EXHIBIT 10.18
FORM OF RESTRICTED STOCK PURCHASE AGREEMENT
(FOR PURCHASES PAID FOR WITH A PROMISSORY NOTE)
This Agreement is made and entered into as of ____________ (the "Effective
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Date") between AT HOME CORPORATION, a Delaware corporation (the "Company"), and
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__________ ("Purchaser").
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RECITALS
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A. The Company desires to provide equity incentives to certain key
employees pursuant to this Restricted Stock Purchase Agreement, which agreement
is intended to qualify as a compensatory benefit plan or agreement within the
meaning of Rule 701 under the Securities Act of 1933, as amended.
B. Purchaser possesses sufficient business and financial experience,
and/or sufficient knowledge of and/or relationship to the Company and its
management, as to enable the Company to lawfully issue shares of its Common
Stock to Purchaser without the need for registration or qualification of such
shares under the Securities Act of 1933, as amended, and all applicable state
"blue sky" laws.
C. The Company desires to sell to Purchaser, and Purchaser desires to
purchase from the Company, the shares of the Company's Series A Common Stock.
NOW, THEREFORE, the parties agree as follows:
1. PURCHASE OF SHARES. On the Effective Date and subject to the terms
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and conditions of this Agreement, Purchaser hereby purchases from the Company,
and Company hereby sells to Purchaser, an aggregate of ________ shares the
Company's Series A Common Stock, $0.01 par value (the "Shares") at an aggregate
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purchase price of $_________ (the "Purchase Price") or $0.10 per Share (the
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"Purchase Price Per Share"). As used in this Agreement, the term "Shares" refers
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to the Shares purchased under this Agreement and includes all securities
received (a) in replacement of the Shares, (b) as a result of stock dividends or
stock splits in respect of the Shares, and (c) in replacement of the Shares in a
recapitalization, merger, reorganization or the like.
2. PAYMENT OF PURCHASE PRICE; CLOSING.
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(A) DELIVERIES BY PURCHASER. Purchaser hereby delivers to the
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Company the full Purchase Price by delivery of: (i) a check in the amount of
$_________ in payment of the aggregate par value of the Shares, a copy of which
is attached hereto as Exhibit 1; and (ii) by delivery to the Company of a
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Secured Full Recourse Promissory Note of Purchaser in the principal amount of
$_________ in the form of Exhibit 2, duly executed by Purchaser (the "Note").
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Purchaser also hereby delivers to the Company: (i) two (2) copies of a blank
Stock Power and Assignment Separate from Stock Certificate in the form of
Exhibit 3 attached hereto (the "Stock Powers"), duly executed by Purchaser and
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(if applicable) Purchaser's spouse; and (ii) a Stock Pledge Agreement in the
form of Exhibit 4, duly executed by Purchaser (the "Pledge Agreement").
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(B) DELIVERIES BY THE COMPANY. Upon its receipt of the entire
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Purchase Price and all the documents to be executed and delivered by Purchaser
to the Company under Section 2(a), the Company will issue a duly executed stock
certificate evidencing the Shares in the name of Purchaser, with such
certificate to be placed in escrow as provided in Section 8 until expiration or
termination of both the Company's Repurchase Option and Right of First Refusal
described in Sections 5 and 6 and payment in full to the Company of all sums due
under the Note.
3. REPRESENTATIONS AND WARRANTS OF PURCHASER. Purchaser represents and
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warrants to the Company that:
(A) PURCHASE FOR OWN ACCOUNT FOR INVESTMENT. Purchaser is purchasing
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the Shares for Purchaser's own account for investment purposes only and not with
a view to, or for sale in connection with, a distribution of the Shares within
the meaning of the Securities Act of 1933, as amended (the "1933 Act").
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Purchaser has no present intention of selling or otherwise disposing of all or
any portion of the Shares and no one other than Purchaser has any beneficial
ownership of any of the Shares.
(B) ACCESS TO INFORMATION. Purchaser has had access to all
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information regarding the Company and its present and prospective business,
assets, liabilities and financial condition that Purchaser reasonably considers
important in making the decision to purchase the Shares, and Purchaser has had
ample opportunity to ask questions of the Company's representatives concerning
such matters and this investment.
(C) UNDERSTANDING OF RISKS. Purchaser is fully aware of: (i) the
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highly speculative nature of the investment in the Shares; (ii) the financial
hazards involved; (iii) the lack of liquidity of the Shares and the restrictions
on transferability of the Shares (e.g., that Purchaser may not be able to sell
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or dispose of the Shares or use them as collateral for loans); (iv) the
qualifications and backgrounds of the management of the Company; and (v) the tax
consequences of investment in the Shares.
(D) PURCHASER'S QUALIFICATIONS. Purchaser has a preexisting personal
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or business relationship with the Company and/or certain of its officers and/or
directors of a nature and duration sufficient to make Purchaser aware of the
character, business acumen and general business and financial circumstances of
the Company and/or such officers and directors. By reason of Purchaser's
business or financial experience, Purchaser is capable of evaluating the merits
and risks of this investment, has the ability to protect Purchaser's own
interests in this transaction and is financially capable of bearing a total loss
of this investment.
(E) NO GENERAL SOLICITATION. At no time was Purchaser presented with
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or solicited by any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection
with the offer, sale and purchase of the Shares.
(F) COMPLIANCE WITH SECURITIES LAWS. Purchaser understands and
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acknowledges that, in reliance upon the representations and warranties made by
Purchaser herein, the Shares are not being registered with the Securities and
Exchange Commission ("SEC") under the 1933 Act or being qualified under the
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California Corporate Securities Law of 1968, as amended (the "Law"), but instead
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are being issued under an exemption or exemptions from the registration and
qualification requirements of the 1933 Act and the Law or other applicable state
securities laws which may impose certain restrictions on Purchaser's ability to
transfer the Shares.
(G) RESTRICTIONS ON TRANSFER. Purchaser acknowledges and agrees that
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the Company, in its discretion, may elect to issue the Shares under one or more
of several different exemptions from the registration and qualification
requirements of the 1933 Act and the Law and that Purchaser's ability to
transfer the Shares in compliance with such laws will be affected by the
Company's choice of exemption. Purchaser further understands that the Company's
choice of exemptions may not be definitively made until a later date and the
Company is entirely free in its discretion to choose which exemption or
exemptions it will rely upon to exempt the sale of Shares to Purchaser.
Purchaser understands that Purchaser may not transfer any Shares unless such
Shares are registered under the 1933 Act or qualified under the Law or unless,
in the opinion of counsel to the Company, exemptions from such registration and
qualification requirements are available. Purchaser understands that only the
Company may file a registration statement with the SEC or the California
Commissioner of Corporations and that the Company is under no obligation to do
so with respect to the Shares. Purchaser has also
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been advised that exemptions from registration and qualification may not be
available or may not permit Purchaser to transfer all or any of the Shares in
the amounts or at the times proposed by Purchaser.
(H) RULE 144. Purchaser acknowledges that SEC Rule 144 promulgated
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under the 1933 Act, which permits certain limited sales of unregistered
securities, is not presently available with respect to the Shares and, in any
event, may require that the Shares be held for a minimum of two years, and in
certain cases three years, after they have been purchased and paid for (within
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the meaning of Rule 144), before they may be resold under Rule 144. PURCHASER
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UNDERSTANDS THAT SHARES PAID FOR WITH A NOTE MAY NOT BE DEEMED TO BE FULLY "PAID
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FOR" WITHIN THE MEANING OF RULE 144 UNLESS CERTAIN CONDITIONS ARE MET AND THAT,
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ACCORDINGLY, THE RULE 144 HOLDING PERIOD OF SUCH SHARES MAY NOT BEGIN TO RUN
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UNTIL SUCH SHARES ARE FULLY PAID FOR WITHIN THE MEANING OF RULE 144. Purchaser
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understands that Rule 144 will remain unavailable indefinitely with respect to
transfers of the Shares so long as Purchaser remains an "affiliate" of the
Company and "current public information" about the Company (as defined in Rule
144) is not publicly available. In addition, Purchaser understands that all
public resales of the Shares by Purchaser at a time when Purchaser is an
affiliate of the Company must comply with the provisions of Rule 144.
(I) RULE 701. If the Shares are issued pursuant to the exemption
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provided by Rule 701 promulgated under the 1933 Act, then the Shares will become
freely tradable by persons who are non-affiliates of the Company under SEC Rule
701 promulgated under the 1933 Act, subject to limited conditions regarding the
method of sale, 90 days after the first sale of common stock of the Company to
the general public pursuant to a registration statement filed with and declared
effective by the SEC, subject to any transfer restrictions imposed by applicable
state securities laws, the lengthier market standoff agreement contained in this
Agreement or any other agreement entered into by Purchaser. Under Rule 701,
affiliates must comply with the provisions (other than the holding period
requirements) of Rule 144.
(J) RULE 504. If the Company elects to issue the Shares to Purchaser
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under the exemption provided by Rule 504 of Regulation D promulgated under the
1933 Act, then the Shares should be freely tradable by non-affiliates of the
Company under the 1933 Act, subject to any transfer restrictions imposed by
applicable state securities laws, the lengthier market stand-off agreement
contained in this Agreement or any other contractual restrictions contained in
this Agreement or in any other agreement entered into by Purchaser. However,
affiliates of the Company must continue to comply with the provisions (other
than the holding period requirements) of Rule 144. As noted above, Rule 144 is
not presently available.
(K) TERMS OF PURCHASE AGREEMENT ACCEPTED. Purchaser has received a
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copy of this Agreement, has read and understands the terms of this Agreement,
and agrees to be bound by its terms and conditions. Purchaser acknowledges that
there may be adverse tax consequences upon purchase and disposition of the
Shares, and that Purchaser should consult a tax adviser prior to such purchase
or disposition.
4. MARKET STANDOFF AGREEMENT. Purchaser agrees in connection with any
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registration of the Company's securities under the 1933 Act that, upon the
request of the Company or the underwriters managing any registered public
offering of the Company's securities, Purchaser will not sell or otherwise
dispose of any Shares without the prior written consent of the Company or such
managing underwriters, as the case may be, for a period of time (not to exceed
one year) after the effective date of such registration requested by such
managing underwriters and subject to all restrictions as the Company or the
managing underwriters may specify for employee-shareholders generally.
5. COMPANY'S REPURCHASE OPTION. The Company has the option to repurchase
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all or a portion of the Unvested Shares (as defined below) on the terms and
conditions set forth in this Section (the "Repurchase Option") if Purchaser
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ceases to be employed by the Company (as defined
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herein) for any reason, or no reason, including without limitation Purchaser's
death, disability, voluntary resignation or termination by the Company with or
without cause.
(A) DEFINITION OF "EMPLOYED BY THE COMPANY"; "TERMINATION DATE". For
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purposes of this Agreement, Purchaser will be considered to be "employed by the
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Company" if the Board of Directors of the Company determines that Purchaser is
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rendering substantial services as an officer or employee to the Company or to
any parent, subsidiary or affiliate of the Company. In case of any dispute as
to whether Purchaser is employed by the Company, the Board of Directors of the
Company will have discretion to determine whether Purchaser has ceased to be
employed by the Company or any parent, subsidiary or affiliate of the Company
and the effective date on which Purchaser's employment terminated (the
"Termination Date").
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(B) UNVESTED AND VESTED SHARES. Shares that are not Vested Shares (as
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defined in this Section) are "Unvested Shares". On the Effective Date, all of
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the Shares will be Unvested Shares. If Purchaser has been continuously employed
by the Company at all times from the Effective Date ________ (the "First Vesting
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Date"), then on the First Vesting Date twenty-five percent (25%) of the Shares
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will become Vested Shares; and thereafter, for so long (and only for so long) as
Purchaser remains continuously employed by the Company at all times after the
First Vesting Date, an additional two point zero nine percent (2.09%) of the
Shares will become Vested Shares upon each succeeding month that elapses after
the First Vesting Date. Notwithstanding the foregoing, no Shares will become
Vested Shares after the Termination Date.
(C) ADJUSTMENTS. The number of Shares that are Vested Shares or
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Unvested Shares will be proportionally adjusted to reflect any stock dividend,
stock split, reverse stock split or recapitalization of the Series A Common
Stock of the Company occurring after the Effective Date.
(D) EXERCISE OF REPURCHASE OPTION AT ORIGINAL PRICE. At any time
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within ninety (90) days after the Termination Date, the Company may elect to
repurchase any or all of the Unvested Shares by giving Purchaser written notice
of exercise of the Repurchase Option. The Company and/or its assignee(s) will
then have the option to repurchase from Purchaser (or from Purchaser's personal
representative as the case may be) any or all of the Unvested Shares at the
Purchaser's original Purchase Price Per Share (as adjusted to reflect any stock
dividend, stock split, reverse stock split or recapitalization of the Series A
Common Stock of the Company occurring after the Effective Date).
(E) PAYMENT OF REPURCHASE PRICE. The repurchase price payable to
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purchase Unvested Shares upon exercise of the Repurchase Option will be payable,
at the option of the Company or its assignee(s), by check or by cancellation of
all or a portion of any outstanding indebtedness of Purchaser to the Company (or
to such assignee) or by any combination thereof. The repurchase price will be
paid without interest within ninety (90) days after the Termination Date.
(F) RIGHT OF TERMINATION UNAFFECTED. Nothing in this Agreement will
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be construed to limit or otherwise affect in any manner whatsoever the right or
power of the Company (or any parent, subsidiary or affiliate of the Company) to
terminate Purchaser's employment at any time for any reason or no reason, with
or without cause.
6. RIGHT OF FIRST REFUSAL. Unvested Shares may not be sold or otherwise
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transferred by Purchaser without the Company's prior written consent. Before
any Vested Shares held by Purchaser or any transferee of such Shares (either
being sometimes referred to herein as the "Holder") may be sold or otherwise
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transferred (including without limitation a transfer by gift or operation of
law), the Company and/or its assignee(s) will have a right of first refusal to
purchase the Vested Shares to be sold or transferred (the "Offered Shares") on
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the terms and conditions set forth in this Section (the "Right of First
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Refusal").
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(A) NOTICE OF PROPOSED TRANSFER. The Holder of the Shares will
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deliver to the Company a written notice (the "Notice") stating: (i) the Holder's
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bona fide intention to sell or otherwise transfer the Offered Shares; (ii) the
name, address and phone/fax number of each proposed purchaser or other
transferee ("Proposed Transferee"); (iii) the number of Offered Shares to be
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transferred to each Proposed Transferee; (iv) the bona fide cash price or other
consideration for which the Holder proposes to transfer the Offered Shares (the
"Offered Price") and (unless waived by the Company) a brief written explanation,
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signed by the Holder and the Proposed Transferee, of how the Offered Price was
arrived at; and (v) that the Holder will offer to sell the Offered Shares to the
Company and/or its assignee(s) at the Offered Price as provided in this Section.
A true and correct copy of the Proposed Transferee's bona fide offer shall be
provided to the Company together with the Notice.
(B) EXERCISE OF RIGHT OF FIRST REFUSAL. At any time within sixty
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(60) days after the date of the Notice, the Company and/or its assignee(s) may,
by giving written notice to the Holder, elect to purchase all (but not less than
all) of the Offered Shares proposed to be transferred to any one or more of the
Proposed Transferees named in the Notice, at the purchase price determined in
accordance with subsection (c) below.
(C) PURCHASE PRICE. The purchase price for the Offered Shares
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purchased under this Section will be the Offered Price. If the Offered Price
includes consideration other than cash, then the value of the non-cash
consideration as determined in good faith by the Company's Board of Directors
will conclusively be deemed to be the cash equivalent value of such non-cash
consideration.
(D) PAYMENT. Payment of the purchase price for Offered Shares will be
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payable, at the option of the Company and/or its assignee(s) (as applicable), by
check or by cancellation of all or a portion of any outstanding indebtedness of
the Holder to the Company (or to such assignee, in the case of a purchase of
Offered Shares by such assignee) or by any combination thereof. The purchase
price will be paid without interest within sixty (60) days after the Company's
receipt of the Notice, or, at the option of the Company and/or its assignee(s),
in the manner and at the time(s) set forth in the Notice.
(E) HOLDER'S RIGHT TO TRANSFER. If all of the Offered Shares
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proposed in the Notice to be transferred to a given Proposed Transferee are not
purchased by the Company and/or its assignee(s) as provided in this Section,
then the Holder may sell or otherwise transfer such Offered Shares to that
Proposed Transferee at the Offered Price or at a higher price, provided that
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such sale or other transfer is consummated within 120 days after the date of the
Notice, and provided further, that: (i) any such sale or other transfer is
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effected in compliance with all applicable securities laws; and (ii) the
Proposed Transferee agrees in writing that the provisions of this Section will
continue to apply to the Offered Shares in the hands of such Proposed
Transferee. If the Offered Shares described in the Notice are not transferred to
the Proposed Transferee within such 120 day period, then a new Notice must be
given to the Company, and the Company will again be offered the Right of First
Refusal before any Shares held by the Holder may be sold or otherwise
transferred.
(F) EXEMPT TRANSFERS. Notwithstanding anything to the contrary in
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this Section, the following transfers of Shares will be exempt from the Right of
First Refusal: (i) the transfer of any or all of the Shares during Purchaser's
lifetime by gift or on Purchaser's death by will or intestacy to Purchaser's
"immediate family" (as defined below) or to a trust for the benefit of Purchaser
or Purchaser's immediate family, provided that each transferee or other
recipient agrees in a writing satisfactory to the Company that the provisions of
this Section will continue to apply to the transferred Shares in the hands of
such transferee or other recipient; (ii) any transfer of Shares made pursuant to
a statutory merger or statutory consolidation of the Company with or into
another corporation or corporations (except that the Right of First Refusal will
continue to apply thereafter to such Shares, in which case the surviving
corporation of such merger or consolidation shall succeed to the rights or the
Company under this Section unless the agreement of merger or consolidation
expressly otherwise provides); (iii) any transfer of Shares pursuant to the
winding up and dissolution of the Company; or (iv) any transfer of Shares made
in accordance with
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Section 5 of this Agreement or this Section 6. As used herein, the term
"immediate family" will mean Purchaser's spouse, lineal descendant or
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antecedent, father, mother, brother or sister, adopted child or grandchild, or
the spouse of any child, adopted child, grandchild or adopted grandchild of
Purchaser.
(G) TERMINATION OF RIGHT OF FIRST REFUSAL. The Right of First
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Refusal will terminate as to all Shares on the effective date of the first sale
of common stock of the Company to the general public pursuant to a registration
statement filed with and declared effective by the SEC under the 1933 Act (other
than a registration statement relating solely to the issuance of common stock
pursuant to a business combination or an employee incentive or benefit plan).
(H) ENCUMBRANCES ON VESTED SHARES. Purchaser may xxxxx x xxxx or
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security interest in, or pledge, hypothecate or encumber Vested Shares only if
the Company or its successors and assigns do not hold a lien or security
interest in such share and only if each party to whom such lien or security
interest is granted, or to whom such pledge, hypothecation or other encumbrance
is made, agrees in a writing satisfactory to the Company that: (i) such lien,
security interest, pledge, hypothecation or encumbrance will not apply to such
Vested Shares after they are acquired by the Company and/or its assignees under
this Section; and (ii) the provisions of this Section will continue to apply to
such Vested Shares in the hands of such party and any transferee of such party.
Purchaser may not xxxxx x xxxx or security interest in, or pledge, hypothecate
or encumber any Unvested Shares.
7. RIGHTS AS SHAREHOLDER. Subject to the terms and conditions of this
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Agreement, Purchaser will have all of the rights of a shareholder of the Company
with respect to the Shares from and after the date that Purchaser delivers
payment of the Purchase Price until such time as Purchaser disposes of the
Shares or the Company and/or its assignee(s) exercise(s) the Repurchase Option
or Right of First Refusal. Upon an exercise of the Repurchase Option or the
Right of First Refusal, Purchaser will have no further rights as a holder of the
Shares so purchased upon such exercise, except the right to receive payment for
the Shares so purchased in accordance with the provisions of this Agreement, and
Purchaser will promptly surrender the stock certificate(s) evidencing the Shares
so purchased to the Company for transfer or cancellation.
8. ESCROW. As security for Purchaser's faithful performance of this
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Agreement, Purchaser agrees, immediately upon receipt of the stock
certificate(s) evidencing the Shares, to deliver such certificate(s), together
with the Stock Powers executed by Purchaser and by Purchaser's spouse, if any
(with the date and number of Shares left blank), to the Secretary of the Company
or other designee of the Company ("Escrow Holder"), who is hereby appointed to
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hold such certificate(s) and Stock Powers in escrow and to take all such actions
and to effectuate all such transfers and/or releases of such Shares as are in
accordance with the terms of this Agreement. Purchaser and the Company agree
that Escrow Holder will not be liable to any party to this Agreement (or to any
other party) for any actions or omissions unless Escrow Holder is grossly
negligent or intentionally fraudulent in carrying out the duties of Escrow
Holder under this Section. Escrow Holder may rely upon any letter, notice or
other document executed by any signature purported to be genuine and may rely on
the advice of counsel and obey any order of any court with respect to the
transactions contemplated by this Agreement. The Shares will be released from
escrow upon termination of both the Repurchase Option and the Right of First
Refusal provided, however, that the Shares will be retained in escrow so long as
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they are subject to the Pledge Agreement.
9. TAX CONSEQUENCES. Purchaser hereby acknowledges that Purchaser has
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been informed that, unless an election is filed by the Purchaser with the
Internal Revenue Service (and, if necessary, the proper state taxing
authorities), within 30 days of the purchase of the Shares, electing pursuant to
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Section 83(b) of the Internal Revenue Code (and similar state tax provisions, if
applicable) to be taxed currently on any difference between the Purchase Price
of the Shares and their fair market value on the date of purchase, there will be
a recognition of taxable income to the Purchaser, measured by the excess, if
any, of the fair market value of the Vested Shares, at the time they cease to be
Unvested Shares, over the purchase price for such Shares. Purchaser represents
that Purchaser has consulted
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any tax adviser(s) Purchaser deems advisable in connection with Purchaser's
purchase of the Shares and the filing of the election under Section 83(b) and
similar tax provisions. A form of Election under Section 83(b) is attached
hereto as Exhibit 5 for reference. PURCHASER HEREBY ASSUMES ALL RESPONSIBILITY
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FOR FILING SUCH ELECTION AND PAYING ANY TAXES RESULTING FROM SUCH ELECTION OR
FOR FAILING TO FILE THE ELECTION AND PAYING TAXES RESULTING FROM THE LAPSE OF
THE REPURCHASE RESTRICTIONS ON THE UNVESTED SHARES. PURCHASER UNDERSTANDS THAT
PURCHASER MAY SUFFER ADVERSE TAX CONSEQUENCES AS A RESULT OF PURCHASER'S
PURCHASE OR DISPOSITION OF THE SHARES. PURCHASER REPRESENTS THAT PURCHASER HAS
CONSULTED WITH ANY TAX ADVISER PURCHASER DEEMS ADVISABLE IN CONNECTION WITH THE
PURCHASE OR DISPOSITION OF THE SHARES AND THAT PURCHASER IS NOT RELYING ON THE
COMPANY FOR ANY TAX ADVICE.
10. RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.
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(A) LEGENDS. Purchaser understands and agrees that the Company will
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place the legends set forth below or similar legends on any stock certificate(s)
evidencing the Shares, together with any other legends that may be required by
state or federal securities laws, the Company's Certificate of Incorporation or
Bylaws, any other agreement between Purchaser and the Company or any agreement
between Purchaser and any third party:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED
OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY
PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.
A STATEMENT OF THE RIGHTS, PREFERENCES, PRIVILEGES AND RESTRICTIONS
GRANTED TO OR IMPOSED UPON EACH CLASS OR SERIES OF AUTHORIZED SHARES
OF THE COMPANY MAY BE OBTAINED UPON REQUEST AND WITHOUT CHARGE, FROM
THE COMPANY'S SECRETARY AT THE COMPANY'S PRINCIPAL OFFICES.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON PUBLIC RESALE AND TRANSFER, IRREVOCABLE PROXY AND
VOTING PROVISIONS, AND RIGHT OF FIRST REFUSAL AND REPURCHASE OPTIONS
HELD BY THE ISSUER AND/OR ITS ASSIGNEE(S) AS SET FORTH IN A RESTRICTED
STOCK PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF
THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE
OF THE ISSUER. SUCH PUBLIC RESALE AND TRANSFER RESTRICTIONS,
IRREVOCABLE PROXY AND VOTING PROVISIONS, AND THE RIGHT OF REPURCHASE
AND RIGHT OF FIRST REFUSAL OPTIONS ARE BINDING ON TRANSFEREES OF THESE
SHARES.
(B) STOP-TRANSFER INSTRUCTIONS. Purchaser agrees that, in order to
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ensure compliance with the restrictions imposed by this Agreement, the Company
may issue appropriate "stop-
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transfer" instructions to its transfer agent, if any, and if the Company
transfers its own securities, it may make appropriate notations to the same
effect in its own records.
(C) REFUSAL TO TRANSFER. The Company will not be required (i) to
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transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as owner
of such Shares, or to accord the right to vote or pay dividends, to any
purchaser or other transferee to whom such Shares have been so transferred.
11. COMPLIANCE WITH LAWS AND REGULATIONS. The issuance and transfer of
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the Shares will be subject to and conditioned upon compliance by the Company and
Purchaser with all applicable state and federal laws and regulations and with
all applicable requirements of any stock exchange or automated quotation system
on which the Company's common stock may be listed or quoted at the time of such
issuance or transfer.
12. SUCCESSORS AND ASSIGNS. The Company may assign any of its rights
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under this Agreement, including its rights to repurchase Shares under the
Repurchase Option and the Right of First Refusal. This Agreement will be
binding upon and inure to the benefit of the successors and assigns of the
Company. Subject to the restrictions on transfer herein set forth, this
Agreement will be binding upon Purchaser and Purchaser's heirs, executors,
administrators, successors and assigns.
13. GOVERNING LAW; SEVERABILITY. This Agreement will be governed by and
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construed in accordance with the internal laws of the State of California,
excluding that body of laws pertaining to conflict of laws. If any provision of
this Agreement is determined by a court of law to be illegal or unenforceable,
then such provision will be enforced to the maximum extent possible and the
other provisions will remain fully effective and enforceable.
14. NOTICES. Any notice required or permitted hereunder will be given in
--------
writing and will be deemed effectively given upon personal delivery, three (3)
days after deposit in the United States mail by certified or registered mail
(return receipt requested), one (1) business day after its deposit with any
return receipt express courier (prepaid), or one (1) business day after
transmission by facsimile, addressed to the other party at its address (or
facsimile number, in the case of transmission by facsimile) as shown below its
signature to this Agreement, or to such other address as such party may
designate in writing from time to time to the other party.
15. FURTHER INSTRUMENTS. The parties agree to execute such further
--------------------
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.
16. HEADINGS. The captions and headings of this Agreement are included
---------
for ease of reference only and will be disregarded in interpreting or construing
this Agreement. All references herein to Sections will refer to Sections of
this Agreement.
17. ENTIRE AGREEMENT. This Agreement, together with all its Exhibits,
-----------------
constitutes the entire agreement and understanding of the parties with respect
to the subject matter of this Agreement, and supersedes all prior understandings
and agreements, whether oral or written, between the parties hereto with respect
to the specific subject matter hereof.
18. FINANCIAL STATEMENTS. The Company shall provide fiscal year end
--------------------
financial statements to Purchaser on an annual basis at such times as they are
available for distribution to stockholders.
19. VOTING AGREEMENT. In consideration of the sale of the Shares by the
----------------
Company to Purchaser, Purchaser hereby agrees that, with respect to any matter
upon which the separate vote of the
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holders of the Company's Series A Common Stock is required under Section 242(b)
of the Delaware General Corporation Law prior to the closing of the Company's
initial public offering of Series A Common Stock pursuant to a registration
statement filed with and declared effective by the SEC (the "Company IPO"),
-----------
Purchaser will cast all votes attributable to Purchaser's Shares in the same
proportion as the holders of the Company's outstanding shares of Convertible
Preferred Stock designated in the Certificate of Incorporation of the Company
(the "Convertible Preferred Stock") cast their votes upon such matter, or, if
---------------------------
there are no such shares of Convertible Preferred Stock outstanding, in the same
manner as the holders of the Company's outstanding shares of Series B Common
Stock cast their votes upon such matter. Purchaser hereby irrevocably appoints
the Secretary of the Company, or any other person designated by the Secretary of
the Company, to act as Purchaser's proxy until the Company IPO to cast all votes
attributable to Purchaser's Shares as specified in this Section. The obligations
of this Section shall be binding on any transferee to whom the Shares are
transferred by Purchaser or any subsequent transferee. As a condition of any
transfer of the Shares prior to the Company IPO, Purchaser shall require any
transferee, and any such transferee shall require its transferee, to agree to be
bound by the provisions of this Section in the same manner as Purchaser is
bound.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
duplicate by its duly authorized representative and Purchaser has executed this
Agreement in duplicate, as of the Effective Date.
AT HOME CORPORATION PURCHASER
By:________________________________ ___________________________________
Title:_____________________________
Address: 000 Xxxxxxxxx Xxxxx Xxxxxxx:___________________________
Xxxxxxxx Xxxx, XX 00000
___________________________________
Fax: ______________________________
LIST OF EXHIBITS
----------------
Exhibit 1: Purchaser's check in the amount of $________ in payment of the
aggregate par value of the Shares
Exhibit 2: Secured Full Recourse Promissory Note
Exhibit 3: Stock Power and Assignment Separate from Stock Certificate
Exhibit 4: Stock Pledge Agreement
Exhibit 5: Election Under Section 83(b) of the Internal Revenue Code
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EXHIBIT 1
---------
COPY OF PURCHASER'S CHECK
-------------------------
EXHIBIT 2
---------
SECURED FULL RECOURSE PROMISSORY NOTE
-------------------------------------
Mountain View, California
$__________ July 16, 1996
1. OBLIGATION. In exchange for the issuance to the undersigned
-----------
("Purchaser") of ________ shares (the "Shares") of the Series A Common Stock of
--------- ------
AT HOME CORPORATION, a Delaware corporation (the "Company"), receipt of which is
-------
hereby acknowledged, Purchaser hereby promises to pay to the order of the
Company on or before May 31, 2001, at the Company's principal place of business
at 000 Xxxxxxxxx Xxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000, or at such other place
as the Company may direct, the principal sum of ________________ Dollars
($________) together with interest on unpaid principal compounded annually at
the rate of Five point Eight Eight percent (5.88%), which rate is not less than
the minimum rate established pursuant to Section 1274(d) of the Internal Revenue
Code of 1986, as amended, on the earliest date on which there was a binding
contract in writing for the purchase of the Shares; provided, however, that the
-------- -------
rate at which interest will accrue on unpaid principal under this Note will not
exceed the highest rate permitted by applicable law.
2. SECURITY. Payment of this Note is secured by a security interest in
---------
the Shares granted to the Company by Purchaser under a Stock Pledge Agreement
dated of even date herewith between the Company and Purchaser (the "Pledge
------
Agreement"). This Note is being tendered by Purchaser to the Company in partial
---------
payment of the purchase price of the Shares pursuant to that certain Restricted
Stock Purchase Agreement between Purchaser and the Company dated of even date
with this Note (the "Purchase Agreement").
------------------
3. DEFAULT; ACCELERATION OF OBLIGATION. Purchaser will be deemed to be
------------------------------------
in default under this Note and the principal sum of this Note, together with all
interest accrued thereon, will immediately become due and payable in full: (a)
upon Purchaser's failure to make any payment when due under this Note; (b) in
the event Purchaser ceases to be employed by the Company (as defined in the
Purchase Agreement) for any reason; (c) upon any transfer of any of the Shares;
(d) upon the filing by or against Purchaser of any voluntary or involuntary
petition in bankruptcy or any petition for relief under the federal bankruptcy
code or any other state or federal law for the relief of debtors; or (e) upon
the execution by Purchaser of an assignment for the benefit of creditors or the
appointment of a receiver, custodian, trustee or similar party to take
possession of Purchaser's assets or property.
4. REMEDIES ON DEFAULT. Upon any default of Purchaser under this Note,
--------------------
the Company will have, in addition to its rights and remedies under this Note
and under the Pledge Agreement, full recourse against any real, personal,
tangible or intangible assets of Purchaser, and may pursue any legal or
equitable remedies that are available to it.
5. RULE 144 HOLDING PERIOD. SUBJECT (TO THE EXTENT RULE 701 IS
------------------------
APPLICABLE TO THE SHARES) TO ANY CONTRARY PROVISIONS OF RULE 701 UNDER THE
SECURITIES ACT OF 1933, PURCHASER UNDERSTANDS THAT THE HOLDING PERIOD SPECIFIED
UNDER RULE 144(d) OF THE SECURITIES AND EXCHANGE COMMISSION WILL NOT BEGIN TO
RUN WITH RESPECT TO SHARES PURCHASED WITH THIS NOTE UNTIL EITHER (A) THE
PURCHASE PRICE OF SUCH SHARES IS PAID IN FULL IN CASH OR BY OTHER PROPERTY
ACCEPTED BY THE COMPANY, OR (B) THIS NOTE IS SECURED BY COLLATERAL, OTHER THAN
THE SHARES THAT HAVE NOT BEEN
FULLY PAID FOR IN CASH, HAVING A FAIR MARKET VALUE AT LEAST EQUAL TO THE AMOUNT
OF PURCHASER'S THEN OUTSTANDING OBLIGATION UNDER THIS NOTE (INCLUDING ACCRUED
INTEREST).
6. PREPAYMENT. Prepayment of principal and/or interest due under this
-----------
Note may be made at any time without penalty. Unless otherwise agreed in
writing by the Company, all payments will be made in lawful tender of the United
States and will be applied first to the payment of accrued interest, and the
remaining balance of such payment, if any, will then be applied to the payment
of principal. If Purchaser prepays all or a portion of the principal amount of
this Note, Purchaser intends that the Shares paid for by the portion of
principal so paid will continue to be held in pledge under the Pledge Agreement
to serve as independent collateral for the outstanding portion of this Note for
the purpose of commencing the holding period under Rule 144(d) of the Securities
and Exchange Commission with respect to other Shares purchased with this Note.
7. GOVERNING LAW; WAIVER. The validity, construction and performance of
----------------------
this Note will be governed by the internal laws of the State of California,
excluding that body of law pertaining to conflicts of law. Purchaser hereby
waives presentment, notice of non-payment, notice of dishonor, protest, demand
and diligence.
8. ATTORNEYS' FEES. If suit is brought for collection of this Note,
----------------
Purchaser agrees to pay all reasonable expenses, including attorneys' fees,
incurred by the holder in connection therewith whether or not such suit is
prosecuted to judgment.
IN WITNESS WHEREOF, Purchaser has executed this Note as of the date and
year first above written.
__________________________
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EXHIBIT 3
---------
STOCK POWER AND ASSIGNMENT
SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED and pursuant to that certain Restricted Stock Purchase
Agreement dated as of July 16, 1996, (the "Agreement"), the undersigned hereby
---------
sells, assigns and transfers unto _____________________, ______________ shares
of the Series A Common Stock of AT HOME CORPORATION, a Delaware corporation (the
"Company"), standing in the undersigned's name on the books of the Company
-------
represented by Certificate No(s). _____ delivered herewith, and does hereby
irrevocably constitute and appoint the Secretary of the Company as the
undersigned's attorney-in-fact, with full power of substitution, to transfer
said stock on the books of the Company. THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT AND THE EXHIBITS THERETO.
Dated: _____________________, 199___
PURCHASER
______________________________
______________________________
(Purchaser's Spouse)
INSTRUCTION: Please do not fill in any blanks other than the signature line.
----------- ---
The purpose of this Stock Power and Assignment is to enable the Company and/or
its assigns to acquire the shares upon a default under Purchaser's Note and to
exercise its "Repurchase Option" and/or "Right of First Refusal" set forth in
the Agreement without requiring additional signatures on the part of the
Purchaser.
EXHIBIT 4
---------
STOCK PLEDGE AGREEMENT
----------------------
This Agreement is made and entered into as of ________ between AT HOME
CORPORATION, a Delaware corporation (the "Company"), and ____________
-------
("Pledgor").
-------
R E C I T A L S
- - - - - - - -
A. In exchange for Pledgor's Secured Full Recourse Promissory Note to the
Company of even date herewith (the "Note") and a cash payment of ____________
----
Dollars ($________), the Company has issued and sold to Pledgor ________ shares
of its Series A Common Stock (the "Shares") pursuant to the terms and conditions
------
of that certain Stock Purchase Agreement between the Company and Pledgor dated
of even date herewith (the "Purchase Agreement").
------------------
B. Pledgor has agreed that repayment of the Note will be secured by the
pledge of the Shares pursuant to this Agreement.
NOW, THEREFORE, the parties agree as follows:
1. CREATION OF SECURITY INTEREST. Pursuant to the provisions of the
------------------------------
California Commercial Code, Pledgor hereby grants to the Company, and the
Company hereby accepts, a first and present security interest in the Shares as
collateral to secure the payment of Pledgor's obligation to the Company under
the Note. Pledgor herewith delivers to the Company Series A Common Stock
certificate(s) No(s). ____representing all the Shares, together with one stock
power for each certificate in the form attached as an Exhibit to the Purchase
Agreement, duly executed (with the date and number of shares left blank) by
Pledgor and Pledgor's spouse, if any. For purposes of this Agreement, the
Shares pledged to the Company hereby, together with any additional collateral
pledged pursuant to Section 5 hereof, will hereinafter be collectively referred
to as the "Collateral." Pledgor agrees that the Collateral pledged to the
----------
Company will be deposited with and held by the Escrow Holder (as defined in the
Purchase Agreement) and that, notwithstanding anything to the contrary in the
Purchase Agreement, for purposes of carrying out the provisions of this
Agreement, Escrow Holder will act solely for the Company as its agent.
2. REPRESENTATIONS AND WARRANTIES. Pledgor hereby represents and
-------------------------------
warrants to the Company that Pledgor has good title (both record and beneficial)
to the Collateral, free and clear of all claims, pledges, security interests,
liens or encumbrances of every nature whatsoever, and that Pledgor has the right
to pledge and grant the Company the security interest in the Collateral granted
under this Agreement. Pledgor further agrees that, until the entire principal
sum and all accrued interest due under the Note has been paid in full, Purchaser
will not, without the Company's prior written consent, (i) sell, assign or
transfer, or attempt to sell, assign or transfer, any of the Collateral, or (ii)
grant or create, or attempt to grant or create, any security interest, lien,
pledge, claim or other encumbrance with respect to any of the Collateral.
3. RIGHTS ON DEFAULT. In the event of default (as defined in the Note)
------------------
by Pledgor under the Note, the Company will have full power to sell, assign and
deliver the whole or any part of the Collateral at any broker's exchange or
elsewhere, at public or private sale, at the option of the Company, in order to
satisfy any part of the obligations of Pledgor now existing or hereinafter
arising under the Note. On any such sale, the Company or its assigns may
purchase all or any part of the Collateral. In addition, at its sole option, the
Company may elect to retain all the Collateral in full satisfaction of Pledgor's
obligation under the Note, in accordance with the provisions and procedures set
forth in the California Commercial Code.
4. ADDITIONAL REMEDIES. The rights and remedies granted to the Company
--------------------
herein upon default under the Note will be in addition to all the rights, powers
and remedies of the Company as a secured creditor or otherwise under the
California Commercial Code and applicable law and such rights, powers and
remedies will be exercisable by the Company with respect to all of the
Collateral. Pledgor agrees that the Company's reasonable expenses of holding
the Collateral, preparing it for resale or other disposition, and selling or
otherwise disposing of the Collateral, including attorneys' fees and other legal
expenses, will be deducted from the proceeds of any sale or other disposition
and will be included in the amounts Pledgor must tender to redeem the
Collateral. All rights, powers and remedies of the Company will be cumulative
and not alternative. Any forbearance or failure or delay by the Company in
exercising any right, power or remedy hereunder will not be deemed to be a
waiver of any such right, power or remedy and any single or partial exercise of
any such right, power or remedy hereunder will not preclude the further exercise
thereof.
5. DIVIDENDS; VOTING. All dividends hereinafter declared on or payable
------------------
with respect to the Collateral during the term of this pledge (excluding only
ordinary cash dividends, which will be payable to Pledgor so long as Pledgor is
not in default under the Note) will be immediately delivered to the Company to
be held in pledge under this Agreement. Notwithstanding this Agreement, so long
as Pledgor owns the Shares and is not in default under the Note, Pledgor will be
entitled to vote any shares comprising the Collateral, subject to any the proxy
granted by Pledgor and subject to the voting provisions of the Purchase
Agreement.
6. ADJUSTMENTS. In the event that during the term of this pledge, any
------------
stock dividend, reclassification, readjustment, stock split or other change is
declared or made with respect to the Collateral, or if warrants or any other
rights, options or securities are issued in respect of the Collateral, then all
new, substituted and/or additional shares or other securities issued by reason
of such change or by reason of the exercise of such warrants, rights, options or
securities, will be immediately pledged to the Company to be held under the
terms of this Agreement in the same manner as the Collateral is held hereunder.
7. RIGHTS UNDER PURCHASE AGREEMENT. Pledgor understands and agrees that
--------------------------------
the Company's rights to repurchase the Collateral under the Purchase Agreement
will continue for the periods and on the terms and conditions specified in the
Purchase Agreement, whether or not the Note has been paid during such period of
time, and that to the extent that the Note is not paid during such period of
time, the repurchase by the Company of the Collateral may be made by way of
cancellation of all or any part of Pledgor's indebtedness under the Note.
8. REDELIVERY OF COLLATERAL. Upon payment in full of the entire
-------------------------
principal sum and all accrued interest due under the Note, and subject to the
terms and conditions of the Purchase Agreement, the Company will immediately
redeliver the Collateral to Pledgor and this Agreement will terminate; provided,
--------
however, that all rights of the Company to retain possession of the Shares
-------
pursuant to the Purchase Agreement will survive termination of this Agreement.
9. SUCCESSORS AND ASSIGNS. This Agreement will inure to the benefit of
-----------------------
the respective heirs, personal representatives, successors and assigns of the
parties hereto.
10. GOVERNING LAW; SEVERABILITY. This Agreement will be governed by and
----------------------------
construed in accordance with the internal laws of the State of California,
excluding that body of law relating to conflicts of law. Should one or more of
the provisions of this Agreement be determined by a court of law to be illegal
or unenforceable, the other provisions nevertheless will remain effective and
will be enforceable.
11. MODIFICATION; ENTIRE AGREEMENT. This Agreement will not be amended
-------------------------------
without the written consent of both parties hereto. This Agreement and Section
8 of the Purchase Agreement constitute the
-2-
entire agreement of the parties hereto with respect to the subject matter hereof
and supersede all prior agreements and understandings related to such subject
matter.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.
AT HOME CORPORATION PLEDGOR
By:_____________________________ ______________________________
Title___________________________
-3-
EXHIBIT 5
---------
ELECTION UNDER SECTION 83(B) OF THE
INTERNAL REVENUE CODE
The undersigned Taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code, to include in gross income for the Taxpayer's current
taxable year the excess, if any, of the fair market value of the property
described below at the time of transfer over the amount paid for such property,
as compensation for services.
1. TAXPAYER'S NAME: _________________________
TAXPAYER'S ADDRESS: _________________________
_________________________
SOCIAL SECURITY NUMBER: _________________________
2. The property with respect to which the election is made is described as
follows: _________ shares of Series A Common Stock of AT HOME CORPORATION,
a Delaware corporation (the "Company"), which is Taxpayer's employer or the
-------
corporation for whom the Taxpayer performs services.
3. The date on which the shares were transferred was _______ and this election
is made for calendar year 1996.
4. The shares are subject to the following restrictions: The Company may
repurchase all or a portion of the shares at the Taxpayer's original
purchase price under certain conditions at the time of Taxpayer's
termination of employment or services.
5. The fair market value of the shares (without regard to restrictions other
than restrictions which by their terms will never lapse) was $0.10 per
share at the time of transfer.
6. The amount paid for such shares was $0.10 per share.
7. The Taxpayer has submitted a copy of this statement to the Company.
THIS ELECTION MUST BE FILED WITH THE INTERNAL REVENUE SERVICE ("IRS"), AT THE
---
OFFICE WHERE THE TAXPAYER FILES ANNUAL INCOME TAX RETURNS, WITHIN 30 DAYS AFTER
--------------
THE DATE OF TRANSFER OF THE PROPERTY, AND MUST ALSO BE FILED WITH THE TAXPAYER'S
INCOME TAX RETURNS FOR THE CALENDAR YEAR. THE ELECTION CANNOT BE REVOKED
WITHOUT THE CONSENT OF THE IRS.
Dated: ______________________________
