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EXHIBIT 5
AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
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THIS AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this "Agreement")
is made as of the 18th day of February, 2000 by and between S3 INCORPORATED, a
Delaware corporation (the "Company") and VIABASE, INC. (BVI), a corporation
organized under the laws of the British Virgin Islands (the "Investor").
WHEREAS, the Company and the Investor have entered into an Investor
Rights Agreement dated as of September 20, 1999 (the "Investor Rights
Agreement") in connection with the purchase by the Investor of shares (the
"September Shares") of Common Stock (as defined below);
WHEREAS, the Company and the Investor have entered into that certain
Stock Purchase Agreement between the Company and the Investor dated as of
December 23, 1999 (the "Stock Purchase Agreement") whereby the Investor agreed
to purchase and the Company agreed to sell and issue to the Investor shares (the
"December Shares" and, together with the September Shares, the "Shares") of
common stock, $0.0001 par value, of the Company; and
WHEREAS, in connection with the purchase and sale of the December
Shares, the Company and the Investor desire to amend and restate the Investor
Rights Agreement to provide for the rights of the Investor with respect to the
registration of the December Shares according to the terms of this Agreement.
NOW THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:
1. DEFINITIONS.
1.1 The term "Commission" means the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
1.2 The term "Common Stock" means the common stock, par value
$0.0001 per share, of the Company, and excludes any securities convertible into,
exchangeable for or otherwise derivative of such Common Stock.
1.3 The term "Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar successor federal statute and the rules and
regulations thereunder, all as the same shall be in effect from time to time.
1.4 The term "Form S-3" means such form under the Securities Act as
in effect on the date hereof or any form for the registration of securities
subsequently adopted by the Commission in lieu of Form S-3 that permits the
inclusion or incorporation of information by reference to other documents filed
with the Commission.
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1.5 The term "Holder" means any person owning or having the right to
acquire Registrable Securities or any assignee thereof in accordance with
Section 9 hereof;
1.6 The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act, and the declaration or
ordering of effectiveness of such registration statement or document;
1.7 The term "Registrable Securities" means (i) the Shares and (ii)
Common Stock issued as a dividend or other distribution with respect to, or in
exchange for or in replacement of, the Shares, excluding in all cases, however,
any Registrable Securities sold by a person in a transaction in which such
person's registration rights are not assigned; provided, however, that any
shares previously sold to the public pursuant to a registered public offering or
pursuant to Rule 144 under the Securities Act shall cease to be Registrable
Securities.
1.8 The term "Securities Act" means the Securities Act of 1933, as
amended, or any similar successor federal statute and the rules and regulations
thereunder, all as the same shall be in effect from time to time.
1.9 All other capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Stock Purchase Agreement to which this
Exhibit A is attached.
2. DEMAND REGISTRATION ON FORM S-3.
2.1 If the Company shall receive a written request from the Holders
of at least 40% of the Registrable Securities then outstanding that the Company
file a registration statement under the Securities Act covering the registration
of at least 400,000 shares (as adjusted for stock splits, dividends and other
similar occurrences that may take place after the Closing Date) of Registrable
Securities, then the Company shall:
(i) promptly give written notice of the proposed registration to all
other Holders; and
(ii) as soon as practicable, subject to the limitations set forth in
this Section 2, use all reasonable efforts to effect such registration on Form
S-3 (including, without limitation, filing post-effective amendments,
appropriate qualifications under applicable blue sky or other state securities
laws, and appropriate compliance with the Securities Act) and as would permit or
facilitate the sale and distribution of all or such portion of such Registrable
Securities as are specified in such request, together with all or such portion
of the Registrable Securities of any Holder or Holders joining in such request
as are specified in a written request received by the Company within ten (10)
days after such written notice from the Company is mailed or delivered.
The Company shall not be obligated to effect, or to take any action to
effect, any such registration pursuant to this Section 2:
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(A) In any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification, or compliance, unless the
Company is already subject to service in such jurisdiction and except as
may be required by the Securities Act;
(B) After the Company has initiated two such registrations
pursuant to this Section 2; or
(C) During the period starting with the date sixty (60) days
prior to the Company's good faith estimate of the date of filing of, and
ending on a date one hundred eighty (180) days after the effective date
of, a Company-initiated registration (other than a registration of
securities with respect to an employee benefits plan); provided that the
Company is actively employing in good faith all reasonable efforts to
cause such registration statement to become effective;
2.2 Subject to clauses (A) through (C) of Section 2.1, the Company
shall file a Form S-3 registration statement covering the Registrable Securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders but in no event later than 20 calendar days
after receipt of the request required by the lead-in clause of the first
paragraph of Section 2.1; provided, however, that if (i) in the good faith
judgment of the Board of Directors of the Company, such registration would be
seriously detrimental to the Company and the Board of Directors of the Company
concludes, as a result, that it is essential to defer the filing of such
registration statement at such time, and (ii) the Company shall furnish to such
Holders a certificate signed by the President 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 registration statement to be filed
in the near future and that it is, therefore, essential to defer the filing of
such registration statement, then the Company shall have the right to defer such
filing for the period during which such disclosure would be seriously
detrimental, provided that (except as provided in clause (C) of Section 2.1) the
Company may not defer the filing for a period of more than sixty (60) days after
receipt of the request of the Holders, and, provided further, that the Company
shall not defer its obligation in this manner more than once in any twelve-month
period. The registration on Form S-3 pursuant to this Section 2 shall not be
underwritten, and such registration statement shall be kept effective no longer
than one hundred eighty (180) days. The registration statement filed pursuant to
this Section 2 may include, at the Company's election, securities of the Company
being sold for the account of the Company.
3. COMPANY REGISTRATION.
If (but without any obligation to do so) prior to the termination of the
Company's obligations hereunder as set forth in Section 10 hereof, the Company
proposes to register (including for this purpose a registration effected by the
Company for stockholders other than the Holders) any of its Common Stock under
the Securities Act in connection with a firmly underwritten public offering
solely of such Common Stock and solely for cash (other than a registration on
any form that does not include substantially the same
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information as would be required to be included in a registration statement
covering the sale of the Registrable Securities), the Company shall, at such
time, promptly give each Holder written notice of such registration. Upon the
written request of the Holder given within 10 days after mailing of such notice
by the Company in accordance with Section 11.2 of this Agreement, the Company
shall, subject to the provisions of Section 6 hereof, cause to be registered
under the Securities Act all of the Registrable Securities that each such Holder
has requested to be registered.
4. OBLIGATIONS OF THE COMPANY.
Whenever required under this Agreement to effect the registration of any
Registrable Securities, the Company shall, as expeditiously as reasonably
possible and subject to Section 2 hereof, as applicable:
4.1 Prepare and file with the Commission a registration statement
with respect to such Registrable Securities and use all reasonable efforts to
cause such registration statement to become effective.
4.2 Prepare and file with the Commission 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.
4.3 Furnish to the Holders covered by such registration statement
such numbers 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 such
Registrable Securities.
4.4 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 thereof, 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.
4.5 Except for registrations effectuated pursuant to Section 2.1,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
4.6 Notify each Holder 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.
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4.7 List, within 10 days after the date hereof, the Shares for
trading on the Nasdaq National Market.
4.8 Use all reasonable efforts to remain eligible to use Form S-3
for registration of its securities.
5. PROVISION OF INFORMATION.
It shall be a condition precedent to the obligations of the Company to
take any action pursuant to this Agreement 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 reasonably required to effect the registration of the
Registrable Securities.
6. EXPENSES.
The Company shall bear and pay all expenses incurred by the Company in
connection with any registration, filing or qualification of Registrable
Securities with respect to the registrations pursuant to Sections 2 and 3 hereof
for each Holder thereof (which right may be assigned as provided in Section 9
hereof), including (without limitation) all registration, filing and
qualification fees, printers' and accounting fees relating or apportionable
thereto, fees and disbursements of counsel for the Company, and of one counsel
to the selling Holders (not to exceed $10,000), blue sky fees and expenses,
including fees and disbursements of counsel related to all blue sky matters, the
expenses of providing materials pursuant to Section 4.3 hereof, but excluding
all underwriting discounts and commissions relating to Registrable Securities,
which shall be borne by the Holders; provided, however, that the Company shall
be required to bear and pay such expenses only with respect to the first two
registrations effected pursuant to Section 2. Notwithstanding the foregoing, the
Company shall not be required to pay for any expenses of any registration
proceeding begun pursuant to Section 2 if the registration request is
subsequently withdrawn at the request of the Holders of a majority of the
Registrable Securities to be registered (in which case all participating Holders
shall bear such expenses); provided, however, that if at the time of such
withdrawal, such Holders have learned of a material adverse change in the
condition, business or prospects of the Company from that known to such Holders
at the time of their request, then the Holders shall not be required to pay any
of such expenses and shall retain their rights pursuant to Section 2.
7. UNDERWRITING REQUIREMENTS.
In connection with any offering involving an underwriting of shares of
Common Stock, the Company shall not be required under Section 3 to include any
of the Holders' securities in such underwriting unless they accept the terms of
the underwriting as agreed upon between the Company and the underwriters
selected by it, and then only in such quantity as will not, in the opinion of
the underwriters, jeopardize the success of the offering by the Company. If the
total amount of securities, including Registrable Securities, requested by
stockholders to be included in such offering exceeds the amount
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of securities sold other than by the Company that the underwriters reasonably
believe compatible with the success of the offering, then the Company shall be
required to include in the offering only that number of such securities,
including Registrable Securities, which the underwriters believe will not
jeopardize the success of the offering. Subject to any contractual rights of
other selling stockholders, the securities so included shall be apportioned pro
rata among the selling stockholders according to the total amount of securities
entitled to be included therein owned by each selling stockholder or in such
other proportions as shall mutually be agreed to by such selling stockholders,
but in no event shall any shares being sold by a stockholder exercising a demand
registration right be excluded from such offering. For purposes of the preceding
parenthetical concerning apportionment, for any selling stockholder that is a
Holder of Registrable Securities and that is a partnership or corporation, the
partners, retired partners and stockholders of such Holder, or the estates and
family members of any such partners and retired partners and any trusts for the
benefit of any of the foregoing persons shall be deemed to be a single "selling
stockholder," and any pro rata reduction with respect to such "selling
stockholder" shall be based upon the aggregate amount of shares carrying
registration rights owned by all entities and individuals included in such
"selling stockholder," as defined in this sentence.
8. INDEMNIFICATION.
In the event any Registrable Securities are included in a registrations
statement under this Agreement:
8.1 To the extent permitted by law, the Company will indemnify and
hold harmless each Holder of such Registrable Securities, the officers and
directors of each such 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"): (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; and the
Company will reimburse each such Holder, 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 8.1 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 any such case for
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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 any such Holder, officer, director, underwriter or
controlling person.
8.2 To the extent permitted by law, each selling Holder (severally
but not jointly) will indemnify and hold harmless the Company, each of its
directors, each of its officers who have signed the registration statement, each
person, if any, who controls the Company within the meaning of the Securities
Act, any underwriter and any other Holder selling securities in such
registration statement or any of its directors or officers or any person who
controls such Holder, against any losses, claims, damages or liabilities to
which the Company or any such director, officer or underwriter or controlling
person, or other such Holder or director, officer or controlling person 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 expressly
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 controlling person,
other Holder, officer, director, or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this Section 8.2
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, that in no
event shall any indemnity under this Section 8.2 exceed the gross proceeds
received by such Holder from the sale of Registrable Securities as contemplated
hereunder.
8.3 Promptly after receipt by an indemnified party under this
Section 8 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 8, 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, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 8, 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 8.
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8.4 The obligations of the Company and Holders under this Section 8
shall survive the completion of any offering of Registrable Securities in a
registration statement under this Agreement, and otherwise.
9. ASSIGNMENT OF REGISTRATION RIGHTS.
The rights to cause the Company to register Registrable Securities
pursuant to this Agreement may be assigned by a Holder only to a transferee or
assignee who becomes the holder of three hundred thousand (300,000) shares of
Registrable Securities; provided, that the Company is, within a reasonable time
after such transfer, furnished with 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; and provided, further, that the rights
so assigned shall be effective only if the transferee or assignee continues to
be a wholly-owned subsidiary of a Holder.
10. TERMINATION OF REGISTRATION RIGHTS.
The Company's obligations pursuant to this Agreement shall terminate as
to any Holder of Registrable Securities on the earlier to occur of (i) the
second anniversary of the Closing Date as defined in the Stock Purchase
Agreement and (ii) such time when all Registrable Securities held by the Holder
may be sold pursuant to Rule 144 under the Securities Act during any three-month
period.
11. MISCELLANEOUS.
11.1 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
11.2 NOTICES. Unless otherwise provided, any notice, request, demand
or other communication required or permitted under this Agreement shall be given
in writing and shall be deemed effectively given upon personal delivery to the
party to be notified, or when sent by telecopier (with receipt confirmed and
promptly confirmed by personal delivery, U.S. first-class mail or carrier), or
overnight courier service, or upon deposit with the United States Post Office,
by registered or certified mail, postage prepaid and addressed as follows (or at
such other address as a party may designate by notice to the other):
If to the Company:
S3 Incorporated
0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: President
Telecopier: (000) 000-0000
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with a copy to:
Pillsbury Madison & Sutro LLP
0000 Xxxxxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. del Xxxxx, Esq.
Telecopier: (000) 000-0000
If to the Investor:
VIABASE, Inc. (BVI)
Xxxx Xxxxx Building
Wickhams Cay 1
P.O. Box 362
Road Town
Tortola, British Virgin Island
Attention: President
Telecopier: __________________
and to
Xxxxxx Xxxxxx White & XxXxxxxxx
000 Xxxxxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attention: Xxxxx X. X'Xxxx, Esq.
Telecopier: (000) 000-0000
11.3 WAIVERS. The observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) only with the written consent of the party against whom such
waiver is sought to be enforced. No waiver by either party of any default with
respect to any provision, condition or requirement hereof shall be deemed to be
a continuing waiver in the future thereof or a waiver of any other provision,
condition or requirement hereof; nor shall any delay or omission of either party
to exercise any right hereunder in any manner impair the exercise of any such
right accruing to it thereafter.
11.4 SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable, invalid or void by a court of competent jurisdiction,
such provision shall be excluded from this Agreement and the balance of this
Agreement shall be interpreted as if such provision were so excluded and shall
be enforceable in accordance with its terms.
11.5 ENTIRE AGREEMENT; AMENDMENTS.
(a) Except as otherwise provided herein or in the Stock Purchase
Agreement, this Agreement contains the entire understanding of the parties with
respect to the matters covered herein and supersedes all prior agreements and
understandings, written or oral, between the parties relating to the subject
matter hereof.
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(b) Any term of this Agreement may be amended and the observance of any
term of this Agreement 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 a majority of the Registrable
Securities then outstanding. Any amendment or waiver effected in accordance with
this paragraph shall be binding upon each holder of any Registrable Securities
then outstanding, each future holder of all such Registrable Securities, and the
Company.
11.6 GOVERNING LAW. This Agreement shall be governed by and construed
under the laws of the State of Delaware (irrespective of its choice of law
principles).
11.7 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
11.8 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement. Any reference in this Agreement to a
statutory provision or rule or regulation promulgated thereunder shall be deemed
to include any similar successor statutory provision or rule or regulation
promulgated thereunder.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
S3 INCORPORATED
By /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Name Xxxxxx X. Xxxxxx
------------------------------------
Title SR VP & CFO
-----------------------------------
VIABASE, INC. (BVI)
By /s/ Xxxxxxxx Xxxxx
--------------------------------------
Name Xxxxxxxx Xxxxx
------------------------------------
Title VP Operations
-----------------------------------
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