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EXHIBIT 4.3
FORM OF
AMENDMENT NO. 2
TO SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
This Amendment No. 2 dated April ___, 1999 (the "Rights Agreement
Amendment") to Second Amended and Restated Investors Rights Agreement dated
February 27, 1998 (the "Rights Agreement"), is entered into by and among Launch
Media, Inc., a Delaware corporation (the "Company"), the undersigned holders of
Series A, Series B, Series C and Series D Stock of the Company (the "Prior
Investors"), Xxxxx & Company Incorporated as a holder of a warrant to purchase
the Company's Common Stock and SW Networks Inc. as a new investor of Common
Stock (hereinafter the "New Investor"). Capitalized terms used herein and not
otherwise defined herein shall have the same meanings as in the Rights
Agreement.
RECITALS
A. The Company, the Prior Investors and Xxxxx & Company Incorporated
have previously entered into the Rights Agreement.
B. The Company has entered into a Note Purchase Agreement with
certain Prior Investors providing for the issuance of Common Stock or Series D
Stock (the "Conversion Securities") upon conversion of certain promissory notes
(the "Bridge Notes") issued by the Company and such Investors desire to have
such Conversion Securities to be included as Registrable Securities under this
Agreement.
C. Concurrent herewith, the Company and New Investors are entering
into a Stock Purchase Agreement (the "Stock Purchase Agreement"), providing,
among other things, for the issuance of shares of Common Stock of the Company to
the New Investor.
D. The Board of Directors of the Company has determined that it is
in the best interests of the Company to amend the Rights Agreement in the form
hereof.
E. It is intended that by its signature hereto the New Investor
shall become a party to the Rights Agreement, as amended by this Agreement,
effective as of the date upon which it acquires shares of Common Stock and be
included in the definition of "Investors" as that term is defined in the Rights
Agreement.
NOW, THEREFORE, IT IS AGREED between the parties as follows:
1. Amendments.
(a) The following definitions contained in Section 1 of the Rights Agreement are
amended to read in full as follows:
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"Conversion Stock" shall mean the shares of Common Stock
issued or issuable upon conversion of the Series A Stock issued pursuant to the
Series A Agreement, upon conversion of the Series B Stock issued pursuant to the
Series B Agreement, upon conversion of the Series C stock issued pursuant to the
Series C Agreement, upon conversion of the Series D Stock issued pursuant to the
Series D Agreement, the shares of Common Stock issuable upon exercise of a
warrant to purchase Common Stock issued to Xxxxx & Company Incorporated pursuant
to a Warrant Agreement by and between the Company and Xxxxx & Company
Incorporated dated September 8, 1997, the shares of Common Stock issuable upon
exercise of such Series D stock as issuable upon exercise of any NBC Warrant and
the shares of Common Stock issuable upon exercise of such Series D Stock as
issuable upon exercise of the GE Capital Warrant, and the shares of Common Stock
issuable upon conversion of the Bridge Notes or upon conversion of shares of
Series D Stock issued upon conversion of the Bridge Notes."
"Registrable Securities" means (i) the Conversion Stock,
(ii) shares of Common Stock (the "New Investor Shares") issued to the New
Investor pursuant to Section 2.2 of the Stock Purchase Agreement and (iii) any
Common Stock of the Company issued or issuable with respect to, or in exchange
for or in replacement of the securities referred to in clauses (i) and (ii)
above or other securities convertible into or exercisable for such securities
upon any stock split, stock dividend, recapitalization, merger, consolidation or
similar event, provided, however, that shares of Common Stock or other
securities convertible into or exercisable for such securities shall only be
treated as Registrable Securities for the purposes of Sections 2.5, 2.6 or 2.7
hereof if and so long as they have not been sold to or through a broker or
dealer or underwriter in a public distribution or a public securities
transaction."
(b) The first paragraph of Section 2.5(a) is amended to read as
follows:
"2.5 Requested Registration.
"(a) Request for Registration. In case the Company
shall receive from (i) Initiating Holders a written request that the Company
effect any registration, qualification or compliance with respect to (x) shares
representing 30% or more of the Registrable Securities or (y) shares of
Registrable Securities with an expected aggregate offering price to the public
of at least $5,000,000 or (ii) the New Investor a written request that the
Company effect any registration, qualification or compliance with respect to New
Investor Shares provided such request may not be made prior to April ___, 2000
(unless the Offering Price to the public in the Company's initial public
offering is $20.00 or greater per share in which case such request may not be
made prior to September __, 1999) , the Company will:"
(c) Section 2.5 (a)(ii)(D) is amended in full to read as follows:
"(D) After the Company has effected three such
registrations pursuant to this Section 2.5(a) covering all shares requested to
be registered by the Holders initiating or joining such request, and such
registrations have been declared or ordered effective, and, if the method of
disposition specified by such initiating or requesting Holders shall have been a
firm commitment underwritten public offering, all such shares shall have been
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sold pursuant thereto, provided that one such registration shall be exclusively
the right of the New Investor to request."
(d) The second paragraph of 2.5(b) shall be amended to read in full
as follows:
"The Company shall (together with all Holders proposing to distribute their
securities through such underwriting) enter into an underwriting agreement in
customary form with the managing underwriter of recognized national standing
selected for such underwriting by the Company and reasonably acceptable to a
majority of the Holders proposing to distribute their securities through such
underwriting. Notwithstanding any other provision of this Section 2.5, if the
managing underwriter in its good faith judgment 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 and the number of shares of Registrable Securities that may be
included in the registration and underwriting shall be allocated among all
Holders thereof in proportion, as nearly as practicable, to the respective
amounts of Registrable Securities requested by such Holders to be included in
such registration statement or in such other manner as shall be agreed to by the
Company and Holders of a majority of the Registrable Securities proposed to be
included in such registration; provided that if such registration has been
requested by the New Investor, the Registrable Securities held by any Holders
other than the New Investors shall be excluded prior to any securities held by
the New Investor. No Registrable Securities excluded from the underwriting by
reason of the underwriter's marketing limitation shall be included in such
registration. To facilitate the allocation of shares in accordance with the
above provisions, the Company or the underwriters may round the number of shares
allocated to any Holder to the nearest 100 shares."
(e) Section 8.1 is amended in full to read as follows:
"8.1 Waivers and Amendments. The obligations of the Company
and the rights of the Investors, and the New Investor and holders of Shares,
Conversion Stock and New Investor Shares under this Agreement may be waived
(either generally or in a particular instance, either retroactively or
prospectively and either for a specified period of time or indefinitely) only
with the written consent of the Company and the Investors holding more than
eighty percent (80%) of the Shares, Conversion Stock and New Investor Shares,
and with the same consent the Company, when authorized by resolution of its
Board of Directors, may enter into a supplementary agreement for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement; provided, however, that no such waiver or
supplemental agreement shall reduce the aforesaid percentage of Shares,
Conversion Stock and New Investor Shares, the Investors holding which are
required to consent to any waiver or supplemental agreement without the consent
of the record holders of all of the Shares, Conversion Stock and New Investor
Shares and no such waiver or supplemental agreement shall adversely affect any
Series of Series A, Series B, Series C, Series D Stock or New Investor Shares in
a manner different than any other Series of such stock or New Investor Shares
without the approval of eight percent (80%) of the holders of the outstanding
voting shares of such series or the New Investor; provided, further, that no
such waiver or supplemental agreement shall adversely affect the rights of any
NBC Warrant, the GE Capital Warrant, the Series D Stock
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issuable upon exercise of any NBC Warrant, the Series D Stock issuable upon
exercise of the GE Capital Warrant, or any shares of Series D Stock issued
pursuant to the Series D Agreement in a manner different from any other holder
of Series D Stock without the prior written consent of the holder of such NBC
Warrant, GE Capital Warrant or Series D Stock. Notwithstanding the foregoing, no
such supplemental agreement, amendment, waiver or other instrument effected in
accordance with this Section 8.1 shall increase the obligations of any Investor
or holder of Shares or Conversion Stock or the New Investor unless such Investor
or holder or the New Investor shall have consented thereto in writing. Upon the
effectuation of each such waiver, consent, agreement, amendment or modification
the Company shall promptly give written notice thereof to the record holders of
the New Investor Shares, Shares and Conversion Stock who have not previously
consented thereto in writing. Neither this Agreement nor any provisions hereof
may be changed, waived, discharged or terminated orally, but only by a signed
statement in writing. In addition, notwithstanding this Section 8.1, there shall
be no change to any provision of this Agreement which grants rights or benefits
to a particular Investor or the New Investor without the prior written consent
of such Investor or the New Investor, as applicable."
2. Miscellaneous.
a. Effect on Rights Agreement. Except as amended hereby, the Rights
Agreement shall remain in full force and effect.
b. Separability. In case any provision of this Amendment shall be
declared invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
c. Titles and Subtitles. The titles of the paragraphs and
subparagraphs of this Amendment are for convenience of reference only and are
not to be considered in construing this Amendment.
d. Termination. This Amendment shall be terminated and be of no
further force and effect upon the termination of the Rights Agreement.
e. Governing Law. All questions concerning the construction,
validity and interpretation of this Amendment, and the performance of the
obligations imposed by this Amendment, shall be governed by the laws of the
State of California applicable to contracts made and wholly to be performed in
that state.
f. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
g. Signature. By its signature hereto, the New Investor becomes a
party to the Rights Agreement, as amended by this Agreement, and are included
for all purposes in the definition of Investors as that term is defined in the
Rights Agreement.
h. Waiver of Right of First Refusal. Each Prior Investor hereby
waives its
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right to notice and right of first refusal granted under the Section 3.1 of the
Rights Agreement, solely with respect to the sale and issuance of the New
Investor Shares.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date referenced above.
"COMPANY"
LAUNCH MEDIA, INC.
By:
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Name: Xxxxxx X. Xxxxxx
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Title: President
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
THE PHOENIX PARTNERS II LIQUIDATING TRUST
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
THE PHOENIX PARTNERS III LIQUIDATING TRUST
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
THE PHOENIX PARTNERS IIIB LIMITED PARTNERSHIP
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
THE PHOENIX PARTNERS IV LIMITED PARTNERSHIP
By:
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Signature:
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Title:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
INTEL CORPORATION
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
XXX ENTERTAINMENT L.L.C.
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
SOFTBANK VENTURES, INC.
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
ISLAND TRADING CO., INC.
By:
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Signature:
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Title:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
GENERAL ELECTRIC CAPITAL CORPORATION
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
NBC MULTIMEDIA, INC.
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
AVALON TECHNOLOGY LLC
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
XXXXX & COMPANY INCORPORATED
By:
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Signature:
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Title:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
DIGITAL VENTURES LIMITED
By:
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Signature:
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Title:
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"PRIOR INVESTOR"
GORAN ENTERPRISES LIMITED
By:
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Signature:
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Title:
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"NEW INVESTOR"
SW NETWORKS INC.
By:
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Signature:
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Title:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
J & B VENTURE PARTNERS I
By:
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Signature:
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Title:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
XXXXXXX XXXXXXXXX
Printed Name:
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Signature:
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"PRIOR INVESTOR"
XXXX XXXXXXXXX
Printed Name:
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Signature:
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"PRIOR INVESTOR"
XXXXXX XXXXXXXXX
Printed Name:
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Signature:
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COUNTERPART SIGNATURE PAGE TO
LAUNCH MEDIA, INC. AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED INVESTORS RIGHTS AGREEMENT
DATED AS OF APRIL ___, 1999
"PRIOR INVESTOR"
XXXXXX X. XXXX
Printed Name:
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Signature:
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