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EXHIBIT 4.08
NOMINATION AND OBSERVER AGREEMENT
THIS NOMINATION AND OBSERVER AGREEMENT is entered into as of June 25,
1997, by and between Excite, Inc., a California corporation (the "Company"), and
Intuit Inc., a Delaware corporation ("Intuit").
RECITALS
WHEREAS, Intuit acquired 2,900,000 shares of Common Stock of the
Company (the "Purchased Shares") pursuant to a Stock Purchase Agreement by and
between the Company and Intuit, dated June 11, 1997 (the "Stock Purchase
Agreement").
WHEREAS, as an inducement for Intuit to enter into the Stock Purchase
Agreement, the Company agreed to grant the director nomination and Board
observer rights to Intuit as contained herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the Company and Intuit agree as follows:
SECTION 1
DIRECTOR NOMINATION RIGHTS
1.1 Designee. For so long as Intuit continues to own at least ten
percent (10%) of the outstanding Common Stock of the Company (including shares
of Common Stock issuable upon conversion of outstanding shares of Preferred
Stock), the Company shall provide Intuit thirty (30) days prior written notice
of any shareholder solicitation or action relating to the election of directors.
After receipt of such notice, Intuit may, by written notice sent to the Company
within ten (10) days of receipt of such notice, request that the Company
nominate, and the Company shall nominate, for election to the Company's Board of
Directors (the "Board of Directors"), in connection with such shareholder
solicitation or action, one candidate designated by Intuit, who shall be
reasonably acceptable to the Company (the "Intuit Designee"). In the event that
Intuit shall desire to appoint an Intuit Designee otherwise than in connection
with a shareholder solicitation or action relating to the election of directors,
then as soon as practicable upon written notice from Intuit, the Company shall
appoint an Intuit Designee to the Board of Directors.
1.2 Affiliates. For purposes of this Agreement, all shares held by an
affiliate (as defined in Rule 405 promulgated under the Securities Act of 1933,
as amended) of Intuit, will be deemed to be owned by Intuit.
1.3 Voting of Management Shares. The Company shall use its best efforts
(i) to cause to be voted the shares for which the Company's management or the
Board of Directors holds proxies or is otherwise entitled to vote in favor of
the election of the Intuit Designee nominated
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pursuant to this Agreement; and (ii) to cause the Board of Directors to
unanimously recommend to its shareholders to vote in favor of the Intuit
Designee.
1.4 Vacancies. In the event that any Intuit Designee shall cease to
serve as a director of the Company for any reason, the vacancy resulting
therefrom shall be filled by another Intuit Designee.
1.5 Equal Treatment. The Company shall provide the same compensation
and rights and benefits of indemnity to the Intuit Designee as are provided to
other non-employee directors.
SECTION 2
OBSERVER RIGHTS
2.1. Observer Rights. For so long as Intuit continues to own at least
ten percent (10%) of the outstanding Common Stock of the Company (including
shares of Common Stock issuable upon conversion of outstanding shares of
Preferred Stock) and an Intuit Designee is not a member of the Board of
Directors, the Company shall invite a representative of Intuit (the
"Representative"), which Representative shall be reasonably acceptable to the
Company, to attend all meetings of the Board of Directors and the audit
committee thereof in a non-voting observer capacity and, in this respect, shall
give such Representative copies of all notices, minutes, consents and other
Board of Directors' or audit committee members' materials that it provides to
all of its directors or to its audit committee members (as appropriate);
provided, however, (i) that the Company reserves the right to withhold any
information and to exclude such Representative from any meeting, or any portion
thereof, as is reasonably determined by the Chairman of the Board or a majority
of the members of the Board of Directors or the audit committee thereof (in the
case of audit committee meetings) to be necessary for purposes of
confidentiality, competitive factors, attorney-client privilege or other
reasonable purposes; and (ii) that in no event shall the failure to provide the
notice described above invalidate in any way any action taken at a meeting of
the Board of Directors or any meeting of the audit committee thereof.
2.2 Confidentiality. Intuit agrees, and Intuit will cause any
Representative of Intuit to agree, to hold in confidence with respect to all
information so provided and not use or disclose any confidential information
provided to or learned by it in connection with its rights under this letter
other than for purposes reasonably related to Intuit's interest as a shareholder
of the Company, and not to the detriment of, the Company. The confidentiality
provisions hereof will survive any termination of this Agreement.
SECTION 3
MISCELLANEOUS
3.1 Termination. This Agreement shall terminate and have no further
force or effect at such time as Intuit ceases to hold at least ten percent (10%)
of the outstanding Common Stock (including shares of Common Stock issuable upon
conversion of outstanding shares of Preferred Stock) of the Company.
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3.2 Specific Enforcement. It is agreed and understood that monetary
damages would not adequately compensate Intuit for the breach of this Agreement
by the Company, that this Agreement shall be specifically enforceable, and that
any breach or threatened breach of this Agreement shall be the proper subject of
a temporary or permanent injunction or restraining order. Further, the Company
waives any claim or defense that there is an adequate remedy at law for such
breach or threatened breach.
3.3 Assignment. This Agreement and the rights granted to Intuit
hereunder are personal to Intuit and may not be assigned to any other person;
provided, however, that this Agreement and all of the rights granted to Intuit
hereunder may be assigned to (i) a purchaser in a private, block sale
transaction of all of the shares of Common Stock of the Company held by Intuit,
which purchaser is reasonably acceptable to the Company or (ii) any party who
acquires ownership or control of Intuit through a merger, consolidation, sale of
assets or similar business combination (either such party is referred to as an
"Assignee"); provided, further, that any Assignee expressly agrees in writing to
be bound by the standstill provisions and resale restrictions contained in
Sections 4.5 and 4.6 of the Stock Purchase Agreement.
3.4 Successors and Assigns. Except as otherwise expressly 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.
3.5 Governing Law. This Agreement shall be governed by and construed
under the internal laws of the State of California as applied to agreements
among California residents entered into and to be performed entirely within
California, without reference to principles of conflict of laws or choice of
laws.
3.6 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.
3.7 Headings. The headings and captions used in this Agreement are used
for convenience only and are not to be considered in construing or interpreting
this Agreement. All references in this Agreement to sections, paragraphs,
exhibits and schedules shall, unless otherwise provided, refer to sections and
paragraphs hereof and exhibits and schedules attached hereto, all of which
exhibits and schedules are incorporated herein by this reference.
3.8 Notices. Unless otherwise provided, any notice 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 upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified in the case of the
Company, at 000 Xxxxxxxx, Xxxxxxx Xxxx, Xxxxxxxxxx 00000, attention: General
Counsel, with a copy to Xxxx X. Xxxxxxx, Xxxxxxx & West LLP, Two Palo Xxxx
Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, or in the case of Intuit, at 0000
Xxxxxxxxxxx Xxxx, Xxxx Xxxx, Xxxxxxxxxx 00000, attention: Treasurer, with a copy
to: General Counsel, or at such other address as any party may designate by
giving ten (10) days advance written notice to the other party.
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3.9 Amendments and Waivers. 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 Intuit.
3.10 Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, such provision(s) shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision(s) were so excluded and shall be enforceable in accordance with
its terms.
3.11 Entire Agreement. This Agreement constitutes the entire agreement
and understanding of the parties with respect to the subject matter hereof and
supersedes any and all prior negotiations, correspondence, agreements,
understandings, duties or obligations between the parties with respect to the
subject matter hereof.
3.12 Further Assurances. From and after the date of this Agreement,
upon the request of Intuit or the Company, the Company and Intuit shall execute
and deliver such instruments, documents or other writings as may be reasonably
necessary or desirable to confirm and carry out and to effectuate fully the
intent and purposes of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
THE COMPANY INTUIT
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EXCITE, INC., INTUIT INC.,
a California corporation a Delaware corporation
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxxxxx Xxxxxx
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Title: Executive VP, CAO/CFO Title: Exec. VP
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[SIGNATURE PAGE TO NOMINATION AND OBSERVER AGREEMENT]
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