EXHIBIT 10.29
XXXXXXX.XXX, INC.
FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
January 18, 2000
Table of Contents
1. Registration Rights......................................................................... 2
1.1 Definitions........................................................................ 2
1.2 Request for Registration........................................................... 4
1.3 Company Registration............................................................... 5
1.4 Form S-3 Registration.............................................................. 5
1.5 Obligations of the Company......................................................... 6
1.6 Furnish Information................................................................ 8
1.7 Expenses of Registration........................................................... 8
1.8 Underwriting Requirements.......................................................... 9
1.9 Delay of Registration.............................................................. 9
1.10 Indemnification.................................................................... 9
1.11 Reports Under Securities Exchange Act of 1934...................................... 12
1.12 Assignment of Registration Rights.................................................. 12
1.13 Limitations on Subsequent Registration Rights...................................... 13
1.14 "Market Stand-Off" Agreement 13
1.15 Termination of Registration Rights................................................. 13
2. Covenants of the Company.................................................................... 14
2.1 Delivery of Year-End Financial Statements.......................................... 14
2.2 Delivery of Additional Financial Information....................................... 14
2.3 Inspection......................................................................... 14
2.4 Right of First Offer............................................................... 14
2.5 Board Observer Rights.............................................................. 16
2.6 IPO Participation Rights........................................................... 16
2.7 Termination of Covenants........................................................... 17
3. Miscellaneous............................................................................... 18
3.1 Successors and Assigns............................................................. 18
3.2 Amendments and Waivers............................................................. 18
3.3 Notices............................................................................ 19
3.4 Severability....................................................................... 19
3.5 Governing Law...................................................................... 19
3.6 Counterparts....................................................................... 19
3.7 Titles and Subtitles............................................................... 19
3.8 Aggregation of Stock............................................................... 19
3.9 Entire Agreement: Amendments and Waivers........................................... 19
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XXXXXXX.XXX, INC.
FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
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This Fourth Amended and Restated Investors' Rights Agreement (the
"Agreement") is made and entered into as of January 18, 2000, by and among
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Xxxxxxx.xxx, Inc., a Delaware corporation (the "Company"), the undersigned
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holders of the capital stock of the Company, and those other persons and
entities who have or shall have executed this Agreement and whose names appear
on the Schedule of Investors' Rights Holders attached hereto as Exhibit A
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(collectively, the "Investors"), as such Schedule may be amended from time to
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time pursuant to Section 1.13 hereof.
RECITALS
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A. The Company has issued and sold shares of its Series A, Series B,
Series C and Series D Preferred Stock to certain persons and entities whose
names appear on the Schedule of Investors' Rights Holders attached hereto as
Exhibit A, and in consideration thereof, has granted to such Investors and
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certain other stockholders certain rights pursuant to a Third Amended and
Restated Investors' Rights Agreement dated as of November 29, 1999 (the
"November 1999 Agreement").
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B. In connection with that certain Amendment to Series D Stock Purchase
Agreement dated as of January 21, 2000, the Company will sell shares of Series D
Preferred Stock to additional investors (the "Additional Investors"). In
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connection with that certain Agreement and Plan of Merger, dated as of December
29, 1999, by and among the Company, ICOD Acquisition Corp., a Delaware
corporation and wholly-owned subsidiary of the Company ("Petopia Sub"), and C/R
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Catalog Corp., a Delaware corporation ("ICOD"), pursuant to which ICOD will be
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merged with and into Petopia Sub (the "Merger"), the Company will issue shares
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of the Company's Series E Preferred Stock to the stockholders of ICOD (the
"Series E Investors"). A condition to the consummation of the Merger is that
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the Company, the Founders and the Investors enter into this Agreement in order
to provide the Series E Investors with, among other things, rights comparable to
those granted to the Investors in the November 1999 Agreement. Accordingly, the
Company, the Founders, and the Investors desire to amend and restate the
November 1999 Agreement, and add the Additional Investors and the Series E
Investors as parties to this Agreement. For purposes of this Agreement, the term
"Investors" shall include the Additional Investors and the Series E Investors.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
promises and covenants contained herein, the parties hereto agree to amend and
restate the November 1999 Agreement as follows:
AGREEMENT
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1. Registration Rights. The Company, the Founders and the Investors
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covenant and agree as follows:
1.1 Definitions. For purposes of this Section 1:
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(a) The terms "register," "registered," and "registration" refer
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to a registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and the declaration or ordering of effectiveness of such
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registration statement or document;
(b) The term "Registrable Securities" means (i) the shares of
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Common Stock issuable or issued upon conversion of the Series A Preferred Stock,
the Series B Preferred Stock, the Series C Preferred Stock, the Series D
Preferred Stock, and the Series E Preferred Stock (including the shares of
Series A Preferred Stock issuable or issued upon the exercise of warrants to
purchase shares of Series A Preferred Stock, the shares of Series C Preferred
Stock issuable or issued upon the exercise of warrants to purchase shares of
Series C Preferred Stock, the shares of Series D Preferred Stock issuable or
issued upon the exercise of warrants to purchase shares of Series D Preferred
Stock and the shares of Series E Preferred Stock issuable or issued upon the
exercise of warrants to purchase shares of Series E Preferred Stock issuable or
issued to Greyrock Capital, a division of Banc of America Commercial Finance
Corporation) (collectively, the "Preferred Stock"), (ii) the shares of Common
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Stock issuable or issued upon the exercise of warrants to purchase shares of
Common Stock issuable or issued to National Broadcasting Company, Inc., (iii)
the shares of Common Stock issued to the Founders (the "Founders' Stock"),
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provided, however, that for the purposes of Section 1.2, 1.4 or 1.13 the
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Founders' Stock shall not be deemed Registrable Securities and the Founders
shall not be deemed Holders, (iv) the shares of Common Stock issuable or issued
to Xxxxx Xxxxxxxxxxx and Xxxxxx Xxxxxxxxxxx (each, a "Loveland Affiliate" and
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together, the "Loveland Affiliates"), provided, however, that for the purposes
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of Section 1.2, 1.4 or 1.13, shares of Common Stock held by the Loveland
Affiliates shall not be deemed Registrable Securities and the Loveland
Affiliates shall not be deemed Holders, and (v) any other shares of Common Stock
of the Company issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of, the
shares listed in (i), (ii) and (iii); provided, however, that the foregoing
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definition shall exclude in all cases any Registrable Securities sold by a
person in a transaction in which his or her rights under this Agreement are not
assigned. Notwithstanding the foregoing, Common Stock or other securities shall
only be treated as Registrable Securities if and so long as they have not been
(A) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction, or (B) sold in a transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act under Section 4(1) thereof so that all transfer restrictions, and
restrictive legends with respect thereto, if any, are removed upon the
consummation of such sale;
(c) The number of shares of "Registrable Securities then
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outstanding" shall be determined by the number of shares of Common Stock
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outstanding which are, and the
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number of shares of Common Stock issuable pursuant to then exercisable or
convertible securities which are, Registrable Securities;
(d) The term "Holder" means any person owning or having the
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right to acquire Registrable Securities or any transferee or assignee thereof in
accordance with Section 1.12 of this Agreement;
(e) The term "Form S-3" means such form under the Securities Act
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as in effect on the date hereof or any successor form under the Securities Act;
(f) The term "SEC" means the Securities and Exchange Commission;
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and
(g) The term "Qualified IPO" means a firm commitment
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underwritten public offering of the Company's Common Stock pursuant to an
effective registration statement under the Securities Act, at an offering price
of not less than $8.40915 per share (as adjusted for stock splits, stock
dividends, recapitalization and the like) with aggregate gross proceeds to the
Company of not less than $20,000,000 (net of underwriting discounts and
commissions).
(h) The term "Founders" means the individuals and entities
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listed under the caption "Founders" on Exhibit A hereto.
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(i) The term "Affiliated Entity" means an entity that is a
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partner or retired partner of any Holder that is a partnership; a member of any
Holder that is a limited liability company; a stockholder of any Holder that is
a corporation; an entity that controls, is controlled by or is under common
control (including related funds under common investment management) with any
Holder; a spouse, ancestor, lineal descendant or sibling of any Holder that is a
natural person; or a trust established for the benefit of any Holder that is a
natural person, or for the benefit of a spouse, ancestor, lineal descendant or
sibling of any such Holder.
1.2 Request for Registration.
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(a) If at any time after six (6) months following the closing of
a firm commitment underwritten public offering of the Company's Common Stock
pursuant to an effective registration statement under the Securities Act (an
"IPO"), the Company shall receive a written request from the Holders of at least
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a majority of the Registrable Securities then outstanding that the Company file
a registration statement under the Securities Act covering the registration of
at least 30% of the Registrable Securities then outstanding, the anticipated
aggregate offering price, net of underwriting discounts and commissions, of
which would equal or exceed $5,000,000, then the Company shall, within ten (10)
days of the receipt thereof, give written notice of such request to all Holders
and shall use commercially reasonable efforts to effect as soon as practicable,
and in any event within sixty (60) days of the receipt of such request, the
registration under the Securities Act of all Registrable Securities which the
Holders request to be registered within twenty (20) days of the mailing of such
notice by the Company in accordance with Section 3.3.
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(b) If the Holders initiating the registration request hereunder
("Initiating Holders") intend to distribute the Registrable Securities covered
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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 1.2 and the Company
shall include such information in the written notice referred to in subsection
1.2(a). The underwriter will be selected by the Company and shall be reasonably
acceptable to a majority in interest of the Initiating Holders. In such event,
the right of any Holder to include his 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
(together with the Company as provided in subsection 1.5(e)) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting. Notwithstanding any other provision of this
Section 1.2, if the underwriter advises the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the Initiating Holders shall so advise all Holders of
Registrable Securities which would otherwise be underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities of the Company then owned by each Holder; provided,
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however, that the number of shares of Registrable Securities to be included in
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such underwriting shall not be reduced unless all other securities are first
entirely excluded from the underwriting.
(c) Notwithstanding the foregoing, if the Company shall furnish
to Holders requesting a registration statement pursuant to this Section 1.2, 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 and its shareholders for such registration statement
to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer such filing
for a period of not more than one hundred twenty (120) days after receipt of the
request of the Initiating Holders; provided, however, that the Company may not
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utilize this right more than once in any twelve-month period.
(d) In addition, the Company shall not be obligated to effect,
or to take any action to effect, any registration pursuant to this Section 1.2:
(i) After the Company has effected two (2) registrations
pursuant to this Section 1.2 and such registrations have been declared or
ordered effective; provided however, that if after eighteen (18) months
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following the closing of the Company's IPO, Form S-3 is not available for
offerings by the Holders pursuant to a request made pursuant to Section 1.4
below, the Company shall be obligated to effect no more than three (3)
registrations pursuant to this Section 1.2;
(ii) During the period starting with the date thirty (30)
days prior to the Company's good faith estimate of the date of filing of, and
ending on a date ninety (90) days after the effective date of any registration
pertaining to securities of the Company,
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subject to Section 1.3 hereof; provided that the Company is actively employing
in good faith all reasonable efforts to cause such registration statement to
become effective; or
(iii) If the Initiating Holders propose to dispose of
shares of Registrable Securities that may be immediately registered on Form S-3
pursuant to a request made pursuant to Section 1.4 below.
1.3 Company Registration. If (but without any obligation to do so)
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the Company proposes to register (including for this purpose a registration
effected by the Company for shareholders other than the Holders) any of its
stock under the Securities Act in connection with the public offering of such
securities solely for cash (other than a registration relating solely to the
sale of securities to participants in a Company stock plan or a transaction
covered by Rule 145 under the Securities Act, a registration in which the only
stock being registered is Common Stock issuable upon conversion of debt
securities which are also being registered, or any registration on any form
which does not include substantially the same 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 each Holder given
within twenty (20) days after mailing of such notice by the Company in
accordance with Section 3.3, the Company shall, subject to the provisions of
Section 1.8, cause to be registered under the Securities Act all of the
Registrable Securities that each such Holder has requested to be registered.
1.4 Form S-3 Registration. In case the Company shall receive from
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any Holder or Holders of a written request or requests that the Company effect a
registration on Form S-3 and any related qualification or compliance with
respect to 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; 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 Holder's
or 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
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
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registration, qualification or compliance, pursuant to this Section 1.4: (i) if
Form S-3 is not available for such offering by the Holders; (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 (net of any
underwriters' discounts or commissions) of less than $500,000; (iii) if the
Company shall furnish to the 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 and its
shareholders 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 period of not more than sixty
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(60) days after receipt of the request of the Holder or Holders under this
Section 1.4; provided, however, that the Company shall not utilize this right
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more than once in any twelve (12) month period; (iv) if the Company has, within
the twelve (12) month period preceding the date of such request, already
effected two (2) registrations on Form S-3 for the Holders pursuant to this
Section 1.4; (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; or (vi)
during the period ending six (6) months after the effective date of a
registration statement subject to Section 1.3.
(c) Subject to the foregoing, the Company shall file a
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. Registrations effected pursuant to this
Section 1.4 shall not be counted as demands for registration or registrations
effected pursuant to Sections 1.2 or 1.3, respectively.
1.5 Obligations of the Company. Whenever required under this Section
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1 to effect the registration of any Registrable Securities, the Company shall,
as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best 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 until the distribution described in the
registration statement has been completed. The Company shall not be required to
file, cause to become effective or maintain the effectiveness of any
registration statement that contemplates a distribution of securities on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act.
(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 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 Registrable
Securities owned by them.
(d) Use its best 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
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condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(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
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managing underwriter 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) Cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar securities
issued by the Company are then listed.
(h) Provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration.
(i) Use its best efforts to furnish, at the request of any
Holder requesting registration of Registrable Securities pursuant to this
Section 1, on the date that such Registrable Securities are delivered to the
underwriters for sale in connection with a registration pursuant to this Section
1, 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 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 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 to the Holders
requesting registration of Registrable Securities.
1.6 Furnish Information. It shall be a condition precedent to the
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obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities. The Company shall have no obligation with respect to any
registration requested pursuant to Section 1.2 or Section 1.4 of this Agreement
if, as a result of the application of the preceding sentence, the number of
shares or the anticipated aggregate offering price of the Registrable Securities
to be included in the registration does not equal or exceed the number of shares
or the anticipated aggregate offering price required to originally trigger the
Company's obligation to initiate such registration as specified in subsection
1.2(a) or subsection 1.4(b)(ii), whichever is applicable.
1.7 Expenses of Registration.
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(a) Demand Registration. All expenses other than underwriting
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discounts and commissions incurred in connection with registrations, filings or
qualifications pursuant to Section 1.2, including (without limitation) all
registration, filing and qualification fees, printers' and accounting fees, fees
and disbursements of counsel for the Company and the reasonable fees and
disbursements of one counsel for the selling Holders (not to exceed $20,000)
selected by them with the approval of the Company, which approval shall not be
unreasonably withheld, shall be borne by the Company; provided, however, that
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the Company shall not be required to pay for any expenses of any registration
proceeding begun pursuant to Section 1.2 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), unless the Holders of a majority of the Registrable
Securities agree to forfeit their right to one demand registration pursuant to
Section 1.2; provided, however, that if at the time of such withdrawal, the
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Holders have learned of a material adverse change in the condition, business or
prospects of the Company from that known to the Holders at the time of their
request and have withdrawn the request with reasonable promptness following
disclosure by the Company of such material adverse change, then the Holders
shall not be required to pay any of such expenses and shall retain their rights
pursuant to Section 1.2.
(b) Company Registration. All expenses other than underwriting
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discounts and commissions incurred in connection with registrations, filings or
qualifications of Registrable Securities pursuant to Section 1.3 for each Holder
(which right may be assigned as provided in Section 1.12), including (without
limitation) all registration, filing and qualification fees, printers' and
accounting fees, fees and disbursements of counsel for the Company and the
reasonable fees and disbursements of one counsel for the selling Holder or
Holders (not to exceed $20,000) selected by them with the approval of the
Company, which approval shall not be unreasonably withheld, shall be borne by
the Company.
(c) Registration on Form S-3. All expenses incurred in
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connection with a registration requested pursuant to Section 1.4, including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees and the reasonable fees and disbursements of one counsel for
the selling Holder or Holders (not to exceed $20,000) selected by them with the
approval of the Company, which approval shall not be unreasonably withheld, and
counsel for the Company, and any underwriters' discounts or commissions
associated with Registrable Securities, shall be borne by the Company.
1.8 Underwriting Requirements. In connection with any offering
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involving an underwriting of shares of the Company's capital stock, the Company
shall not be required under Section 1.3 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 (or by
other persons entitled to select the underwriters), and then only in such
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company. If the total amount of
securities, including Registrable Securities, requested by shareholders to be
included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole discretion is
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
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determine in their sole discretion will not jeopardize the success of the
offering (the securities so included to be apportioned pro rata among the
selling shareholders according to the total amount of securities entitled to be
included therein owned by each selling shareholder or in such other proportions
as shall mutually be agreed to by such selling shareholders) but in no event
shall (i) the amount of securities of the selling Holders included in the
offering be reduced below thirty percent (30%) of the total amount of securities
included in such offering, unless such offering is the IPO, in which case the
selling shareholders may be excluded if the underwriters make the determination
described above or (ii) any securities held by the Founders and by the Loveland
Affiliates be included if any securities held by any selling Holder (other than
the Founders or Loveland Affiliates) are excluded. For purposes of the preceding
parenthetical concerning apportionment, for any selling shareholder which is a
Holder of Registrable Securities and which is a partnership or corporation, the
partners, retired partners and shareholders 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
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shareholder," and any pro-rata reduction with respect to such "selling
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shareholder" shall be based upon the aggregate amount of shares carrying
registration rights owned by all entities and individuals included in such
"selling shareholder," as defined in this sentence.
1.9 Delay of Registration. No Holder shall have any right to obtain
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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 1.
1.10 Indemnification. In the event any Registrable Securities are
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included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless 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 Securities Exchange
Act of 1934, as amended (the "Exchange Act"), against any losses, claims,
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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
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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 pay to
each such Holder, underwriter or controlling person, as incurred, 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,
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that the indemnity agreement contained in this subsection 1.10(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
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unreasonably withheld), nor shall the Company be liable to any Holder,
underwriter or controlling person 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 any such Holder,
underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act, any underwriter,
any other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages, or liabilities (joint or several) to which any of the foregoing
persons 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 pay, as incurred, any legal or other expenses reasonably incurred by
any person intended to be indemnified pursuant to this subsection 1.10(b), in
connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
-------- -------
in this subsection 1.10(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, that in no event shall any indemnity under this subsection
--------
1.10(b) exceed the net proceeds from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 1.10 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 1.10, 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
-------- -------
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the reasonable 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
1.10, 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 1.10.
(d) If the indemnification provided for in this Section 1.10 is
held by a court of competent jurisdiction to be unavailable to an indemnified
party with respect to any loss,
-10-
liability, claim, damage or expense referred to therein, then the indemnifying
party, in lieu of indemnifying such indemnified party hereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such loss, liability, claim, damage, or expense 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 statements
or omissions that resulted in such loss, liability, claim, damage or expense as
well as any other relevant equitable considerations; provided, that in no event
--------
shall any contribution by a Holder under this Subsection 1.10(d) exceed the net
proceeds from the offering received by such Holder. The relative fault of the
indemnifying party and of the indemnified party shall be determined 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.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
(f) The obligations of the Company and Holders under this
Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.11 Reports Under Securities Exchange Act of 1934. With a view to
---------------------------------------------
making available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration or pursuant to a registration on Form S-3, the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in SEC Rule 144, at all times after ninety (90) days
after the effective date of the first registration statement filed by the
Company for the offering of its securities to the general public so long as the
Company remains subject to the periodic reporting requirements under Sections 13
or 15(d) of the Exchange Act;
(b) take such action, including the voluntary registration of
its Common Stock under Section 12 of the Exchange Act, as is necessary to enable
the Holders to utilize Form S-3 for the sale of their Registrable Securities,
such action to be taken as soon as practicable after the end of the fiscal year
in which the first registration statement filed by the Company for the offering
of its securities to the general public is declared effective;
(c) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(d) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied
-11-
with the reporting requirements of SEC Rule 144 (at any time after ninety (90)
days after the effective date of the first registration statement filed by the
Company), the Securities Act and the Exchange Act (at any time after it has
become subject to such reporting requirements), or that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any time
after it so qualifies), (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the
Company, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.
1.12 Assignment of Registration Rights. The rights to cause the
---------------------------------
Company to register Registrable Securities pursuant to this Section 1 may be
assigned (but only with all related obligations) by a Holder to a transferee or
assignee (i) of not less than 100,000 shares of Registrable Securities (as
adjusted for stock splits, stock dividends, recapitalization and the like), or
(ii) that is an Affiliated Entity of such Holder, provided 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 such assignment shall be effective only if (i) the transferee
-------
agrees to be bound by the terms hereof and (ii) immediately following such
transfer the further disposition of such securities by the transferee or
assignee is restricted under the Securities Act.
1.13 Limitations on Subsequent Registration Rights. The parties
---------------------------------------------
hereto agree that additional holders may be added as parties to this Agreement
with respect to any or all securities of the Company held by them; provided,
--------
however, that from and after the date of this Agreement, the Company shall not
-------
without the prior written consent of (i) the Holders of a majority of the
Registrable Securities then outstanding, and (ii) the Holders of a majority of
the Registrable Securities issuable or issued upon conversion of the Series D
Preferred Stock, enter into any agreement with any holder or prospective holder
of any securities of the Company providing for the grant to such holder of
registration rights superior to or on a parity with those granted herein. Any
additional parties shall execute a counterpart of this Agreement, and upon
execution by such additional parties and by the Company, shall be considered
Holders for purposes of this Agreement, and shall be added to the Schedule of
Investors' Rights Holders.
1.14 "Market Stand-Off" Agreement. Each Holder hereby agrees that,
---------------------------
during the period of duration specified by the Company and an underwriter of
Common Stock or other securities of the Company, following the effective date of
the first registration statement of the Company filed under the Securities Act
to effect an IPO (up to, but not exceeding, one hundred twenty (120) days), it
shall not, to the extent requested by the Company and such underwriter, directly
or indirectly sell, offer to sell, contract to sell (including, without
limitation, any short sale), grant any option to purchase or otherwise transfer
or dispose of (other than to donees who agree to be similarly bound) any
Registrable Securities of the Company held by it at any time during such period
except Common Stock included in such registration; provided, however, that (i)
-------- -------
the directors and officers of the Company and holders of at least one percent
(1%) of the Company's securities agree to the Market Stand Off; and (ii) such
Market Stand Off Agreement shall provide that any discretionary waiver or
termination of the restrictions of such agreements by the Company or
representatives of the underwriter shall apply to all persons subject to such
agreements pro-rata based on the number of shares subject to such agreements.
-12-
In order to enforce the foregoing covenant, the Company may impose stop-transfer
instructions with respect to the Registrable Securities of each Holder (and the
shares or securities of every other person subject to the foregoing restriction)
until the end of such period, and each Holder agrees that, if so requested, such
Holder will execute an agreement in the form provided by the underwriter
containing terms which are essentially consistent with the provisions of this
Section 1.14.
Notwithstanding the foregoing, the obligations described in this
Section 1.14 shall not apply to a registration relating solely to employee
benefit plans on Form S-1 or Form S-8 or similar forms which may be promulgated
in the future, or a registration relating solely to an SEC Rule 145 transaction
on Form S-4 or similar forms which may be promulgated in the future.
1.15 Termination of Registration Rights. No Holder shall be entitled
----------------------------------
to exercise any right provided for in this Section 1 after the earlier of (i)
five (5) years following the closing of an IPO, or (ii) such time as Rule 144 or
another similar exemption under the Securities Act is available for the sale of
all of such Holder's shares (including any affiliates of such Holder) during a
three (3)-month period without registration.
2. Covenants of the Company.
------------------------
2.1 Delivery of Year-End Financial Statements. The Company shall
-----------------------------------------
deliver to each Holder and Founder as soon as practicable, but in any event
within ninety (90) days after the end of each fiscal year of the Company, an
income statement for such fiscal year, a balance sheet of the Company and
statement of stockholder's equity as of the end of such year, and a statement of
cash flows for such year, such year-end financial reports to be in reasonable
detail, prepared in accordance with generally accepted accounting principles
("GAAP"), and audited and certified by an independent public accounting firm of
----
nationally recognized standing selected by the Company.
2.2 Delivery of Additional Financial Information. The Company shall
--------------------------------------------
deliver to each Holder holding not less than 100,000 shares of Registrable
Securities (as adjusted for stock splits, recapitalizations and the like) (and
to each non-employee Founder and the Loveland Affiliates, the items described in
Sections 2.2(b) and (c) only):
(a) as soon as practicable, but in no event more than fifteen
(15) days after the end of each preceding month, unaudited monthly financial
statements for and as of the end of such month, in reasonable detail;
(b) within forty-five (45) days of the end of each fiscal
quarter, unaudited quarterly financial statements for and as of the end of such
fiscal quarter, in reasonable detail;
(c) within ninety (90) days of the end of each fiscal year,
audited annual financial statements for and as of the end of such fiscal year;
and
-13-
(d) as soon as practicable, but in any event thirty (30) days
prior to the end of each fiscal year, an annual budget and operating plan for
the next fiscal year, prepared on a monthly basis.
2.3 Inspection. The Company shall permit each Holder holding at
----------
least 100,000 shares of Registrable Securities (as adjusted for stock splits,
recapitalizations and the like), at such Holder's expense, to visit and inspect
the Company's properties, to examine its books of account and records and to
discuss the Company's affairs, finances and accounts with its officers, all at
such reasonable times as may be requested by the Holder; provided, however, that
-------- -------
the Company shall not be obligated pursuant to this Section 2.3 to provide
access to any information which it reasonably considers to be a trade secret or
similar confidential information, unless the Holder requesting such access signs
a confidentiality agreement reasonably acceptable to the Company and the Holder.
2.4 Right of First Offer. Subject to the terms and conditions
--------------------
specified in this Section 2.4, the Company hereby grants to each Holder holding
at least 100,000 shares of Registrable Securities (as adjusted for stock splits,
recapitalizations and the like) a right of first offer with respect to future
sales by the Company of its Shares (as hereinafter defined). A Holder who
chooses to exercise the right of first offer may designate as purchasers under
such right itself or its Affiliated Entities in such proportions as it deems
appropriate.
Each time the Company proposes to offer any shares of, or securities
convertible into or exercisable for any shares of, any class of its capital
stock ("Shares"), the Company shall first make an offering of such Shares to
------
each Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail
("Notice") to each Holder stating (i) its bona fide intention to offer such
------
Shares, (ii) the number of such Shares to be offered, and (iii) the price and
terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the
Notice, the Holder may elect to purchase or obtain, at the price and on the
terms specified in the Notice, up to (i) that portion of such Shares which
equals the proportion that the number of shares of Common Stock issued and held,
or issuable upon conversion and exercise of all convertible or exercisable
securities then held, by such Holder bears to the total number of shares of
Common Stock then outstanding (assuming full conversion and exercise of all
convertible or exercisable securities) (the "Pro-Rata Share") and (ii) any such
--------------
Shares not subscribed for by any other Holder.
(c) The Company may, during the forty-five (45)-day period
following the expiration of the period provided in subsection 2.4(b) hereof,
offer the remaining unsubscribed portion of the Shares to any person or persons
at a price not less than, and upon terms no more favorable to the offeree than
those specified in the Notice. If the Company does not enter into an agreement
for the sale of the Shares within such period, or if such agreement is not
consummated within 60 days of the execution thereof, the right provided
hereunder shall be deemed to be revived and such Shares shall not be offered
unless first reoffered to the Holder in accordance herewith.
-14-
(d) The right of first offer in this Section 2.4 shall not be
applicable (i) to the issuance or sale of Common Stock (or options therefor) to
employees, consultants and directors, pursuant to plans or agreements approved
by the Board of Directors, (ii) to the issuance of securities in connection with
an IPO (except as otherwise provided in Section 2.6 herein), (iii) to the
issuance of securities pursuant to the conversion or exercise of convertible or
exercisable securities, provided that such convertible or exercisable securities
have already been offered to the Holders pursuant to the provisions of this
Section 2.4, if such securities are not exempt pursuant to this Section 2.4(d),
(iv) to the issuance of securities in connection with a bona fide business
acquisition of or by the Company, whether by merger, consolidation, sale of
assets, sale or exchange of stock or otherwise, (v) to the issuance of
securities to financial institutions or lessors in connection with commercial
credit arrangements, equipment financings, or similar transactions, provided
that such issuance has been approved by the Board of Directors, (vi) to the
issuance or sale of Registrable Securities pursuant to the Purchase Agreement,
(vii) to the issuance of securities that, with unanimous approval of the Board
of Directors of the Company, are not offered to any existing stockholder of the
Company, or (viii) to the issuance of shares of Series C Preferred Stock to
PETCO Animal Supplies, Inc. and/or its employees pursuant to an Alliance
Agreement with the Company.
2.5 Board Observer Rights. For so long as 500,000 shares of Series D
---------------------
Preferred Stock remain outstanding, the Company shall permit Attractor
Investment Management Inc. ("Attractor") to designate one observer who is an
---------
employee of Attractor (the "Series D Observer"), who initially shall be Xxxxxx
-----------------
Xxxxxxx, to be present at all meetings of the Company's Board of Directors, or
any committee thereof which represents at least a majority of the members of the
Board of Directors, and to give the Series D Observer notice of such meetings at
the same time notice is provided or delivered to members of the Board of
Directors. Board of Directors' materials that are sent to the directors prior
to a meeting of the Board of Directors shall be sent simultaneously by the
Company to the Series D Observer; provided, however, that the Company may
-------- -------
exclude from the materials sent to the Series D Observer any materials that the
Company believes relate directly and substantially to any matter in which
Attractor has a business or financial interest.
In addition, if the Company receives advice from legal counsel that
discussing a specified matter in the presence of a person who is not a member of
the Board of Directors, or sending specified Board of Directors' materials to
such person, might result in the Company's loss of attorney-client privilege
with respect to a specified matter, the Company may exclude the Series D
Observer from a meeting or exclude such Board of Directors' materials from the
materials sent to the Series D Observer, or both, provided that the Company
shall promptly notify the Series D Observer that any exclusion from a meeting or
materials distributed to directors was effected to preserve its attorney-client
privilege or avoid conflicts of interest. Insofar as any possibility of
conflict of interest may arise with respect to the Series D Observer, all duties
and obligations that a member of the Board of Directors may have by virtue of
the law with respect to such conflict of interest shall apply to the Series D
Observer. Attractor and each of its officers, directors, employees and agents,
including the Series D Observer, agrees to maintain the confidentiality of any
information of the Company obtained by them.
-15-
2.6 Series D IPO Participation Rights. Subject to this Section 2.6
---------------------------------
and to the extent permissible under the federal securities laws, the rules and
regulations of the National Association of Securities Dealers, Inc. (the "NASD")
----
and all other applicable laws, rules and regulations, the Company shall use its
best efforts to cause the managing underwriter(s) of an IPO to offer to each
holder of at least 100,000 shares of Series D Preferred Stock or Common Stock
issued on conversion thereof (each a "Qualified Series D Holder") the right to
-------------------------
purchase its Pro-Rata Number of IPO Shares by delivering to each Qualified
Series D Holder a written solicitation of interest (a "Solicitation of
---------------
Interest") promptly after the filing of the registration statement relating to
--------
the IPO (or if later, an amendment thereto) which Solicitation of Interest shall
contain an estimated price range for the shares to be offered in the IPO. The
Solicitation of Interest shall contain a copy of the registration statement as
filed with the SEC. For the purpose of this Section 2.6, a Qualified Series D
Holder's "Pro-Rata Number" of IPO Shares shall be that number of shares of
---------------
capital stock of the Company determined by multiplying the number of IPO Shares
by a fraction, the numerator of which is the number of shares of Registrable
Securities issuable or issued upon conversion of the Series D Preferred Stock
then held by such Qualified Series D Holder, and the denominator of which is the
number of shares of Registrable Securities issuable or issued upon conversion of
the Series D Preferred Stock then held by all Qualified Series D Holders. If a
Qualified Series D Holder wishes to purchase IPO Shares, it shall promptly
respond to such offer within the time frame reasonably requested by the managing
underwriter(s) but not less than one (1) business day. The term "IPO Shares"
----------
shall mean that number of shares equal to five percent (5%) of the primary
shares to be sold by the Company in the IPO, at the gross price per share
negotiated by the Company with the managing underwriter(s) as reflected on the
final prospectus.
To the extent that one or more of the Qualified Series D Holders does
not offer to purchase its full Pro-Rata Number of IPO Shares, the Company shall
use its best efforts to cause the managing underwriter(s) to offer to each fully
participating Qualified Series D Holder that portion of any remaining IPO Shares
(the "Unsubscribed IPO Shares")determined by multiplying the number of
Unsubscribed IPO Shares by a fraction, the numerator of which is the number of
shares of Registrable Securities issuable or issued upon conversion of the
Series D Preferred Stock then held by such fully participating Qualified Series
D Holder, and the denominator of which is the number of shares of Registrable
Securities issuable or issued upon conversion of the Series D Preferred Stock
then held by all fully participating Qualified Series D Holders. Each Qualified
Series D Holder shall have the right to apportion its participation in the IPO
among any of its Affiliated Entities.
The Company's sale of IPO Shares to any Qualified Series D Holder
shall occur only at such time as the sale is confirmed under applicable
securities laws (the "Sale Date"). Each Qualified Series D Holder shall have
---------
the unconditional right to withdraw its expression of interest in its Pro Rata
Number of IPO Shares on or before the Sale Date.
Notwithstanding any other provision in this Section 2.6 or that
certain Letter Agreement regarding the Right to Participate in Initial Public
Offering by and among the Company and certain holders of the Company's Series A
Preferred Stock dated as of May 3, 1999, (the "Series A Allocation Agreement"),
-----------------------------
if the managing underwriter(s) determines, in its sole discretion, that it is
necessary to the success of the IPO, it shall have the right to reduce the
-16-
number of shares issued to the participating Qualified Series D Holders and the
parties to the Series A Allocation Agreement (the "Series A Participants");
---------------------
provided, however, that the managing underwriter(s) shall set forth its reasons
-------- -------
in writing to the participating Qualified Series D Holders and Series A
Participants for so reducing the number of IPO Shares no later than five (5)
business days prior to the effectiveness of the final registration statement
covering the IPO; and provided, further, that the number of shares actually
-------- -------
offered to each participating Qualified Series D Holder and Series A Participant
shall be equal to the number of shares which would otherwise have been offered
to such Qualified Series D Holder or Series A Participant multiplied by a
fraction, the numerator of which shall be the aggregate number of shares
actually offered by the managing underwriter to all Qualified Series D Holders
and Series A Participants, and the denominator of which shall be equal to the
number of IPO Shares plus the number of shares which would otherwise have been
offered to the Series A Participants pursuant to the Series A Allocation
Agreement.
2.7 Termination of Covenants. The covenants set forth in Sections
------------------------
2.1 through 2.4 and 2.6 shall terminate as to each Holder and be of no further
force or effect upon the earliest to occur of (i) immediately prior to the
consummation of a Qualified IPO, (ii) the date on which the Company first
becomes subject to filing reports under Section 13 or 15(d) of the Exchange Act,
(iii) the date on which quotations for the Common Stock of the Company are
reported on the automated quotation system of the National Association of
Securities Dealers, Inc. or on an equivalent quotation system or shares of the
Common Stock of the Company are listed on a national securities exchange
registered under the Exchange Act, and (iv) a sale of all or substantially all
of the assets of the Company or the merger or consolidation of the Company with
or into any other corporation or entity, other than a wholly-owned subsidiary of
the Company, or the sale of the outstanding stock of the Company, or as a result
of which the stockholders of the Company immediately prior to such transaction
hold less than 50% of the voting power of the surviving corporation.
3. Miscellaneous.
-------------
3.1 Successors and Assigns. Except as otherwise provided in this
----------------------
Agreement, the terms and conditions of this Agreement shall inure to the benefit
of and be binding upon the respective permitted successors and assigns of the
parties (including transferees of any of the Preferred Stock or any Common Stock
issued upon conversion thereof). 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.
3.2 Amendments and Waivers. Any term of this Agreement may be
----------------------
amended or waived only with the written consent of the Company and the holders
of a majority of the Registrable Securities then outstanding (not including the
Founders' Stock and stock held by the Loveland Affiliates or any permitted
transferees thereof); provided that if such amendment has the effect of
--------
affecting the Founders, the Loveland Affiliates, or the Holders of Registrable
Securities issuable or issued upon conversion of the Series D Preferred Stock,
as the case may be, (i) in a manner different than the other Holders, and (ii)
in a manner adverse to the interests of the Founders, the Loveland Affiliates,
or the Holders of Registrable Securities issuable or issued
-17-
upon conversion of the Series D Preferred Stock, as the case may be, then such
amendment shall require the consent of the Holder or Holders of a majority of
the Founders' Stock, the Holder or Holders of a majority of the stock held by
the Loveland Affiliates, or the Holder or Holders of a majority of the
Registrable Securities issuable or issued upon conversion of the Series D
Preferred Stock, as the case may be; and provided further that if such amendment
----------------
has the effect of terminating the rights under Sections 1 or 2.4 hereof with
respect to the Registrable Securities issuable or issued upon conversion of the
Series D Preferred Stock, then such amendment shall require the separate consent
of the Holder or Holders of a majority of the Registrable Securities issuable or
issued upon conversion of the Series D Preferred Stock, voting together as a
separate class. 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, the
Founders, the Loveland Affiliates and the Company.
3.3 Notices. Any notice required or permitted by this Agreement shall
-------
be in writing and shall be deemed sufficient upon delivery, when delivered
personally or by overnight courier or sent by telegram or fax, addressed to the
party to be notified at such party's address as set forth on the signature page
or Exhibit A hereto, or to the address of record provided to the Company by each
---------
party hereto with a copy to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attn: W. Xxxxxx Xxxxx, Esq., and if to the Company, with a copy to
Xxxxxxx Coie LLP, 000 Xxxxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxx Xxxx, XX 00000-0000,
Fax (000) 000-0000, Attn: Xxxx X. Xxxxxx, Esq.
3.4 Severability. If one or more provisions of this Agreement are
------------
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (i) such
provision shall be excluded from this Agreement, (ii) the balance of the
Agreement shall be interpreted as if such provision were so excluded, and (iii)
the balance of the Agreement shall be enforceable in accordance with its terms.
3.5 Governing Law. This Agreement and all acts and transactions
-------------
pursuant hereto shall be governed, construed and interpreted in accordance with
the laws of the State of California, without giving effect to principles of
conflicts 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 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.
3.8 Aggregation of Stock. For the purpose of determining the
--------------------
availability of any rights under any section of this Agreement, the number of
shares held by Affiliated Entities of the same party shall be aggregated
together; provided that all such Affiliated Entities that would not qualify
individually for such rights shall have a single attorney-in-fact for the
purpose of exercising any rights, receiving notices or taking any action under
this Agreement.
-18-
3.9 Entire Agreement. This Agreement and the documents and
-----------------
instruments referred to herein constitute the entire agreement between the
parties hereto pertaining to the subject matter hereof, and any and all other
written or oral agreements relating to the subject matter hereof existing
between the parties hereto are expressly canceled.
-19-
The parties have executed this Fourth Amended and Restated Investors'
Rights Agreement as of the date first above written.
COMPANY
XXXXXXX.XXX, INC.
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
INVESTORS:
TCV III (GP)
a Delaware General Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
TCV III, L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
TCV III (Q), L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
TCV III STRATEGIC PARTNERS, L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
Mailing Address:
Technology Crossover Ventures
00 Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Technology Crossover Ventures
000 Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Attention: Xxx X. Xxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
ARKARO HOLDING, B.V.
By: __________________________________
Name:
Title:
Mailing Address:
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
PETCO ANIMAL SUPPLIES, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Chairman, President and Chief Executive
Officer
Mailing Address:
0000 Xxxxx Xxxx
Xxx Xxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
NATIONAL BROADCASTING COMPANY, INC.
a Delaware corporation
By:_________________________________________
Name:
Title:
Mailing Address:
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: President, NBC Interactive Media
With a copy to: VP, Law, Corporate Transactions
VALUEVISION INTERNATIONAL INC.
a Minnesota corporation
By:_________________________________________
Name:
Title:
Mailing Address:
0000 Xxxxx Xxx Xxxx
Xxxx Xxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Faegre & Xxxxxx LLP
0000 Xxxxxxx Xxxxxx
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
GREYROCK CAPITAL, a division of
BANC OF AMERICA COMMERCIAL FINANCE
CORPORATION
By:_________________________________________
Name:
Title:
Mailing Address:
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
CLIFCOR CAPITAL, LLC
By:_________________________________________
Name:
Title:
Mailing Address:
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
By: /s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx, as attorney in fact on behalf of
XXX XXXXXX
000 X. 00/xx/ Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXXXXX XXXXXXXXX
000 Xxxx 00/xx/
Xxx Xxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXX X. XXXXXXX
000 Xxxxxxxx Xxxxx
Xxxx Xxxxxx, XX 00000
X.X. XXXXXXXXXX
X.X. Xxx 000
Xxxxxxx, XX 00000
XXXXX X'XXXXXX
X.X. Xxx 00
Xx. Xxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXXX XXXXXX
0000 Xxxxxxx
Xxxxxxxxx, X.XX 00000
Phone: (000) 000-0000
XXXXXX X. XXXXXX
0000 X. 00xx Xxxx
Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXXXXX X. XXXXXXXXX-XXXXXX
0000 X. 00xx Xxxx
Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
XXXXXX X. XXXX
000 Xxxxxxx Xxxx
XxXxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXXXX X. XXXX, AS TRUSTEE UNDER
THE XXXXXX X. XXXX LIVING TRUST
UTD 10/31/94
000 Xxxxxxx Xxxx
XxXxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXXXXXX X. XXXX, AS TRUSTEE
UNDER THE XXXXXXXX X. XXXX
LIVING TRUST UTD 10/31/94
000 Xxxxxxx Xxxx
XxXxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
XXXX XXXXXXX
0000 Xxxxxxxx Xxxxxx, #000
Xxx Xxxxxxxxx, XX 00000
XXXX XXXXXXXX
0000 Xxxxx Xxxxxx, #0
Xxxxxxx, XX 00000-0000
XXX XXXXXXX
000 Xx Xxxxxx
Xx Xxxxx, XX 00000
XXXXX XXXXX
0000 Xxxxx Xxxxx, #000
Xxx Xxxxx, XX 00000-0000
XXXXXXX XXXX
0 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
XXXXX XXXXXXXX
00 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, XX 00000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
XXXXXXXX XXXX
000 Xxxxxx Xxxxxx
Xxxx Xxxx, XX 00000
XXXXXX XXXXXXXXX
000 Xxxx 00/xx/ Xxxxxx
Xxx. 00X
Xxx Xxxx, XX 00000
XXXXXXXX XXXXXXX
0000 Xxxxxxx Xxxx, Xxx. X
Xx Xxxxx, XX 00000
XXX XXXXX
000 Xxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
XXXXX XXXXXXXX
0000 X. Xxxxx Xxxx Xxxxxxxxx, #00
Xxx Xxxxx, XX 00000
XXXXX XXXXX
000 Xxxxxxxx Xxxx
Xxx. 000
Xxxxxxxxx, XX 00000
XXXXX XXXXXXX
0000 Xxxxx Xxxxx, #00
Xxx Xxxxxxxxx, XX 00000
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
FOUNDERS:
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
