Company proposes to sell and issue up to an aggregate of
Four Million Nine Hundred Thirty Eight Thousand Seven Hundred Fifty Six
(4,938,756) shares of the Company's Series C Preferred Stock (the "Series C
Preferred") pursuant to that certain Series C Preferred Stock Purchase Agreement
dated as of the date hereof (the "Purchase Agreement"); and
WHEREAS, as a condition of entering into the Purchase Agreement, certain
Purchasers (as defined in the Purchase Agreement) have requested that the
Company extend to them registration rights, information rights and other rights
and amend the Original Investors' Rights Agreement as set forth below; and
WHEREAS, as a condition of entering into the Purchase Agreement, the
Company has requested that the Purchasers agree to restrictions on transfer,
confidentiality provisions and other obligations as set forth below.
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement and in the Purchase Agreement, the parties mutually agree as follows:
SECTION 1. GENERAL
1.1 DEFINITIONS. As used in this Agreement the following terms shall
have the following respective meanings:
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FORM S-3" means such form under the Securities Act as in effect on the
date hereof or any successor registration form under the Securities Act
subsequently adopted by the SEC which permits inclusion or incorporation of
substantial information by reference to other documents filed by the Company
with the SEC.
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"HOLDER" means any person owning of record any shares of the Non-Voting
Common Stock, Shares, Warrants or Registrable Securities that have not been sold
to the public or any assignee of record of such Registrable Securities in
accordance with Section 2.9 hereof.
"INITIAL OFFERING" means the Company's first firm commitment
underwritten public offering of its Common Stock registered under the Securities
Act.
"MAJOR INVESTOR" means each Purchaser (as such term is defined in that
certain Common Stock Purchase Agreement dated August 19, 1997), each Purchaser
(as such term is defined in that certain Series A Preferred Stock Purchase
Agreement dated December 4, 1997 with a subsequent closing on December 19,
1997), each Purchaser (as such term is defined in that certain Series B
Preferred Stock Purchase Agreement dated June 12, 1998 with a subsequent closing
on August 11, 1998) and each Purchaser (as such term is defined in the Purchase
Agreement) or any assignee of record in accordance with Section 5.5 hereof.
"NON-VOTING COMMON STOCK" means such shares of the Company's Non-Voting
Common Stock sold pursuant to the Common Stock Purchase Agreement dated April
12, 1997 or the Common Stock Purchase Agreement dated January 31, 1997.
"REGISTER," "REGISTERED," AND "REGISTRATION" refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement or documents.
"REGISTRABLE SECURITIES" means (i) any of the Shares, if such Shares are
shares of the Company's Voting Common Stock; (ii) any shares of the Company's
Voting Common Stock issued pursuant to the conversion of the Non-Voting Common
Stock, the Series C Preferred, the Series B Preferred or the Series A Preferred;
(iii) any shares of the Company's Voting Common Stock issued pursuant to the
exercise of the Warrants; and (iv) any shares of the Company's Voting Common
Stock issued as (or issuable upon the conversion or exercise of any warrants,
right or other security which is issued as) a dividend or other distribution
with respect to, or in exchange for or in replacement of, such above-described
securities or the Non-Voting Common Stock or the Warrants. Notwithstanding the
foregoing, Registrable Securities shall not include any securities sold by a
person to the public either pursuant to a registration statement or Rule 144 or
sold in a private transaction in which the transferor's rights under Section 2
of this Agreement are not assigned.
"REGISTRABLE SECURITIES THEN OUTSTANDING" shall be the number of shares
that are Registrable Securities and either (1) are then issued and outstanding
or (2) are issuable pursuant to then exercisable or convertible securities.
"REGISTRATION EXPENSES" shall mean all expenses incurred by the Company
in complying with Sections 2.2, 2.3 and 2.4 hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, reasonable fees and disbursements not
to exceed Fifteen Thousand Dollars ($15,000) of a single special counsel for the
Holders, blue sky fees and expenses and the expense of any special audits
incident to or required by any such registration (but excluding the compensation
of regular employees of the Company which shall be paid in any event by the
Company).
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"SEC" OR "COMMISSION" means the Securities and Exchange Commission.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SELLING EXPENSES" shall mean all underwriting discounts and selling
commissions applicable to the sale.
"SERIES A PREFERRED" means the Company's Series A Preferred Stock.
"SERIES B PREFERRED" means the Company's Series B Preferred Stock.
"SERIES C PREFERRED" means the Company's Series C Preferred Stock.
"SHARES" shall mean (i) the Company's Series C Preferred, (ii) the
Company's Series B Preferred, (iii) the Company's Series A Preferred, (iv) the
Company's Voting Common Stock issued pursuant to that certain Common Stock
Purchase Agreement dated August 19, 1997 by and among the Company and the
Purchasers set forth on Exhibit A thereto, (v) the Company's Voting Common Stock
and Non-Voting Common Stock issued pursuant to that certain Common Stock
Purchase Agreement dated April 2, 1997 by and between the Company and Xxxxxxx X.
Xxxxxxxx and (vi) the Company's Voting Common Stock issued pursuant to that
certain Common Stock Purchase Agreement dated January 31, 1997 between the
Company and Quokka Sports Pty Ltd. as trustee for Ozware Developments Unit
Trust.
"WARRANTS" means (i) the warrants to purchase Voting Common Stock of the
Company issued pursuant to that certain Note and Warrant Purchase Agreement
dated October 31, 1997 among the Company and the Purchasers set forth on Exhibit
A thereto and (ii) the warrants, if any, held by Intel Corporation, MediaOne
Interactive Services, Inc. ("MediaOne"), any affiliate of MediaOne to whom such
warrants have been originally issued, America's Olympic Network, LLC or its
assignees, including the National Broadcasting Corporation, Inc.
SECTION 2. REGISTRATION; RESTRICTIONS ON TRANSFER
2.1 RESTRICTIONS ON TRANSFER.
(a) Each Holder agrees not to make any disposition of all or any
portion of the Non-Voting Common Stock, Shares or Registrable Securities unless
and until:
(i) There is then in effect a registration statement
under the Securities Act covering such proposed disposition and such disposition
is made in accordance with such registration statement; or
(ii) (A) The disposition is made under Rule 144 or its
equivalent, (B) such Holder shall have notified the Company of the proposed
disposition and shall have furnished the Company with a statement of the
circumstances surrounding the proposed disposition, and (C) such Holder shall
have furnished the Company with an opinion of counsel that such disposition will
not require registration under the Securities Act if reasonably requested by the
Company, which request shall only be made in unusual circumstances;
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(iii) (A) The transferee has agreed in writing to be
bound by the terms of this Agreement, (B) such Holder shall have notified the
Company of the proposed disposition and shall have furnished the Company with a
statement of the circumstances surrounding the proposed disposition, and (C) if
reasonably requested by the Company, such Holder shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the
Securities Act.
(iv) Notwithstanding the provisions of paragraphs (i),
(ii) and (iii) above, no such registration statement or opinion of counsel shall
be necessary for a transfer by a Holder which is (A) a partnership to its
partners or former partners in accordance with partnership interests, (B) a
corporation to its shareholders in accordance with their interest in the
corporation, or to a wholly-owned subsidiary, (C) a limited liability company to
its members or former members in accordance with their interest in the limited
liability company, or (D) to the Holder's family member or trust for the benefit
of an individual Holder, provided any such transferee will be subject to the
terms of this Agreement to the same extent as if he were an original Holder
hereunder.
(b) Each certificate representing the Shares or Registrable
Securities shall (unless otherwise permitted by the provisions of this
Agreement) be stamped or otherwise imprinted with legends substantially similar
to the following (in addition to any legend required under applicable state
securities laws, under Section 45 the Company's Bylaws (Right of First Refusal)
or as provided elsewhere in this Agreement):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED
UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY
HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SALE, TRANSFER OR ASSIGNMENT OF THE SECURITIES REPRESENTED BY
THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF AN AGREEMENT BETWEEN
THE COMPANY AND THE REGISTERED HOLDER OR HIS PREDECESSOR IN
INTEREST. COPIES OF SUCH AGREEMENT MAY BE OBTAINED BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
SECRETARY OF THE COMPANY.
(c) The Company shall be obligated to reissue promptly unlegended
certificates at the request of any holder thereof if the holder shall have
obtained an opinion of counsel (which counsel may be counsel to the Company)
reasonably acceptable to the Company to the effect that the securities proposed
to be disposed of may lawfully be so disposed of without registration,
qualification or legend.
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(d) Any legend endorsed on an instrument pursuant to applicable
state securities laws and the stop-transfer instructions with respect to such
securities shall be removed upon receipt by the Company of an order of the
appropriate blue sky authority authorizing such removal.
2.2 DEMAND REGISTRATION.
(a) Subject to the conditions of this Section 2.2, if the Company
shall receive a written request from the Holders of more than fifty percent
(50%) of the Registrable Securities then outstanding (the "Initiating Holders")
that the Company file a registration statement under the Securities Act covering
the registration of Registrable Securities having an aggregate offering price to
the public in excess of $10,000,000 (a "Qualified Public Offering"), then the
Company shall, within twenty (20) days of the receipt thereof, give written
notice of such request to all Holders, and subject to the limitations of this
Section 2.2, use its best efforts to effect, as soon as practicable, the
registration under the Securities Act of all Registrable Securities that the
Holders request to be registered.
(b) If the Initiating Holders intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 2.2 or any request pursuant to Section 2.3 or 2.4 and the Company
shall include such information in the written notice referred to in Section
2.4(a) or Section 2.5(a), as applicable. In such event, the right of any Holder
to include its Registrable Securities in such registration shall be conditioned
upon such Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting (unless otherwise mutually
agreed by a majority in interest of the Initiating Holders and such Holder) to
the extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by a majority in interest of the Initiating Holders (which
underwriter or underwriters shall be reasonably acceptable to the Company).
Notwithstanding any other provision of this Section 2.4, if the underwriter
advises the Company that marketing factors require a limitation of the number of
securities to be underwritten (including Registrable Securities) then the
Company shall so advise all Holders of Registrable Securities which would
otherwise be underwritten pursuant hereto, and the number of shares that may be
included in the underwriting shall be allocated to the Holders of such
Registrable Securities which would otherwise be underwritten pursuant hereto on
a pro rata basis based on the number of Registrable Securities held by all such
Holders (including the Initiating Holders). Any Registrable Securities excluded
or withdrawn from such underwriting shall be withdrawn from the registration.
(c) The Company shall not be required to effect a registration
pursuant to this Section 2.2:
(i) Prior to the completion of the Company's Initial
Offering;
(ii) after the Company has effected two (2)
registrations pursuant to this Section 2.2, and such registrations have been
declared or ordered effective by the SEC;
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(iii) during the period starting with the date of filing
of, and ending on the date one hundred eighty (180) days following the effective
date of the registration statement relating to the Company's equity securities
pertaining to the Initial Offering; provided that the Company makes reasonable
good faith efforts to cause such registration statement to become effective; or
(iv) if the Company shall furnish to Holders requesting
the filing of a registration statement pursuant to this Section 2.4, a
certificate signed by the Chairman of the Board stating that in the good faith
judgment of the Board of Directors of the Company, it would be seriously
detrimental to the Company and its shareholders for such registration statement
to be effected at such time, in which event the Company shall have the right to
defer such filing for a period of not more than sixty (60) days after receipt of
the request of the Initiating Holders; provided that such right to delay a
request shall be exercised by the Company not more than twice in any twelve (12)
month period.
2.3 PIGGYBACK REGISTRATIONS. The Company shall notify all Holders of
Registrable Securities in writing at least thirty (30) days prior to the filing
of any registration statement under the Securities Act for purposes of a public
offering of securities of the Company (including, but not limited to, the
Initial Offering and registration statements relating to secondary offerings of
securities of the Company, but excluding registration statements relating to
employee benefit plans or with respect to corporate reorganizations or other
transactions under Rule 145 of the Securities Act) and will afford each such
Holder an opportunity to include in such registration statement all or part of
such Registrable Securities held by such Holder. Each Holder desiring to include
in any such registration statement all or any part of the Registrable Securities
held by it shall, within fifteen (15) days after the above-described notice from
the Company, so notify the Company in writing. Such notice shall state the
intended method of disposition of the Registrable Securities by such Holder. If
a Holder decides not to include all of its Registrable Securities in any
registration statement thereafter filed by the Company, such Holder shall
nevertheless continue to have the right to include any Registrable Securities in
any subsequent registration statement or registration statements as may be filed
by the Company with respect to offerings of its securities, all upon the terms
and conditions set forth herein.
(a) UNDERWRITING. If the registration statement under which the
Company gives notice under this Section 2.3 is for an underwritten offering, the
Company shall so advise the Holders of Registrable Securities. In such event,
the right of any such Holder to be included in a registration pursuant to this
Section 2.3 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their Registrable Securities through such underwriting shall enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting by the Company. Notwithstanding any other
provision of the Agreement, if the underwriter determines in good faith that
marketing factors require a limitation of the number of shares to be
underwritten, the number of shares that may be included in the underwriting
shall be allocated first, to the Company; second, to the Holders on a pro rata
basis based on the total number of Registrable Securities held by the Holders
who wish to sell in such offering; and third, to any shareholder of the Company
(other than a Holder of Registrable Securities) on a pro rata basis.
Notwithstanding the immediately preceding sentence, in no event shall the amount
of securities
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of the selling Holders included in the registration be reduced below twenty-five
percent (25%) of the total amount of securities included in such registration,
unless such offering is the Initial Offering, in which event any or all of the
Registrable Securities of the Holders may be excluded in accordance with the
immediately preceding sentence. In no event will shares of any other selling
shareholder be included in any such registration which would reduce the number
of shares which may be included by Holders without the written consent of
Holders of more than fifty percent (50%) of the Registrable Securities proposed
to be sold in the offering.
(b) RIGHT TO TERMINATE REGISTRATION. The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 2.3 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration. The Registration
Expenses of such withdrawn registration shall be borne by the Company in
accordance with Section 2.5 hereof.
2.4 FORM S-3 REGISTRATION. After the Initial Offering, in the event the
Company shall receive a written request from the Holders of more than fifty
percent (50%) of the Registrable Securities then outstanding (the "Initiating
Holders") that the Company effect a registration on Form S-3 (or any successor
to Form S-3) or any similar short-form registration statement and any related
qualification or compliance with respect to all or a part of the Registrable
Securities owned by such Holder or Holders, the Company will:
(a) promptly give written notice of the proposed registration,
and any related qualification or compliance, to all other Holders of Registrable
Securities; and
(b) as soon as practicable, effect such registration and all such
qualifications and compliances as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Initiating
Holder's or Initiating Holders' Registrable Securities as are specified in such
request, together with all or such portion of the Registrable Securities of any
other Holder or Holders joining in such request as are specified in a written
request given to the Company by any such other Holder or Holders within fifteen
(15) days after receipt of such written notice from the Company; provided,
however, that the Company shall not be obligated to effect any such
registration, qualification or compliance pursuant to this Section 2.4:
(i) if Form S-3 (or any successor or similar form) is
not available for such offering by the Holders, or
(ii) if the Holders, together with the holders of any
other securities of the Company entitled to inclusion in such registration,
propose to sell Registrable Securities and such other securities (if any) at an
aggregate price to the public of less than $1,000,000, or
(iii) if the Company shall furnish to the Holders a
certificate signed by the Chairman of the Board of Directors of the Company
stating that in the good faith judgment of the Board of Directors of the
Company, it would be seriously detrimental to the Company for such Form S-3
Registration to be effected at such time, in which event the Company shall have
the right to defer the filing of the Form S-3 registration statement for (a) a
period of not more than sixty (60) days after receipt of the request of the
Initiating Holder or Initiating Holders
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under this Section 2.4; and (b) a period of not more than thirty (30) days after
the lapse of the sixty (60) day deferral referenced in Section 2.4(b)(iii)(a)
immediately above; provided, that such rights to delay a request shall be
exercised by the Company not more than once in any twelve (12) month period, or
(iv) if the Company has, within the twelve (12) month
period preceding the date of such request, already effected one (1) registration
on Form S-3 for the Holders pursuant to this Section 2.4,
(v) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a general consent to
service of process in effecting such registration, qualification or compliance,
unless the Registered Securities would not, on account of this limitation, be
available for offer and sale in at least twenty states, or
(vi) if the Company has, within the one hundred eighty
(180) day period preceding the date of such request, effected a Company
initiated registration (other than a registration effected solely to qualify an
employee benefit plan or to effect a business combination pursuant to Rule 145).
(c) Subject to the foregoing, the Company shall file a Form S-3
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders.
2.5 EXPENSES OF REGISTRATION. Except as specifically provided in this
Section 2.5, all Registration Expenses incurred in connection with any
registration under Section 2.2, Section 2.3 or Section 2.4 herein shall be borne
by the Company. All Selling Expenses incurred in connection with any
registrations hereunder shall be borne by the holders of the securities so
registered pro rata on the basis of the number of shares sold. The Company shall
not, however, be required to pay for expenses of any registration proceeding
begun pursuant to Section 2.2, the request of which has been subsequently
withdrawn by the Initiating Holders unless (a) the withdrawal is based upon
material adverse information concerning the Company of which the Initiating
Holders were not aware at the time of such request or (b) the Holders of a
majority of Registrable Securities agree to forfeit their right to one requested
registration pursuant to Section 2.2, in which event such right shall be
forfeited by all Holders). Additionally, the Company shall not be required to
pay for expenses in any registration proceeding begun pursuant to Section 2.4,
the request of which has been subsequently withdrawn by the Initiating Holders
unless (a) the withdrawal is based upon material adverse information concerning
the Company of which the Initiating Holders were not aware at the time of such
request or (b) the Holders of a majority of Registrable Securities agree that
such registration shall be deemed a completed registration for the purpose of
Section 2.4(b)(iv). If the Holders are required to pay the Registration
Expenses, such expenses shall be borne by the holders of securities (including
Registrable Securities) requesting such registration in proportion to the number
of shares for which such registration was requested.
2.6 OBLIGATIONS OF THE COMPANY. Whenever required to effect the
registration of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:
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(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use all reasonable efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for up to ninety (90) days or, if earlier,
until the Holder or Holders have completed the distribution related thereto.
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities being registered by
them.
(d) Use all reasonable efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by the
Holders, provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent
to service of process in any such states or jurisdictions, unless the Registered
Securities would not, on account of this limitation, be available for offer and
sale in at least twenty states.
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter(s) of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.
(g) Furnish, at the request of a majority of the Holders
participating in the registration, on the date that such Registrable Securities
are delivered to the underwriters for sale, if such securities are being sold
through underwriters, or, if such securities are not being sold through
underwriters, on the date that the registration statement with respect to such
securities becomes effective, (i) an opinion, dated as of such date, of the
counsel representing the Company for the purposes of such registration, in form
and substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities and (ii) a letter dated as of such date,
from the independent certified public accountants of the Company, in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriters,
if any, and if permitted by applicable accounting standards, to the Holders
requesting registration of Registrable Securities.
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2.7 TERMINATION OF REGISTRATION RIGHTS. All registration rights granted
under this Section 2 shall terminate and be of no further force and effect ten
(10) years after the date of the Company's Initial Offering. In addition, a
Holder's registration rights shall expire if (i) the Company has completed its
Initial Offering and is subject to the provisions of the Exchange Act, (ii) such
Holder (together with its affiliates, partners and former partners) holds less
than 1% of the Company's outstanding Common Stock (treating all shares of
convertible Preferred Stock on an as converted basis) and (iii) all Registrable
Securities held by and issuable to such Holder may be sold under Rule 144(k) or
all Registrable Securities held by and issuable to such Holder may be sold under
Rule 144 during any ninety (90) day period.
2.8 DELAY OF REGISTRATION; FURNISHING INFORMATION
(a) No Holder shall have any right to obtain or seek an
injunction restraining or otherwise delaying any such registration as the result
of any controversy that might arise with respect to the interpretation or
implementation of this Section 2.
(b) It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 2.2, 2.3 or 2.4 that the selling
Holders shall furnish to the Company such information regarding themselves, the
Registrable Securities held by them and the intended method of disposition of
such securities as shall be required to effect the registration of their
Registrable Securities.
2.9 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under Section 2.2, 2.3 or 2.4:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, the partners, officers, directors and legal
counsel of each Holder, any underwriter (as defined in the Securities Act) for
such Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the Securities Act or the Exchange Act, against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements,
omissions or violations (collectively a "Violation") by the Company: (i) any
untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Company of the Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law in
connection with the offering covered by such registration statement; and the
Company will reimburse each such Holder, partner, officer or director,
underwriter or controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this Section 2.9(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company, which consent shall
not be unreasonably withheld, nor shall the Company be liable in
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any such case for any such loss, claim, damage, liability or action to the
extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by such Holder, partner, officer,
director, underwriter or controlling person of such Holder.
(b) To the extent permitted by law, each Holder will, if
Registrable Securities held by such Holder are included in the securities as to
which such registration qualifications or compliance is being effected,
indemnify and hold harmless the Company, each of its directors, its officers,
and legal counsel and each person, if any, who controls the Company within the
meaning of the Securities Act, any underwriter and any other Holder selling
securities under such registration statement or any of such other Holder's
partners, directors or officers or any person who controls such Holder, against
any losses, claims, damages or liabilities (joint or several) to which the
Company or any such director, officer, controlling person, underwriter or other
such Holder, or partner, director, officer or controlling person of such other
Holder may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages or liabilities (or
actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs in
reliance upon and in conformity with written information furnished by such
Holder under an instrument duly executed by such Holder and stated to be
specifically for use in connection with such registration; and each such Holder
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer, controlling person, underwriter or other Holder, or
partner, officer, director or controlling person of such other Holder in
connection with investigating or defending any such loss, claim, damage,
liability or action if it is judicially determined that there was such a
Violation; provided, however, that the indemnity agreement contained in this
Section 2.9(b) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Holder, which consent shall not be unreasonably withheld;
provided further, that in no event shall any indemnity under this Section 2.9
exceed the net proceeds from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 2.9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 2.9, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, shall not relieve such indemnifying party of
any liability to the indemnified party under this Section 2.9, except to the
extent that the indemnifying party is materially prejudiced by such delay, but
the omission so to deliver written notice to the indemnifying party will not
relieve it of any liability that it may have to any indemnified party otherwise
than under this Section 2.9.
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(d) If the indemnification provided for in this Section 2.9 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any losses, claims, damages or liabilities referred to
herein, the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall to the extent permitted by applicable law contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the Violation(s) that resulted in such
loss, claim, damage or liability, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by a court of law by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, that in no event shall any contribution by a
Holder hereunder exceed the proceeds from the offering received by such Holder.
(e) The obligations of the Company and Holders under this Section
2.9 shall survive completion of any offering of Registrable Securities in a
registration statement. No Indemnifying Party, in the defense of any such claim
or litigation, shall, except with the consent of each Indemnified Party, consent
to entry of any judgment or enter into any settlement which does not include as
an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect to such claim or
litigation.
2.10 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the Company
to register Registrable Securities pursuant to this Section 2 may be assigned by
a Holder to any transferee or assignee of Registrable Securities which (i) any
person or entity holding Registrable Securities pursuant to a transfer permitted
by Section 2.1(a)(iii), or (ii) acquires at least fifty thousand (50,000) shares
of Registrable Securities (as adjusted for stock splits and combinations);
provided, however, (A) the transferor shall furnish to the Company written
notice of the name and address of such transferee or assignee and the securities
with respect to which such registration rights are being assigned, it being
understood that, until such time as the Company receives such written notice,
the Company is under no obligation to treat such transferee or assignee as a
holder of registration rights, and (B) such transferee shall agree to be subject
to all restrictions set forth in this Agreement.
2.11 AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Section 2
may be amended and the observance thereof may be waived (either generally or in
a particular instance and either retroactively or prospectively), only with the
written consent of the Company and the Holders of more than fifty percent (50%)
of the Registrable Securities then outstanding, provided that such amendment or
waiver does not differentiate among similarly situated stockholders. Any
amendment or waiver effected in accordance with this Section 2.11 shall be
binding upon each Holder and the Company. By acceptance of any benefits under
this Section 2, Holders of Registrable Securities hereby agree to be bound by
the provisions hereunder.
2.12 LIMITATION ON SUBSEQUENT REGISTRATION RIGHTS. After the date of
this Agreement, the Company shall not, without the prior written consent of the
Holders of more than fifty percent (50%) of the Registrable Securities, enter
into any agreement with any holder or
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prospective holder of any securities of the Company that would grant such holder
registration rights senior to those granted to the Holders hereunder.
2.13 "MARKET STAND-OFF" AGREEMENT. Each Holder hereby agrees that such
Holder shall not sell or otherwise transfer or dispose of any Common Stock (or
other securities) of the Company held by such Holder (other than those included
in the registration) for a period specified by the representative of the
underwriters of Common Stock (or other securities) of the Company not to exceed
one hundred eighty (180) days following the effective date of the first
registration statement of the Company filed under the Securities Act or ninety
(90) days following the effective date of subsequent registration statements,
provided that all officers and directors of the Company enter into similar
agreements and that, to the extent that any such officer or director is released
from any such agreement, the Holders shall also be released to such extent from
the restriction contained in this Section 2.13.
Each Holder agrees to execute and deliver such other agreements as may
be reasonably requested by the Company or the underwriter which are consistent
with the foregoing or which are necessary to give further effect thereto. The
obligations described in this Section 2.13 shall not apply to a registration
relating solely to employee benefit plans on Form S-1 or Form S-8 or similar
forms that may be promulgated in the future, or a registration relating solely
to a Commission Rule 145 transaction on Form S-4 or similar forms that may be
promulgated in the future. The Company may impose stop-transfer instructions
with respect to the shares of Common Stock (or other securities) subject to the
foregoing restriction until the end of said one hundred eighty (180) day period.
2.14 RULE 144 REPORTING. With a view to making available to the Holders
the benefits of certain rules and regulations of the SEC which may permit the
sale of the Registrable Securities to the public without registration, the
Company agrees to use its best efforts to:
(a) Make and keep public information available, as those terms
are understood and defined in SEC Rule 144 or any similar or analogous rule
promulgated under the Securities Act, at all times after the effective date of
the first registration filed by the Company for an offering of its securities to
the general public;
(b) File with the SEC, in a timely manner, all reports and other
documents required of the Company under the Exchange Act;
(c) So long as a Holder owns any Registrable Securities, furnish
to such Holder forthwith upon request: a written statement by the Company as to
its compliance with the reporting requirements of said Rule 144 of the
Securities Act, and of the Exchange Act (at any time after it has become subject
to such reporting requirements); a copy of the most recent annual or quarterly
report of the Company; and such other reports and documents as a Holder may
reasonably request in availing itself of any rule or regulation of the SEC
allowing it to sell any such securities without registration.
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SECTION 3. COVENANTS OF THE COMPANY.
3.1 BASIC FINANCIAL INFORMATION AND REPORTING.
(a) The Company will maintain true books and records of account
in which full and correct entries will be made of all its business transactions
pursuant to a system of accounting established and administered in accordance
with generally accepted accounting principles consistently applied, and will set
aside on its books all such proper accruals and reserves as shall be required
under generally accepted accounting principles consistently applied.
(b) As soon as practicable after the end of each fiscal year of
the Company, and in any event within ninety (90) days thereafter, the Company
will furnish each Holder holding Registrable Securities a consolidated balance
sheet of the Company, as at the end of such fiscal year, and a consolidated
statement of income and a consolidated statement of cash flows of the Company,
for such year, all prepared in accordance with generally accepted accounting
principles consistently applied and setting forth in each case in comparative
form the figures for the previous fiscal year, all in reasonable detail. Such
financial statements shall be accompanied by a report and opinion thereon by
independent public accountants of national standing selected by the Company's
Board of Directors. The Company will also furnish to each Holder, in advance, an
annual budget for each year and, within thirty (30) days after each fiscal
quarter, a report on financial and operational highlights.
(c) As soon as practicable after the end of every month, and in
any event within thirty (30) days thereafter, the Company will furnish each
Holder holding Registrable Securities an unaudited monthly report including a
consolidated balance sheet, an unaudited consolidated statement of income and an
unaudited consolidated statement of cash flows of the Company, all prepared in
accordance with generally accepted accounting principles (other than for
accompanying notes and changes resulting from year-end audit adjustments), and
setting forth in each case in comparative form the figures for the previous
fiscal year and the projected results for the upcoming fiscal year, all in
reasonable detail.
3.2 WAKEFIELD OBSERVER RIGHTS. So long as Wakefield Group II LLC
("Wakefield") and its affiliates continue to hold in the aggregate at least
eight hundred thousand (800,000) shares (as adjusted for stock splits and like
events) of the Company's Voting Common Stock, Wakefield shall have the right, at
Wakefield's expense, to designate a representative to attend all meetings
(including meetings to be held by telephone) of the Company's Board of Directors
in a non-voting observer capacity, and, in this respect, the Company shall give
such representative copies of all notices, minutes, consents and other materials
that it provides to directors; provided, however, that such representative shall
agree to hold in confidence and trust all information so provided. The Company
shall have the right to approve Wakefield's representative, such approval not to
be unreasonably withheld.
3.3 INTEL OBSERVER RIGHTS. So long as Intel Corporation ("Intel") and
its affiliates continue to hold in the aggregate at least one million one
hundred seventy-six thousand four hundred seventy-one (1,176,471) shares (as
adjusted for stock splits and like events) of the Company's Series A Preferred
Stock, Intel shall have the right, at Intel's expense, to designate a
representative to attend all meetings (including meetings to be held by
telephone) of the
14.
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Company's Board of Directors in a non-voting observer capacity, and, in this
respect, the Company shall give such representative copies of all notices,
minutes, consents and other materials that it provides to directors; provided,
however, that such representative shall agree to hold in confidence and trust
all information so provided. The Company shall have the right to approve Intel's
representative, such approval not to be unreasonably withheld.
3.4 ACCEL PARTNERS OBSERVER RIGHTS. So long as Accel Partners ("Accel")
and its affiliates continue to hold in the aggregate at least two million five
hundred thousand (2,500,000) shares (as adjusted for stock splits and like
events) of the Company's Series B Preferred Stock, Accel shall have the right,
at Accel's expense, to designate a representative to attend all meetings
(including meetings to be held by telephone) of the Company's Board of Directors
in a non-voting observer capacity, and, in this respect, the Company shall give
such representative copies of all notices, minutes, consents and other materials
that it provides to directors; provided, however, that such representative shall
agree to hold in confidence and trust all information so provided. The Company
shall have the right to approve Accel's representative, such approval not to be
unreasonably withheld; provided, however, that any employee, director or partner
of Accel who has no significant relationship with any competitor of the Company
and otherwise has no conflict of interest with the Company's interests shall be
deemed acceptable to the Company.
3.5 MEDIA ONE OBSERVER RIGHTS. So long as MediaOne and its affiliates
continue to hold in the aggregate at least two million (2,000,000) shares (as
adjusted for stock splits and like events) of the Company's Series B Preferred
Stock and Series C Preferred Stock, and at such time as MediaOne or its
affiliates do not have a representative on the Company's Board of Directors,
MediaOne shall have the right, at MediaOne's expense, to designate a
representative to attend all meetings (including meetings to be held by
telephone) of the Company's Board of Directors in a non-voting observer
capacity, and, in this respect, the Company shall give such representative
copies of all notices, minutes, consents and other materials that it provides to
directors; provided, however, that such representative shall agree to hold in
confidence and trust all information so provided. The Company shall have the
right to approve MediaOne's representative, such approval not to be unreasonably
withheld; provided, however, that any employee, director or partner of MediaOne
who has no significant relationship with any competitor of the Company and
otherwise has no conflict of interest with the Company's interests shall be
deemed acceptable to the Company.
3.6 RESERVATION OF VOTING COMMON STOCK. The Company will at all times
reserve and keep available, solely for issuance and delivery upon the conversion
of the outstanding Non-Voting Common Stock, all Voting Common Stock issuable
from time to time upon such conversion.
3.7 TERMINATION OF COVENANTS. All covenants of the Company contained in
Section 3 of this Agreement shall expire and terminate as to each Holder on the
closing of the Initial Offering at such time as the Company is otherwise subject
to the provisions of the Securities Exchange Act of 1934, as amended.
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SECTION 4. AFFIRMATIVE COVENANTS OF THE INVESTORS
4.1 CONFIDENTIAL INFORMATION, ETC. In addition to the provision set
forth in Sections 6.12 and 6.13, each Investor agrees that (a) all information
received by such Investor pursuant to Section 3 and (b) any other information,
including without limitation information relating to the Company's customers,
technology, processes or formulas, that (i) is disclosed by the Company to such
Investor and (ii) is identified by the Company as being confidential or
proprietary, shall be considered confidential information. Each Investor further
agrees that such Investor shall hold all such confidential information in
confidence and shall not disclose any such confidential information to any third
party other than such Investor's counsel or accountants nor shall such Investor
use such confidential information for any purpose other than evaluation of such
Investor's investment in the Company; provided, however, that the foregoing
obligation to hold in confidence and not to disclose confidential information
shall not apply to any such information that (1) was available to the public
prior to disclosure by the Company, (2) becomes available to the public through
no fault of such Investor, (3) is disclosed to such Investor on a
non-confidential basis by a third party, provided that the Investor determines
after reasonable inquiry that the third party has a legal right to make such
disclosure or (4) is independently developed by such Investor.
SECTION 5. RIGHT OF FIRST REFUSAL
5.1 SUBSEQUENT OFFERINGS. Each Major Investor shall have a right of
first refusal to purchase its pro rata share of all Equity Securities, as
defined below, that the Company may, from time to time, propose to sell and
issue after the date of this Agreement, other than the Equity Securities
excluded by Section 5.6 hereof. Each Major Investor's pro rata share is equal to
the ratio of (a) the number of shares of the Company's Voting Common Stock
(including all shares of Voting Common Stock issued or issuable upon conversion
of the Shares) which such Investor is deemed to be a holder immediately prior to
the issuance of such Equity Securities to (b) the total number of shares of the
Company's outstanding Voting Common Stock (including all shares of Voting Common
Stock issued or issuable upon conversion of the Shares or upon the exercise of
any outstanding warrants or options) immediately prior to the issuance of the
Equity Securities. The term "Equity Securities" shall mean (i) any Common Stock,
Preferred Stock or other security of the Company, (ii) any security convertible,
with or without consideration, into any Common Stock, Preferred Stock or other
security (including any option to purchase such a convertible security), (iii)
any security carrying any warrant or right to subscribe to or purchase any
Common Stock, Preferred Stock or other security or (iv) any such warrant or
right.
5.2 EXERCISE OF RIGHTS. If the Company proposes to issue any Equity
Securities, it shall give each Major Investor written notice of its intention,
describing the Equity Securities, the price and the terms and conditions upon
which the Company proposes to issue the same. Each Major Investor shall have
fifteen (15) days from the giving of such notice to agree to the purchase of its
pro rata share of the Equity Securities for the price and upon the terms and
conditions specified in the notice by giving written notice to the Company and
stating therein the quantity of Equity Securities to be purchased.
Notwithstanding the foregoing, the Company shall not be required to offer or
sell such Equity Securities to any Investor who would cause the Company to be in
violation of applicable federal securities laws by virtue of such offer or sale.
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5.3 ISSUANCE OF EQUITY SECURITIES TO OTHER PERSONS. The Company shall
have one hundred twenty (120) days after the notice provided pursuant to Section
5.2 to sell the Equity Securities in respect of which the Major Investor's
rights were not exercised, at a price and upon terms and conditions materially
no more favorable to the purchasers thereof than specified in the Company's
notice to the Major Investors pursuant to Section 5.2 hereof. If the Company has
not sold such Equity Securities within one hundred twenty (120) days of the
notice provided pursuant to Section 5.2, the Company shall not thereafter issue
or sell any Equity Securities, without first offering such securities to the
Major Investors in the manner provided above.
5.4 TERMINATION OF RIGHTS OF FIRST REFUSAL. The rights of first refusal
established by this Section 5 shall not apply to, and shall terminate upon the
closing of the Initial Offering.
5.5 TRANSFER OF RIGHTS OF FIRST REFUSAL. The rights of first refusal of
each Major Investor under this Section 5 may be transferred to the same parties,
subject to the same restrictions as any transfer of registration rights pursuant
to Section 2.10.
5.6 EXCLUDED SECURITIES. The rights of first refusal established by this
Section 5 shall have no application to any of the following Equity Securities:
(a) shares of Common Stock (and/or options, warrants or other
Common Stock purchase rights issued pursuant to such options, warrants or other
rights) issued or to be issued to employees, officers or directors of, or
consultants or advisors to the Company or any subsidiary, pursuant to stock
purchase or stock option plans or other arrangements that are approved by the
Board of Directors;
(b) stock issued pursuant to any rights or agreements outstanding
as of the date of this Agreement, including options and warrants outstanding as
of the date of this Agreement, and stock issued pursuant to any such rights or
agreements granted after the date of this Agreement, provided that the rights of
first refusal established by this Section 5 applied with respect to the initial
sale or grant by the Company of such rights or agreements;
(c) any Equity Securities issued for consideration other than
cash pursuant to a merger, consolidation, acquisition or similar business
combination;
(d) shares of Common Stock issued in connection with any stock
split, stock dividend or recapitalization by the Company;
(e) shares of Common Stock issued upon conversion of the Shares;
(f) any Equity Securities issued in connection with any
technology licensing, corporate Partnering, equipment leasing arrangement, debt
financing or similar transaction approved by the Board of Directors; and
(g) any Equity Securities that are issued by the Company in the
Initial Offering.
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SECTION 6. MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of California as applied to agreements among
California residents entered into and to be performed entirely within
California.
6.2 SURVIVAL. The representations, warranties, covenants, and agreements
made herein shall survive any investigation made by any Holder and the closing
of the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument.
6.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of Registrable Securities from time to time;
provided, however, that prior to the receipt by the Company of adequate written
notice of the transfer of any Registrable Securities specifying the full name
and address of the transferee, the Company may deem and treat the person listed
as the holder of such shares in its records as the absolute owner and holder of
such shares for all purposes, including the payment of dividends or any
redemption price.
6.4 ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
6.5 SEVERABILITY. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, the validity, legality, and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
6.6 AMENDMENT AND WAIVER.
(a) Except as otherwise expressly provided, this Agreement may be
amended or modified only upon the written consent of the Company and the holders
of more than fifty percent (50%) of the Registrable Securities, provided that
such amendment or waiver does not differentiate among similarly situated
stockholders.
(b) Except as otherwise expressly provided, the obligations of
the Company and the rights of the Holders under this Agreement may be waived
only with the written consent of the holders of more than fifty percent (50%) of
the Registrable Securities, provided that such amendment or waiver does not
differentiate among similarly situated stockholders.
(c) Each Holder acknowledges that by the operation of this
Section 6.6, the holders of more than fifty percent (50%) of the Registrable
Securities may have the right and power to diminish or eliminate all rights of
such Holder under this Agreement.
(d) Notwithstanding the foregoing however, Section 3.2 may not be
amended without the written consent of Wakefield Group II LLC.
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(e) Notwithstanding the foregoing however, Section 3.3 may not be
amended without the written consent of Intel Corporation.
(f) Notwithstanding the foregoing however, Section 3.4 may not be
amended without the written consent of Accel.
(g) Notwithstanding the foregoing however, Section 3.5 may not be
amended without the written consent of MediaOne.
(h) Notwithstanding the foregoing however, Section 5 may not be
amended or waived without the written consent of the Major Investors holding
more than sixty-six and two thirds percent (66 2/3%) of the Registrable
Securities held by all Major Investors.
(i) Notwithstanding the foregoing, this Agreement may be amended
with only the written consent of the Company to include additional purchasers of
Shares as "Investors," "Holders" and parties hereto.
6.7 DELAYS OR OMISSIONS. It is agreed that no delay or omission to
exercise any right, power, or remedy accruing to any Holder, upon any breach,
default or noncompliance of the Company under this Agreement shall impair any
such right, power, or remedy, nor shall it be construed to be a waiver of any
such breach, default or noncompliance, or any acquiescence therein, or of any
similar breach, default or noncompliance thereafter occurring. It is further
agreed that any waiver, permit, consent, or approval of any kind or character on
any Holder's part of any breach, default or noncompliance under this Agreement
or any waiver on such Holder's part of any provisions or conditions of this
Agreement must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement, by law, or otherwise afforded to Holders, shall be cumulative and not
alternative.
6.8 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified, (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, (iv) one (1) day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt, or (v) if earlier, upon receipt. All
communications shall be sent to the party to be notified at the address as set
forth on Exhibit A hereto or at such other address as such party may designate
by ten (10) days advance written notice to the other parties hereto.
6.9 ATTORNEYS' FEES. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.10 TITLES AND SUBTITLES. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
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6.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
6.12 PROTECTION OF CONFIDENTIAL INFORMATION. Intel's investment in the
Company, including the specific terms thereof, shall be considered confidential
information (the "Confidential Information") and shall not be disclosed by the
Company or any other party to this Agreement to any third party, subject to
Section 6.13 below. Each party shall immediately notify the other parties of any
information that comes to its attention which might indicate that there has been
a loss of confidentiality with respect to the Confidential Information. In the
event that the Company or any other party becomes legally compelled (by statute
or regulation or by oral questions, interrogatories, request for information or
documents, subpoena, criminal or civil investigative demand or similar process,
including without limitation, in connection with any public or private offering
of the Company's capital stock) to disclose any of the Confidential Information,
such party (the "Disclosing Party") shall provide the other party (the
"Non-Disclosing Party") with prompt written notice of that fact so that the
appropriate party may seek (with the cooperation and reasonable efforts of the
other parties) a protective order, confidential treatment or other appropriate
remedy. In such event, the Disclosing Party shall furnish only that portion of
the Confidential Information which is legally required and shall exercise
reasonable efforts to obtain reliable assurance that confidential treatment will
be accorded the Confidential Information to the extent reasonably requested by
the Non-Disclosing Party. The provisions of this Section 6.12 shall be in
addition to, and not in substitution for, the provisions of any separate
nondisclosure agreement executed by Intel and the Company with respect to any
collaboration or similar agreement.
6.13 DISCLOSURE OF TERMS: PRESS RELEASES. Notwithstanding the provisions
of Section 6.12 above, from and after the Closing (as defined in the Purchase
Agreement) the Company may disclose the Confidential Information, (i) solely to
the Company's investors, investment bankers, lenders, accountants, legal
counsel, business partners, and bona fide prospective investors, employees,
lenders and business partners, in each case only where such persons or entities
are under appropriate nondisclosure obligations and (ii) as may be required
pursuant to the Securities Act or Exchange Act. In addition, the Company may
disclose the fact that Intel is an investor in the Company to third parties
without the requirement for nondisclosure agreements. Within sixty (60) days of
the Closing, the Company may issue a press release disclosing that Intel has
invested in the Company, provided that the release does not disclose the amount
or other specific terms of the investment and is approved in advance in writing
by Intel. Intel, at its sole discretion, may provide an executive quote or other
material regarding its investment in the Company. Except for such disclosure and
press release, no other announcement regarding Intel's investment in the Company
in a press conference, in any professional or trade publication, in any
marketing materials or otherwise to the general public may be made without the
prior written consent of Intel, which consent may be withheld at the sole
discretion of Intel. Notwithstanding the foregoing and the provisions of Section
6.12 above, from and after the Closing, Intel may disclose its investment in the
Company and the terms thereof (other than Intel's put right) to third parties or
to the public at its discretion, and the Company shall have the right to
disclose to third parties any information disclosed by Intel in a press release
or other public announcement or document. If the Company or Intel determines
that any disclosure not otherwise authorized by this Section 6.13 is required by
law or regulation, then the provisions of Section 6.12 regarding disclosure of
Confidential Information by a
20.
24
Disclosing Party shall govern. Notwithstanding the provisions of Section 6.12
above, from and after the Closing, any party hereunder may disclose the
Confidential Information as may be required pursuant to the Securities Act or
Exchange Act.
21.
25
IN WITNESS WHEREOF, the parties hereto have executed this AMENDED AND
RESTATED INVESTORS' RIGHTS AGREEMENT as of the date set forth in the first
paragraph hereof.
COMPANY: INVESTORS:
QUOKKA SPORTS, INC.
By: /s/ Xxxx Xxxxxxx By:
------------------------------- --------------------------------
Xxxx Xxxxxxx
President
Name of Investor:
-----------------
Name of Signatory:
-----------------
(if applicable)
Title of Signatory:
-----------------
(if applicable)
26
EXHIBIT A
ADDRESSES
THE COMPANY
Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xx. Xxxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
INVESTORS
Ozware Developments Unit Trust
c/o Quokka Sports Pty Ltd, its trustee
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xx. Xxxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
Xx. Xxxxxxx X. Xxxxxxxx
Incline Village
000 Xxxxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxx Xxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Bayview Investors Ltd.
c/x Xxxxxxxxx, Xxxxxxxx & Company
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
Wakefield Group II LLC
0000 Xxxx Xxxxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
1.
27
EXHIBIT A
ADDRESSES (CONTINUED)
Xxxxxxx Revocable Trust u/a/d 8/21/92
Xxxxxx X. Xxxxxxx, ttee
Xxxxxxx X. Xxxxxxx, ttee
0000 Xxxxx xx xx Xxxxxx
Xxx Xxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Xxxx Xxxxxx
Koninklijke Philips Electronics
Xxxxxxxx Xxxxx XXX00
Xxxxxxxxxxx 0
XX-0000XX Xxxxxxxxx
Xxxxxxxxxxx
Tel: x00 (00) 00 00 000
Fax: x00 (00) 00 00 000
Xxxxxxx Street Partners
000 Xxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxx Xxxxxxxx
Telephone: 415-957-9378 ext. 104
Fax: 000-000-0000
Xxxx Xxxxxxx
c/o Quokka Sports, Inc.
Ground Floor
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Xxxx Xxxxxxxx
c/o Quokka Sports, Inc.
Ground Floor
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
2.
28
EXHIBIT A
ADDRESSES (CONTINUED)
Intel Corporation
c/o Xxxxxx Xxxxxxxxxx
0000 Xxxxxxx Xxxxxxx Xxxx. XX0-000
Xxxxx Xxxxx, XX 00000-0000
Tel: (000) 000-0000
Fax: (000) 000-0000
Xxxxx Xxxxxx
c/o Quokka Sports, Inc.
Ground Floor
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Media Technology Ventures, L.P.
Media Technology Ventures Entrepreneurs Fund, L.P.
Media Technology Equity Partners, L.P.
Xxx Xxxxx Xxxxxx, Xxxxx Xxx
Xxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
Trinity Ventures Ltd.
Trinity Ventures V, L.P.
Trinity V, side-by-side fund, L.P.
c/o Xx. Xxxxx X. Xxxxxxx, Xx.
0000 Xxxx Xxxx Xxxx
Xxxx. 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
GC&H Investments
c/o Cooley Godward LLP
Xxx Xxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000-0000
Attn: Xxxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
3.
29
EXHIBIT A
ADDRESSES (CONTINUED)
Stanford University
Stanford Management Company
c/o Xxxxx Xxxxxx
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Accel VI L.P.
Accel Internet Fund II L.P.
Accel Keiretsu VI L.P.
Accel Investors '98 L.P.
000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
(Copy to: Accel Partners
Xxx Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: X. Xxxxxx Sednaoui
Telephone: (000) 000-0000
Fax: (000) 000-0000)
MediaOne Interactive Services, Inc.
0000 X. Xxxxxxx Xxx., Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
The Xxxx Family 1982 Trust, dated 12/1/82, as amended
Attn: Xxxxxx Xxxx
0000 Xxxxx Xxxxx, #000
Xxx Xxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Outcast Communications, Inc.
c/o Xxxxx Xxxxxxxx
0000X Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
4.
30
EXHIBIT A
ADDRESSES (CONTINUED)
The Xxx Xxxxxxx and XxXxxx X. Xxxxxx Family Trust U/T/D 4/8/92
c/o Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
The Xxxxxxx Family Irrevocable Trust Dtd. 12/27/95 FBO Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx, Trustee
c/o Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
The Xxxxxxx Family Irrevocable Trust Dtd. 12/27/95 FBO Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx, Trustee
c/o Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
The Xxxxxxx Family Irrevocable Trust Dtd. 12/27/95 FBO Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx, Trustee
c/o Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Telephone: 000-000-0000
Fax: 000-000-0000
The Ignite Group
c/o Xxxxx Xxxxx, Venture Partner
000 Xxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Omega Ventures II, L.P.
Omega Ventures II Cayman, L.P.
Crossover Fund II, L.P.
Crossover Fund IIA, L.P.
c/o Xx Xxxxxxx
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Xxxxxxx Xxxxxx
x/x Xxxxxx Xxxxx Europe Ltd.
00 Xxxxxxxxxx Xxxxxxx
Xxxxxx, Xxxxxxx X0 0XX
(With a copy to:
Growth Phase Europe
000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000)
Xxxxxxx Xxxxxxxx
00 Xxxxxxx Xxxxxx
Xxxxxx XX0, Xxxxxxx
-- Send documents DHL to:
SeeligerY Conde
Xxxxxxxxx, 00
00000 Xxxxxx, Xxxxxx
Xxxxx
Tel: x00 0 000 00 00
Fax: x00 (0) 000 00 00
5.
31
EXHIBIT A
ADDRESSES (CONTINUED)
Xxxxxx 1991 Revocable Trust
Xxxxx Xxxxxx
0000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
M. Xxxxxxxxx Xxxxxxx
c/o Quokka Sports, Inc.
000 Xxxxxxx Xxxxxx, Xxxxxx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
6.
