REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of September 30, 1999 by and among Netopia, Inc., a Delaware
corporation ("Netopia"), and the persons and entities listed on Exhibit A
attached hereto (the "Stockholders," and each individually a "Stockholder"),
each of whom immediately prior to the effective time of the Merger (defined
below) was a Stockholder of StarNet Technologies, Inc., a California corporation
("StarNet").
BACKGROUND
A. StarNet, Netopia and SN Merger Corporation, a Delaware corporation
("Sub") and a wholly-owned subsidiary of Netopia, have entered into an Agreement
and Plan of Reorganization dated as of September 28, 1999 (the "Plan"), pursuant
to which StarNet shall merge with and into Sub in a forward triangular merger
(the "Merger"), with Sub to be the surviving corporation. The capitalized terms
used in this Agreement and not otherwise defined herein will have the meanings
given them in the Plan.
B. As a condition to the consummation of the Merger, the Plan provides
that each Stockholder who executes and delivers this Agreement shall be granted
certain registration rights with respect to those shares of Netopia Common Stock
issued to such Stockholders in the Merger, on the terms, and subject to the
conditions and limitations set forth in this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
1. REGISTRATION RIGHTS.
1.1 Definitions. For purposes of this Section 1:
(a) Founder. The term "Founder" means Xxxxxx
Xxxxxx, Xxxxxx Xxxxxxx, Xxxx Xxx, and Xxxxxxxx Xxxxxxxx.
(b) Holder. The term "Holder" means any person owning
of record at the time in question, Registrable
Shares.
(a) Registration. The terms "register,"
"registration" and "registered" refer to a registration effected by preparing
and filing a Registration Statement in compliance with the Securities Act of
1933, as amended (the "1933 Act"), and the declaration or ordering of
effectiveness of such Registration Statement.
1.2 Registration. As soon as reasonably practicable, but in
any event no later than the later of 15 days after the Closing of the Merger, or
five days after all documents required to be filed with the Registration
Statement (including, without limitation, required financial statements and
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auditors' consents) have been made available to Netopia, Netopia shall use its
best efforts to file a Registration Statement on Form S-3 (or other available
form) with the U.S. Securities and Exchange Commission ("SEC") covering the
resale of the Netopia Common Stock issuable pursuant to the Plan (the
"Registrable Shares"). Netopia shall use all reasonable efforts to promptly
obtain all documents required to be filed with the Registration Statement.
Subject to the provisions of 1.7 of this Agreement restricting sales during a
Blackout Period, when an event occurs which is required to be set forth in an
amendment to the Registration Statement, Netopia shall promptly inform the
Stockholders of such occurrence and will file with the SEC such amendment.
1.3 Expenses. Netopia will pay all expenses of any
registration effected under this Section 1, other than the fees and expenses of
counsel to the Stockholders.
1.4 Termination of Registration. Netopia shall use its best
efforts to maintain the effectiveness of the Registration Statement for up to
three hundred and sixty-five (365) days from the effective date of the
Registration Statement but may terminate the Registration Statement sooner (a)
at such time as all of the Registrable Shares covered by the Registration
Statement have been sold, or (b) as to any particular Holder, at such time as,
in the reasonable opinion of Netopia's counsel, Holder may publicly sell all of
the Registrable Shares held by such Holder in any 90 day period without regard
to volume restrictions under Rule 144 under the 0000 Xxx.
1.5 Agreement Not to Sell. Except for sales made in compliance
with Rule 144 of the the 1933 Act, until a Form S-3 has been filed and declared
effective, Stockholder will not sell any Registrable Shares publicly on the
Nasdaq Stock Market or any other stock exchange or market system on which
securities of the same class as the Registrable Shares are traded.
1.6 Sale Notice. Stockholder shall give at least two business
days' prior written notice (a "Sale Notice") to Netopia of any proposed sale of
any Registrable Shares pursuant to any registration and shall not make such sale
(i) unless such two business days lapse without response from Netopia, (ii)
during any Specified Blackout Period (except for Holders who are not Affiliated
Stockholders, as defined below) or Other Blackout Period as described below, or
(iii) if Netopia responds within such two business day period by stating that a
prospectus supplement or post-effective amendment will be filed pursuant to this
Agreement or that it is necessary for Netopia to make an appropriate filing
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), so as to
cause the prospectus to become current, until Netopia has notified Stockholder
that any such post-effective amendment has become effective, prospectus
supplement has been filed or 1934 Act filing has been made. If Netopia
determines that an amendment, supplement or 1934 Act filing will be prepared or
filed as provided above, it will cause the amendment, supplement or filing to be
made as soon as practicable thereafter and, in all events, within 45 days from
the date of delivery of the Sale Notice and, in the case of an amendment, become
effective as soon as practicable and will notify Stockholder promptly when such
filing has been made and, in the case of an amendment, become effective. A Sale
Notice shall be effective for 30 days after the date upon which Stockholder is
first entitled to sell the Registrable Shares proposed for sale following a Sale
Notice.
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1.7 Blackout Period. Notwithstanding any other provision of
this Agreement, Stockholder acknowledges that Netopia has xxxxxxx xxxxxxx
policies that prohibit certain persons from acquiring or disposing of securities
of Netopia during certain specified periods because of the likelihood of the
existence of a material development or potential material development involving
Netopia which has not been publicly disclosed ("Material Nonpublic Information")
(such specified periods referred to as "Specified Blackout Periods"), and that
at other times when such a person indicates a desire to acquire or dispose of
securities of Netopia, Netopia may advise against, and/or prohibit such persons
from, engaging in such transaction because of the existence of Material
Nonpublic Information that in Netopia's reasonable judgment would require a
prospectus supplement or post-effective amendment to be filed with the SEC,
until (i) such information is no longer Material Nonpublic Information or (ii)
until further public disclosures (including, without limitation, an amendment or
supplement to a registration statement or a 1934 Act filing) of such information
are made (such periods when Netopia advises against and/or prohibits such
transactions are referred to as "Other Blackout Periods"). Each Stockholder
agrees that at any time that the Stockholder is an employee, officer or director
of Netopia following the Merger (each, an "Affiliated Stockholder"), Stockholder
will not sell any Registrable Shares during any Specified Blackout Period. In
addition, each Stockholder agrees that Netopia may delay Stockholder's ability
to sell Registrable Shares pursuant to the Form S-3 if Netopia delivers a
certificate in writing to Stockholder (a "Blackout Notice") to the effect that
an Other Blackout Period is in effect. In such an event, Stockholder shall
immediately cease any sales of Registrable Shares and shall not sell any further
Registrable Shares from the period commencing with receipt of the Blackout
Notice and ending upon receipt of the notice referred to in the next sentence
that the Other Blackout Period has terminated. If Stockholder has delivered a
Sale Notice and Netopia has delivered a Blackout Notice, then Netopia shall
notify Stockholder promptly but in no event later than two (2) business days
following the termination of any Other Blackout Period.
1.8 Cooperation by Stockholder. It will be a condition
precedent to the obligations of Netopia to register any Registrable Shares
pursuant to this Agreement that Stockholder furnish to Netopia for inclusion in
the S-3 registration statement such information regarding Stockholder and the
Registrable Shares and the intended method of disposition of such securities as
shall be required to timely effect the registration of the Registrable Shares.
1.9 Manner of Sales. Stockholder will sell the Registrable
Shares pursuant to the Form S-3 only in "brokers' transactions" (as defined in
Rule 144 under the 1933 Act).
1.10. Obligations of Netopia. Subject to the provisions of
Section 14.7, Netopia shall, as expeditiously as reasonably possible, take the
following actions.
(a) Amendment, Supplements. Netopia will prepare and file with
the SEC such amendments and supplements to such registration statement and the
prospectus used in connection with such registration statement as Netopia
determines may be necessary or appropriate, and use its best efforts to have
such post-effective amendments declared effective as promptly as practicable.
Netopia will notify Stockholder promptly when a prospectus, any prospectus
supplement or post-effective amendment has been filed and, with respect to any
post-effective amendment, when the same has become effective.
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(b) Copies of Prospectus. Netopia will furnish to Stockholder
such number of copies of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such other documents
as Stockholder may reasonably request in order to facilitate the disposition of
the Registrable Shares owned by it that are included in such registration.
1.11 Termination of Netopia's Obligations. Netopia shall have
no obligations pursuant to Sections 1.2 with respect to any Registrable Shares
proposed to be sold by a Stockholder in a registration pursuant to Section 1.2
if, in the reasonable opinion of counsel to Netopia, all such Registrable Shares
proposed to be sold by a Stockholder may be sold in a three-month period without
registration under the Securities Act pursuant to Rule 144 under the Securities
Act. ("Rule 144(k) Shares") At such time as such Registrable Securities
constitute Rule 144(k) Shares, upon the request of a Holder of Rule 144(k)
Shares (accompanied, if Netopia requests, by an opinion of counsel reasonably
satisfactory to Netopia that such shares constitute Rule 144(k) Shares), Netopia
will remove any restrictive federal legend from certificates representing Rule
144(k) Shares.
1.12 Restrictions on Resale.
(a) StarNet Founders. StarNet's Founders shall not sell any
Netopia Common Stock that the StarNet Founder receives in exchange for
outstanding StarNet capital stock pursuant to the Merger (the "Merger Shares")
until January 25, 2000, at which time each Founder may sell up to a maximum of
fifty percent (50%) of such Founder's Merger Shares. Each Founder may sell the
remaining fifty percent (50%) of his Merger Shares after April 25, 2000. At all
times, any sales of Netopia Common Stock by a Founder will be subject to
Netopia's Stock Trading Policy (including but not limited to Netopia's Trading
Window for employees, and prohibitions against xxxxxxx xxxxxxx). Each Founder
agrees to sell any of his Netopia shares only through Netopia's investment
bankers and market makers.
(b) Holders of StarNet Preferred Stock. Each former holder of
StarNet Preferred Stock who sells twenty-five thousand (25,000) or more shares
of Netopia stock in any single transaction shall place and execute such sales
only through Netopia's investment bankers and market makers.
2. ASSIGNMENT AND AMENDMENT.
2.1 Assignment. Notwithstanding anything herein to the
contrary, the rights of a Holder under this Agreement may be assigned only with
Netopia's express prior written consent, which may be withheld in Netopia's sole
discretion; provided, however, that the rights of a Holder under this Agreement
may be assigned without Netopia's express prior written consent: (a) to a
Permitted Assignee (as defined below); or (b) (if applicable) by will or by the
laws of intestacy, descent or distribution, provided that any assignee described
in this sentence agrees in writing to be bound by all the obligations of the
Holders under this Agreement. Any attempt to assign any rights of a Holder under
this Agreement without Netopia's express prior written consent in a situation in
which such consent is required by this Section shall be null and void and
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without effect. Subject to the foregoing restrictions, all rights, covenants and
agreements in this Agreement by or on behalf of the parties hereto will bind and
inure to the benefit of the respective permitted successors and assigns of the
parties hereto. Each of the following parties are "Permitted Assignees" of a
Holder for purposes of this Section 2: (a) a trust whose beneficiaries consist
solely of such Holder or such Holder's immediate family; (b) the personal
representative (such as an executor of such Holder's will), custodian or
conservator of such Holder, in the case of the death, bankruptcy or adjudication
of incompetency of such Holder; (c) partners of such Holder (if such Holder is a
partnership); or (d) another Holder or the Permitted Assigns of another Holder.
2.2 Amendment of Rights. Any provision of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of Netopia and Holders holding a majority of the aggregate
number of outstanding Registrable Shares held by all Holders at the time of such
amendment or waiver. Any amendment or waiver effected in accordance with this
Section 2.2 shall be binding upon each Stockholder, each Holder, each permitted
successor or assignee of such Stockholder or Holder and Netopia; provided,
however, that any such amendment or waiver shall not increase the obligation of
any Holder without the specific written consent of such Holder.
3. GENERAL PROVISIONS.
3.1 Notices. All notices and other communications required or
permitted under this Agreement will be in writing and will be either hand
delivered in person, sent by telecopier, sent by certified or registered first
class mail, postage pre-paid, or sent by nationally recognized express courier
service. Such notices and other communications will be effective upon receipt if
hand delivered, one business day after transmission by telecopier with
confirmation of receipt, five (5) days after mailing if sent by mail, and one
(1) day after dispatch if sent by express courier, to the following addresses,
or such other addresses as any party may notify the other parties in accordance
with this Section. Any notice, request or other communication required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if personally delivered or if deposited in the U.S. mail by registered or
certified mail, return receipt requested, postage prepaid, as follows:
If to Netopia: Netopia, Inc.
0000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Fax Number: (000) 000-0000
With a copy to: Fenwick & West LLP
Xxx Xxxx Xxxx Xxxxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: C. Xxxxx Xxxxx
Fax: (000) 000-0000
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If to the Representative: Xxxxxx Xxxxxx
00000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
With a copy to: Venture Law Group
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Attention: Tae Xxx Xxxx
Fax: (000) 000-0000
If to a Stockholder, at such Stockholder's address as set forth on Exhibit A
hereto.
3.2 Entire Agreement. This Agreement, together with all the
Exhibits hereto, constitutes and contains the entire agreement and understanding
of the parties with respect to the subject matter hereof and supersedes any and
all prior negotiations, correspondence, agreements, understandings, duties or
obligations between the parties respecting the subject matter hereof.
3.3 Governing Law; Consent to Jurisdiction. This Agreement
shall be governed by the laws of the State of Delaware except for those
provisions governing conflict of laws, notwithstanding that one or more of the
parties to this Agreement is now, or may hereafter become, a resident or citizen
of a different State. Each party irrevocably consents to the exclusive
jurisdiction and venue of the state and federal courts for Alameda County,
California in connection with any action to enforce the provisions of this
Agreement, to recover damages or other relief for breach or default of this
Agreement, or otherwise arising under or by reason of this Agreement, and agrees
that service of process in any such action may be effected by the means provided
in this Agreement for delivery of notices.
3.4 Severability. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, then such provision(s) shall
be excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.
3.5 Third Parties. Nothing in this Agreement, express or
implied, is intended to confer upon any person, other than the parties hereto
and their successors and assigns, any rights or remedies under or by reason of
this Agreement.
3.6 Successors And Assigns. Subject to the provisions of
Section 2.1, the provisions of this Agreement shall inure to the benefit of, and
shall be binding upon, the successors and permitted assigns of the parties
hereto.
3.7 Captions. The captions to sections of this Agreement have
been inserted for identification and reference purposes only and shall not be
used to construe or interpret this Agreement.
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3.8 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
3.9 Costs And Attorneys' Fees. In the event that any action,
suit or other proceeding is instituted concerning or arising out of this
Agreement or any transaction contemplated hereunder, the prevailing party shall
recover all of such party's costs and attorneys' fees incurred in each such
action, suit or other proceeding, including any and all appeals or petitions
therefrom.
3.10 Absence of Third Party Beneficiary Rights. No provisions
of this Agreement are intended, nor will be interpreted, to provide or create
any third party beneficiary rights or any other rights of any kind in any
client, customer, affiliate, partner or employee of any party hereto or any
other person or entity, unless specifically provided otherwise herein, and,
except as so provided, all provisions hereof will be personal solely between the
parties to this Agreement.
3.11 Effectiveness of Agreement. Regardless of when signed,
this Agreement will not become effective or binding unless and until the
Effective Time of the Merger.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date and year first written above.
NETOPIA, INC.
By: ___________________________
Name: ___________________________
Title: ___________________________
STOCKHOLDERS
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
[Signature Page #1 To Registration Rights Agreement]
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_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
_________________________________ __________________________________
Name: Name:
[Signature Page #2 To Registration Rights Agreement]
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Exhibit A
SCHEDULE OF STOCKHOLDERS
Name and Address Registerable Netopia Shares
Basil and Xxxxxxxx Xxxxx 6683
000 Xxxx Xxxxxx Xxxxx
Xxx Xxxxx, XX 00000
Duke Xxxxxx Xxx 2381
00000 Xxxxxxx Xxxxxx #00
Xxxxxxxxx, XX 00000
Yogesh Xxxxx Xxxxxxxx and 939
Xxxxxxxxx Xxxxxx Xxxxxxxx
000 X. Xxxxxxxxx Xxxxx # 000X
Xxxxxxxxx, XX 00000
Xxxxxx Xx Xxxx 563
7044 Via Serena
Xxx Xxxx, XX 00000
Xxxxx X. Dham 6,683
00000 Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Sanjay and Xxxxxx Xxxxxx 66,838
00000 Xxxxxxxx Xxxx
Xxxxxxx, XX 00000
Xxxxx Xxxx-Xxxx Ho 1,670
0000 X'Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxxxx X. Xxxx 2,993
00000 Xxxx Xxxxx
Xxxxxxx, XX 00000
Xxxxxx Xxxxxxx 33,419
0000 Xxxxxxx Xxxxx # X-000
Xxxxxxxx, XX 00000
00
Xxxx Xxx xxx Xxxxx Xxxx Xxx 33,419
0000 Xxxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxx Xxxx and 250
Xxxxxxxx Xxx Xxxx
000 Xxxxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Tae Hea Namn and 501
Xxxxxxxxx Namn
000 X. Xxxxx Xxx.
Xxx Xxxxx, XX 00000
Xxxxxxxx Xxxxxxxx and 25,481
Anjali Ayyappan
0000 Xxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxxxx Xxxxxxx 3,557
0000 Xxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxx X. Xxxx 1,524
0000 Xxxxxxxxxx Xxx
Xxx Xxxx, XX 00000
VLG Investments 1998 1,169
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Xxxx X. Xx 1,065
0000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxx Xxxx Win 1,670
c/o Xxxxx Xxxx-Xxxx Ho
0000 X'Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
X'Xxxxxxx Holdings Pte. Ltd 33,419
c/o Xxxxx Xxxx-Xxxx Ho
0000 X'Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Wearnes Technology Pte. Ltd. 223,617
c/o Xxxxx Xxxx-Xxxx Ho
0000 X'Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
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