Exhibit 10.10
VSTREAM INCORPORATED
Series D Preferred Stock Purchase Agreement
Series D Preferred Stock Purchase Agreement
This Series D Preferred Stock Purchase Agreement (the "Agreement") is
entered into as of November 17, 1999, by and among VStream Incorporated, a
Delaware corporation (the "Company"), and each of those persons and entities,
severally and not jointly, whose names are set forth on Exhibit B attached
hereto (collectively the "Purchasers" and individually a "Purchaser").
Capitalized terms not otherwise defined herein are defined in Section 7.1.
In consideration of the mutual promises hereinafter set forth, the parties
hereto agree as follows:
1. Agreement To Sell And Purchase
1.1 Authorization of Shares. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to the
Purchasers of shares of its Series D Convertible Preferred Stock (the "Shares")
having the rights, preferences, privileges and restrictions set forth in the
Certificate of Amendment to the Certificate of Incorporation of the Company,
attached hereto as Exhibit A (the "Certificate").
1.2 Sale and Purchase. Subject to the terms and conditions hereof, at the
Closing the Company hereby agrees to issue and sell to each Purchaser and each
Purchaser severally and not jointly agrees to purchase from the Company, the
number of Shares set forth opposite such Purchaser's name on Exhibit B, at a
purchase price of Three Dollars ($3.00) per Share.
2. Closing, Delivery And Payment
2.1 Closing. The closing (the " Closing") shall take place at the offices
of the Company at 10:00 a.m. (Mountain Daylight Time) on November 17, 1999 or
at such other place and on such other date as may be mutually agreeable to the
Company and a majority of the Purchasers upon the satisfaction or waiver of the
conditions set forth in Section 5 herein. At the Closing, subject to the
terms and conditions hereof, the Company will deliver to the Purchasers
certificates representing the number of Shares to be purchased at the Closing by
each Purchaser as set forth on Exhibit B hereto, against payment of the purchase
price therefor by check or wire transfer of immediately available funds.
2.2 Additional Closing(s).
(a) Conditions of Additional Closing(s). At any time and from time to time
during the period immediately following the Closing until the earlier to occur
of (i) December 31, 1999 or (ii) the later of (A) such date that the consent
referred to in Section 5(s) herein is obtained or (B) December 15, 1999 (the
"Additional Closing
Period"), upon satisfaction or waiver of the conditions set forth in Section 5
herein and subject to the terms and conditions hereof, the Company may, at one
or more additional closings (each, an "Additional Closing"), without obtaining
the signature, consent or permission of any of the Purchasers, offer and sell to
other investors listed on Exhibit B and Exhibit B-1(the "Additional
Purchasers"), at a price of Three Dollars ($3.00) per share, up to a maximum of
33,333,334 Shares in the aggregate (including the Shares issued at the Closing).
Additional Purchasers may include persons or entities who are already Purchasers
under this Agreement.
(b) Amendments. The Company and the Additional Purchasers purchasing Shares at
each Additional Closing will execute counterpart signature pages to this
Agreement, the Amended and Restated Stockholders' Agreement attached hereto as
Exhibit C (the "Stockholders' Agreement") and the Amended and Restated
Investors' Agreement attached hereto as Exhibit D (the "Investors' Agreement"),
and such Additional Purchasers will, upon delivery to the Company of such
signature pages, become parties to, and bound by, this Agreement, the
Stockholders' Agreement and the Investors' Agreement (collectively, the
"Transaction Documents"), each to the same extent as if they had been Purchasers
at the Closing. Immediately after each Additional Closing, Exhibit B-1 to this
Agreement will be amended to list the Additional Purchasers hereunder and the
number of Purchased Shares purchased by each Additional Purchaser under this
Agreement at each such Additonal Closing. The Company will promptly furnish to
each Purchaser copies of the amendments to Exhibit B referred to in the
preceding sentence.
(c) Status of Additional Purchasers. Upon the completion of each Additional
Closing as provided in this Section 2, each Additional Purchaser will be deemed
to be a "Purchaser" for all purposes of this Agreement and the other Transaction
Documents.
(d) Authorized Shares Not Fully Sold. If fewer than all of the authorized
Shares are sold by the end of the Additional Closing Period, then the Company
will promptly take all actions as may be necessary to amend the Company's
Certificate to (i) reduce the number of authorized Shares to the number of
Shares then issued and outstanding, plus 333,333 shares and (ii) reduce the
authorized number of shares of Preferred Stock (as defined in Section 3.2 below)
to the sum of the number of authorized shares of each series of Preferred Stock
after giving effect to the adjustment in clause (i) above.
3. Representations And Warranties Of The Company
The Company hereby represents and warrants to each Purchaser that except as
set forth on the Disclosure Schedule attached hereto, which shall be deemed
representations and warranties as if made hereunder:
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3.1 Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
each of the Transaction Documents, to issue and sell the Shares and the shares
of the Company's common stock, $.001 par value (the "Common Stock") issuable
upon conversion thereof (the "Conversion Shares"), to carry out the other
provisions of this Agreement and the Stockholders Agreement, and to carry on its
business as presently conducted and as presently proposed to be conducted. The
Company is qualified to do business as a foreign corporation and is in good
standing in all jurisdictions in which it is required to be so qualified to do
business as currently conducted and presently proposed to be conducted by the
Company, except for in such jurisdictions in which the failure to so qualify
would not reasonably be expected to have a material adverse effect on the
business or operations of the Company.
3.2 Capitalization. The authorized capital stock of the Company, immediately
prior to the Closing, will consist of fifty seven million (57,000,000) shares of
Common Stock, seven hundred eighty three thousand seven hundred and eight
(783,708) shares of which are issued and outstanding, and fifty million
(50,000,000) shares of preferred stock, of which (i) five million twenty-five
thousand (5,025,000) shares are designated Series A Convertible Preferred Stock,
all of which are issued and outstanding, (ii) ten thousand, six hundred thirty-
five (10,635) shares are designated Series B Convertible Preferred Stock, all of
which are issued and outstanding, (iii) ten million (10,000,000) shares are
designated Series C Convertible Preferred Stock, nine million nine hundred fifty
three thousand nine hundred and thirty five (9,953,935) of which are issued and
outstanding and (iv) thirty four million (34,000,000) shares are designated
Series D Convertible Preferred Stock, none of which is issued and outstanding.
(The Series A Convertible Preferred Stock, the Series B Convertible Preferred
Stock, the Series C Convertible Preferred Stock and the Series D Convertible
Preferred Stock are collectively referred to as the "Preferred Stock".) All
issued and outstanding shares of the Company's Common Stock, Series A
Convertible Preferred Stock, Series B Convertible Preferred Stock and Series C
Convertible Preferred Stock have been duly authorized and validly issued and are
fully paid and nonassessable. Except as set forth in Schedule 3.2, there are
no outstanding options, warrants or other rights to purchase from the Company
any of its securities. Except as set forth in Schedule 3.2 of the Disclosure
Schedule, no shares of the Company's outstanding capital stock, or stock
issuable upon exercise or exchange of any outstanding options, warrants or
rights, or other stock issuable by the Company, are subject to any preemptive
rights, rights of first refusal or other rights to purchase such stock (whether
in favor of the Company or any other person) pursuant to any agreement or
commitment of the Company.
3.3 Subsidiaries. The Company does not presently own or control, directly or
indirectly, any interest in any other corporation, partnership, trust, joint
venture, association or other entity.
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3.4 Authorization; Binding Obligations. All corporate action on the part of
the Company, its officers, directors and stockholders necessary for the
authorization of this Agreement, the performance of all obligations of the
Company hereunder and under the Transaction Documents and for the authorization,
sale, issuance and delivery of the Shares has been taken or will be taken at or
prior to the Closing. When issued in compliance with the provisions of this
Agreement , the Shares will be validly issued, fully paid and nonassessable.
The Conversion Shares have been duly and validly reserved for issuance and, when
issued upon conversion of the Series D Preferred Stock in accordance with the
terms of the Certificate, will be validly issued, fully paid and nonassessable.
The Transaction Documents have been duly executed by the Company and constitute
valid and binding obligations of the Company enforceable in accordance with
their terms except (i) as limited by applicable bankruptcy, reorganization,
insolvency, moratorium and similar laws affecting the rights of creditors
generally (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) to the
extent the indemnification provision contained in the Stockholders Agreement may
be limited by applicable federal or state securities laws.
3.5 Consents and Approvals. No filings with, notices to, or approvals of any
governmental or regulatory body are required to be obtained or made by the
Company in connection with the consummation of the transactions contemplated
hereby except for filings pursuant to state securities laws (all of which have
been made by the Company, other than those which are required to be made after
the Closing and which will be duly made on a timely basis).
3.6 No Violations. The execution and delivery of this Agreement and the
Transaction Documents and the performance by the Company of its obligations
hereunder and thereunder (i) do not and will not conflict with or violate any
provision of the certificate of incorporation, as amended, (including the
Certificate), or bylaws of the Company and (ii) do not and will not (a) conflict
with or result in a breach of the terms, conditions or provisions of, (b)
constitute a default under, (c) result in the creation of any encumbrance upon
the capital stock or assets of the Company pursuant to, (d) give any third party
the right to modify, terminate or accelerate any obligation under, (e) result in
a violation of, or (f) require any authorization, consent, approval, exemption
or other action by or notice to any court or administrative or governmental body
or other third party pursuant to, any law, statute, rule or regulation or any
agreement or instrument or any order, judgment or decree to which the Company is
subject or by which any of its assets are bound which would have a material
adverse effect on the business, assets, financial condition or operations of the
Company.
3.7 Financial Statements; Interim Changes. The Company's audited balance
sheet as of December 31, 1998 and audited statements of operations and cash
flows of the Company for the 12-month period ended December 31, 1998 and the
Company's unaudited balance sheet as of September 30, 1999 (the "Latest Balance
Sheet") and unaudited statements of operations and cash flows of the Company for
the 9-month
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period ending September 30, 1999 delivered to the Purchasers in connection with
the investment contemplated hereby have been prepared in accordance with
generally accepted accounting principles consistently applied (subject to normal
year-end adjustments and the absence of footnote disclosures in the unaudited
statements) and fairly present in all material respects the financial position
and the results of operations of the Company for the period covered thereby, and
the Company has no material liabilities or obligations of any nature (absolute,
accrued, contingent or otherwise) that are not either reflected or fully
reserved against on the Latest Balance Sheet or incurred in the ordinary course
of the business of the Company subsequent to the date thereof. Since the date of
the Latest Balance Sheet, there has not been any material adverse change in the
business, operations, or financial condition as presently conducted or presently
proposed to be conducted by the Company (a "Material Adverse Change").
3.8 Compliance with Laws. The Company is not in violation or default of any
provisions of its Certificate of Incorporation or Bylaws, both as amended to-
date. The Company's business has been conducted in compliance with all
applicable laws and regulations of governmental authorities, except for such
violations that have been cured or that, individually or in the aggregate, may
not reasonably be expected to have a Material Adverse Change.
3.9 Proprietary Rights. Section 3.9 of the Disclosure Schedule contains a
complete and accurate list of (i) all patented and registered Proprietary Rights
owned by the Company, (ii) all pending patent applications and applications for
registrations of other Proprietary Rights filed by the Company, (iii) all
unregistered trade names and corporate names owned or used by the Company and
(iv) all unregistered trademarks, service marks and copyrights and computer
software, which are material to the financial condition, operating results,
assets, operations or business of the Company. Section 3.9 of the Disclosure
Schedule also contains a complete and accurate list of all licenses and other
rights granted by the Company to any third party with respect to any Proprietary
Rights and all licenses and other rights granted by any third party to the
Company with respect to any Proprietary Rights, except for "shrink-wrapped" or
similar licenses granted to the Company by third parties for software used in
the business of the Company that is generally commercially available. The
Company owns or has the right to use pursuant to a valid license all Proprietary
Rights necessary for the operation of the businesses of the Company as presently
conducted and as presently proposed to be conducted. To the Company's
knowledge, no loss or expiration of any Proprietary Right or related group of
Proprietary Rights is threatened, pending or expected. The Company has taken
all reasonably necessary actions to maintain and protect the Proprietary Rights
which it owns and uses. The Company has no reason (without having conducted any
special investigation) to believe that the owners of any Proprietary Rights
licensed to the Company have not taken actions necessary to maintain and protect
the Proprietary Rights which are subject to such licenses. Except as indicated
on Section 3.9 of the Disclosure Schedule, (i) the Company owns all right,
title, and interest in and to or has the right to use under a valid license all
of the Proprietary Rights listed on such schedule and all other Proprietary
Rights material to
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the operation of the business of the Company, (ii) there have been no claims
made against the Company asserting the invalidity, misuse or unenforceability of
any of such rights and to the Company's knowledge, none is threatened, (iii) the
Company has not received a notice of conflict with the asserted rights of
others, and (iv) to the knowledge of the Company (without having conducted a
special investigation or patent search) the conduct of the Company's business
has not infringed or misappropriated and does not infringe or misappropriate any
Proprietary Rights of other Persons, and, to the Company's knowledge, the
Proprietary Rights owned by the Company have not been infringed or
misappropriated by other Persons.
3.10 Actions Pending. There is no action, suit or proceeding pending or, to
the knowledge of the Company, threatened against or affecting the Company or any
of its respective properties or rights before any court or by or before any
governmental body or arbitration board or tribunal.
3.11 Material Contracts. Except as set forth on Section 3.11 of the
Disclosure Schedule, the Company is not a party to (and is not otherwise bound
by) any of the following: (i) any employment or consulting contract, (ii) any
agreement providing for the issuance or repurchase of any securities of the
Company, (iii) any agreement in respect of registration rights, preemptive
rights, rights of first refusal, voting rights or other rights of security
holders, (iv) any agreement evidencing or providing for any indebtedness for
borrowed money, or (v) any other agreement that could reasonably be deemed
material to the Company.
3.12 Investments in United States Real Property Interests. The Company's
capital stock does not constitute a United States real property interest as that
term is defined in Section 897(c)(1)(A)(ii) of the Internal Revenue Code of
1986, as amended (the "Code"). The preceding representation is based on a
determination by the Company that the Company is not and has not been a United
States real property holding corporation (as that term is defined in Section
897(c)(2) of the Code) ("USRPHC") during the five (5) year period preceding the
date of this Agreement. From time to time, upon request of any Purchaser, the
Company shall make a determination as to its status as a USRPHC. If at any time
in the future the Company should become a USRPHC, the Company shall, as promptly
as possible, notify each Purchaser of such change in status.
3.13 Unrelated Business Taxable Income. Any gross income derived by the
Purchasers from the Company shall be in the form of dividends, interest, capital
gains and losses from the disposition of property, and rents and royalties, but
only such rents and royalties as are excluded pursuant to Code Sections
512(b)(2) and 512(b)(3), respectively, in calculating unrelated business taxable
income and only such dividends, interest, capital gains and losses, and rents
and royalties that are not included under Section 512(b)(4) of the Code in
calculating unrelated business taxable income.
3.14 Year 2000 Compliance. To the knowledge of the Company, all of its
products (including products currently under development) will record, store,
process and
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calculate and present calendar dates falling on and after January 1, 2000, and
will calculate any information dependent on or relating to such dates in the
same manner and with the same functionality, data integrity and performance as
the products record, store, process, calculate and present calendar dates on or
before December 31, 1999, or calculate any information dependent on or relating
to such dates (collectively "Year 2000 Compliant").
3.15 Taxes. The Company has filed all tax returns (including statements of
estimated taxes owed) required to be filed within the applicable periods for
such filings and has paid all taxes required to be paid (other than those
contested in good faith for which adequate reserves have been established), and
has established adequate reserves (net of estimated tax payments already made)
for the payment of all taxes payable in respect of the period subsequent to the
last periods covered by such returns. There is no pending dispute with any
taxing authority relating to any of such returns and the Company has not
received notice of any proposed liability for any tax to be imposed upon the
properties or assets of the Company. No deficiencies for any tax are currently
assessed against the Company, and no tax returns of the Company have ever been
audited, and, to the knowledge of the Company, there is no such audit pending
or threatened. There is no tax lien, whether imposed by any federal, state or
local taxing authority, outstanding against the assets, properties or business
of the Company or its predecessor, except such liens for taxes not yet due and
payable as may accrue in the ordinary course of business and for which the
Company has established reasonable reserve and as would not, in any case,
constitute a Material Adverse Change.
3.16 Real Property.
(a) The Disclosure Schedule sets forth the addresses and uses of all
real property that the Company owns, leases or subleases, and any material lien
or encumbrance on any such owned real property or the Company's leasehold
interest therein, specifying in the case of each such lease or sublease, the
name of the lessor or sublessor, as the case may be, and the lease term. Copies
of all leases have been provided to special counsel to the Purchasers.
(b) The Company has good and marketable title to, and owns free and
clear of all liens and encumbrances, all property listed as owned by the Company
on the Disclosure Schedule, and, to the knowledge of the Company, there is no
material violation of any law, regulation or ordinance (including without
limitation laws, regulations or ordinances relating to zoning, environmental,
city planning or similar matters) relating to any real property owned, leased or
subleased by the Company. With respect to the property it leases, the Company is
in compliance with all such leases and, to its knowledge, holds a valid
leasehold interest free of any liens, claims or encumbrances.
(c) There are no defaults by the Company or, to the knowledge of the
Company, by any other party thereto, which might curtail in any material respect
the
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current use of the Company's property listed on the Disclosure Schedule. Except
for property sold or otherwise disposed of in the ordinary course of business
since September 30, 1999, the Company owns free and clear of any liens or
encumbrances, all of the personal property reflected as owned by the Company in
the balance sheet contained in the Unaudited Financial Statements, and all other
material items of personal property acquired by the Company through the date
hereof. All material items of such personal property are in good operating
condition, normal wear and tear excepted.
3.17 Insurance Coverage. The Disclosure Schedule contains an
accurate summary of the insurance policies currently maintained by the Company.
There are currently no claims in excess of $50,000 in the aggregate pending
against the Company under any insurance policies currently in effect and
covering the property, business or employees of the Company, and all premiums
due and payable with respect to the policies maintained by the Company have been
paid to date.
3.18 Employees and Actions. The Company is not bound by or subject to (and
none of its assets or properties are bound by or subject to) any contract,
commitment or arrangement with any labor union, and no labor union has requested
or, to the knowledge of the Company, has sought to represent any of the
employees, representatives or agents of the Company. There is no strike or
other labor dispute involving the Company pending, or to the knowledge of the
Company threatened, which could constitute a Material Adverse Change, nor is the
Company aware of any labor organization activity involving its employees. The
Company is not aware that any officer or key employee, or that any group of key
employees, intends to terminate his, her or its employment with the Company, nor
does the Company have a current intention to terminate the employment of any of
the foregoing. Subject to general principles related to wrongful termination of
employees, the employment of each officer and employee of the Company is
terminable at the will of the Company. Except as set forth on the Disclosure
Schedule, there are no employment, consulting or management agreements covering
the management of the Company.
3.19 No Brokers or Finders. No person has or will have, as a result of the
transactions contemplated by this Agreement, any right, interest or claim
against or upon the Company for any commission, fee or other compensation as a
finder or broker because of any act or omission by the Company.
3.20 Alliances, etc. Except as set forth on the Disclosure Schedule, the
Company is not engaged in any joint venture or partnership with any other
Person.
3.21 ERISA.
(a) Schedule 3.21 sets forth: (i) all "employee benefit plans", as
defined in Section 3(3) of the Employee Retirement Security Act of 1974, as
amended , and the rules and regulations promulgated thereunder ("ERISA"), and
any other
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employee benefit arrangements or payroll practices, including, without
limitation, severance pay, sick leave, vacation pay, salary continuation for
disability, consulting or other compensation agreements, retirement, deferred
compensation, bonus, stock purchase, hospitalization, medical insurance, life
insurance and scholarship programs (the "Plans") maintained by Company or to
which Company contributed or is obligated to contribute thereunder, and (ii) all
"employee pension plans", as defined in Section 3(2) of ERISA (the "Pension
Plans"), maintained by Company to which the Company contributed or is obligated
to contribute thereunder.
(b) Purchasers will not have (i) any obligation to make any
contribution to any Multiemployer Plan (as defined under ERISA) or (ii) any
withdrawal liability from any such Multiemployer Plan under Section 4201 of
ERISA which it would not have had if it had not purchased the Shares from the
Company at the Closing in accordance with the terms of this Agreement.
(c) The Pension Plans intended to be qualified under Section 401 of
the Internal Revenue Code of 1986, as amended (the "IRC") are so qualified and
the trusts maintained pursuant thereto are exempt from federal income taxation
under Section 501 of the IRC, and nothing has occurred with respect to the
operation of the Pension Plans which could cause the loss of such qualification
or exemption or the imposition of any liability, penalty, or tax under ERISA or
the IRC.
(d) All contributions required by law or pursuant to the terms of
the Plans (without regard to any waivers granted under Section 412 of the IRC)
to any funds or trusts established thereunder or in connection therewith have
been made by the due date thereof (including any valid extension) and no
accumulated funding deficiencies exist in any of the Pension Plans.
(e) There is no "amount of unfunded benefit liabilities" as defined
in Section 4001(a)(18) of ERISA in any of the respective Pension Plans.
(f) There has been no "reportable event" as that term is defined
in Section 4043 of ERISA and the regulations thereunder with respect to the
Pension Plans which would require the giving of notice, or any event requiring
disclosure under Sections 4041(c)(3)(C), 4063(a) or 4068(f) of ERISA.
(g) There is no material violation of ERISA with respect to the
filing of applicable reports, documents, and notices regarding the Plans with
the Secretary of Labor and the Secretary of the Treasury or the furnishing of
such documents to the participants or beneficiaries of the Plans.
(h) True, correct and complete copies of the following documents,
with respect to each of the Plans, have been made available or delivered to the
Purchasers by the Company: (A) any plans and related trust documents, and
amendments thereto, (B) the most recent Forms 5500 (including any schedules
thereto) and the most recent actuarial valuation report, if any, (C) the last
Internal Revenue Service determination
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letter, (D) summary plan descriptions, (E) written communications to employees
relating to the Plans and (F) written descriptions of all non-written agreements
relating to the Plans.
(i) There are no pending actions, claims or lawsuits which have been
asserted or instituted against the Plans, the assets of any of the trusts under
such Plans or the Plan sponsor or the Plan administrator, or against any
fiduciary of the Plans with respect to the operation of such Plans (other than
routine benefit claims), nor does the Company have knowledge of facts which
could form the basis for any such claim or lawsuit.
(j) All amendments and actions required to bring the Plans into
conformity in all material respects with all of the applicable provisions of
ERISA and other applicable laws have been made or taken except to the extent
that such amendments or actions are not required by law to be made or taken
until a date after the Closing Date.
(k) The Plans have been maintained, in all material respects, in
accordance with their terms and with all provisions of ERISA (including rules
and regulations thereunder) and other applicable Federal and state law, and
neither the Company nor a "party in interest" or a "disqualified person" with
respect to the Plans has engaged in a "prohibited transaction" within the
meaning of Section 4975 of the IRC or Section 406 of ERISA.
(l) Neither the Company nor any Person that, together with the
Company, would be or was at any time treated as a single employer under Section
414 of the Code or Section 4001 of ERISA or any general partnership of which the
Company is or has been a general partner (an "ERISA Affiliate") has terminated
any Pension Plan, or incurred any outstanding liability under Section 4062 of
ERISA to the PBGC, or to a trustee appointed under Section 4042 of ERISA.
(m) Neither the Company nor any ERISA Affiliate maintains retired
life and retired health insurance plans which provide for continuing benefits or
coverage for any participant or any beneficiary of a participant except as may
be required under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA") and at the expense of the participant or the participant's
beneficiary.
(n) Neither the Company nor any ERISA Affiliate has contributed or
been obligated to contribute to a Multiemployer Plan through the Closing.
(o) Neither the Company nor any ERISA Affiliate has withdrawn in a
complete or partial withdrawal from any Multiemployer Plan prior to the Closing
Date, nor has any of them incurred any liability due to the termination or
reorganization of a Multiemployer Plan.
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(p) Neither the Company nor any ERISA Affiliate or any organization
to which Company is a successor or parent corporation, within the meaning of
Section 4069(b) of ERISA, has engaged in any transaction, within the meaning of
Section 4069 of ERISA.
3.22 Full Disclosure. No information contained in this Agreement, any other
Transaction Document, the Financial Statements or any written statement
furnished by or on behalf of Company pursuant to the terms of this Agreement
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein or therein not misleading
in light of the circumstances under which made.
3.23 Securities Laws. In reliance on the investment representations contained
in Section 4, the offer, issuance, sale and delivery of the Shares, as provided
in this Agreement, are exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and all applicable
state securities laws, and are otherwise in compliance with such laws. Neither
the Company nor any person acting on its behalf has taken or will take any
action (including, without limitation, any offering of any securities of Company
under circumstances which would require the integration of such offering with
the offering of the Shares under the Securities Act and the rules and
regulations of the Securities and Exchange Commission ("SEC") thereunder) which
might subject the offering, issuance or sale of the Shares to the registration
requirements of Section 5 of the Securities Act.
3.24 Inventions Assignment and Confidentiality Agreement. Each employee and
contractor of the Company has entered into and executed a Proprietary
Information and Inventions Agreement in the form attached to this Agreement as
Exhibit H or an employment or consulting agreement containing substantially
similar terms.
3.25 Interested Party Transactions. To the knowledge of the Company, no
officer or director of the Company or any "affiliate" or "associate" (as those
terms are defined in Rule 405 promulgated under the Securities Act) of any such
person has had, either directly or indirectly, a material interest in: (i) any
person or entity which purchases from or sells, licenses or furnishes to the
Company any goods, property, technology, intellectual or other property rights
or services; or (ii) any contract or agreement to which the Company is a party
or by which it may be bound or affected.
3.26 Environmental Matters. The Company knows of no violation or violations by
the Company, its employees or agents of any environmental or safety statute, law
or regulation that in the aggregate would have a Material Adverse Effect, no
material expenditures are or will be required in order to comply with any such
existing statute, law or regulation. No action, proceeding, permit revocation,
writ, injunction or claim is pending or, to the Company's knowledge threatened
concerning the Company's facilities and the Company is not aware of any fact or
circumstance which could involve
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the Company in any environmental litigation or impose any material environmental
liability upon the Company. As of the Closing, no Hazardous Material (as defined
below) is present on any Company facility and, to the Company's knowledge, no
reasonable likelihood exists that any Hazardous Material present on other
property will come to be present on a Company facility. To the Company's
knowledge, there are no underground storage tanks, asbestos or PCBs present on a
Company facility. For the purposes of this Section 3.26, the term "Hazardous
Material" shall mean any material or substance that is prohibited or regulated
by any environmental law or that has been designated by any governmental
authority to be radioactive, toxic, hazardous or otherwise a danger to health,
reproduction or the environment.
3.27 Company Status. The Company is not (i) a "public utility holding
company" or a "holding company" as defined in the Public Utility Holding Company
Act of 1935, as amended, or (ii) an "investment company" as defined in the
Investment Company Act of 1940, as amended.
4. Representations And Warranties Of The Purchasers
Each Purchaser, severally and not jointly, hereby represents and warrants
to the Company as follows:
4.1 Requisite Power and Authority. Such Purchaser has all necessary power and
authority under all applicable provisions of law to execute and deliver this
Agreement and each of the Transaction Documents and to carry out the provisions
hereunder and thereunder. All actions on such Purchaser's part required for the
lawful execution and delivery of this Agreement and each of the Transaction
Documents have been or will be effectively taken prior to the Closing and each
such agreement constitutes a valid and binding obligation of such Purchaser,
enforceable in accordance with its terms, except (i) as limited by applicable
bankruptcy, reorganization, insolvency, moratorium and similar laws affecting
the rights of creditors generally (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies and (iii) to the extent the indemnification provision contained in the
Stockholders Agreement may be limited by applicable federal or state securities
laws.
4.2 Investment Representations. Such Purchaser understands that neither the
Shares nor the Conversion Shares have been registered under the Securities Act.
Such Purchaser also understands and hereby confirms that the Shares are being
offered and sold pursuant to an exemption from registration contained in the
Securities Act based in part upon the Purchaser's representations contained in
this Agreement.
(a) Purchaser Bears Economic Risk. Such Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Such
12
Purchaser must bear the economic risk of this investment indefinitely unless the
Shares (or the Conversion Shares) are registered pursuant to the Securities Act,
or an exemption from registration is available. Such Purchaser understands that
the Company has no present intention of registering the Shares, the Conversion
Shares or any shares of its Common Stock or Preferred Stock. Such Purchaser also
understands that there is no assurance that any exemption from registration
under the Securities Act will be available and that, even if available, such
exemption may not allow such Purchaser to transfer all or any portion of the
Shares or the Conversion Shares under the circumstances, in the amounts or at
the times such Purchaser might propose.
(b) Acquisition for Own Account. Such Purchaser is acquiring the
Shares and the Conversion Shares for its own account for investment only, and
not with a view towards their public resale or distribution within the meaning
of the Securities Act; provided that the disposition thereof shall be and remain
in the control of such Purchaser. By executing this Agreement, each Purchaser
further represents that such Purchaser does not have any contract, undertaking,
agreement or arrangement with any person to sell, transfer or grant
participation to such person or to any third person, with respect to any of the
Shares.
(c) Purchaser Can Protect Its Interest. Such Purchaser represents
that, by reason of its or of its management's business or financial experience,
such Purchaser has the capacity to protect its own interests in connection with
the transactions contemplated in this Agreement. Further, such Purchaser is
aware of no publication of any advertisement in connection with the transactions
contemplated by the Agreement.
(d) Accredited Investor. Such Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(e) Company Information. Such Purchaser has had an opportunity to
discuss the Company's business, management and financial affairs with directors,
officers and management of the Company. Such Purchaser has also had the
opportunity to ask questions of, and receive answers from, the Company and its
management regarding the terms and conditions of this investment.
(f) Rule 144. Such Purchaser acknowledges and agrees that the Shares
and the Conversion Shares must be held indefinitely unless they are subsequently
registered under the Securities Act or an exemption from such registration is
available. Such Purchaser has been advised or is aware of the provisions of Rule
144 promulgated under the Securities Act, which permits limited resales of
shares purchased in a private placement subject to the satisfaction of certain
conditions, including, among other things: the availability of certain current
public information about the Company, the resale occurring not less than one
year after a party has purchased and paid for the security to be sold, the sale
being through an unsolicited "broker's transaction" or in transactions directly
with a market maker (as said term is defined under the Securities
13
Exchange Act of 1934, as amended) and the number of shares being sold during any
three-month period not exceeding specified limitations.
(g) Further Limitations on Disposition. Without in any way limiting the
representations set forth above, each Purchaser further agrees not to make any
disposition of all or any portion of the Shares (or the Conversion Shares
issuable upon the conversion thereof) unless and until there is then in effect a
Registration Statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with such Registration
Statement, or such Purchaser shall have established to the reasonable
satisfaction of the Company that an exemption from registration is available.
(h) Legends. It is understood that the certificates evidencing the
Shares (and the Conversion Shares) may bear one or all of the following legends:
(i) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT
TO THE SECURITIES UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN
EXEMPTION FROM REGISTRATION BEING AVAILABLE UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS."
(ii) Any legend required by any applicable state securities laws.
(iii) Any legend required by the Stockholders Agreement or the
Investors Agreement.
5. Conditions Precedent To Purchasers' Obligations
The obligation of each Purchaser to purchase and pay for the Shares to be
delivered to it at the Closing or any Additional Closing shall be subject to
the satisfaction of the following conditions as of the Closing or Additional
Closing(except as otherwise noted):
(a) Representations and Warranties. The representations and warranties of
the Company contained in this Agreement shall be true and correct in all
respects;
(b) Performance. The Company shall have performed and complied with all
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing,
and shall have obtained all approvals, consents and qualifications
necessary to complete the purchase and sale described herein.
(c) Certificate Effective. The Certificate shall have been duly adopted by
the Company by all necessary corporate action of its Board of Directors and
14
stockholders, and shall have been duly filed with and accepted by the
Secretary of State of Delaware.
(d) Compliance Certificate. The Company shall have delivered to a
representative of all of the Purchasers at Closing a certificate signed on
its behalf by its President, Chief Executive Officer or Chief Financial
Officer certifying that the conditions specified in Sections 5(a) - (c) have
been fulfilled and stating that there shall have been no Material Adverse
Change not previously disclosed to the Purchasers in writing.
(e) Securities Exemptions. The offer and sale of the Shares to the
Purchasers pursuant to this Agreement shall be exempt from the registration
requirements of the Securities Act and the registration and/or qualification
requirements of all other applicable state securities laws.
(f) Proceedings and Documents. All corporate and other proceedings in
connection with the transactions contemplated at the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to a majority of the Purchasers and to special counsel to the
Purchasers. Such documents shall include (but not be limited to):
(i) Certified Charter Documents. A copy of the Certificate (as
amended through the date of the Closing), certified by the Secretary of the
Company as a true and correct copy thereof as of Closing.
(ii) Corporate Actions. A copy of the resolutions of the Board of
Directors, and, if required, the stockholders of the Company evidencing the
amendment to the Certificate providing for the authorization of the Shares,
the approval of the Transaction Documents and the consummation of the
transactions contemplated hereby and thereby, including the issuance and
sale of the Shares and the other matters contemplated thereby.
(iii) Secretary's Incumbency Certificate. A certificate of the
Secretary or Assistant Secretary or other officer of the Company certifying
the names of the officers of the Company authorized to sign this Agreement,
the certificates for the Shares purchased under this Agreement and the other
documents, instruments or certificates to be delivered pursuant to this
Agreement by the Company or any of its officers, together with the true
signatures of such officers.
(iv) Good Standing Certificates. Certificate of good standing
issued by the Delaware Secretary of State dated within ten (10) days of the
Closing.
(g) Bylaws. The Bylaws of the Company shall be in the form previously
15
provided to special counsel for the Purchasers.
(h) Investors' Agreement. Concurrent with the Closing or any Additional
Closing, the Company, each Purchaser participating in such Closing and the
participating parties to the Investors' Agreement dated May 27, 1998 between
the Company and certain stockholders, shall have entered into the Investors
Agreement;
(i) Stockholders' Agreement. Concurrent with the Closing or any Additional
Closing, the Company, the Purchasers participating in such closing and the
parties to the Stockholders' Agreement dated May 27, 1998 between the
Company and certain stockholders of the Company shall have entered into the
Stockholders Agreement;
(j) Legal Opinion. The Purchasers shall have received the legal opinion of
E*Law Group, counsel to the Company, in the form of Exhibit E hereto as of
the date of the Closing and each Additional Closing;
(k) Centennial Certification. Solely with respect to Centennial's obligation
to purchase Shares at Closing, the Company shall have provided to each of
Centennial Fund V, L.P., Centennial Fund VI, L.P. and certain other
affiliated entities ("Centennial"), a certification of the direct and
indirect holdings of securities of the Company by certain persons designated
by Centennial as required by Centennial's governing documents;
(l) Shares Purchased. A minimum of 13,391,666 Shares shall be concurrently
purchased by the Purchasers for a minimum aggregate purchase price of
$40.175 million at the Closing;
(m) Services Agreement. Solely with respect to the obligations of @Home to
purchase Shares hereunder, the Company and @Home shall have entered into
that certain Services Agreement (the "Services Agreement"), a form of which
is attached hereto as Exhibit F;
(n) Software License Agreement. Solely with respect to the obligations of
Intel Corporation ("Intel") to purchase Shares hereunder, the Company shall
have entered into that certain Software License Agreement (the "License
Agreement") substantially in the form of Exhibit G attached hereto;
(o) Proprietary Information and Inventions Agreements. Each officer and key
employee of the Company shall have entered into a Proprietary Information
and Inventions Agreement, substantially in the form of Exhibit H attached
hereto.
(p) Employment Agreements. Prior to the Closing, Messrs. Xxxxxxxxx and
LeJeal shall have entered into employment agreements satisfactory to each of
16
them, the Company and special counsel to the Purchasers.
(q) Existing First Refusal Rights. Any preemptive rights, rights of first
refusal or other similar rights as they apply to the issuance and sale of
the Shares totaling greater than 50,000 shares, individually or in the
aggregate, shall have been waived and released in writing or shall have
been satisfied in full.
(r) No Material Change. There shall not have been a Material Adverse
Change since the date of the Latest Balance Sheet.
(s) Centennial Consent. Solely with respect to Centennial's obligation to
purchase Shares in an Additional Closing, (i) Centennial shall have
received any consents required pursuant to its governing documents and (ii)
all applicable waiting periods (and any extensions thereof) under the Xxxx-
Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), shall have expired or otherwise been terminated; provided, however,
that the Investors shall use their reasonable best efforts to ensure that
any applicable waiting periods under the HSR Act are subject to early
termination on or before December 15, 1999;
(t) EMC Supply Agreement. Solely with respect to the obligation of XXX
Xxxxxxxxxxx ("EMC") to purchase Shares hereunder, the Company shall have
entered into that certain Supply Agreement (the "Supply Agreement")
substantially in the form of Exhibit I attached hereto.
6. Expense Reimbursement
The Company hereby agrees to reimburse each Purchaser for its out-of-
pocket expenses incurred in connection with the transactions contemplated
hereby, including all expenses incurred in connection with its due diligence
examination of the Company, the preparation and negotiation of this Agreement,
the Transaction Documents and all other documents evidencing the transactions
contemplated herein (including the fees and expenses of counsel to the
Purchasers not to exceed $100,000 in the aggregate, such aggregate amount to be
allocated to each counsel representing one or more Purchasers in proportion to
the amount invested by such Purchasers) , and in connection with the enforcement
of rights and remedies of the Purchasers hereunder and under the Transaction
Documents and all other documents evidencing the transactions contemplated
herein; provided, however, that the Company shall not be responsible for any
such fees or expenses if the transactions contemplated by this Agreement are not
consummated. In addition, the Company shall reimburse each Purchaser for the
actual cost of any filings required under the HSR Act.
17
7. Miscellaneous
7.1 Definitions. For purposes of this Agreement, the following terms have the
meanings set forth below:
"Person" means an individual, a partnership, a corporation, an association,
a joint stock company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political subdivision
thereof.
"Proprietary Rights" means all (i) patents, patent applications, patent
disclosures and inventions, (ii) trademarks, service marks, trade dress, trade
names and corporate names and registrations and applications for registration
thereof, (iii) copyrights and registrations and applications for registration
thereof, (iv) mask works and registrations and applications for registration
thereof, (v) computer software, data and documentation, (vi) trade secrets and
other confidential information (including, without limitation, ideas, formulas,
compositions, inventions (whether patentable or unpatentable and whether or not
reduced to practice), know-how, manufacturing and information, drawings,
specifications, designs, plans, proposals, and customer and supplier lists and
information), (vii) other intellectual property rights, and (viii) copies and
tangible embodiments thereof (in whatever form or medium).
7.2 Governing Law. This Agreement shall be governed in all respects by the
laws of the State of Colorado as such laws are applied to agreements between
Colorado residents entered into and performed entirely in Colorado, except that
the General Corporation Law of the State of Delaware shall govern as to matters
of corporate law. The parties hereto waive all right to trial by jury in any
action or proceeding to enforce or defend any rights under this Agreement.
7.3 Survival. The representations, warranties, covenants and agreements made
herein shall survive any investigation made by any Purchaser and the closing of
the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company hereunder in connection with the transactions contemplated hereby
shall be deemed to be representations and warranties by the Company hereunder
solely as of the date of such certificate or instrument.
7.4 Successors and Assigns. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto
and shall inure to the benefit of and be enforceable by each person who shall be
a holder of the Shares from time to time.
7.5 Entire Agreement. This Agreement, the Exhibits and the other documents
expressly delivered hereunder, including the Transaction Documents, supersede
any
18
other agreement, whether written or oral, that may have been made or entered
into by the parties hereto relating to the matters contemplated hereby and
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof, and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
7.6 Specific Enforcement. Any Purchaser shall be entitled to specific
enforcement of its rights under this Agreement. The Company acknowledges that
money damages would be an inadequate remedy for its breach of this Agreement and
consents to an action for specific performance or other injunctive relief in the
event of any such breach.
7.7 Separability. In case any provision of the Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby and
such provision shall be enforced to the greatest extent permitted by law.
7.8 Amendment and Waiver. This Agreement may be amended or modified only
upon the mutual written consent of the Company and the holders of at least 66
2/3% of the Shares (voting on an as-converted basis).
7.9 Notices. All notices required or permitted hereunder shall be in writing
and shall be deemed effectively given: (i) upon personal delivery to the party
to be notified; (ii) when sent by confirmed telex or facsimile if sent during
normal business hours of the recipient, if not, then on the next business day;
(iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, special next day delivery, with
verification of receipt. All communications shall be sent to the Company at
0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000 and to a Purchaser at
the address set forth on Exhibit B attached hereto or at such other address as
the Company or Purchaser may designate by ten (10) days advance written notice
to the other parties hereto.
7.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
7.11 Broker's Fees. Each party hereto represents and warrants that no agent,
broker, investment banker, person or firm acting on behalf of or under the
authority of such party hereto is or will be entitled to any broker's or
finder's fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 7.11 being untrue.
19
7.12 Future Financings. Nothing contained in this Agreement or any Purchaser'
s prior dealings with the Company shall be deemed to constitute a commitment on
the part of any Purchaser to participate in any future financings by the
Company.
7.13 Confidentiality and Non-Disclosure. The parties hereto agree to be bound
by the confidentiality and non-disclosure provisions of Section 7.11 of the
Stockholders' Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
20
In Witness Whereof, the parties hereto have executed the Agreement as of
the date set forth in the first paragraph hereof.
COMPANY:
VStream Incorporated
By: /s/
-------------------------------
Title: ____________________________
PURCHASERS
Centennial Fund V, L.P.
By: Centennial Holdings V, L.P.,
Its General Partner
By: /s/
-------------------------------
a General Partner
Centennial Fund VI, L.P.
By: Centennial Holdings VI, LLC
Its General Partner
By: /s/
-------------------------------
Managing Principal
[Signature Page to Purchase Agreement]
21
Centennial Entrepreneurs Fund VI, L.P.
By: Centennial Holdings VI, LLC.
Its General Partner
By: /s/
---------------------------------
Managing Principal
Centennial Holdings I, LLC
By: /s/
---------------------------------
Its _________________________________
By: /s/
---------------------------------
Title: ______________________________
Softbank Technology Ventures IV, L.P.
By: STV IV LLC
By: /s/
---------------------------------
Managing Director
Softbank Technology Advisors Fund, L.P.
By: STV IV LLC
By: /s/
---------------------------------
Managing Director
Matsushita Electric Industrial Co., LTD
By: /s/
---------------------------------
Title: ______________________________
[Signature Page to Purchase Agreement]
22
Highland Capital Partners III Limited
Partnership
By: Highland Management Partners III Limited
Partnership
Its General Partner
By: /s/
------------------------------------
Title: _________________________________
Highland Entrepreneurs' Fund III Limited
Partnership
By: HEF III, LLC
Its General Partner
By: /s/
------------------------------------
Title: _________________________________
Intel Corporation
By: /s/
------------------------------------
Title: _________________________________
Excite, Inc.
By: /s/
------------------------------------
Title: _________________________________
Nexus Capital Partners, II, L.P.
By: /s/
------------------------------------
Title: _________________________________
[Signature Page to Purchase Agreement]
23
Porcelain Partners, L.P.
By: /s/
--------------------------------
Its General Partner
By: /s/
--------------------------------
Title: _____________________________
GE Capital Equity Investments, Inc.
By: /s/
--------------------------------
Title: _____________________________
Nettlestone Enterprises Limited
By: /s/
--------------------------------
Title: _____________________________
Millennial Holdings, LLC
By: /s/
--------------------------------
Title: _____________________________
Whitko & Company
By: /s/
--------------------------------
Title: _____________________________
Pequot Private Equity Fund II, L.P.
By: Pequot Capital Management, Inc.
Its Investment Manager
By: /s/
--------------------------------
Xxxxx Xxxxx, Chief Financial Officer
[Signature Page to Purchase Agreement]
24
Vivendi
By: __________________________________
Title: _______________________________
XXX Xxxxxxxxxxx
By: __________________________________
Title: _______________________________
[Signature Page to Purchase Agreement]
25
EXHIBIT A
FORM OF CERTIFICATE OF AMENDMENT TO
CERTIFICATE OF INCORPORATION
26
EXHIBIT B
SCHEDULE OF PURCHASERS
Initial Closing Second Closing
Number of Shares Aggregate Number of Aggregate
Purchase Price Shares Purchase Price
Name and Address
Centennial Fund V, L.P. 1,333,333 $ 3,999,999 N/A $ 0.00
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Centennial Fund VI, L.P. 2,333,333 $ 6,999,999 2,666,667 $ 8,000,001
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Centennial Entrepreneurs Fund VI, L.P. 58,333 $ 174,999 66,667 $ 200,001
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Centennial Holdings I, LLC. 46,667 $ 140,001 53,333 $ 159,999
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
SOFTBANK Technology Ventures IV, L.P. 2,943,600 $ 8,830,800 N/A N/A
000 X. Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
SOFTBANK Technology Advisors Fund, L.P. $ 56,400 $ 169,200 N/A N/A
000 X. Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
Other SOFTBANK Entities N/A N/A 1,666,667 $ 5,000,001
Highland Capital Partners III Limited $ 800,000 $ 2,400,000 N/A N/A
Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
27
Highland Entrepreneurs' Fund III Limited 33,333 $ 99,999 N/A N/A
Partners
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx Nova
Fax: (000) 000-0000
Millennial Holdings, LLC 33,333 $ 99,999 N/A N/A
0000 00xx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Nexus Capital Partners II, L.P. 2,500,000 $ 7,500,000 N/A N/A
C/O Nexus Group LLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
Porcelain Partners, L.P. 166,666 $ 499,998 N/A N/A
C/O Nexus Group LLC
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
GE Capital Equity Investments, Inc. 2,500,000 $ 7,500,000 N/A N/A
000 Xxxx Xxxxx Xxxx
Xxxxxxxx, XX 000000
Fax: (000) 000-0000
Asdale, Ltd. 1,666,667 $ 5,000,001 N/A N/A
c/o Aspen Advisory Services
00 Xxxxxxx Xxxxxx
Xxxxxx, XX0X0XX, XXXXXXX
Fax: (000) 00-000-000-0000
Matsushita Electric Industrial Co., Ltd. 1,333,333 $ 3,999,999 N/A N/A
0-0-0 Xxxxxx-Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxxxx 000-0000 Xxxxx
Fax: (000) 000-0000
28
Intel Corporation 3,666,667 $11,000,001 N/A N/A
0000 Xxxxxxx Xxxxxxx Xxxx.
Xxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Excite, Inc. 1,666,667 $ 5,000,001 N/A N/A
000 Xxxxxxxx
Xxxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
Whitko & Company 17,000 $ 51,000 N/A N/A
0000 X. Xxxxxxx Xxxx.
Xxxxxxxxx, XX 00000
Attention: Xxxxx xxX. Xxxxxxxx, President
Fax: (000) 000-0000
Pequot Private Equity Fund II, L.P. 4,666,667 $14,000,001 N/A N/A
000 Xxxxx Xxxx Xxxx
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
Vivendi 1,666,667 $ 5,000,001 N/A N/A
00 xxxxxx xx Xxxxxxxxx
00000 XXXXX, XXXXXX
XXX Xxxxxxxxxxx 1,083,333 $3,249, 000 X/X X/X
00 Xxxxxxxx
Xxxxxxxxx, XX 00000
Friends and Family N/A N/A 308,000 $ 924,000
TOTAL 28,571,999 $85,715,997 4,761,334 $14,284,002
29
30
EXHIBIT C
FORM OF AMENDED AND RESTATED STOCKHOLDERS' AGREEMENT
31
EXHIBIT D
FORM OF AMENDED AND RESTATED INVESTORS' AGREEMENT
32
EXHIBIT E
FORM OF LEGAL OPINION
33
EXHIBIT F
FORM OF SERVICES AGREEMENT
34
EXHIBIT G
FORM OF LICENSE AGREEMENT
35
EXHIBIT H
FORM OF PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
36
EXHIBIT I
SUPPLY AGREEMENT
37
Table of Contents
Page
1. Agreement To Sell And Purchase...........................................1
1.1 Authorization of Shares.............................................1
1.2 Sale and Purchase...................................................1
2. Closing, Delivery And Payment............................................1
2.1 Initial Closing.....................................................1
2.2 Second Closing......................................................1
3. Representations And Warranties Of The Company............................2
3.1 Organization, Good Standing and Qualification.......................3
3.2 Capitalization......................................................3
3.3 Subsidiaries........................................................3
3.4 Authorization; Binding Obligations..................................4
3.5 Consents and Approvals..............................................4
3.6 No Violations.......................................................4
3.7 Financial Statements; Interim Changes...............................4
3.8 Compliance with Laws................................................5
3.9 Proprietary Rights..................................................5
3.10 Actions Pending.....................................................6
3.11 Material Contracts..................................................6
3.12 Investments in United States Real Property Interests................6
3.13 Unrelated Business Taxable Income...................................6
3.14 Year 2000 Compliance................................................6
3.15 Taxes...............................................................7
3.16 Real Property.......................................................7
3.17 Labor Agreements and Actions........................................8
3.18 No Brokers or Finders...............................................8
3.19 Other...............................................................8
3.21 ERISA...............................................................8
3.22 Full Disclosure....................................................11
3.23 Securities Laws....................................................11
4. Representations And Warranties Of The Purchasers........................12
4.1 Requisite Power and Authority......................................12
4.2 Investment Representations.........................................12
5. Conditions Precedent To Purchasers' Obligations.........................14
5.1 Conditions Precedent to Initial Closing............................14
6. Expense Reimbursement...................................................17
i
7. Miscellaneous...........................................................18
7.1 Definitions........................................................18
7.2 Governing Law......................................................18
7.3 Survival...........................................................18
7.4 Successors and Assigns.............................................18
7.5 Entire Agreement...................................................18
7.6 Specific Enforcement...............................................19
7.7 Separability.......................................................19
7.8 Entire Agreement; Amendment and Waiver.............................19
7.9 Notices............................................................19
7.10 Counterparts.......................................................20
7.11 Broker's Fees......................................................20
7.12 Publicity..........................................................
7.13 Future Financings..................................................20
7.14 Confidentiality and Non-Disclosure.................................20
ii
