EXHIBIT 2.4
STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT (this "Agreement"), dated as of February 14,
2005, is made by and among MLB Advanced Media, L.P., a Delaware limited
liability partnership ("Parent"), MLBAM Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of Parent (the "Purchaser"), and
Sports Capital Partners, L.P., Sports Capital Partners (Cayman Islands), L.P.
and Sports Capital Partners CEV, LLC (each, a "Stockholder" and collectively,
the "Stockholders").
WITNESSETH:
WHEREAS, concurrently with the execution and delivery of this
Agreement, Parent, the Purchaser and Xxxxxxx.xxx, Inc., a Delaware corporation
(the "Company"), have entered into an Agreement and Plan of Merger (as such
agreement may hereafter be amended from time to time, the "Merger Agreement"),
pursuant to which the Purchaser will be merged with and into the Company (the
"Merger"); and
WHEREAS, in furtherance of the Merger, Parent and the Company desire
that after the announcement of the execution of the Merger Agreement, the
Purchaser shall commence a cash tender offer (the "Offer") to purchase at the
Offer Price all outstanding shares of Common Stock (each as defined in Section 1
hereof), including all of the Securities (as defined in Section 2 hereof)
beneficially owned by each Stockholder; and
WHEREAS, as a condition to entering into the Merger Agreement, Parent
has required that each Stockholder agree, and each Stockholder has agreed, to
enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements contained herein, the
parties hereto agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Beneficially Owned" or "Beneficial Ownership" with respect to
any securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), including pursuant to any agreement, arrangement
or understanding, whether or not in writing. Without duplicative counting of the
same securities by the same holder, securities Beneficially Owned by a Person
(as hereinafter defined) shall include securities Beneficially Owned by all
other Persons with whom such Person would constitute a "group" within the
meaning of Section 13(d)(3) of the Exchange Act.
(b) "Common Stock" shall mean the Common Stock, $0.000225 par value,
of the Company.
(c) "Offer Price" shall mean cash in the amount of $1.10 per share
of Common Stock or, if greater, the price per share paid by the Purchaser in the
Offer.
(d) "Person" shall mean an individual, corporation, partnership,
limited liability company, joint venture, association, trust, unincorporated
organization or other entity.
(e) "Series F Preferred Stock" shall mean the Series F Senior
Cumulative Redeemable Preferred Stock, par value $0.000225 per share, of the
Company.
(f) Capitalized terms used and not defined herein shall have the
respective meanings ascribed to them in the Merger Agreement.
2. Tender of Shares.
(a) Each Stockholder hereby agrees (i) to convert (or cause the
record owner of such shares to convert), not later than the second business day
after commencement of the Offer pursuant to Section 1.01 of the Merger Agreement
and Rule 14d-2 under the Exchange Act, the number of shares of Series F
Preferred Stock set forth opposite such Stockholder's name on Schedule I hereto
(the "Preferred Stock"), into the number of shares of Common Stock into which
such Series F Preferred Stock is then convertible pursuant to its terms set
forth in the Company's Certificate of the Powers, Designations, Preferences and
Rights of the Series F Senior Cumulative Redeemable Preferred Stock (the
"Certificate of Designation"), which is attached hereto as Exhibit A, and (ii)
to validly tender (or cause the record owner of such shares to validly tender),
and not to withdraw, pursuant to and in accordance with the terms of the Offer,
not later than the fifth business day after commencement of the Offer pursuant
to Section 1.01 of the Merger Agreement and Rule 14d-2 under the Exchange Act,
all shares of Common Stock Beneficially Owned by such Stockholder, including all
shares of Common Stock acquired upon conversion of the Preferred Stock as
provided above (the "Existing Securities", and together with any other shares of
Common Stock acquired by such Stockholder in any capacity after the date hereof
and prior to the termination of this Agreement by means of purchase, dividend,
distribution, exercise of options, warrants or other rights to acquire Common
Stock or in any other way, the "Securities"). Each Stockholder hereby
acknowledges and agrees that Parent's and the Purchaser's obligation to accept
for payment and pay for the Securities in the Offer, including the Securities
Beneficially Owned by such Stockholder, is subject to the terms and conditions
of the Offer.
(b) Each Stockholder hereby permits Parent and the Purchaser to
publish and disclose in the Offer Documents and, if approval of the Company's
stockholders is required under applicable law, the Proxy Statement (including
all documents and schedules filed with the SEC) its identity and ownership of
the Securities and the nature of its commitments, arrangements and
understandings under this Agreement.
3. Additional Agreements.
(a) Voting Agreement. Each Stockholder shall, at any meeting of the
stockholders of the Company, however called, or in connection with any written
consent of the stockholders of the Company, vote (or cause to be voted) all
Securities then held of record or Beneficially Owned by such Stockholder, (i) in
favor of the Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the other actions
contemplated by the Merger Agreement and this Agreement and any actions required
in furtherance thereof and hereof; and (ii) against any proposal relating to an
Acquisition Proposal and against any action or agreement that would impede,
frustrate, prevent or nullify this
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Agreement, or result in a material breach in any respect of any covenant,
representation or warranty or any other obligation or agreement of the Company
under the Merger Agreement or which would result in any of the conditions set
forth in Annex I to the Merger Agreement or set forth in Article VI of the
Merger Agreement not being fulfilled.
(b) No Inconsistent Arrangements. Each Stockholder hereby covenants
and agrees that, except as contemplated by this Agreement, it shall not (i)
transfer (which term shall include, without limitation, any sale, gift, pledge
(other than a pledge which does not impair such Stockholder's ability to perform
under this Agreement) or other disposition), or consent to any transfer of, any
or all of the Securities or any interest therein, (ii) enter into any contract,
option or other agreement or understanding with respect to any transfer of any
or all of the Securities or any interest therein, (iii) grant any proxy,
power-of-attorney or other authorization in or with respect to the Securities,
(iv) deposit the Securities into a voting trust or enter into a voting agreement
or arrangement with respect to the Securities or (v) take any other action that
would in any way restrict, limit or interfere with the performance of its
obligations hereunder or the transactions contemplated hereby.
(c) No Solicitation. Each Stockholder hereby agrees, in the capacity
as a stockholder of the Company, that neither such Stockholder nor any of its
representatives or agents shall (and, if such Stockholder is a corporation,
partnership, trust or other entity, such Stockholder shall cause its officers,
directors, partners, employees, representatives and agents, including, but not
limited to, investment bankers, attorneys and accountants (collectively, the
"Stockholder Representatives"), not to), directly or indirectly, encourage,
solicit, participate in or initiate discussions or negotiations with, or provide
any information to, any corporation, partnership, person or other entity or
group (other (i) than Parent, the Purchaser or any of their respective
affiliates or representatives or (ii) any of the Stockholder Representatives)
concerning any proposal relating to an Acquisition Proposal. Each Stockholder
will immediately cease any existing activities, discussions or negotiations with
any parties conducted heretofore with respect to any proposal relating to an
Acquisition Proposal. Each Stockholder will immediately communicate to Parent
the terms of any proposal, discussion, negotiation or inquiry (and will disclose
any written materials received by such Stockholder in connection with such
proposal, discussion, negotiation or inquiry) and the identity of the party
making such proposal or inquiry, which it may receive in respect of any such
Acquisition Proposal. For the avoidance of doubt, the foregoing shall not
restrict or prohibit any action of any of the Stockholder Representatives, in
its capacity as a Stockholder Representative, to the extent such action is
permitted pursuant to and in accordance with the terms of this Agreement or the
Merger Agreement, is necessary to discharge its fiduciary duties, or is
otherwise required in accordance with applicable Law.
(d) Reasonable Efforts. Subject to the terms and conditions of this
Agreement, each of the parties hereto agrees to use all commercially reasonable
efforts to take, or cause to be taken, all actions, and to do, or cause to be
done, all things necessary, proper or advisable under applicable Laws to
consummate and make effective the transactions contemplated by this Agreement.
Each party shall use commercially reasonable efforts to promptly consult with
the other and provide any necessary information and material with respect to all
filings made by such party with any Governmental Entity in connection with this
Agreement and the transactions contemplated hereby.
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(e) Waiver of Dissenters' Rights. Each Stockholder hereby waives any
rights of appraisal or rights to dissent from the Merger that it may have.
4. Representations and Warranties of each Stockholder. Each Stockholder
hereby represents and warrants to Parent and the Purchaser that the following
statements contained in this Section 4 are correct and complete as of the date
of this Agreement, and will be complete and correct as of the Closing Date (as
though made then and as through the Closing Date):
(a) Ownership of Securities. Each Stockholder is the record and
Beneficial Owner of the Existing Securities set forth opposite such
Stockholder's name on Schedule I hereto. On the date hereof, the Existing
Securities set forth opposite each Stockholder's name on Schedule I hereto
constitute all of the Securities owned of record or Beneficially Owned by such
Stockholder.
(b) Power; Binding Agreement. Each Stockholder has the power and
authority to enter into and perform all of such Stockholder's obligations under
this Agreement. The execution, delivery and performance of this Agreement by
each Stockholder will not violate any other agreement to which such Stockholder
is a party including, without limitation, any voting agreement, proxy
arrangement, pledge agreement, shareholders agreement or voting trust. This
Agreement has been duly and validly executed and delivered by each Stockholder
and constitutes a valid and binding agreement of such Stockholder, enforceable
against such Stockholder in accordance with its terms, except that such
enforceability (i) may be limited by bankruptcy, insolvency, moratorium or other
similar laws affecting or relating to the enforcement of creditors' rights
generally and (ii) is subject to general principles of equity. There is no
beneficiary or holder of a voting trust certificate or other interest of any
trust of which any Stockholder is a trustee, or any party to any other agreement
or arrangement, whose consent is required and not received with respect to the
execution and delivery of this Agreement or the consummation by such Stockholder
of the transactions contemplated hereby.
(c) No Conflicts. To the knowledge of each Stockholder, except for
any filings under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended (the "HSR Act") and the Exchange Act (i) no filing with, and no permit,
authorization, consent or approval of, any Governmental Entity is necessary for
the execution and delivery of this Agreement by such Stockholder, the
consummation by such Stockholder of the transactions contemplated hereby and the
compliance by such Stockholder with the provisions hereof and (ii) none of the
execution and delivery of this Agreement by such Stockholder, the consummation
by such Stockholder of the transactions contemplated hereby or compliance by
such Stockholder with any of the provisions hereof, except in cases in which any
conflict, breach, default or violation described below would not have a material
adverse effect with the ability of such Stockholder to perform such
Stockholder's obligations hereunder, shall (A) conflict with or result in any
breach of any organizational documents applicable to such Stockholder, (B)
result in a violation or breach of, or constitute (with or without notice or
lapse of time or both) a default (or give rise to any third party right of
termination, cancellation, modification or acceleration) under, any of the
terms, conditions or provisions of any note, loan agreement, bond, mortgage,
indenture, license, contract, commitment, arrangement, understanding, agreement
or other instrument or obligation of any kind to which such Stockholder is a
party or by which such Stockholder or any of its properties or assets may be
bound, or (C) violate any order, writ, injunction, decree, judgment, order,
statute, rule or regulation applicable to such Stockholder or any of such
Stockholder's properties or assets.
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(d) No Liens. Except as permitted by this Agreement, the Existing
Securities set forth opposite each Stockholder's name on Schedule I hereto and
the certificates representing such securities are as of the date of this
Agreement, and will be as of the Closing Date, held by such Stockholder, or by a
nominee or custodian for the benefit of such Stockholder, free and clear of all
Liens, proxies, voting trusts or agreements, understandings or arrangements or
any other rights whatsoever, except for any such Liens or proxies arising
hereunder.
(e) No Finder's Fees. Stockholder has no liability or obligation to
pay broker's, finder's, financial adviser's or other similar fee or commission
to any broker, investment banker, financial advisor or other person in
connection with the transactions contemplated by this Agreement for which Parent
or the Purchaser could become liable or obligated.
5. Representations and Warranties of Parent and the Purchaser. Each of
Parent and the Purchaser hereby represents and warrants to each Stockholder that
the following statements contained in this Section 5 are correct and complete as
of the date of this Agreement, and will be complete and correct as of the
Closing Date (as though made then and as through the Closing Date):
(a) Power; Binding Agreement. Parent is a limited partnership duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its formation. Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
formation. Parent and the Purchaser each have the power and authority to enter
into and perform all of its obligations under this Agreement. The execution,
delivery and performance of this Agreement by each of Parent and the Purchaser
will not violate any other agreement to which either of them is a party. This
Agreement has been duly and validly executed and delivered by each of Parent and
the Purchaser and constitutes a valid and binding agreement of each of Parent
and the Purchaser, enforceable against each of Parent and the Purchaser in
accordance with its terms, except that such enforceability (i) may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or relating
to the enforcement of creditors' rights generally and (ii) is subject to general
principles of equity.
(b) No Conflicts. Except for filings under the HSR Act and the
Exchange Act, (i) no filing with, and no permit, authorization, consent or
approval of, any Governmental Entity is necessary for the execution of this
Agreement by each of Parent and the Purchaser, the consummation by each of
Parent and the Purchaser of the transactions contemplated hereby and the
compliance by Parent and the Purchaser with the provisions hereof and (ii) none
of the execution and delivery of this Agreement by each of Parent and the
Purchaser, the consummation by each of Parent and the Purchaser of the
transactions contemplated hereby or compliance by each of Parent and the
Purchaser with any of the provisions hereof, except in cases in which any
conflict, breach, default or violation described below would not interfere with
the ability of Parent or the Purchaser to perform their respective obligations
hereunder, shall (A) conflict with or result in any breach of any organizational
documents applicable to either of Parent or the Purchaser, (B) result in a
violation or breach of, or constitute (with or without notice or lapse of time
or both) a default (or give rise to any third party right of termination,
cancellation, modification or acceleration) under, any of the terms, conditions
or provisions of any note, loan agreement, bond, mortgage, indenture, license,
contract, commitment, arrangement, understanding, agreement or other instrument
or obligation of any kind to which either of Parent or the Purchaser is a party
or by which either of Parent or the Purchaser or any of their properties or
assets may be bound, or (C)
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violate any order, writ, injunction, decree, judgment, order, statute, rule or
regulation applicable to either of Parent or the Purchaser or any of their
properties or assets.
(c) No Finder's Fees. Neither Parent nor the Purchaser has any
liability or obligation to pay broker's, finder's, financial adviser's or other
similar fee or commission to any broker, investment banker, financial advisor or
other person in connection with the transactions contemplated by this Agreement
or the Merger Agreement for which any Stockholder could become liable or
obligated.
6. Release by Parent and the Purchaser; Covenant Not to Xxx.
(a) Effective as of the Effective Time, Parent and the Purchaser
(which includes its successor, the Surviving Corporation) each does fully and
forever release, remise and discharge each Stockholder from any and all actions,
charges, controversies, demands, causes of action, suits, arbitration, rights,
and claims whatsoever for debts, sums of money, legal fees and costs, including,
without limitation, attorneys' fees, and damages, whatsoever, known or unknown,
suspected or unsuspected, which Parent, the Purchaser and/or the Surviving
Corporation ever had, now has or shall have (whether in law, equity or
otherwise), against such Stockholder, for or by reason of any act, event,
matter, omission or thing whatsoever that occurred on or prior to the Effective
Time (except for any claim arising directly out of this Agreement), whether
arising under (i) any agreement or contract, written or oral, (ii) common law or
at equity or (iii) any federal, state, local or other applicable law, rule,
regulation, ordinance or public policy (collectively, the "Stockholder
Obligations").
(b) Parent and the Purchaser (which includes its successor, the
Surviving Corporation) each hereby represents and warrants to each Stockholder
that, as of the Effective Time, it has not caused or permitted to be filed on
its behalf, and Parent and the Purchaser (which includes its successor, the
Surviving Corporation) each agrees that, from and after the Effective Time, it
will not cause or permit to be filed on its behalf, any claim, charge, lawsuit,
grievance or cause of action against such Stockholder with respect to any
Stockholder Obligation.
7. Release by each Stockholder; Covenant Not to Xxx.
(a) Effective as of the Effective Time, each Stockholder does fully
and forever release, remise and discharge Parent and the Purchaser (which
includes its successor, the Surviving Corporation) from any and all actions,
charges, controversies, demands, causes of action, suits, arbitration, rights,
and claims whatsoever for debts, sums of money, legal fees and costs, including,
without limitation, attorneys' fees, and damages, whatsoever, known or unknown,
suspected or unsuspected, which any Stockholder ever had, now has or shall have
(whether in law, equity or otherwise), against Parent, the Purchaser and/or the
Surviving Corporation, for or by reason of any act, event, matter, omission or
thing whatsoever that occurred on or prior to the Effective Time (except for any
claim arising directly out of this Agreement and/or the Merger Agreement),
whether arising under (i) any agreement or contract, written or oral, (ii)
common law or at equity or (iii) any federal, state, local or other applicable
law, rule, regulation, ordinance or public policy (collectively, the "Parent
Obligations").
(b) Each Stockholder hereby represents and warrants to Parent and
the Purchaser (which includes its successor, the Surviving Corporation) that, as
of the Effective Time,
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it has not caused or permitted to be filed on its behalf, and each Stockholder
agrees that, from and after the Effective Time, it will not cause or permit to
be filed on its behalf, any claim, charge, lawsuit, grievance or cause of action
against Parent or the Purchaser (which includes its successor, the Surviving
Corporation) with respect to any Parent Obligation.
8. The Surviving Corporation. The Purchaser acknowledges and agrees, as
of the Effective Time, this Agreement and all of its obligation hereunder shall
be binding upon its successor, the Surviving Corporation, and inure to the
benefit of the other parties named herein and their respective successors and
permitted assigns.
9. Further Assurances. From time to time, at the other party's request
and without further consideration, each party hereto shall use commercially
reasonable efforts to execute and deliver such additional documents and take all
such further lawful action as may be necessary or desirable to consummate and
make effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement.
10. Stop Transfer. Each Stockholder shall not request that the Company
register the transfer (book-entry or otherwise) of any certificate or
uncertificated interest representing any of the Securities, unless such transfer
is made in compliance with this Agreement. In the event of a stock dividend or
distribution, or any change in the Common Stock by reason of any stock dividend,
split-up, recapitalization, combination, exchange of shares or the like, the
term "Securities" shall refer to and include the Securities as well as all such
stock dividends and distributions and any shares into which or for which any and
all of the Securities may be changed or exchanged.
11. Termination. All of the rights and obligations of the parties
hereunder, including, without limitation, the covenants and agreements contained
herein with respect to the Securities shall terminate upon the earlier to occur
of the Effective Time and the termination of the Merger Agreement in accordance
with its terms.
12. Miscellaneous.
(a) Entire Agreement. This Agreement and the Merger Agreement
constitute the entire agreement between the parties with respect to the subject
matter hereof and thereof and supersedes all other prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof.
(b) Binding Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties named herein and their respective successors
and permitted assigns. The obligations hereunder shall attach to the Securities
and shall be binding upon any person or entity to which legal or beneficial
ownership of the Securities shall pass, whether by operation of law or
otherwise, including, without limitation, each Stockholder's administrators or
successors.
(c) Assignment. Except for the assignment of this Agreement from the
Purchaser to the Surviving Corporation by the operation of law as of the
Effective Time, this Agreement shall not be assigned by operation of law or
otherwise without the prior written consent of each Stockholder, Parent and the
Purchaser, provided that Parent or the Purchaser may assign, in its respective
sole discretion, its rights and obligations hereunder to any affiliate of Parent
or any other MLB Entity without the consent of each Stockholder, but no such
assignment
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shall relieve Parent or the Purchaser of its obligations hereunder if such
assignee does not perform such obligations.
(d) Amendments, Waivers, Etc. This Agreement may not be amended,
changed, supplemented, waived or otherwise modified or terminated, except upon
the execution and delivery of a written agreement executed by each of the
parties hereto.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if given) by hand delivery or facsimile (with
a confirmation copy sent for next day delivery via courier service, such as
Federal Express), or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be delivered to the
respective parties at the following addresses:
If to any Stockholder:
Falconhead Capital, LLC
000 Xxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx and Xxxx Xxxxxxx
Facsimile: (000) 000-0000
If to Parent or the Purchaser:
MLB Advanced Media, L.P.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Facsimile: (000) 000-0000
With a copy to:
Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxx X. Xxxxxxx
Facsimile: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(f) Severability. Whenever possible, each provision or portion of
any provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of 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 will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in
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such jurisdiction as if such invalid, illegal or unenforceable provision or
portion of any provision had never been contained herein.
(g) Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore in the event
of any such breach the aggrieved party shall be entitled to the remedy of
specific performance of such covenants and agreements and injunctive and other
equitable relief in addition to any other remedy to which it may be entitled, at
law or in equity.
(h) Remedies Cumulative. All rights, powers and remedies provided
under this Agreement or otherwise available in respect hereof at law or in
equity shall be cumulative and not alternative, and the exercise of any thereof
by any party shall not preclude the simultaneous or later exercise of any other
such right, power or remedy by such party.
(i) No Waiver. The failure of any party hereto to exercise any
rights, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(j) No Third Party Beneficiaries. This Agreement is not intended to
be for the benefit of, and shall not be enforceable by, any person or entity who
or which is not a party hereto.
(k) Governing Law; Jurisdiction. This Agreement shall be governed
and construed in accordance with the laws of the State of New York, without
giving effect to the principles of conflicts of law thereof. Any court of
competent jurisdiction sitting within the State of New York, New York County
will be the exclusive jurisdiction and venue for any dispute arising out of or
relating to this Agreement.
(l) Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
(m) Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but all of which, taken
together, shall constitute one and the same agreement.
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IN WITNESS WHEREOF, Parent, the Purchaser and each Stockholder have
caused this Agreement to be duly executed as of the day and year first above
written.
MLB ADVANCED MEDIA, L.P.,
by MLB Advanced Media, Inc.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and
General Counsel
MLBAM ACQUISITION CORP.
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President and Chief
Executive Officer
SPORTS CAPITAL PARTNERS, L.P.
By: /s/ Xxxxx Xxxxxx
-----------------------------------
Name: Xxxxx Xxxxxx
Title: President
SPORTS CAPITAL PARTNERS (CAYMAN ISLANDS),
L.P.
By: /s/ Xxxxx Xxxxxx
-----------------------------------
Name: Xxxxx Xxxxxx
Title: President
SPORTS CAPITAL PARTNERS CEV, LLC
By: /s/ Xxxxx Xxxxxx
-----------------------------------
Name: Xxxxx Xxxxxx
Title: President
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SCHEDULE I
COMMON STOCK SERIES F PREFERRED
NAME OF STOCKHOLDER BENEFICIALLY OWNED BENEFICIALLY OWNED
------------------- ------------------ ------------------
Sports Capital Partners, L.P. 17,024 1,180,420
Sports Capital Partners (Cayman
Islands), L.P. 1,580 100,685
Sports Capital Partners CEV,
LLC 107,580 2,052,228
EXHIBIT A
CERTIFICATE OF DESIGNATION
(attached)
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 06/12/2001
010281165 - 2474671
XXXXXXX.XXX, INC.
CERTIFICATE OF THE POWERS,DESIGNATIONS,
PREFERENCES AND RIGHTS OF THE
SERIES F SENIOR CUMULATIVE REDEEMABLE PREFERRED STOCK,
PAR VALUE $0.000225 PER SHARE
Pursuant to Section 151 of the Delaware General Corporation Law
The undersigned, W.Xxxxxx Xxxxxx, Chief Executive Officer of
Xxxxxxx.xxx, Inc., a Delaware corporation(the "Corporation"),DOES HEREBY CERTIFY
that the following resolution, creating a series of 28,333,333 shares of
preferred stock was duly adopted by the Board of Directors of the Corporation
(the "Board of Directors"), on June 6, 2001.
WHEREAS, the Board of Directors is authorized, within the
limitations and restrictions stated in the Certificate of Incorporation of the
Corporation (the "Certificate of Incorporation"), to provide by resolution or
resolutions for the issuance of shares of preferred stock, par value $0.000225
per share, of the Corporation, in one or more classes or series with such voting
powers, full or limited, or no voting powers, and such designations, preferences
and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions as shall be stated and expressed in
the resolution or resolutions providing for the issuance thereof adopted by the
Board of Directors, and as are not stated and expressed in the Certificate of
Incorporation, or any amendment thereto, including (but without limiting the
generality of the foregoing) such provisions as may be desired concerning
voting, redemption, dividends, dissolution or the distribution of assets and
such other subjects or matters as may be fixed by resolution or resolutions of
the Board of Directors under the General Corporation Law of the State of
Delaware; and
WHEREAS, it is the desire of the Board of Directors, pursuant to its
authority as aforesaid, to authorize and fix the terms of a series of preferred
stock and the number of shares constituting such series.
NOW, THEREFORE BE IT RESOLVED:
1. Designation and Number of Shares. There shall be hereby created
and established a series of preferred stock designated as "Series F Senior
Cumulative Redeemable Preferred Stock" (the "Series F Preferred Stock"). The
authorized number of shares of Series F Preferred Stock shall be 28,333,333.
Capitalized terms used herein and not otherwise defined shall have the meanings
set forth in Section 10 below.
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2. Rank.
(a) The Series F Preferred Stock shall with respect to
dividends, distributions of assets and rights upon the occurrence of a
Liquidation rank senior to (i) all classes of common stock of the Corporation
(including, without limitation, the Common Stock, par value $0.000225 per share,
of the Corporation (the "Common Stock")) and (ii)each other class or series of
Capital Stock of the Corporation (the "Junior Stock") hereafter created which
does not expressly rank pari passu with or senior to the Series F Preferred
Stock.
(b) The Series F Preferred Stock shall, with respect to
payment of the Participation Payment upon the occurrence of a Sale Transaction,
rank senior to the Junior Stock.
(c) Notwithstanding anything to the contrary contained in the
Certificate of Incorporation, the vote of the holders of a majority of the
Series F Preferred Stock shall be a prerequisite to the designation or issuance
of any shares of Capital Stock ranking pari passu with or senior to the Series F
Preferred Stock in the event of a Liquidation or with respect to the payment of
dividends or the Participation Payment.
3. Dividends.
(a) If the Corporation declares and pays cash dividends on the
Common Stock then, in that event, the holders of shares of Series F Preferred
Stock shall be entitled to share in such dividends on a pro rata basis, as if
their shares had been converted into shares of Common Stock pursuant to Section
7(a) below immediately prior to the record date for determining the stockholders
of the Corporation eligible to receive such dividends.
(b) The holders of shares of Series F Preferred Stock shall be
entitled to receive, out of funds legally available therefor, cumulative
dividends at an annual rate equal to the excess(if any) of (i)9% of the Accreted
value over (ii) any cash dividends paid in accordance with Section 3(a) above,
calculated on the basis of a 360-day year, consisting of twelve 30-day months,
and such dividends shall accrue quarterly from the date of issuance thereof,
whether or not declared. Accrued and unpaid dividends shall compound on a
quarterly basis and be added to the Accreted Value of each share of Series F
Preferred Stock. The Board of Directors may fix a record date for the
determination of holders of shares of Series F Preferred Stock entitled to
receive payment of such dividends, which record date shall not be more than
sixty(60) days prior to the applicable dividend payment date. All accrued and
unpaid dividends, if any, shall, to the extent funds are legally available
therefor, be mandatorily paid immediately prior to the earlier to occur of (i) a
Liquidation, (ii) an optional conversion of shares of Series F Preferred Stock
pursuant to Section 7(a) below,(iii) an automatic conversion of shares of Series
F Preferred Stock pursuant to Section 7(b) below and (iv) a redemption of shares
of Series F Preferred Stock pursuant to Section 5 hereof (the "Mandatory
Dividend Payment Date").
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(c) On the Mandatory Dividend payment Date, all accrued
dividends shall be paid,(x) in the case of a Liquidation or a redemption
pursuant to Section 5 below, in cash, (y) in the case of an optional conversion
or an automatic conversion triggered by a Sale Transaction, in shares of Common
Stock or in cash, at the option of the holders of a majority of the shares of
the series F Preferred Stock. If dividends are to be paid in shares of Common
Stock pursuant to the preceding sentence, the value of such shares shall be
determined, (A) in the case of a Sale Transaction (other than as set forth in
clause (B), below), by the Net Per Share Price paid for shares of Common Stock
on such Sale Transaction or (B) in the case of a Sale Transaction in which no
Net Per Share Price is paid for shares of Common Stock or in the case of an
optional conversion of shares of Series F Preferred Stock, in good faith by the
Board of Directors.
4. Liquidation Preference.
(a) Participation Payment. Upon the occurrence of a
Liquidation, the holders of shares of Series F Preferred Stock shall be entitled
(i) to be paid for each share of Series F Preferred Stock held thereby, out of,
but only to the extent of, the assets of the Corporation legally available for
distribution to its stockholders, an amount equal to the sum of (A) the Accreted
Value per share plus (B) as provided in Section 3 above, all accrued and unpaid
dividends, if any, with respect to each share of Series F Preferred Stock, up to
the date fixed for such liquidation (together with the Accreted Value, the
"Participation Payment"), before any payment or distribution is made to any
Junior Stock, and (ii) such number of fully paid and non-assessable shares of
Common Stock as is equal to the product of the number of shares of Series F
Preferred Stock held thereby and the quotient of (X) the Accreted Value divided
by (Y) the conversion price of $0.60 per share, subject to the adjustment as
provided in Section 7(d) below. If the assets of the Corporation available for
distribution to the holders of shares of Series F Preferred Stock shall be
insufficient to permit payment in full to such holders of the sums to which such
holders are entitled to receive in such case, then all of the assets available
for distribution to holders of shares of Series F Preferred Stock shall be
distributed among and paid to such holders ratably in proportion to the amounts
that would be payable to such holders if such assets were sufficient to permit
payment in full.
(b) No Additional payment. After the holders of all shares of
Series F Preferred Stock shall have been paid in full the amounts to which they
are entitled in Section 4(a) above, the holders of shares of Series F Preferred
Stock shall not be entitled to any further participation in any distribution of
assets of the Corporation and the remaining assets of the Corporation shall be
distributed to the holders of the Junior Stock.
(d) Notice. Written notice of a Liquidation stating a payment
or payments and the place where such payment or payments shall be payable, shall
be delivered in person, mailed by certified mail, return receipt requested,
mailed by overnight mail or sent by telecopier, not less than ten (10) days
prior to the earliest payment date stated therein, to the holders of record of
shares of Series F Preferred Stock,
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such notice to be addressed to each such holder at its address as shown by the
records of the Corporation.
(e) Sale Transactions. A Sale Transaction shall be deemed to
be a Liquidation pursuant to this Section 4, and the shares of Series F
Preferred Stock shall automatically convert into the consideration specified in
Section 7(b) hereof.
5. Redemption.
(a) Optional Redemption.
(i) The Corporation shall not have any right to redeem
any shares of Series F Preferred Stock prior to June 11, 2003. On and after June
12, 2003, but prior of June 11, 2006 (any such date, an "Optional Redemption
Measurement Date"), if the Redemption Per Share Price on such Optional
Redemption Measurement Date exceeds the amounts set forth in the chart that
follows with respect to such applicable Optional Redemption Date (expressed as a
percentage of the Conversion Price), (the "Hurdle Rate"), the Corporation shall
have the right, as its sole option and election, to redeem (unless otherwise
prevented by law) all, but not less than all, of the shares of Series F
Preferred Stock in cash, at a price per share equal to the greater of either (i)
the sum of (x) the Accreted Value plus (y) as provided in Section 3 above, all
accrued and unpaid dividends through the Optional Redemption Measurement Date,
if any, with respect to each share of Series F Preferred Stock, or (ii) the
product of the Per Share Price as of the Optional Redemption Measurement Date
and the number of shares of common Stock into which the Series F Preferred Stock
is convertible on such date (as provided in Section 7(a) below, in immediately
available funds:
HURDLE RATE AS A PERCENTAGE
IF REDEEMED DURING THE PERIOD OF THE CONVERSION PRICE
----------------------------- ---------------------------
June 12, 2003 to June 11, 2004 200%
June 12, 2004 to June 11, 2005 250%
June 12, 2005 to June 11, 2006 300%
(ii) Written notice of any election by the Corporation
to redeem the shares of Series F Preferred Stock pursuant to this Section 5(a)
and the date selected for such redemption (the "Optional Redemption Date") shall
be delivered in person, mailed by certified mail, return receipt requested,
mailed by overnight mail or sent by telecopier not less than thirty (30), nor
more than sixty (60), days prior to such Optional Redemption Date to the holders
of record of the shares of Series F Preferred Stock such notice to be
addressed to each such holder at its address as shown in the records of the
Corporation. The total sum payable per share of Series F Preferred Stock to be
redeemed (the "Optional Redeemed Shares") on such Optional Redemption Date is
referred to as the "Optional Redemption Price," and the payment to be made on
such Optional Redemption Date for the Optional Redeemed Shares is referred to as
the "Optional Redemption Payment." The Optional Redemption Payment shall be made
by
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wire transfer of immediately available funds to accounts designated in writing
by the holders of shares of Series F Preferred Stock. Upon notice from the
Corporation, each holder of shares of Series F Preferred Stock so redeemed shall
promptly surrender to the Corporation, at any place where the Corporation shall
maintain a transfer agent for its shares of Series F Preferred Stock,
certificates representing the shares so redeemed, duly endorsed in blank or
accompanied by proper instruments of transfer. Notwithstanding anything to the
contrary set forth in this Certificate of Designation, any holder of Series F
Preferred Stock may convert its shares of Series F Preferred Stock pursuant to
Section 7(a) until the Optional Redemption Price has been paid by the
Corporation to any such holders hereof.
(iii) Termination of Rights. If shares of Series F
Preferred Stock are to be redeemed pursuant to Section 5(a) above, then on and
after such Optional Redemption Date, all rights of any holder of such shares of
Series F Preferred Stock shall cease and terminate; and such Optional Redeemed
Shares shall no longer be deemed to be outstanding, whether or not the
certificates representing such shares have been received by the Corporation;
provided, however, that, if the Corporation defaults in the payment of the
Optional Redemption Payment, the rights of the holders of such shares of Series
F Preferred Stock shall continue until the Corporation cures such default.
(b) Automatic Redemption. On the date that is five (5) years
after the date shares of Series F Preferred Stock are initially issued (the
"Automatic Redemption Date"), such shares of Series F Preferred Stock shall
automatically, with no further action required to be taken by the Corporation or
the holder thereof, be redeemed (unless otherwise prevented by law) in cash, at
a redemption price per share equal to the greater of (i) the Accreted Value
plus, as provided in Section 3 above, all accrued and unpaid dividends through
the Automatic Redemption Date, if any, with respect to each share of Series F
Preferred Stock or (ii) the product of the Per Share Price and the number of
shares of Common Stock into which the Series F Preferred Stock is convertible on
such Automatic Redemption Date. Written notice of such Automatic Redemption Date
shall be delivered in person, mailed by certified mail, return receipt requested
, mailed by overnight mail or sent by telecopier not less than thirty (30), nor
more than sixty (60), days prior to the Automatic Redemption Date to the holders
of record of the shares of Series F Preferred Stock such notice to be addressed
to each such holder at its address as shown in the records of the Corporation.
The total sum payable per share of Series F Preferred Stock to be redeemed (the
"Redeemed Shares") on the Automatic Redemption Date is referred to as the
"Redemption Price," and the payment to be made on the Automatic Redemption Date
for the Redeemed Shares is referred to as the "Redemption Payment." The
Redemption Payment shall be made by wire transfer of immediately available funds
to accounts designated in writing by the holders of shares of Series F Preferred
Stock. Upon notice from the Corporation, each holder of shares of Series F
Preferred Stock so redeemed shall promptly surrender to the Corporation, at any
place where the Corporation shall maintain a transfer agent for its shares of
Series F Preferred Stock, certificates representing the shares so redeemed, duly
endorsed in blank or accompanied by proper instruments of transfer.
Notwithstanding anything to the contrary set forth in this Certificate of
Designation, any holder of Series F Preferred Stock may
6
convert its shares of Series F Preferred Stock pursuant to Section 7(a) hereof
until the Redemption Price has been paid by the Corporation to any such holders
hereto.
(i) Termination of Rights. If shares of Series F
Preferred Stock are to be redeemed pursuant to Section 5(b) above, then, except
as set forth in Section 5(b)(ii) below, on and after the Automatic Redemption
Date, all rights of any holder of such shares of Series F Preferred Stock shall
cease and terminate; and such Redeemed Shares shall no longer be deemed to be
outstanding, whether or not the certificates representing such shares have been
received by the Corporation; provided, however, that, if the Corporation
defaults in the payment of the Redemption Payment, the rights of the holders of
such shares of Series F Preferred Stock shall continue until the Corporation
cures such default.
(ii) Insufficient Funds for Redemption. If the funds of
the Corporation available for redemption of the Redeemed Shares on the Automatic
Redemption Date are insufficient to redeem the Redeemed Shares on such date, the
holders of Redeemed Shares shall share ratably in any funds available by law for
redemption of such shares according to the respective amounts which would be
payable with respect to the number of shares owned by them if the shares to be
so redeemed on such Automatic Redemption Date were redeemed in full. Any
Redeemed Shares that the Corporation is not able to redeem on the Automatic
Redemption Date due to insufficient funds shall continue to be outstanding until
redeemed and dividends on such shares shall continue to accrue and cumulate
until redeemed. The Corporation shall in good faith use all reasonable efforts
as expeditiously as possible to eliminate, or obtain an exception, waiver or
exemption from, any and all restrictions that prevented the Corporation from
paying the Redemption Price and redeeming all of the Redeemed Shares. At any
time thereafter when additional funds of the Corporation are available by law
for the redemption of the Redeemed Shares, such funds shall be used, at the end
of the next succeeding fiscal quarter, to redeem the balance of such shares, or
such portion thereof for which funds are available, on the basis set forth
above.
6. Voting Rights.
(a) In addition to the voting rights to which the holders of
Series F Preferred Stock are entitled under or granted by Delaware law, the
holders of Series F Preferred Stock shall be entitled to vote, in person or by
proxy, at a special or annual meeting of stockholders or in any written consent
in lieu of meeting, on all matters entitled to be voted on by holders of shares
of Common Stock voting together as a single class with the Common Stock (and
with other shares entitled to vote thereon, if any). With respect to any such
vote, each share of Series F Preferred Stock shall entitle the holder thereof to
cast that number of votes as is equal to the number of votes that such holder
would be entitled to cast had such holder converted its shares of Series F
Preferred Stock into shares of Common Stock pursuant to Section 7(a) below on
the record date for determining the stockholders of the Corporation eligible to
vote on any such matters.
(b) From and after the date hereof, General Atlantic Partners
74, L.P. ("GAP LP"), GAP Coinvestment Partners II, L.P. ("GAP
7
Coinvestment"), GapStar, LLC("GapStar") and/or any Affiliate thereof in the
aggregate own at least a majority of the outstanding shares of Series F
Preferred Stock, then the holders of shares of Series F Preferred Stock, voting
as a separate class, shall be entitled to elect two directors of the
Corporation(the "Series F Directors"). In addition, from and after August 15,
2001, if GAP LP, GAP Coinvestment and GapStar and/or any Affiliate thereof in
the aggregate own at least a majority of the outstanding shares of Series F
Preferred Stock, then the holders of shares of Series F Preferred Stock, voting
as a separate class, shall be entitled to elect one additional director of the
Corporation (the "Additional Series F Director").
(c) Extraordinary Actions. Notwithstanding anything otherwise
to the contrary contained in this Certificate of Designation or the Certificate
of Incorporation, provided that fifty percent(50%) of the shares of Series F
Preferred Stock remain outstanding, none of the following actions may be
taken, directly or indirectly by the Corporation ("Extraordinary Actions")
without the approval of the holders of a majority of all issued and outstanding
shares of Series F Preferred Stock voting together as a single class, in person
or by proxy, at a special or annual meeting or by written consent:
(i) any modification, amendment or alteration or change
to the Certificate of Incorporation or the bylaws of the Corporation that would
affect the rights, preferences, powers (including, without limitation, voting
powers)and privileges of the Series F Preferred Stock;
(ii) the issuance, reservation for issuance or
authorization of any Capital Stock of the Corporation (excluding shares issuable
upon the exercise conversion of the Series F Preferred Stock or any other
securities convertible into or exchangeable for shares of capital stock issued
and outstanding on the date hereof and shares of Common Stock issuable upon
exercise of options granted pursuant to the Stock Option Plan), or any increase
or decrease in the authorized number of shares of Series F Preferred Stock;
(iii) the redemption for cash of any Capital Stock that
is junior to, or pari passu with, the Series F Preferred Stock (other than the
repurchase of unvested Common Stock from employees, directors or consultants
upon termination of their employment with, or service to, the Corporation);
(iv) the declaration or payment of any dividend or other
distribution on or in respect of any Capital Stock that is junior to or pari
passu with the Series F Preferred Stock (other than dividends payable to holders
of Series F Preferred Stock and stock dividends);
(v) any action that results in a deemed dividend to the
Series F Preferred Stock under section 305 of the Internal Revenue Code;
8
(vi) the Corporation or any of its Subsidiaries issuing,
assuming or otherwise becoming liable for any long term debt in excess of
$3,000,000 in the aggregate;
(vii) the Corporation making or causing any Subsidiaries
of the Corporation to make, an aggregate amount of capital expenditures in
excess of (i) $1,500,000 individually or $4,000,000 in the aggregate in any
12-month period, or (ii) $1,000,000, not included in the annual operating budget
(viii) any change in the material accounting methods or
policies of the Corporation;
(ix) approval of the Liquidation of the Corporation or
the approval, authorization or recommendation of any Sale Transaction; and
(x) any modification of the number of directors
constituting the entire Board of Directors or any amendment or modification of
this Section 6(c).
(d) In order to effect the provisions of Section 6(b), the
Series F Preferred Stock shall vote together as a single class with the Common
Stock (and all other classes and series of stock of the Corporation entitled to
vote thereon, if any) with respect to the election of all of the directors of
the Corporation. If the conditions set forth in the first sentence of Section
6(b) necessary for the holders of shares of Series F preferred Stock to vote as
a separate class for the election of directors are not satisfied, the Series F
Preferred Stock shall vote together as a single class with the Common Stock (and
all other classes and series of stock of the Corporation entitled to vote
thereon, if any) with respect to the election of all of the directors of the
Corporation elected by such holders. At any meeting held for the purpose of
electing directors or approving an Extraordinary Action, at a time when the
holders of shares of Series F Preferred Stock are entitled to vote as a separate
class for the election of directors and approval of an Extraordinary Action,
the presence in person or by proxy of the holders of a majority of the shares of
Series F Preferred Stock then outstanding shall constitute a quorum of the
Series F Preferred Stock for the election of the Series F Directors and the
Additional Series F Director and approval of an Extraordinary Action; the
holders of shares of Series F Preferred Stock shall be entitled to cast one vote
per share of Series F Preferred Stock in any such election; and the Series F
Directors and the Additional Series F Director shall be elected, or the
Extraordinary Action approved by the affirmative vote of the holders of a
majority of the outstanding shares of Series F Preferred Stock. A vacancy in the
directorship filled by the holders of the Series F Preferred Stock voting as a
separate class pursuant to this Section 6(d) shall be filled only by vote or
written consent of the holders of shares of Series F Preferred Stock.
9
7. Conversion.
(a) Optional Conversion. Any holder of shares of Series F
Preferred Stock shall have the right, at its option, at any time and from time
to time, to convert, subject to the terms and provisions of this Section 7, any
or all of such holder's shares of Series F Preferred Stock into such number of
fully paid and non-assessable shares of Common Stock as is equal to the product
of the number of shares of Series F Preferred Stock being so converted
multiplied by the quotient of (i) the Accreted Value divided by (ii) the
conversion price of $0.60 per share, subject to adjustment as provided in
Section 7(d) below (such price as in clause (ii), the "Conversion Price"). Such
conversion right shall be exercised by the surrender of certificate(s)
representing the shares of Series F Preferred Stock to be converted to the
Corporation at any time during usual business hours at its principal place of
business to be maintained by it (or such other office or agency of the
Corporation as the Corporation may designate by notice in writing to the holders
of shares of Series F Preferred Stock), accompanied by written notice that the
holder elects to convert such shares of Series F Preferred Stock and specifying
the name of names (with address) in which a certificate or certificates for
shares of Common Stock are to be issued and (if so required by the Corporation)
by a written instrument or instruments of transfer in form reasonably
satisfactory to the Corporation duly executed by the holder or its duly
authorized legal representative and transfer tax stamps or funds therefor, if
required pursuant to Section 7(j) below. All certificates representing shares
of Series F Preferred Stock surrendered for conversion shall be delivered to the
Corporation for cancellation and canceled by it. As promptly as practicable
after the surrender of any shares of Series F Preferred Stock, the Corporation
shall (subject to compliance with the applicable provisions of federal and state
securities laws) deliver to the holder of such shares so surrendered
certificate(s) representing the number of fully paid and non-assessable shares
of Common Stock into which such shares are entitled to be converted and, to the
extent funds are legally available therefor, an amount equal to all accrued and
unpaid dividends, if any, payable with respect to such shares in accordance with
Section 3 above. At the time of the surrender of such certificate(s), the Person
in whose name any certificate(s) for shares of Common Stock shall be issuable
upon such conversion shall be deemed to be the holder of record of such shares
of Common Stock on such date, notwithstanding that the share register of the
Corporation shall then be closed or that the certificates representing such
Common Stock shall not then be actually delivered to such Person.
(b) Automatic Conversion.
(i) Simultaneously with the closing of a Sale
Transaction, each outstanding share of Series F Preferred Stock shall be
automatically converted, with no further action required to be taken by the
Corporation or the holder thereof, into the following:
(A) the Participation Payment; and
(B) the number of fully paid and non-assessable
shares of Common Stock equal to the product of the number of shares of Series F
10
Preferred Stock being converted and the quotient of (x) the Accreted Value
divided by (y) the Conversion Price then in effect (after giving effect to any
adjustments pursuant to Section 7(d) below).
(ii) The Participation Payment set forth in Section
7(b)(i) above shall be in addition to and not in lieu of accrued and unpaid
dividends, if any, payable in accordance with Section 3 above and shall be
payable, to the extent funds are legally available therefor, in the case of a
Sale Transaction, in cash or, at the option of the holders of a majority of
shares of Series F Preferred Stock, in shares of Common Stock if such shares
remain outstanding following the Sale Transaction or in the consideration to be
received by holders of shares of Common Stock. If the Participation Payment is
to be paid in shares of Common Stock, the value of such shares of Common Stock
shall be determined (A) in the case of a Sale Transaction (other than as set
forth in clause (B), below), by the Net Per Share Price paid for shares of
Common Stock in such Sale Transaction, or (B) in the case of a Sale Transaction
in which no Net Per Share Price is paid for shares of Common Stock, in good
faith by the Board of Directors.
(iii) Any securities of the surviving Person to be
delivered to the holders of shares of Series F Preferred Stock pursuant to this
Section 7(b) shall be valued as follows:
(A) With respect to securities that do not
constitute "restricted securities," as such term is defined in Rule 144(a)(3)
promulgated under the Securities Act, the value shall be deemed to be the
Current Market Price of such securities as of three (3) days prior to the date
of distribution.
(B) With respect to securities that constitute
"restricted securities," as such term is defined in Rule 144(a)(3) promulgated
under the Securities Act, and that are of the same class or series as securities
that are publicly traded, the value shall be adjusted to make an appropriate
discount from the value as set forth in Section 7(b)(iii)(A) above to reflect
the appropriate fair market value thereof, as mutually determined by the Board
of Directors and the holders of a majority of the shares of Series F Preferred
Stock, or if there is no active public market with respect to such class or
series of securities, such securities shall be valued in accordance with Section
7(b)(iii)(A) above, giving appropriate weight, if any, to such restriction as
determined in good faith by the Board of Directors.
(iv) Immediately upon conversion as provided herein,
each holder of shares of Series F Preferred Stock shall be deemed to be the
holder of record of the Common Stock issuable upon conversion of such holder's
shares of Series F Preferred Stock, notwithstanding that the share register of
the Corporation shall then be closed or that certificates representing the
Common Stock shall not then actually be delivered to such Person. Upon written
notice from the Corporation, each holder of shares of Series F Preferred
Stock so converted shall promptly surrender to the Corporation at its principal
place of business to be maintained by it (or at such other office or agency of
the Corporation as the Corporation may designate by such notice to
11
the holders of shares of Series F Preferred Stock) certificates representing the
shares so converted.
(c) Termination of Rights. On the date of such optional
conversion pursuant to Section 7(a) above or of such automatic conversion
pursuant to Section 7(b) above, all rights with respect to the shares of Series
F Preferred Stock so converted, including the rights, if any, to receive notices
and vote, shall terminate, except only the rights of holders thereof to (i)
receive certificates for the number of shares of Common Stock into which such
shares of Series F Preferred Stock have been converted, (ii) receive the
Participation Payment in the case of an automatic conversion pursuant to Section
7(b) above, (iii) the payment of dividends, if any, pursuant to Section 3 above
and (iv) exercise the rights to which they are entitled as holders of Common
Stock.
(d) Antidilution Adjustments. The Conversion Price, and the
number and type of securities to be received upon conversion of shares of Series
F Preferred Stock, shall be subject to adjustment as follows:
(i) Dividend, Subdivision, Combination or
Reclassification of Common Stock. In the event that the Corporation shall at any
time or from time to time, prior to conversion of shares of Series F Preferred
Stock (w) pay a dividend or make a distribution on the outstanding shares of
Common Stock payable in Capital Stock, (x) subdivide the outstanding shares of
Common Stock into a larger number of shares,(y) combine the outstanding shares
of Common Stock into a smaller number of shares or (z) issue any shares of its
Capital Stock in a reclassification of the Common Stock (other than any such
event for which an adjustment is made pursuant to another clause of this
Section 7(d)), then, and in each such case, the Conversion Price in effect
immediately prior to such event shall be adjusted (and any other appropriate
actions shall be taken by the Corporation) so that the holder of any share of
Series F Preferred Stock thereafter surrendered for conversion shall be entitled
to receive the number of shares of Common Stock or other securities of the
Corporation that such holder would have owned or would have been entitled to
receive upon or by reason of any of the events described above, had such share
of Series F Preferred Stock been converted immediately prior to the occurrence
of such event. An adjustment made pursuant to this Section 7 (d)(i) shall
become effective retroactively (x) in the case of any such dividend or
distribution, to a date immediately following the close of business on the
record date for the determination of holders of Common Stock entitled to receive
such dividend or distribution or (y) in the case of any such subdivision,
combination or reclassification, to the close of business on the day upon which
such corporate action becomes effective.
(ii) Issuance of Common Stock or Common Stock Equivalent
below Conversion Price.
(A) If the Corporation shall at any time or from
time to time prior to conversion of shares of Series F Preferred Stock, issue or
sell any shares of Common Stock or Common Stock Equivalents at a price per share
of Common Stock (the "New Issue Price") that is less than the Conversion Price
then in effect as of
12
the record date or Issue Date (as defined below), as the case may be (the
"Relevant Date") treating the price per share of Common Stock, in the case of
the issuance of any Common Stock Equivalent, as equal to (X) the sum of the
price for such Common Stock Equivalent plus any additional consideration payable
(without regard to any anti-dilution adjustments) upon the conversion, exchange
or exercise of such Common Stock Equivalent divided by (y) the number of shares
of Common Stock initially underlying such Common Stock Equivalent), other than
(A) issuances or sales for which an adjustment is made pursuant to another
clause of this Section 7 (d) and (B) issuances in connection with an Excluded
Transaction, then and in each such case, the Conversion price then in effect
shall be adjusted to equal the New Issue Price.
(B) Such adjustment shall be made whenever such shares of
Common Stock or Common Stock Equivalents are issued, and shall become effective
retroactively (X) in the case of an issuance to the stockholders of the
Corporation, as such, to a date immediately following the close of business on
the record date for the determination of stockholders entitled to receive such
shares of Common Stock or Common Stock Equivalents and (y) in all other cases,
on the date (the "Issue Date") of such issuance; provided, however, that the
determination as to whether an adjustment is required to be made pursuant to
this Section 7 (d)(ii) shall only be made upon the issuance of such shares of
Common Stock or Common Stock Equivalents, and not upon the issuance of any
security into which the Common Stock Equivalents convert, exchange or may be
exercised.
(C) In case at any time any shares of Common Stock or Common
Stock Equivalents or any rights or options to purchase any shares of Common
Stock or Common Stock Equivalents shall be issued or sold for cash, the
consideration received therefor shall be deemed to be the amount received by the
corporation therefor, without deduction therefrom of any expenses incurred or
any underwriting commissions or concessions or discounts paid or allowed by the
Corporation in connection therewith. In case any shares of Common Stock or
Common Stock Equivalents or any rights or options to purchase any Common Stock
or Common Stock Equivalents shall be issued or sold for a consideration other
than cash, the amount of the consideration other than cash received by the
Corporation shall be deemed to be the fair market value of such consideration,
without deduction therefrom of any expenses incurred or any underwriting
commissions or concessions or discounts paid or allowed by the Corporation in
connection therewith, as determind in good faith by the Board of Directors.
(D) If any Common Stock Equivalents (or any portions thereof)
which shall have given rise to an adjustment pursuant to this Section 7(d)(ii)
shall have expired or terminated without the exercise thereof and/or if by
reason of the terms of such Common Stock Equivalents there shall have been an
increase or increases, with the passage of time or otherwise, in the price
payable upon the exercise or conversion thereof, then the Conversion Price
hereunder shall be readjusted (but to no greater extent than originally
adjusted) in order to (1) eliminate from the computation any additional shares
of Common Stock corresponding to such Common Stock Equivalents as shall have
expired or terminated, (2) treat the additional shares of Common Stock, if any,
13
actually issued or issuable pursuant to the previous exercise of such Common
Stock Equivalents as having been issued for the consideration actually received
and receivable therefor and (3) treat any of such Common Stock Equivalents which
remain outstanding as being subject to exercise or conversion on the basis of
such exercise or conversion price as shall be in effect at the time.
(iii) Certain Distributions. In case the
Corporation shall at any time or from time to time, prior to conversion of
shares of Series F Preferred Stock, distribute to all holders of shares of the
Common Stock (including any such distribution made in connection with a merger
or consolidation in which the Corporation is the resulting or surviving Person
and the Common Stock is not changed or exchanged) cash, evidences of
indebtedness of the Corporation or another issuer, securities of the Corporation
or another issuer or other assets (excluding cash dividends in which holders of
shares of Series F Preferred Stock participate, in the manner provided in
Section 3, dividends payable in shares of Common Stock for which adjustment is
made under another paragraph of this Section 7(d) and any distribution in
connection with an Excluded Transaction) or rights or warrants to subscribe for
or purchase of any of the foregoing, then, and in each such case, the Conversion
Price then in effect shall be adjusted (and any other appropriate actions shall
be taken by the Corporation) by multiplying the Conversion Price in effect
immediately prior to the date of such distribution by a fraction (x) the
numerator of which shall be the Current Market Price of the Common Stock
immediately prior to the date of distribution less the then fair market value
(as determined by the Board of Directors in the exercise of their fiduciary
duties) of the portion of the cash, evidences of indebtedness, securities or
other assets so distributed or of such rights or warrants applicable to one
share of Common Stock and (y) the denominator of which shall be the Current
Market Price of the Common Stock immediately prior to the date of distribution
(but such fraction shall not be greater than one); provided, however, that no
adjustment shall be made with respect to any distribution of rights or warrants
to subscribe for or purchase securities of the Corporation if the holder of
shares of Series F Preferred Stock would otherwise be entitled to receive such
rights or warrants upon conversion at any time of shares of Series F Preferred
Stock into Common Stock. Such adjustment shall be made whenever any such
distribution is made and shall become effective retroactively to a date
immediately following the close of business on the record date for the
determination of stockholders entitled to receive such distribution.
(iv) Other Changes. In case the Corporation at any
time or from time to time, prior to the conversion of shares of Series F
Preferred Stock, shall take any action affecting its Common Stock similar to or
having an effect similar to any of the actions described in any of Sections
7(d)(i), (ii) or (iii) above or Section 7(g) below (but not including any action
described in any such Section) and the Board of Directors in good faith
determines that it would be equitable in the circumstances to adjust the
Conversion Price as a result of such action, then, and in each such case, the
Conversion Price shall be adjusted in such manner and at such time as the Board
of Directors in good faith determines would be equitable in the circumstances
(such determination to be evidenced in a resolution, a certified copy of which
shall be mailed to the holders of shares of Series F Preferred Stock).
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(v) No Adjustment. Notwithstanding anything herein to the
contrary, no adjustment under this Section 7(d) need be made to the Conversion
Price if the Corporation receives written notice from holders of a majority of
the outstanding shares of Series F Preferred Stock that no such adjustment is
required.
(e) Abandonment. If the Corporation shall take a record of the
holders of its Common Stock for the purpose of entitling them to receive a
dividend or other distribution, and shall thereafter and before the distribution
to stockholders thereof legally abandon its plan to pay or deliver such dividend
or distribution, then no adjustment in the Conversion Price shall be required by
reason of the taking of such record.
(f) Certificate as to Adjustments. Upon any adjustment in the
Conversion Price, the Corporation shall within a reasonable period (not to
exceed ten (10) days) following any of the foregoing transactions
deliver to each registered holder of shares of Series F Preferred Stock a
certificate, signed by an executive officer of the Corporation, setting forth in
reasonable detail the event requiring the adjustment and the method by which
such adjustment was calculated and specifying the increased or decreased
Conversion Price then in effect following such adjustment.
(g) Reorganization, Reclassification. In case of any merger or
consolidation of the Corporation (other than a Sale Transaction except as
provided below) or any capital reorganization, reclassification or other change
of outstanding shares of Common Stock (other than a change in par value, or from
par value to no par value, or from no par value to par value)(each, a
"Transaction"), the Corporation shall execute and deliver to each holder of
shares of Series F Preferred Stock at least twenty (20) Business Days prior to
effecting such Transaction a certificate, signed by an executive officer of the
Corporation, stating that the holder of each share of Series F Preferred Stock
shall have the right to receive in such Transaction, in exchange for each
share of Series F Preferred Stock, a security identical to (and not less
favorable than) the Series F Preferred Stock, and provision shall be made
therefor in the agreement, if any, relating to such Transaction.
(h) Notices. In case at any time or from time to time:
(w) the Corporation shall declare a dividend (or any other
distribution) on its shares of Common Stock;
(x) the Corporation shall authorize the granting to the holders
of its Common Stock rights or warrants to subscribe for or purchase any shares
of Capital Stock of any class or of any other rights or warrants;
(y) there shall be any Transaction; or
(z) there shall occur a Sale Transaction;
then the Corporation shall mail to each holder of shares of Series F Preferred
Stock at such holder's address as it appears on the transfer books of the
Corporation, as promptly
15
as possible but in any event at least ten (10) days prior to the applicable date
hereinafter specified, a notice stating (A) the date on which a record is to be
taken for the purpose of such dividend, distribution or granting of rights or
warrants or, if a record is not to be taken, the date as of which the holders of
Common Stock of record to be entitled to such dividend, distribution or granting
of rights or warrants are to be determined, or (B) the date on which such
Transaction, or Sale Transaction is expected to become effective and the date as
of which it is expected that holders of Common Stock of record shall be entitled
to exchange their Common Stock for shares of stock or other securities or
property of cash deliverable upon such Transaction or Sale Transaction.
Notwithstanding the foregoing, in the case of any event to which Section 7(g)
above is applicable, the Corporation shall also deliver the certificate
described in Section 7(g) above to each holder of shares of Series F Preferred
Stock at least twenty (20) Business Days' prior to effecting such reorganization
or reclassification as aforesaid.
(i) Reservation of Common Stock. The Corporation shall at all times
reserve and keep available for issuance upon the conversion of shares of Series
F Preferred Stock, such number of its authorized but unissued shares of Common
Stock as will from time to time be sufficient to permit the conversion of all
outstanding shares of Series F Preferred Stock, and shall take all action to
increase the authorized number of shares of Common Stock if at any time there
shall be insufficient authorized but unissued shares of Common Stock to permit
such reservation or to permit the conversion of all outstanding shares of Series
F Preferred Stock; provided that (x) the holders of shares of Series F Preferred
Stock vote such shares in favor of any such action that requires a vote of
stockholders and (y) such holders cause the Series F Director to vote in favor
of any such action that requires a vote of the Board of Directors.
(j) No Conversion Tax or Charge. The issuance or delivery of
certificates for Common Stock upon the conversion of shares of Series F
Preferred Stock shall be made without charge to the converting holder of shares
of Series F Preferred Stock for such certificates or for any tax in respect of
the issuance or delivery of such certificates or the securities represented
thereby, and such certificates shall be issued or delivered in the respective
names of, or (subject to compliance with the applicable provisions of federal
and state securities laws) in such names as may be directed by, the holders of
the shares of Series F Preferred Stock converted; provided, however, that the
Corporation shall not be required to pay any tax which may be payable in respect
of any transfer involved in the issuance and delivery of any such certificate in
a name other than that of the holder of the shares of Series F Preferred Stock
converted, and the Corporation shall not be required to issue or deliver such
certificate unless or until the Person or Persons requesting the issuance or
delivery thereof shall have paid to the Corporation the amount of such tax or
shall have established to the reasonable satisfaction of the Corporation that
such tax has been paid.
8. Certain Remedies. Any registered holder of shares of Series F Preferred
Stock shall be entitled to an injunction or injunctions to prevent breaches of
the provisions of this Certificate of Designations and to enforce specifically
the terms and provisions of this Certificate of Designations in any court of the
United States or any
16
state thereof having jurisdiction, this being in addition to any other remedy to
which such holder may be entitled at law or in equity.
9. Business Day. If any payment shall be required by the terms hereof to
be made on a day that is not a Business Day, such payment shall be made on the
immediately succeeding Business Day, such payment shall be made on the
immediately succeeding Business Day.
10. Definitions. As used in this Certificate of Designations, the
following terms shall have the following meanings (with terms defined in the
singular having comparable meanings when used in the plural and vice versa),
unless the context otherwise requires:
"Accreted Value" means, with respect to each share of Series F Preferred
Stock, an amount equal to the Stated Value per share of Series F Preferred
Stock plus an amount equal to any dividends accrued but not yet under Section
3(b).
"Additional Series F Director" shall have the meaning ascribed to it in
Section 6(b) hereof.
"Affiliate" shall mean any Person who is an "affiliate" as defined in
Rule 12b-2 of the General Rules and Regulations under the Exchange Act. In
addition, the following shall be deemed to be Affiliates of GAP Coinvestment,
GAP LP and GapStar: (a) GAP LLC, the members of GAP LLC, the limited partners of
GAP Coinvestment and the limited partners of GAP LP; (b) any Affiliate of GAP
LLC, the members of GAP LLC, the limited partners of GAP Coinvestment and the
limited partners of GAP LP; and (c) any limited liability company or partnership
a majority of whose members or partners, as the case may be, are members or
former members of GAP LLC or consultants or key employees of General Atlantic
Service Corporation, a Delaware corporation and an Affiliate of GAP LLC. In
addition, GAP LP, GapStar and GAP Coinvestment shall be deemed to be Affiliates
of one another.
"Automatic Redemption Date" shall have the meaning ascribed to it in
Section 5(b) hereof.
"Board of Directors" has the meaning set forth in the preamble to this
Certificate of Designations.
"Business Day" means any day except a Saturday, a Sunday, or other day on
which commercial banks in the State of New York are authorized or required by
law or executive order to close.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations, rights in, or other equivalents (however designated
and whether voting or non-voting) of, such Person's capital stock and any and
all rights, warrants or options exchangeable for or convertible into such
capital stock (but excluding any debt security whether or not it is
exchangeable for or convertible into such capital stock).
17
"Commission" means the United States Securities and Exchange
Commission.
"Common Stock" shall have the meaning ascribed to it in Section 2(a)
hereof.
"Common Stock Equivalent" means any security or obligation which is
by its terms convertible or exchangeable into shares of Common Stock or another
Common Stock Equivalent, and any option, warrant or other subscription or
purchase right with respect to Common Stock.
"Conversion Price" shall have the meaning ascribed to it in Section
7(a) hereof.
"Corporation" shall have the meaning ascribed to it in the first
paragraph of this Certificate of Designation.
"Current Market Price" per share shall mean, as of the date of
determination, (a) the average of the daily Market Price under clause (a),(b)or
(c) of the definition thereof of the Common Stock during the immediately
preceding thirty (30) Trading Days ending on such date, and (b) if the Common
Stock is not then listed or admitted to trading on any national securities
exchange or quoted in the over-the-counter market, then the Market Price under
clause (d) of the definition thereof on such date.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder.
"Excluded Transaction" means (a) any issuance of up to an aggregate
of 10,506,313 shares of restricted stock or options to purchase shares of Common
Stock (subject to adjustment in the event of stock splits, combinations or
similar occurrences) to employees, officers or directors of the Corporation
pursuant to the Stock Option Plan or and (b) any issuance of Common Stock (i)
upon the conversion of shares of Series F Preferred Stock, (ii) as a dividend on
shares of Series F Preferred Stock or (iii) upon conversion or exercise of any
Common Stock Equivalents and/or (c) any issuance of Common Stock in connection
with any Participation Payment.
"Extraordinary Actions" shall have the meaning ascribed to it in
Section 6(c) hereof.
"GAP Coinvestment" shall have the meaning ascribed to it in Section
6(b) hereof.
"GAP LLC" means General Atlantic Partners, LLC, a Delaware limited
liability company and the general partner of GAP LP and the managing member of
GapStar, and any successor to such entity.
"GAP LP" shall have the meaning ascribed to it in Section 6(b)
hereof.
18
"GapStar" shall have the meaning ascribed to it in Section 6(b)
hereof.
"Hurdle Rate" shall have the meaning ascribed to it in Section 5(a)
hereof.
"Issue Date" shall have the meaning ascribed to it in Section
7(d)(ii) hereof.
"Junior Stock" shall have the meaning ascribed to it in Section 2(a)
hereof.
"Liquidation" shall mean the voluntary or involuntary liquidation
under applicable bankruptcy or reorganization legislation, or the dissolution or
winding up of the Corporation.
"Mandatory Dividend Payment Date" shall have the meaning ascribed to
it in Section 3(b) hereof.
"Market Price" shall mean, as of the date of determination, (a) if
the Common Stock is listed on a national securities exchange, the closing price
per share of Common Stock on such date published in The Wall Street Journal
(National Edition) or, if no such closing price on such date is published in The
Wall Street Journal (National Edition), the average of the closing bid and asked
prices on such date, as officially reported on the principal national securities
exchange on which the Common Stock is then listed or admitted to trading; or(b)
if the Common Stock is not then listed or admitted to trading on any national
securities exchange but is designated as a national market system security by
the National Association of Securities Dealers, Inc., the last trading price of
the Common Stock on such date; or (c) if there shall have been no trading on
such date) or if the Common Stock is not designated as a national market system
security by the National Association of Securities Dealers, Inc., the average
of the reported closing bid and asked prices of the Common Stock on such date as
shown by the NASDAQ and reported by any member firm of the New York Stock
Exchange selected by the Corporation; or (d) if none of (a),(b)or (c)is
applicable, a market price per share determined in good faith by the Board of
Directors.
"NASDAQ" means the National Market System of the National
Association of Securities Dealers, inc. Automated Quotations System.
"Net Per Share Price" shall mean an amount equal to a quotient
expressed as a fraction (a) the numerator of which shall be the aggregate dollar
amount paid to the stockholders of the Corporation as consideration in a Sale
Transaction and (b) the denominator of which shall be the number of shares of
Common Stock outstanding on a fully diluted basis. In determining the aggregate
dollar amount paid to the stockholders of the Corporation as consideration in a
Sale Transaction, any securities of the surviving Person or securities of the
Corporation other than Common Stock shall be valued as follows:
(i) With respect to securities that do not constitute
"restricted securities," as such term is defined in Rule 144(a)(3) promulgated
under the
19
Securities Act, the value shall be the Current Market Price of such securities
as of three (3) days prior to the date of distribution.
(ii) With respect to securities that constitute "restricted
securities," as such term is defined in Rule 144(a)(3) promulgated under the
Securities Act, and that are of the same class or Series F securities that are
publicly traded, the value shall be adjusted to make an appropriate discount
from the value as set forth above in clause (i) to reflect the appropriate fair
market value thereof, as mutually determined by the Board of Directors and the
holders of a majority of the shares of Series F Preferred Stock, or if there is
no active public market with respect to such class or series of securities, such
securities shall be valued in accordance with clause (i) above, giving
appropriate weight, if any, to such restriction as determined in good faith by
the Board of Directors.
"New Issue Price" shall have the meaning ascribed to it in Section
7(d)(ii) hereof.
"Optional Redeemed Shares" shall have the meaning ascribed to it in
Section 5(a) hereof.
"Optional Redemption Date" shall have the meaning ascribed to it in
Section 5(a) hereof.
"Optional Redemption Payment" shall have the meaning ascribed to it
in Section 5(a) hereof.
"Optional Redemption Price" shall have the meaning ascribed to it
in Section 5(a) hereof.
"Participation Payment" shall have the meaning ascribed to it in
Section 4(a) hereof.
"Per Share Price" as of any date, shall mean the volume-weighted
average trading price of a share of Common Stock, as reported on the NASDAQ or
such other exchange or quotation system that may on such date constitute the
primary exchange or quotation system on which the shares of Common Stock are
then listed or quoted, on each of the twenty(20) consecutive Trading Days ending
on and including the Trading Day prior to such date.
"Person" means any individual, firm, corporation, partnership,
limited liability company, trust, incorporated or unincorporated association,
joint venture, joint stock company, governmental body or other entity of any
kind.
"Redeemed Shares" shall have the meaning ascribed to it in Section
5(b) hereof.
"Redemption Payment" shall have the meaning ascribed to it in
Section 5(b) hereof.
20
"Redemption Per Share Price" as of any date, shall mean the volume-
weighted average trading price of a share of Common Stock, as reported on the
NASDAQ or such other exchange or quotation system that may on such date
constitute the primary exchange or quotation system on which the shares of
Common Stock are then listed or quoted, on each of the ninety (90) consecutive
Trading Days ending on and including the Trading Day prior to such date
"Redemption Price" shall have the meaning ascribed to it in Section
5(b) hereof.
"Relevant Date" shall have the meaning ascribed to it in Section
7(d)(ii) hereof.
"Sale Transaction" shall mean (a) (i) the merger or consolidation of
the Corporation into or with one or more Persons, (ii) the merger or
consolidation of one or more Persons into or with the Corporation or (iii) a
tender offer or other business combination if, in the case of (i), (ii) or
(iii), the stockholders of the Corporation prior to such merger or consolidation
do not retain at least a majority of the voting power of the surviving Person,
(b) the voluntary sale, conveyance, exchange or transfer to another Person of
(i) the voting Capital Stock of the Corporation if, after such sale, conveyance,
exchange or transfer, the stockholders of the Corporation prior to such sale,
conveyance, exchange or transfer do not retain at least a majority of the voting
power of the Corporation or (ii) all or substantially all of the assets of the
corporation, or (c) the sale of assets of the Corporation, other than such a
sale in the ordinary course of business, the gross proceeds of which exceed
$10,000,000; provided, that with respect to (b)(ii) above, for the avoidance of
doubt, the sale, conveyance, exchange or transfer of the Ticketing Service Group
shall be deemed to be such a Sale, conveyance or transfer of substantially all
of the assets of the Corporation.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Series F Directors" shall have the meaning ascribed to it in
Section 6(b) hereof.
"Series F Preferred Stock" shall have the meaning ascribed to it in
Section 1 hereof.
"Stated Value" means $0.60 per share for each of the then
outstanding shares of Series F Preferred Stock, as adjusted for stock splits,
stock dividends, contributions or other recapitalizations of the Series F
Preferred Stock.
"Stock Option Plan" means the Xxxxxxx.xxx, Inc. 1999 Stock Incentive
Plan.
"Subsidiaries" means, as of the relevant date of determination, with
respect to any Person, a corporation or other Person of which 50% or more of the
voting
21
power of the outstanding voting equity securities or 50% or more of the
outstanding economic equity interest is held, directly or indirectly, by such
Person.
"Trading Day" shall mean any day for which quotations are available
in respect of shares of Common Stock on the NASDAQ (or such other exchange or
quotation system that may on such date constitute the primary exchange or
quotation system on which the shares of Common Stock are then listed or quoted).
"Transaction" shall have the meaning ascribed to it in Section 7(g)
hereof.
"Value" shall mean (a) in the case of a sale Transaction in which
the stockholders of the Corporation receive cash as consideration, the aggregate
dollar amount paid to such stockholders in such Sale Transaction or (b) in all
other cases, the fair market value of the Corporation as shall be determined in
good faith by the Board of Directors.
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IN WITNESS WHEREOF, the undersigned has executed and subscribed this
certificate this 12th day of June, 2001.
/s/ W. Xxxxxx Xxxxxx
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W. Xxxxxx Xxxxxx
Chief Executive Officer
