Exhibit 4.2
XXXXXXX.XXX, INC.
May 3, 1999
To the Purchasers of the
Series A Preferred Stock
of Xxxxxxx.xxx, Inc.
Re: Right to Participate in Initial Public Offering
Ladies and Gentlemen
This letter will confirm our agreement that, subject to and in consideration of
the purchase of shares of Series A Convertible Preferred Stock of Xxxxxxx.xxx,
Inc. (the "Company") by TCV III (GP), TCV III, L.P., TCV III (Q), L.P., TCV III
Strategic Partners, L.P. (the "IPO Holders"), in connection with the Company's
firm commitment underwritten initial public offering (the "IPO"), the Company
shall use its best efforts to cause the managing underwriter or underwriters of
such IPO to offer to each IPO Holder the right to purchase at least that number
of shares of capital stock of the Company determined by multiplying (a) their
Pro-Rata Share by (b) the number of IPO Shares. If an IPO Holder wishes to
purchase IPO Shares, it shall promptly respond to such offer within the time
frame reasonably requested by the managing underwriter(s). The term "Pro- Rata
Share" shall mean that fraction, the numerator of which is equal to the number
of shares of Series A Convertible Preferred Stock (determined on an as-converted
basis) held by such IPO Holder and the denominator of which is the total number
of shares of Series A Convertible Preferred Stock (determined on an as-converted
basis) held by all IPO Holders.
The term "IPO Shares" shall mean that number of shares equal to the quotient
obtained by dividing $3,000,000 by the gross price per share negotiated by the
Company with the managing underwriter or underwriters as reflected on the final
prospectus.
To the extent that one or more of the IPO Holders does not offer to purchase its
full Pro-Rata Share of the IPO Shares, the Company shall use its best efforts to
cause the managing underwriter or underwriters to offer any remaining IPO Shares
to the participating IPO Holders based on such holder's Pro-Rata Share. The IPO
Holders shall have the right to apportion its participation in the IPO pursuant
to this Letter Agreement among any of its partners, members or affiliates.
To the Purchasers of the May 3, 1999
Series A Preferred Stock of Petopia, Inc. Page 2
Notwithstanding the foregoing, all action taken pursuant to this Letter
Agreement shall be made in accordance with all federal and state securities
laws, including, without limitation, Rule 134 of the Securities Act of 1933, as
amended, and all applicable rules and regulations promulgated by the National
Association of Securities Dealers, Inc. and other such self-regulating
organizations.
Very truly yours,
XXXXXXX.XXX, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
ACKNOWLEDGED AND AGREED:
TCV III (GP)
a Delaware General Partnership
By: Technology Crossover Management III L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
TCV III L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
TCV III(Q), L.P.
a Delaware limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
TCV III Strategic Partners, L.P.
a Delaware Limited Partnership
By: Technology Crossover Management III, L.L.C.,
Its: General Partner
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chief Financial Officer
SIGNATURE PAGE TO IPO ALLOCATION LETTER
Mailing Address:
Technology Crossover Ventures
00 Xxxx Xxxxxx, Xxxxx 000 Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Technology Crossover Ventures
000 Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 000 01
Attention. Xxx X. Xxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
