Exhibit 10.6
AMENDMENT NO. 1 TO STOCKHOLDER AND REGISTRATION RIGHTS
AGREEMENT
THIS AMENDMENT NO. 1 (this "AMENDMENT NO. 1"), dated as of April 12,
2006, is made by and among SoftWave Media Exchange, Inc. (formerly Soft Wave
Media, Inc.) (the "COMPANY") and each of the holders of the Company's common
stock (collectively, the "STOCKHOLDERS"), to that certain Stockholder and
Registration Rights Agreement dated as of January 19, 2006 by and among the
Company and the Stockholders (the "AGREEMENT"). Capitalized terms used in this
Amendment No. 1 but not otherwise defined shall have the meanings ascribed to
them in the Agreement.
RECITALS:
A. The Company and the Stockholders have heretofore executed and
delivered the Agreement.
B. Pursuant to Section 16 of the Agreement, subject to certain
limited exceptions, no change, modification or amendment of the Agreement shall
be valid unless the same shall be in writing and signed by all of the parties to
the Agreement.
C. The Company and the Stockholders now wish to amend the
Agreement.
NOW THEREFORE, in consideration of the foregoing the Agreement is
hereby amended as follows:
1. The definition of "Permitted Transferee" in Section 1 of the
Agreement is hereby amended by striking the definition in its entirety and
substituting the following in place thereof:
"PERMITTED TRANSFEREE" means (i) in the case of a Founding Stockholder
(or any direct or indirect Permitted Transferee of a Founding Stockholder), one
or more of the following persons or entities: Soft Wave Media, LLC, Alowex, LLC,
Remnant Media, LLC, Xxxx Xxxxxx, Xxxxxxx Xxxxxxx, Xxxxxxx Xxxxxx, Xxxxxxx
Xxxxxxxxx, Xxx Xxxx or Xxxxx Xxxxxxxx, (ii) in the case of an Investor, any
entity in which Xxxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx and/or such Investor,
singularly or collectively, owns at least 51% of the outstanding voting
securities and (iii) any recipient of shares of common stock acquired by gift;
PROVIDED, HOWEVER, that no person or entity shall be deemed to be a Permitted
Transferee unless such person or entity, in connection with the purported
Permitted Transfer to such person or entity, shall execute a counterpart to this
Agreement, in form and substance reasonably satisfactory to the Board of
Directors of the Corporation, pursuant to which such person or entity agrees to
be bound by all of the terms and provisions of this Agreement.
2. Section 4 of the Agreement is hereby amended by striking the
section in its entirety and substituting the following in place thereof:
4. BOARD OF DIRECTORS AND OFFICERS. During the term of this
Agreement (as set forth in Section 13), each Stockholder shall vote his Shares
and otherwise act so as to cause the Board of Directors of the Corporation (the
"BOARD") to be comprised of up to nine persons, constituted as follows: (i) a
majority of persons who are independent from the Company, as independence is
defined in Rule 4200(a)(15) of the NASD listing standards or such other listing
standards as are then applicable to the Company; and (ii) one less than a
majority of persons nominated by Soft Wave Media, LLC.
3. Section 5(c) of the Agreement is hereby amended by striking
the section in its entirety and substituting the following in place thereof:
(c) Notwithstanding anything else set forth in paragraph (a) of
this Section 5, the Corporation may, at the discretion of a vote by not less
than eighty percent (80%) of its Board of Directors and without the consent of
any requesting Registrable Holder, withdraw any registration and abandon the
proposed offering. Furthermore, if the managing underwriter of an underwritten
offering advises the Corporation that in its opinion either because of (i) the
size of the offering that the Corporation and any Registrable Holders desire to
make or (ii) the kind of securities that the Corporation and any Registrable
Holders intend to include in such offering, the success of the offering could be
materially and adversely affected by inclusion of the Registrable Shares
requested to be included, then (A) in the event that the size of the offering is
the basis of such managing underwriter's opinion, the amount of Registrable
Shares to be offered for the account of Registrable Holders shall be reduced on
a pro rata basis among such Registrable Holders (on the basis of the amount of
Registrable Shares intended to be included in such registration by each such
Registrable Holder as compared to the aggregate amount of Registrable Shares
intended to be included by all such Registrable Holders) to the extent necessary
to reduce the total amount of Registrable Shares to be included in such offering
to the amount recommended by such managing underwriter; and (B) in the event
that the kind or combination of securities to be offered is the basis of such
managing underwriter's opinion, the amount of Registrable Shares to be included
in such offering shall be reduced as described in clause (A) above or, if any
such reduction would, in the judgment of the managing underwriter, be
insufficient to substantially eliminate the adverse effect that inclusion of the
Registrable Shares requested to be included could have on such offering, such
Registrable Shares shall be excluded from such underwritten offering.
Notwithstanding the exclusion of such Registrable Shares from such underwritten
offering, the Corporation will cause such Registrable Shares to be registered
for resale in the same registration statement, provided upon the reasonable
request of the managing underwriter that the requesting Registrable Holders
agree not to consummate any such resale of their Registrable Shares pursuant to
such registration statement for a period of up to 180 days after such
registration statement is declared effective under the Securities Act. The
Corporation agrees to maintain the effectiveness of such registration statement
under the Securities Act for up to 12 months after such lock-up period has
expired or until all such registered Registrable Shares are sold, whichever is
earlier.
4. Section 13 of the Agreement is hereby amended by striking the
section in its entirety and substituting the following in place thereof:
13. TERM OF AGREEMENT. This Agreement shall become effective as of
the date first written above and shall remain in full force and effect until the
earliest to occur of the following: (i) Corporation and all of the Stockholders
then holding Shares subject to this Agreement shall agree in writing to its
termination; (ii) the offering by the Corporation of shares of the Common Stock
of the Corporation pursuant to a registration statement that is effective under
the Securities Act or the Corporation otherwise becoming a reporting company
under Section 13 or 15(d) of the Exchange Act, PROVIDED, HOWEVER, that the
provisions of Sections 5, 6 and 7 of this Agreement (and the defined terms and
miscellaneous provisions of this Agreement pertaining thereto) shall remain in
effect until satisfied; (iii) the purchase by one Stockholder of all the issued
and outstanding Shares of the Corporation; or (iv) the dissolution, bankruptcy
or receivership of the Corporation. Upon termination of this Agreement, the
Secretary of the Corporation shall, as appropriate, upon tender of the
certificates for Shares, delete the legends endorsed thereon pursuant to Section
8 of this Agreement.
5. Section 16 of the Agreement is hereby amended by striking the
section in its entirety and substituting the following in place thereof:
16. AMENDMENT. No change, modification or amendment of this
Agreement shall be valid unless the same shall be in writing and signed by the
holders of at least ninety percent (90%) of the then outstanding Registrable
Shares.
6. To the extent of any inconsistency, ambiguity or conflict
between the terms of the Agreement and this Amendment No. 1, the terms of this
Amendment No. 1 shall govern and control.
7. Except as expressly amended hereby, the Agreement shall remain
unchanged and in full force and effect.
[Signature Page Follows]
[SIGNATURE PAGE TO AMENDMENT NO.1 TO STOCKHOLDER AND
REGISTRATION RIGHTS AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Amendment No. 1 to
be duly executed as of the date first set forth above.
SOFTWAVE MEDIA EXCHANGE, INC.
By: /s/ Xxxxxx Xxxxxx
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Name: Xxxxxx Xxxxxx
Title: Chief Executive Officer
STOCKHOLDER
By:
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Name:
Title:
