EXHIBIT 4.1
PIGGYBACK REGISTRATION RIGHTS AGREEMENT
THIS PIGGYBACK REGISTRATION RIGHTS AGREEMENT, dated as of September 3, 2002
(this "Agreement"), is entered into by and made among J2 COMMUNICATIONS, a
California corporation (the "Company"), CONSTELLATION VENTURE CAPITAL, L.P., a
Delaware limited partnership ("Agent") and those parties set forth on the
Schedule of Shareholders attached hereto (each, a "Shareholder" and
collectively, together with Agent, the "Shareholders").
In consideration of the promises made herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE 1. DEFINITIONS.
Section 1.1 Definitions. As used in this Article 1 and elsewhere in this
Agreement, the following terms shall have the following respective meanings:
"Agent" shall have the meaning set forth in the preamble.
"Agreement" shall have the meaning set forth in the preamble.
"BBN" means Burly Bear Network, Inc., a Delaware corporation.
"Commission" means the Securities and Exchange Commission or any other
federal agency administering the Securities Act.
"Common Shares" means the Company's Common Stock, no par value per share.
"Company" shall have the meaning set forth in the preamble.
"Escrow Agreement" means that certain Escrow Agreement, dated as of this
date, by and among NLN, Agent and The National Bank of Indianapolis, as
escrow agent and agreed and acknowledged by BBN.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
any similar successor federal law then in force.
"Existing Registration Rights Agreement" means any agreement to provide
registration rights with respect to the securities of the Company, which is
effective prior to the date of this Agreement, including, without
limitation, the Jimirro Registration Rights Agreement and NLAG Registration
Rights Agreement, each dated as of May 17, 2002, by and among the Company
and the applicable parties thereto, as each such agreement may be amended
and modified from time to time.
"Joinder Agreement" means the "Amendment To and Agreement To Join In and Be
Bound By Piggback Registration Rights Agreement" attached as Exhibit A
hereto.
"Lenders" means the lenders party to that certain Senior Secured Credit
Agreement dated as of April 1, 2002, as amended from time to time, by and
among Burly Bear Network, Inc., a Delaware corporation, Agent, individually
and as agent for the Lenders, and the Lenders specified therein.
"NLN" means National Lampoon Networks, Inc., a Delaware corporation.
"Pari Passu Registrable Securities" means all securities of the Company,
the holders of which have been, or are in the future, granted registration
rights with respect thereto to the extent the agreement providing the
registration rights provides, expressly or by implication, that such
registration rights are "pari passu" or in parity in an underwritten
registration or distribution by prospectus with the registration rights
granted under this Agreement to holders of Registrable Securities.
"Person" means an individual, a partnership, a joint venture, a
corporation, a limited liability company, a trust, an unincorporated
organization, a government or any department or agency thereof or any other
entity.
"Piggyback Registration" shall have the meaning set forth in Section 2.1.
"Purchase Agreement" means that certain Asset Purchase Agreement, dated as
of August __, 2002, by and among BBN, NLN, and for limited purposes the
Company and Agent.
"Registrable Securities" means any (i) Common Shares issued and actually
delivered to Agent pursuant to the terms of the Purchase Agreement and any
replacements thereof as contemplated under the terms of the Purchase
Agreement and the Escrow Agreement and (ii) any Common Shares issued in
respect of securities referenced in clause (i) of this definition.
"Registration Expenses" shall have the meaning set forth in Section 4.1.
"Registration Statement" means the prospectus and other documents filed
with the Commission to effect a registration under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar federal law then in force.
"Selling Expenses" means all underwriting discounts, selling commissions
and transfer taxes incurred pursuant to the sale of Registrable Securities.
"Senior Registrable Securities" means (i) all securities of the Company,
the holders of which have been granted registration rights with respect
thereto under an Existing Registration Rights Agreement, and (ii) all
securities of the Company, the holders of which have been granted
registration rights with respect thereto after the date of this Agreement
to the extent the agreement providing the registration rights provides,
expressly or by implication, that such registration rights are senior in
priority in an underwritten registration or distribution by prospectus to
the registration rights granted under this Agreement to holders of
Registrable Securities.
"Shareholders" shall have the meaning set forth in the preamble.
ARTICLE 2. PIGGYBACK REGISTRATIONS.
Section 2.1 Right to Piggyback. Whenever the Company proposes to register
or qualify for distribution by prospectus any of its securities ((a)other than
pursuant to a demand registration granted to another shareholder of the Company
by an agreement that prohibits piggyback registrations in connection with such
demand registration or (b) a registration under the Securities Act on Form S-4
or S-8 or any successor or similar forms) and the registration form or
prospectus to be filed may be used for the registration or qualification for
distribution of Registrable Securities (a "Piggyback Registration"), whether or
not for sale for its own account, the Company will give prompt written notice to
all holders of Registrable Securities of its intention to effect the
registration or file the prospectus and, subject to the limitations contained in
this Article 2, will include in the registration or qualification all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within fifteen (15) days after the receipt of the
Company's notice. Any holder of Registration Securities that has given a written
request may withdraw its Registrable Securities from the related Piggyback
Registration by giving written notice to the Company and the managing
underwriter, if any, on or before the thirtieth (30th) day prior to the planned
effective date of the related Piggyback Registration.
Section 2.2 Piggyback Expenses. The Registration Expenses of the holders of
Registrable Securities will be paid by the Company in all Piggyback
Registrations whether or not any registration or prospectus has become effective
or final.
Section 2.3 Priority on Primary Registrations. If a Piggyback Registration
is an underwritten primary registration or distribution by prospectus on behalf
of the Company, and the managing underwriters advise the Company in writing
(with a copy to each party hereto requesting registration or qualification for
distribution by prospectus of Registrable Securities) that in their opinion the
number of securities requested to be included in the registration or prospectus
exceeds the number which can be sold in an offering without adversely affecting
the marketability of the offering, the Company will include in the registration
or prospectus (i) first, the securities the Company proposes to sell, (ii)
second, the Senior Registrable Securities requested to be included in the
registration in the manner provided for by the applicable registration rights
agreements, (iii) third, the Registrable Securities and Pari Passu Registrable
Securities requested to be included in the registration, pro rata among the
holders of the securities on the basis of the number of securities so requested
to be included therein owned by each holder, and (iv) fourth, other securities
requested to be included in the registration. The Company shall have the right
to terminate or withdraw any registration initiated by it under this Section
prior to the effectiveness of such registration, whether or not any holder of
Registrable Securities has elected to include securities in the registration and
the Company shall have no liability to any of the holders of Registrable
Securities in connection with such termination or withdrawal.
Section 2.4 Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration or distribution by
prospectus on behalf of holders of the Company's securities, and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in the registration or qualification for
distribution by prospectus exceeds the number which can be sold in an offering
without adversely affecting the marketability of the offering, the Company will
include in the registration or prospectus (i) first, the securities requested to
be included therein by the holders requesting the registration, (ii) second, the
Senior Registrable Securities requested to be included in the registration, in
the manner provided for by the applicable registration rights agreements, (iii)
third, the Registrable Securities and the Pari Passu Registrable Securities
requested to be included in the registration, pro rata among the holders of the
securities on the basis of the number of securities so requested to be included
therein owned by each holder, and (iv) fourth, other securities requested to be
included in the registration.
Section 2.5 Other Registrations. If the Company has previously filed a
Registration Statement with respect to Registrable Securities pursuant to this
Article 2, and if such previous registration or offering by prospectus has not
been withdrawn or abandoned, the Company will not file and shall not be required
to file or cause to be effected any other registration of any of its equity
securities or securities convertible or exchangeable into or exercisable for its
equity securities under the Securities Act (except under the Securities Act on
Form S-4 or S-8 or any successor or similar forms), whether on its own behalf or
at the request of any holder or holders of such securities, until a period of at
least ninety (90) days have elapsed from the effective date of such previous
registration.
ARTICLE 3. REGISTRATION PROCEDURES.
Section 3.1 Registration Procedures. Subject to Sections 2.5, whenever the
holders of Registrable Securities have requested that any Registrable Securities
be registered pursuant to this Agreement and such Registrable Securities are in
fact included in the Registration Statement, the Company will use its best
efforts to effect the registration and sale of those Registrable Securities in
accordance with the intended method of disposition thereof, and pursuant thereto
the Company will as expeditiously as possible:
(a) prepare and, within ninety (90) days after the end of the period within
which requests for registration may be given to the Company, unless the
failure to file within such ninety (90) day period occurs due to matters
outside the Company's control, in which case as soon as practicable, file
with the Commission a Registration Statement with respect to the
Registrable Securities and thereafter use its best efforts to cause the
Registration Statement to become effective;
(b) prepare and file with the Commission any amendments and supplements to the
Registration Statement as may be necessary to keep the Registration
Statement effective for a period of either (i) not less than ninety (90)
days (subject to extension pursuant to Section 6.2) or, if the Registration
Statement relates to an underwritten offering, such longer period as in the
opinion of counsel for the underwriters a prospectus is required by law to
be delivered in connection with sales of Registrable Securities by an
underwriter or dealer or (ii) a shorter period as will terminate when all
of the securities covered by the Registration Statement have been disposed
of in accordance with the intended methods of disposition by the seller or
sellers thereof set forth in the Registration Statement (but in any event
not before the expiration of any longer period required under the
Securities Act), and to comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by the
Registration Statement until such time as all of the securities have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof set forth in the Registration Statement;
(c) furnish to each seller of Registrable Securities the number of copies of
the Registration Statement, each amendment and supplement thereto,
including each preliminary prospectus, final prospectus and other documents
as the seller may reasonably request in order to facilitate the disposition
of the Registrable Securities owned by the seller;
(d) use its best efforts to register or qualify the Registrable Securities
under any other securities or blue sky laws of any jurisdictions as any
seller reasonably requests and do any and all other acts and things which
may be reasonably necessary or advisable to enable the seller to consummate
the disposition in those jurisdictions of the Registrable Securities owned
by the seller (provided that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph, (ii) subject
itself to a form of taxation in any jurisdiction where it would not
otherwise be subject to such form of taxation but for this subparagraph or
(iii) consent to general service of process in any jurisdiction where it
would not otherwise be subject to general service of process but for this
subparagraph);
(e) promptly notify each seller of the Registrable Securities, at any time when
a prospectus relating thereto is required to be delivered under the
Securities Act, upon discovery that, or upon the discovery of the happening
of any event as a result of which, the prospectus contains an untrue
statement of a material fact or omits to state any fact necessary to make
the statements therein not misleading in the light of the circumstances
under which they were made, and, at the request of any such seller, the
Company will prepare and furnish to seller a reasonable number of copies of
a supplement or amendment to the prospectus so that, as thereafter
delivered to the purchasers of Registrable Securities, the prospectus will
not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading in the light
of the circumstances under which they were made;
(f) use its best efforts to cause all the Registrable Securities to be listed
on each securities exchange on which similar securities issued by the
Company are then listed;
(g) provide a transfer agent and registrar for all the Registrable Securities
not later than the effective date of, or date of final receipt for, the
Registration Statement;
(h) enter into any customary agreements (including underwriting agreements with
customary provisions) and take all other actions as the underwriters, if
any, reasonably request in order to expedite or facilitate the disposition
of the Registrable Securities (including, without limitation, effecting a
share split or a combination of shares);
(i) make available for inspection, subject to reasonable confidentiality
restrictions on use, by any seller of Registrable Securities, any
underwriter participating in any disposition pursuant to the Registration
Statement and any attorney, accountant or other agent retained by any
seller or underwriter, all financial and other records, pertinent corporate
documents and documents relating to the business of the Company, and cause
the Company's officers, directors, employees and independent accountants to
supply all information reasonably requested by any seller, underwriter,
attorney, accountant or agent in connection with the Registration
Statement;
(j) otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission, and make available to its security holders,
as soon as reasonably practicable, an earnings statement covering the
period of at least twelve (12) months beginning with the first day of the
Company's first full calendar quarter after the effective date of the
Registration Statement, which earnings statement shall satisfy, in the case
of a registration in the United States, the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder;
(k) in the event of the issuance of any stop order suspending the effectiveness
of a Registration Statement, or of any order suspending or preventing the
use of any related prospectus or ordering the cessation of trading or
suspending the qualification of any securities included in the Registration
Statement for sale in any jurisdiction, the Company will use its best
efforts promptly to obtain the withdrawal of the order;
(l) in connection with any underwritten offering, to the extent the Company
obtains one or more comfort letters from the Company's independent public
accountants, obtain comfort letters, addressed to the holders of the
Registrable Securities being sold, dated the effective date of such
Registration Statement (and, if the registration includes an underwritten
public offering, dated the date of the closing under the underwriting
agreement) signed by the Company's independent public accountants in
customary form and covering matters of the type customarily covered by
comfort letters; and
(m) in connection with any underwritten offering provide legal opinions of the
Company's outside counsel, addressed to the holders of the Registrable
Securities being sold, dated the effective date of the Registration
Statement (and, if the registration includes an underwritten public
offering, dated the date of the closing under the underwriting agreement),
with respect to the Registration Statement, each amendment and supplement
thereto (including the preliminary prospectus) and all other documents
relating thereto in customary form and covering matters of the type
customarily covered by legal opinions of such nature.
The Company may require each seller of Registrable Securities as to which
any registration is being effected to furnish the Company with information
regarding the seller and the intended and actual distribution of the securities
as the Company may from time to time reasonably request.
ARTICLE 4. REGISTRATION EXPENSES.
Except as otherwise expressly provided herein, all expenses incidental to
the Company's performance of or compliance with this Agreement, including,
without limitation, all registration and filing fees, fees and expenses of
compliance with securities or blue sky laws, word processing, duplicating and
printing expenses, messenger and delivery expenses, and fees and disbursements
of counsel for the Company and all independent certified public accountants,
underwriters and other Persons retained by the Company (all expenses being
herein called "Registration Expenses"), will be borne by the Company. The
Company will, in any event, pay its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the expense of any annual audit or quarterly
review, the expense of any liability insurance and the expenses and fees for
listing the securities to be registered on each securities exchange on which
similar securities issued by the Company are then listed. Notwithstanding the
foregoing, all Selling Expenses shall be borne by the holders of the securities
so registered pro rata on the basis of the number of their shares so registered.
ARTICLE 5. INDEMNIFICATION.
Section 5.1 Indemnification. The Company agrees to indemnify and hold
harmless, and hereby does indemnify and hold harmless, each holder of
Registrable Securities, its affiliates and their respective officers, directors
and partners and each Person who controls the holder (within the meaning of the
Securities Act) against, and pay and reimburse the holder, affiliate, director,
officer or partner or controlling person for any losses, claims, damages and
liabilities, joint or several, to which the holder or any such affiliate,
director, officer or partner or controlling person may become subject under the
Securities Act or otherwise, insofar as the losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon (i) any untrue or alleged untrue
statement of material fact contained in any Registration Statement, prospectus
or preliminary prospectus or any amendment thereof or supplement thereto or,
(ii) any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, and the
Company will pay and reimburse holder and each affiliate, director, officer,
partner and controlling person for any legal or any other expenses actually and
reasonably incurred by them in connection with investigating or defending any
loss, claim, liability, action or proceeding; provided, however, that the
Company shall not be liable in any case to the extent that any loss, claim,
damage, liability (or action or proceeding in respect thereof) or expense arises
out of or is based upon an untrue statement or alleged untrue statement, or
omission or alleged omission, made in the Registration Statement, any prospectus
or preliminary prospectus or any amendment or supplement thereto, or in any
application, in reliance upon, and in conformity with, written information
prepared and furnished to the Company by the holder expressly for use therein or
by the holder's failure to deliver a copy of the Registration Statement or
prospectus or any amendments or supplements thereto after the Company has
furnished the holder with a sufficient number of copies of the same. In
connection with an underwritten offering, the Company, if requested, will
indemnify the underwriters, their officers and directors and each Person who
controls the underwriters (within the meaning of the Securities Act) to the same
extent as provided above with respect to the indemnification of the holders of
Registrable Securities.
Section 5.2 Cooperation. In connection with any Registration Statement in
which a holder of Registrable Securities is participating, each holder will
furnish to the Company in writing the information and affidavits as the Company
reasonably requests for use in connection with any Registration Statement or
prospectus and will indemnify and hold harmless the Company, its directors and
officers, each underwriter and each other Person who controls the Company
(within the meaning of the Securities Act) against any losses, claims, damages
and liabilities, joint or several, to which the Company or any director or
officer, any underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as the losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon (i) any untrue or alleged untrue
statement of material fact contained in the Registration Statement, prospectus
or preliminary prospectus or any amendment thereof or supplement thereto or in
any application or (ii) any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that the untrue statement or omission is made
in the Registration Statement, any prospectus or preliminary prospectus or any
amendment or supplement thereto, or in any application, in reliance upon and in
conformity with written information prepared and furnished to the Company by the
holder expressly for use therein, and such holder will reimburse the Company and
each director, officer, underwriter and controlling Person for any legal or any
other expenses actually and reasonably incurred by them in connection with
investigating or defending any loss, claim, liability, action or proceeding;
provided, however, that the obligation to indemnify and hold harmless will be
individual and several to each holder and will be limited to the net amount of
proceeds received by the holder from the sale of Registrable Securities pursuant
to the Registration Statement.
Section 5.3 Contribution. If the indemnification provided for in Sections
5.1 or 5.2 is unavailable to an indemnified party under such Sections (other
than by reason of exceptions provided in those Sections) in respect of any
claims referred to in such Sections, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such claims in such
proportion as is appropriate to reflect the relative fault of the Company on the
one hand and of the holder of Registrable Securities on the other in connection
with the statements or omissions which resulted in such claims. The amount paid
or payable by a party as a result of the claims referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action or claim.
The relative fault of the Company on the one hand and of the holder of
Registrable Securities on the other shall be determined by reference to, among
other things, whether the applicable misstatement or alleged misstatement
relates to information supplied by the Company or by the holder of Registrable
Securities and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such misstatement or alleged misstatement.
The Company and the Shareholders agree that it would not be just and equitable
if contribution pursuant to this Section 5.3 were determine by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the provisions
of this Section 5.3, the holder of Registrable Securities shall not be required
to contribute any amount pursuant hereto in excess of the net proceeds (after
deducting any discounts or commissions received by an underwriter in connection
with such registration) from the offering received by the holder of Registrable
Securities. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution
hereunder from any person who was not guilty of such fraudulent
misrepresentation.
Section 5.4 Notice. Any Person entitled to indemnification hereunder will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification and (ii) unless in the indemnified
party's reasonable judgment a conflict of interest between the indemnified and
indemnifying parties may exist with respect to the claim, permit the
indemnifying party to assume the defense of the claim with counsel reasonably
satisfactory to the indemnified party. If the defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without the indemnifying party's prior written consent
(but its consent will not be unreasonably withheld). An indemnifying party who
is not entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel for all parties
indemnified by the indemnifying party with respect to the claim, unless in the
reasonable judgment of any indemnified party a conflict of interest may exist
between the indemnified party and any other of the indemnified parties with
respect to the claim.
Section 5.5 Survival. The indemnification provided for under this Agreement
will remain in full force and effect regardless of any investigation made by or
on behalf of the indemnified party or any officer, director or controlling
Person of the indemnified party and will survive the transfer of securities.
Each party hereto also agrees to make any provisions, as are reasonably
requested by any indemnified party, for contribution to the party in the event
that indemnification from the party hereto is unavailable for any reason.
ARTICLE 6. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS.
Section 6.1 Participation. No Person may participate in any registration
hereunder which is underwritten unless that Person (i) agrees to sell the
Person's securities on the basis provided in any underwriting arrangements
approved by the Company (including, without limitation, pursuant to the terms of
any over-allotment or "green shoe" option requested by the managing
underwriter(s), provided that no holder of Registrable Securities will be
required to sell more than the number of Registrable Securities that the holder
has requested the Company to include in any registration), (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of the
underwriting arrangements, and (iii) cooperates with the Company's reasonable
requests in connection with the registration or qualification (it being
understood that the Company's failure to perform its obligations hereunder,
which failure is caused by the Person's failure to cooperate, will not
constitute a breach by the Company of this Agreement).
Section 6.2 Notice. Each holder of Registrable Securities who is
participating in any registration hereunder agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
Section 3.1(e), such holder will forthwith discontinue the disposition of its
Registrable Securities pursuant to the Registration Statement until such
holder's receipt of the copies of a supplemented or amended prospectus as
contemplated by Section 3.1(e). In the event the Company shall give any such
notice, the applicable time period mentioned in Section 3.1(b) during which a
Registration Statement is to remain effective shall be extended by the number of
days during the period from and including the date of the giving of the notice
pursuant to this Section to and including the date when each seller of a
Registrable Security covered by the Registration Statement shall have received
the copies of the supplemented or amended prospectus contemplated by Section
3.1(e).
Section 6.3 Holdback Agreements by Holders of Registrable Securities. Each
holder of Registrable Securities agrees not to effect any public sale or
distribution of equity securities of the Company, or any securities convertible
into or exchangeable or exercisable for such securities, including any sale
pursuant to Rule 144 (except as part of the underwritten registration, if
permitted) during the seven (7) days prior to, and the ninety (90) days
following, the effective date of any underwritten public offering (unless the
managing underwriter agrees otherwise). Each holder of Registrable Securities
agrees to enter into customary lock-up agreements consistent with the foregoing
if requested by any underwriter of any such public offering. In order to enforce
the foregoing covenant, the Company may impose stop-transfer instructions with
respect to the securities of the Company held by each holder (and the shares or
securities of every other Person subject to the foregoing restriction) until the
end of that period.
ARTICLE 7. MISCELLANEOUS.
Section 7.1 Effective Date of Registration Rights. The piggyback
registration rights granted to the holders of the Registrable Securities
pursuant to Article 2 shall not be effective until the escrow created under the
Escrow Agreement terminates and the Registrable Shares held thereby are
delivered to Agent (or its designees) in accordance with the terms of the Escrow
Agreement and the Purchase Agreement. Further, no holder of Registrable
Securities shall have any right to enforce the Piggyback Registration Rights
granted hereunder unless and until such holder has executed a Joinder Agreement.
Section 7.2 Subordination.
(a) It is expressly understood and agreed by Agent and each Shareholder that
the registration rights granted hereby are in all respects subordinated to
the registration rights granted under the Existing Registration Rights
Agreements. To the extent any provision of this Agreement could be deemed
inconsistent with or violative of the rights granted to holders of
"registrable securities" under the Existing Registration Rights Agreements,
this Agreement shall be interpreted and/or, without further action on the
part of the parties hereto, deemed modified to the extent necessary to
remove such inconsistency or violation.
(b) Nothing in this Agreement shall limit or restrict the rights of the Company
to grant registration rights with respect to the securities of the Company
which are senior or pari passu to the rights granted hereunder.
Section 7.3 Remedies. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party hereto shall have the right to injunctive relief,
in addition to all of its other rights and remedies at law or in equity, to
enforce the provisions of this Agreement; provided, however, that no Shareholder
shall have any right to an injunction to prevent the filing or effectiveness of
any Registration Statement of the Company.
Section 7.4 Amendments and Waivers. Except as otherwise provided herein,
the provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and holders of a majority of the Registrable
Securities and provided, however, that in the event that an amendment or waiver
would treat a holder or group of holders of Registrable Securities in a manner
different from any other holders of Registrable Securities, then the amendment
or waiver will require the consent of the holder or the holders of a majority of
the Registrable Securities of the group adversely treated. Notwithstanding the
foregoing, the parties to this Agreement agree that this Agreement and the
Schedule of Shareholders attached hereto shall be amended without further action
on their part to add as Shareholders any Lender. Upon Lender taking title to any
Registrable Securities, the Company shall cause the Schedule of Shareholders to
be amended to add such Lender as a Shareholder and shall cause an appropriate
amendment to this Agreement to be prepared, substantially in the form attached
hereto as Exhibit A, and such amendment shall become effective upon execution of
such amendment by the Lender acquiring such shares.
Section 7.5 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns. In addition, and whether or not any express
assignment shall have been made, the provisions of this Agreement which are for
the benefit of the holders of the Registrable Securities (or any portion
thereof) as such shall be for the benefit of and enforceable by any subsequent
holder of any Registrable Securities (or of such portion thereof).
Section 7.6 Severability. Whenever possible, each provision of this
Agreement shall be interpreted in the manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or the effectiveness or validity of any provision in any
other jurisdiction, and this Agreement shall be reformed, construed and enforced
in the jurisdiction as if the invalid, illegal or unenforceable provision had
never been contained herein.
Section 7.7 Counterparts. This Agreement may be executed simultaneously in
two or more counterparts, any one of which need not contain the signatures of
more than one party, but all counterparts taken together will constitute one and
the same Agreement.
Section 7.8 Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
Section 7.9 Governing Law. This Agreement shall be governed by, construed
and enforced in accordance with the laws of the state in which the Company is
incorporated without regard to the principles of conflicts of law thereof.
Section 7.10 Notices. All notices, demands or other communications to be
given or delivered under or by reason of the provisions of this Agreement shall
be in writing and shall be deemed effectively given: (i) upon personal delivery
to the party to be notified, (ii) when sent by confirmed telex or facsimile if
sent during normal business hours of the recipient; if not, then on the next
business day, (iii) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid, or (iv) one (1) day
after deposit with a nationally recognized overnight courier, specifying next
day delivery, with written verification of receipt. All notices shall be
addressed to the Company at its principal office, to Agent at 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxx, to each
Shareholder at the address of such Shareholder appearing on the books of the
Company or to such other address as the Company, Agent or each Shareholder shall
have furnished to the other in writing.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
above date.
J2 COMMUNICATIONS
By: /s/ Xxxxxx X. Xxxxxx
------------------------------
Xxxxxx X. Xxxxxx,
Chief Operating Officer
CONSTELLATION VENTURE CAPITAL, L.P.
By: Constellation Ventures Management LLC, its
General Partner
By:/s/ Xxxxxx X. Xxxxxx
--------------------------------
Title:Managing Director
-----------------------------
SCHEDULE OF SHAREHOLDERS
NAME Address
------------------- ------------------------------------
-------------------------------- ------------------------------------
Constellation Venture Capital, 000 Xxxxxxx Xxxxxx
L.P., as agent for the Lenders Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx
-------------------------------- ------------------------------------
EXHIBIT A
AMENDMENT TO AND AGREEMENT TO JOIN IN AND BE BOUND BY
PIGGYBACK REGISTRATION RIGHTS AGREEMENT
THE UNDERSIGNED, in consideration of the opportunity to join as a
Shareholder under and be bound by the Piggyback Registration Rights Agreement
(the "Agreement") by and among J2 Communications (the "Company"), Constellation
Venture Capital, L.P., as agent for the Lenders, and certain other Persons
listed on the Schedule of Shareholders, as it may be amended from time to time,
dated August __, 2002, hereby acknowledges receipt of a copy of the Agreement,
acknowledges the opportunity to review the terms and provisions of the
Agreement, and agrees to join in and be bound by the terms of the Agreement as a
Shareholder (as that term is defined in the Agreement).
DATED as of the ____ day of __________, 200_.
-----------------------------
Signature
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Printed Name
