EXHIBIT 2
INVESTOR RIGHTS AGREEMENT
INVESTOR RIGHTS AGREEMENT
This Investor Rights Agreement (the "Agreement") is made and
entered into as of March 22, 1997 by and among Avid Technology,
Inc., a Delaware corporation (the "Company"), and Intel
Corporation, a Delaware corporation ("Stockholder").
RECITALS
A. The Company and Stockholder have entered into a Common Stock
Purchase Agreement dated as of March 22, 1997 (the "Purchase
Agreement") pursuant to which Stockholder has agreed to purchase
1,552,632 shares of the Company's Common Stock, par value $0.01
per share ("Common Stock").
B. The execution and delivery of this Agreement by the parties
hereto is a condition precedent to the obligations of the parties
under the Purchase Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, the parties hereto agree as follows:
1. Definitions
For the purposes of this Agreement, the following terms have
the meanings indicted below:
1933 Act. The Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder, as in effect
from time to time.
1934 Act. The Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as
in effect from time to time.
Business Day. Each weekday that is not a day on which
banking institutions in New York are authorized or obligated by
law or executive order to close.
Commission. The United States Securities and Exchange
Commission.
Holder. Any person owning Registrable Securities who
is a party to this Agreement, and any transferee thereof in
accordance with Section 7 or 11 of this Agreement.
Prospectus. The prospectus included in any
Registration Statement, as amended or supplemented by any
prospectus supplement (including, without limitation, any
prospectus supplement with respect to the terms of the offering
of any portion of the Registrable Securities covered by such
Registration Statement), and all other amendments and supplements
to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated
by reference in such Prospectus.
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Register, registration and registered. A registration
effected by preparing and filing a registration statement or
similar document with the Commission in compliance with the 1933
Act, and the declaration or ordering of effectiveness of such
registration statement or document.
Registrable Securities. The shares of Common Stock
issued to Stockholder pursuant to the Purchase Agreement and any
securities that may be issued by the Company or any successor to
the Company from time to time with respect to, in exchange for,
or in replacement of such shares of Common Stock, including,
without limitation, securities issued as a stock dividend on or
pursuant to a stock split of such shares of Common Stock;
provided, however, that those shares as to which the following
apply shall cease to be Registrable Securities when: (a) a
Registration Statement with respect to the sale of such
Registrable Securities shall have become effective under the 1933
Act and such Registrable Securities shall have been disposed of
under such Registration Statement; (b) such Registrable
Securities shall have become transferable, or have become
eligible and remain eligible for transfer (whether or not so
transferred), in accordance with Rule 144(k), or any successor
rule or provision, under the 1933 Act; (c) such Registrable
Securities shall have been transferred in a transaction in which
the Holder's rights and obligations under this Agreement were not
assigned in accordance with this Agreement; (d) such Registrable
Securities shall have ceased to be outstanding; or (e) such
Registrable Securities shall have been sold pursuant to Rule 144.
Registration Expenses. All expenses incident to the
Company's performance of or compliance with Sections 2 and 4
hereof, including, without limitation, all registration and
filing fees (including filing fees with respect to the Commission
and to the National Association of Securities Dealers, Inc. and
listing fees of the Nasdaq National Market), all fees and
expenses of complying with state securities or "blue sky" laws
(including fees and disbursements of underwriters' counsel in
connection with any "blue sky" memorandum or survey, but
excluding any fees and expenses for foreign qualification in such
jurisdictions), all printing expenses, all registrars' and
transfer agents' fees and all fees and disbursements of the
Company's counsel and independent public accountants; provided,
however, that Registration Expenses shall not include the fees
and expenses of more than one counsel to the holders of
Registrable Securities, or underwriters' discounts and
commissions, or brokerage fees, associated with the sale of the
Registrable Securities.
Registration Statement. A registration statement
prepared and filed with the Commission in compliance with the
1933 Act.
Seller. Any person, including any Holder, selling any
Registrable Securities in an offering of any Registrable
Securities of the Company pursuant to this Agreement.
Selling Expenses. All applicable discounts and
commissions, brokerage fees, transfer taxes and any fees and
disbursements of more than one counsel or any accountants or
other advisors for the Sellers of the Registrable Securities
being registered.
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2. "Piggy-Back" Registration Rights
If at any time the Company shall determine to register
pursuant to an underwritten public offering under the 1933 Act
any of its Common Stock for its own account, or the account of
other stockholders of the Company desiring to sell "restricted
securities" of the Company (as defined in Rule 144 of the 0000
Xxx) pursuant to an underwritten public offering, it shall send
to the Holder written notice of such determination and, if within
15 calendar days after receipt of such notice, Holder shall so
request in writing, the Company shall include in such
registration statement all or any part of the Registrable
Securities the Holder requests to be registered. This right
shall not apply to a registration of shares of Common Stock on
Form S-8 or Form S-4 (or their then equivalents) relating to
shares of Common Stock to be issued by the Company in connection
with any acquisition of any entity or business, or shares of
Common Stock issuable in connection with any stock option, stock
purchase plan or other employee benefit plan.
If, in connection with any offering involving an
underwriting of Common Stock to be issued for the account of the
Company or selling securityholders, the managing underwriter
shall impose a limitation on the number of shares of such Common
Stock which may be included in any such registration statement
because, in its judgment, such limitation is necessary to effect
an orderly public distribution of the Common Stock and to
maintain a stable market for the securities of the Company, then
the Company shall be obligated to include in such registration
statement only such limited portion of the stock with respect to
which the Holder has requested inclusion hereunder, on a pro rata
basis based on the number of shares of Common Stock owned by the
Holder and all other selling securityholders, other than
securityholders whose shares are to be included in such
registration statement pursuant to the exercise of demand
registration rights under any agreement with the Company (a
"Demand Securityholder"); provided, however, there shall be no
reduction in the number of shares included therein by the
Company, or if such registration statement is filed at the
request of a Demand Securityholder, by such Demand
Securityholder.
3. Shelf Registration
3.1 Undertaking to Register
As soon as practicable but in any event within 150 days
following the Closing (as that term is defined in the Purchase
Agreement), upon written request of Stockholder, the Company will
use its commercially reasonable best efforts to prepare, file and
have declared effective a registration statement under the
Securities Act to register all of the Registrable Securities for
resale in the public market in brokerage transactions or
transactions with market makers, in block trades, and in
privately negotiated transactions.
3.2 Selling Procedures; Suspension
(a) Except in the event that paragraph (b) below
applies, the Company shall (i) if deemed necessary by the
Company, prepare and file from time to time with the Commission a
post-effective amendment to the Registration Statement or a
supplement to the related Prospectus or a supplement or amendment
to any document incorporated therein by
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reference or file any other required document so that such
Registration Statement will not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and so that, as thereafter delivered to purchasers of
the Registrable Securities being sold thereunder, such Prospectus
will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; (ii)
provide the Holders of the Registrable Securities copies of any
documents filed pursuant to Section 3.2(a)(i); and (iii) inform
each Holder that the Company has complied with its obligations in
Section 3.2(a)(i) (or that, if the Company has filed a post-
effective amendment to the Registration Statement which has not
yet been declared effective, the Company will notify each such
Holder to that effect, will use its best efforts to secure the
effectiveness of such post-effective amendment and will
immediately notify each such Holder pursuant to Section 3.2(a)(i)
hereof when the amendment has become effective).
(b) In the event (i) of any request by the Commission
or any other federal or state governmental authority during the
period of effectiveness of the Registration Statement for
amendments or supplements to a Registration Statement or related
Prospectus or for additional information; (ii) of the issuance by
the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for
that purpose; (iii) of the receipt by the Company of any
notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; (iv) of any event
or circumstance which necessitates the making of any changes in
the Registration Statement or Prospectus, or any document
incorporated or deemed to be incorporated therein by reference,
so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or any omission
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and that
in the case of the Prospectus, it will not contain any untrue
statement of a material fact or any omission to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; or (v) that, in the reasonable,
good faith judgment of the Company's Board of Directors, upon the
advice of counsel, (A) the offering of securities pursuant
thereto would materially and adversely affect (i) a pending or
scheduled public offering or private placement of the Company's
securities, (ii) a pending or proposed acquisition, merger,
consolidation, reorganization, restructuring or similar
transaction of or by the Company or other material corporate
activity or transaction, (iii) bona fide negotiations,
discussions or proposals with respect to any of the foregoing, or
(iv) the position or strategy of the Company in connection with
any pending or threatened litigation, claim, assessment or
government investigation and (B) in the event sales of
Registrable Securities were made under the Registration Statement
and disclosure of all material information with respect to the
applicable circumstance(s) described in subparagraph (A) had not
been made, such circumstances could reasonably be expected to
cause a violation of the 1933 Act or the 1934 Act (each a
"Suspension Event"); then, subject to paragraph (d) below, the
Company shall deliver a certificate in writing to the Holders
(the "Suspension Notice") to the effect of the foregoing and,
upon receipt of such Suspension Notice, each such Holder will
refrain from selling any Registrable Securities
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pursuant to the Registration Statement (a "Suspension") until
such Holder's receipt of copies of the supplemented or amended
Prospectus provided for in Section 3.2(a)(i) hereof, or until it
is advised in writing by the Company that the Prospectus may be
used, and has received copies of any additional or supplemental
filings that are incorporated or deemed incorporated by reference
in such Prospectus.
(c) In the event of any Suspension, or any delay in
effecting the Registration under Section 3.2 above, the Company
will use its best efforts to ensure that the use of the
Prospectus so suspended or delayed may be commenced or resumed,
as the case may be, and that the Suspension will terminate and
the Holder's ability to sell pursuant to the Prospectus so
suspended will commence or resume, as the case may be, as soon as
practicable and, in the case of a pending development, filing or
event referred to in Section 3.2(b)(iv) or (v) hereof, as soon,
in the judgment of the Company's Board of Directors (in
accordance with the provisions of Section 3.2), as disclosure of
such pending development, filing or event would not have a
material adverse effect on the Company's ability to consummate
the transaction, if any, contemplated by such development, filing
or event. Notwithstanding any other provision of this Agreement,
the Company shall have the right to cause a maximum of two (2)
Suspensions pursuant to Section 3.2(b)(iv) and (v), neither of
which may be within 45 days of the other, as provided above
(including for this purpose a delay in effecting the Registration
pursuant to Section 3.2 above) during any 12-month period after
the initial effective date of the Registration Statement, and the
total number of days for which all Suspensions (including for
this purpose a delay in effecting the Registration Statement
pursuant to Section 3.2 above) during any 12-month period shall
not exceed 90 days in the aggregate; provided that no such
individual Suspension may be in effect for more than 60 days.
(d) The Company will use its commercially reasonable
best efforts to maintain the effectiveness of any registration
statement pursuant to which any of the Registrable Securities are
being offered for (i) up to 120 days, (or such shorter period of
time as the underwriters need to complete the distribution of the
registered offering in any Company-primary or secondary
offering), in the case of a registration pursuant to Section 2,
or (ii) in the case of a "shelf" Registration Statement pursuant
to Section 3.1 until the date on which each Holder may sell all
Registrable Securities then held by such Holder without
restriction by the volume limitations of Rule 144(e). The
Company from time to time will amend or supplement such
Registration Statement and the Prospectus contained therein to
the extent necessary to comply with the 1933 Act and any
applicable state securities statue or regulation.
3.3 Underwriting Agreement
If in connection with any proposed distribution by the
Holder under the "piggy back" registration referred to in Section
2, the Company in its discretion shall determine that it is in
the best interests of the Company to effect distribution by means
of an underwriting, the Company shall promptly notify the Holder
of such determination. In such event, in addition to the
limitations set forth in Section 2, the right of Holder to
participate in such distribution shall be conditioned upon such
Holder's participation in the underwriting arrangements required
by this Section 3.3, including without limitation, the
requirement that the Holder enter into an
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underwriting agreement and a lock-up agreement (for a period
determined by the managing underwriter not to exceed the period
agreed to by all directors and officers of the Company), each in
customary form with the managing underwriter selected for the
underwriting by the Company.
4. Expenses
The Company will pay all Registration Expenses in connection
with the registration of Registrable Securities effected by the
Company pursuant to Section 4; provided that Holder shall pay the
first $50,000 of Registration Expenses applicable to
registrations of Holder's shares of Common Stock under this
Agreement. Holders of Registrable Securities registered pursuant
to this Agreement shall pay all Selling Expenses with each such
Holder bearing a pro rata portion of the Selling Expenses based
upon the number of Registrable Securities registered by each such
Holder.
5. Expiration of Registration Rights
The obligations of the Company under Section 2 of this
Agreement to register the Registrable Securities shall expire and
terminate at the earlier of (a) three years following the Closing
or (b) such time as the Holder shall be entitled or eligible to
sell all such securities without restriction and without a need
for the filing of a registration statement under the Securities
Act, including without limitation, for any resales of restricted
securities made pursuant to Rule 144(k) as promulgated by the
Securities and Exchange Commission. The determination as to
whether the Holder is entitled or eligible to sell all
Registrable Securities without the need for registration under
the Securities Act shall be based on a written opinion of counsel
that registration of the Registrable Securities is not required
under the Securities Act, sufficient to permit the transfer agent
to transfer such securities upon a sale by the Holder. The
obligations of the Company under Section 3 of this Agreement
shall expire at the time specified in Section 3.2(d)(ii).
6. Registration Procedures
In connection with the registration of Registrable
Securities under this Agreement, and subject to the other
provisions of this Agreement, the Company shall:
(a) use its commercially reasonable best efforts to
cause the Registration Statement filed in accordance with Section
2 or Section 3 to become effective as soon as practicable after
the date of filing thereof;
(b) prepare and file with the Commission such
amendments and supplements to such Registration Statement and the
Prospectus used in connection therewith as may be necessary to
keep such Registration Statement continuously effective for the
shorter of (i) the duration of its registration obligations, or
(ii) until there are no Registrable Securities outstanding, and
to comply with the provisions of the 1933 Act with respect to the
disposition of the Registrable Securities;
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(c) furnish to each Seller of such Registrable
Securities such number of copies of the Prospectus included in
such Registration Statement as such Seller may reasonably request
in order to facilitate the sale or disposition of such
Registrable Securities;
(d) use its commercially reasonable best efforts to
register or qualify all securities covered by such Registration
Statement under such other securities or "blue sky" laws of such
jurisdictions as each Seller shall reasonably request, and do any
and all other acts and things that may be necessary to enable
such Seller to consummate the disposition in such jurisdictions
of its Registrable Securities covered by such Registration
Statement, except that the Company shall not for any such purpose
be required to qualify generally to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified,
or to subject itself to taxation in respect of doing business in
any such jurisdiction, or to consent to general service of
process in any such jurisdiction;
(e) notify each Seller of Registrable Securities
covered by such Registration Statement, at any time when a
Prospectus relating thereto is required to be delivered under the
1933 Act, of the happening of any event as a result of which the
Prospectus included in such Registration Statement, as then in
effect, includes an untrue statement of a material fact or omits
to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in light
of the circumstances then existing or if it is necessary to amend
or supplement such Prospectus to comply with the law, and at the
request of any such Seller, prepare and furnish to such Seller a
reasonable number of copies of a supplement to or an amendment of
such Prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities or
securities, such Prospectus, as amended or supplemented, will
comply with the law;
(f) use its best efforts to qualify such securities
for inclusion in the Nasdaq National Market, and provide a
transfer agent and registrar for such Registrable Securities not
later than the effective date of such Registration Statement; and
(g) issue to any person to which any Holder of
Registrable Securities may sell such Registrable Securities in
connection with such registration certificates evidencing such
Registrable Securities without any legend restricting the
transferability of the Registrable Securities (unless otherwise
required by law).
7. 1934 Act Registration
The Company shall timely file with the Commission such
information as the Commission may prescribe under Section 13 or
15(d) of the 1934 Act and shall use its best efforts to take all
action and make all filings of information referenced in Rule
144(c) as may be required as a condition to the availability of
Rule 144 under the 1933 Act (or any successor exemptive rule
hereinafter in effect) with respect to such Common Stock. The
Company shall furnish to any holder of Registrable Securities
forthwith upon request (i) a written statement by the Company as
to its compliance with the reporting requirements of Rule 144(c),
(ii) a copy of the most recent annual or quarterly report of the
Company as filed with the Commission, and (iii) such other
publicly-filed reports and documents as a holder may reasonably
request in availing itself of any
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rule or regulation of the Commission allowing a holder to sell
any such Registrable Securities without registration.
8. Stockholder Information
It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Agreement that all
Holders of Registrable Securities shall furnish to the Company
such information regarding themselves, the Registrable Securities
held by them and the intended method of disposition of such
Registrable Securities as shall be reasonably required to effect
the registration of their Registrable Securities and to execute
such documents in connection with such registration as the
Company may reasonably request.
9. Indemnification and Contribution
In the event any Registrable Securities are included in a
Registration Statement under Sections 2 and 3:
(a) The Company will indemnify and hold harmless each
Seller, the officers, directors, partners, agents and employees
of each Seller, any underwriter (as defined in the 0000 Xxx) for
such Seller and each person, if any, who controls such Seller or
underwriter within the meaning of the 1933 Act or the 1934 Act,
against any losses, claims, damages or liabilities (joint or
several) to which they may become subject under the 1933 Act, the
1934 Act or other federal or state law, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any of the following statements,
omissions or violations (collectively, a "Violation"): (i) any
untrue statement or alleged untrue statement of a material fact
contained in such Registration Statement, including any
preliminary Prospectus or final Prospectus contained therein or
any amendments or supplements thereto; (ii) the omission or
alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading; or (iii) any violation or alleged violation by the
Company of the 1933 Act, the 1934 Act, any state securities law
or any rule or regulation promulgated under the 1933 Act, the
1934 Act or any state securities law; and the Company will
reimburse each such Seller, officer, director, partner, agent,
employee, underwriter or controlling person for any reasonable
legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity
agreement contained in this Section 9(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably
withheld or delayed), nor shall the Company be liable in any such
case for any such loss, claim, damage, liability or action to the
extent that it arises out of or is based upon a Violation (i)
which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such
registration by any such Seller, underwriter or controlling
person or (ii) which is based upon any information in a
Prospectus that has been amended or supplemented if such Seller
had been notified of such amendment or supplement and the use of
such amendment or supplement by the Seller would have avoided the
Violation.
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(b) Each Seller will indemnify and hold harmless the
Company, each of its officers, directors, partners, agents or
employees, each person, if any, who controls the Company within
the meaning of the 1933 Act, any underwriter and any other Seller
or any of its directors, officers, partners, agents or employees
or any person who controls such Seller, against any losses,
claims, damages or liabilities joint or several) to which the
Company or any such director, officer, partner, agent, employee,
controlling person or underwriter, or other such Seller or
director, officer, partner, agent, employee or controlling person
may become subject, under the 1933 Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Seller
expressly for use in connection with such registration; and each
such Seller will reimburse any reasonable legal or other expenses
reasonably incurred by the Company or any such director, officer,
partner, agent, employee, controlling person or underwriter,
other Seller, officer, director, partner, agent, employee or
controlling person in connection with investigating or defending
any such loss, claim, damage, liability or action.
Notwithstanding anything contained in this Agreement to the
contrary, the indemnity agreement contained in this Section 9(b)
shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected
without the consent of the Seller, which consent shall not be
unreasonably withheld or delayed; provided further, that the
aggregate liability of each Seller in connection with any sale of
Registrable Securities pursuant to a Registration Statement in
which a Violation occurred shall be limited to the net proceeds
from such sale.
(c) Promptly after receipt by an indemnified party
under this Section 6 of notice of the commencement of any action
(including any governmental action), such indemnified party will,
if a claim in respect thereof is to be made against any
indemnifying party under this Section 9, deliver to the
indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate
in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume
the defense thereof with counsel selected by the indemnifying
party and reasonably acceptable to the indemnified party;
provided, however, that an indemnified party shall have the right
to retain its own counsel, with the reasonable fees and expenses
to be paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying
party would be inappropriate due to actual or potential differing
or conflicting interests between such indemnified party and any
other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action,
to the extent prejudicial to its ability to defend such action,
shall relieve such indemnifying party of liability to the
indemnified party under this Section 9 to the extent of such
prejudice, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this
Section 9.
(d) If recovery is not available under the foregoing
indemnification provisions of this Section 9, for any reason
other than as specified therein, the parties entitled to
indemnification by the terms thereof shall be entitled to
contribution to liabilities and expenses in
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such proportion as is appropriate to reflect the relative fault
of the indemnifying parties and the indemnified parties, except
to the extent that contribution is not permitted under Section
11(f) of the 1933 Act. The relative fault of such indemnifying
party and indemnified party shall be determined by reference to,
among other things, the parties' relative knowledge and access to
information concerning the matter with respect to which the claim
was asserted, the opportunity to correct and prevent any
statement or omission and any other equitable considerations
appropriate under the circumstances, including, without
limitation, whether any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the
Company, on the one hand, or by the Holder of Registrable
Securities, on the other hand. The Company and Stockholders of
the Registrable Securities covered by such Registration Statement
agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita
allocation. No seller of Registrable Securities covered by such
Registration Statement or person controlling such Seller shall be
obligated to make any contribution hereunder which in the
aggregate exceeds the net proceeds of the securities sold by such
seller, less the aggregate amount of any damages which such
seller and its controlling persons have otherwise been required
to pay in respect of the same claim or any substantially similar
claim. The obligations of such Stockholders to contribute are
several in proportion to their respective ownership of the
Registrable Securities covered by such Registration Statement and
not joint. Notwithstanding the foregoing, in no event shall any
contribution by a Holder under this Section 9(d) exceed the net
proceeds from the offering received by such Holder.
10. Transferability
Each Holder agrees that he will not make any disposition of
all or any portion of the Registrable Securities (a) except in a
registered public offering pursuant to the rights granted in this
Agreement; or (b) until (i) such Holder shall have furnished the
Company with a statement of the circumstances surrounding the
proposed disposition and (ii) if reasonably requested by the
Company, such Holder shall have furnished the Company with an
opinion of counsel, reasonably satisfactory to counsel for the
Company, that such disposition will not require registration of
such Registrable Securities or such transaction under the 1933
Act or applicable state securities laws.
11. Covenants
11.1 Board Observership
During the "Development Period" (as defined in that certain
Software and Hardware Development, License and Distribution
Agreement dated as of March __, 1997 between the Company and
Stockholder (the "Development Agreement")), Stockholder shall be
entitled to appoint a non-voting observer to the Company's Board
of Directors who is reasonably acceptable to the Company; and
such observer shall be entitled to attend all meetings of the
Company's Board of Directors and committees thereof (other than
the audit, nominations and governance and compensation committees
as conducted under their current charters) and shall receive
notice of all meetings and all materials furnished to members of
the Company's Board of
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Directors in their capacities as such, unless the Chairman of the
Board of the Company shall reasonably determine that delivery of
such materials to Stockholder is detrimental to the Company.
Stockholder acknowledges its intent (without an obligation) that
the observer be the same person for purposes of providing
continuity. Upon the request of the Chairman of the Company, the
observer will excuse himself from any portion of the Board or
committee meetings if the Chairman of the Board of the Company
shall reasonably determine that the observer's presence is
detrimental to the Company. The materials furnished to
Stockholder and the discussions and presentations in connection
with or at such meetings shall be considered confidential
information not to be disclosed to any third party unless such
information is generally available to the public or disclosure is
required by law.
11.2 Limitations
During the Development Period, without the prior
written consent of Stockholder, the Company will not enter into
any agreement or obligation that could reasonably be anticipated
to prevent the Company from meeting the milestones listed in an
Exhibit to the Development Agreement.
12. Miscellaneous
12.1 Amendments and Waivers
Any provision of this Agreement may be amended and the
observance thereof may only be waived (either generally or in a
particular instance and either retroactively or prospectively),
with the written consent of the Company and the Holders of a
majority of the Registrable Securities then outstanding. Any
amendment or waiver effected in accordance with this Section 12.1
shall be binding upon each Holder of Registrable Securities at
the time outstanding, each future Holder of Registrable
Securities, and the Company.
12.2 Notices
Any notice required or permitted under this Agreement
will be given in writing, shall be effective when received, and
shall in any event be deemed received and effectively given upon
personal delivery to the party to be notified or three (3)
business days after deposit with the United States Post Office,
by registered or certified mail, postage prepaid, or one (1)
business day after deposit with a nationally recognized courier
service such as Federal Express for next business day delivery,
or one (1) business day after facsimile with copy delivered by
registered or certified mail, postage prepaid and addressed to
the party to be notified at the address indicated for such party
on the signature page hereof or at such other address as the
Shareholder or the Company may designate by giving at least ten
(10) days advance written notice pursuant to this Section 12.2
12.3 Governing Law
This Agreement shall for all purposes be governed by
and construed in accordance with the internal laws of the State
of Delaware without regard to conflicts-of-laws
12
principles. The parties hereto agree to submit to the
jurisdiction of the federal and state courts of the County of
Santa Xxxxx in the State of California with respect to the breach
or interpretation of this Agreement or the enforcement of any and
all rights, duties, liabilities, obligations, powers and other
relations between parties arising under this Agreement.
12.4 Severability
If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision shall be
excised from this Agreement, and the remainder of this Agreement
shall be interpreted as if such provision were so excised and
shall be enforceable in accordance with its remaining terms.
12.5 Counterparts
This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original and
all of which together shall constitute one and the same
instrument.
12.6 Effectiveness.
Any other provision of this Agreement to the contrary
notwithstanding, neither party to this Agreement shall have any
obligation to the other under this Agreement unless and until the
Closing under the Common Stock Purchase Agreement between the
parties dated March 22, 1997 shall have occurred.
12.7 Assignment.
The rights set forth in this Agreement are not
transferable except to a person controlling, controlled by, or
under common control with Holder. All transferees shall agree in
writing to be bound by all of the provisions of this Agreement.
A Holder shall promptly advise the Company in writing of the
identity and address of any person to whom it transferred its
registration rights hereunder.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this
Investor Rights Agreement as of the date first above written.
AVID TECHNOLOGY, INC. INTEL CORPORATION
By: /s/Xxxxxxx X. Xxxxxxxx By: /s/Xxxxxx Xxxxxxx
Name: Xxxxxxx X. Xxxxxxxx Name: Xxxxxx Xxxxxxx
Title: Senior Vice Title: Vice President and
President of Finance Treasurer
and Chief Financial
Officer
Address: Metropolitan Address: 2200 Mission College
Technology Park Boulevard
One Park West M/S XX0-000
Xxxxxxxxx, Xxxxx Xxxxx,
Xxxxxxxxxxxxx 00000 California 95052
Attention: General Counsel Attention: Treasurer
Telephone No.: (000) 000-0000 Telephone No.:(000) 000-0000
Facsimile No.: (000) 000-0000 Facsimile No.:(000) 000-0000
with a copy to
Address: SC4-203
0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: General Counsel
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
[Signature Page to Investor Rights Agreement]
