ETOYS INC.
SECOND AMENDED AND RESTATED
INVESTORS' RIGHTS AGREEMENT
MARCH 24, 1999
ETOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
This Second Amended and Restated Investors' Rights Agreement (the
"AGREEMENT") is made as of the 24th day of March, 1999, by and among eToys
Inc., a Delaware corporation (the "COMPANY"), Xxxxxx X. Xxxx and Xxxxx X.
Xxx, each of whom is herein referred to as a "FOUNDER", the prior investors
listed on EXHIBIT A hereto (the "PRIOR INVESTORS") and the new investors
listed on EXHIBIT B hereto (the "NEW INVESTORS"). The Prior Investors and
the New Investors are referred to herein collectively as the "INVESTORS" and
each individually as an "INVESTOR".
RECITALS
The Company, the Founders and the Prior Investors entered into an
Amended and Restated Investors' Rights Agreement on June 4, 1998 (the
"EXISTING AGREEMENT").
The Company and the New Investors have entered into a Series C Preferred
Stock Purchase Agreement (the "PURCHASE AGREEMENT") of even date herewith
pursuant to which the Company desires to sell to the New Investors and the
New Investors desire to purchase from the Company shares of the Company's
Series C Preferred Stock. A condition to the New Investors' obligations
under the Purchase Agreement is that the Company, the Founders and the Prior
Investors enter into this Agreement in order to provide the New Investors
with (i) certain rights to register shares of the Company's Common Stock
issuable upon conversion of the Series C Preferred Stock held by the New
Investors, (ii) certain rights to receive or inspect information pertaining
to the Company, and (iii) a right of first offer with respect to certain
issuances by the Company of its securities. The Company, the Prior Investors
and the Founders each desire to induce the New Investors to purchase shares
of Series C Preferred Stock pursuant to the Purchase Agreement by agreeing to
amend and restate the terms and conditions of the Existing Agreement as set
forth herein.
AGREEMENT
The parties hereby agree as follows:
1. REGISTRATION RIGHTS. The Company and the Investors covenant and
agree as follows:
1.1 DEFINITIONS. For purposes of this Section 1:
(a) The terms "REGISTER," "REGISTERED," and "REGISTRATION"
refer to a registration effected by preparing and filing a registration
statement or similar document in compliance with the Securities Act of 1933,
as amended (the "SECURITIES ACT"), and the declaration or ordering of
effectiveness of such registration statement or document;
(b) The term "REGISTRABLE SECURITIES" means (i) the shares of
Common Stock issuable or issued upon conversion of the Series A Preferred
Stock, (ii) the shares of Common Stock issuable or issued upon conversion of
the Series B Preferred Stock, (iii) the shares of Common Stock issuable or
issued upon conversion of the Series C Preferred Stock and (iv) the shares of
Common Stock issued to the Founders (the "FOUNDERS' STOCK"), PROVIDED,
HOWEVER, that for the purposes of Section 1.2, 1.4 or 1.13 the Founders'
Stock shall not be deemed Registrable Securities and the Founders shall not
be deemed Holders, and (iii) any other shares of Common Stock of the Company
issued as (or issuable upon the conversion or exercise of any warrant, right
or other security which is issued as) a dividend or other distribution with
respect to, or in exchange for or in replacement of, the shares listed in (i)
and (ii); PROVIDED, HOWEVER, that the foregoing definition shall exclude in
all cases any Registrable Securities sold by a person in a transaction in
which his or her rights under this Agreement are not assigned.
Notwithstanding the foregoing, Common Stock or other securities shall only be
treated as Registrable Securities if and so long as they have not been (A)
sold to or through a broker or dealer or underwriter in a public distribution
or a public securities transaction, or (B) sold in a transaction exempt from
the registration and prospectus delivery requirements of the Securities Act
under Section 4(1) thereof so that all transfer restrictions, and restrictive
legends with respect thereto, if any, are removed upon the consummation of
such sale;
(c) The number of shares of "REGISTRABLE SECURITIES THEN
OUTSTANDING" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are, Registrable
Securities;
(d) The term "HOLDER" means any person owning or having the
right to acquire Registrable Securities or any assignee thereof in accordance
with Section 1.12 hereof;
(e) The term "FORM S-3" means such form under the Securities
Act as in effect on the date hereof or any successor form under the
Securities Act; and
(f) The term "SEC" means the Securities and Exchange
Commission.
1.2 REQUEST FOR REGISTRATION.
(a) If the Company shall receive at any time after the
earlier of (i) November 26, 2002, or (ii) one hundred eighty (180) days after
the effective date of the first registration statement for a public offering
of securities of the Company (other than a registration statement relating
either to the sale of securities to employees of the Company pursuant to a
stock option, stock purchase or similar plan or an SEC Rule 145 transaction),
a written request from the Holders of twenty-five percent (25%) or more of
the Registrable Securities then outstanding that the Company file a
registration statement under the Securities Act covering the registration of
at least twenty-five percent (25%) of the Registrable Securities then
outstanding (or a lesser percent if the anticipated aggregate offering price,
net of underwriting discounts and commissions, would exceed $5,000,000), then
the Company shall, within ten (10) days of the receipt thereof, give written
notice of such request to all Holders and shall, subject to the limitations
of subsection 1.2(b), use its best efforts to effect as soon as practicable,
and in any
-2-
event within 60 days of the receipt of such request, the registration under
the Securities Act of all Registrable Securities which the Holders request to
be registered within twenty (20) days of the mailing of such notice by the
Company in accordance with Section 3.5.
(b) If the Holders initiating the registration request
hereunder ("INITIATING HOLDERS") intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall
so advise the Company as a part of their request made pursuant to this
Section 1.2 and the Company shall include such information in the written
notice referred to in subsection 1.2(a). The underwriter will be selected by
a majority in interest of the Initiating Holders and shall be reasonably
acceptable to the Company. In such event, the right of any Holder to include
his Registrable Securities in such registration shall be conditioned upon
such Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting (unless otherwise
mutually agreed by a majority in interest of the Initiating Holders and such
Holder) to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company
as provided in subsection 1.5(e)) enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwriting by a majority in interest of the Initiating Holders.
Notwithstanding any other provision of this Section 1.2, if the underwriter
advises the Initiating Holders in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the Company shall
so advise all Holders of Registrable Securities which would otherwise be
underwritten pursuant hereto, and the number of shares of Registrable
Securities that may be included in the underwriting shall be allocated among
all Holders thereof, including the Initiating Holders, in proportion (as
nearly as practicable) to the amount of Registrable Securities of the Company
owned by each Holder; PROVIDED, HOWEVER, that the number of shares of
Registrable Securities to be included in such underwriting shall not be
reduced unless all other securities are first entirely excluded from the
underwriting.
(c) Notwithstanding the foregoing, if the Company shall
furnish to Holders requesting a registration statement pursuant to this
Section 1.2, a certificate signed by the President of the Company stating
that in the good faith judgment of the Board of Directors of the Company, it
would be seriously detrimental to the Company and its stockholders for such
registration statement to be filed and it is therefore essential to defer the
filing of such registration statement, the Company shall have the right to
defer such filing for a period of not more than 90 days after receipt of the
request of the Initiating Holders; PROVIDED, HOWEVER, that the Company may
not utilize this right more than once in any twelve-month period.
(d) In addition, the Company shall not be obligated to
effect, or to take any action to effect, any registration pursuant to this
Section 1.2:
(i) After the Company has effected two (2)
registrations pursuant to this Section 1.2 and such registrations have been
declared or ordered effective;
(ii) During the period starting with the date sixty
(60) days prior to the Company's good faith estimate of the date of filing
of, and ending on a date one hundred eighty (180) days after the effective
date of, a registration subject to Section 1.3 hereof;
-3-
provided that the Company is actively employing in good faith all reasonable
efforts to cause such registration statement to become effective; or
(iii) If the Initiating Holders propose to dispose of
shares of Registrable Securities that may be immediately registered on Form
S-3 pursuant to a request made pursuant to Section 1.4 below.
1.3 COMPANY REGISTRATION. If (but without any obligation to do
so) the Company proposes to register (including for this purpose a
registration effected by the Company for stockholders other than the Holders)
any of its stock under the Securities Act in connection with the public
offering of such securities solely for cash (other than a registration
relating solely to the sale of securities to participants in a Company stock
plan or a transaction covered by Rule 145 under the Securities Act, a
registration in which the only stock being registered is Common Stock
issuable upon conversion of debt securities which are also being registered,
or any registration on any form which does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of the Registrable Securities), the Company shall, at such
time, promptly give each Holder written notice of such registration. Upon
the written request of each Holder given within twenty (20) days after
mailing of such notice by the Company in accordance with Section 3.5, the
Company shall, subject to the provisions of Section 1.8, cause to be
registered under the Securities Act all of the Registrable Securities that
each such Holder has requested to be registered.
1.4 FORM S-3 REGISTRATION. In case the Company shall receive from
any Holder or Holders of not less than twenty-five percent (25%) of the
Registrable Securities then outstanding, or a lesser percentage if the
aggregate offering price of the Registrable Securities to be included in the
registration is at least $5,000,000, a written request or requests that the
Company effect a registration on Form S-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities owned
by such Holder or Holders, the Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other
Holders; and
(b) as soon as practicable, effect such registration and all
such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holder's or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written
request given within 15 days after receipt of such written notice from the
Company; PROVIDED, HOWEVER, that the Company shall not be obligated to effect
any such registration, qualification or compliance, pursuant to this Section
1.4: (i) if Form S-3 is not available for such offering by the Holders; (ii)
if the Holders, together with the holders of any other securities of the
Company entitled to inclusion in such registration, propose to sell
Registrable Securities and such other securities (if any) at an aggregate
price to the public (net of any underwriters' discounts or commissions) of
less than $2,000,000; (iii) if the Company shall furnish to the Holders a
certificate signed by the
-4-
President of the Company stating that in the good faith judgment of the Board
of Directors of the Company, it would be seriously detrimental to the Company
and its stockholders for such Form S-3 Registration to be effected at such
time, in which event the Company shall have the right to defer the filing of
the Form S-3 registration statement for a period of not more than 90 days
after receipt of the request of the Holder or Holders under this Section 1.4;
PROVIDED, HOWEVER, that the Company shall not utilize this right more than
once in any twelve month period; (iv) if the Company has already effected
three registrations on Form S-3 for the Holders pursuant to this Section 1.4;
or (v) in any particular jurisdiction in which the Company would be required
to qualify to do business or to execute a general consent to service of
process in effecting such registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other
securities so requested to be registered as soon as practicable after receipt
of the request or requests of the Holders. Registrations effected pursuant
to this Section 1.4 shall not be counted as demands for registration or
registrations effected pursuant to Sections 1.2 or 1.3, respectively.
1.5 OBLIGATIONS OF THE COMPANY. Whenever required under this
Section 1 to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective, and, upon the request of the
Holders of at least twenty-five percent (25%) majority of the Registrable
Securities registered thereunder, keep such registration statement effective
for up to one hundred twenty (120) days. The Company shall not be required
to file, cause to become effective or maintain the effectiveness of any
registration statement that contemplates a distribution of securities on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act.
(b) 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 may be necessary to comply
with the provisions of the Securities Act with respect to the disposition of
all securities covered by such registration statement for up to one hundred
twenty (120) days.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities
or Blue Sky laws of such jurisdictions as shall be reasonably requested by
the Holders, PROVIDED that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.
-5-
(e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such offering. Each
Holder participating in such underwriting shall also enter into and perform
its obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by
such registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities 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 a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the
circumstances then existing, such obligation to continue for one hundred
twenty (120) days.
(g) Cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar
securities issued by the Company are then listed.
(h) Provide a transfer agent and registrar for all
Registrable Securities registered pursuant hereunder and a CUSIP number for
all such Registrable Securities, in each case not later than the effective
date of such registration.
(i) Use its best efforts to furnish, at the request of any
Holder requesting registration of Registrable Securities pursuant to this
Section 1, on the date that such Registrable Securities are delivered to the
underwriters for sale in connection with a registration pursuant to this
Section 1, if such securities are being sold through underwriters, or, if
such securities are not being sold through underwriters, on the date that the
registration statement with respect to such securities becomes effective, (i)
an opinion, dated such date, of the counsel representing the Company for the
purposes of such registration, in form and substance as is customarily given
to underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders requesting registration of
Registrable Securities and (ii) a letter dated such date, from the
independent certified public accountants of the Company, in form and
substance as is customarily given by independent certified public accountants
to underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders requesting registration of
Registrable Securities.
1.6 FURNISH INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration of such
Holder's Registrable Securities. The Company shall have no obligation with
respect to any registration requested pursuant to Section 1.2 or Section 1.4
of this Agreement if, as a result of the application of the preceding
sentence, the number of shares or the anticipated aggregate offering price of
the Registrable Securities to be included in the registration does not equal
or exceed the number of shares or the anticipated aggregate offering price
required to originally trigger the Company's
-6-
obligation to initiate such registration as specified in subsection 1.2(a) or
subsection 1.4(b)(2), whichever is applicable.
1.7 EXPENSES OF REGISTRATION.
(a) DEMAND REGISTRATION. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2, including
(without limitation) all registration, filing and qualification fees,
printers' and accounting fees, fees and disbursements of counsel for the
Company, and the reasonable fees and disbursements of one counsel for the
selling Holders selected by them with the approval of the Company, which
approval shall not be unreasonably withheld, shall be borne by the Company;
PROVIDED, HOWEVER, that the Company shall not be required to pay for any
expenses of any registration proceeding begun pursuant to Section 1.2 if the
registration request is subsequently withdrawn at the request of the Holders
of a majority of the Registrable Securities to be registered (in which case
all participating Holders shall bear such expenses), unless the Holders of a
majority of the Registrable Securities agree to forfeit their right to one
demand registration pursuant to Section 1.2; provided further, however, that
if at the time of such withdrawal, the Holders have learned of a material
adverse change in the condition, business, or prospects of the Company from
that known to the Holders at the time of their request and have withdrawn the
request with reasonable promptness following disclosure by the Company of
such material adverse change, then the Holders shall not be required to pay
any of such expenses and shall retain their rights pursuant to Section 1.2.
(b) COMPANY REGISTRATION. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications of Registrable Securities pursuant
to Section 1.3 for each Holder (which right may be assigned as provided in
Section 1.12), including (without limitation) all registration, filing, and
qualification fees, printers' and accounting fees, fees and disbursements of
counsel for the Company and the reasonable fees and disbursements of one
counsel for the selling Holder or Holders selected by them with the approval
of the Company, which approval shall not be unreasonably withheld, shall be
borne by the Company.
(c) REGISTRATION ON FORM S-3. All expenses incurred in
connection with a registration requested pursuant to Section 1.4, including
(without limitation) all registration, filing, qualification, printers' and
accounting fees and the reasonable fees and disbursements of one counsel for
the selling Holder or Holders selected by them with the approval of the
Company, which approval shall not be unreasonably withheld, and counsel for
the Company, and any underwriters' discounts or commissions associated with
Registrable Securities, shall be borne by the Company.
1.8 UNDERWRITING REQUIREMENTS. In connection with any offering
involving an underwriting of shares of the Company's capital stock, the
Company shall not be required under Section 1.3 to include any of the
Holders' securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected
by it (or by other persons entitled to select the underwriters), and then
only in such
-7-
quantity as the underwriters determine in their sole discretion will not
jeopardize the success of the offering by the Company. If the total amount
of securities, including Registrable Securities, requested by stockholders to
be included in such offering exceeds the amount of securities sold other than
by the Company that the underwriters determine in their sole discretion is
compatible with the success of the offering, then the Company shall be
required to include in the offering only that number of such securities,
including Registrable Securities, which the underwriters determine in their
sole discretion will not jeopardize the success of the offering (the
securities so included to be apportioned pro rata among the selling
stockholders according to the total amount of securities entitled to be
included therein owned by each selling stockholder or in such other
proportions as shall mutually be agreed to by such selling stockholders) but
in no event shall: (i) the amount of securities of the selling Holders
included in the offering be reduced below thirty percent (30%) of the total
amount of securities included in such offering, unless such offering is the
initial public offering of the Company's securities in which case the selling
stockholders may be excluded if the underwriters make the determination
described above and no other stockholder's securities are included; or (ii)
notwithstanding (i) above, any shares being sold by a stockholder exercising
a demand registration right similar to that granted in Section 1.2 be
excluded from such offering; or (iii) any securities held by a Founder be
included if any securities held by any selling Holder are excluded. For
purposes of the preceding parenthetical concerning apportionment, for any
selling stockholder which is a holder of Registrable Securities and which is
a partnership, limited liability company or corporation, the partners,
retired partners, members and stockholders of such holder, or the estates and
family members of any such partners, retired partners and members and any
trusts for the benefit of any of the foregoing persons shall be deemed to be
a single "SELLING STOCKHOLDER," and any pro-rata reduction with respect to
such "selling stockholder" shall be based upon the aggregate amount of shares
carrying registration rights owned by all entities and individuals included
in such "selling stockholder," as defined in this sentence.
1.9 DELAY OF REGISTRATION. No Holder shall have any right to
obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect
to the interpretation or implementation of this Section 1.
1.10 INDEMNIFICATION. In the event any Registrable Securities are
included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder and the partners, officers, directors
and stockholders of each Holder, and any underwriter (as defined in the
Securities Act) for such Holder and each person, if any, who controls such
Holder or underwriter within the meaning of the Securities Act or the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), against any
losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange 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
-8-
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 not misleading, or (iii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state
securities law or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any state securities law; and the Company will pay
to each such Holder, underwriter or controlling person, as incurred, any
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
subsection 1.10(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), 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 which occurs in reliance upon and in conformity
with written information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act, any
underwriter, any other Holder selling securities in such registration
statement and any controlling person of any such underwriter or other Holder,
against any losses, claims, damages, or liabilities (joint or several) to
which any of the foregoing persons may become subject, under the Securities
Act, the Exchange 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 Holder expressly for use in connection
with such registration; and each such Holder will pay, as incurred, any legal
or other expenses reasonably incurred by any person intended to be
indemnified pursuant to this subsection 1.10(b), in connection with
investigating or defending any such loss, claim, damage, liability, or
action; PROVIDED, HOWEVER, that the indemnity agreement contained in this
subsection 1.10(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 Holder, which consent shall not be unreasonably
withheld; PROVIDED, that in no event shall any indemnity under this
subsection 1.10(b) exceed the net proceeds from the offering received by such
Holder, except in the case of willful fraud by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 1.10 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 1.10,
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 mutually satisfactory to the parties; PROVIDED, HOWEVER, that an
indemnified party (together with all other indemnified parties which may be
represented without conflict by one counsel) shall have the right to retain
one separate counsel,
-9-
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 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, if prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 1.10, 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
1.10.
(d) If the indemnification provided for in this Section 1.10
is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage or
expense referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such loss,
liability, claim, damage, or expense in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and of
the indemnified party on the other in connection with the statements or
omissions that resulted in such loss, liability, claim, damage, or expense as
well as any other relevant equitable considerations; PROVIDED, that in no
event shall any contribution by a Holder under this Subsection 1.10(d) exceed
the net proceeds from the offering received by such Holder, except in the
case of willful fraud by such Holder. The relative fault of the indemnifying
party and of the indemnified party shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission to state a material fact relates to information supplied
by the indemnifying party or by the indemnified party and the parties'
relative intent, knowledge, access to information, and opportunity to correct
or prevent such statement or omission.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering
are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control. The Company acknowledges that an
agreement by a Holder to indemnify and hold harmless the indemnitees and
their affiliates and controlling persons which is broader than the
indemnification contained in this Section 1.10 shall not be considered a
conflict between the terms of this Section 1.10 and the indemnification and
contribution provisions contained in the underwriting agreement.
(f) The obligations of the Company and Holders under this
Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.11 REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a view to
making available to the Holders the benefits of Rule 144 promulgated under
the Securities Act and any other rule or regulation of the SEC that may at
any time permit a Holder to sell securities of the Company to the public
without registration or pursuant to a registration on Form S-3, the Company
agrees to:
-10-
(a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144, at all times after ninety
(90) days after the effective date of the first registration statement filed
by the Company for the offering of its securities to the general public so
long as the Company remains subject to the periodic reporting requirements
under Sections 13 or 15(d) of the Exchange Act;
(b) take such action, including the voluntary registration of
its Common Stock under Section 12 of the Exchange Act, as is necessary to
enable the Holders to utilize Form S-3 for the sale of their Registrable
Securities, such action to be taken as soon as practicable after the end of
the fiscal year in which the first registration statement filed by the
Company for the offering of its securities to the general public is declared
effective;
(c) file with the SEC in a timely manner all reports and
other documents required of the Company under the Securities Act and the
Exchange Act; and
(d) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Company that it has complied with the reporting requirements of SEC Rule 144
(at any time after ninety (90) days after the effective date of the first
registration statement filed by the Company), the Securities Act and the
Exchange Act (at any time after it has become subject to such reporting
requirements), or that it qualifies as a registrant whose securities may be
resold pursuant to Form S-3 (at any time after it so qualifies), (ii) a copy
of the most recent annual or quarterly report of the Company and such other
reports and documents so filed by the Company, and (iii) such other
information as may be reasonably requested in availing any Holder of any rule
or regulation of the SEC which permits the selling of any such securities
without registration or pursuant to such form.
1.12 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company to register Registrable Securities pursuant to this Section 1 may be
assigned (but only with all related obligations) by a Holder to a transferee
or assignee of at least 500,000 shares of such securities (subject to stock
splits, combinations and the like) or all of such Holder's shares, if less,
PROVIDED the Company is, within a reasonable time after such transfer,
furnished with written notice of the name and address of such transferee or
assignee and the securities with respect to which such registration rights
are being assigned; and PROVIDED, FURTHER, that such assignment shall be
effective only if immediately following such transfer the further disposition
of such securities by the transferee or assignee is restricted under the
Securities Act. For the purposes of determining the number of shares of
Registrable Securities held by a transferee or assignee, the holdings of
transferees and assignees of a partnership or limited liability company who
are partners or retired partners of such partnership or members of such
limited liability company (including spouses and ancestors, lineal
descendants and siblings of such partners or members or spouses who acquire
Registrable Securities by gift, will or intestate succession) shall be
aggregated together and with the partnership or limited liability company, as
the case may be; provided that all assignees and transferees who would not
qualify individually for assignment of registration rights shall have a
single attorney-in-fact for the purpose of exercising any rights, receiving
notices or taking any action under Section 1.
-11-
1.13 LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and after
the date of this Agreement, the Company shall not, without the prior written
consent of the Holders of a majority of the outstanding Registrable
Securities, enter into any agreement with any holder or prospective holder of
any securities of the Company which would allow such holder or prospective
holder (a) to include such securities in any registration filed under Section
1.2 hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only
to the extent that the inclusion of his securities will not reduce the amount
of the Registrable Securities of the Holders which is included or (b) to make
a demand registration which could result in such registration statement being
declared effective prior to the earlier of either of the dates set forth in
subsection 1.2(a) or within one hundred eighty (180) days of the effective
date of any registration effected pursuant to Section 1.2.
1.14 "MARKET STAND-OFF" AGREEMENT. Each Holder hereby agrees that,
during the period of duration (up to, but not exceeding, 180 days) specified
by the Company and an underwriter of Common Stock or other securities of the
Company, following the effective date of a registration statement of the
Company filed under the Securities Act, it shall not, to the extent requested
by the Company and such underwriter, directly or indirectly sell, offer to
sell, contract to sell (including, without limitation, any short sale), grant
any option to purchase or otherwise transfer or dispose of (other than to
donees who agree to be similarly bound) any securities of the Company held by
it at any time during such period except Common Stock included in such
registration; PROVIDED, HOWEVER, that:
(a) such agreement shall be applicable only to the first such
registration statement of the Company which covers Common Stock (or other
securities) to be sold on its behalf to the public in an underwritten
offering; and
(b) all officers and directors of the Company, all
one-percent securityholders, and all other persons with registration rights
(whether or not pursuant to this Agreement) enter into similar agreements.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of each
Holder (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period, and each Holder agrees
that, if so requested, such Holder will execute an agreement in the form
provided by the underwriter containing terms which are essentially consistent
with the provisions of this Section 1.14.
Notwithstanding the foregoing, the obligations described in this
Section 1.14 shall not apply to a registration relating solely to employee
benefit plans on Form S-1 or Form S-8 or similar forms which may be
promulgated in the future, or a registration relating solely to an SEC Rule
145 transaction on Form S-4 or similar forms which may be promulgated in the
future.
1.15 TERMINATION OF REGISTRATION RIGHTS. No Holder shall be
entitled to exercise any right provided for in this Section 1 after the
earlier of (i) five (5) years following the consummation of the sale of
securities pursuant to a registration statement filed by the Company under
the Securities Act in connection with the initial firm commitment
underwritten offering of
-12-
its securities to the general public, or (ii) such time as Rule 144 or
another similar exemption under the Securities Act is available for the sale
of all of such Holder's shares during a three (3)-month period without
registration.
2. COVENANTS OF THE COMPANY.
2.1 DELIVERY OF FINANCIAL STATEMENTS. The Company shall deliver
to each Investor holding, and to transferees of, at least 500,000 shares of
Registrable Securities (subject to stock splits, combinations and the like):
(a) as soon as practicable, but in any event within ninety
(90) days after the end of each fiscal year of the Company, an income
statement for such fiscal year, a balance sheet of the Company and statement
of stockholder's equity as of the end of such year, and a statement of cash
flows for such year, such year-end financial reports to be in reasonable
detail, prepared in accordance with generally accepted accounting principles
("GAAP"), and audited and certified by an independent public accounting firm
of nationally recognized standing selected by the Company;
(b) as soon as practicable, but in any event within thirty
(30) days after the end of each of the first three (3) quarters of each
fiscal year of the Company, an unaudited profit or loss statement, a
statement of cash flows for such fiscal quarter and an unaudited balance
sheet as of the end of such fiscal quarter;
(c) within thirty (30) days of the end of each month, an
unaudited income statement and a statement of cash flows and balance sheet
for and as of the end of such month, in reasonable detail;
(d) as soon as practicable, but in any event thirty (30) days
prior to the end of each fiscal year, a budget and business plan for the next
fiscal year, prepared on a monthly basis, including balance sheets and
sources and applications of funds statements for such months and, as soon as
prepared, any other budgets or revised budgets prepared by the Company;
(e) with respect to the financial statements called for in
subsections (b) and (c) of this Section 2.1, an instrument executed by the
Chief Financial Officer or President of the Company and certifying that such
financials were prepared in accordance with GAAP consistently applied with
prior practice for earlier periods (with the exception of footnotes that may
be required by GAAP) and fairly present the financial condition of the
Company and its results of operation for the period specified, subject to
year-end audit adjustment, provided that the foregoing shall not restrict the
right of the Company to change its accounting principles consistent with
GAAP, if the Board of Directors determines that it is in the best interest of
the Company to do so; and
(f) such other information relating to the financial
condition, business, prospects or corporate affairs of the Company as the
Investor or any assignee of the Investor may from time to time reasonably
request; PROVIDED, HOWEVER, that the Company shall not be
-13-
obligated under this subsection (f) or any other subsection of Section 2.1 to
provide information which it deems in good faith to be a trade secret or
similar confidential information.
2.2 INSPECTION. The Company shall permit each Investor who holds
not less than 500,000 shares of Registrable Securities (subject to stock
splits, combinations and the like), at such Investor's expense, to visit and
inspect the Company's properties, to examine its books of account and records
and to discuss the Company's affairs, finances and accounts with its
officers, all at such reasonable times as may be requested by the Investor;
PROVIDED, HOWEVER, that the Company shall not be obligated pursuant to this
Section 2.2 to provide access to any information which it reasonably
considers to be a trade secret or similar confidential information.
2.3 RIGHT OF FIRST OFFER. Subject to the terms and conditions
specified in this Section 2.3, the Company hereby grants to each Major
Investor (as hereinafter defined) a right of first offer with respect to
future sales by the Company of its Shares (as hereinafter defined). For
purposes of this Section 2.3, a "MAJOR INVESTOR" shall mean any person who
holds at least 500,000 shares of Series A and/or B Preferred Stock (or the
Common Stock issued upon conversion thereof) (as adjusted for stock splits,
stock dividends, recapitalizations (subject to stock splits, combinations and
the like), issued pursuant to the Purchase Agreement or the Series A
Preferred Stock Purchase Agreement dated as of December 23, 1997. For
purposes of this Section 2.3, Major Investor includes any partners and other
affiliates of a Major Investor. A Major Investor who chooses to exercise the
right of first offer may designate as purchasers under such right itself or
its partners or affiliates in such proportions as it deems appropriate.
Each time the Company proposes to offer any shares of, or
securities convertible into or exercisable for any shares of, any class of
its capital stock ("SHARES"), the Company shall first make an offering of
such Shares to each Major Investor in accordance with the following
provisions:
(a) The Company shall deliver a notice by certified mail
("NOTICE") to the Major Investors stating (i) its bona fide intention to
offer such Shares, (ii) the number of such Shares to be offered, and (iii)
the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within 20 calendar days after delivery of the Notice, the
Major Investor may elect to purchase or obtain, at the price and on the terms
specified in the Notice, up to that portion of such Shares which equals the
proportion that the number of shares of Common Stock issued and held, or
issuable upon conversion and exercise of all outstanding convertible or
exercisable securities then held, by such Major Investor bears to the total
number of shares of Common Stock then outstanding (assuming full conversion
and exercise of all convertible or exercisable securities). The Company
shall promptly, in writing, inform each Major Investor that purchases all the
shares available to it (each, a "FULLY-EXERCISING INVESTOR") of any other
Major Investor's failure to do likewise. During the ten (10)-day period
commencing after receipt of such information, each Fully-Exercising Investor
shall be entitled to obtain that portion of the Shares for which Major
Investors were entitled to subscribe but which were not subscribed for by the
Major Investors that is equal to the proportion that the number of shares of
Common Stock
-14-
issued and held, or issuable upon conversion and exercise of all outstanding
convertible or exercisable securities then held, by such Fully-Exercising
Investor bears to the total number of shares of Common Stock then outstanding
(assuming full conversion and exercise of all convertible or exercisable
securities).
(c) The Company may, during the 45-day period following the
expiration of the period provided in subsection 2.3(b) hereof, offer the
remaining unsubscribed portion of the Shares to any person or persons at a
price not less than, and upon terms no more favorable to the offeree than
those specified in the Notice. If the Company does not enter into an
agreement for the sale of the Shares within such period, or if such agreement
is not consummated within 60 days of the execution thereof, the right
provided hereunder shall be deemed to be revived and such Shares shall not be
offered unless first reoffered to the Major Investors in accordance herewith.
(d) The right of first offer in this paragraph 2.3 shall not
be applicable (i) to the issuance or sale of options or stock purchase rights
to employees, consultants and directors pursuant to plans or agreements
approved by the Board of Directors, (ii) to or after consummation of a public
offering of shares of Common Stock, (iii) to the issuance of securities
pursuant to the conversion or exercise of convertible or exercisable
securities which were originally excluded from this Section 2.3, (iv) to the
issuance of securities in connection with a bona fide business acquisition by
the Company, whether by merger, consolidation, sale of assets, sale or
exchange of stock or otherwise, (v) to the issuance of securities to
financial institutions or lessors in connection with commercial credit
arrangements, equipment financings, or similar transactions, which issuances
are primarily for other than equity financing purposes and provided that the
aggregate of such issuance and similar issuances in the preceding twelve
month period do not exceed 1% of the then outstanding Common Stock of the
Company (assuming full conversion and exercise of all outstanding convertible
and exercisable securities), (vi) to the issuance or sale of the Series C
Preferred Stock, or (vii) the issuance of securities pursuant to a stock
split, stock dividend, recapitalization or other combination.
2.4 TERMINATION OF COVENANTS. The covenants set forth in
Sections 2.1 through Section 2.3 shall terminate as to each Investor and be
of no further force or effect (i) immediately prior to the consummation of
the Company's initial public offering of shares of its Common Stock
registered under the Securities Act, or (ii) when the Company shall sell,
convey, or otherwise dispose of or encumber all or substantially all of its
property or business or merge into or consolidate with any other corporation
(other than a wholly-owned subsidiary corporation) or effect any other
transaction or series of related transactions in which more than fifty
percent (50%) of the voting power of the Company is disposed of, provided
that this subsection (ii) shall not apply to (x) a merger effected
exclusively for the purpose of changing the domicile of the Company, or (y) a
merger or consolidation in which the holders of the Company's voting
securities immediately prior to such transaction continue to own more than
fifty percent (50%) of the voting power of the surviving or resulting entity.
The covenants set forth in Sections 2.1 and 2.2 shall terminate as to each
Investor and be of no further force or effect when the Company first becomes
subject to the periodic reporting requirements of
-15-
Sections 13 or 15(d) of the Exchange Act, if this occurs earlier than the
events described in (i) or (ii) above.
3. MISCELLANEOUS.
3.1 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any of the Series A and/or B Preferred Stock or any Common Stock
issued upon conversion thereof). Nothing in this Agreement, express or implied,
is intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
3.2 GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto shall be governed, construed and interpreted in accordance with
the laws of the State of California, without giving effect to principles of
conflicts of laws.
3.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
3.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
3.5 NOTICES. Unless otherwise provided, any notice required or
permitted by this Agreement shall be in writing and shall be deemed sufficient
upon delivery, when delivered personally or by overnight courier or sent by
telegram or fax, or forty-eight (48) hours after being deposited in the U.S.
mail, as certified or registered mail, with postage prepaid, and addressed to
the party to be notified at such party's address or fax number as set forth
below or on EXHIBIT A hereto or as subsequently modified by written notice.
3.6 EXPENSES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
3.7 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the holders of
at least 66 2/3% of the Registrable Securities then outstanding, not including
the Founders' Stock; provided that if such amendment has the effect of affecting
the Founders' Stock (i) in a manner different than securities issued to the
Investors and (ii) in a manner adverse to the interests of the holders of the
Founders' Stock, then such amendment shall require the consent of the holder or
holders of a majority of the Founders' Stock. Any amendment or waiver effected
in accordance with this paragraph shall be binding upon each
-16-
holder of any Registrable Securities then outstanding, each future holder of
all such Registrable Securities, and the Company.
3.8 SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a) such
provision shall be excluded from this Agreement, (b) the balance of the
Agreement shall be interpreted as if such provision were so excluded and (c) the
balance of the Agreement shall be enforceable in accordance with its terms.
3.9 AGGREGATION OF STOCK. All shares of the Preferred Stock held or
acquired by affiliated entities or persons shall be aggregated together for the
purpose of determining the availability of any rights under this Agreement.
3.10 TERMINATION OF EXISTING AGREEMENT. This Agreement contains the entire
understanding of the parties, and there are no further or other agreements or
understandings, written or oral, in effect between the parties relating to the
subject matter hereof except for the Intel Letter Agreement of even date
herewith, the terms of which are expressly incorporated herein by reference.
The signatories to this Agreement (other than the Company), as the holders of
more than sixty six and two thirds (66 2/3%) in interest of the Registrable
Securities (as defined in the Existing Agreement), hereby agree that the
Existing Agreement is hereby Second Amended and Restated in its entirety by this
Agreement, and the Existing Agreement shall be of no further force or effect.
[Signature Page Follows]
-17-
The parties have executed this Second Amended and Restated Investors'
Rights Agreement as of the date first above written.
COMPANY:
eTOYS INC.
By: /s/ Xxxxxx X. Xxxx
----------------------------------
Xxxxxx X. Xxxx
President and Chief Executive officer
Address: 0000 Xxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
DYNAFUND LP
By: /s/ Xxxxx R.S. Ko
--------------------------------------
Name: Xxxxx R.S. Ko
------------------------------------
(print)
Title: General Partner
-----------------------------------
Address: 00000 Xxxxxxxxx Xxxx., Xxxxx 000
--------------------------------
Xxxxxxxx, XX 00000
--------------------------------
Fax: (000) 000-0000
--------------------------------
DYNAFUND INTERNATIONAL LP
By: /s/ Xxxxx R.S. Ko
--------------------------------------
Name: Xxxxx R.S. Ko
------------------------------------
(print)
Title: General Partner
-----------------------------------
Address: 00000 Xxxxxxxxx Xxxx., Xxxxx 000
--------------------------------
Xxxxxxxx, XX 00000
--------------------------------
Fax: (000) 000-0000
--------------------------------
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTOR:
INTEL CORPORATION
By: /s/ Xxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxx
---------------------------------
(print)
Title: V.P. and Treasurer
--------------------------------
Address: 0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, XX 00000
Attn: Treasurer
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
XXXXX GLOBAL INVESTMENTS, LTD.
By: Xxxxx Capital Management, Inc.
Its: Trading Advisor
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
---------------------------------
(print)
Title: Director of Operations
--------------------------------
Address: c/o Citco Fund Services
(Bahamas), Ltd.
Bahamas Financial Center
Charlotte & Xxxxxxx Xxxxxx
X.X. Xxx XX 00000
Xxxxxx, Bahamas
Fax:
-----------------------------
REMINGTON INVESTMENTS STRATEGIES, L.P.
By: Xxxxx Capital Advisors, L.L.C.
Its: General Partner
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
---------------------------------
(print)
Title: Director of Operations
--------------------------------
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax:
-----------------------------
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
MULTI-STRATEGIES FUND, L.P.
By: Xxxxx Capital Advisors, L.L.C.
Its: General Partner
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
---------------------------------
(print)
Title: Director of Operations
--------------------------------
Address: 0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax:
-----------------------------
MULTI-STRATEGIES FUND LTD.
By: Xxxxx Capital Management, Inc.
Its: Trading Advisor
By: /s/ Xxxxxx Xxxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
---------------------------------
(print)
Title: Director of Operations
--------------------------------
Address: c/o Citco Fund Services
(Bahamas), Ltd.
Bahamas Financial Center
Charlotte & Xxxxxxx Xxxxxx
X.X. Xxx XX 00000
Xxxxxx, Bahamas
Fax:
-----------------------------
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
HIGHLAND CAPITAL PARTNERS III LIMITED
PARTNERSHIP
By: Highland Management Partners III
Limited Partnership, its General
Partner
By: /s/ Xxxxxx X. Nova
-----------------------------------
Name: Xxxxxx X. Nova
---------------------------------
(print)
Title: Member
--------------------------------
Address: c/o Highland Capital Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
HIGHLAND ENTREPRENEURS' FUND III
LIMITED PARTNERSHIP
By: HEF III, LLC, its General Partner
By: /s/ Xxxxxx X. Nova
-----------------------------------
Name: Xxxxxx X. Nova
---------------------------------
(print)
Title: Member
--------------------------------
Address: c/o Highland Capital Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
HIGHLAND CAPITAL PARTNERS IV LIMITED
PARTNERSHIP
By: /s/ Xxxxxx X. Nova
-----------------------------------
Name: Xxxxxx X. Nova
---------------------------------
(print)
Title: Member
--------------------------------
Address: c/o Highland Capital Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
HIGHLAND ENTREPRENEURS' FUND IV
LIMITED PARTNERSHIP
By: /s/ Xxxxxx X. Nova
-----------------------------------
Name: Xxxxxx X. Nova
---------------------------------
(print)
Title: Member
--------------------------------
Address: c/o Highland Capital Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
idealab! CAPITAL PARTNERS I-A, LP
By its General Partner,
idealab! Capital Management I, LLC
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Xxxxxxx Xxxxx
Managing Member
Address: c/o idealab! Capital Partners
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
idealab! CAPITAL PARTNERS I-B, LP
By its General Partner,
idealab! Capital Management I, LLC
By: /s/ Xxxxxxx Xxxxx
-----------------------------------
Xxxxxxx Xxxxx
Managing Member
Address: c/o idealab! Capital Partners
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
BESSEMER VENTURE PARTNERS IV L.P.
By: Deer IV & Co. LLC, General Partner
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Manager
Address: 0000 Xxx Xxxxxxx Xxxx,
Xxxxx 000
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
BESSEMER VENTURE INVESTORS L.P.
By: Deer IV & Co. LLC, General Partner
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Manager
Address: 0000 Xxx Xxxxxxx Xxxx,
Xxxxx 000
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
BESSEC VENTURES IV L.P.
By: Deer IV & Co. LLC, General Partner
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Manager
Address: 0000 Xxx Xxxxxxx Xxxx,
Xxxxx 000
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
INVESTORS:
SEQUOIA CAPITAL VIII
SEQUOIA INTERNATIONAL
TECHNOLOGY PARTNERS VIII
SEQUOIA INTERNATIONAL
TECHNOLOGY PARTNERS VIII (Q)
CMS PARTNERS LLC
SEQUOIA 1997
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxx
---------------------------------
(print)
Title:
--------------------------------
Address: 0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
FOUNDERS:
/s/ Xxxxxx X. Xxxx
-------------------------------
Xxxxxx X. Xxxx
Address: 0000 Xxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Fax: (000) 000-0000
/s/ Xxxxx X. Xxx
-------------------------------
Xxxxx X. Xxx
Address: 0000 Xxxxx Xxxx Xxxxxxxxx
Xxxxx 000
Xxxxx Xxxxxx, XX 00000
Fax: (000) 000-0000
SIGNATURE PAGE TO eTOYS INC.
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
EXHIBIT A
PRIOR INVESTORS
DynaFund International LP
DynaFund LP
Intel Corporation
idealab! Capital Partners I-A, LP
Highland Capital Partners III Limited Partnership
Highland Entrepreneurs' Fund III Limited Partnership
idealab! Capital Partners I-A, LP
idealab! Capital Partners I-B, LP
Bessemer Venture Partners IV L.P.
Bessemer Venture Investors X.X.
Xxxxxx Ventures IV L.P.
DynaFund International LP
DynaFund XX
Xxxxx Global Investments, Ltd.
Remington Investment Strategies, L.P.
Multi Strategies Fund, L.P.
Multi-Strategies Fund Ltd.
Sequoia Capital VIII
Sequoia International Technology Partners VIII
Sequoia International Technology Partners VIII Q
CMS
Sequoia 1997
Xxxxx X. Xxxxx
Xxxx X. Xxx Xxxxxx
VLG Investments 1998
EXHIBIT B
NEW INVESTORS
Highland Capital Partners IV Limited Partnership
Highland Entrepreneurs' Fund IV Limited Partnership
Sequoia Capital Franchise Fund
