SHAREHOLDER AGREEMENT
This
Shareholder Agreement (“Agreement”) is
entered into as of December 22, 2010, by and between Rovi
Corporation, a Delaware corporation (“Parent”), and the
shareholder named on the signature page hereof (“Shareholder”).
Recitals
A.
Shareholder is a holder of record and the “beneficial owner” (within
the meaning of Rule 13d-3 under the Securities Exchange Act of 1934) of certain
shares of common stock of Sonic Solutions, a California corporation (the “Company”).
B.
Parent, Sparta Acquisition Sub, Inc., a California
corporation (“Acquisition Sub”),
and the Company are entering into an Agreement and Plan of Merger and
Reorganization of even date herewith (the “Merger Agreement”)
which provides (subject to the conditions set forth therein) for Parent to
acquire the Company by (i) causing Acquisition Sub to make an exchange offer as
contemplated by the Merger Agreement (the “Offer”) for all of
the issued and outstanding common stock of the Company and (ii) after the
closing of the Offer, causing Acquisition Sub to merge with and into the Company
(the “Merger”)
and, subject to the terms of the Merger Agreement, immediately following the
Merger, Parent shall cause the surviving corporation in the Merger to be
merged with and into a direct limited liability company Subsidiary of
Parent (the "Second
Merger" and together with the Merger, the "Mergers").
C.
Shareholder is entering into this Agreement in
order to induce Parent to enter into the Merger Agreement.
Agreement
The parties to this Agreement,
intending to be legally bound, agree as follows:
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SECTION
1.
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Certain
Definitions
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For purposes of this
Agreement:
(a) “Company Common
Stock” shall mean
the common stock, no par value per share, of the Company.
(b)
Shareholder shall be deemed to “Own” or to have
acquired “Ownership” of a
security if Shareholder: (i) is the record owner of such security; or (ii) is
the “beneficial owner” (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934) of such security.
(c) “Subject
Securities” shall
mean: (i) all securities of the Company (including all shares of Company Common
Stock and all options, warrants and other rights to acquire shares of Company
Common Stock) Owned by Shareholder as of the date of this Agreement; and (ii)
all additional securities of the Company (including all additional shares of
Company Common Stock and all additional options, warrants and other rights to
acquire shares of Company Common Stock) of which Shareholder acquires Ownership
during the period from the date of this Agreement through the Termination
Date.
(d) “Subject Shares” shall mean: (i) all shares
of Company Common Stock Owned by Shareholder as of the date of this Agreement;
(ii) all additional shares of Company Common Stock of which Shareholder acquires
Ownership during the period from the date of this Agreement through the
Termination Date; and (iii) all securities into which any of the shares of
Company Common Stock described in clause “(i)” or clause “(ii)” above are
exchanged or converted.
(e) “Termination Date” shall
mean the earlier of (i) the date upon which the Merger Agreement is terminated
in accordance with its terms, or (ii) the Effective Time of the
Merger.
(f) A
Person shall be deemed to have a effected a “Transfer” of a
security if such Person directly or indirectly: (i) sells, pledges, encumbers,
grants an option with respect to, transfers or disposes of such security or any
interest in such security to any Person other than Parent; (ii) enters into an
agreement or commitment contemplating the possible sale of, pledge of,
encumbrance of, grant of an option with respect to, transfer of or disposition
of such security or any interest therein to any Person other than Parent; or
(iii) reduces such Person’s beneficial ownership of, interest in or risk
relating to such security; provided that any transaction pursuant to which the
Company purchases or cashes out any Company Options and/or Company Restricted
Stock Units (as such terms are defined in the Merger Agreement) upon
acceleration thereof in accordance with the terms thereof shall not be deemed a
“Transfer” pursuant to this Agreement.
(g) Capitalized
terms used but not otherwise defined in this Agreement have the meanings
assigned to such terms in the Merger Agreement.
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SECTION
2.
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Transfer of Subject Securities and Voting
Rights
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2.1 Restriction on Transfer of Subject
Securities. Subject to Section 2.3,
during the period from the date of this Agreement through the Termination Date,
Shareholder shall not, directly or indirectly, cause or permit any Transfer of
any of the Subject Securities to be effected, other than pursuant to the terms,
in effect as of the date of this Agreement, of a written plan that meets all of
the requirements of Rule 10b5-1(c) under the Securities Exchange Act of
1934.
2.2 Restriction on Transfer of Voting or
Disposition Rights. During the period from the date of this
Agreement through the Termination Date, Shareholder shall ensure
that: (a) none of the Subject Securities is deposited into a voting
trust; (b) no proxy is granted, and no voting agreement or similar agreement is
entered into, with respect to any of the Subject Securities; and (c) no Person
other than Shareholder (or any other Person that is the record owner of any of
the Subject Securities as of the date of this Agreement, but only with respect
to such Subject Securities) is granted dispositive power with respect to any of
the Subject Securities.
2.3 Permitted Transfers. Section 2.1 shall not
prohibit a Transfer of Subject Securities by Shareholder (a) if Shareholder is
an individual (i) to any member of Shareholder’s immediate family, or to a trust
for the benefit of Shareholder or any member of Shareholder’s immediate family,
or (ii) upon the death of Shareholder, or (b) if Shareholder is a partnership or
limited liability company, to one or more partners or members of Shareholder or
to an affiliated corporation under common control with Shareholder; provided, however, that a
Transfer referred to in this sentence shall be permitted only if, as a
precondition to such Transfer, the transferee agrees in a writing, reasonably
satisfactory in form and substance to Parent, to be bound by all of the terms of
this Agreement.
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SECTION
3.
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Agreement to Tender
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3.1 Tender of Subject Shares. Shareholder agrees to
promptly (and, in any event, not later than five business days after
commencement of the Offer) validly tender or cause to be validly tendered into
the Offer, pursuant to and in accordance with the terms of the Offer and Rule
14d-2 under the Securities Exchange Act of 1934, all of the Subject Shares Owned
by Shareholder as of the date of this Agreement (free and clear of any
encumbrances or restrictions), and if Shareholder acquires Ownership of any
additional Subject Shares after the date of this Agreement, to promptly (and, in
any event, not later than two business days after Shareholder acquires Ownership
of such additional Subject Shares) validly tender or cause to be validly
tendered into the Offer, pursuant to and in accordance with the terms of the
Offer, all of such additional Subject Shares (free and clear of any encumbrances
or restrictions).
3.2 No Withdrawal. Shareholder agrees not
to withdraw or cause to be withdrawn any of the Subject Shares from the Offer
unless and until the Offer expires without Acquisition Sub having accepted for
exchange shares of Company Common Stock validly tendered in the
Offer.
3.3 Conditional Obligation. Shareholder acknowledges
and agrees that Acquisition Sub’s obligation to accept for exchange shares of
Company Common Stock in the Offer, including any Subject Shares tendered by
Shareholder, is subject to the terms and conditions of the Merger Agreement and
the Offer.
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SECTION
4.
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Voting of Shares
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Shareholder
hereby agrees that, prior to the Termination Date, at any meeting of the
shareholders of the Company, however called, and in any written action by
consent of shareholders of the Company, unless otherwise directed in writing by
Parent, Shareholder shall cause any Subject Securities not acquired pursuant to
the Offer to be voted:
(a) in
favor of each of the Mergers, the execution and delivery by the Company of the
Merger Agreement and the adoption of the Merger Agreement and the terms thereof,
in favor of each of the other actions contemplated by the Merger Agreement and
in favor of any action in furtherance of any of the foregoing;
(b) against
any action or agreement that would result in a breach of any representation,
warranty, covenant or obligation of the Company in the Merger Agreement;
and
(c) against
any action that is intended, or that could reasonably be expected, to impede,
interfere with, delay, postpone, discourage or adversely affect the Offer or
either of the Mergers or any of the other Contemplated Transactions or this
Agreement.
Prior to
the Termination Date, Shareholder shall not enter into any agreement or
understanding with any Person to vote or give instructions in any manner
inconsistent with clause “(a)”, clause “(b)” or clause “(c)” of the preceding
sentence.
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SECTION
5.
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Waiver of Appraisal Rights
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Shareholder hereby irrevocably and
unconditionally waives, and agrees to cause to be waived and to prevent the
exercise of, any rights of appraisal, any dissenters’ rights and any similar
rights relating to the Merger or any related transaction that Shareholder or any
other Person may have by virtue of, or with respect to, any shares of Company
Common Stock Owned by Shareholder.
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SECTION
6.
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Representations and Warranties of
Shareholder
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Shareholder hereby represents and
warrants to Parent as follows:
6.1 Authorization, etc. Shareholder has the
absolute and unrestricted right, power, authority and capacity to execute and
deliver this Agreement and to perform Shareholder’s obligations
hereunder. This Agreement has been duly executed and delivered by
Shareholder and constitutes a legal, valid and binding obligation of
Shareholder, enforceable against Shareholder in accordance with its terms,
subject to (i) laws of general application relating to bankruptcy,
insolvency and the relief of debtors and (ii) rules of law governing
specific performance, injunctive relief and other equitable
remedies.
6.2 No
Conflicts or Consents.
(a) The
execution and delivery of this Agreement by Shareholder do not, and the
performance of this Agreement by Shareholder will not: (i) conflict with or
violate any Legal Requirements applicable to Shareholder; (ii) result in or
constitute a breach of, or give to any Person any right of termination,
amendment, acceleration or cancellation of, or result in the creation of any
encumbrance or restriction on any of the Subject Securities pursuant to any
Contract to which Shareholder is a party; or (iii) require any consent or
approval of any Person.
6.3 Title to
Securities. As of the date of this Agreement: (a)
Shareholder holds of record (free and clear of any encumbrances or restrictions)
the number of outstanding shares of Company Common Stock set forth under the
heading “Shares Held of Record” on the signature page hereof; (b) Shareholder
holds (free and clear of any encumbrances or restrictions) the options, warrants
and other rights to acquire shares of Company Common Stock set forth under the
heading “Options and Other Rights” on the signature page hereof; (c) Shareholder
Owns the additional securities of the Company set forth under the heading
“Additional Securities Beneficially Owned” on the signature page hereof; and (d)
Shareholder does not directly or indirectly Own any shares of capital stock or
other securities of the Company, or any option, warrant or other right to
acquire (by purchase, conversion or otherwise) any shares of capital stock or
other securities of the Company, other than the shares and options, warrants and
other rights set forth on the signature page hereof.
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SECTION
7.
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Additional Covenants of Shareholder
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7.1 Shareholder
Information. Shareholder hereby agrees to permit Parent and
Acquisition Sub to publish and disclose in the Schedule TO, the Form S-4
Registration Statement or other publicly-filed documents relating to the Offer
and, if adoption of the Merger Agreement by the Shareholders of the Company is
required under the terms of the CGCL or other applicable law, the Proxy
Statement, Shareholder’s identity and ownership of shares of Company Common
Stock and the nature of Shareholder’s commitments, arrangements and
understandings under this Agreement.
7.2 Further
Assurances. From time to time and without additional
consideration, Shareholder shall execute and deliver, or cause to be executed
and delivered, such additional transfers, assignments, endorsements, proxies,
consents and other instruments, and shall take such further actions, as Parent
may reasonably request for the purpose of carrying out and furthering the intent
of this Agreement.
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SECTION
8.
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Miscellaneous
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8.1 Notices. Any notice
or other communication required or permitted to be delivered to either party
under this Agreement shall be in writing and shall be deemed properly delivered,
given and received when received at the address or facsimile telephone number
set forth beneath the name of such party below (or at such other address or
facsimile telephone number as such party shall have specified in a written
notice given to the other party):
if to Shareholder:
at the
address set forth on the signature page hereof; and
if
to Parent:
Rovi
Corporation
0000 Xx
Xx Xxxx Xxxx.
Xxxxx
Xxxxx, XX 00000
Attention:
General Counsel
Fax:
(000) 000-0000.
8.2 Severability. Any
term or provision of this Agreement that is invalid or unenforceable in any
situation in any jurisdiction shall not affect the validity or enforceability of
the remaining terms and provisions hereof or the validity or enforceability of
the offending term or provision in any other situation or in any other
jurisdiction. If the final judgment of a court of competent
jurisdiction declares that any term or provision hereof is invalid or
unenforceable, the parties hereto agree that the court making such determination
shall have the power to limit the term or provision, to delete specific words or
phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified. In the event such
court does not exercise the power granted to it in the prior sentence, the
parties hereto shall replace such invalid or unenforceable term or provision
with a valid and enforceable term or provision that will achieve, to the extent
possible, the economic, business and other purposes of such invalid or
unenforceable term.
8.3 Entire
Agreement. This Agreement and any other documents delivered by
the parties in connection herewith constitute the entire agreement between the
parties with respect to the subject matter hereof and thereof and supersede all
prior agreements and understandings between the parties with respect
thereto. No addition to or modification of any provision of this
Agreement shall be binding upon either party unless made in writing and signed
by both parties.
8.4 Assignment; Binding
Effect. Except as provided herein, neither this Agreement nor
any of the interests or obligations hereunder may be assigned or delegated by
Shareholder, and any attempted or purported assignment or delegation of any of
such interests or obligations shall be void. Without limiting any of
the restrictions set forth in Section 2 or elsewhere in this Agreement, this
Agreement shall be binding upon any Person to whom any Subject Securities are
transferred.
8.5 Specific
Performance. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with its specific terms or were otherwise
breached. Shareholder agrees that, in the event of any breach or
threatened breach by Shareholder of any covenant or obligation contained in this
Agreement, Parent shall be entitled (in addition to any other remedy that may be
available to it, including monetary damages) to seek and obtain (a) a decree or
order of specific performance to enforce the observance and performance of such
covenant or obligation, and (b) an injunction restraining such breach or
threatened breach. Shareholder further agrees that neither Parent nor
any other Person shall be required to obtain, furnish or post any bond or
similar instrument in connection with or as a condition to obtaining any remedy
referred to in this Section 8.5, and Shareholder irrevocably waives any right he
or it may have to require the obtaining, furnishing or posting of any such bond
or similar instrument.
8.6 Non-Exclusivity. The
rights and remedies of Parent under this Agreement are not exclusive of or
limited by any other rights or remedies which it may have, whether at law, in
equity, by contract or otherwise, all of which shall be cumulative (and not
alternative).
8.7 Governing Law; Jurisdiction; Waiver
of Jury Trial.
(a) This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of California, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof. In any
action between any of the parties arising out of or relating to this Agreement
each of the parties irrevocably and unconditionally consents and submits to the
exclusive jurisdiction and venue of the courts of the State of California or if
no such state court has proper jurisdiction, then the federal courts located in
the State of California.
(b) SHAREHOLDER
IRREVOCABLY WAIVES THE RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LEGAL
PROCEEDING RELATING TO THIS AGREEMENT OR THE ENFORCEMENT OF ANY PROVISION OF
THIS AGREEMENT.
8.8 Counterparts. This
Agreement may be executed in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute one and the same instrument.
8.9 Captions. The
captions contained in this Agreement are for convenience of reference only,
shall not be deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this
Agreement.
8.10 Waiver. Parent
shall not be deemed to have waived any claim available to Parent arising out of
this Agreement, or any power, right, privilege or remedy of Parent under this
Agreement, unless the waiver of such claim, power, right, privilege or remedy is
expressly set forth in a written instrument duly executed and delivered on
behalf of Parent; and any such waiver shall not be applicable or have any effect
except in the specific instance in which it is given.
8.11 Not Binding in Other
Capacities. Notwithstanding anything in this Agreement to the
contrary, the parties acknowledge and agree that Shareholder is entering into
this Agreement solely in his capacity as a Shareholder of the Company and
nothing in this Agreement shall be construed to prohibit or restrict
Shareholder from taking any action in his capacity as an officer or member of
the Board of Directors of the Company, subject to the limitations (and
consequences of such actions) set forth in the Merger Agreement.
[Remainder
of page intentionally left blank.]
In Witness
Whereof, Parent and Shareholder have caused this Agreement to be executed
as of the date first written above.
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Rovi
Corporation
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By
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Xxxx
Xxxxxxx
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Name
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President
and Chief Executive Officer
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Title
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Shareholder
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Signature
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Printed
Name
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Address:
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Facsimile:
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Shares Held of Record
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Options and Other Rights
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Additional Securities
Beneficially Owned
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Signature
Page to Stockholder Agreement
