EXHIBIT 10.18
CKS GROUP, INC. HOLDER AGREEMENT
THIS CKS GROUP, INC. HOLDER AGREEMENT ("Agreement") dated as of
September 1, 1998, among USWeb Corporation, a Delaware corporation ("USWeb"),
the undersigned stockholder ("Holder") of CKS Group, Inc., a Delaware
corporation ("CKS") and CKS.
RECITALS
USWeb and CKS have entered into an Agreement and Plan of Reorganization
("Merger Agreement") dated September 1, 1998 pursuant to which a subsidiary of
USWeb will merge with and into CKS ("Merger"), and CKS will become a subsidiary
of USWeb (capitalized terms not otherwise defined herein shall have the meanings
ascribed to them in the Merger Agreement).
Pursuant to the Merger, at the Effective Time outstanding shares of CKS
Common Stock, including any shares owned by Holder, will be converted into the
right to receive shares of Common Stock of USWeb.
It is intended that the Merger will constitute a reorganization within
the meaning of Section 368(a) of the Internal Revenue Code of 1986 as amended
(the "Code"), and that it will be a condition to effectiveness of the Merger
that legal counsel for each of CKS and USWeb will have delivered written
opinions to such effect.
Holder has been advised that Holder may be deemed to be an "affiliate"
of CKS, as the term "affiliate" is used (i) for purposes of paragraphs (c) and
(d) of Rule 145 of the Rules and Regulations (the "Rules and Regulations") of
the Securities and Exchange Commission (the "Commission") and (ii) in the
Commission's Accounting Series Releases 130 and 135, as amended, although
nothing contained herein shall be construed as an admission by Holder that
Holder is in fact an affiliate of CKS.
NOW, THEREFORE, intending to be legally bound, the parties hereby agree
as follows:
1. Acknowledgments by Holder. Holder acknowledges and understands
-------------------------
that the covenants by Holder set forth herein will be relied upon by USWeb, CKS,
and their respective accountants and counsel.
2. Compliance with Rule 145 and the Securities Act.
-----------------------------------------------
(a) Holder has been advised that (i) the issuance of shares of
USWeb Common Stock in connection with the Merger is expected to be effected
pursuant to a Registration Statement on Form S-4 to be filed to register the
shares of USWeb Common Stock under the Securities Act of
1933, as amended (the "Securities Act"), and as such will not be deemed
"restricted securities" within the meaning of Rule 144 promulgated under the
Securities Act, and resale of such shares will not be subject to any
restrictions other than as set forth in Rule 145 under the Securities Act (which
will not apply if such shares are otherwise transferred pursuant to an effective
registration statement under the Securities Act or an appropriate exemption from
registration), and (ii) Holder may be deemed to be an affiliate of CKS. Holder
accordingly agrees not to sell, transfer or otherwise dispose of any USWeb
Common Stock issued to Holder in the Merger unless (i) such sale, transfer or
other disposition is made in conformity with the requirements of Rule 145(d)
promulgated under the Securities Act, or (ii) such sale, transfer or other
disposition is made pursuant to an effective registration statement under the
Securities Act or an appropriate exemption from registration, or (iii) Holder
delivers to USWeb a written opinion of counsel, reasonably acceptable to USWeb
in form and substance, that such sale, transfer or other disposition is
otherwise exempt from registration under the Securities Act.
(b) USWeb will give stop transfer instructions to its transfer
agent with respect to any USWeb Common Stock received by Holder pursuant to the
Merger and there will be placed on the certificates representing such Common
Stock, or any substitutions therefor, a legend stating in substance:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 APPLIES AND MAY ONLY BE
TRANSFERRED IN CONFORMITY WITH RULE 145(d) OR PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR IN ACCORDANCE WITH A WRITTEN OPINION OF
COUNSEL, REASONABLY ACCEPTABLE TO THE ISSUER IN FORM AND
SUBSTANCE, THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED."
The legend set forth above shall be removed (by delivery of a substitute
certificate without such legend) and USWeb shall so instruct its transfer agent,
if Holder delivers to USWeb (i) satisfactory written evidence that the shares
have been sold in compliance with Rule 145 (in which case, the substitute
certificate will be issued in the name of the transferee), or (ii) an opinion of
counsel, in form and substance reasonably satisfactory to USWeb, to the effect
that public sale of the shares by the holder thereof is no longer subject to
Rule 145.
3. Covenants Related to Pooling of Interests. During the period
-----------------------------------------
prescribed by Staff Bulletin No. 65, Holder will not sell, exchange, transfer,
pledge, distribute, make any gift or otherwise dispose of or grant any option,
establish any "short" or put-equivalent position with respect to or enter into
any similar transaction (through derivatives or otherwise) intended to reduce or
having the effect, directly or indirectly, of reducing Holder's risk relative to
any shares of CKS Common Stock, or shares of USWeb Common Stock beneficially
owned presently or subsequently
-2-
acquired. USWeb may, at its discretion, cause a restrictive legend relating to
the foregoing effect to be placed on USWeb Common Stock certificates issued to
Holder in the Merger and place a stop transfer notice consistent with the
foregoing with its transfer agent with respect to the certificates.
USWeb agrees to use its commercially reasonable best efforts to publish,
in accordance with ASR 135 and other applicable accounting rules, as promptly as
practicable following the Merger, consolidated financial results covering at
least 30 days of post-Merger combined operations of USWeb and CKS.
Notwithstanding anything to the contrary in this Agreement, Holder may
sell or dispose of up to 10% of its shares of CKS Common Stock held as of
September 1, 1998; provided that the aggregate amount of shares of CKS Common
Stock sold or disposed of by all affiliates of CKS from the date of this
Agreement through the date the combined company first publishes earnings results
for a period including at least 30 days of combined operations does not exceed a
number of shares equal to one percent (1%) of (i) the outstanding shares of CKS
Common Stock as of September 1, 1998 plus (ii) the number of shares subject to
outstanding warrants and options (calculated on the "treasury method") as of
that date, such shares to be allocated 125,000 to The Interpublic Group of
Companies, Inc. and the remainder to all other affiliates of CKS. Shares sold by
Holder pursuant to the immediately preceding sentence shall be excluded from the
voting obligations under the CKS Voting Agreement dated as of September 1, 1998
between USWeb Corporation and Holder and shall be excluded from the Irrevocable
Proxy delivered by Holder to USWeb Corporation pursuant to such voting
agreement. Upon the Effective Time, the registration rights granted to The
Interpublic Group of Companies, Inc. in the Shareholder Rights Agreement dated
January 27, 1995 shall terminate automatically and without further action by the
parties hereto and thereto.
With respect to shares of USWeb Common Stock received by Holder pursuant
to the Merger, if Holder is unable to sell such shares pursuant to SEC Rule 145
in any calendar quarter, the Holder shall be entitled to registration rights on
a pari passu basis with the rights of Holders under the USWeb Corporation
Amended and Restated Investor Rights Agreement dated November 7, 1998, a copy of
which is attached hereto. Such registration rights shall expire two years
subsequent to the Effective Time of the Merger.
4. Beneficial Ownership of Stock. Except for USWeb Common Stock and
-----------------------------
CKS Common Stock and warrants and options to purchase USWeb or CKS Common Stock
set forth below the signatures below, Holder does not beneficially own any
shares of USWeb or CKS Common Stock or any other equity securities of USWeb or
CKS or any options, warrants or other rights to acquire any equity securities of
USWeb or CKS.
5. Miscellaneous.
-------------
(a) For the convenience of the parties hereto, this Agreement
may be executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same document.
-3-
(b) This Agreement shall be enforceable by, and shall inure to
the benefit of and be binding upon, the parties hereto and their respective
successors and assigns. As used herein, the term "successors and assigns" shall
mean, where the context so permits, heirs, executors, administrators, trustees
and successor trustees, and personal and other representatives.
(c) This Agreement shall be governed by and construed,
interpreted and enforced in accordance with the internal laws of the State of
Delaware.
(d) If a court of competent jurisdiction determines that any
provision of this Agreement is not enforceable or enforceable only if limited in
time or scope, this Agreement shall continue in full force and effect with such
provision stricken or so limited.
(e) Counsel to the parties to the Agreement shall be entitled to
rely upon this Agreement as appropriate.
(f) This Agreement shall not be modified or amended, or any
right hereunder waived or any obligation excused, except by a written agreement
signed by both parties.
-4-
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
set forth on the first page of this Agreement.
CKS GROUP, INC. USWEB CORPORATION
By:________________________ By:________________________
Title:_____________________ Title:_____________________
HOLDER
By:________________________________
Name of Holder:____________________
Name of Signatory (if different
from name of Holder):______________
Title of Signatory
(if applicable):___________________
CKS shares beneficially owned: USWeb shares beneficially owned:
________ shares of Common Stock ___________ shares of Common Stock
CKS shares subject to outstanding: USWeb shares subject to outstanding
options:
options: ________ shares of Common _______________ shares of Common Stock
Stock
***CKS GROUP, INC. HOLDER AGREEMENT***
